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I'm happy to report that we made substantial progress between the United States and China in the very important trade talks. First, I want to thank our Swiss host. The Swiss government has been very kind in providing us this wonderful venue, and I think that led to a great deal of productivity we’ve seen.

"We will be giving details tomorrow, but I can tell you that the talks were productive. We had the vice premier, two vice ministers, who were integrally involved, Ambassador Jamieson, and myself. And I spoke to President Trump, as did Ambassador Jamieson, last night, and he is fully informed of what is going on. So, there will be a complete briefing tomorrow morning.”

That’s from Bessent. We’ll see about it tomorrow.

One thing’s certain:

This board will claim that Trump caved on all points no matter what deal was struck.

Trump will claim victory no matter what deal was struck.

The truth is in the middle somewhere.

This board will claim that Trump caved on all points no matter what deal was struck.

That's what the Houti's say too.

This board will claim that Trump caved on all points no matter what deal was struck.

Trump will claim victory no matter what deal was struck.

The truth is in the middle somewhere.

And it ended up being....none of those things.

The result of the meeting was only a temporary suspension of the embargo-level tariffs that both sides imposed recently. Nothing was decided that affected any aspect of the U.S.-China trade relationship as it existed before those tariffs, and nothing permanent, so neither side really gave or gained anything of consequence.

The only real "winner" and "loser" are Bessent and Lutnick, respectively. It's now pretty clear that Bessent is driving trade policy, rather than Lutnick, and even a temporary suspension of the massive tariff levels indicates that a full "decoupling" of the U.S. and China is probably not a strategic goal of the Administration.

So we currently have:
1. The US will lower the rate at which it taxes Americans who buy stuff from China, to 30%.
2. China will lower the rate at which it taxes Chinese folks who buy stuff from the US, to 10%.
Our macroeconomic prospects are better today than they were last week but much worse today than on Inauguration day.

So far we have two "deals":
1. Americans will pay a 10% tax on stuff they buy from the UK .
2. Americans will pay a 30% tax on stuff they buy from China.

Of course this is the opposite of what was promised, "When I win, I will immediately bring prices down, starting on Day 1!" ~Trump

Lastly, before getting excited about the China "deal," remember the UK "deal"...
which literally says, "Both the United States and the United Kingdom recognize that this document does not constitute a legally binding agreement."

https://www.reuters.com/world/china/us-china-reach...

https://www.npr.org/2025/05/12/nx-s1-5395027/us-ch...

https://bsky.app/profile/justinwolfers.bsky.social...

very regressive taxastion. will hit lowest economic level hardest... why is this not being talked about ? I watch numerous talking head programs and they really dont home in on this aspect... as a consuming economy with a high percentage living paycheck to paycheck, consumption will likely also drop dramatically.... where is the "joined up thinking in this "government"....or am I asking too much ?

and even a temporary suspension of the massive tariff levels indicates that a full "decoupling" of the U.S. and China is probably not a strategic goal of the Administration.

China is down to 10% and the US is down to 30%. They also made progress on fentanyl.

Bessent also pretty much says the opposite of what you wrote.

am pretty sure other countries will just monitor what level tariff is actually being enforced.
they would be fools to rely on the value of any legally binding contract produced by anyone associated with trump. his own rework of nafta from trump 1.0 was dumped in the goal of getting more for himself this round.

throughout trump's life, contracts are something to be tested in court via subsidized legal costs, and possibly even ignored after the ruling.

China is down to 10% and the US is down to 30%. They also made progress on fentanyl.

Both tariff levels are higher than before the trade war started, and almost every other aspect of prior trade policy remains intact. No changes have been made to anything that existed before the trade war, for the most part (I haven't seen what substantive changes on fentanyl may have occurred over the weekend discussions. Basically both sides called a major ceasefire in the current hostilities, but no material changes have been made to the prior status quo.

Bessent also pretty much says the opposite of what you wrote.

“The consensus from both delegations is that neither side wanted a decoupling,” Treasury Secretary Scott Bessent, who was a point person in the U.S.-China talks in Geneva over the weekend, said on Monday.

https://archive.ph/90uIf#selection-755.0-757.126

That's a major repudiation of the Navarro/Lutnick view of the China strategy.

