Skip navigation

Tag Archives: leftist dictator Hugo Chavez

Nationalization Is Theft
Venezuela, Russia, and other countries that nationalize natural resources are violating private property rights.

By Thomas A. Bowden

For years, the Canadian operator of a huge Venezuelan gold project known as Las Cristinas has been seeking an environmental permit to start digging. Well, Crystallex International Corporation can stop waiting–the mine is being nationalized as part of dictator Hugo Chavez’s long-running program of socialist takeovers. “This mine will be seized and managed by a state administration” with help from the Russians, said Mining Minister Rodolfo Sanz

 

It’s not surprising that a brute like Chavez would want to grab the 16.9 million ounces of gold estimated to lie buried in the Las Cristinas reserve. But what’s more puzzling is why–when gold mines, oil rigs and refineries worth billions of dollars are nationalized by regimes such as Venezuela and Russia–the ousted companies can muster no moral indignation, only tight-lipped damage appraisal.

The reason, in a nutshell, is that resources like gold and petroleum in their natural state are universally regarded as public property that cannot be extracted by private companies except with government permission, revocable at will. “Venezuela will not accept that foreign organizations tell them what to do with their own resources,” said a local journalist recently.

But unexploited natural resources are unowned, not publicly owned. Ownership–the legal right to use and dispose of material resources–cannot exist until someone actually brings those resources under human control. A dictator cannot, by decree, bring hidden gold or oil deposits to the surface. Only the knowledge and effort of entrepreneurs, engineers and drillers can transform that hidden potential into actual wealth. Ownership is the law’s recognition that those particular producers deserve the legal right–as against every person on earth who didn’t tap that potential–to control the wealth they created.

Consider that Arabs wandered for centuries across desert sands that concealed vast petroleum deposits, but it was Western investors who actually made Middle Eastern petroleum valuable. These companies searched for many years in a vast wilderness, moving in frustration from one dry hole to another, risking utter failure and financial ruin. Eventually, by virtue of their ingenuity, courage and perseverance, world markets were flooded with oil that Middle Eastern governments should have deemed private property–100% private

 

Instead, those governments muscled in, claiming public ownership based on nothing but their sovereignty over the geographical areas where oil deposits happened to reside. First through royalties, then by extorted royalty increases, and finally by outright nationalization, the descendants of nomads whose meager possessions fit on a camel’s back could now build palaces, buy airplanes and fund terrorism from the seemingly endless profits generated by Western technology and ingenuity.

But all this was a perversion of sovereignty. After all, why are states entrusted with exclusive power to use force within their borders? There’s only one legitimate reason: to protect individual rights, including property rights. Just as a bodyguard’s task is protecting clients from physical attacks, a government’s function is safeguarding people and property against criminals and foreign invaders.

Sovereignty exists to protect private property, not to destroy it. A bodyguard who claimed to own his client’s house, cars and jewelry would be immediately fired. Yet governments that claim to own all natural resources within their borders get a free pass, as if ownership could be conjured from the barrel of a gun.

Today, nationalization is endorsed not only by third world thugs but by the United Nations, which–with America’s full agreement–declared in 1962 that the “sovereign right of every State to dispose of its wealth and natural resources” is “recognized as overriding purely individual or private interests.” Even the victims agree. Said one CEO: “We do not see the issue of nationalization as a violation of the law but as a right of a government.”

This is why power-grasping dictators like Venezuela’s Hugo Chavez and Russia’s Vladimir Putin can claim moral authority to treat foreign investors the way they treat their own citizens–as cattle to be herded, milked or slaughtered for society’s sake. Thus when ExxonMobil recently dared to dispute the pittance Venezuela offered in payment for seized assets, Chavez denounced “those bandits of ExxonMobil,” absurdly declaring they “will never rob us again.”

Nationalization, stripped of all rationalization, is naked theft. A blow for justice will be struck by the first public figure to denounce it as such. In the meantime, companies like Crystallex will continue to be bullied by dictators who know exactly how much they can get away with.
     
