One of the most fundamental disagreements between the Left and Right on economic matters comes down to the question of letting private enterprise build wealth and using government taxes to distribute wealth. The extraordinary float of Facebook and the insolvency of Greece are two of the sharpest examples imaginable.
If Facebook was a 100% Greek-owned concern, there would be no problems with the Greek economy because $US104 billion of instant wealth creation enormously expands the size of any pie.
However, the Greek system would never have generated a Facebook because of its financially incompetent governing record, which features ridiculously generous public pensions, enormous tax evasion and union-run restrictive work practices.
All this would be fine, but for the fact that Greece hasn’t produced any international companies of standing to fund its internal largesse. Tourism, shipping and olive growing only goes so far.
While the $US15 trillion in public debt obligations racked up by successive US federal governments is a major problem, there is so much private US wealth and so many successful US multinationals that these liabilities can easily be serviced and repaid.
Facebook’s IPO was a landmark moment for US corporate exceptionalism. Never before has a privately-owned company floated with a start-up valuation exceeding $US100 billion. The hype on CNBC on Friday night was also something to behold. History may one day laugh at this moment as the peak of another bubble that epitomised the irrationality of markets.
But for now, we need to record the moment and see just where Facebook ranks in the league ladder of multinationals as measured by market capitalisation.
For mine, as long as the US has 23 of the 41 global companies worth more than $US100 billion, it will always remain the pre-eminent global super-power.
Bookmark this page folks, as it is an interesting snapshot of global corporate power. And we’ve included the links to the various Bloomberg pages so you can easily go back and check market capitalisations as they ebb and flow in the years ahead …
Ranking the 41 global companies worth more than $US100 billion: