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An Iraqi who saved Norway from oil (2009)
- ethbro 8y agoThanks to everyone who mentioned this in previous comments. It's a fascinating bit of history. https://news.ycombinator.com/item?id=19593054 https://news.ycombinator.com/item?id=19593054
- djrobstep 8y agoLiving in Australia it breaks your heart to see how much this country has squandered a similarly historic natural resources boom. Instead of taxing it heavily and using it to build an enormous pool of money for the common good, we've simply handed it over to private interests. Australia has also squandered opportunity in its retirement system: 2.6 trillion in high fee individual accounts (1% given away to the financial sector in fees every year!) instead of in a sovereign wealth fund like Norway's with a fraction of the admin costs. Every country with an interest in a wealthy, fair society should be following in Norway's footsteps. Fun fact: Norway is mostly socialist. The government owns the majority of the country's wealth.
- deleted 8y ago[deleted]
- netsharc 8y agoSomeone replied to you but he deleted it. I meant to continue the conversation with: If this article (referencing a 2008 paper) https://www.theguardian.com/commentisfree/2014/jan/13/north-sea-oil-money-uk-norwegians-fund https://www.theguardian.com/commentisfree/2014/jan/13/north-... is to be believed, the UK had the same thing, but the money went to tax cuts for the rich. So it does smell like corruption to me. [He talked about some conservative governments being corrupt, to which I think:] Conservatism is a con anyway, selling austerity as a pain that the citizenry needs to suffer to get a "healthy economy", which means cutting budgets where somehow the solution is to outsource things (e.g. with the NHS), meaning the private companies owned by the elites rake in the money. And then they sell the "it's the immigrants who are overtaxing our resources" to get the public to vote for Brexit. (Where less EU regulations mean the elite will have more power to influence the government to allow worker exploitation)
- Thlom 8y agoIn Norway it’s EU regulations that makes it easier for the conservatives (and the last 20-30 years the social democrats) to privatize the economy and exploit workers. EU is a neoliberal project with some benefits for the common man.
- vnorilo 8y agoNorway is not in the EU.
- deleted 8y ago[deleted]
- lixtra 8y agoNonetheless, plenty of EU driven rules apply in Norway. So gp’s statement could be true. https://en.m.wikipedia.org/wiki/Norway–European_Union_relations https://en.m.wikipedia.org/wiki/Norway–European_Union_relati...
- village-idiot 8y agoMostly around trade, so that Norwegian products can be sold in the EU and vice versa without secondary inspections. Only 21% of EU laws apply to Norway, and I don’t see any evidence that the EU could do anything like force Norway to privatize things.
- thefounder 8y agoHow did you come to that conclusion? My complain with EU was it's driven too much by social(ist) policies at least compared with the US? At least the money that goes into small agriculture is upsetting.
- lenticular 8y agoThe EU is quite neoliberal. Austerity was the policy there after the recession. It has also presided over a massive financialization of the European economy. The US is far out of the political mainstream with other wealthy countries. In comparison to where they were 20 years ago (as opposed to where the US is now), Europe has shifted markedly right economically. The subsidies of agriculture are kind of ludicrous, I agree.
- ancorevard 8y agoI don’t know what your definition of socialism is which makes it difficult to respond to you. But in any historical manner, Norway is not a socialist society. We now have more freedom of choice in the market place than most countries and also compared to our own history. Norway was more socialist after the Second World War, where many industries was built up by the government. But since the 80s our government slowly divested from almost all these industries leading to much more affordable prices and greater competition. It’s a great country to start up companies and create wealth. There are aspects of Norway that is socialist, but the country by historical standards and by the very definition is far far from being socialist. It is difficult to categorize countries as socialist or free markets, since all countries has a bit of a mix. However, it is easy to see what it is decidedly not. Compared to socialist countries like USSR, East Germany, North Korea, Venezuela, we can all agree that Norway is not like those, it is indeed far closer to free markets than compared to socialism.
- EGreg 8y agoMost people use the word socialism incorrectly. They look at social democracy which is just markets with redistribution and safety nets, and they say “socialism”. Any welfare programs that help the poor - they say “socialism”. They look at cities and countries engaging in State Capitalism and call it socialism. Socialism is collective ownership of the Means of Production. Examples of textbook socialism include: Communes and Kibbutzes Co-operative housing Credit Unions Employee owned corporations Open source projects And you can have democratic governance of larger structures, which MAY be called socialism: The public stock market (capitalism and socialism can coexist).
