Free Markets

Should the U.S. Government Adopt an Industrial Policy? A Soho Forum Debate

American Compass Executive Director Oren Cass vs. the Cato Institute's Scott Lincicome on whether the U.S. should increase its intervention in the manufacturing industry.

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Oren Cass, who is the former domestic policy director for Mitt Romney's presidential campaign and the founder and executive director of the think tank American Compass, believes that the U.S. government should intervene more aggressively in the manufacturing industry.

Cass participated in a recent Soho Forum virtual debate, held on January 13, 2021, arguing in favor of the proposition:

"To promote prosperity among all income groups, the U.S. government should adopt an industrial policy."

Arguing against Cass: Scott Lincicome, a senior fellow at the Cato Institute. He says that, in the real world, government interference has only hurt manufacturing. The problem with the economic nationalism favored by Cass is that it insulates companies from the discipline of profit and loss. In a free market, businesses learn from their mistakes. When the government is involved, they react by growing bigger as a way to cover for their failures.

It was an Oxford-style debate, and Lincicome prevailed by convincing 14.56 percent of the audience to switch to his side.

The Soho Forum, sponsored by Reason Foundation, is a monthly debate series typically held at the SubCulture Theater in Manhattan's East Village, but which has gone remote during the pandemic.

Narrated by Nick Gillespie. Edited by Regan Taylor, John Osterhoudt, and Ian Keyser.

Photo: Andy Star/Envato Elements.

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  2. “To promote prosperity among all income groups, the U.S. government should adopt an industrial policy.”

    I see we’re debating socialism again.

    1. I think they put “prosperity” where they meant “equality”.

      1. equality is so 2010, it is equity now.

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  4. This could be an interesting debate, but it seems that the basis is flawed.

    There are some interesting historical examples of government’s attempting to promote the growth of manufacturing within their respective country’s that arguably worked out well.

    It would be nice to hear a debate about if there is ANYTHING that can be done to reinvigorate domestic manufacturing– even if that industrial policy is an entirely libertarian one: de-regulating and making it attractive to build factories and hire wage workers to fill those jobs.

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  5. “The problem with the economic nationalism favored by Cass is that it insulates companies from the discipline of profit and loss.”

    Doesn’t unrestricted (or, in practice, poorly controlled) immigration produce the same result? Rather than pursuing innovative efficiencies — and, perhaps, creating better quality jobs in the process for more people, while lowering costs — reliance on readily available cheap labor rewards inefficiencies. Costly inefficiencies can be glossed over with perpetual savings in the cost of labor, leading to artificial growth. Eventually, you end up like China. You become really good at mass producing worthless shit on the back of slave laborers.

  6. Wow, industrial policy. How 20th century.
    Isn’t the answer “of course not”?

  7. How about government takes over the means of production? They are experts at everything, what could go wrong?

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  12. Yes. The policy should simply state that the goobermint won’t butt in.

  13. No!

    “Legal plunder can be committed in an infinite number of ways; hence, there are an infinite number of plans for organizing it: tariffs, protection, bonuses, subsidies, incentives, the progressive income tax, free education, the right to employment, the right to profit, the right to wages, the right to relief, the right to the tools of production, interest free credit, etc., etc. And it the aggregate of all these plans, in respect to what they have in common, legal plunder, that goes under the name of socialism.”
    ~ Frederic Bastiat

    Industrial policy is theft from the future for the past and from individuals for the collective.

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  17. “For those who flirted with parts of the ex-president’s populist message, there is a straightforward line of defense: While Trump obviously failed, real Trumpism was never tried.

    By all means, let us judge each policy idea on its merits and leave no stone unturned. Yet insofar as insanity consists of doing the same thing over and over again while expecting a different result, to seek to perpetuate the GOP’s populism in the wake of the Trump disaster would be positively insane.”

    https://thedispatch.com/p/the-problems-with-populism-go-well

    Something about “…real Trumpism was never tried” reads so very familiar. It joins the perpetual refrains of “real socialism was never tried” and “real communism was never tried” as the collectivists excuse for the inevitable disasters that they cause when mistakenly allowed any power. Populism, like collectivism of any brand, is nothing better than mob power.

    “There have existed, in every age and every country, two distinct orders of men – the lovers of freedom and the devoted advocates of power.”
    ~ Robert Y. Hayne

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  19. “For those who flirted with parts of the ex-president’s populist message, there is a straight line of defence: While Trump obviously failed, real Trumpism was never tried.

    By all means, let us judge each policy idea on its merits and leave no stone unturned. Yet insofar as insanity consists of doing the same thing over and over again while expecting a different result, to seek to perpetuate the GOP’s populism in the wake of the Trump disaster would be positively insane.”

    Something about “…real Trumpism was never tried” reads so very familiar. It joins the perpetual refrains of “real socialism was never tried” and “real communism was never tried” as the collectivists excuse for the inevitable disasters that they cause when mistakenly allowed any power. Populism, like the collectivism of any brand, is nothing better than mob power.

    “There have existed, in every age and every country, two distinct orders of men – the lovers of freedom and the devoted advocates of power.”
    ~ Microphoneglobe

  20. No!

    “Legal plunder can be committed in an infinite number of ways; hence, there are an infinite number of plans for organizing it: tariffs, protection, bonuses, subsidies, incentives, the progressive income tax, free education, the right to employment, the right to profit, the right to wages, the right to relief, the right to the tools of production, interest free credit, etc., etc. And it the aggregate of all these plans, in respect to what they have in common, legal plunder, that goes under the name of socialism.”
    ~ Frederic Bastiat

    Industrial policy is theft from the future for the past and from individuals for the collective.
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