Resource Rights and Human Rights
Subsidies skew our reality and impoverish others
Much of the world lives in poverty, under subsidies, without rights, and with corruption. Yet there is an antidote that everyone could promote -- the land ethic. We trim, blend, and append three 2010 articles from: (1) MarketWatch, Apr 9, on subsidies by Thomas Kostigen, author of The Green Blue Book: The Simple Water-Savings Guide to Everything in Your Life; (2) Forbes Asia Magazine, Apr 12, on water by David Zetland at UC-Berkeley; and (3) New Zimbabwe, Apr 5, on minerals by Mutumwa D. Mawere.
by Thomas Kostigen, by David Zetland, and by Mutumwa Mawere
A fake America
Two hundred dollars for a hamburger. A gallon of gasoline, $15. The price of clothes: double. Milk, $6 a gallon.
These could be the real prices without subsidies. Americans may pay lower prices at the checkout counter but we compensate by paying higher taxes.
Farm subsidies in rich countries depress global prices so much that people in Africa and elsewhere import food. Farmers in poor countries are left without incomes or even without food; they can't afford to grow it.
It wasn't until 80 years ago when the Federal Farm Board was created that subsidies were introduced. Now, cotton, corn, cattle, soy, and pretty much the entire US agricultural sector are subsidized. Similarly, the price of water is underwritten.
The world's biggest oil companies during years of record profits still receive as much as $35 billion per year in subsidies from US taxpayers alone. (Europeans dole out another $10 billion a year in oil subsidies.) Nuclear energy wouldn't be feasible without subsidies; it is too costly to manufacture. Coal, natural gas, and alternative energy sources are also artificially priced.
Those who receive the subsidies, and who gain market advantages by being able to offer lower prices, win out -- big. These recipients are big businesses. Washington and Corporate America see double when subsidies are discussed: subsidies are sacred; subsidies are evil.
Globalization with subsidization is both wasteful and unfair. Eliminating farm subsidies in the US alone would immediately lift millions of people out of poverty around the world. Let’s put an end to fake markets and eliminate subsidies that tilt the playing field the world over.
Water Rights and Human Rights
Bad water and bad sanitation kill 2.8 million people a year. Three in four victims are children.
Fifteen countries have amended their constitutions to include a human right to potable water. "Access to an improved water supply" (a UN definition) went from 74% of the population before rights to 81% in 2006. In 12 comparable countries without water rights, access increased from 77% to 82%. No significant difference between the two groups.
These are developing countries with weak institutions, opaque politics, and deep corruption. Can a "right" lead to flowing taps in a place where free speech gets you killed, police solicit bribes from victims, and politicians give state assets to cronies?
It seems even less likely that we can give the poor money when we can't even give them water. But water in many nations is owned by the people. Individuals are entitled to shares.
We can divide this property right into inalienable "need" rights that cannot be traded and "want" rights that can be. Tradable rights could be rented but not sold -- protecting owners from sharp dealing and communities from drying out. Trade water numbers would be 130 gallons a day in water-scarce Israel and 1,100 in Haiti.
Don't give the poor some vague, unenforceable human right to water. Give them their water and let them prosper from it.
The political economy of mining
After 54 years of independence, many African countries remain among the least developed and yet paradoxically are richly endowed with valuable minerals. There is no consensus on how rents should be allocated and who should benefit from land, water, and minerals. Some post-colonial regimes have gotten rich from economic rents and rent-seeking activities.
The nationalization of minerals has opened a new window for rent collection. In South Africa, anyone who wishes to access such resources has to apply for a license. The license system has proved to be a convenient source of revenue for the new political class.
The most politically expedient route has been to institutionalize the link between political patronage and access to resources. Stories abound of well-connected individuals being allocated new order rights.
Julius Malema, president of South Africa’s ANC Youth League, is acutely aware that Zimbabwe has minerals that South African mining houses want. Malema, by associating himself with the party that holds the power in Zimbabwe to selectively apply the laws and to put into place the same kind of mechanism that has rewarded South Africa’s well-connected, he will no doubt be the bi-national bridge at a price for South African companies.
Malema said: “They have been exploiting our minerals for a long time. Now it’s our turn to also enjoy these minerals. They are so bright, we refer to them as white people; maybe their color came as a result of exploiting our minerals. Perhaps if some of us can get opportunities in these minerals we can develop some nice color like them.”
JJS: It bears repeating: the worth of Earth is for everyone to share, while the fruits of our labor are ours. Repeat it as often as you can. Pay taxes for what you take, not what you create. Plus, special interests should not get subsidies; everyone should get a fair share of recovered rents -- the geonomic prescription.
Jeffery J. Smith runs the Forum on Geonomics.
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