• The U.S. is embracing a new economic theory of “Buy American” to ensure that the U.S. doesn’t rely on flimsy supply chains for key materials, especially those that pass through our adversaries’ borders.
• This policy can have advantages such as funneling money to domestic businesses in important industries, theoretically raising the wages of workers in those sectors, and letting the government support the development of crucial technology and infrastructure.
• However, Buy American policies can have several downsides such as raising costs, making key supply chains less resilient, hurting innovation, and damaging global alliances.
• The article suggests that the U.S. should be explicit about the trade-offs that come from explicitly protectionist policies and should focus on delivering political and human outcomes such as plentiful, cheap, low-emission electricity produced by more clean-energy infrastructure in an economy with full unemployment and rising real wages.
Published February 8, 2023
Visit The Atlantic to read Derek Thompson’s original post Don’t ‘Buy American’
