The poor country with all the money - CuencaHighLife

The poor country with all the money

Aug 10, 2026 | 0 comments

Views: 351

I recently noticed a below the line comment describing the United States as a poor country.

To me this seemed plainly wrong. The United States is not a poor country, but it is an extraordinarily rich country in which wealth is distributed so unevenly that millions of people, and quite a few public institutions, experience something resembling poverty.

A country that can produce a single company worth more than the entire annual economy of Britain cannot sensibly be called poor. Neither can one that maintains military bases around the world, sends machines to Mars and pays a university football coach more than the president. Yet this same country contains schools where teachers have to buy classroom supplies from their own salaries, families can be bankrupted by illness, many cities are unable to provide safe and reliable public transportation, and an alarmingly high proportion of workers live only a single paycheck from the virtual debtor’s prison of default and bankruptcy.

The money is there alright, but the more interesting question is who owns it.

That question leads me, by one of those conversational side roads that are more interesting than the original destination, to the example of oil.

In the United States, oil beneath privately owned land may belong to the landowner, although mineral rights can be separated from ownership of the surface. A farmer like Jed Clampett of the Beverly Hillbillies may own the field, while somebody else owns whatever lies beneath it–or maybe not! This is a peculiarly American arrangement. In most countries, including Ecuador, underground oil belongs to the state.

But what about oil beneath the sea, where there is no rancher standing above it and no fence post on which to hang a No Trespassing sign?

Close to the American coast, the seabed generally belongs to the individual state. Farther out, it belongs to the federal government, which means, at least in theory, that the oil belongs collectively to the American people.

The federal government does not normally drill for it. It leases blocks of the seabed to private companies. The companies bid for the right to explore, pay rent and royalties, assume the financial risk, and keep the remaining profits if they strike oil. In the 2024 fiscal year, federal offshore oil and gas produced about $7 billion in direct government revenue.

Seven billion dollars is hardly loose change, even in Washington. But spread among 340 million Americans and buried inside a federal budget measured in trillions, it does not feel much like a national inheritance. Nobody receives a note saying, “Here is your share of the oil we sold this year" unless they were born in Alaska.

Ecuador approaches the matter differently. Its petroleum legally belongs to the state, and the state-owned Petroecuador is the country’s principal producer. Oil earnings flow much more directly into government finances and have at times accounted for a very large share of public revenue and exports.

This does not mean that every Ecuadorian finds a small envelope of oil money under the door. That money disappears into fuel subsidies like cheap cooking gas, government salaries, debt payments, inefficient operations and the mysterious plumbing of public finance. Petroecuador has not always been offered as an international model of transparent and immaculate management.

Nevertheless, the principle is clear. Petroleum is treated as a national resource, not merely as something from which the government collects a fee while private owners retain the principal gain.

Then there is Norway. Norway and Britain discovered enormous petroleum resources in different parts of the same North Sea at roughly the same time. Both countries became oil producers during roughly the same period. What they did with the proceeds could hardly have been more different.

Norway decided that oil was not ordinary income. It was a finite national asset. Selling a barrel made the country richer in cash but poorer by one barrel of oil reserves. If the cash were immediately spent, the asset would eventually vanish and leave little behind. Norway therefore placed much of its petroleum income into what became the Government Pension Fund Global and invested it abroad.

By the end of 2025, the fund was worth more than 21 trillion Norwegian kroner. Remarkably, investment returns now account for considerably more of its value than the net amount deposited from petroleum revenue.

Much of that money is invested in the United States. Norway owns shares in Apple, Microsoft, Amazon, Nvidia and thousands of other companies. It owns American government and corporate bonds, property and infrastructure. Oil beneath the North Sea has been transformed into permanent Norwegian claims on profits generated around the world.

There is a pleasing circularity to this. Americans buy Norwegian...