The Plundered Planet: Why We Must--and How We Can--Manage Nature for Global Prosperity 1st Edition
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From Publishers Weekly
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"Paul Collier is a brilliant mind with a keen understanding of the modern world's obstacles to progress. In The Plundered Planet, Collier tackles some of the most difficult questions of our time, and offers an insightful framework for effectively managing our world's natural resources. Collier's
book is an important meditation on how we can build a world that is more equal, more sustainable, and more prosperous for all humankind." --President Clinton
"Paul Collier has written with great insight about the prospects of the bottom billion. In The Plundered Planet, he addresses himself to the complex opportunities, challenges and risks in managing the planet's natural resources. The bottom billion have a huge stake and an important role in the
outcomes. Collier helps us see these issues through their eyes." --Michael Spence, winner of the Nobel Prize in Economics
"In this path-breaking book, Paul Collier develops one of the most fascinating subjects he touched on in The Bottom Billion -- the resource curse. It will be of great interest to all those who are concerned about the future of our civilization." --George Soros
"Paul Collier's 'The Plundered Planet' should not only be read by every one of us but also force-fed to every politician." -- Buffalo News
"Read this book."--Sir Nicholas Stern, author of The Stern Review on the Economics of Climate Change
"Collier has made an important contribution in bringing together usually separate fields. His efforts may spark scholars in disparate disciplines to cooperate on these important problems--especially scholars who work at different scales." -Science
"A practical handbook for ending world poverty - a must read." -- The Sunday Times
"The Plundered Planet is right to highlight the importance of government accountability in addressing poverty and climate change. But it will be the dispersion of power, fuelled by entrepreneurship and innovation, that will ultimately empower individuals to create accountability and solve global
- Publisher : Oxford University Press; 1st edition (May 11, 2010)
- Language : English
- Hardcover : 288 pages
- ISBN-10 : 0195395255
- ISBN-13 : 978-0195395259
- Item Weight : 1 pounds
- Dimensions : 8.3 x 1.1 x 5.8 inches
- Best Sellers Rank: #1,777,717 in Books (See Top 100 in Books)
- Customer Reviews:
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Who is responsible for plundering our planet? What explains this lack of consideration for the well-being of entire populations and of future generations? The real culprit is not greed and avidity, which Collier sees as part of human nature—as is compassion and generosity, although economists often tend to forget the better angels of our nature. The reason we are plundering our planet is because incentives are not properly aligned, and because checks and balances are not always in place to rein in the avidity of economic and political actors. Plunder is usually tempered by regulations. These regulations are severely lacking in countries that Collier describes as host to the “bottom billion”, the part of humanity that still lives in abject poverty. In these impoverished countries at the bottom of the world economy, rules are often manipulated by political leaders for their persona advantage. Private companies take advantage of this corrupt environment to negotiate deals and seize resources, depriving populations of their rightful share. At the global level, where no government exists to enforce global rules, regulation is almost nonexistent. The consequence is that “for those natural assets and liabilities that are global, such as the fish of the ocean and the carbon of the skies, plunder is currently the standard.” If the diagnosis is correct, the remedy is straightforward: set incentives right, especially through the price mechanism, and plunder will disappear, to give way to efficient management of natural resources.
On this point at least, Collier doesn’t depart from standard economics. But he has some qualms with his colleagues’ approach to ethics. On the one hand, economics assumes that people are interested only in their own consumption, and that they will do everything in their power to maximize their own private utility. On the other hand, economists make prescriptions according to an ethical framework that is selfless in the extreme: society as a whole should maximize the utility of all its members, including future generations that are not yet born. Since poor people take more utility from an extra unit of revenue and consumption than richer people, resources should be distributed equally, or saved in their entirety for future consumption. The result is moral confusion: “Polarized between an ethical framework in which people ought to behave like saints, and a view of human nature in which they actually behave more like psychopaths, economists are often unenthusiastic about democracy. They prefer an authoritarian government that tells people what to do, and takes its advice from economists.” Economists are also uncomfortable with nations and borders: these artificial divisions hamper the efficient allocation of resources, and should, in their opinion, be replaced by a world government.
