The Foreign Service Journal, December 2003

And because the dividend would constitute a regular source of income, it would also provide collateral for ordi- nary citizens to finance small business investment pro- jects. This, in turn, would stimulate development of cred- it markets, which are so essential for development. Another problem that frequently afflicts oil-rich coun- tries is they suffer from economic activity that is skewed toward excessive government, a feature which also pro- motes corruption. Directly paying revenues to citizens would help rectify this structural imbalance. Finally, on the political side, citizens would have an incentive to become politically engaged to protect the dividend paid by the ORDF, and to ensure that state-owned oil indus- tries operated efficiently so as to maximize the dividend. One common objection to distributing oil revenues is that it would starve developing country governments of money needed for infrastructure building. However, this concern is misplaced. The goal of development is to build strong political and economic institutions, and trade-offs are always present, given the scarcity of resources. Directly distributing a chunk of oil and mineral revenues to citizens may be the best possible development invest- ment, yielding higher returns than infrastructure spend- ing in terms of creating political ownership and economic dynamism. An ORDF would seem to be particularly appropriate for Iraq. In a New York Times op-ed (April 9, 2003), Steve Clemons of the New America Foundation proposed that Iraq establish an Alaska-style oil fund that would pay annual dividends to the citizens of Iraq. But given Iraq’s current condition of economic collapse and history of autocratic kleptocratic governance, it makes better sense to pay a significant portion of oil revenues to Iraq’s citizens now. In addition, a companion fund should be established that would distribute a share of oil revenues to provincial and local governments. This second fund can ensure a fair regional distribution of revenues, thereby reducing the potential for regional grievances that can lead to civil war. Paul Bremer, the top U.S. administrator in Iraq, has expressed support for such a fund ( New York Times , July 13, 2003). But while it is appropriate for Bremer to con- F O C U S D E C E M B E R 2 0 0 3 / F O R E I G N S E R V I C E J O U R N A L 59 As professionals in the foreign affairs agencies, we all work to protect our nation's interests around the globe, serving in difficult, even dangerous places. Yet the families of our gay and lesbian colleagues are not provided with health care, evacuation insurance, or access to life-saving training. This holiday season, our one wish is for equality. If you agree, contact us at :glifaa@hotmail.com, or visit our Web site: www.glifaa.org. Bob Post, President Ken Kero, VP for Family & Policy Issues David Tessler, VP for Outreach Angela Martin, Secretary-Treasurer Tom Coleman, Director of Communications Gays and Lesbians in Foreign Affairs Agencies