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Why should a concession made by a monarch pre-constitutional revolution be expected to be upheld by a democratically elected leader operating after significant

by wz1000 6y ago

Why should a concession made by a monarch pre-constitutional revolution be expected to be upheld by a democratically elected leader operating after significant changes in the form and nature of government? I have noticed all such principled defenses of "property rights" and "capitalism" are built upon a very specific and convenient view of what exactly counts as "legitimate property". Was the oil even the Shah's to give away in the first place?

totalZero 6y ago
Why should a treaty signed by Obama be expected to be upheld by Trump? Continuity of governance, honoring good-faith agreements, maintaining confidence of foreign investors...the list goes on. Are you suggesting that all governmental responsibilities ought to be thrown out the window every time power changes hands? This is not a realistic perspective in most of the third world, where power changes hands frequently and change of government is often established via change of regime. Ultimately Iran made a killing on the oil business, and that would never have happened without petroleum concessions. In the parlance of the oil business, a "concession" is a deal where the host government allows oil rights in return for profit share, ownership, or some other financial benefit. It is an asymmetrical but symbiotic contract, and the term doesn't carry the same pejorative connotation as it would in standard parlance. Not to mention that the monarch in question was also the one who ratified the Persian Constitution of 1906.
- wz1000 6y ago
  I expect you to be cheering when Iran assassinates Trump for reneging on the nuclear deal and killing a high level general (among a laundry list of aggressive actions) and installs its own puppet. > Are you suggesting that all governmental responsibilities ought to be thrown out the window every time power changes hands? Governments have responsibilities to their own citizens, not foreign corporations. In the end the person with the biggest stick wins, but lets not pretend like overthrowing democratically elected governments for access to natural resources from their land is a moral imperative.
  - totalZero 6y ago
    > I expect you to be cheering when Iran assassinates Trump I understand that the HN zeitgeist is not circumspect about topics like Iran and petroleum because there is a strong distaste for anything that seems imperialistic here, but that's not a reason to make uninformed arguments and accuse me of cheering the idea of someone's death. I'm making some fairly informative and historically accurate comments. If you disagree with the substance then please do so without accusing me of being inhumane. > Governments have responsibilities to their own citizens, not foreign corporations. Governments ensure citizens' prosperity by protecting economy and trade via foreign-facing agreements. The beneficiaries of smart foreign trade are the citizens themselves. Iran is an example of this; its government's budget has been funded almost entirely by petroleum revenue for decades.
    - wz1000 6y ago
      > If you disagree with the substance then please do so without accusing me of being inhumane. I'm not accusing you of being inhumane. I'm wondering if you would apply similar moral standards when the shoe is on the other foot, or if you are a hypocrite.
  - oh_sigh 6y ago
    > I expect you to be cheering when Iran assassinates Trump for reneging Trump pulled a lever that was explicitly listed and offered in the treaty. It was not "reneging" on the deal any more than using a backout clause is reneging on a home purchase. Yes, it is rarely used, and yes, you may piss off the counter party who was really hoping for their payday, but the fact remains that the possibility is explicitly listed in the contract.
    - wz1000 6y ago
      Assassinating Soleimani was definitely not explicitly listed on any treaty.
- Imnimo 6y ago
  I think that people would question whether the agreement was in fact good-faith. The British company had agreed to various obligations to improve the working conditions of Iranian workers, train more Iranians to work in administrative roles, and generally contribute to the development of infrastructure in the country. It had done none of those things in the decades since signing the deal. Under that light, it's not really a case of buyer's remorse, where Iran signed a fair deal, and unjustly decided to renege on it. It's a case of the British company acting exploitatively, violating their agreement, refusing to renegotiate, and the Iranians declaring the agreement void as a result.
  - totalZero 6y ago
