Free Trade

The Senate's Industrial Policy Bill Is a Debt-Financed Corporate Giveaway That Lobbyists Love

The U.S. Innovation and Competition Act is a lobbyist-crafted proposal that funnels emergency spending to politically connected special interests.

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Before the end of the week, and possibly as soon as later today, the Senate will vote on a major industrial policy bill that spends $195 billion, with much of it funneled to high-tech manufacturing.

The United States Innovation and Competition Act of 2021 is being widely framed as a bipartisan effort to stand up to China. The New York Times, for example, describes the effort as "powered by rising fears among members of both parties that the United States is losing its edge against China and other authoritarian governments that have invested heavily in developing cutting-edge technologies." Senate Majority Leader Chuck Schumer (D–N.Y), the lead sponsor of the 1,500-page package, ominously tells the Times that "if we don't step up our game right now, we will fall behind the rest of the world."

"That's what this legislation is ultimately about," Schumer adds.

But if you want to know what this legislation is really about, you have to skip down several paragraphs to where the Times notes that the bill's "popularity made it a magnet for industry lobbyists and lawmakers' pet priorities."

Having Congress set industrial policy is good news for businesses with power and influence over federal policymaking, and this proposal is no exception. The bill's 1,500-plus pages—which were reportedly still being finalized even just a day before the package was supposed to go to the Senate floor for a vote—provide ample opportunity for waste and cronyism.

"The bill spends well over $100 billion on special interests and managing the U.S. economy in areas where the private sector has already proven itself effective," writes Walter Lohman, director of the Asian Studies Center at the Heritage Foundation, a conservative think tank.

A huge amount of that spending is flowing to Intel and other microchip-manufacturing firms, despite the fact that there is little indication the industry is in need of $52 billion in government aid. Schumer and the Times are eager to suggest that America is losing its technological lead over China in semiconductor manufacturing, but that's not accurate either. According to the Semiconductor Industry Association, a trade group, American-based firms control 47 percent of the global share of the semiconductor industry—while China controls just 5 percent.

Framing competition with China as a crisis has allows lobbyists to snag some taxpayer cash for their clients, and it also allows Congress to avoid figuring out how to pay for the bill. Instead, the entire package will be financed with public debt.

"The emergency designation for funding the bill is questionable at best," says Maya MacGuineas, executive director of the Committee for a Responsible Federal Budget, which advocates for reducing deficits. "Emergency funding should be for temporary provisions that are necessary, sudden, urgent, and unforeseen—not appropriations that start next fiscal year and will continue five years in the future. Ideally, this funding would be enacted as part of a broader national economic strategy, which should be reflected in a federal budget."

The contradictions here are stunning. Even if it doesn't trigger a debt crisis, nearly record-high levels of debt will likely slow America's future economic growth.

Schumer says the U.S. must "step up our game" or else "fall behind the rest of the world." But the U.S. Innovation and Competition Act is business as usual for a feckless Congress: a lobbyist-crafted proposal that ignores America's increasingly precarious fiscal state to funnel public money to politically connected special interests.

NEXT: The Federal Government Has Spent $46 Billion on Emergency Rental Assistance. The Rollout Has Been a Hot Mess.

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  1. The U.S. Innovation and Competition Act is a lobbyist-crafted proposal that funnels emergency spending to politically connected special interests.

    How is this different from any other act of Congress?

    1. “How is this different from any other act of Congress?”

      Well, the “price tag” is in the billions of dollars, instead of the trillions…..

      1. “….more like the last Act of Henry the Eighth!”

        Monty Pythom

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    2. No catchy acronym?

  2. Continuing the theme that America should remain a consumerist economy with doped up kids.

    1. Consumption is the goal…

  3. That day…
    Threats of Gov-Guns = Wealth
    instead of..
    Value = Wealth.

  4. Crony Socialism strikes AGAIN!!!

    1. GOOD ONE!!

  5. https://www.enbeyazsohbet.net/ Herşeyin Daha Güzel Olması Dileyimle

  6. Promises made, promises kept.

  7. The train hurtling toward a cliff analogy just won’t leave me.

    1. Lemmings.

      The Lead Lemming shouts:

      ” FORWARD!”

