Question Brief – 5/7/25

Eric Qian – IX

Should OPEC work with its member countries to establish a bloc-wide sovereign wealth fund to ensure economic stability post-oil?

This question is one of the released questions for the 2025 NIETOC—it’s from round 2 on regional alliances (IX). Upon reading this question, the answer is probably yes. OPEC needs to diversify beyond just oil to ensure economic stability; a bloc-wide sovereign wealth fund helps them with this diversification.

The question also specifies that OPEC is aiming for post-oil economic stability. Consequently, I’ll answer the question by focusing on economic sectors with long-term growth potential.

answer – Yes, because a sovereign wealth fund sets up these countries’ economies for the future, specifically with investments in three key sectors.

1. climate tech
   1. currently, electric vehicles and renewable tech are becoming increasingly cost effective → oil demand is set to peak by 2030, a direct threat to OPEC’s economic stability
   2. therefore, OPEC should establish a bloc-wide sovereign wealth fund that invests in renewable technologies like electric vehicles—these EVs are expected to make up over 80 percent of all vehicles sold by 2030, illustrating that the EV sector has huge growth potential and is something that these OPEC countries should invest in
2. AI
   1. most AI technology currently isn’t innovated in OPEC countries – 6/10 patents for AI come from China, and much of the remaining innovation comes from the United States
   2. but OPEC has to get itself involved in this innovation because AI is the future of the economy—AI market expected to grow 25-fold by 2033; OPEC can invest in areas such as AI research and cloud computing centers, both of which are key to AI’s success and will return major profits
3. physical infrastructure
   1. developing regions (eg. Sub-Saharan Africa, Pacific island nations) looking for infrastructure investment → currently, there’s a 15 trillion dollar global infrastructure funding gap
   2. a sovereign wealth fund is uniquely suited to address this gap for two reasons—first, infrastructure projects often require huge sums of money, necessitating a sovereign wealth fund; second, infrastructure is a uniquely stable investment because so many countries need it → sovereign wealth fund would allow OPEC to fill the gap + profit

Téa Shouldice – DX

Q: Should Congress proceed with Trump’s desired landmark tax-cut bill? 

First thoughts: The only thing I knew with certainty about this bill going into my research was that it involved a continuation of the 2017 Trump tax cuts. Based on that limited information I assumed I would find the most substantive reasoning and evidence for why Congress should not proceed, so I organized my research around that 

Answer: No – the proposed bill would create economic turmoil that Americans can neither figuratively nor literally afford. 

The wording of the question leaves a little room for interpretation – the “should” could be taken to mean “would it be politically beneficial for Congress to proceed?” or “would Republicans controlling the Senate benefit from the bill proceeding?,” but I think the easiest and most relevant way to answer this question is from the perspective of “will Americans at large benefit from the tax-cut bill proceeding?” The introduction would be framed to accommodate this interpretation, and the points are structured around the damage the proposed bill could do. 

1.  National Debt 

1. Trump and his coalition are focused on tax cuts in part because of the supposedly unsustainable size of the national debt, which has now exceeded $36 trillion 
2. The goal for this tax bill is 1.5 trillion dollars worth of tax cuts without alternative sources of income to replace them for the government 
3. This could raise the national deficit by 9 trillion dollars over the next decade, worsening a feedback loop of increased spending to pay interest on debt that eliminates the ability of the government to pay for even bipartisan spending programs  

2. Social Security

1. Social security is supported by over 80% of Democrats and approximately 70% of Republicans; it is one of the few truly bipartisan issues left that both parties can rely on as consistently supported by constituents 
2. Trump’s campaign promises of supposed tax policy changes will implicitly cut the Social Security Administration, resulting in a 21% pay cut in the coming years and reduced benefits 
3. Republicans will lose support because of this change, but even more importantly, the 77% of retirees who cannot pay for necessities without social security benefits will have nowhere else to turn

3. Alternative Spending

1. The Republicans in Congress seem to have reason to push the bill through because a small majority of Republicans favor cutting tax rates on corporations and the wealthy 
2. The tax cut bill isn’t truly a tax cut bill at all – it involves spending on alternative goals the Trump administration has like $45 billion to build new immigration detention facilities and $46.5 billion to expand the border system 
3. This will widen the deficit even more, alienate the supporters of the concept of the bill, and reallocate taxpayer money to immigration-related spending that was never properly messaged by the Trump campaign – there is discontent and financial loss everywhere.