You know that an economic issue has jumped the shark when the New York Times's op-editoraliste Maureen Dowd (MoDo) devotes her Sunday column to it. What's unleashed MoDo's moxie is how Sovereign Wealth Funds (SWFs) -- those government investment funds estimated to control between $2 trillion and $15 trillion -- are buying up chunks of the U.S. banking system.

The problem against which MoDo rails is that thanks to the policies of George W. Bush, the price of oil has quadrupled and the dollar has plummeted -- thus putting the U.S. at the mercy of those Arabian SWFs whose owners he groveled to this week to lower the price of oil. And while W. was grovelling, so were the CEOs of Citigroup Inc. (NYSE: C) and Merrill Lynch & Co. (NYSE: MER) -- seeking capital to shore up their Collateralized Debt Obligation (CDO)-tarnished balance sheets. MoDo is right that with Bush's $2.4 trillion worth of wars and $1.3 trillion worth of tax cuts, the U.S. has gone from being the world's creditor to its debtor.

But another New York Times article sheds more light on the phenomenon of foreign investment in the U.S. -- suggesting that with their $414 billion worth of 2007 purchases in the U.S., foreign investors, including SWFs, spent a record amount of money buying up the U.S. last year -- up 90% from 2006. The Times suggests that this foreign investment comes in different forms -- some of which are beneficial. How so?

• Higher paying jobs. Investment in the American subsidiaries of foreign companies grew to $43.3 billion last year from $39.2 billion. Bush's deputy Treasury secretary, Robert M. Kimmitt, claims five million Americans now work for foreign companies set up in the U.S. and those jobs pay 30% more than similar work at domestic companies. If this is true, I'd say it's a good thing. But given the absence of those Iraqi weapons of mass destruction (WMDs), the Bush administration's credibility is not at peak levels in my mind.
• Most foreign investment comes from relatively 'friendly' countries. Canada still spends the most money buying stakes in American companies -- more than $65 billion in 2007. South Korea's investments totaled $10.4 billion last year, up from just $5.4 million in 2000. But countries at odds with U.S. values are coming on strong -- Russia went to $572 million in 2007 from $60 million in 2000.
• The bank buying SWFs account for $21 billion of 2007's total. At the center of concern is the growing influence of SWFs, which invested $21.5 billion in American companies in 2007. For some reason, the level of outrage about selling U.S. banks to countries like Saudi Arabia -- which accounted for 15 of 19 9/11 hijackers -- is mild compared to the firestorm that resulted from the proposed sale of port manager, DPWorld, to the United Arab Emirates in 2005.

I believe that the U.S. economy is at risk if these foreign investors use the power of their capital to sway U.S. policy in a way that weakens us politically or economically. At this point, it seems to me that the conditions that make those foreign investments possible -- quadrupled oil prices, a 60% lower dollar, and the debt-laden U.S. government and consumer sectors -- are more threatening to our future than the foreign investment itself.

I don't derive comfort from Bush administration assurances that this foreign investment is benign. And I think Americans need to know more about the terms of these SWF investments and how these investors might use the power of their capital to achieve their ends.

Peter Cohan is President of Peter S. Cohan & Associates. He also teaches management at Babson College and edits The Cohan Letter. He owns Citigroup stock and has no financial interest in Merrill Lynch.