      As goes the rest….AHHHHHHH..
      ….

      They forget in their use of the Phoenix analogy that the Phoenix ends up burning its house down while in it!

  8. >>is being widely framed as a bipartisan effort to stand up to China

    lol to what demographic? average four year-old would see through it

    1. “lol to what demographic?”, To the MAGA crowd. Democrats in red states like Joe Manchin need this to tell their voters the Chinese have to stop ” takin our jerrbbs”.

      1. I’m muting your ass just on name alone.

        Likely just a sock for one of the other assholes [I have already muted] who troll these parts any way.

  9. I feel like the word ‘bipartisan’ the past year or so has gone the same way of the word ‘debunked’.

    I just don’t trust that it means what it’s supposed to mean when it comes out of the keyboard of a journalist.

    1. I would trust it from the keyboard of a journalist, if any were left.
      I do not trust it from the keyboard of a propagandist.

    2. With Demo-spenders in charge, its
      Buy- Partisan!

    3. All the Democrats, plus Lisa Murkowski, Susan Collins and/or Mitt Romney=bipartisan.

  10. “I hate communism because central planning doesn’t work.”

    Wrong. It doesn’t work as well.

    “Danger! Danger! The Soviet / Chinese Commie society is improving! Communism is scary! It will overtake us!”

    “Looks like central planning is working! Oh noes! What can we do?!?!?!”

    “Let’s adopt central planning and beat them at their own game!”

    Fucking geniuses. If they actually believed that central planning was less efficient than markets, the only proper conclusion is to free our markets of the central planning that is hobbling them.

    1. It is not about efficiency or what “works;” it is about control. And for those in power, who invariably want more of it, that trumps everything.

    2. it works OK. Dictatorships are efficient!

      the problem is it mutates to corporate and individual planning as everything must be under State control.

      See California for an example. Or whats left of CA…

      1. But if we force the entire country to adopt California’s policies, there won’t be anywhere to escape to…er, I mean, we’ll finally have equity!

        1. We should treat escaping Californians like a creeping plague as other Foriegners. A Wall along the CA border.

    3. In all fairness, China is shifting away from communism. Granted, it’s trending hard toward fascism which is the result of much of their “improvement”.

      1. Yes, China are full of Shift…

  11. A fine example of Libertarianism.

    Left Democrats advocate personal welfare.

    Libertarian policy advocates large Govt funded infrastructure spending larks such as piping water across the country. That came frim the Lib. official platform documents I bought from them so dont any if you Lying Trolls try to play ” no it isnt”

      1. ” Theres always one, isnt there?”

        John Cleese, Monty Pythons Flying Circus

    1. Official documents you “bought from them”? How much did you pay?

      Oh, you paid way too much.

      1. Yes I did. They were out in a booth begging for contributions so I foolishly slipped them A C note for their books. Two mistakes. Then it was near impossible to get rid of them…

        1. Wow. That sounds crazy.

  12. I mean, that’s what the definition of ‘industrial policy’s is.

    Don’t attack it because it’s full of pork – attack it because all it can ever be is giveaways to cronies.

  13. If we want to kneecap China why doesn’t the Gov stop giving them access to us research and tech, arrest every person in the thousand tallents program as the spies they are, and have a 100% revenue tax on all business dealings with the CCP. Sure Google would loose a butt ton of money from maintaining the social credit system.

    1. We must stop subsidising their hi tech industries such as semiconductors. We gave them the bloody capacity.
      Surely we can build semi plants in Communist shit hole places over run with violence and poverty like….California…NY..Shitcago…

  14. Not only is this much pork Kosher, it’s also Halal. We know who will vote for it in the House.

  15. This is close to happening

    1. Aaaand 60

  16. Fund those MEP’s – bipartisan pork.

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