Germany, which fought longest and hardest against the idea of Europe-wide bank bailouts, immediately criticized Sarkozy's latest idea. But Italy is already mulling legislation to limit investments from foreign state funds, and Spain is actively courting such investments from oil-rich Arab countries.While this sort of political and economic thinking (if one can call it that) may not sit well with such past French luminaries as Claude Frédéric Bastiat or Marquis de Condorcet, it is well in line with most traditional, right and left, French thinking.
Sarkozy, who has never made a secret of his penchant for an activist industrial policy, said that joint action by European state investment funds would protect well-known champions of European industry from falling into the possession of foreign investors.
"I don't want European citizens to wake up in several months' time and find that European companies belong to non-European capital, which bought at the share price's lowest point," Sarkozy told the European Parliament in Strasbourg.
"This might be an opportunity to create our own sovereign wealth funds," he said. "And maybe these national sovereign wealth funds could eventually coordinate to form a business response to the crisis."
The question from our point of view is not dissimilar from the one posed in the previous posting. If the French government wishes to create sovereign funds to prevent its economy from acquiring international investment, that is up to the French taxpayer to mull over. But a European fund involves other taxpayers, namely us. We are already paying through the nose for Supergordon's plans. Do we really want to do the same for Le Chauve-Souris' ideas?
Oh and how does that Spanish idea of courting investments from oil-rich Arab countries fit into this scheme?