Hard Times in the Lands of Plenty: Oil Politics in Iran and Indonesia

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Hard Times in the Lands of Plenty: Oil Politics in Iran and Indonesia

By Benjamin Smith
Cornell University Press, 2007
256 pp. $59.95
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Once upon a time, being blessed with a generous endowment of oil or other natural resources was considered a national boon, perhaps even necessary for economic development. More recently, oil wealth has come to be seen as a curse, directing entrepreneurial energies toward extracting rents from the government rather than into socially productive investment. If this more recent view is universally correct, why are some oil-based regimes so durable? The political scientist Smith addresses this puzzle by analyzing developments in two contrasting oil-rich states, Iran and Indonesia, during the 1960s and 1970s. The shah of Iran fell ignominiously in 1979, whereas Indonesia's president, Suharto, lasted nearly two decades more. This analysis, which Smith extends in less detail to other oil-rich countries, leads him to conclude that the timing of oil wealth is all-important. Where leaders (Suharto, for example) have built broad-based supporting coalitions, they have been more likely to survive boom-and-bust crises than where leaders have relied on oil-based patronage from the beginning, usually because it was the easiest course available. Smith finds many oil-based regimes more durable than is often assumed. Regrettably, this interesting book abounds in methodological discussion of greater interest to specialists than to the general reader. And although its historical analysis is rich, it contains little on contemporary Iran.