- gcb0 8y agoand then there's the definition from countries too close to nazi germany and/or the ussr at some point in its history: a term they will politely but enfaticaly deny, always.
- FranzFerdiNaN 8y agoNazi Germany was of course an example of national-socialism, which was a branch of fascism, not socialism. The name is very difficult for people to understand (although loads of people willfully misunderstand it), but saying it was socialism is like saying the Democratic People's Republic of Koreais an example of why democracy or republicanism is terrible.
- EGreg 8y agoRussia squanders it all the time
- nugget 8y agoI wouldn't call Norway socialist so much as credit them for having had excellent governance. They invested the taxes they collected very wisely for the long-term common good of their citizens. Any country with any system of governance would be capable of this, but it turns out most human beings when given sufficient political power tend towards corruption and waste. Alaska, in the US, has followed a similar model to Norway with the Alaska Permanent Fund. Alaska issues annual dividend checks to every resident which is, as far as I know, the closest thing to a working UBI model in the world.
- wwweston 8y agoSo... sufficiently good governance pursuing the general welfare of citizens is indistinguishable from socialism? ;)
- kebman 8y agoBecause Socialism implies nationalizing private companies. Norway does not. In fact the last 50 years they've done nothing but privatization, while retaining stocks in certain key businesses - which is nothing like the traditional autocratic control known from Socialism. Heavy taxation is also not Socialism. Otherwise the British taxation of their American colonies could be deemed to be the same, while they were clearly not. Instead (largely) American companies accept the heavy taxation of the oil industry in Norway for two reasons. First of all, it is on sovereign Norwegian territory. Second, they still go home with a cool profit at the end of the day. Keeping the tax profits from that venture, and investing it in order to make it grow, is not Socialist either. In fact that could be seen as directly contrary to Socialist doctrines. In fact it can be viewed as a completely Capitalist doctrine! But one where the people benefits from those invesments, since the Sovereign Wealth Fund is designed to work for the benefit of its owners, who just happens to be the Norwegian people.
- CryptoPunk 8y ago>>Australia has also squandered opportunity in its retirement system: 2.6 trillion in high fee individual accounts (1% given away to the financial sector in fees every year!) instead of in a sovereign wealth fund like Norway's with a fraction of the admin costs. There are advantages to having hundreds of thousands of individual accounts over one sovereign wealth fund. The latter is a case of putting all your eggs in one basket. Centralization poses enormous risks. Reducing fees by having a smaller number of fund managers managing a larger amount of capital can also reduce the ROI, as a result of fund managers having to limit their objects of investment to very large companies/projects that can efficiently utilize large capital infusions.
- djrobstep 8y agoSeems to me it's the opposite. The holdings of the Norway fund are more diversified than any given Australian fund, simply because a larger pie can be sliced up into more slices. You can view the Norway fund's holdings on their website: https://www.nbim.no/en/the-fund/holdings/holdings-as-at-31.12.2018/ https://www.nbim.no/en/the-fund/holdings/holdings-as-at-31.1... It seems pretty diversified to me! A larger fund also has advantages for ROI (even putting aside the much lower fees) because you can be a more activist shareholder and invest in more sophisticated ways.
- CryptoPunk 8y agoOf course a gigantic fund will be more diversified than any single small fund. But the aggregate diversity of all of the funds that all of the individual accounts invest in will be greater than that of any single fund. >>A larger fund also has advantages for ROI (even putting aside the much lower fees) because you can be a more activist shareholder and invest in more sophisticated ways. Small fund managers are free to invest in large funds to gain these advantages. They have the added advantage of being able to select from smaller cap investment options as well.
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- tryptophan 8y ago
- black-tea 8y agoI had a Norwegian girlfriend for a time and I can tell you they just think differently to us (British) people. While in Britain, and by extension the US, people just want more, more, more and constantly thin they are being ripped off, in Norway they feel happy with what they already have and think in very modest terms. She was one of the few women I've dated who didn't go shopping for fun every week. Very refreshing for me as a frugal person aiming to retire early. I miss her actually.
