The green transition has an uneven geography, and their profound consequences are being experienced outside the policy corridors of Brussels and Washington. The water quality erosion or road blockades can be observed in the distant salt flats of the Atacama, Cajamarca in the Andes, and the lithium brines across Chile, Argentina and Bolivia. The raw materials we need to build battery and EV cars alongside the graphene and rare earths to be extracted for wind turbines are not taken from the mines in the global North.
We usually argue about the changing geopolitics of critical minerals in the language of security: who controls the minerals, how far ahead China is in refining, whether the West can lock in “friendly” supply. I spend most of my time in those debates. But there is a prior question the security framing that is swept under the carpet (though increasingly hard to do so) — and it is the one that will actually decide how this decade goes for the countries holding the minerals. What will the boom do to their democracies?
The scramble for lithium, nickel and copper is not just a supply chain story. It is a structural test of which democracies have built the institutional capacity to govern a boom — and which will be hollowed out by one.
A word on where I’m coming from, because it shapes how I read all of this. I’m known these days for critical minerals and industrial policy — but it was never only about minerals, and it is not where I began. My early work was on labour and civil society in Latin America’s left turn, specifically on Chile’s copper unions, and the harder question of who really gets a seat at the table when a state claims to govern in the name of development. I co-edited a book in 2017, Demanding Justice in the Global South, about how ordinary people claim rights, and I once asked, at some length and to my mild surprise a fair few times since, who actually owns a country’s minerals. Even Business of the State, my book on why governments still run oil and mining companies, is at bottom about union politics — the bargains states strike with labour and capital. I’m now co-editing a handbook on democratization. So this chapter is not a detour into democracy from a safe distance; it is the question I’ve been circling for twenty years.
Chile kept the state it built. Venezuela lost the one oil had given it.
We have run this experiment before, and we know how it can go.
Start with Venezuela — the cautionary tale, though not for the reason most people know about. Oil wealth did not curse the state; in fact, hydrocarbons brought political modernization to the caudillo state. The anthropologist Fernando Coronil called it the magical state: a government that seemed to conjure modernity straight out of the ground, paying for highways and universities and, above all, underwriting a pacted democracy in which two parties managed the terms of politics for four decades. For a long stretch it worked — oil built real state capacity, financed expensive infrastructure and grand industrial ambitions, and that same capacity underwrote a functioning, if tightly controlled, democracy. What broke it was not the oil but the weakened political will to undertake difficult reforms when there was plenty of time and resources. When the model was liberalised through the 1980s and 1990s and the state’s role dismantled, the old pact lost its legitimacy and unravelled into the crisis. The societal rejection to party politics was underpinned by caracazo protests, whereby people went to the streets to reject narrow democratic practices. Ironically, this was the origins of a movement that produced Chavismo — and, eventually, the patrimonial hollowing that finished the job. The moral runs opposite to the folk version of the resource curse: Venezuela’s tragedy is not that oil made a strong state impossible, but that a state oil had made strong was taken apart.
Now set Chile beside it. Chile mines more copper than anyone on earth — I’ve followed its copper politics since my first fieldwork in 2009 — and it has spent fifty years keeping the state in the game, most visibly through Codelco, the state copper company that even the Pinochet dictatorship left in public hands. As lithium becomes the mineral everyone wants, Chile has done something quietly revealing. Rather than nationalising by decree, or auctioning the deposits to the highest bidder, it has used a simple fact — that the state owns the subsoil — to turn the expiry of mining leases into leverage, and struck a lithium partnership in which the state stays a player, not a spectator.
That sounds technical. It is the whole point. Chile’s resource nationalism runs through contract administration, not expropriation — a form of power available only to a state with the capacity to write, monitor and enforce complex deals across decades. It is no fairy tale. The fights in the Atacama over water and consent are real and unresolved. But it is a different trajectory from Venezuela’s, and the difference is not the mineral. It is the state. Chile kept the state it built. Venezuela lost the one oil had given it.
This is the argument at the centre of the chapter I’ve just finished with my collaborator José Carlos Orihuela, for the SAGE Handbook of Democratization. We give the thing worth aiming for a name — resource democracy — a way of governing extraction in which the decisions that matter (who digs, who benefits, who is left with the poisoned water) are genuinely accountable, rather than handed down by an executive or a boardroom. In truth it is an old idea for me. More than a decade ago, in my first book, Jean Grugel and I argued that resource booms are at heart a question of citizenship — who counts as a stakeholder, who is owed a say, who carries the costs. Resource democracy is where that thread leads once the energy transition makes it urgent again.
If you want to know what kind of state you are actually dealing with, look at how it taxes. Not just how much, but who pays and how: whether the fiscal burden falls on a state enterprise or on foreign capital, whether royalties are transparent or negotiated behind closed doors, whether citizens are taxed and represented or simply handed a share of the rent to keep them quiet. Taxation is where the social contract is written. And that is why resource democracy is not something you bolt on after the fact — a little consultation here, a community fund there. It is constitutive of how resources are governed in the first place. The ownership model, the fiscal rules, and the terms of consent are not the packaging around resource governance. They are the thing itself.
Resources are neither a blessing nor a curse. They are a test of the state.
The history is humbling on this. You do not get resource democracy from owning the right resources, or from flying the right ideological flag. Left governments have hollowed out states as thoroughly as right ones. Bolivia and Ecuador wrote radical, participatory constitutions recognizing the so-called right of nature in the 2000s. And then, their governments found them inconvenient the moment the budget depended on drilling. Resources, in the end, are neither a blessing nor a curse. They are a test of the state.
Here is the part that should worry us now. Decarbonisation depends on intensifying extraction in exactly the places that already carry its scars — often the same valleys and salt flats where earlier booms left contaminated rivers and broken promises. When Brazilians talk about lithium and rare earths, they are also, always, talking about the tailings dams that collapsed at Mariana and Brumadinho and killed hundreds. “Green” extraction can corrode a democracy just as efficiently as the dirty kind, if it is done to communities rather than with them. There is nothing automatically democratic about a clean energy mineral.
You do not get resource democracy from owning the right resources, or from flying the right ideological flag. Left governments have hollowed out states as thoroughly as right ones.
For me, this chapter is not a full stop but a starting gun. It opens a research agenda I’m now taking forward through a new Critical Raw Materials Policy Lab — a Global South–anchored platform for the countries that actually host extraction, built to help turn mineral wealth into productive capability rather than another cycle of rents. The chapter’s argument lands most directly on the Lab’s third pillar, territorial legitimacy: the plain question of whether mining can be made legitimate to the people and places that live with it. Why do conflicts escalate? Which participatory tools — prior consent, benefit-sharing, community monitoring — actually work, and which are theatre? Can access to markets and finance be tied to how a company treats the territory it operates in? These are not soft questions at the edge of the minerals debate. On the evidence of the last century, they are the whole game.
I am not optimistic by default. Much of Latin America is drifting toward concentrated executive power and thinner accountability, and a mineral windfall is precisely the kind of accelerant that drift feeds on. But the most important thing I’ve learned from this history is also the most hopeful: the outcome is not written by geology. Venezuela’s collapse and Chile’s contract were both choices — made by states, and by the societies pushing on them.
The transition will redraw the map of who profits from the ground. Whether it also redraws democracy, for better or worse, is still genuinely open. That is the stress test now underway — and it is worth watching closely, even from very far from a salt flat.
The chapter, “Constructing Resource Democracies in Latin America” with José Carlos Orihuela, is forthcoming in the SAGE Handbook of Democratization. More on the Critical Raw Materials Policy Lab — and its work on territorial legitimacy — soon.