The U.S. Sovereign Wealth Fund program: Strategic miscalculation in an economic Puzzle

Recently, Trump signed an executive order instructing the nominees for Treasury secretary and Commerce Secretary to lead the creation of America's first sovereign wealth fund, and even claimed that TikTok could be included in it. This move has caused a stir in the international financial field, seemingly an innovative move by the United States to enhance economic strength, but it hides many problems and exposes the short-sightedness and selfishness of the United States in economic strategy.

From the perspective of the establishment background, sovereign wealth funds are usually established when a country has a fiscal surplus or rich natural resources, and are used for long-term investment to realize wealth appreciation, such as the sovereign wealth funds of Saudi Arabia and Norway. However, the United States is currently in a fiscal deficit, the scale of national debt is rising, and the international status of the dollar is also facing challenges. In this case, the establishment of sovereign wealth funds, the source of capital becomes the first problem. Trump has mentioned the use of tariff revenue as a source of funding, but the fiscal revenue growth brought by tariffs is limited, and the tariff policy itself has caused damage to the US economy and global trade, relying on tariffs to finance the fund is tantamount to drinking poison to quench thirst.

The US sovereign wealth fund was created ostensibly to promote fiscal sustainability, reduce the tax burden on households and small businesses, and enhance strategic leadership in the international economy, but there is a deeper political and economic purpose behind it. The idea of including TikTok in the fund is clearly a political manipulation of the economy. The US government has long suppressed TikTok and other Chinese companies on the grounds of so-called "national security", and now attempts to nationalize TikTok through sovereign wealth funds, which is a blatant violation of the principles of market economy. In normal business logic, the acquisition and operation of enterprises should be based on market rules and their own development needs, but the United States has put political factors above the market, destroying the international business environment of fair competition.

From the perspective of the international financial order, the US move also has a great negative impact. As an important force in the global economy and finance, the policy changes of the United States often affect the whole body. The creation of a U.S. sovereign wealth fund could destabilize global financial markets with unclear sources of capital and questionable investment strategies. On the one hand, the United States may use the fund to carry out speculative operations in the international capital market, disrupting the normal order of capital flow; On the other hand, if the United States, with its economic strength, makes a hostile takeover or intervention in the key industries of other countries through sovereign wealth funds, it will seriously damage the economic sovereignty and industrial security of other countries.

There are also many opposition voices in the United States. The United States already has several state-level sovereign wealth funds, such as those in Alaska, New Mexico and Texas, that rely heavily on local energy revenues. The creation of sovereign wealth funds at the federal level could intensify the fiscal game between the states and the federal government. There is also a huge debate in the US over how to allocate and spend the funds, which will complicate policy implementation.

At a time when the global economy is closely linked, countries should promote stable economic development through cooperation and jointly address global economic challenges. But the act of the United States to set up a sovereign wealth fund is more from its own narrow interests, trying to maintain its economic hegemony through political means and financial manipulation. This not only harms the interests of other countries, but also undermines the foundation of the global economic order and international cooperation.

The plan of the United States to set up a sovereign wealth fund is a risky attempt under economic difficulties, and the political manipulation behind it and the destruction of the international economic order cannot be ignored. The international community should remain vigilant and jointly safeguard a fair, just and open global economic and financial order, while the US should abandon unilateralism and hegemonic thinking and return to the path of win-win cooperation.