Think, for a moment, about where you find oil.

One might imagine some far off land,

perhaps in the Middle East, where oil flows from the ground like geysers of wealth, only to be
robbed by multinational mineral resource corporations, where instead of being redistributed to
the people the wealth is stolen and only a fraction is given to a ruling bourgeois class. Or
perhaps, ones mind may drift to the icy tundras of Siberia, where if the cold doesnt kill you, the
incredibly corrupt government might, and here the proletariat, the working class is still under the
iron grip of the wealthy ruling class, whose positions are secured with dirty oil money.. The link
these imaginative places share is simple:oil. Now, for a moment, ponder what these three places
share:Alberta, Russia, Algeria. If one were to guess oil and how it has put in place seemingly
non-democratic regimes, one would be right. Oil then can be seen as a great corrupting agent,
where striking black gold is more of a curse than a blessing, constantly subjugating those tricked
into coming to work for corporations that rape the land for a profit. In fact, there is almost
nowhere that oil has not completely corrupted, save for perhaps Norway; however recently they
too are succumbing to the disease that is oil wealth. But why?
The answer is multifaceted. It comes from Andrew Nikiforuk and his work on how oil is
actively perpetuating single-party-ism in his home of Alberta, Canada. It comes from Terry Lynn
Karl and her in depth examination of petra states and her research in Venezuela. It comes from
Michael L. Ross paper Does Oil Hinder Democracy? where Ross outlines three explicit effects,
what he calls causal mechanisms: a repression effect, a rentier effect, and a modernization
effect, and it comes from many other notably minds in the field of democratization (Ross 2001).
Each of these effects in some way add to the non-democratic nature of petro-states. But Ross
misses one poisonous element in petro-states. Their incredibly powerful bourgeois class. Oil is
the worlds most lucrative and prevalent natural resources, and finding it under ones soil brings

about a massive storm of global corporations and attention. For example, if one were to examine
the political landscape of Alaska, one of America's youngest states, where of all jobs are tied to
the oil industry, where the state has collected 159 billion dollars since 1959, and where oil makes
up a staggering 90% of the total revenue stream for the state(AOGA 2015). The interesting part
here is that since 1964, Alaska has been ruled by the Republican Party. And Alaska is a good
place to start to explain the first effect Ross outlines, the Rentier Effect.
The term rentier state was truly defined by Hussein Madhavy, who described it as
those countries that receive on a regular basis external rent, where external rent is the
payment a country, state, or area may receive for the use of their land by private oil entities
(Madhavy 1972, 472). When a state is under the duress of the rentier effect, democratic
processes are normally inhibited by three separate effects, but for the purpose of this paper only
two will be discussed. Those being Ross theories on the taxation effect and the spending effect,
as they make the proletariat lazy and lame in effect. The taxation effect essentially boils down to
the government of the state relieving tax pressure because of the newly generated oil revenue
streams. Looking at the correlation between taxation and the demand for representation, they are
directly related, where if one is high, so to is the other. In the case of Alaska, their sales and use
tax rates are, at a state level, zero percent(State of Alaska 2010). Now, upon examination of
Alaska voter turnouts, in the 2006 election, the turnout rate was 51.1% of the total
population(State of Alaska 2006). Although a majority of the capable population did vote, it was
by an incredibly small margin. Which in theory signals not a true democratic process. This
means that because the proletariat do not feel any pressure, believing that life is ok, they are not
motivated to democratically act. Interestingly though, approximately 11.3% of the Alaskan
population live below the poverty threshold, with many more believed to be in that category in

