Who should own natural resources?

[gevorg]

So far we're still following the ancient tradition of whoever discovered first, keeps it monopolized for many decades to come (for example: Rockefeller's Standard Oil to Chevron/etc).

What are the pros and cons if the state and/or federal governments would own the companies that involve in natural resource extraction? Or just keep them private but non-profit (i.e. all profit is fully taxed unless its approved for R&D).

 

[spidey07]

Why do you guys hate profit so much? This is like the 4th post in a few hours that think profits are bad or somehow unjust. The government has no business owning any natural resource even though I know it happens today, it still doesn't make it right.

How about we keep it private and FOR PROFIT so companies continue to innovate on finding and using those natural resources?

The easy cons of government ownership would be price fixing, higher cost, inefficient, rationing and control. No pros that I can think of.

Profit drives efficiency and expansion.

 

[blackangst1]

Private and for profit.

 

[gevorg]

There is nothing wrong with profit of course, but the profit of natural resource companies comes from the land that everyone lives on and protects in case of war. Why shouldn't that profit be distributed for everyone's good and future generations? Unlike a typical company that needs competitive products and services to survive, a natural resource company just has to find a way to extract and transport it cheaply once in a while.

 

[OCGuy]

The natural resources are discovered due to the drive for profit. Why is it hard for people to understand that profit is the driving force?

You think this would have been discovered if BP were a charity?

http://www.rigzone.com/news/ar....asp?a_id=79959&hmpn=1

 

[spidey07]

Originally posted by: gevorg
There is nothing wrong with profit of course, but the profit of natural resource companies comes from the land that everyone lives on and protects in case of war. Why shouldn't that profit be distributed for everyone's good and future generations? Unlike a typical company that needs competitive products and services to survive, a natural resource company just has to find a way to extract and transport it cheaply once in a while.

Don't they also have to own or lease the property from where they take it? If some company said I had oil under my property they can't just come and get it.

Think about that scenario if the gubment claimed ownership of that resource on my property, do you think I would be compensated fairly, if at all?

 

[blackangst1]

Originally posted by: gevorg
There is nothing wrong with profit of course, but the profit of natural resource companies comes from the land that everyone lives on and protects in case of war. Why shouldn't that profit be distributed for everyone's good and future generations? Unlike a typical company that needs competitive products and services to survive, a natural resource company just has to find a way to extract and transport it cheaply once in a while.

Do natural resources get profited on without the land owners consent or participation? (In the USA of course)

 

[ElFenix]

alaska owns the oil under it. i haven't heard of the oil companies complaining. saudi arabia owns the oil under it and the generous deals it got from US oil companies helped fuel the first nationalization of irani oil fields (as the iranis were getting shafted by the brits)

 

[gevorg]

Originally posted by: OCguy
The natural resources are discovered due to the drive for profit. Why is it hard for people to understand that profit is the driving force?

You think this would have been discovered if BP were a charity?

http://www.rigzone.com/news/ar....asp?a_id=79959&hmpn=1

non-profit =! charity

A non-profit company can still have a R&D department with bonuses to people who make great contribution to new discoveries and methods. This will be the driving force, so yes a non-profit BP would be able to discover new oil fields.

 

[TheSkinsFan]

Originally posted by: blackangst1
Private and for profit.

this.

 

[spidey07]

Originally posted by: gevorg

Originally posted by: OCguy
The natural resources are discovered due to the drive for profit. Why is it hard for people to understand that profit is the driving force?

You think this would have been discovered if BP were a charity?

http://www.rigzone.com/news/ar....asp?a_id=79959&hmpn=1

non-profit =! charity

A non-profit company can still have a R&D department with bonuses to people who make great contribution to new discoveries and methods. This will be the driving force, so yes a non-profit BP would be able to discover new oil fields.

What motivation would they have? Remove profit and the motivation is gone. Think of it like work. Why do you go to work everyday? Would you still go if they gave you food and shelter instead of money?

 

[Craig234]

Situational. There are always going to be 'private interests' happy to grab 'ownership' of anything they can profit from, and that can be excessive and expooitave.

However, there are also times a for-profit service makes sense and some resources can well be 'privatized' in those cases.

The private-capital fad a bit ago to try to buy as much fresh water in the world as they could so they could then resell it to humanity who absolutely needs it, is a bad policy IMO.

