The child malnutrition rate (moderate and severe) here is at 27%, literacy at 47 and 31% (male and female, respectively), and 51% of the population is below the international poverty line of $1.25 per day. A recent rebellion, followed quickly by a coup d'etat and a saturation of the north by Islamist terrorists, has exacerbated this poverty-stricken country's existing problems, and created a new crisis of 400,000 refugees and internally displaced people. Now all the people have to look forward to is war and international military intervention.
Corruption, an eroding terrain, and the hangover from decades of colonial rule, have conspired to make this country the 12th poorest in the world.
This is perhaps all the more surprising given that this nation is the third biggest producer of gold in Africa.
In 2011, 43.5 tons of gold (worth $2.7 billion at today's spot price) were mined in this country. Now let's imagine that this nation were a Scandinavian-style democracy, with superb infrastructure and a socially egalitarian government. If this gold wealth could be perfectly redistributed then the GDP per capita of this country would increase from $668 to $837. That's 20% a year more for every man, woman and child in the country, and I can assure you that this would make an enormous difference to the lives of people here.
To continue the thought experiment, let's note that to achieve the same increase in GDP per capita in the USA it would have to produce 53,267 tons of gold per year, or about one-third of the total gold thought to ever have been mined in human history.
In other words, the poor African nation has a resource option available which (purely theoretically and in a utopian sense) could raise it's economy by 20% per year. The USA cannot do this, as its economy is at such an advanced level that further increases are exceptionally difficult to achieve: it's the law of diminishing returns. Therefore, when the US economy is in trouble, it resorts to silly things like quantitative easing and zero interest rates, and Europe does the same but throws in a self-imposed austerity vicious cycle nightmare for good measure. To reduce US debt by 20% one needs to devalue the US dollar by 20%; compare this to the gold-producing nation's brand of QE which is to dig the stuff out of the ground. The two approaches are not entirely dissimilar in more than one sense.
But I digress. The African nation sees nothing like these increases in GDP, of course, and I think we probably all know the reasons for this, so I won't dwell on them here. But essentially, the country is an an almost unique position in that it could theoretically raise its living standards by 20%, but is unable to do so because the greater majority of the profits from mining go overseas or are syphoned off through corruption. Therefore it gets about 5%, and this 5% is distributed extremely unequally.
untrue) analogy with the Dutch buying Manhattan for some beads is apposite.
This fiat-backed resource grab is, of course, the same for oil. Only it isn't. Because, by a quirk of history (perhaps) the oil-producing nations of the Middle East have been largely able to profit from their natural wealth. They are therefore not in the position of being forced to continue to sell it. In other words, as the dollar devalues, and as ZIRP remains the flavour of the decade, the motivation for OPEC to drill more black stuff out of the ground decreases. There is evidence that this is already happening: there is simply no incentive for, say, Saudi Arabia to continue to receive $US in order to immediately trade them for non-performing treasury bonds. We're not yet at the point where OPEC members will start to overtly cut back on production, but I suspect we're not too far away. Regardless, they have the choice: their economies no longer need foreign currency.
So next time you read a comment on the silverogosphere about the wickedness of the United States' wealth being shipped east to China, or the fact that citizens are being robbed by a devaluing dollar, spare a thought for my neighbour and his wife and his six children. He worked in a gold mine for fifteen years, but has never owned any, nor will he. He has no wealth to protect. And I imagine that he finds it rather difficult to conjure up too much sympathy for an insane financial system that plunders his country's hard assets in exchange for devaluing fiat, and then uses this resource to shore up the wealth of those on the planet who need it the very least.
Greed and Gold have always gone hand in hand. It's just that the financial system and world economy is now so ruthlessly efficient at sucking value from the productive and concentrating it in the hands of an increasingly tiny minority that Greed and Gold are essentially synonymous.