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One Step Toward the Fire Sale is Coming into Focus [1]
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Date: 2025-03-07
On February 3, Trump signed an executive order directing the Treasury Department to develop a plan for establishing a U.S. “sovereign wealth fund”. The EO specified the plan is to be submitted within 90 days, and implemented within the year.
Sovereign wealth funds are typically designed as an investment mechanism for surplus revenues, ostensibly for the benefit of the country. As the U.S. is chronically in debt, the money for such a fund (we are talking billions/trillions) would have to come from somewhere, and quickly, to meet the year- end deadline. Enter the federal (public) assets. As explained in their “Fact Sheet” accompanying the EO —
The United States already holds a vast sum of highly valued assets that can be invested through a sovereign wealth fund for greater long-term wealth generation. The Federal government directly holds $5.7 trillion in assets. Indirectly, including through natural resource reserves, the Federal government holds a far larger sum of asset value.
www.whitehouse.gov/...
On March 3, the administration published
a list of more than 440 federal properties it had identified to close or sell, including the FBI headquarters and the main Department of Justice building, after deeming them “not core to government operations.” Hours later, however, the administration issued a revised list with only 320 entries — none in Washington, D.C. And by Wednesday morning, the list was gone entirely. “Non-core property list (Coming soon)” the page read. www.pbs.org/...
As usual, the roll-out is chaotic, but we can see where they are trying to go.
Who, exactly, would be buying these properties, and at what kind of bargain prices? And where would the proceeds, presumably through the mechanism of the sovereign wealth fund, be invested?
Rachel Wellhausen, a professor of government at UT Austin, said there are many ways to operate a sovereign wealth fund. The sovereign wealth fund operates almost like a venture capital fund, Wellhausen said. For example, an entrepreneur could approach a government to ask for officials to invest in business ideas. This system puts money to work instead of just having it sit in the government treasury. “And it’s the government officials, the political actors, who are making the investment decisions. And different countries run them in different ways,” she said. “Norway has a huge sovereign wealth fund, and they deliberately, politically, choose to invest in green things. They don’t invest in the defense sector, things like that. So you can have different sorts of objectives other than just maximizing returns because it’s a politician, it’s a government, making the choice.” www.texasstandard.org/...
Read some of those lines again —
“an entrepreneur could approach a government to ask for officials to invest in business ideas.”
“And it’s the government officials, the political actors, who are making the investment decisions.”
What could possibly go wrong?
For more on the potential liquidation of public lands for his SWF, see —
www.americanprogress.org/…
And on the irony of the main Justice and FBI buildings deemed “not core to government operations”, see Joyce Vance’s Mar. 6 substack — “Justice for Sale”
joycevance.substack.com/...
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