That is especially true when the extractive industries decline. In West Virginia, for example, many communities that have relied most heavily on extraction have experienced lower than average growth in personal income, population and employment and have higher poverty rates, lower median incomes and worse health outcomes.
Stiglitz argues that turning a resource curse into a resource blessing, is possible but it won't happen on its own and it won't happen easily. To make it happen, resource-rich places need to do more to ensure that their citizens get the full value of the resources and that the money gained from these resources is used to promote development.
In West Virginia, an idea seems to be gaining traction that just might help our state's rich natural resources into the blessing they should be. The idea is pretty simple: Take a portion of the severance taxes from resource extraction and create a permanent mineral trust fund, sometimes called a Future Fund.
The money set aside for this purpose should be prudently invested and the principal should be inviolate. Once such a fund has accumulated, the interest from it could be a permanent source of funding for West Virginia, one that could be used to promote economic development via investments in infrastructure, workforce development, early childhood education or other means.
This isn't a new and untried idea. It's something that a number of other resource-rich states have done, including Alaska, Montana, New Mexico, North Dakota, Utah and Wyoming. Our legislature will be studying this issue during interim sessions. With luck-and a lot of public support, study may lead to actual legislation.
The Marcellus Shale natural gas boom now taking place in northern West Virginia provides us with a golden opportunity to set aside a portion of the growing share of gas severance taxes. If we act soon, we can convert nonrenewable resource revenue into an enduring stream of wealth for generations to come -- and ensure that our mistakes in the 20th century don't become our fate in the 21st.
West Virginia could use a blessing.
Wilson, director of the American Friends Service Committee's West Virginia Economic Justice Project, is a Gazette contributing columnist.