“Industrial policy” is a misleadingly soothing phrase meaning “central planning.” Just because China is making the mistake of pursuing industrial policy, doesn’t imply that U.S. worries about China should lead us to make the same mistake. In fact, their following industrial policy should lead us to worry less.
(p. A4) Lurking just behind the domestic debate breaking out over President Biden’s $2.3 trillion infrastructure plans is a powerful foreign force: China.
. . .
. . . elements of the plan are clearly constructed with an eye toward better competing with China, and in ways generally supported in both parties:
—Providing $50 billion for semiconductor manufacturing and research. This proposal would put oomph and dollars behind a bipartisan initiative Congress pushed into a defense bill late last year, called the CHIPS Act, authorizing research and subsidies to increase domestic manufacturing of semiconductors and lessen dependence on China for the computer chips now essential to all manner of products.
The leaders of the congressional push to help the semiconductor industry include Sen. Tom Cotton of Arkansas, a conservative who agrees with the Biden administration on very little. The current shortage of chips plaguing the American auto industry underscores the arguments for this piece of the package. This is one of several areas where traditional conservative arguments against federal “industrial policy,” in which the government picks specific industries to boost with support from Washington, have fallen by the wayside in the face of Chinese advances.
For the full commentary, see:
(Note: ellipses added.)
(Note: the online version of the commentary has the date April 5, 2021, and has the title “CAPITAL JOURNAL; China Looms Large in Biden Infrastructure Plan.”)