Wealth of Nations

Whenever I figure out the direction of the new blog, I may go back and transfer some of the posts. This below ties into what I'm working on right now, thus tying in my work with my blog and creating a bit of real world connection.

Here is a thought that crossed my mind as I put together a conference on Sovereign Wealth Funds.

I'm curious as to what is the official 'free markets' view (if such a thing exists officially) on Sovereign Wealth Funds. On one hand, opposition to SWFs seems protectionist - on the surface, they're no different than other large investment bodies such as hedge funds (which also come under scrutiny for their opacity). On the other, let's consider where this money comes from: Either state controlled natural resources, or excessive taxation. If a government surplus exists, shouldn't it go back to its citizens? Is there a reason a government should hold a stake in US financial firms rather than the country's citizens? This is money being taken from private citizens for use by a government - which is then buying stakes in private enterprises. Many of these governments – China for example – are top down and non-representative.