Oil Buys a Lot of Stuff
September 20, 2007
Only about 20 minutes ago the Associated Press ran a story indicating that the Nasdaq, the electronic stock exchange in the United States, has agreed to sell a 20% stake in itself to the Borse Dubai, a government controlled company in the Middle East. Borse Dubai is also purchasing a 30% stake in the London Stock Exchange, and once the deals are done, will own the controlling stake in two of the world's biggest financial exchanges. Unsurprisingly, congress, both Democrats and Republicans are up in arms over this deal. How could we let a foreign government (and one from the Middle East no less) control two western financial exchanges? After all, hasn't Al Quida made it clear that they intend to use the US economic system as a conduit to wreak havoc on our country?
The problem is that Congress is asking the wrong questions. Its easy to understand why Nasdaq would be willing to Borse Dubai: money. In a capitalist system the almighty dollar trumps everything else - and if Borse Dubai is willing to pay a pretty penny for Nasdaq, then how could the American company say no?
The question that Congress needs to ask is why the government of Dubai has so much cash to begin with? The answer is one that politicians don't like the answer to, which is probably the reason why they're so unwilling to ask in the first place. Dubai, and the rest of the Middle East, is literally sitting on top of cash, in the form of oil; and the United States, the largest consumer of crude oil in the world (see statistic here) refuses to give up the oil habit. George Bush and all his minions in Congress are wasting time throwing dead money at ethanol, a smokescreen that is doing nothing to reduce America's demand for oil; unfortunately, they are doing very little else. To realistically reduce our dependence on foreign oil, America needs to combine conservation (a political issue congress won't tough with a ten foot pole) and tech that actually works (like solar and wind power, which angers voters in the politically crucial and corn farmer haven, Iowa).
If you don't like a particular retail store, for example, and are sick of their outrageous profitability and damaging expansion, you don't keep shopping at that store or for that product - you look for alternative products and retailers. When it comes to oil, the United States is doing a pretty pathetic job of this.
The problem is that Congress is asking the wrong questions. Its easy to understand why Nasdaq would be willing to Borse Dubai: money. In a capitalist system the almighty dollar trumps everything else - and if Borse Dubai is willing to pay a pretty penny for Nasdaq, then how could the American company say no?
The question that Congress needs to ask is why the government of Dubai has so much cash to begin with? The answer is one that politicians don't like the answer to, which is probably the reason why they're so unwilling to ask in the first place. Dubai, and the rest of the Middle East, is literally sitting on top of cash, in the form of oil; and the United States, the largest consumer of crude oil in the world (see statistic here) refuses to give up the oil habit. George Bush and all his minions in Congress are wasting time throwing dead money at ethanol, a smokescreen that is doing nothing to reduce America's demand for oil; unfortunately, they are doing very little else. To realistically reduce our dependence on foreign oil, America needs to combine conservation (a political issue congress won't tough with a ten foot pole) and tech that actually works (like solar and wind power, which angers voters in the politically crucial and corn farmer haven, Iowa).
If you don't like a particular retail store, for example, and are sick of their outrageous profitability and damaging expansion, you don't keep shopping at that store or for that product - you look for alternative products and retailers. When it comes to oil, the United States is doing a pretty pathetic job of this.