- njepa 8y agoI think an important point to make is that it isn't that people in the Nordic countries are happier with less as such. It is that they already have, or have access to, the things they need to be relatively happy. If you don't then of course it is a constant struggle to compensate. Unfortunately I think this is rapidly changing.
- germinalphrase 8y agoI would be curious what the advertising landscape is like in Norway vs (for instance) the US. Clearly many Americans have their essential needs covered, and yet there seems to be a constant advertising driven pull for more and more to achieve ‘real’ happiness.
- njepa 8y ago> Clearly many Americans have their essential needs covered [...] Not in the same way. You can even be quite wealthy and still have very negative consequences from getting fired, evicted or having the housing market crash. Not only as result of the direct or financial consequences, but also to your sense of freedom and self-image. I guess you could say that the Nordics at their best isn't so much about being happy, as in the pursuit of happiness, but about being trouble free.
- gniv 8y agoI have recently learned about Janteloven, and it was a revelation when trying to understand the people in the Nordic countries: https://en.wikipedia.org/wiki/Law_of_Jante https://en.wikipedia.org/wiki/Law_of_Jante
- StreamBright 8y ago>> Fun fact: Norway is mostly socialist. The government owns the majority of the country's wealth. This is not the definition of socialism. "The Nordic model refers to the economic and social policies common to the Nordic countries (Denmark, Finland, Norway, Iceland, Greenland, the Faroe Islands, and Sweden). This includes a comprehensive welfare state and collective bargaining at the national level with a high percentage of the workforce unionised while being based on the economic foundations of free market capitalism."
- djrobstep 8y agoIt absolutely is the definition of socialism: socialism is common ownership of the means of production. Most of Norway's wealth is government-owned, thus it is mostly socialist. I'm not sure why people get so vehement about denying this fact. Perhaps because it requires acknowledging that socialism actually works really well?
- Gravityloss 8y agohttps://en.wikipedia.org/wiki/Social_democracy https://en.wikipedia.org/wiki/Social_democracy I think social democracy is probably closer. There's free enterprise and the government owns some part of some companies.
- holenda 8y agoMost of Norway's wealth is definitely not owned by the government, where do you get this from? It's mostly owned by corporation's and the people. Statoil and some other large companies are partly owned by the government, but there are many wholly owned privat oil companies competing with them.
- StreamBright 8y agoI am not sure why wikipedia disagrees with you. Probably because Norway is not a socialist country. Government is not equal to the workers. If workers owned means of production, it would have been a socialist country. This is simply not true. Most of companies in Norway are not owned by workers. I gues this will help you to understand: "Ownership: In a capitalist economy, property and businesses are owned and controlled by individuals. In a socialist economy, the state owns and controls the major means of production. In some socialist economic models, worker cooperatives have primacy over production" Finally, no socialism never has been working very well. There is not a single example of it working well in all recorded human history.
- kebman 8y agoIt is a complete myth that Norway is "mostly socialist". Norway is a market economy with a strong focus on regulation and welfare for its people. If it was Socialist, it would have nationalized all private property by now - which it haven't, and in fact it is in the process of privatizing even more previously state-owned products and services. Heavy taxation does not imply Socialism, although the Sovereign Wealth Fund can certainly be attributed to the Labour movement of Norway.
- cygx 8y agoSocialism does not mean government ownership of the means of production: Remember, anarchism (think Proudhon, Bakunin) is also part of the socialist movement...
- village-idiot 8y agoI believe “Democratic Socialist” would be the correct term for their market arrangement: free market with a strong government backdrop against poverty or illness.
- sundvor 8y agoYep. Try being a Norwegian living in Australia and seeing up close how they've done it all wrong. To explain it is like talking about the rainbow to someone born 100% blind; the corruption and ineptitude just stinks. The same goes for their attitudes towards taxing pollution / promoting EVs, but that's a side story.
- dade_ 8y agoAnd apparently no effective oversight of their largest financial institutions: https://www.news.com.au/finance/business/breaking-news/chronican-shocked-at-depth-of-misconduct/news-story/0b73c63d799547334094cdd4f0e4cff9 https://www.news.com.au/finance/business/breaking-news/chron... The stories about Rosemary Rogers are bewildering.
- njepa 8y agoUnfortunately it might be even more frustrating seeing the Nordic countries trying to dismantle any good idea and advantage they had. Hopefully Norway has enough inertia to not squander the fund.