Thomas A. Bowden is an analyst at the Ayn Rand Center for Individual Rights. Mr. Bowden is a former lawyer and law school instructor who practiced for twenty years in Baltimore, Maryland. The Ayn Rand Center is a division of the Ayn Rand Institute and promotes the philosophy of Ayn Rand, author of “Atlas Shrugged” and “The Fountainhead.”

Copyright © 2008 Ayn Rand® Center for Individual Rights. All rights reserved.

Op-eds, press releases and letters to the editor produced by the Ayn Rand Center for Individual Rights are submitted to hundreds of newspapers, radio stations and Web sites across the United States and abroad, and are made possible thanks to voluntary contributions.

If you would like to help support ARC’s efforts, please make an online contribution at http://www.aynrandcenter.org/support.

This release is copyrighted by the Ayn Rand Center, and cannot be reprinted without permission except for noncommercial, self-study or educational purposes. We encourage you to forward this release to friends, family, associates or interested parties who would want to receive it for these purposes only. Any reproduction of this release must contain the above copyright notice. Those interested in reprinting or redistributing this release for any other purposes should contact media@aynrandcenter.org. This release may not be forwarded to media for publication.

ARC’s media releases are solicitations sent to addresses obtained

http://blog.heritage.org

Morning Bell: Toward a More Resilient Nation

Posted By Conn Carroll On September 11, 2008 @ 9:11 am In Protect America | 1 Comment

This evening John McCain and Barack Obama will appear together (but speak separately) as part of a [1] nationally televised forum at Columbia University in Manhattan. The two presidential candidates have promised to set aside politics to commemorate the seventh anniversary of the 9/11 attacks and will instead lay out their personal visions on civic engagement and service. The candidates’ call for unity on this day is admirable, but the chosen topic of the event is also yet another missed opportunity for the American people to hear about how each candidate plans to protect our country from future attacks and disasters.

Energy, taxes and federal spending are all important issues that deserve the candidates time, but [2] the candidates have devoted almost no time to discussing their vision for improving homeland security. Despite this lack of attention, Americans still face threats from abroad (where al Qaeda has reconstituted itself in the border regions of Pakistan and Afghanistan) and at home (another hurricane is bearing down on Texas and California).

Seven years after 9/11 and more than five years after its creation, [3] the Department of Homeland Security is afflicted with high turnover and low morale. It has turned into a political football that [4] answers to 86 different congressional committees and subcommittees (by contrast, the Department of Defense answers to only 36 committees, and six of those handle 80% of the oversight). Too much attention is focused on DHS, which ought to be only one part of a much larger homeland security system that includes not just federal agencies like the the Departments of Defense, Health and Human Services, Justice, Energy and State, but also state and local governments.

Due to its sheer size and growing population, the United States has many vulnerabilities. Spending billions to protect infrastructure does not make the nation invulnerable. It is impossible to protect every target, and a strategy predicated on protection is bound to fall short. For too long the federal government has been designating more and more items as “critical” infrastructure. If everything is critical, nothing is critical. Instead, the next administration should pursue [5] a strategy of resiliency. Heritage senior research fellow James Carafano explains: “[R]esiliency promises something much more achievable and important: sustaining society amid known threats and unexpected disasters. Indeed, the more complex the society and the more robust the nature of its civil society, the more it should adopt a strategy of resilience.”

Toward this end, Carafano [6] recommends:

  • Establishing improved public-private models for risk management that define reasonable roles for government and industry.
  • Encouraging bilateral cooperation to address liability issues.
  • Developing national and international forums for increasing collaboration.
  • Innovating to pave the way for resilient public infrastructure in the 21st century.

As we remember those we lost seven years ago, it is also a good time to reflect on what we can do better to protect all Americans from tomorrow’s threats, both natural and man-made. Hopefully, we’ll hear both candidates address these issues soon.

Quick Hits: