Wednesday, August 31, 2011

The First Rule Of Industrial Policy

Is that everyone pretends we don't have industrial policy. Of course in practice we do have industrial policy. We may not have a Council On Industrial Policy, and an explicit plan to implement an Industrial Policy. Instead we spend our days complaining about the evil subsidies that other countries have made to their favored industry in the name of industrial policy. But we have various kinds of industrial policy. Some of it comes from people having a sense of how the world is supposed to work and implementing that as policy. Some of that comes from the various consequences of our ridiculously large military budget. Some of that comes from large incumbent industries having the ear of important senators. Sadly, these days, too much of our industrial policy leans towards industries that don't actually do anything. It's about health insurance and the financial industries, the skimmers and middlemen who do nothing but whose obscene profits must be protected at all costs.