It's a concidence you post this the same day I heard a news story about how China, who has 90% of the world's rare earth minerals, is tightening its access to them.

These are used in products from wind turbines (which China is the world's technology leader in) to Prius engines to Blackberries to missile guidance and other high tech devices.

This could create some shortage for Western nations and perhaps be an issue of contention in global competition.

But it's not the type of resource you were asking about, right?

 

[Jaskalas]

Originally posted by: gevorg
So far we're still following the ancient tradition of whoever discovered first, keeps it monopolized for many decades to come (for example: Rockefeller's Standard Oil to Chevron/etc).

So you're preaching the values of the commune, as professed by the Communist Manifesto. Cute, but this would be presuming that people and their private property are actually government property. Seems contradictory to human rights to suggest that people cannot own things.

Where would you draw the line, do people even own themselves? How do they protect this without ownership of valuable things? How would the people have any say or power without the origin of that power?

 

[blackangst1]

Originally posted by: Craig234
Situational. There are always going to be 'private interests' happy to grab 'ownership' of anything they can profit from, and that can be excessive and expooitave.

However, there are also times a for-profit service makes sense and some resources can well be 'privatized' in those cases.

The private-capital fad a bit ago to try to buy as much fresh water in the world as they could so they could then resell it to humanity who absolutely needs it, is a bad policy IMO.

It's a concidence you post this the same day I heard a news story about how China, who has 90% of the world's rare earth minerals, is tightening its access to them.

These are used in products from wind turbines (which China is the world's technology leader in) to Prius engines to Blackberries to missile guidance and other high tech devices.

nvm

 

[sandorski]

Ultimately the Resource belongs to the People, the People give Government tasks that usually include Resource Management, and Governments grant(if given Responsibility over Resources) Resources to certain Private Interests to exploit.

If the Nation does not somehow significantly benefit from whomever Owns the Resource, then someone is squandering. This is often the case in Africa, where a few powerful Elite Sellout a Nations Resources for personal gain while the People see no benefit at all.

 

[desy]

In Canada
The provinces own natural resources not the Federal government although the Crown controls any water where fish exist naturally. . .
The province then sets up lease rights and royalties and then private companies bid

 

[Tom]

Originally posted by: spidey07
Why do you guys hate profit so much? This is like the 4th post in a few hours that think profits are bad or somehow unjust. The government has no business owning any natural resource even though I know it happens today, it still doesn't make it right.

How about we keep it private and FOR PROFIT so companies continue to innovate on finding and using those natural resources?

The easy cons of government ownership would be price fixing, higher cost, inefficient, rationing and control. No pros that I can think of.

Profit drives efficiency and expansion.

also drives greed, mismanagement, destruction, and death.

of course so can public enterprise.

Pros of public ownership..more likely to consider long range consequences of development, more likely to consider public value such as recreation, tourism, water and soil conservation, etc.

btw, a better way to consider natural resources is who should develop them, or decide not to, rather than who should own them.

Our current way of doing this works pretty well, as opposed to how it was done a few decades ago, which lead to unnecessary and reckless destruction and depletion of resources like timber, fish, great lakes, strip mines, water pollution.

 

[BigDH01]

Originally posted by: spidey07
Why do you guys hate profit so much? This is like the 4th post in a few hours that think profits are bad or somehow unjust. The government has no business owning any natural resource even though I know it happens today, it still doesn't make it right.

How about we keep it private and FOR PROFIT so companies continue to innovate on finding and using those natural resources?

The easy cons of government ownership would be price fixing, higher cost, inefficient, rationing and control. No pros that I can think of.

Profit drives efficiency and expansion.

Actually, in a perfect market profits above normal profits (opportunity costs) are a strict measure of market inefficiency. We can discuss opportunity costs later (on my way out the door) and how it pertains to publicly held companies.

It is especially useful when considering markets like oil which basically provide products that are perfectly substitutable which also have relatively inelastic supply. It is quite easy for these companies to price signal each other and set a floor (and almost a necessity). Thus, any efficiency gained only leads to increased margins, not reduced cost.

Also, in a Coasian bargaining situation, profits can lead to ineffiency. I can discuss this further when I return, but public ownership of certain natural resources such as air, water, land, etc, can lead to Pareto superior outcomes.

