Oilman T. Boone Pickens has been all over the airwaves lately promoting his “Pickens Plan,” which is pretty cool; he’s putting (some of) his money where his mouth is, trying to effect change in America’s energy policy. What bothers me about his ads, though, is this line: “Projected over the next 10 years the cost will be $10 trillion — it will be the greatest transfer of wealth in the history of mankind.” See, that makes it sound like some sort of welfare program, or income redistribution program - as if America is simply giving the $10 trillion away, or the money is being somehow “transferred” to another entity without our knowledge or agreement.
The truth is, it’s not a “transfer” — it’s an EXCHANGE. An exchange of money in return for goods and services. It’s called capitalism, albeit not exactly “laissez-faire.” We want oil. “They” have oil. We give them money, they give us oil in return.
In other words, it is NOT a wealth transfer - it’s actually millions of transactions, wherein one side pays the other side for something of value. Now, is it entirely a “fair” deal? Possibly not - with so many politicians & nations involved, and taxes and tariffs and such, no one can put an actual cost and benefit tag on the transactions. But the fact remains: it is NOT a transfer of wealth. The $10 trillion represents transactions of money for goods.