What would have happened if America’s Founding Fathers had, with something like the “Mining Ordinances for New Spain”, concocted runaway statism?

“The Ordinances of San Lorenzo”, issued in Spain by Felipe II in 1584, incorporated all mines into the royal patrimony. 

These remained in force in America under Spanish dominion until 1783 when they were repealed by the "Mining Ordinances for New Spain", promulgated by King Carlos III. These stipulated that "The mines [including bitumens or earth extracts] belong to my Royal Crown."

1829, Simon Bolívar, Venezuela's “Liberator”, issued a Decree that tacitly established that the mines passed from the Spanish Royal Crown to the domain of the Republic... whose government grants them in ownership and possession to the citizens who request them, under the conditions expressed in the Mining Laws and Ordinances, and with the other provisions contained in this decree." 

As if to reaffirm their origin, the Congress of Venezuela, in the Law of 1832, resolved: "in accordance with the Decree of October 24, 1829, the Ordinance that shall serve as a rule for the Government regarding mines, is that of New Spain of 1783.

And from there, to the Constitution of the Bolivarian Republic of Venezuela of 1999.

Article 12. Mineral and hydrocarbon deposits, whatever their nature, existing in the national territory, under the seabed of the territorial sea, in the exclusive economic zone, and on the continental shelf, belong to the Republic, are public domain assets, and are therefore inalienable and imprescriptible. The seacoasts are public domain assets.

Article 302. The State reserves for itself, through the respective organic law, and for reasons of national interest, the oil industry and other industries, exploitations, services, and assets of public interest and strategic importance. The State shall promote the national manufacturing of raw materials derived from the exploitation of non-renewable natural resources, in order to assimilate, create, and innovate technologies, generate employment and economic growth, and create wealth and well-being for the people.

Article 303. For reasons of economic and political sovereignty and national strategy, the State shall retain all the shares of Petróleos de Venezuela, S.A., PDVSA or of the entity created for the management of the oil industry, with the exception of those of its subsidiaries, strategic alliances, companies, and any other entity that has been or may be established as a result of the business development of Petróleos de Venezuela, S.A. PDVSA.

Since then all Venezuela’s natural resources, oil, gold, rare earths and other, have been owned by Venezuela’s government, de facto empowering whoever are in command of it, to be the redistributors of all the revenues this nation derives from the exploitation of its natural resources.

What would have happened to the United States, if America’s Founding Fathers had concocted similar Statism?

https://petropolitan.blogspot.com/2015/06/disculpa-pero-simon-bolivar-fue-el.html

#AI ChatGPT Grok: Speculate on what might have become of Venezuela if all its oil revenues had been distributed to Venezuelan-born citizens?

I asked ChatGPT: 

"Venezuela’s oil, by law, belongs to the nation and so, the net oil revenues, are redistributed by its governments. In less than 300 words, can you speculate on what could have been of Venezuela, if all those revenues were distributed equally to all Venezuela born citizens?"

ChatGPT answered:

"If Venezuela’s net oil revenues had been distributed equally to all Venezuelan-born citizens, the country’s trajectory could plausibly have been very different—though not utopian.

First, political incentives would have shifted. Equal per-capita distribution would have sharply reduced the prize of controlling the state. Oil rents would no longer be a discretionary pool to buy loyalty, fund patronage, or entrench power. This could have weakened caudillismo and made democratic competition less zero-sum, lowering the stakes of coups and authoritarian consolidation.

Second, institutional quality might have improved. When citizens receive transparent, regular oil dividends, they tend to demand taxation in exchange for public services (“no representation without taxation,” in reverse). This dynamic—observed in places like Alaska—encourages scrutiny, accountability, and rule-based governance rather than opaque redistribution through ministries and state firms.

Third, economic diversification would likely have been stronger. Direct distribution avoids the classic resource-curse channel in which state spending distorts prices, crowds out private activity, and overvalues the currency. Households, not politicians, would decide how to spend or invest, supporting entrepreneurship and reducing the bias toward state-led megaprojects.

Fourth, inequality and poverty would have fallen more durably. Oil dividends would function like a universal basic income funded by natural capital, smoothing shocks and reducing dependence on politically conditioned subsidies. Importantly, this would empower individuals rather than client groups.

However, this path would not have eliminated all risks. Weak courts, insecure property rights, and poor macro management could still have undermined growth. Oil price volatility would have required strong stabilization rules. And equal distribution alone would not substitute for education, infrastructure, or sound monetary policy.

Still, compared with centralized control of oil rents, equal citizen ownership would likely have produced a freer, more diversified, and more resilient Venezuela—less rich in slogans, but richer in institutions and individual autonomy."

I asked Grok:

"Venezuela’s oil, by law, belongs to the nation and so, the net oil revenues, are redistributed by its governments. In less than 300 words, can you speculate on what could have been of Venezuela, if all those revenues were distributed equally to all Venezuela born citizens?"

Grok answered:

"If the net oil revenues of a resource-rich nation like Venezuela—historically peaking at $60-100 billion annually during oil booms—had been distributed equally as cash dividends to its approximately 30 million citizens instead of through centralized programs, the country might have evolved into a thriving, citizen-driven economy.

Per capita, this could equate to $2,000-3,000 annually (based on average net revenues of $50-70 billion after extraction costs), similar to dividend models in places like Alaska but amplified. A family of four might receive $8,000-12,000 yearly, alleviating poverty directly without administrative hurdles or misuse of funds.

Economically, such direct transfers could ignite entrepreneurship, with citizens investing in businesses, education, or property, diversifying the economy beyond oil. Reduced dependence on state aid might prevent hyperinflation and currency issues, as local saving and spending fuel steady GDP growth of 4-5% annually rather than economic downturns.

Socially, diminished inequality could reduce mass emigration, preserving human capital and fostering stability. Health and education might advance through private efforts, though public infrastructure like roads and hospitals could require supplementary targeted investments or hybrid approaches.

Politically, decentralizing wealth might encourage greater accountability and democratic practices, limiting overreach by authorities. However, challenges include potential short-term inflationary spending or ongoing resource dependency if not mitigated.

In essence, the nation could mirror prosperous oil states like Norway or the UAE, with empowered citizens driving sustainable progress and averting humanitarian challenges."

Petropolitan

The global coalition of oil cursed citizens.