Chinese Sovereign Wealth Funds.
Today a report by "60 Minutes" aired on CNBC concerning global business caught my eye; a section of it was devoted to documenting the rise of Chinese sovereign wealth funds such as the China Investment Corporation in the U.S. business sectors. It talked about the general atmosphere of apprehension and suspicion the Chinese "interference" with our domestic affairs has been greeted with. There is an interesting point to be brought up concerning this fear that Chinese involvement could destabilize our economy and increase Chinese leverage along with our foreign dependency.
I myself am a Chinese- American, and the pro-American part of me perfectly understands this wariness; after all, China is rapidly increasing its international hegemony, often at the expense of the United States. Cheap Chinese imports have cost us American jobs and productivity, the Chinese are Communist... and so on goes this laundry list of woes.
Yet my pro-Chinese stance can be summed up in four words: Do not flatter yourselves. Sovereign wealth funds are made to generate one thing: wealth. It is pure and simple human greed that runs these funds not political patriots or fervent communists that are looking to cripple the "capitalist monster" that is the United States. Gao Xiqing, the president of the China Investment Corporation, graduated from Duke and worked in Richard Nixon's former law firm. Human greed and desire for capital, the same factors that are running these sovereign wealth funds, outweigh human nationalistic tendencies. If the United States economy were to suffer due to Chinese interference, Chinese sovereign wealth funds would crash and burn along with it. China Investment Corporation has lost $2 billion due to investing in U.S. companies during the recession; If the U.S. goes down, China will suffer significantly as well. This is an example of the increasing interdependence of this era of globalization, not an ode to Cold War tendencies of clandestine manipulation.
Granted, I am not a renowned economist...or an economist at all. I am a man of common sense. But if, somehow, I were to go online tomorrow and see the headlines "CHINA FIRESALES ALL U.S. HOLDINGS" and "CHINA INITIATES FINANCIAL ARMAGEDDON" then that will truly be the surprise of my lifetime. For, not only will these developments mean critically permanent damange to China and the global financial system, but they will also go against every fiber of human greed.
And history has shown it is unwise to bet against human greed.