Biden’s Industrial Policy Gets It Right, Almost

US industrial production is near its all-time high, and spending on factory construction is soaring. It’s an intriguing indication that President Joe Biden’s dreams of a manufacturing renaissance could be more than empty political rhetoric or a cyclical recovery from a pandemic downturn. Certainly the White House sees it as a vindication of its renewed emphasis on industrial policy, as the federal government now offers subsidies for the domestic manufacture of semiconductors, batteries, electric vehicles and other elements of its vision of the high-tech, green economy.

In many ways, the Biden administration is correct. At the same time, its very success means that the White House ought to consider taking its own ideas a bit more seriously, streamlining a policy paradigm that in practice looks more like blanket protectionism than strategic investment.