By Gal Luft’s own methodology, we’ve got a major problem to our north: Canada’s oil assets stand at $18 trillion, bigger than America’s own GDP. Canada will soon own America. Hmmm.

Let’s put the “buying us up” argument in perspective: Overseas acquisitions from the Arab world in 2007 amounted to a mere $68 billion. Middle-eastern individuals and companies own a total of $8 billion of U.S. direct investment, less than Belgium ($10 billion). Moreover, if they are re-investing “our” money here, that’s actually a pretty good deal for us. Because this increases capital outside the Arab world, it directly increases non-Arab labor productivity and GDP. Because about two-thirds of GDP goes to labor as wages, salaries, and fringe benefits, rising output means higher wages or more employment. Thus, foreign investment raises labor productivity, income, and employment. Workers are better off with more capital than with less and are usually indifferent to the nationality of the investor. In essence, the Arabs are using our petrodollars for our benefit as much as theirs. Foreigners, never mind Arabs, continue to own a negligible amount of U.S. capital, so fears of an “Arab takeover” are overblown.

Mr Luft’s sudden assertion that it is Arabs buying up America that is the problem, not Arabs using U.S. money to promote terrorism, makes me think that the flex-fuel mandate is a solution in search of a problem.