U.S. may lose millions of high-wage jobs due to protectionist trends

Last year the United States attracted $180 billion in foreign direct investment. This is extremely important since inbound investment creates millions of high-wage, high-skilled American jobs that support our growing standard of living. But protectionist trends could disrupt this.

Photo: U.S. may lose millions of high-wage jobs due to protectionist trends

In 2006, 20 bills were introduced in Congress that, if implemented, would have restricted foreign investment in the United States. What's more, they could have prevented Abu Dhabi Investment Authority's $7.5 billion investment in Citigroup in late November.

The capital infusion by this Sovereign Wealth Fund owned by the United Arab Emirates boosted Citigroup's share value and helped it deal with the subprime mortgage crisis.

The value of Sovereign Wealth Funds -- country-owned funds consisting of financial assets such as stocks, bonds, property and other assets -- is growing at a tremendous rate. In fact, their combined wealth estimated at several trillion dollars could triple over the next decade.

How would the United States benefit by denying itself investments from these funds?

Fear that foreign government-owned entities will seek control of strategically important industries for political gain is a legitimate concern. But thanks to the Committee for Foreign Investment in the United States, foreign investment bids are objectively scrutinized to ensure that America's strategic assets are well protected.

Plus, in July President Bush signed into law the Foreign Investment and National Security Act of 2007. This further strengthens the vetting process of foreign acquisitions that may present security concerns.

Additional laws or outright banning of foreign governments from buying U.S. companies are not necessary and would only create problems.

In 2006 a political firestorm erupted when Dubai Port World, a United Arab Emirates-owned company, acquired several U.S. ports. Upon this news, many members of Congress broke out in a cold sweat, fearful that Dubai Port World would not provide adequate U.S. port security.

It didn't matter that foreign-owned firms already managed the majority of American ports, or that Homeland Security guards these ports. The pressure ultimately resulted in the Dubai firm relinquishing its interests, charlotte.com reports.

As Pravda.Ru previously reported the glowing economic reports are blowing away the middle class. Amid rough retail reports you can still find some gems. Tiffany the luxury jeweler profit rose as sales went up 20% to $ 662.6 million. Other lower end retailer's sales fell across the board. The struggling middle class is feeling the pinch. The uncertain housing market is causing a lot of the financial woes. A snapshot of the landscape, with the entire home for sale signs would give you a picture of the slowdown.

The middle class is surely being kicked while down. The alluring home market has fallen flat for the struggling middle class. The number of Americans without health insurance has risen by 2.2 million. There are a total of 47 million people without this insurance. The poor are still poor and the middle class is struggling to stay middle class. The claim is other sections of the economy are healthy.

Then who and what are the reports referring to? Before 1990 the Forbes 400 had a combined worth of $221 billion combined. By June 2006 they were worth 1.3 trillion. The median household income has held at about $ 44,000. What this means is if the lower to middle class incomes are stagnate while inflation is rising, the healthy economy exists for the rich. There are many ways to make the national economy appear healthy than it is for the average working class family.

Source: agencies