2. This wasn’t a case of both sides backing down. China only imposed its tariffs as a response to Trump’s gambit, and has reduced them only because he retreated. And retreat he did. This was basically Trump running away from the killer rabbit.

Krugman

Basically both sides called a major ceasefire in the current hostilities, but no material changes have been made to the prior status quo.

Yes. They've agreed to talk.

“The consensus from both delegations is that neither side wanted a decoupling,” Treasury Secretary Scott Bessent, who was a point person in the U.S.-China talks in Geneva over the weekend, said on Monday.

You clipped off the first part of his quote. Here's the rest of it:

https://x.com/RapidResponse47/status/1921874069781...

I would say one of the big takeaways from this weekend — the United States will continue a strategic rebalancing in many areas that were exposed as supply chain weaknesses during COVID, whether it's medicines, whether it's semiconductors, steel... We will continue moving toward U.S. independence or reliable supplies from allies on those — but the consensus from both delegations this weekend is neither side wants a decoupling."

Nobody says 'don't trade with China'. But relying on them for basic necessitates and/or strategic goods is madness.

Bessent said more than that, btw.
https://x.com/EricLDaugh/status/192190145106171522...

The Chinese delegation basically told us that once President Biden came into office, they just ignored their obligations."

"We had an excellent trade agreement with China and the Biden administration chose not to enforce it."

If Joe Biden's people wanted to hurt the country, I'm not sure what more they could have done.

LOL. See the 2nd post in the thread.

Krugman...didn't nail it.

Nobody says 'don't trade with China'. But relying on them for basic necessitates and/or strategic goods is madness.

But that rules out decoupling. If we're going to keep having very large bilateral trade flows with China, we're not heading in the direction that Navarro and Lutnick wanted. And even then, nothing has been agreed to (even in principle) that would change the nature or degree that we rely on them for basic necessities and/or strategic goods.

The Chinese delegation basically told us that once President Biden came into office, they just ignored their obligations."

It's hard to see how that's true. China was "ignoring their obligations" on the most important part of the Phase One agreement, the increase in U.S. exports, the moment the deal was cut - they didn't increase imports by the required amount when Trump was in office, either. American companies were never in a position to provide the increased exports that the deal called for even when it was agreed to - in no small part because the retaliatory tariffs that China had imposed during the 2017-2019 trade war ended up decimating U.S. export capacity to China in critical sectors (especially automobiles) and giving massive space for China to strengthen their domestic markets. So China ended up agreeing to provide "access" to their markets that U.S. firms were utterly incapable of utilizing. And of course, COVID ended up wrecking the best-laid plans of mice and men anyway - so the two-year window that Trump negotiated for ended up being of little value (and not worth the damage caused by the prior trade war):

https://www.piie.com/blogs/realtime-economics/2022...

Since the increase in U.S. exports was only a commitment for two years, and half of it was during Trump's administration, it's really hard to lay that failure mostly on Biden. Much of the rest of Phase One was complied with by China - they adopted the delineated IP legislation, and they did increase access for U.S. financial services firms. It was the import levels that were the major failure, but that was (again) due mostly to what Trump did and not Biden.

Now, I have no doubt that Chinese officials told Bessent that it was all Biden's fault, because that's something that would make Trump happy. And that's the party line that the GOP has been promoting to defend what ended up being a strategically disastrous trade policy. But the truth is that the failures of the agreement were mostly because of flaws in what Trump did, not lack of "enforcement" in the first year of the Biden Administration.

But that rules out decoupling.

I'd rather not quibble over the meaning of the word 'is', as they say. It's clear the United States should move to a place where it makes the strategic things it needs in a location either inside the United States or within a friendly country. How about that?

Your article is conflating a lot of events.
US aircraft sales plummeted in 2019, following crashes of Boeing's airplanes.

Boeing's issues and the subsequent restriction of plane production, labor strife and general black eyes had a ton to do with this.

