[OPE-L:6005] rentier state

From: Rakesh Bhandari (rakeshb@stanford.edu)
Date: Mon Sep 24 2001 - 04:03:32 EDT

as chai on and jerry begin a discussion of the character of the western state, 
i thought i would raise the problem of what has been called the rentier state. 
This kind of state seems incapable of legitimating itself to its subjects. Fred 
Halliday points to its fundamental features:

"the uniqueness of oil resides...in the peculiar form of payment resulting from 
it, a rent to producer states that does not entail the forward and backward 
linkages within the local economy that are characteristic of other primary 
production in the third world. The collection of this 'rent' enables the 
producer state, and those controlling it, to amass enormous sums of money 
without engaging in any form of production; it is this which has generated such 
major social tensions within the producer states. These tensions--growing 
income inequality, rampant corruption in the state, grandiose development 
projects, neglect of productive activity and skills, esp. in agriculture--have 
been seen as much in Lagos and Jakarta as in Tehran and Riyadh. Islam, the 
Palestine question, Arab unity and oil do not therefore define a sui generis 
Middle East."

halliday also writes: 

"The middle east is characterized by what is peculiar to oil, the anomalous 
economic and osical consequences of its production. Less than half of the 
Middle Eastern states are oil producers, and the majority of those have small 
populations. The majority of the states with large populations do not have oil 
This asymmetry of population and oil resources has provoked substantial 
migration from oil-less t oil-producing states, while at the same time enabling 
the oil producers to use their wealth for individual political purposes in the 
region. That ability to focus their power has been compounded however by the 
the peculiar economies of oil roduction itself, which has a minimal linkage 
with the society in which it is taking place. In this context the main, indeed 
sole, significant effect of oil is that he producer state obstains a 
substantial rent from overseas sales. Inputs of labour, capital or agricultural 
goods are very small; hence oil production has an enclave character. Taken 
togehter, these two features of oil production--its asymmetrical distributin, 
its provision of rent rather than generation of national incomes--means that 
some of the states most marked by pre colonial continuities have been the very 
ones endowned with substantial quantities of surplus capital. This they have 
deployed to promote not only their particular political values but also their 
social values as well: forms of conservative "islam", whether in its Saudi or 
Qaddafi-ite form."

Islam and the Myth of Confrontation, 1995. p. 40. 

I have mentioned here before what i consider to be a very important study of 
the manipulation of this surplus capital, aka petro dollars. David Spiro, The 
Hidden Hand of American Hegemony Petrodollar Recycling and International 
Markets. Cornell University press, 2000. 

there is also an old volume in a box somewhere which I am trying to find. Oil 
and Class Struggle, ed. Peter Nore (?). There is an article by Iranian scholar 
in that volume on the problem of rent. 

does anyone know cyrus bina; would it be possible for him to be asked to join 
this list?


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