far off regions that were not counted for by the Census. For the spending effect, the government
takes its new revenue, and uses the money for patronage. Patronage is an umbrella term, and this
makes it difficult to describe what exactly a regime might do to sustain its power; however,
patronage could for example be building a new hospital, or perhaps highway repairs. Tangible,
immediate effects that will eventually become defunct when the oil revenue streams go bust,
such as in the case of Malaysia which has approximately 9 years left of solid oil production and
is beginning to see a decline in public expenditure- or patronage (CIA 2015). The pressures of
losing such a valuable commodity and its effects on public expenditure can already be seen in
Malaysia, with security forces beginning to clash more and more often with dissident youth.
While not all of these issues are directly related to oil, it is worth noting that oil and gas jobs
account for 52,300 jobs in Malaysia(Malaysia Department of Labor and Employment 2012).
As outlined above, the second of Ross effects to be examined will be the Repression
effect. This is defined as the active use of military and police forces to repress the general
population of a given state. For this, we will examine the Democratic Republic of the Congo, and
how oil has lead to a dramatic uptick in the amount of violence and military presence in the
country. It can not be argued that given oils capacity to bring such a dramatic economic shift, the
need to protect it is unparalleled. This protection is often just as dramatic, where in the Congo
defense spending saw an increase in funding by almost 600%(Ross 2001). This new military
might is used to keep the population down when they do attempt to speak out against nondemocratic violence, such as in January of 2015, where President Joseph Kabila, president of the
DRC, allowed his troops to use violent means to quell public demonstrations against Kabila
attempting to rewrite the constitution so that he can run for a third term in office. But where does
the oil come in here? It comes from the almost 187 million barrels of oil produced by the DRC in

2012 (KPMG 2012). This level of production is massive, accounting for approximately 23% of
the total DRC employment, and with this level of employment and production, Kabila is able to
build up a large, and intimidatingly powerful, military presence that can be -and is- used to
suppress and repress the people of the DRC. The issue in the repression effect in regards to
Socialist theory and the proletariat in general is that the people demonstrating are from the city of
Kinshasa, a largely lower class area, are being brutally oppressed by the bourgeois that bases
most of its military expenditure on the exports of raping the environment for its natural
resources. Thus the chains of the proletariat are continually lubricated with the oil that the
bourgeois sell off to foreign nationals.
But it is not only far off nations or the most barren landscapes of America that succumb
to the pressures of the oil industry. In the Canadian province of Alberta, the wealthiest of the
Canadian provinces, the Social credit party was in power for over 80 years. This might have
something to do with oil making up approximately 30% of Albertas revenue(Nikiforuk 2012).
Again, looking at the rentier effect of petro-states, Alberta is using its cash flow to have the
lowest income tax rate in Canada-10% flat tax- and no sales tax whatsoever. This is where the
bourgeois oil industry is keeping the proletariat down, binding them so to speak by keeping taxes
low, even though the flat income tax puts considerably more tax pressure on the low income
families of the region. These families are largely the indigenous peoples of Canada, who itself
has very few tribal reservations. But, looking further into Albertas rentier state aspects, the
spending effect can be seen in play here. Simply typing in Calgary public projects in any
search engine brings back quite literally millions of hits, ranging from public art forums, to new
libraries, to something called the Giant Blue Ring, something one might assume to have some
deeper meaning about life in Alberta, when in reality its just a giant blue ring. This wanton

spending is clearly an attempt to distract the general public from the wavering strength of the oil
industry in Alberta, but that will be discussed later.
This idea of oil negating the democratic process, and in fact actively repressing it, was
first theorized by Terry Lynn Karl, who when looking at how Venezuela had gone through such
astronomical change upon the discovery of oil in the region, as well as the rise of Hugo Chavez,
who created a faux socialist, personalist regime, where he lead the country until his death. Karl
discusses a sort of Dutch Disease, where the discovery of a new, more favorably commodity
puts stress on other industries, such as agrarian economies or national industries that rely heavily
on manufacturing based industry(Karl 1997, p. 5). The Dutch Disease perfectly encaptures how
the discovery of oil disrupts democratic processes, as can be seen by examining Venezuela.
Looking at Venezuelas tax rate, a whopping 14.1% of its total tax rate comes from corporate tax
(Karl 1997, P89). That means that corporations, in theory, own a majority share of the
government: however, interestingly Venezuela, specifically the government of Venezuela, own
all oil production facility and treatment plants. This means that the Venezuela people should be
in control of the most valuable non-renewable commodity in the world, but alas, they are not. In
fact, as of the second half of 2005, approximately 37.5% of all households live below the poverty
line (Weisbrot 2005, p.1). How is it that with such an incredible resource in their hands, the
proletariat still struggle? They were blinded by the supposed peoples champion in Hugo
Chavez. Its worth noting that Chavez did quite a lot for social programs such as subsidized food
programs and programs to erase illiteracy, but even then many of Venezuelas poor were living in
squalor. Chavez used the windfall of national oil commodities to help consolidate his power, but
did little to effectively fight poverty in the nation even with its newfound wealth Chavez was
using a patronage effect of his new found power to make the people completely ignorant to his

