When Industrial Policy is Shaped by Profits and not People

“Industrial policy” is one of those phrases that puts most people to sleep. It reeks of wonkish pie charts and statistical abstracts. But the root of the very human prices paid in our economy can be traced right back to our nation’s “industrial policy.”

 

Simply put, an industrial policy is a set of government decisions that shape the economy and living standards of its citizens. These policies can cover tax, trade, education, infrastructure and a host of regulations that affect product safety and the environment. That is a lot of levers the government can pull to influence an outcome. The question is what outcome do the policy makers want?

 

Our nation’s founding fathers answered that question over two hundred years ago. In 1791 Alexander Hamilton, the first U.S. Secretary of the Treasury recommended an industrial policy to the Congress to build up U.S. manufacturing to compete with Great Britain. He proposed that the government support key industries, invest in infrastructure improvements, impose protective tariffs, create tax incentives and use the government as a consumer through procurement contracts. It was an industrial policy that put the interests of the nation and its people before profits to a few.

 

In the two centuries since Hamilton wrote those words, priories have shifted in Washington. Today, trade policy is driven by corporate lobbyists who try to influence profitable outcomes for their companies. From shaping what we do about the opioid crisis to pushing for corporate tax cuts, lobbyists are often the first in line and often the most influential. And corporations justify it by arguing that if they wealthy get wealthier, everyone benefits. Problem is: “trickle down” doesn’t work.

 

It doesn’t have to be this way. Throughout history, there are many examples of moments where legislators and Presidents put the interests of the nation first. Abraham Lincoln initiated federal support for a nationwide railroad network. Franklin D. Roosevelt’s New Deal set the rules for unions to organize, built up our infrastructure and established Social Security and unemployment insurance. Dwight D. Eisenhower built the U.S. freeway system. Lyndon B. Johnson’s War on Poverty created Medicare and Medicaid and a variety of social programs. Barack Obama and George W. Bush used federal money to rescue the auto and financial industries. It’s not that companies shouldn’t benefit; but their agenda should not be the first consideration in shaping important policy.

 

The first step in solving a problem is to identify it, and this one is a doozy, folks. The government puts its thumb on the scale every day, but it doesn’t do it very often to help regular people. To change that we must demand that our nation move forward with a well-designed industrial policy that puts communities first. That means developing policies on education, infrastructure, tax, trade and regulations through the lens of what it will take to drive our country forward, not how charter schools can profit or construction companies can benefit. It means to push for a broader vision and not just skirmish over individual bills. And the more we talk about this, the louder our voices will become.

2017-10-24T23:47:34+00:00