The reasoning here
The Biden administration was not to blame, as China was never on pace to meet its purchase commitments (figure 2). Trump's deal was agreed on December 13, 2019 and signed on January 15, 2020. By the end of June 2020, China's purchases were at only 55 percent of the pro-rated target; they reached 59 percent of the year-end commitment for 2020. China was never able to catch up, as the agreement was back-loaded, with additional purchase commitments for 2021 that were more than 60 percent higher than 2020.

Was there something happening that might have affected global purchasing in 2020?

But the truth is that the failures of the agreement were mostly because of flaws in what Trump did, not lack of "enforcement" in the first year of the Biden Administration.

I'd say COVID had more to do with it, but whatever.
The broader point still stands - we were doing nothing to lessen our dependence on China for critical things. Do you really want to sole source our PPE from them?

I'd say COVID had more to do with it, but whatever.

If you like. Either way, it's not the result of Biden's Administration failing to enforce, but because of other factors that made it all-but-impossible for U.S. exporters to actually take advantage of that two-year window. Whether because of the damage inflicted to U.S. exporters over the previous two years of the trade war, the unexpected occurrence of COVID, or the poorly structured deal that only resulted in a two year commitment in the first place: the seeds of failure were planted long before Biden was elected.

The broader point still stands - we were doing nothing to lessen our dependence on China for critical things.

Do you not recall the CHIPS Act? The local preference requirements of the Inflation Reduction Act that were interwoven into that industrial policy? There are smart ways to go about a targeted lessening of dependence on China for critical things - including but not limited to broadening our import sources to other low-cost producers to diversify our sourcing. Here's an idea: we could enter into trade agreements and mutually beneficial open-market trading arrangements with other counties in Southeast Asia that would both diversity our sourcing and help check Chinese regional hegemony. We could call it a trans-Pacific partnership, for example. Or we could use industrial policy to encourage domestic production of critical industries regardless of whether that's the free market outcome - although that would involve the government "picking winners and losers."

Either way, it's not the result of Biden's Administration failing to enforce, but because of other factors that made it all-but-impossible for U.S. exporters to actually take advantage of that two-year window. Whether because of the damage inflicted to U.S. exporters over the previous two years of the trade war, the unexpected occurrence of COVID, or the poorly structured deal that only resulted in a two year commitment in the first place: the seeds of failure were planted long before Biden was elected.

Many things can be true. I'm sure there's at least one in all the multiverse where Biden was a competent, non-senile President but that's not our particular multiverse.

?Do you not recall the CHIPS Act?

We don't buy advanced semiconductors from China.

The CHIPS act is indirectly aimed at China. Its real purpose is to incentivize TSMC (Taiwan Semiconductor Manufacturing Corporation) and Samsung to invest here in the US in the event of a Chinese incursion into Taiwan such that global chip production isn't catastrophically cut off. It's also a lifeline to Intel, who in 5 years or so will be "US SMC" or some such.

There are smart ways to go about a targeted lessening of dependence on China for critical things - including but not limited to broadening our import sources to other low-cost producers to diversify our sourcing.

So how many subsidies do you want to hand out to other industries? BTW China supplies the rare earth elements used in most chips:

https://www.onlinescientificresearch.com/articles/...

The semiconductor industry is highly dependent on rare earth elements (REEs) due to their unique properties that enhance the performance of semiconductor devices. REEs, including lanthanides, yttrium, and scandium, are essential in various processes, from producing powerful magnets to improving display technologies and gas sensing capabilities. However, the global supply of REEs is heavily concentrated in China, which accounts for over 90% of production. This concentration poses significant risks for the U.S. semiconductor industry, which relies on imports from China for critical materials. Despite efforts to diversify sources and develop domestic capabilities, the U.S. remains vulnerable due to a lack of processing infrastructure and environmental challenges. This paper explores the current state of the global REE supply chain, focusing on the U.S.’s dependency on foreign imports. Through scenario planning and strategic recommendations, the study offers insights into how the U.S. can strengthen its domestic supply chain and reduce its reliance on foreign REEs, thereby enhancing its competitiveness in the global semiconductor market.

The US needs to be working with the Aussies and others to stand up rare earth processing plants as well as increasing responsibly sourced ores.

Here's an idea: we could enter into trade agreements and mutually beneficial open-market trading arrangements with other counties in Southeast Asia that would both diversity our sourcing and help check Chinese regional hegemony. We could call it a trans-Pacific partnership, for example. Or we could use industrial policy to encourage domestic production of critical industries regardless of whether that's the free market outcome - although that would involve the government "picking winners and losers."

There's a problem with endless subsidies: the companies that get them tend to end up relying on them. Not a long term marker for success.

I didn't mind the CHIPs act as a 1-time thing but industrial subsidies as lasting policy are not the way to go. What the article mentions

The U.S. Geological Survey (USGS) data reveals that while the U.S. has significant REE deposits, the lack of domestic processing facilities
limits the country’s ability to leverage these resources. This dependency on foreign imports, particularly from China, creates
a bottleneck in the U.S. semiconductor supply chain.

Scenario planning for trade with REE-rich countries demonstrates the potential benefits of diversifying supply sources. Strategic
partnerships with countries like Australia and Japan, which have significant REE reserves and advanced recycling technologies,
could reduce the U.S.’s reliance on Chinese imports. Economic modeling suggests that bilateral agreements and supply chain
diversification efforts would enhance the security of REE supplies, mitigating the risks associated with single-source dependency.

...is a start.

There's a problem with endless subsidies: the companies that get them tend to end up relying on them. Not a long term marker for success.

Seems to have worked for China, right? That's one of our major complaints about their economy - that they engage in industrial policy by providing state-run advantages to domestic producers, which give them a lasting (nigh permanent) advantage in certain industries?

The real difficulty on these issues - at least for traditional Republicans - is that what you're trying to achieve is a deviation from the free market outcome. If you believe that nearly all of the decisions in our economy should be left to individuals and firms and what they think is best for them, it's not surprising you can end up in a situation where one (or several) important products get sole-sourced from an overseas market. Stopping that from happening requires a lot of government intervention in the market.

It's unlikely that simply targeting a few strategically important goods for government intervention will work, though. Many (most?) of these goods require an ecosystem of manufacturing, transportation, energy, and labor resources that is difficult to stand up for just the handful of goods that we deem really important. Which is why tariffs are so unlikely to be a useful tool in this regard - either you set them high enough and broad enough that they end up causing massive disruptions, or they don't work.

As an example, you asked whether I wanted the U.S. to get nearly all of its PPE. The answer is, "maybe" - because it depends on what the alternative is. While there would be certainly some advantages to the U.S. producing all of its own PPE, the degree of government intervention and inefficiency necessary to get to the point where that happened as an ordinary part of the market might be vastly worse than the downsides to the status quo. Similarly, a narrower intervention - say, a whopping big tariff on just imported PPE - might also not be worth the cost; it might prompt domestic production of PPE, but if all PPE all the time in the U.S. is a lot more expensive, it might also be worse than the status quo. PPE was generally easy to source and inexpensive for most circumstances, but rare and hard to source during the pandemic - but if the alternative to that is for PPE to be expensive and somewhat hard to source all the time in order to protect against a pandemic shock, it still my be preferable to stick with the status quo and just be better about stockpiling.

There are trade-offs to trying to sever our reliance on China. It would require a much larger role by the federal government in the economy, require much more cooperation with other countries as partners (and they all have their own interests and goals), and require losing some of the security benefits that come from an engaged China. (Don't forget that one of the big motivations behind admitting China to the global economy was to make it less likely that they would engage in military adventures as a way of seeking power and influence, but instead they would have incentives to try to advance their interests in the economic sphere. If you integrate China into the global economy, they'll have a stake in the global economy and be more loathe to do things that would disrupt their position in the global economy.) Trump, in his folly, believes that tariffs are like a magic wand that can accomplish any goal, any time, all at once - but pushing China out of its spot will require a lot more than that.

"Trump, in his folly, believes that tariffs are like a magic wand that can accomplish any goal, any time, all at once - but pushing China out of its spot will require a lot more than that."

