ROBERT SIEGEL, host: In Libya, one of the biggest problems a post-Gadhafi government will face is, surprisingly, oil wealth. Having lots of oil, it turns out, is usually a curse - one that only a few oil-rich nations have managed to avoid. Among the success stories one stands out: Norway.
Today, Planet Money's Alex Blumberg brings us the story of the unlikely man at the center of Norway's strategy, and the lessons he has for Libya.
ALEX BLUMBERG: So first off, just how bad is it, having lots of oil?
Dr. MARTIN SANDBU: It's awful. Most countries would probably have been better off without oil than they are with oil.
BLUMBERG: Martin Sandbu is a journalist for the Financial Times. But in a previous life he was an academic who studied the problems that oil causes.
First of all, whenever something valuable is discovered, fights break out over it. So a lot of oil countries end up being ruled by dictators and autocrats. And then, the massive amount of money flooding into a country after oil discovery often has the perverse effect of putting existing industries out of business.
So how did Norway avoid this fate? A lot of it was due to this guy.
Dr. FAROUK AL-KASIM: My name is Farouk al-Kasim.
BLUMBERG: Kasim not a Norwegian name, right?
(SOUNDBITE OF LAUGHTER)
AL-KASIM: No, it isn't.
BLUMBERG: Al-Kasim is Iraqi. And for over a decade, he worked in Iraq for an oil company. He was trained as a geologist. But in the 1960s, al-Kasim and his wife, who is Norwegian, decided to move to Norway. Their son had cerebral palsy and needed medical care. Job-wise Norway seemed, at the time, like the worst place in the world for an oil guy like al-Kasim.
AL-KASIM: You see, the Norwegian Geological Survey had already said that there is no hope in heaven of ever finding oil or gas.
BLUMBERG: Al-Kasim figured, worst case scenario, he'd drive a taxi. But it turns out al-Kasim's skills were needed in Norway. Even though Norway's geologists had said there wasn't oil, companies were still out there looking for it. And so, the Norwegian government hired al-Kasim to review the reports these companies were sending in about their explorations. And what he saw in the data was surprising.
AL-KASIM: Remember, the country was saying there is no way there's oil out there. And here I am looking at data that says, my God, they have already found it four times over. Admittedly, not yet commercial size.
BLUMBERG: Not yet anyway. But around a year later, the Ekofisk oil field was discovered, a massive find. Norway was officially rich. Now, how to keep the riches from destroying them. Al-Kasim and a colleague wrote a series of proposals that found their way into a government plan that most people credit with saving Norway from the oil curse.
For example, to keep all that oil money from destroying existing industries? The plan had a pretty radical solution: limit the amount of oil money there is. Don't drill everything at once. As you might imagine, this plan didn't go over so well with everyone.
AL-KASIM: It was received with skepticism by the industry, who wanted Norway to go full-speed ahead.
BLUMBERG: But Norway said no, and handed out just a couple drilling permits a year. And, in an additional act of self-restraint, the Norwegians decided the money we get from the oil, we're not going to spend it. We're not going to let it wash into our economy where it could disrupt existing industries.
Again, journalist Martin Sandbu, who himself is Norwegian.
SANDBU: It's been saved in an oil fund, a savings fund, and the government only gets the interest on the financial wealth that's in that fund. The trust fund is, I haven't checked the latest numbers, but it's on the order of $500 billion now, which amounts to $100,000 dollars per Norwegian citizen.
BLUMBERG: Does anybody in Norway say - you know what, I just want that money now? Can you just give me $100,000?
SANDBU: Surprisingly few.
AL-KASIM: Well, that's what I call the Norwegian Miracle.
BLUMBERG: Again, Farouk al Kasim.
AL-KASIM: The Norwegian Miracle is that all the parties in parliament agreed on a policy. And they agreed among themselves that they will never use oil policy as a subject during elections.
BLUMBERG: So, that's Norway's secret. At every step of the way, do the opposite of basic human nature. Tell powerful oil companies, you can't get the oil right away. Tell taxpayers, you won't get the money from the oil right away. And tell campaigning politicians, you know that half trillion dollars just sitting there in our oil fund? You're not allowed to talk about it.
Al-Kasim says he worries that Libya, like most countries, will find it difficult to emulate Norway's success. His main piece of advice for them - for God's sake, go slow.
For NPR news, I'm Alex Blumberg.
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