Trump’s Sovereign Wealth Fund & Pelosi

Trump is usually but not always right. Take his sovereign wealth fund idea. Please. Since government doesn’t create wealth (unless you are USAID) a SWF would “merely be one more way for gov’t to commandeer private wealth for political purposes.”

That was the takeaway for the WSJ’s editorial board. They even counted the ways in an op ed: “Why has no President done this before? One reason is the US perennially runs budget deficits, projected at $1.9 trillion for this fiscal year. Countries with sovereign wealth funds typically invest surplus revenue from commodity sales or excess foreign exchange reserves from trade surpluses, e.g., China.” How about “monetizing” the federal government’s assets, estimated at $5.7 trillion, to get make the numbers work? Because, say the editors, “federal assets aren’t what they seem. Washington’s biggest asset is its $1.6 trillion in student debt, about a quarter of which is already set to be written off. Other phantom assets include hundreds of billions of dollars in loans for disaster relief, low-income housing & green energy. The US also owns some $2.6 trillion in [often DEPRECIATING] property, software, plants & equipment.”

But, perhaps the biggest reason NOT to leverage federal assets to create a new investment fund for the politicians to invest in whatever they want, including private companies? Concludes the editors: “Politicians would love a separate vehicle to direct capital without having to go through Congress” and public scrutiny ala the already highly criticized Nancy Pelosi Wealth Fund?

Davd Soul