[Interesting] Matt Taibi: America is literally for sale..

Mathloom · Oct 19, 2010

I found this article interesting, but can't really form a view around it. I've seen this guy's name mentioned around here before, but I'll have to look into who he is and what he stands for.

To add my own personal insight, I doubt that he has a "friend" (from the restaurant, who works at an SWF) who told him all this and was happy to have it published. He seems to hint that his friend works for the Abu Dhabi Investment Authority hoping that the reader believes that.

Given that the description of his friend is fairly specific, I'm going to send the article to someone in the Abu Dhabi Investment Authority and if he does work there, I'm sure he will have to explain why he's discussing confidential business with Matt Taibi.

Here's the first page, click on the link for the rest of the article:

In the summer of 2009 I got a call from an acquaintance who worked in the Middle East. He was a young American who worked for something called a sovereign wealth fund, a giant state-owned pile of money that swims around the world in search of things to buy.

Sovereign wealth funds, or SWFs, are huge in the Middle East. Most of the bigger oil-producing states have massive SWFs that act as cash repositories (with holdings often kept in dollars) for the revenues generated by, for instance, state-owned oil companies. Unlike the central banks of most Western countries, whose main function is to accumulate reserves in an attempt to stabilize the domestic currency, most SWFs have a mission to invest aggressively and generate huge long-term returns. Imagine the biggest and most aggressive hedge fund on Wall Street, then imagine that that same fund is fifty or sixty times bigger and outside the reach of the SEC or any other major regulatory authority, and you've got a pretty good idea of what an SWF is.

My buddy was a young guy who'd come up working on the derivatives desk of one of the more dastardly American investment banks. After a few years of that he decided to take a step up morally and flee to the Middle East to go to work advising a bunch of sheiks on how to spend their oil billions.

Aside from the hot weather, it wasn't such a bad gig. But on one of his trips home, we met in a restaurant and he mentioned that the work had gotten a little, well, weird.

"I was in a meeting where a bunch of American investment bankers were trying to sell us the Pennsylvania Turnpike," he said. "They even had a slide show. They were showing these Arabs what a nice highway we had for sale, what the toll booths looked like . . ."

I dropped my fork. "The Pennsylvania Turnpike is for sale?"

He nodded. "Yeah," he said. "We didn't do the deal, though. But, you know, there are some other deals that have gotten done. Or didn't you know about this?"

As it turns out, the Pennsylvania Turnpike deal almost went through, only to be killed by the state legislature, but there were others just like it that did go through, most notably the sale of all the parking meters in Chicago to a consortium that included the Abu Dhabi Investment Authority, from the United Arab Emirates.
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Would love to hear your thoughts. Seems a bit dramatic.

Rashmon · Oct 19, 2010

Gil Scot Heron had a great song about 30 years ago touching on this...

"What has happened is that in the last 20 years, America has changed from a producer to a consumer. And all consumers know that when the producer names the tune…the consumer has got to dance. That’s the way it is. We used to be a producer – very inflexible at that, and now we are consumers and, finding it difficult to understand. Natural resources and minerals will change your world. The Arabs used to be in the 3rd World. They have bought the 2nd World and put a firm down payment on the 1st one. Controlling your resources will control your world. "

Gil Scot Heron

rhadamanthus · Oct 19, 2010

The toll road from Chicago to South Bend has been owned by a group of Australian businessmen for a while. The only stipulation is that the toll could not be increased for something like ten years. After that, who knows.

Ottomaton · Oct 19, 2010

Mathloom said:

I found this article interesting, but can't really form a view around it. I've seen this guy's name mentioned around here before, but I'll have to look into who he is and what he stands for.
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My personal opinion is that Tabbi's self-identity and ego has become so heavily invested in being "the guy who writes stories about how messed up things are" that I no longer trust his impartiality.

Invisible Fan · Oct 19, 2010

Ottomaton said:

My personal opinion is that Tabbi's self-identity and ego has become so heavily invested in being "the guy who writes stories about how messed up things are" that I no longer trust his impartiality.
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Yeah. I like some insights he pulls out, but he has to take it down a notch and let the facts speak for itself.

Foreign capital investment props up our market. If we were to rebound, we could buy it back in time. In the 80s, everyone was afraid Japan would take us over. It turned out they overpaid on many of their investments here..

I need a little more than one really bad deal. These deals are shadowy, but that in itself doesn't imply all of them are skewed against the taxpayer.

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