    Are we talking about the D'Arcy Concession? I ask because none of what you are describing is found in the text of that agreement. It's immediately obvious upon observation of modern Iran's highly developed petroleum industry that concessions sparked the development of infrastructure on a massive scale. > Under that light, it's not really a case of buyer's remorse, where Iran signed a fair deal, and unjustly decided to renege on it. I think it's precisely a case of buyer's remorse. In Iran prior to the development of infrastructure, 16% share in profits generated by AIOC with no initial capital commitment from the Qajars sounds like a great deal. In Iran after the wells are pumping, 16% share in profits sounds like a pittance. I reject your framing of the issue as an exploitation by British interests. That may be a palatable narrative for the times we live in today, but it's a distorted perception of the actual facts. Petroleum production was the single greatest driver of wealth and development in 20th century Iran. If not for foreign investment, the industry could not have boomed as it did. D'Arcy took massive personal risk and even took the British government as an investor, but he failed several times in the process of exploring for oil before he was ultimately successful. Risk is the nature of the wildcatting business. If you study the process of oil rights and nationalization in the Middle East, you will see that it is a topic marked by extremely brutish behavior from local parties as well as faraway beneficiaries like the US and the UK. Even OPEC is full of deception about production numbers as it sets production amongst member nations. For that reason as well as others beyond the scope of the current conversation, there aren't many clean hands in the oil production business. Look at the massive corruption and cronyism taking place in Venezuela's PDVSA. Iran has the same kind of problem, where the country's dictators finance their corrupt practices using petroleum income.
- anigbrowl 6y ago
  Wait a moment, you're equating a change of administration (Obama - Trump or any preceding transfer of power in the US) with a change of governance, as in a structural change in the system of governance (which is explicitly spelled out in the comment you were replying to). It's particularly odd that you make this argument given Trump's unilateral withdrawal from the P5+1 agreement as well as many other bi- and multilateral arrangements. If we're just going to rely on realpolitik, why not accept that the oil companies also made bank out of Iran for a while and hey, nothing lasts forever?
  - totalZero 6y ago
    > Wait a moment, you're equating a change of administration ... with a change of governance In the context of a monarchy, that's the appropriate way to consider it. When Reza Shah Pahlavi took power from the Qajars, the deals with the British remained. There is a level of continuity of governance that exists in the developed West but doesn't exist in the Third World. Ecuador for example was until recently an OPEC nation, but it has had twenty constitutions. However, it is in the nation's best interests, economically speaking, to ensure a peaceful transition of operation across those political perturbations. (I am reminded of software revisions that do not alter the API, so that the software can be treated like a black box and mated to applications without a rewrite of API calls every time revisions are made.) A current example would be Argentina, where the return of Cristina Kirchner to the country's executive branch has spooked foreign investors (including miners and petroleum companies) because she froze the dollar during her presidency about a decade ago. Ultimately this has a very damaging effect on the country's economy and its people's ability to eat. In present-day Argentina, we see economic investment chilled by a new administration that operates under the same constitution but endangers foreign investors. In early-20th-century Iran, we saw economic activity boosted by continuity of international agreements across several different monarchical administrations within two separate dynasties. Please choose the correct lens when you are evaluating a third-world country's economy. What we all learned in social studies class about the differences between regimes, governments, etc.....well it is not necessarily applicable to developing nations where change of administration is frequently carried out by coup or the establishment of a new constitution that is as ephemeral as the previous one. I tried to communicate this succinctly in my earlier post, quoted here: > Are you suggesting that all governmental responsibilities ought to be thrown out the window every time power changes hands? This is not a realistic perspective in most of the third world, where power changes hands frequently and change of government is often established via change of regime.
- jessaustin 6y ago
  Why should a treaty signed by Obama be expected to be upheld by Trump? I would have sworn there was such a treaty... I think the Europeans still abide by it? Do you agree with Trump's rejection of that treaty?

