Veronique de Rugy in dailyherald:
Proponents of the ongoing push for national industrial policy, whether they come from the left or the right, frequently argue that we need to promote certain sectors or technologies to create a manufacturing boom. This boom, we're told, is necessary to create more high-paying jobs. But I beg to differ. Industrial policy isn't and shouldn't be primarily about creating jobs. Its primary purpose, if it should exist at all, lies elsewhere.
Think about it this way: Government favoritism in the form of subsidies, tariffs and other interventions allocates resources differently than the way resources are allocated by consumers spending their own money. Ordinarily, businesses -- spending their investors' money -- compete for these consumer dollars. Industrial policy rests on the assumption that such market outcomes don't adequately support higher causes such as national security.
Second, the United States doesn't make these decisions in a vacuum. As Scott Foster explains in the Asia Times,"the globalization of production capacity and new technology development is accelerating away from the United States," in part because"Europe, Taiwan, South Korea and Japan want to keep their leading-edge technologies at home."
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