The Economist's Digest 18

Commodities
A petrodollar saved
Originally from Economist.com Sep.4th, 2008

Summary:
Resource-rich countries invest their income from natural resource to sovereign-wealth funds (SWFs) to avoid bad economic circle------spending all the money from their resources and becoming poor again. For example, Government Pension Fund in Norway is established to save the wealth from oil. Moreover, Arabia (S.A.) uses their fund to buy farmland for food demand at home.
However, most of these funds aren’t transparent on their financial conditions, which is a big shortcoming. Then, co-operation may be a good solution, or illiquid (hard to change into $) investments may help, too. Because SWFs is usually used to urgent-government use, it lose its original purpose.
There are two extreme examples, funds in Venezuela and Norway . The former doesn’t know how to collect money properly; while the latter doesn’t know how to use it effectively.
To break the resource curse, in short, one needs the kind of government that money can’t buy.

My opinion:
Well, if we analogize these national stories into personal ones, we can find that “governments” are “people who don’t know how to use money.” Actually, it’s the essence of governmental finance. We can see it clearly from how governments around the world make their budgets. Even if it’s a very good national government, it will still make “some” mistake when making budgets.
Compared to private funds, government funds will be used in inappropriate ways more often because of the bad spending habits of governments. It seems like a credit-bankrupt person. In fact, many governments, including that of developing countries and developed countries, have been credit-bankrupt for many times during many global economic crises. (Yet most of them are developing countries.)
In Taiwan , we aren’t looking forward to our government to use our national funds properly nowadays. Nevertheless, we may look at other countries’ experiences and improve our government a little.