My biggest beef with Trump and his tariff "policies" is that it's like he put no thought into it, lol. It's like he still hasn't asked himself: "ok, if we do away with all Chinese imports, how long will it take America to start making all of that stuff domestically ? " If he had shown some foresight, he might have thought about ramping this up over a few years, minimum.

But no, Trump thinks he can bully foreign nations ( not just China ) like he bullies Mom and Pop
contractors and laborers who do work for him, and then find out Trump is gonna pay them
pennies on the dollar, and whatcha gonna do about it ?

Trump does not believe in contractual obligations, there are a million examples of that.
Trump will break trade pacts that he initiated !!

So other nations will play with him, but they almost certainly are 100% certain that any
agreement signed with Trump is virtually worthless. They are almost certainly going to take
steps to make sure they are not reliant on Trump and America. Trump has done some real
damage.

And this is still just the start. I expect PLENTY more stupid stuff coming from the Trump admin over the next 3 years and 8 months. Going to enjoy watching the magic of the Big Beautiful Bill unfold. Trump has made so many promises that he and MAGA cannot possibly keep, to Americans.
And yeah, I know he'll just lie or deny all of it, it's worked for him so far, lol.

Dope: The Chinese delegation basically told us that once President Biden came into office, they just ignored their obligations."

Of course! It's Biden's fault! Except that it isn't. But, Dope, you listen to shit sources of 'news', so you bring bullshit to discussions.

Seems to have worked for China, right? That's one of our major complaints about their economy - that they engage in industrial policy by providing state-run advantages to domestic producers, which give them a lasting (nigh permanent) advantage in certain industries?


And what fueled that? Their export surpluses fund it. In other words, we're paying for it.

It's unlikely that simply targeting a few strategically important goods for government intervention will work, though. Many (most?) of these goods require an ecosystem of manufacturing, transportation, energy, and labor resources that is difficult to stand up for just the handful of goods that we deem really important. Which is why tariffs are so unlikely to be a useful tool in this regard - either you set them high enough and broad enough that they end up causing massive disruptions, or they don't work.

Actually this applies to subsidies as well. Unless you're willing to write checks for

Rare earth and silicon mining
Rare earth processing
Semiconductor fab
Semiconductor packaging/test
...and more things, then you're not hitting the end-to-end flow in making advanced SOCs. The CHIPs act was only 1 of those things.

As an example, you asked whether I wanted the U.S. to get nearly all of its PPE. The answer is, "maybe" - because it depends on what the alternative is. While there would be certainly some advantages to the U.S. producing all of its own PPE, the degree of government intervention and inefficiency necessary to get to the point where that happened as an ordinary part of the market might be vastly worse than the downsides to the status quo. Similarly, a narrower intervention - say, a whopping big tariff on just imported PPE - might also not be worth the cost; it might prompt domestic production of PPE, but if all PPE all the time in the U.S. is a lot more expensive.

That's the strategic trade off: How much are we willing to pay as an extra holding/development cost for the security of having Thing X or Y around in sufficient quantities to ride out a shock? There are plenty of examples of this already:

-Strategic petroleum reserve
-National Defense Stockpile
-Strategic National Stockpile

The National Defense Stockpile is currently in sorry shape:
https://www.gatestoneinstitute.org/18789/us-strate...
The National Defense Stockpile was established during World War II to ensure that the US military had critical materials necessary for its national defense, including titanium, tungsten, aluminum, and cobalt, especially in the event of a supply chain disruption. The stockpile is managed by the Defense Logistics Agency. According to Defense News:

"The stockpile was valued at nearly $42 billion in today's dollars at its peak during the beginning of the Cold War in 1952. That value has plummeted to $888 million as of last year following decades of congressionally authorized sell-offs to private sector customers. Lawmakers anticipate the stockpile will become insolvent by FY25."

You might ask, "That's fine and all to have a stockpile. But why couldn't we just buy this stuff from somebody else?" Reasonable question, until you consider that the SPR is something we can refill ourselves easily (we pump plenty of oil nowadays). But it would be one thing if say, Mexico was the supplier for medicines and Brazil was the source for titanium, etc. Instead we import the stuff we need from the very outfit we're the most likely to be pointing guns at sometime in the near future.