Paul Collier shows that this theoretical framework can easily be amended to allow for a richer and more realistic ethics. First, he acknowledges that the nation-state is a legitimate institution, one in which democratic choice and accountability of public action can be fully exerted. The natural assets that lie within a nation’s historic borders are a legitimate property of its people, and the revenues from their exploitation should accrue to the whole population. Second, the rights of future generations should be taken into account in present decisions over production and consumption: “we have an ethical responsibility to bequeath to unborn generations either the natural assets bequeathed to us, or other assets of equivalent value.” Third, nations have no right to harm the citizens of other nations, either directly or indirectly, to benefit their own nationals. In particular, resources held in common, or liabilities that accumulate across and beyond borders, should be managed collectively. He calls this simple framework an ethics of custody, and shows that it is consistent with values held by most people regardless of their cultural or religious proclivities. Interestingly, he notes that custody over nature resonates with the Christian concept of stewardship, by which God entrusts on mankind the management of his dominion. Indeed, the word “plunder” has many occurrences in the Bible, where it describes the many acts of war and conquest by the ancient tribes of the Old Testament.
Another concept that has strong religious undertones is the notion of curse, as in the “resource curse.” For Paul Collier, who doesn’t use these words in their Christian acceptation, the riches provided by nature should be a blessing. Instead, they are a double curse: first, people in their vast majority are deprived of their rightful possession by corrupt elites and exploitative international firms; second, the countries that harbor these resources fall into a cycle of bad governance, internal warfare, and economic shrinking. For Collier, the resource curse is “the most crucial issue in the struggle to transform the poorest societies.” In order to analyze the problem, he decomposes the exploitation of natural resources into a chain of decisions: discovering natural assets with the help of specialized expertise while avoiding a gold rush; negotiating with international companies for their exploitation while countering corruption; setting the tax system right to capture rents without frightening investors; determining the right level of resource extraction to balance the interests of present and future generations; managing the economy through periods of booms and decline; investing in the economy to absorb the resource windfall and redistribute it to the population. Each part of this decision chain is subject to the weakest link phenomenon: miss one important step, and the whole chain will unravel.
Like all scientists, Paul Collier stands on the shoulders of giants. As he acknowledges in an appendix, “there is an enormous academic literature on the themes covered in this book.” But he chooses to list as sources only the papers that he coauthored, and he also pays tribute to his junior coauthors by underscoring their contribution in the text. Many paragraphs read like the translation of academic papers into everyday language. Paul Collier is better at doing so than, say, a journalist or another academic colleague, because he lets us enter into the kitchen of his research, explaining how he developed his ideas and went about to confront them to empirical data. This way he is best placed to interpret his own work, whereas referring to others’ lines of research would have him venture ideas on which he can claim no ownership. To be true, he acknowledges the role of prominent economists, who happen to be his close friends, such as Nicholas Stern, Anthony Venables, and Michael Spence, who contributed a lot to shaping his views on the economics of nature. It would have been interesting, however, to underscore the points on which his research results differ from those of other authors, or the debates and controversies that they may have fueled (his thesis that greed trumps grievance in civil war is highly controversial among political scientists). Likewise, his emphasis on a limited number of research results makes the book’s shelf life rather short, as the research field evolves quickly: we don’t know which results will stand the test of time and will lead to new investigations, or which ones will ultimately prove to be dead ends.
Much as an economist builds on accumulated results, he also relies on datasets. Here the role of shouldering giants are played by international institutions such as the World Bank, or research consortiums such as the one who produced the Polity IV database that measures a country’s degree of democracy or autocracy along time. Having worked as director of research at the World Bank, Paul Collier was in a key position to promote the elaboration and dissemination of these datasets, which are international public goods on which social scientists depend a lot. In his book, he use indicators drawn from the Doing Business database or the CPIA measure of governance as well as a commercial rating called the ICRG that also evaluates the quality of governance. He also refers to the global inventory of subsoil assets that was pieced together by the World Bank in 2000 and that forms the basis of green accounting. These data series form the bread and butter of economists; without them, it would not be possible to ground ideas and proposals on concrete evidence. One should note, however, that economists increasingly question the way these indicators are used in cross-country regressions, which is the favorite methodology used by Paul Collier for his empirical testings.
But Paul Collier’s research is not only based on complex economic reasoning and statistical testing; his policy proposals are also grounded on plain common sense and an acute sense of observation. Sometimes, talking to people yields the best ideas. Paul Collier refuses to be confined to the role of the ivory-tower economist. He records the conversations he had with the rich and the powerful: he was invited to present his ideas to a meeting of G20 finance ministers, advised the President of Sierra Leone on how to run auctions for allocating extraction rights, and addressed a gathering of African officials chaired by the President of Cameroon. The reason economists like Paul Collier are called by leaders and invited to international forums is because they tend to think outside the box. Especially in environmental matters, where debates are often obfuscated by ideological arguments, economists are natural contrarians. They do not shy away from picking up a good fight, too. Like many World Bank economists, Paul Collier likes to chide his colleagues from the IMF: he shows that their policy recommendations are often impractical and based on false assumptions. Contrary to many pundits, he has a nuanced view of China’s economic role in Africa. While he is the first to acknowledge the plunder that is taking place in the race to secure resource extraction deals, he also points that Chinese-style deals might also be attractive to reformers, locking in decisions to invest in infrastructures. China is also the only donor offering to finance geological surveys for free.
