National oil companies (NOCs) produce most of the world’s oil and natural gas and bankroll governments across the globe. Although NOCs superficially resemble private-sector companies, they often behave in very different ways. To understand these pivotal state-owned enterprises and the long shadow they cast on world energy markets, the Program on Energy and Sustainable Development (PESD) at Stanford University commissioned Oil and Governance: State-owned Enterprises and the World Energy Supply. The 1000-page volume, edited by David Victor, David Hults, and Mark Thurber, explains the variation in the performance and strategy of NOCs, and provides fresh insights into the future of the oil industry as well as the politics of the oil-rich countries where NOCs dominate. It comprises fifteen case studies, each following a common research design, of NOCs based in the Middle East, Africa, Asia, Latin America, and Europe. The book also includes cross-cutting pieces on the industrial structure of the oil industry and the politics and administration of NOCs.

NOCs are distinguished from private companies by their need to respond to state goals beyond profit maximization. Governments seeking to retain their hold on power use NOCs to deliver benefits to influential elites (“private goods”) or to the broader population (“social goods”). Oil and Governance finds a strong correlation between such non-hydrocarbon burdens on the NOC—which include providing employment, subsidizing fuel, or handing out plum jobs to the politically connected—and deficiencies in oil and gas performance. The highest-performing NOCs, like Norway’s Statoil and Brazil’s Petrobras, face relatively circumscribed non-oil demands from their governments.

How governments administer their oil sectors also proves to be a crucial determinant of NOC performance. Democracies (e.g., Norway, Brazil) and autocracies (e.g., Saudi Arabia, Angola) alike are capable of grooming successful NOCs. What matters most for outcomes is not regime type per se but rather that governance systems provide unified signals to the NOC. (By contrast, regime type is observed to be an important driver of whether governments nationalize their oil sectors in the first place, or privatize existing NOCs.) Fragmented governance, in which multiple government actors assert their interests but no one assumes strategic responsibility, appears uniformly fatal to NOC performance. Nascent democracies like Mexico’s can be particularly vulnerable to oil sector dysfunction stemming from fragmentation. Governance systems must also be matched to a country’s institutional and political realities. Nigeria has arguably set back its progress in oil through attempts to slavishly imitate Norway’s forms of oil organization in the absence of Norway’s mature political and civil service institutions.

The close ties between the NOC and its government can have a detrimental effect on the ability of the NOC to manage the risks that are so characteristic of the oil and gas industry. Whereas private companies are forced to hone their geological knowledge and skills through global competition for capital and hydrocarbon licenses, NOCs for the most part are comfortably sheltered from competitive threats at home. They therefore fail to develop the global reach that helps private players (the international oil companies, or IOCs) manage risk by means of a diversified global portfolio and the ability to link resources to customers around the world. (Some NOCs have begun to internationalize in recent years, but it is striking that none of the NOCs studied in Oil and Governance went down this path until forced to by domestic resource scarcity, or at least of the perception of future scarcity.) The soft budget constraint faced by the NOC also discourages the cost efficiencies that help mitigate risk.

This gulf in risk management capabilities between IOCs and most NOCs suggests that the resource dominance of NOCs does not pose an existential threat to private oil companies. Private players will continue to play a key role in the frontiers of oil and gas development—frontiers like shale gas, oil sands, and the remote Arctic. NOCs will continue to control low-cost oil around the world, while a select few of the most focused and unencumbered among them start to build up their own risk management skills through partnerships with IOCs.

NOC control over resources has important implications for the world oil price. The NOCs studied in the book produce their reserves at half the rate of the major IOCs—whether due to lower performance or a deliberate attempt to preserve resources for the future. Moreover, governments tend to rely most heavily on the risk management skills of IOCs when prices are low and then swing back towards NOCs in high price periods when they can afford to focus on delivering benefits to favored constituencies. The result of this dynamic, which is observed in the case studies of Oil and Governance, can be “backward bending supply curves” that exaggerate price volatility in the world oil market.

This effect of NOCs on global oil supply and price appears to be much more important than any geopolitical fallout from NOC primacy around the world. Oil and Governance finds very little evidence that NOCs act as effective foreign policy weapons on behalf of their host states. Even where politicians may desire to employ NOCs in this way, the incentives of the NOC itself are usually strongly opposed to such an exercise of power. As one example, Europe’s Gazprom depends overwhelmingly on revenues from gas exports to Europe because gas is so heavily subsidized in Russia. When NOCs do venture abroad, as in the case of China’s CNPC, they are often motivated to do so precisely by the desire to achieve more autonomy from their political masters at home.

