Chinese lose bid on American oil

Today, Unocal (the California-based oil company) accepted a $17 billion bid from Chevron, rejecting a more financially advantageous bid from Cnooc, a Chinese government owned company. The much debated issue, by politicians and economists everywhere, is whether a communist Chinese company should be allowed to own a multibillion dollar American. Since the communist system does not accept the idea of private property (all property is in fact held in common by the state), what does that imply about real assets it would own in the US as a result of a successful bid for Unocal? Tacitus makes a great argument (with historical references) as to why the market must determine this deal and not politics.

The NY Times sums it up nicely:

A Cnooc victory would have brought the largest takeover by a Chinese company of a foreign company and the biggest step so far by one of China's three state-owned oil companies to break out of their country in the search for sources of energy. Chevron, meanwhile, is betting on Unocal's growth potential to help it increase production and add to its global reserves.
As an aside, another Chinese company that was bidding for Maytag has withdrawn today.