Hydropolitics in the Third World: Conflict and Cooperation in International River Basins; Why Governments Waste Natural Resources: Policy Failures in Developing Countries
In coming decades, fresh water is likely to become the scarcest resource in several parts of the world. From different perspectives, these two books examine resource management in developing countries. Elhance looks at six politically important river basins -- Parana, Nile, Jordan, Euphrates, Ganges, and Mekong -- all of which require international cooperation to exploit fully their benefits for irrigation, flood control, navigation, and electric power. He also examines the political and technical obstacles to cooperation among the great-river nations, offering hopeful judgments about the possibility for joint action in the future. But the book could have benefited from some discussion of rivers where effective international cooperation has been achieved, such as the Rhine, Danube, and St. Lawrence.
Ascher asks a different question: Why have developing countries so often badly managed natural resources? He draws on numerous case studies, including not only water management (Mexico) but also oil (five countries), copper (Chile and India), and forests and timber (seven countries). Although Asher acknowledges that ignorance about resource management has played some role, he argues persuasively that policymakers too often have sought objectives that they knew their finance ministries, their publics, and even the international community would oppose if pursued directly through the national budget. Thus governments often wasted resources deliberately to divert resource rents to other purposes, such as aircraft production in Indonesia, usually through related public companies. Ascher concludes that if such countries want to improve resource management, they must confront directly these other objectives by either subordinating them to efficient resource management or achieving them in some other way.
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A Pretext to Panic
Michael S. Teitelbaum and Jay Winter
"The Global Baby Bust," by Phillip Longman (May/June 2004), offers a new version of an old fear: the threat of population decline, which has emerged periodically throughout the past century as a major focus of political discourse. Such worries seem to crop up at predictable moments: when a dominant political or economic power begins to feel unsure of its mastery and uncertain about the future, many thinkers turn to demography for an explanation of its plight.
The next great oil boom is on: four former Soviet republics on the Caspian Sea are sitting atop an economic bonanza. But they should remember the fate of OPEC, whose members squandered their 1970s windfall. Where did all the money go? The state took on too dominant an economic role and wasted the wealth at home in a rash of boondoggle projects and military buildups. All OPEC members came down with "quick-money fever." They became addicted to supposedly limitless oil revenues even as boom turned to bust. The Caspian states, too, risk going from riches to rags if they do not resist the temptations of petromania.
Chinese foreign policy is now driven by China's unprecendented need for resources. In exchange for access to oil and other raw materials to fuel its booming economy, Beijing has boosted its bilateral relations with resource-rich states, sometimes striking deals with rogue governments or treading on U.S. turf. Beijing's hunger may worry some in Washington, but it also creates new grounds for cooperation.

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