 

[CPA]

Originally posted by: spidey07
Why do you guys hate profit so much? This is like the 4th post in a few hours that think profits are bad or somehow unjust. The government has no business owning any natural resource even though I know it happens today, it still doesn't make it right.

How about we keep it private and FOR PROFIT so companies continue to innovate on finding and using those natural resources?

The easy cons of government ownership would be price fixing, higher cost, inefficient, rationing and control. No pros that I can think of.

Profit drives efficiency and expansion.

It's like reading Atlas Shrugged via the threads on P&N. It is quite scary.

 

[BoberFett]

Originally posted by: gevorg
So far we're still following the ancient tradition of whoever discovered first, keeps it monopolized for many decades to come (for example: Rockefeller's Standard Oil to Chevron/etc).

What are the pros and cons if the state and/or federal governments would own the companies that involve in natural resource extraction? Or just keep them private but non-profit (i.e. all profit is fully taxed unless its approved for R&D).

You seem to be unfamiliar with the concept of mineral rights and that states tend to keep that to themselves.

 

[yllus]

The people of whatever nation tend to get a cut when the private sector extracts oil from the ground they live upon. Since that's usually the case (at least in the West) and it's the private sector, with profits as their goal, that usually are the most efficient at the extraction process, I figure private and for profit works out best for everyone.

 

[Schadenfroh]

Originally posted by: TheSkinsFan

Originally posted by: blackangst1
Private and for profit.

this.

Indeed, private citizens can get in on the action by purchasing stock in the mining / drilling companies and receiving dividends or they can allow said companies to make use of their land / mineral rights in exchange for royalties.

 

[Tequila]

Originally posted by: Schadenfroh

Originally posted by: TheSkinsFan

Originally posted by: blackangst1
Private and for profit.

this.

Indeed, private citizens can get in on the action by purchasing stock in the mining / drilling companies and receiving dividends or they can allow said companies to make use of their land / mineral rights in exchange for royalties.

this.

Invest in companies who's products you use. For me on an almost every day basis that's Chevron, Wells Fargo, Whole Foods, Coca-Cola, AT&T and JNJ. Dividends and especially dividend reivestment in your IRA is how you can profit indirectly in a very nice way.

 

[blackangst1]

Originally posted by: Tequila

Originally posted by: Schadenfroh

Originally posted by: TheSkinsFan

Originally posted by: blackangst1
Private and for profit.

this.

Indeed, private citizens can get in on the action by purchasing stock in the mining / drilling companies and receiving dividends or they can allow said companies to make use of their land / mineral rights in exchange for royalties.

this.

Invest in companies who's products you use. For me on an almost every day basis that's Chevron, Wells Fargo, Whole Foods, Coca-Cola, AT&T and JNJ. Dividends and especially dividend reivestment in your IRA is how you can profit indirectly in a very nice way.

Yep. I never understood why people whine about energy profits when they can reap profits as well.

Keep an eye on BP oil in UK. This 1 billion barrel new discovery is HUGE.

 

[magomago]

Originally posted by: yllus
The people of whatever nation tend to get a cut when the private sector extracts oil from the ground they live upon. Since that's usually the case (at least in the West) and it's the private sector, with profits as their goal, that usually are the most efficient at the extraction process, I figure private and for profit works out best for everyone.

It depends how big that cut is. And it depends on where the company is and where its looking to go.

I do think it is key that you said "Atleast in the West". Exploiting ones of own resources is key to this. Let us pause and think about situations where you have foreign investors trying to play the game.
Look at Iraq right now. Huge debate back when the oil ministry offered contracts out for oil fields. Many within Iraq said "NO, simply hire the technical expertise to help us rebuild and pay to train us so we can handle things ourselves". Many oil companies outside of the country bitched because they wanted a much bigger cut than they got (IIRC, they wanted to fill a quota, and anything outside the quota goes to them....instead they got a very low flat fee per barrel extracted over the agreement of the contract) and many simply didn't accept the offers. No doubt politics is involved in this and completely restructures the question. The question of who owns the natural resources still exists, but the dynamics aren't about public vs private profit, its about whether or not the political power exists to say who, in practice, owns the resources.

Other places like the Niger River Delta is even a larger clusterfuck.

So for exploiting one's own resources within one's own land for use within one's own country, private and for profit all the way....its a limited scope, but the dynamics almost completely change when you consider other situations that i feel a limited scope is really the only way to honestly answer the question without either being a liar, or just stupid.