Like in The Bottom Billion, there is a moral dimension to Paul Collier’s books. Here the author’s moral impulse collides with his professional identity as an economist. The ethics of nature that he outlines is inconsistent with the values and beliefs that economists tend to nurture. Saving the planet, and managing natural resources for global prosperity, requires much more than setting price incentives right: it is a moral calling that has strong religious undertones. Recall that Collier’s concept of custody is close to the Christian’s notion of stewardship. In another book on democratic governance in Africa, he notes that Christian individuals (especially women) in high office are more committed to the public good. Of course, Paul Collier doesn’t preach or proselytize for his parish: he has too much humor and intellectual modesty to be cast in the role that Jeffrey Sachs now occupies in intellectual debates about global poverty. But the force of his arguments come from the fact that they are inspiring as well as intellectually compelling. Like after a good homily, the listeners feel uplifted and come out of the assembly with renewed resolution to do good. This is not an attitude that economics usually encourages. I would submit The Plundered Planet to the church pulpit test: if I were a pastor (or a rabbi, or an imam), would I recommend this reading to my parish? The answer is a resounding yes, but I would make sure it is accompanied by an uplifting sermon. Among the many Bible quotes that mention plunder, I would choose Isaiah 3:14: “The LORD will enter into judgment with the elders of his people, and its princes: For you have eaten up the vineyard; the plunder of the poor is in your houses.”
He is especially good on macroeconomics and national policy, and on the problems of corruption--the "plunder" side of the equation. The middle part of the book, where he dissects this in detail, is by far the best.
He has many good things to say about one of my research areas, fisheries, where we are depleting a resource that should be sustainable, and therefore depriving future generations through sheer irresponsibility. Unfortunately, his cure is to leave fishery regulation to the United Nations and the individual nations that hold territorial waters. The United Nations does not even stop genocide; they saw fit to elect China and Sudan to the Human Rights Commission and then re-elect them. The chances that fish will get better care are somewhat remote.
Collier defends GM crops, nuclear energy generation, and some other things that will raise hackles; I agree with him and the facts are pretty much there, but one must worry about the future with the GM crops, since they are poorly regulated so far.
Collier leaves out two key points that he absolutely needs, to make his case. One is population growth. The delusion that population will naturally stop growing around 2050--a false claim--may have deluded him. In fact, world population is growing far too fast. This could be stopped without any draconian measures, simply by giving girls some education--every year in primary school reduces ultimate birth numbers--and by providing comprehensive health care including family planning options. That done, people are sensible enough to make the right decisions.
Next comes the worldwide decline in good farmland. Urbanization, including building of roads and airports, is a lot of the problem. Erosion and desertification is the rest of it. At current rates of urbanization, my home state of California will lose its last farm around 2050, and China will lose its last one within a century or so. China is moving its agriculture to Brazil, Sudan, and so on--what will the Brazilians and Sudanese eat in the end?
In one place, Collier is wrong, and is so wrong that I find it mystifying: he argues for large-scale agribusiness as opposed to small farms. He holds up the model of the impoverished, capital-less African smallholding or the "romantic" organic hobby farm as the only alternatives! What happened to normal small-to-medium-sized commercial agriculture? There are thousands of studies, over 300 years, using literally tens of millions of data points, that show these are better than large-scale absentee-landlord agribusiness of the Brazil/California style. One can go all the way back to Arthur Young in the 1770s, already proving it. Collier even talked to Hans Binswanger, whom he admits is "the leading international expert on African agriculture" (and, one may add, on some other ag issues), and Binswanger tried to set him straight; but Collier disagrees. One need only read Binswanger's work--or Robert Netting's, or any of a thousand other authors--to see that reasonably-capitalized, intensive, family farming or comparable middle-scale intensive farming is what works. Agribusiness ruins the land and has appalling social consequences; we see a lot of this in California, where, most recently, agribusiness ruined the vast and fertile Tulare Basin by allowing salinization, and now a family farmer is reclaiming a chunk of it through sheer hard work.
