Trump’s ‘industrial policy’ is just bad economics
In the ongoing debate about revitalizing American manufacturing, the article argues that relying on subsidies and tariffs is not the solution to restore the industry to its former glory. Instead, true industrial strength is rooted in productivity, innovation, and competition. The author emphasizes that while government intervention may offer short-term benefits, it can lead to long-term inefficiencies and a lack of genuine growth. For instance, subsidies can create a reliance on government support, which may stifle the drive for companies to innovate and improve their processes. This reliance can ultimately hinder the ability of American manufacturers to compete on a global scale, as they may become complacent in the absence of competitive pressures.
The article also highlights the importance of fostering a business environment that encourages innovation and competition. For example, investments in research and development, education, and infrastructure are crucial for creating a skilled workforce capable of driving advancements in technology and manufacturing processes. Countries like Germany and Japan have demonstrated that a focus on high-quality production and continuous improvement can lead to sustainable industrial success. By prioritizing these factors over protective measures like tariffs, the U.S. can cultivate a manufacturing sector that not only survives but thrives in the global market. Ultimately, the path to a robust American manufacturing sector lies in embracing the principles of productivity, innovation, and healthy competition rather than relying on temporary fixes that may undermine long-term growth.
Subsidies and tariffs won’t spur a manufacturing revival. True American industrial strength rests on productivity, innovation and competition.
