Honest question: What, if anything, does a country gain from nationalizing mining over just taxing it - besides scoring political points that is?

In other words, would an economist be able to point out any benefits?

You get board seats for your political buddies. If company is privately owned you cannot simply appoint someone to a board to get nice salary.

So no socioeconomic benefits. And likely drawbacks in terms of reduced revenue. So I assume that the next government will dispense with this nonsense.

Too late. What investor will want Chile now? You make one peep about nationalization, and we all go stampeding the other direction. The whole place just went radioactive from capital’s perspective.

The gain is not having to share profits with a private company.

Another gain is more control over the investments the company makes. The profits can be reinvested in the country instead of in the neighboring country that just slashed their corporate tax.

Another gain is reduced foreign influence over a critical portion of the nations economy.

Of course there are also drawbacks. Reduced access to international knowhow and capital etc. It's a trade off.

> The gain is not having to share profits with a private company.

Typically, it means the local warlord and his family get to pocket it.

Can you name one Chilean warlord, or are you uncritically regurgitating a meme about developing countries?

Your idea assumes the state will run it as efficiently as private businesses would. That sounds nice in theory but in the vast majority of cases isn't the reality of it.

I'm always intrigued/entertained/confused by this line of reasoning. What companies have you worked for that were highly efficient and made rational long-term strategic decisions?

I'm not saying a state entity would be inherently better (though a case could be made for the benefits of long-term thinking that are more built-in) but I'd like to see the evidence that corporate businesses are inherently better themselves.

Individual corporate entities have their own flaws but the competition between them is a structure that eventually forced inefficient entities out. So Intel eventually finds themselves overtaken by a TSMC. But with govt entities, no such structure exists.

I understand the argument, but it seems large companies are seldom, or never, overtaken by others. They entrench themselves by regulatory capture, advantages of economy os scale, and survive virtually indefinitely even in shrinking markets

If we don't count "missing the boat" (as happened regarding search/mobile/social media), which arguably happens because of disruption from the newcomers and not mismanagement/underperformance at the oldtimers, what large companies have failed in the last 20 years?

Core to this point is that mega companies are only at threat from disruption, and it doesn't matter whether they're private or state owned for that

(I am of course ignoring companies that go under from criminal, as in corruption, mismanagement. I guess those are much more prevalent between the state-owned, for obvious reasons)

The state can own the capital/resource and make multiple corporate entities compete (efficiently) as workers.

There's a shortage of key mineral reserves, but an abundance of corporate entities.

In capitalism, competition is on a higher level of abstraction than the employee’s (even the CEO)’s performance.

The entire company will go up or down according to output, even if due to external circumstances. Capital gets reallocated to better performing companies.

Examples: IBM, HP, Dell went from dominating to the doghouse; Microsoft made excellent strategic choices and remained relevant; Apple went from the doghouse to dominating, and so on.

This filters down to the employees. There is much more turnover and harder work (and higher pay) in private companies than at the government.

There’s a mixed track record. Saudi Aramco for instance became the largest oil operator generating lots of profit for its home country. Norway’s Statoil is another.

Wasn't Saudi Aramco a 50/50 arrangement with the private American company for most of it's history when it was developing the main oil fields? I believe the companies agreed to this because the Saudi's threatened to nationalize it completely.

The Norwegian one was a gov corporation from the beginning though and was there from the beginning of exploration/development.

There can also be a long-term benefit that post-nationalized orgs from their past state as private structures, living off the fat as they say. The existing talent/prior knowledge/industry relationships are still there, just with a new owner and more capital. Similar to NASA absorbing a well established and already highly productive private industry / university researcher pool, and merging them under one umbrella and then having a golden era of productivity before sliding back into a more normal public agency.

That sort of productivity naturally fades over time as the gov bureaucracy increasingly takes over and the natural constraints of politicized funding.

It helps if your business is a slow changing monopoly industry like oil/gas though.

And economic ideology is less important to that mixed track record than is generally believed, regardless of which camp people subscribe.

>in the vast majority of cases isn't the reality of it.

Extraordinarily claims require extraordinary evidence, of which none is provided. Public actors do not have, among many other negative characteristics, enshittification incentives. Greed is a malignant cancer that ruins human lives if left untreated.

Capitalists are greedy for profits.

But bureaucrats are greedy for power.

It doesn't have to be as efficient ... a hyper-efficient private business that shift most of it's profits to a tax haven (as they all do) provides less benefit to the country than a moderately efficient state enterprise that invests all the gains back into the country.

The point is for the country to take the role of "business owner", and to relegate the private businesses to the role of an "employee" (with a commensurately smaller slice of the upside) ... and if they don't like it, someone else will take their place ... after all the country has a guaranteed monopoly (they own the entire resource).

Biggest drawback is the government's complete inability to exploit said resources. Didn’t anybody learn Venezuela's lesson?!

Or Norway's? ... wait a minute.

I never seen Norway model successfully replicated anywhere else. Maybe it requires something else as well, like… Norwegians?!

Are you saying only Superior Nordic White People could possibly do things the right way? All those PoC are inherently corrupt or incapable of building functioning systems?

That sounds... racist.

Some people have suggested that it was in fact an Iraqi that set them on the right path, after seeing it go wrong in his own country:

https://psmag.com/.amp/environment/iraqi-vikings-farouk-al-k...

> Norway’s anti–resource curse is often attributed to exceptionalism: Viking genes or the like. But one secret of its success—maybe the secret—is not Norwegian at all, but a twinkly 77-year-old Iraqi-born oil geologist named Farouk al Kasim.

Did the “Norwegian” model work in Iraq first then? If not, why not?

It’s not race but it may be culture. Not what color Norwegians are, but what they do. Things like corruption, education, religion, ethics, customs and life/work habits all influence productivity. Also here in Europe at least there seems to be a correlation between latitude and country performance which could imply some climate influence as well.

Norway owns significant shares in Statoil but it is not nationalized. It's a public company listed on stock exchanges.

The government owns 67%, a controlling interest.

> The gain is not having to share profits with a private company

I'm asking about the Chile situation, not a 100% nationalized situation.

Chile also has a leftist president now with a strong desire to protect the environment and lithium mining can be very harmful to the environment. Obviously a big reason Lithium is valuable is for EV batteries. Managing these resources to prioritize the the health of the planet will probably look very different than prioritizing profits, so it makes a lot of sense for the government to step in.

As long as the most important health of the plant factor isn't maximizing extraction, which given the climate crisis it _could_ be. Kind of an interesting juxtaposition in general -- normally we think of them going hand in hand.