misdoings globally and nationally. Globally, Chavez said he was actively combatting
Washington, D.C., when in reality he was selling them sixty million dollars worth of oil a day in
2005(Weisbrot 2005). Nationally, Venezuela was actively destroying the homes of tribal people
in the amazon region of the country for the use oil under their feet. Chavez was just as dirty as
the oil he was selling to his so called capitalist enemies. The recent oil price drop has lead
Venezuela to take such drastic measures as seizing a Nestle, PepsiCo, and Empresas Polar
distribution centers to help solve chronic issues of providing basic needs.
But return for a moment, if one would, to Alberta. As previously discussed, big oil had
allowed the government to grow massive and strong, with the people not engage in politics. This
has created a superstorm of non-democratic practices, but in the past few months the oil industry
has seen a drop in production. This has had a serious effect on Alberta, which is referred to as the
Texas of the North. Such a serious effect in fact that of the 18,006 layoffs to happen this year
in Alberta, 78% has been from the oil and gas industry(Toneguzzi 2015). These mass layoffs are,
as one Canadian health minister stated, one of the reason Alberta has seen a 30% increase in the
rate of suicide in the province(Krishnan 2015). David Kirby, a councilor at a Calgary based
mental health association said that "for [him] it says something really about the horrible human
impact of what's happening in the economy with the recession and the real felt effect, the real
suffering and the real struggle that people are experiencing,"(Krishnan 2015,p. 1). Not only has
the recent oil crumbling lead to an increase in such a tragic way, it has lead to a political shift.
The Conservative party of Alberta had been in power since 1971, lost their power to the New
Democratic Party in recent elections. The issue with this shift is that they happen after an
incredibly prolonged period of power by one party, often times changing around or on point to a
crisis in the oil economy of Alberta. For before the Conservatives forty years of rule, they took

over from the Social Credit party, who had held the senate from 1935-1971( a span of almost
forty years). Coincidentally, the Social Credit Party lost power just as the 1970's energy crisis
was beginning. Does this mean that the NDP are now set to engage in another long period of
non-democratic, single party rule? Nikiforuk discussed these all too coincidental shifts in power,
looking at how Albertas solution to economic crises is rarely something other than building a
new oil pipeline or allowing more oil companies to ravage their countryside(Nikiforuk 2012).
It is important now to analyze where oil and democracy have come to in a modern
setting. Looking at the recent shift in the global oil market, the price of a barrel of crude oil has
dropped to a seven year low at forty dollars a barrel(USD). This record low sale has lead to a
variety of geopolitical issues. Looking at the Ukraine, whose government is still undergoing
rebuilding from the incredibly corrupt regime of Yanukovych and the military endeavours that
have shaken the country financially, politically, and culturally, the flailing oil industry has lead
Chevron to cancel a ten billion dollar (USD) exploration deal that could have potentially
removed the Ukraine's dependency on Russian oil commodities(Naim 2015). The issues that
arise in the failing oil economy will become more apparent as time goes on, but as Sino-Russo
relations grow stronger because of this their power to support non-democratic regimes such as
the Democratic Peoples Republic of Korea, who is wholly dependent on oil provided by both
these nations to keep their tiny manufacturing section in motion, as well as wholly subjugate an
entire country. On top of this, with places like Alaska and Alberta, areas where non-democratic
practices occur in democratic regions, it will be the workers, the proletariat who struggle the
worst.
As aforementioned, the amount of unemployment in the oil sector of Alberta has fallen
massively, which then lead to a shift in power for the region for the first time in over forty years.

