China’s government-dominated economy has a lot of Washington politicians wanting to imitate Beijing. Typical is Senator Mark Warner (D–VA): “I’ve been impressed with the Chinese model.”
This segment of What’s Ahead exposes the folly of such thinking. The U.S. has consistently been at the forefront of invention and innovation because of our free-market economy. Government-dominated economies ultimately flop at fostering creativity because they can’t foresee the future when it comes to new technologies and their often surprising applications.
The U.S.’ record in playing the government-knows-best game has hardly been stellar, from supersonic airliners to fast-breeder reactors to environmentally harmful corn-based ethanol. Yet the Senate has passed a $250 billion boondoggle bill dubbed The U.S. Innovation and Competition Act.
Among the new bureaucracies this bill will create is one called The Office of Manufacturing and Industrial Innovation Policy to create a National Strategic Plan “to identify short-term, medium-term and long-term needs.”
You can’t make this stuff up.
And the bill allocates $52 billion in direct subsidies for new semiconductor fabrication plants. Already the politicians are dictating where these new facilities must be located.