Reducing carbon-dioxide emissions is primarily a political problem, rather than a technological one. This fact was well illustrated by the fate of the 2009 climate bill that barely passed the U.S. House of Representatives and never came up for a vote in the Senate. The House bill was already quite weak, containing many exceptions for agriculture and other industries, subsidies for nuclear power and increasingly long deadlines for action. In the Senate, both Republicans and Democrats from coal-dependent states sealed its fate. Getting past these senators is the key to achieving a major reduction in our emissions.

Technological challenges to reducing emissions exist, too. Most pressing is the need to develop the know-how to capture carbon dioxide on a large scale and store it underground. Such technology could reduce by 90 percent the emissions from coal- fired power stations. Some 500 of these facilities in the U.S. produce 36 percent of our CO2 emissions.

But these plants aren’t evenly spaced around the country. And therein may lie the key to addressing the political and technological challenges at the same time. If the federal government would invest in carbon capture and storage, it could go a long way toward persuading politicians in every state to sign on to emission reductions.

I’ll get to the specifics of the technology shortly. But first, consider how the costs of emission reduction fall hardest on certain parts of the country: A carbon tax levied on all major sources of released CO2, the approach favored by most of the environmental community, would make energy from coal-fired power plants cost more. To make a significant difference, such a tax would have to amount to $60 a ton.

Midwest Carbon Footprint

As a result, gasoline prices would rise 26 percent, and natural gas for household usage by 25 percent, nationwide. Rich and urbanized states could probably tolerate this. The West Coast, with its hydroelectric power, and the Northeast, which relies to a large extent on natural gas, could most easily absorb the associated increase in energy costs.

But the price of energy in the rural, Midwestern states would more than quadruple because of their large carbon footprint. Midwesterners get most of their electricity from coal; they drive relatively long distances to get to work, shopping and entertainment; and rural homes and buildings use more energy for heating and cooling.

One carbon-tax proposal now being considered is a “cap and dividend” plan that would send the tax revenue back to all U.S. citizens equally. But that would also favor the rich states that are less dependent on driving and coal.

It would be more helpful for the coal-dependent states if the federal government would use revenue from a carbon tax to help develop the technology for carbon capture and storage.

And that brings us to the technological challenges: No plant of any size with the capacity for CCS yet exists, but it has been demonstrated to work at small scales. Three different processes for capturing the CO2 are being tested, and scaling them up for 500-megawatt or 1,000-megawatt facilities should be possible.

For two years, the Mountaineer plant in New Haven, West Virginia, has been capturing and storing a tiny amount of its CO2 -- 2 percent of it -- but plans to build a full-scale carbon-capture plant here have been abandoned. Because Congress has dropped any idea of imposing a tax on carbon emissions, the investment doesn’t make sense.

A large plant in Edwardsport, Indiana, was being constructed with the expensive gasification process that makes it easy to add carbon-capture facilities, but it, too, has been shelved.

China may finish its large demonstration carbon-capture plant before the U.S. gets any model up to scale. Others are planned in Europe, and a small one is operating in Germany. This plant has been unable to get permission for underground storage, so it is selling some of its CO2 to soft-drink companies and venting the rest.

Subterranean Storage

Storing captured CO2 is eminently possible, too. For 15 years, the Sleipner facility in Norway has been storing 3 percent of that country’s CO2 underneath the ocean floor, with no appreciable leakage. Algeria has a similar facility, the In Salah plant, operating in the desert.

One storage strategy under consideration in the U.S. is to inject captured CO2 into huge basalt formations off both the east and west coasts. Inside the basalt, the carbon gas would gradually turn into bicarbonate of soda.

There are other ways to dispose of carbon dioxide. It has been used for enhanced oil recovery for many decades without any danger, and has been effectively stored in depleted oil reservoirs. (The gas is dangerous only in high concentration.)

It remains uncertain how much of the captured CO2 might leak during storage. Even if this were as much as 10 percent, however, it would mean that 90 percent of it would stay underground.

As CCS technology develops, it will have to be made more efficient so that it uses less energy. As it is, the capture phase is expected to require that a power plant burn 20 percent to 25 percent more coal than it otherwise would.

The technological challenges may explain why energy companies haven’t lobbied for subsidies to develop CCS. The electric-energy sector isn’t known for innovation and risk- taking. Just look at the U.S.’s outdated power grid.

But the federal government could pay for the subsidies through a tax on carbon. Such a levy would have other advantages, too: It would raise the cost of energy to reflect the damage that burning coal and oil now do to the environment, and spur the development of renewable sources.

If states with large carbon footprints can’t accept such a tax, the CCS subsidies could be paid from the general fund. The cost to build coal-fired power plants with CCS technology is estimated to be about $5 billion to $6 billion -- about the price of a single nuclear power plant. The total price for the U.S.’s 500 large plants would be $250 billion. That’s as much as the planned modernization and expansion of our missile defense system over 10 years.