- GordonS 8y agoI'm Scottish and kind of feel the same way - Scotland has a similar population to Norway, but Scotland has little to show for decades of oil and gas extraction. I really wish we'd started a fund like Norway did :(
- unixhero 8y agoThe fun fact is incorrect: Not correct. Norway's form or government is Social Democratic. A progressive form of modern democracy. Mind you; Our government is this season run by a coalition of a center right and a right wing party.
- btrettel 8y agoBy coincidence, I recently watched the first episode of a TV show where Norway's oil resources contribute to a different kind of trouble. https://en.wikipedia.org/wiki/Occupied https://en.wikipedia.org/wiki/Occupied
- pizza 8y agoOccupied is pretty good! Check out Nobel if you want to watch another Norwegian political thriller with a focus on the interplay between energy resources and international relations- this time about a Norwegian guy who comes home from Afganistan only to become a pawn for international politics
- btrettel 8y agoThanks for the recommendation.
- gdy 8y agoIt is russophobic. The idea of Russia invading Norway to resume Norwegian oil production because the EU asked it is absurd. Were it to happen in real life, Russia would be applauding Norway for rising the oil price and ramping up its own oil production as much as it can.
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- Abishek_Muthian 8y ago>their youngest son “completely transformed” by the treatment he received in Norway Even though he didn't get enough credit for the work he had done, his goal to provide better health care for his son is fulfilled; that should provide him the satisfaction above everything else.
- peteretep 8y ago> that should provide him the satisfaction above everything else Being a good parent above all other considerations is not a universally held moral.
- village-idiot 8y agoWe can assume that it’s one that the subject shares though, considering how much risk he and his wife were willing to tolerate to get their son better treatment.
- peteretep 8y agoWhat him and his wife were willing to risk: moving to Norway, when one of them was Norwegian, from Iraq.
- village-idiot 8y agoThe article makes it very clear he had planned to give up his career, and they had to effectively smuggle themselves out of the country. The government was tracking him so they knew who to grab if they nationalized the oil.
- benj111 8y agoTo me this is a story of immigration. Europe is currently 'struggling' with immigration, the subtext being they don't bring skills, lower wages for the poorest, etc. Here you have an immigrant that brings massive wealth to a country, (and he's essentially a healthcare tourist!)
- ThJ 8y agoThe United States is in the privileged position of attracting the best and the brightest. Also, it, together with the rest of the anglosphere, attracts the people who speak English. Many of the people who come to countries like Norway, France and the Netherlands are less resourceful, mostly poor refugees. They didn't receive an education in any western language, so it doesn't matter which country they pick, so long as it's safe and there is money there.
- benj111 8y agoI'm British, and there's the same fears here, perhaps more so. So I'm not sure it's an english speaking thing. And looking at how Trump is behaving over the Mexican border, the US has the same fears also. But yes the US probably does do better at attracting the most talented, certainly in the tech industry.
- njepa 8y ago> They didn't receive an education in any western language, so it doesn't matter which country they pick, so long as it's safe and there is money there. I wouldn't say so. While of course it is hard to be informed as a refugee, the big European countries are naturally much more well known. Refugees to some extent go to Nordic countries because they have heard that it is a place were you can get an apartment, a decent wage and there are resources so you can get on with your life. At this point they probably believe more in the Nordic model than we do ourselves.
- raverbashing 8y agoThere's a difference in education levels and ability to integrate - even at later generations. As you mentioned it, it was a healthcare tourist, not an immigrant per se. There's no point in bringing people to do the low-level jobs without much room to grow (or worse, do what Canada does and be overly selective then just keep people at survival jobs)
- Someone 8y agoFor those interested in what they invest in, that data is public: https://www.nbim.no/ https://www.nbim.no/. They hold, for example, 0.86% of Amazon, 1,34% of AMD, 0,97% of Apple, 0,33% of Facebook, 0,95% of Microsoft, and 0,8% of Tesla.
- achow 8y agoAmazing dashboard https://www.nbim.no/en/the-fund/holdings/holdings-as-at-31.12.2018/?fullsize=true https://www.nbim.no/en/the-fund/holdings/holdings-as-at-31.1...
- mips_avatar 8y agoSo I guess every Norwegian owns about $200 worth of Microsoft.
