DC Watch
United States Assets “For Sale”
Who is Minding the Store?
By Carolyn Cormey
Where foreign governments and state-owned companies used to invest in US Treasuries, they are now often choosing to buy US Companies and even our highways and bridges! According to the Bureau of Economic Analysis (BEA), in the past 15 years, foreign-direct investment has been nearly $2,000,000,000,000 (trillion). Around 10% of this amount has been foreign-direct investment that has created new business, adding jobs and production here inside the United States. The other 90% was spent to acquire company assets, brands and patents, often resulting in company or plant closures with jobs and dollars leaving our country.
The US Commerce Department has been keeping track of the foreign entities who have been buying our US Companies and assets. They have been collecting detailed records on the entity making foreign-direct investment and the details on whether the transaction created more jobs and productivity in the United States or sends them out of the country. Apparently, not anymore! According to CNN, the Commerce Department recently announced that they were no longer going to keep detailed track of the foreign companies or governments who buy US companies and assets because it involves a lot of work and it is too expensive to collect this detailed information (about $600,000 per year, according to a BEA spokesman). As an interesting note – the BEA has not had a budget cut.
To cover government spending, we have continued to increase borrowing from foreign governments, including China and even Iran. Now, with our soaring National Debt and trade deficits, along with our devalued dollar, broader investment choices in the United States have to be made available to entice foreign money. Investment in and ownership of US Companies is more attractive to foreign-entity investors than low interest rate US Treasuries. Americans are already extremely concerned about their companies and jobs leaving the country. As foreign ownership increases, it could become even more alarming to the public to see US Assets and companies being sold off to foreign entities to solve our economic problems. If these sales are not monitored and reported . . . they cannot get leaked or reported to the public and those politicians allowing this to happen are not held accountable.
On January 23, 2008, President Bush issued an Executive Order Amendment, providing guidance concerning the implementation of the Foreign Investment and National Security Act, stating that the US “unequivocally supports international investment, which promotes economic growth, productivity, competitiveness, and job creation,” . . . . “consistent with the protection of the national security.” If the Commerce Department is no longer monitoring and providing details, how will we know whether a foreign-direct investment creates more American jobs and productivity OR sends them out of the country?
So – who will be watching the store, monitoring the inventory and sales of our US companies and assets? I guess that would be nobody? US Companies are for sale! Wanna buy a bridge or a highway? China has plenty of money that we have provided through our huge trade deficit. With their $2 Trillion in Reserves and their Sovereign Wealth Fund of over $3 Trillion, China is ready and anxious to buy USA and so are a lot of other countries around the world!
People we send to Washington DC for a season are making these transfers much easier and far less transparent to the public if they allow the Commerce Department to discontinue the detailed monitoring and reporting on foreign-direct investment in our US companies and assets. Congress is aware that this is happening. Will they step in and require detailed records to be kept and made available to the public OR is it just another one of their responsibilities that they ignore in this political season where all things are about the election?
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