But this has also lead to a ninety-nine percent increase in the amount of unemployment benefits
sought after in the region(Krishnan 2015). And in Alaska, the government has begun slashing
public resources. This is the issue with having a petrol based economy it moves in regular boombust cycles that are blindingly strong in the boom, incredibly volatile in the bust cycle. As can be
seen from 2015 fourth quarter reports, the oil market is currently trading at its lowest point in
years. The issue currently is not the lack of oil production, or a bearish market, it is in fact a glut
of oil that is sending the price of oil down to an average of $35 a barrel, but as low as $20 in
some cases(Rascouet 2015). With this over production it will require a massive sell off that will
crush emerging oil markets and inevitably cost jobs in petra state regions, this will likely cause a
shift in democratic necessity, as has been displayed by Alberta in the past few years as it has
struggled with its dwindling oil production.
This failing system has lead to the US even lifting archaic bans on exporting its oil, with
the US exporting more oil than some OPEC countries this year, thus consolidating and
perpetuating the strength of single-partyism in oil producing states (Murtaugh 2015). And yet,
with all this the world is beginning to focus on the enemy of oil. This it is not implying
democracy, but rather global warming. In the last weeks of 2015, many global leaders came
together in Paris at COP21 to discuss how to deal with the impending dangers of global
warming, which oil and other natural gasses have played a massive role in helping to facilitate.
COP21 saw a pledge of hundreds of countries, with a total approximated $13.1 trillion
investment focused entirely on low impact and renewable energy sources, a deal that would
effectively cripple the oil industry. What does this mean for the workers and the countries they
reside in? This can only be looked at in a purely speculative manner, but given the results of
recent elections in Alberta, one can presume that their will shift in attitudes to either more

conservative values that will actively fight global initiatives to combat climate change or more
liberal values, opting to do away with oil industriality for a cleaner approach to energy supply
based economies; however it is difficult to qualify this assertion considering we have no
conclusive evidence on clean energy in Alberta and the potential to transition to this type of
energy export.
While it would be pleasant to assume that every petra state will transition away from
being almost exclusively dependent on oil export as the basis of their economies, it is simply not
likely. In fact, in regions such as the Middle East and South America, it is likely that there will be
many bloody revolutions revolving around this increased global pressure to reduce the
exportation of oil. Considering evidence from the Arab Spring, economic strife leads to bottom
up revolutionary movements. Looking at Syria, the rampant unemployment that was linked to
the 2009-2011 global recession that saw a decrease in global oil futures, a bloody revolution
erupted in an otherwise peaceful period of transition. This again is linked to the rentier effect,
where the ruling class, in this case the Assad regime, benefitted greatly from the use of its land to
remain in power, while keeping the lower class down by reducing tax burdens. This pent up
aggression was then repressed through incredibly barbaric means. When the democratic fever hit
Syria, there was an incredible demonstration in the streets of Damascus, which saw heavily
armed troops firing live rounds into peaceful crowds. It did not end there, but continued on with
imprisonment and intensive investigating of those involved, which resulted in baseless
convictions of protestors involved.It is increasingly likely given global pressures and tensions,
not only in relations to reducing oil use but in the increasingly militant and antagonistic natures
of countries like Turkey and Russia, coupled with a global military effort to combat a faux