Sun Tzu would generally frown on handing over your weaknesses to your enemies, don't you think?

There are trade-offs to trying to sever our reliance on China.

We shouldn't sever all trade with China. Let them make non-critical stuff. We, however, need the ability to source certain critical items domestically. One nice thing about being the United States and the system we have is that loads of folks sit around trying to how to make stuff in new fangled ways. We can now 3-D print parts for rockets, and that means we can make loads more things with additive manufacturing techniques more flexibly than we could in years' past.

But none of it means anything if those 3D printers don't have the raw material to print stuff with. Similarly the next time the Chinese screw up and let a superbug out of the lab it wouldn't do to run out of PPE again.

Sun Tzu would generally frown on handing over your weaknesses to your enemies, don't you think?

Sure. But that statement runs both ways, doesn't it?

China and the rest of the world (ROW) are now mutually dependent. Just like us, China relies on imports for key sectors of their economies - sectors that they are not self-sufficient in. This includes agriculture, energy (they run huge imports of all fossil fuels), and most very advanced technology.

For example, China has gone from being a net oil exporter in the early 1990's to becoming the worlds largest oil importer at about 11 million bpd. Today, the Oil Weapon is pointed squarely at China instead of the U.S. The same is true of food - China's the largest importer of food, and depends on imports for approximately roughly 1/3 of its food supply. Which is good! It makes them far less likely to engage in activities that would blow up the world economy! The consequence of that is that China has also handed over its weaknesses to their enemies.

That was one of the key strategic reason why China was admitted to the WTO and integrated into the global economy - to reduce the chances that we would be likely to be pointing guns at them in the near future.

We, however, need the ability to source certain critical items domestically. One nice thing about being the United States and the system we have is that loads of folks sit around trying to how to make stuff in new fangled ways.

Those two things are not unrelated. As I mentioned in the last post, you can't source "critical items" domestically unless you're willing to make enormous sacrifices in pursuit of that goal. You would need to authorize the federal government to play a much larger role in dictating the economy than it does today. And you would need to divert massive amounts of resources away from more advanced technology and products and into making far simpler stuff.

A big part of the reason why we have loads of folks sitting around trying to make 3-D printed rocket parts is because we don't have loads of folks sitting around trying to make t-shirts and tennis shoes in a country where textile laborers earn more than $20 per hour.

If we were to take seriously a desire for the U.S. to become more self-sufficient sourcing those certain "critical items" domestically, you would see a vastly different economic policy being implemented by the government. Not just different from what the Democrats have done in the past - different from what the GOP and DJT want to do, also. You'd need a federal government that was robustly enough controlling the domestic economy to divert massive amounts of capital investment from where it is most profitable into what is less profitable but provides a public benefit. But that type of system looks far closer to what Bernie Sanders has in mind than either Trump or the moderate wing of the Democratic party...so I don't take seriously any suggestion that it's in the cards any time soon.

China and the rest of the world (ROW) are now mutually dependent. Just like us, China relies on imports for key sectors of their economies - sectors that they are not self-sufficient in. This includes agriculture, energy (they run huge imports of all fossil fuels), and most very advanced technology.

That's right. They're buying oil and gas from...drum roll...other not-so-nice entities like Iran and Russia.

Which is good! It makes them far less likely to engage in activities that would blow up the world economy! The consequence of that is that China has also handed over its weaknesses to their enemies.

Uhhhh...does the CCP have anything in its history that would suggest to you that they wouldn't hesitate in starving large numbers of their citizens?

They're not dependent on partners who share our values. Let's put it that way.

That was one of the key strategic reason why China was admitted to the WTO and integrated into the global economy - to reduce the chances that we would be likely to be pointing guns at them in the near future.

And how did that work out? We've literally been feeding the dragon with money for 30 years or so now.

You would need to authorize the federal government to play a much larger role in dictating the economy than it does today.

Or...you provide incentives to source things domestically, which is...what the tariffs are about.

And the mineral deal with the Ukraine, btw.