But it would slash our carbon emissions by at least 20 percent. There is no other politically possible way to cut CO2 as much, and as quickly -- in a decade or two. And devastating climate change is far more likely than a missile attack.

U.S. investment in CCS technology could also induce China and Europe to follow suit. And this would allow the world time for renewable-energy technologies to mature -- to the point where we could do away with coal burning altogether.

Freedom House’s Freedom in the World survey showcases an alarming decline in freedom, democracy and respect for human rights around the world for a fifth consecutive year. Only 60% of the world’s 194 countries and 14 territories can be defined as democracies with respect for fundamental human rights and freedoms.

While universal human rights are trampled upon in dictatorships as North Korea, Iran, Syria, Libya and China, the European foreign policy debate is dominated by Israel’s blockade of Hamas-controlled Gaza and the US-led war against international terrorism.

Flotillas to Gaza receive massive publicity in the European press, despite the fact that the border between Egypt and the Gaza Strip is open and the UN secretary general calling the campaign "an unnecessary provocation."

No flotillas are sailing towards Damascus and Teheran, despite the fact that Amnesty reported some 1,400 deaths in the Syrian uprising against the Assad regime, as well as rape and torture of children. Meanwhile, the Islamic Republic of Iran has executed 175 people this year, including women, children and homosexuals by public hanging and stoning.

Calls for a boycott of China are rarely issued in the European debate, although the communist regime in Beijing occupies Tibet and accounts for two thirds of the world’s executions. No fly-ins head to Atatürk International Airport, despite the fact that Turkey illegally occupies Northern Cyprus and commits systematic human rights violations in the Kurdish territories.

Elsewhere, very few European writers and cultural figures condemn the Castro regime, despite the fact that Cuba has forced 18 dissident journalists into exile this year.

The one-sidedness of the European foreign policy debate is clearly exemplified in the case of North Korea, one of the world’s worst human rights abusers according to Amnesty. A recently publicized UN report charged that some 3.5 million of the country’s 24 million inhabitants suffer from acute food shortages as result of the totalitarian regime’s policies.

Self-styled peace activists
Pyongyang has established a system of prison camps throughout the country where 200,000 dissidents are subjected to systematic torture and starvation. Forced labor guarantees that no detainees are strong enough to rebel; attempts to escape are punished with torture and execution.

Very few European campaigns are initiated in support of the North Korean people. This selective engagement can be explained by the fact that countries like North Korea don’t generate widespread media coverage or political debate. More significantly, the problems don’t fit into the dominant European foreign policy discourse, which discriminates between moral principles in the name of biased political agendas.

If the Gaza flotilla was motivated by altruistic humanism, we would have seen some boats setting sail for Benghazi, loaded with medicine and humanitarian aid. Ships with oppositional literature and laptops would have done wonders for the democratic opposition in Havana and Tehran. A universal commitment to the promotion of human rights would have prompted European public engagement against the mass starvation and torture in North Korea.

Next time self-styled European human rights and peace activists in Ireland, Sweden, Belgium, Norway, Switzerland or Spain issue declarations in the name of humanism while condemning the only democracy in the Middle East, you should think twice; specifically when these statements are motivated by a questionable commitment to the promotion of democracy and human rights in all countries of the world.

Multiculturalism does not pose a significant danger to Western values - but neoliberalism does.

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The paranoid style in politics often imagines unlikely alliances that coalesce into an overwhelming threat that must be countered by all necessary means.

In Clash of Civilizations, Samuel Huntington conjured an amalgamated East - an alliance between "Confucian" and "Islamic" powers - that would challenge the West for world dominance. Many jihadis fear the Crusader alliance between Jews and Christians. They forget that until recently, historically speaking, populations professing the latter were the chief persecutors of the former.

Now Anders Breivik has invoked the improbable axis of Marxism, multiculturalism and Islamism, together colonising Europe. As he sees multiculturalism as essentially a Jewish plot, Breivik has managed to wrap up the new and old fascist bogies in one conspiracy: communists, Jews and Muslims.

Like his terrorist counterparts who kill in the name of various Islamic sects, Breivik is willing to slaughter people for an invented purity. Modern Norway is a latecomer to the world of nations, becoming sovereign only in 1905. Vikings, Arctic explorers and international humanitarians all went into imagining the place.

Given how readily jihadi texts are dismissed as ravings, it is notable how much attention has already been paid to Breivik's wacky ideological brew. This is a worrying portent of the line of analysis that says that the "root causes" of Breivik's madness - immigration and cultural difference - must be addressed. Otherwise, European societies will lose their social cohesion, to choose one current euphemism for the Volk.