Islamic state perpetuating Islamophobia and fascist attitudes globally, armed conflict is likely to
arise.
So how can international powers defuse this potential disaster? It revolves around the
proletariat, the working class in petra-states and the use of clean energy and low impact energy
resources. By combining the necessity the reduction of carbon emissions with the dismantling of
petra-states, the global community can combat the issue of armed conflict with the collapse of oil
exporting economies by replacing them with green and low impact sources of energy collection.
Imagine fields of solar panels in Saudi Arabia being maintained by former oil derrick workers
from the country they reside in. Imagine wind farms stretching for miles across the waters off the
coast of Venezuela being looked after a locally run collective of former crude oil refinery
workers. The necessity to diffuse the pre-existing barriers to democracy that oil creates while
simultaneously reducing the impact of carbon emissions, as well as reducing the likelihood of
violent conflict arising during the transitive periods to democracy that will hopefully come when
the petra-state economies are effectively dismantled as the necessity to combat the effects of
global warming grows exponentially everyday.
It is becoming more and more apparent that the oil market will eventually collapse. Both
due to economic forces and increased legislation to protect the environment. In the coming years,
it is likely that with the collapse of oil in places like Alaska,Alberta, and Texas, there will be a
shift away from single party rule towards more natural democratic processes that will task
politicians with finding ways to bring clean energy to their respective constituencies while also
combating the inevitable impact that the collapse of the oil industry will having on working class
houses that man, operate, and maintain the resource and the plants that extract and refine it that
are the literal backbone of the economies in those regions. It is also increasingly likely that with

the collapse of the oil economy, regions and states such as the Middle East, Saudi Arabia, South
America, and Venezuela will see transitions to democracy. They too will have to find ways to
combine the growing renewable energy market and the failing petra-state to combat the massive
economic strain that will come with the deconstruction of the global oil market.
The future is bright if the global forces that were involved in COP21 work together to
support regions that are heavily dependent on oil exports. But as a global community, those
involved should foster an attitude that is vastly anti-capitalist, so as to avoid the mistakes that
came with such mega corporations such as Exxon or British Petroleum. If measures such as
keeping renewable energy products and its respective market at state level, placing the people
truly in charge of how the energy is refined and then traded are not taken, it is likely that there
will be a rise in a new era of eco-states, where massive corporations will seek to monopolize and
destabilize regions by displacing residents not for the only under their feet, but the sun above
their heads and the wind that pushes them far away from their homes.

Works Cited
Ross, Michael 2009, Oil and Democracy Revisited, UCLA Publications
Ross, Michael 2001, Does Oil Hinder Democracy?, The Muse Project, Syracuse
University Publications
Ross, Michael 2010, Oil and Democracy: Does Oil Hinder Democracy?, The
Petroleum Curse: How Oil Shapes the Development of a Nation, The Montreal Review
Looney, Robert 2014, Can Ghanas Democracy Save It From the Oil Curse?,
Foreign Policys Democracy Lab
Alaska Department of Revenue Tax Division 2015, tax.alaska.gov
Alaskan Voters Commission 2006, Alaska Voter Statistics, Alaska Voter Statistics
from 1958-2006
Rosenberg, Tina 2007, Oil Meets Socialism in Venezuela, The New York Times
Ngemi, Yaa-Lengi 2015, Repression in the Democratic Republic of the Congo:
Joseph Kabila Attacks and Brutalizes Citizens, The Huffington Post: The World Post
KPMG 2013, Oil and Gas in Africa: Africas Reserves, Potential, and Prospects
Karl, Terry Lynn 1997, The Paradox of Plenty: Oil Booms and Petro-States,
University of California Press
Weisbrot, M, Sandoval, L & Rosnick, D 2006, Poverty Rates in
Venezuela:Getting the Numbers Right, CEPR
Toneguzzi, Mario 2015, Mas Layoff in Alberta Surge Past 18,000 Workers as
Oils Collapse Takes Toll, The Financial Post
Krishnan, Manisha 2015, Albertas Suicide Rates are up 30 Percent Amid Oil
Crisis, Vice News Media
Friedman, Nicole 2015, Brent Crude Falls; Oil Prices End at Nearly Seven Year
Lows, Wall Street Journal
Naim, Moises 2015, The Hidden Effects of Cheap Oil Prices, The Atlantic
Rascouet, Angelina 2015, Never Mind $35, The Worlds Cheapest Oil Is Already
Close to $20, Bloomberg Business
Hunziker, Robert 2015, COP21 Stares Down Big Oil, Counter Punch News