Headline USA
Citizens deserve reliable and affordable access to the materials and markets they need to thrive…
In J.K. Rowling’s novel Harry Potter and the Sorcerer’s Stone Professor Albus Dumbledore opines that humans have a knack for choosing precisely those things that are bad for them. The same could be said for United States and European Union leaders’ affection for interventionist industrial policies.
EU and US: increasingly protectionist, pro-subsidy, and anti-trade
There is never a right way to do a wrong thing, and this is particularly true when it comes to governments picking business winners and losers, drowning politically favored companies in taxpayers’ money and claiming they are turbo-charging progress. The US’ Inflation Reduction Act – doling out $369 billion to subsidize electric vehicles, turbines, and battery projects – and the EU Recovery and Resilience Facility – an instrument for providing grants and loans to support reforms and investments in the EU Member States totaling over €700 billion – are the latest examples of this self-destructive tendency.
Both the European and American political appetite for dirigiste industrial policies is rooted in a wrong-headed desire to beat China at its own self-destructive game, buying into the notion that the government has reliable foresight in which technologies and materials to invest in. History has shown that state aid invariably becomes a vehicle to support uncompetitive companies and pour money into politically favored initiatives, rather than support innovation and cutting-edge technologies. Do America and Europe really want to let China shape their economic strategies?
Home | Caravan to Midnight (zutalk.com)
We need your help to keep Caravan to Midnight going,
please consider donating to help keep independent media independent.