Or take my own Mexican research: Maya Indian farmers on tiny plots succeed where every agribusiness effort has failed, in the harsh habitat of the Yucatan peninsula. Hard work and skill will generally beat absentee landlordship and careless use of heavy-duty capital, especially in an environment really needed that skill.
Top reviews from other countries
Putting to use his razor-sharp economics brain, Professor Collier cuts through the sea of romanticized preconceptions and prejudices surrounding development economics. He has no time for self-interested lobbies or the fluffy middle-class love affair with peasant agriculture. The book is written with two basic ethical principles in mind:
1) the world's poorest must be lifted up; and
2) civilisation must be made sustainable.
Almost everyone will find some of their positions exploded (I certainly did).
The first section lays out his ethical principles. The second (long, technical) section deals with the chain of decision-making required for African countries to orchestrate an economic transformation through resource exploitation. The final sections deal with the big-picture environmental issues of the day.
Some key points
- International fishing rights need to be owned, otherwise international fisheries will be destroyed
- All subsidies to the fishing industry should be ended as soon as possible.
- A carbon tax is by far the most economically rational solution to climate change
- The key players who might block such a deal are Russia and the Middle East (i.e. the carbon exporters), not China and the USA
- The world needs more commercial agriculture on the Brazilian model, not less
- America should drop its fantasy of achieving energy independence through home-gown biofuels
- Europe should lift its damaging and anti-progressive ban on GM
- Organic food is a rich-world luxury, not a tool for feeding the poor
Telling statistic: until the GM ban in 1996, European grain yields tracked those of the US. Since 1996 they've fallen behind by 1-2% per year. As Europe is a big grain producer this is a major contributing factor to higher food commodity prices.
Quote: "The idea that fishermen should get the rights to scarce fish for free is analogous to oil companies getting the rights to oil for free."
Professor Collier points out that in this networked age, people power will prove decisive to more enlightened public policy. Have a look at NaturalResourceCharter[DOT]org. A brilliant book - anyone interested in a better, more sustainable, world would do well to absorb its lessons.
First and foremost Collier is an economist through to his core, and quite a free market one at that. The strength of the best parts of this book derives from this fact, as also do the parts which other strongly environmentalist readers may baulk at.
He gives an excellent accessible account of the basic economic incentive and contractual problems at the heart of relations between many weak and often corrupt poor country governments and the private companies that extract their natural resources. There is no prevaricating on the evils of large corporations, just astute insights into the nature of the issues. Just like the poverty traps explained in his "Bottom Billion" book, these insights and explanations are pure gold. As in the bottom billion he explains how natural resource incomes can taint the incentives and processes of democracy.
A major theme which some environmentalists may struggle with is the concept that depleting nature is more acceptable for a country as long as the incomes from that depletion is invested to provide future generations with a higher standard of living. Many environmentalists would be unwilling to give nature or natural assets any such opportunity cost or value, but as an economist Collier is prepared to, and points a finger at the "romantics". He puts forward that we have "custody" responsibly over nature and should not plunder it, but we do not have the obligation to completely preserve it.
He discusses at length two tragedy of the commons type issues, being fishing and carbon emissions. Regarding fishing he suggests that the international seas should have ownership rights which revert to the United Nations, where profits can be used for food aid. The ownership would be the perquisite for a quota system to stop plunder.
Regarding carbon he favours a universal "shadow price" for carbon emissions rather than a cap and trade system. He argues that a cap and trade system encourages "gaming" by states to angle for advantage. Cap and trade approaches could see rich polluters willing to pay poorer countries to use up their pollution allocations, where as a shadow tax approach aspires to make polluting equally more expensive for everyone, which obviously is proportionally more hurtful to poorer people. His approach could therefore be argued to be more efficient but perhaps regressive. But of course an economist may conclude that efficiency should come first, and issues of distribution can be balanced after by other means.
Finally another point Collier brings up is that although China's habit of paying for extracted African resources by building infrastructure has been criticised by the West for being opaque, actually compared to the poor record of African governments effectively investing resource incomes, the Chinese approach could be viewed as a good deal.
That's enough summarising. Just buy it.
Importantly, also a simple and convincing description of economic theory dealing with socalled "global commons" such as international fisheries and carbon emissions. Yet also a problem in that category: Why not admit that the same theory applies equally well to child birth and population growth? Not even a passing mention. I suspect the author consider the subject too controversial and rather than writing some gobbledygook he knows is false, he choose to ignore it.