by wz1000 6y ago

totalZero 6y ago

Why should a treaty signed by Obama be expected to be upheld by Trump? Continuity of governance, honoring good-faith agreements, maintaining confidence of foreign investors...the list goes on. Are you suggesting that all governmental responsibilities ought to be thrown out the window every time power changes hands? This is not a realistic perspective in most of the third world, where power changes hands frequently and change of government is often established via change of regime. Ultimately Iran made a killing on the oil business, and that would never have happened without petroleum concessions. In the parlance of the oil business, a "concession" is a deal where the host government allows oil rights in return for profit share, ownership, or some other financial benefit. It is an asymmetrical but symbiotic contract, and the term doesn't carry the same pejorative connotation as it would in standard parlance. Not to mention that the monarch in question was also the one who ratified the Persian Constitution of 1906.

wz1000 6y ago
I expect you to be cheering when Iran assassinates Trump for reneging on the nuclear deal and killing a high level general (among a laundry list of aggressive actions) and installs its own puppet. > Are you suggesting that all governmental responsibilities ought to be thrown out the window every time power changes hands? Governments have responsibilities to their own citizens, not foreign corporations. In the end the person with the biggest stick wins, but lets not pretend like overthrowing democratically elected governments for access to natural resources from their land is a moral imperative.
- totalZero 6y ago
  > I expect you to be cheering when Iran assassinates Trump I understand that the HN zeitgeist is not circumspect about topics like Iran and petroleum because there is a strong distaste for anything that seems imperialistic here, but that's not a reason to make uninformed arguments and accuse me of cheering the idea of someone's death. I'm making some fairly informative and historically accurate comments. If you disagree with the substance then please do so without accusing me of being inhumane. > Governments have responsibilities to their own citizens, not foreign corporations. Governments ensure citizens' prosperity by protecting economy and trade via foreign-facing agreements. The beneficiaries of smart foreign trade are the citizens themselves. Iran is an example of this; its government's budget has been funded almost entirely by petroleum revenue for decades.
  - wz1000 6y ago
    > If you disagree with the substance then please do so without accusing me of being inhumane. I'm not accusing you of being inhumane. I'm wondering if you would apply similar moral standards when the shoe is on the other foot, or if you are a hypocrite.
- oh_sigh 6y ago
  > I expect you to be cheering when Iran assassinates Trump for reneging Trump pulled a lever that was explicitly listed and offered in the treaty. It was not "reneging" on the deal any more than using a backout clause is reneging on a home purchase. Yes, it is rarely used, and yes, you may piss off the counter party who was really hoping for their payday, but the fact remains that the possibility is explicitly listed in the contract.
  - wz1000 6y ago
    Assassinating Soleimani was definitely not explicitly listed on any treaty.
Imnimo 6y ago
I think that people would question whether the agreement was in fact good-faith. The British company had agreed to various obligations to improve the working conditions of Iranian workers, train more Iranians to work in administrative roles, and generally contribute to the development of infrastructure in the country. It had done none of those things in the decades since signing the deal. Under that light, it's not really a case of buyer's remorse, where Iran signed a fair deal, and unjustly decided to renege on it. It's a case of the British company acting exploitatively, violating their agreement, refusing to renegotiate, and the Iranians declaring the agreement void as a result.
- totalZero 6y ago
  Are we talking about the D'Arcy Concession? I ask because none of what you are describing is found in the text of that agreement. It's immediately obvious upon observation of modern Iran's highly developed petroleum industry that concessions sparked the development of infrastructure on a massive scale. > Under that light, it's not really a case of buyer's remorse, where Iran signed a fair deal, and unjustly decided to renege on it. I think it's precisely a case of buyer's remorse. In Iran prior to the development of infrastructure, 16% share in profits generated by AIOC with no initial capital commitment from the Qajars sounds like a great deal. In Iran after the wells are pumping, 16% share in profits sounds like a pittance. I reject your framing of the issue as an exploitation by British interests. That may be a palatable narrative for the times we live in today, but it's a distorted perception of the actual facts. Petroleum production was the single greatest driver of wealth and development in 20th century Iran. If not for foreign investment, the industry could not have boomed as it did. D'Arcy took massive personal risk and even took the British government as an investor, but he failed several times in the process of exploring for oil before he was ultimately successful. Risk is the nature of the wildcatting business. If you study the process of oil rights and nationalization in the Middle East, you will see that it is a topic marked by extremely brutish behavior from local parties as well as faraway beneficiaries like the US and the UK. Even OPEC is full of deception about production numbers as it sets production amongst member nations. For that reason as well as others beyond the scope of the current conversation, there aren't many clean hands in the oil production business. Look at the massive corruption and cronyism taking place in Venezuela's PDVSA. Iran has the same kind of problem, where the country's dictators finance their corrupt practices using petroleum income.
anigbrowl 6y ago
Wait a moment, you're equating a change of administration (Obama - Trump or any preceding transfer of power in the US) with a change of governance, as in a structural change in the system of governance (which is explicitly spelled out in the comment you were replying to). It's particularly odd that you make this argument given Trump's unilateral withdrawal from the P5+1 agreement as well as many other bi- and multilateral arrangements. If we're just going to rely on realpolitik, why not accept that the oil companies also made bank out of Iran for a while and hey, nothing lasts forever?
- totalZero 6y ago
  > Wait a moment, you're equating a change of administration ... with a change of governance In the context of a monarchy, that's the appropriate way to consider it. When Reza Shah Pahlavi took power from the Qajars, the deals with the British remained. There is a level of continuity of governance that exists in the developed West but doesn't exist in the Third World. Ecuador for example was until recently an OPEC nation, but it has had twenty constitutions. However, it is in the nation's best interests, economically speaking, to ensure a peaceful transition of operation across those political perturbations. (I am reminded of software revisions that do not alter the API, so that the software can be treated like a black box and mated to applications without a rewrite of API calls every time revisions are made.) A current example would be Argentina, where the return of Cristina Kirchner to the country's executive branch has spooked foreign investors (including miners and petroleum companies) because she froze the dollar during her presidency about a decade ago. Ultimately this has a very damaging effect on the country's economy and its people's ability to eat. In present-day Argentina, we see economic investment chilled by a new administration that operates under the same constitution but endangers foreign investors. In early-20th-century Iran, we saw economic activity boosted by continuity of international agreements across several different monarchical administrations within two separate dynasties. Please choose the correct lens when you are evaluating a third-world country's economy. What we all learned in social studies class about the differences between regimes, governments, etc.....well it is not necessarily applicable to developing nations where change of administration is frequently carried out by coup or the establishment of a new constitution that is as ephemeral as the previous one. I tried to communicate this succinctly in my earlier post, quoted here: > Are you suggesting that all governmental responsibilities ought to be thrown out the window every time power changes hands? This is not a realistic perspective in most of the third world, where power changes hands frequently and change of government is often established via change of regime.
jessaustin 6y ago
Why should a treaty signed by Obama be expected to be upheld by Trump? I would have sworn there was such a treaty... I think the Europeans still abide by it? Do you agree with Trump's rejection of that treaty?