To the extent such a view takes hold, the far right may be forgiven for concluding that terrorism works. As for the rest of us, now facing terrorist re-imaginings from both sides of obscure battles in a mythic past, we may long for the leftist and anti-colonial insurgents of bygone days. They at least could offer plausible accounts of what they were up to. 

To be sure, tactically speaking, Breivik thought through his operation. Unlike many jihadis, however, he lacked the courage to face men armed like him, and to offer his own life for his beliefs as well as the lives of others. Nonetheless he wanted at his court appearance to strut about in some kind of military uniform.

Smartly tailored uniforms, an abhorrence of cultural difference, and a desire for racial purity are all of a piece with fascist mysticism. As with jihadi ideology, it is precisely the non-rational elements of fascism that give it emotive, and hence political, power. For what Breivik and others see as under threat in the West is the vital source ofmeaning, of ultimate values, which they associate with the communion of a purified people.

Since the West faces no obvious threat of such existential scale and significance, one must be fabricated. It is here that the unlikely alliance of left wing parties and Islam plays its role, purportedly importing on a mass scale Muslims to colonise Europe. In Norway, Muslims account for less than three per cent of the population; in the UK, less than five per cent. Even so, the fantastical fear of the "loss" of Europe to Islam animates many on the right. It is part of mainstream electoral politics in Europe, and has long been an element of right wing discourse in the US.

In this vision of danger, multiculturalism plays a key role. Many will have noted Breivik's odd invocation of "cultural Marxists", folks I have only spotted in small numbers in university departments and cafes frequented by graduate students. Breivik's reference is in part to the Frankfurt School, a group of German Jewish scholars who fled Hitler for the Western cosmopolis of New York.

The idea is that "Jews" have encouraged cultural mixing in the West, fatally compromising its purity and thus its values, while Muslims and Jews retain their cultural strength and identity. Europe must therefore declare "independence" and fight the Muslim-Jewish-Marxist hordes, apparently starting by killing their children.

We can only assume that Breivik has confused the computer fantasy games he played - using a busty blonde avatar named "conservatism" - with political analysis. What is truly frightening, however, is that the core of this vision of multiculturalism as a threat to the West is shared by leading political parties in the France, the UK, Germany and Italy, among others. This is why there is every chance that Breivik's murderous and cowardly rampage will achieve some of its aims. Immigration, it will be argued, has unbalanced "our" people. It is already being curtailed in all the leading Western powers.

Shut up, obey, and collaborate

The irony is that the West brought us empire on a global scale and drew its cultural, economic, and political strength from interconnections with all parts of the world. The cosmopolis of New York, London and Paris - a "brown" not a "white" West - are more appropriate beacons of a West flush with power and confidence in its values than the imaginary purification achieved through concentration camps and closed borders.

But just what might be corroding values in the West?

This was one of the questions that animated the Frankfurt School and those who influenced it. They focused on the interaction between capitalism and culture. They noted the ways in which capitalism progressively turned everything into something that could be bought or sold, measuring value only by the bottom line. Slowly but surely such measures came to apply to the cultural values at the core of society. Even time, as Benjamin Franklin told us, is money, a doctrine which horrified Max Weber in his searing indictment of the capitalist mentality as an "iron cage" without "spirit".

Note for example the ways in which the great professional vocations of the West - lawyers, journalists, academics, doctors - have been co-opted and corrupted by bottom line thinking. Money and "efficiency" are the values by which we stand, not law, truth or health. Students are imagined as "customers", citizens as "stakeholders". Professional associations worry about the risk to their bottom line rather than furthering the values they exist to represent. Graduates of elite Western universities, imbued with the learning of our great thinkers, are sent off to corporations like News International. There they learn to shut up, obey, and collaborate in the dark work of exploitation for profit, for which they will be well rewarded, at least financially speaking.

Thanks in part to the grip of corporate power on the media and on political parties, few today in the West can imagine any other politics than those of big money. In the US, and increasingly even in Europe, the income differential between the poor and the wealthy already resembles that of banana republics. The downtrodden are asked to bear the burden of a financial crisis created by bankers. America's wealthy fly their children to summer camp in tax-free private jets amid a real rate of unemployment of over fifteen per cent.

Neoliberalism has only accelerated these processes at the heart of capitalist society. Here is a far more convincing threat to Western values and "social cohesion" than the lunatic fears of fascists. Notably, this is a threat that emanates from within, not without. It is precisely social democratic parties like Norway's Labour Party - Breivik's target - which have sought to contain the corrosive effects of capitalism and ensure the survival of the West's most humane values.

Tarak Barkawi is a Senior Lecturer at the Centre of International Studies, University of Cambridge.

The views expressed in this article are the author's own and do not necessarily reflect Al Jazeera's editorial policy.