A widely accepted phenomenon in political science involves the increased level of a state’s “democraticness,” that occurs as a result of income that state may generate. Simply put, more money coming into a state has a positive democratic effect on the state’s political and social makeup. But scholars have found in the case of the Middle East and Northern Africa, rising income levels are not always associated with an increase of democracy. These countries, although extremely wealthy due to their unparalleled oil resources, suffer from what political scientists call the “resource curse.” So we can say that when the rising levels of a state’s income occur from oil and particularly “oil rents,” which I’ll elaborate on shortly, that state’s democraticness is damaged as a result.
Oil renting is a process that occurs when a state possesses control of valuable resource (oil), which in turn may be used by external actors (other countries or businesses) to generate revenue for the resource rich country. States that receive substantial rents from foreign individuals are what political scientists call, “rentier states.” Minerals generate rents in the form of export taxes, and extracting minerals such as oil requires little labor. It is very well known that in terms of oil on a global scale, the MENA region possesses an unparalleled abundance of some of the cheapest to produce and purest oil in the world. The issue with such an abundance of resource wealth, particularly in the case of oil, is that it pits the interests of the labor force against those of the elites in the private sector.
Michael Ross, a political scientist and MENA expert, argues that the consequences of oil rents are democratically negative on the political makeup of MENA countries. Furthermore, Ross asserts that oil wealth makes the state less democratic and oil-wealthy governments do a poorer job or promoting economic development. Ross emphasizes that oil wealth may lead to greater spending on patronage, which by nature is inherently undemocratic, in what he calls a “spending effect.” But another important point to note is that although rising income revenues have a positive democratic effect on non-Middle Eastern countries, a majority of MENA countries have been highly authoritarian since their gaining independence. Ross argues that states that fund themselves internally through taxes, services, etc., are naturally more democratic because an autonomous state is not accountable to any external societal interest.
Low production costs equal high rent levels for resource rich countries. The countries are able to use the rent they get to then essentially buy off their populations. This often appears in the form of tax breaks, import labor, or cash transfer programs. But this has a deteriorating effect on the relationship between a state’s citizenry and its government as the public has very little oversight on resource allocation or on government spending. This is the reason for the anomaly of Middle Eastern renterism, in that a state that exports its resources and imports its labor with little regard for the will of its society does not bode well for the political efficacy of that state’s society. The process of renterism encapsulates the capitalist principle of concentration of wealth, which oil-rich states use to yield concentration of power and essentially de-democratize their societies. The size of the oil rents is irrelevant. The anti-democratic effect is due to the state’s disregard for any form of domestic labor or to promote an internal economy. An angry, unemployed, and politically frustrated citizenry is the result of a government that does not seek to better its domestic economy. Any government, such as those in MENA, that works to raise its GDP but not its domestic economy; results in a society that is angry, unemployed, and politically frustrated – in what will ultimately be a less-democratic state.