All the reasons Trump’s government investment fund is a very bad idea.
Now here’s an idea: Leverage federal assets to create a new investment fund for the political class to invest in whatever it pleases, including private companies. What could possibly go wrong?
The answer is plenty, which is why President Trump’s proposal Monday to create a new sovereign wealth fund deserves to die in Congress. His executive order included scant details. But it said the fund would “promote fiscal sustainability,” “establish economic security for future generations, and promote United States economic and strategic leadership internationally.” More likely, it would take resources from the private economy, fund political boondoggles, and mess with the business decisions of private companies.
The real danger is not the existence of a government investment fund. The Canada Pension Plan is a government investment fund and one of the best investors in the world.
ReplyDeleteThe real danger is that the government won't keep it's hands off it when it wants quick funds for some vote-buying scheme. We had that in Canada where the government, after overspending by a trillion dollars, suggested they might dip into the CPP.