- CryptoPunk 8y ago>>Such resignation reflects bitter experience of the way that dependency on natural resources can poison a country’s economic and political system. Inflows of hard currency push up prices, squeezing the competitiveness of non-oil businesses and starving them of capital. As a result, productivity growth withers (a phenomenon known as “Dutch disease” after the negative effects of North Sea gas production on the Netherlands). That's an incorrect summation of the "Dutch Disease". Productivity growth doesn't suffer. Productivity growth, or GDP growth, increases with higher oil output. The Dutch Disease is a politically slanted term to describe how other industries languish when one expands. But a rise in oil production is not associated with declining productivity growth, and the Dutch Disease theory does not include that proposition. A rise in oil production/exports makes an economy more capital-rich, which raises productivity.
- throwaway284721 8y ago> Inflows of hard currency push up prices, squeezing the competitiveness of non-oil businesses and starving them of capital. This is true for any kind of industry that a country has a competitive advantage in.
- MrBuddyCasino 8y agoI think this true for London and Banking as well.
- pytester 8y agoThere's a vast difference in the effect on a country depending on whether its competitive advantage comes from resources or people though. If it comes from resources then the incentive to develop the people is lost and they're either bought off or ignored. Look at what happens in Russia or Venezuela or Saudi Arabia.
- throwaway284721 8y agoSo what's wrong with being bought off? People in Kuwait have it very well.
- pytester 8y agoIn the 17th century Bolivia was considered the richest country in the Americas because of the Potosi silver mine while the eastern seaboard of America was basically a poverty stricken nowhere. Now Bolivia is the poorest country in the Americas and the US is the richest. This is basically why. The answer is - it works fine until the resource price drops or you run out of it. Kuwait may be fat and content now but it has a dark future ahead of it once they stop being able to live off foreign cash.
- dredmorbius 8y agoNauru's birdshit apocalypse. https://www.nytimes.com/1995/12/10/world/a-pacific-island-nation-is-stripped-of-everything.html https://www.nytimes.com/1995/12/10/world/a-pacific-island-na...
- simonebrunozzi 8y agoFor the curious: the fund's current value is at $1.05 Trillion dollars (USD). With 5.3 million Norwegian, that equates to $198k per capita. Impressive. Also: "Since 1998 the fund has generated an annual return of 5.5 percent". Well done Norway, and well done Farouk al-Kasim. What a pity that the Iraqi government didn't let him run a similar scheme for the Iraqi oil. Things would be much different today.
- dankohn1 8y agoSuch an inspiring story. And so frustrating given the political push by Trump and Brexit to make it much harder for talented foreigners to immigrate.
- azernik 8y agoLittle throwaway bit: "Nor was it straightforward to resign from his job. When al-Kasim broke the news to his boss in London, “he said: ‘Damn you, Farouk. We were counting on you. Now you are letting us down.’” The top director put pressure on him to stay, but al-Kasim explained that only Norway offered the care his son needed. In the end, his superiors relented. “My immediate boss said: ‘I can’t promise you that you will get a job, but I can say now that we will not stop you getting one.’” And so no one interfered when Norway’s Ministry of Industry hired al-Kasim as a consultant. His job would be to analyse the North Sea exploration results – at a salary just above that of the prime minister." That he had to rely on the graciousness of his employer to refrain from blackballing him is still a reality for a lot of professionals.
- refurb 8y agoThe province of Alberta, Canada does something similar with it’s Heritage Trust Fund. 30% of royalties are put away. Current balance is $120B which is actually a lot considering the province has only 3M people (~$40,000 per person balance). However, it’s be rife with mismanagement.
- graeme 8y agoYou’re very wrong. The current bslance is about $15 billion Canadian. $190 billion was the non-renewable resource money generated. They only out 30% in, unlike Norway’s 100%, and they stopped adding money in 1987. Alberts has an estimated population of 4.3 million, so they have about $3500 per person only. https://en.m.wikipedia.org/wiki/Alberta_Heritage_Savings_Trust_Fund https://en.m.wikipedia.org/wiki/Alberta_Heritage_Savings_Tru... https://en.m.wikipedia.org/wiki/Alberta https://en.m.wikipedia.org/wiki/Alberta (For population stats)
- refurb 8y agoAhh.. looked at the wrong numbers. Regardless, if Alberta had done the same as Norway (100% of royalties), they still wouldn't have as much money in the fund.