Maravi

(PROGRESS) Bolivia grabs control of a key gas pipeline firm

Bolivia grabs control of a key gas pipeline firm
Nationalizing a company is risky -- is it fair?
We comment upon and publish this 2008 appearing article in the BBC on June 2.

JJS: When most people are poor and a few are rich, it’s not hard to see the rationale for taking over the means of production. It’s even easier to understand the seizing of a valuable natural resource, something made by no one and needed by everyone. Mix in human nature which wants control and has utter faith in the power to determine the outcome. Compound that with the human inability to see “rent”, that flow of trillions of dollars, all our spending on all the nature we use, both sites and resources, not to mention EM spectrum. Yet for all its invisibility, this flow of rent is key; it makes some rich, it endows those few with inordinate political power.

To really bring about change, to let everybody prosper forever, to establish a just commerce for both business and consumer, forget power, owning, and control. Instead, institute the principle of compensation: those who exclude others from nature must compensate them.

Since we all must live somewhere, we all must exclude others. All of us would pay in land dues and get back the compensation, a rent dividend. Those who claim the most valuable sites – downtowns and oil fields – would pay the highest land dues; those humblest who claim the least favored sites would pay the least. As in Alaska which pays an oil share, all citizens would get back the same size dividend.

So, for the fairest outcome to all – and to avoid giving the US military/industrial establishment another reason to invade yet another country – forget seizures and public property. No government, including the US, can easily argue against taxes, since all of them live off taxes. Instead, implement “land dues”; raise the tax rate on the value of sites and resources, while lowering to zero taxes on the things that humanity does produce.

Finally, to avoid domestic government corruption -- a legitimate concern of everyone -- pay back the lion’s share of the recovered rent to all the citizenry as a periodic dividend. What arrangement could be fairer? More efficient? And politically more astute? It’d be hard to beat geonomics.

Now to the news.

BBC: President Evo Morales said Transredes had been seized after US company Ashmore Energy International failed to agree to a share buy-back.

Transredes transports Bolivia's natural gas to clients in Brazil and Argentina. It is the latest move in the Bolivian president's recent effort to nationalise key industries. Ashmore has yet to comment on the move.

President Morales said Ashmore had agreed to sell some of its 25% share in the firm but that these talks had not led to a deal. "We waited patiently all month, but the actions they took were totally different," the president said.

"They wanted to be bosses, and have us be the employees. We're a small country - sometimes they call us underdeveloped - but we have lots of dignity. Partners are welcome, but we will not accept bosses."

Officials said Royal Dutch Shell, cited as another foreign in investor in the pipeline, had wanted to work with them.

President Morales came to power two years ago promising his country's poor a greater share in revenues from the oil and gas industry.

The BBC's South America correspondent Daniel Schweimler says the president's radical plans have upset foreign companies and threaten to split the country.

Three regions in Bolivia's east, where most of the oil and gas is found, have recently voted for greater autonomy and oppose sending more revenues to the central government.

Parts of Bolivia's energy industry was privatised in the 1990s, with foreign companies taking 50% stakes.

Last month Bolivia's state energy company bought a majority stake in Spanish-owned Andina, one of the country's biggest energy companies which exploits oil and gas fields, and owns a 50% stake in two giant gas fields.

It has also taken over, by state decree, the control of Chaco from BP and Pan American Energy.

Morales is an ally of Venezuelan President Hugo Chavez, who has also taken back control of a number of industries from foreign control, including oil, electricity and cement.

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Jeffery J. Smith runs the Forum on Geonomics.

Labels: BOLIVIA, EVO MORALES, NATIONALISATION

posted by MrK @ 4:07 AM