A big part of the reason why we have loads of folks sitting around trying to make 3-D printed rocket parts is because we don't have loads of folks sitting around trying to make t-shirts and tennis shoes in a country where textile laborers earn more than $20 per hour.

It's a bit more complicated than that. Somebody who works in a textile mill isn't going to go down the street and suddenly invent a new manufacturing process.

You'd need a federal government that was robustly enough controlling the domestic economy to divert massive amounts of capital investment from where it is most profitable into what is less profitable but provides a public benefit.

Interesting...because this is what the CHIPs Act and the "Inflation Reduction Act" were all about. So were those bad things?

And how did that work out? We've literally been feeding the dragon with money for 30 years or so now.

It's worked out pretty well, actually. As I pointed out, China's economy has become deeply dependent on its trade with the rest of the world. Which in no small part has contributed to China almost entirely refraining from military belligerence over the last 30-35 years. Unlike most of our other national security threats over the decades (Iraq, Iran, Libya, Russia, Afghanistan, etc. - to say nothing of various failed states and internal conflicts like Bosnia-Herzegovina), China has remained domestically stable and engaged in almost no direct military conflicts. Exactly what you want in a major military and nuclear power - to avoid military adventuring and compete economically and diplomatically.

Meanwhile, like most national governments, the Chinese federal government maintains a sizable debt - about $13 trillion (or 74% of GDP) officially on the books. Estimates are that they've got another $6 trillion off the books, which would put their debt load very close to that of the U.S. The dragon is not especially well-fed.

Or...you provide incentives to source things domestically, which is...what the tariffs are about.

And the mineral deal with the Ukraine, btw.

Neither of which is at all large enough to be fit for purpose. Oh, sure, the 145% tariffs on China and the 40-50% for nearly everyone else in the world would have had a major impact, but that's not what we're actually going to do, since it would impoverish us immensely. Tariffs aren't going to drive the free market bring back the type of manufacturing sufficient to make us self-sufficient in "critical goods" like you are advocating. To do that, you need to get closer to the state-run centrally-planned economy of China. "Capitalism with Sanders characteristics" - a dominating industrial policy that can force the reallocation of capital in this U.S. into industries and fields that there is no market reason to invest in.

The Ukraine mineral deal is a nothingburger - at least strategically. There's a reason why the Ukraine had a relatively modest mining and minerals industry before the Russian invasion - it's got some reserves, but the country isn't especially well-suited for them to be extracted, processed, and transported. The Ukraine deal just means that the U.S. will get it's beak wetter if that extraction and processing ever starts picking up again, but we always could have invested in Ukraine at arms-length terms for those minerals to get brought to market.

It's a bit more complicated than that. Somebody who works in a textile mill isn't going to go down the street and suddenly invent a new manufacturing process.

Not the line workers, no - but that's looking at the wrong population at the wrong level. There's a limited number of people in the U.S. who are in the business of working on new manufacturing processes and other projects that require very advanced and capable design skills. If you're trying to bring textiles back to the U.S., you're going to need some of those people to go into that industry in order to come up with a way to make textile manufacturing work with $20 per hour labor. That's going to be a fiendishly difficult and complicated task, and it will take a lot of good minds working very hard to make it happen. We'd be much better off if those very good minds are working on solving other problems, rather than trying to get apparel plants to make sense in the U.S.

Interesting...because this is what the CHIPs Act and the "Inflation Reduction Act" were all about. So were those bad things?

Not if trying to reshore certain industrial operations to the U.S. is a goal, no. But that's the point - the GOP heavily criticized both the CHIPs Act and the IRA, because it that type of industrial policy is anathema to the (sizable) free market wing of the party. And you'd have to 10x or 100x those measures in order to get close to the scale of government intervention in the economy necessary to get private parties to start reallocating their capital into building the type of manufacturing clusters you see in China. You can't replicate - or compete with - something like Shenzhen with just some tariffs or modest tax incentives. You would need the federal government replicating something like the New Deal level of stepping in. And there's no appetite in the GOP, even among the China hawks, for anything like that.

It's worked out pretty well, actually.

Sure. If you're China. They're now the #2 economy in the world, have built the world's biggest Navy and are openly throwing their muscle around the globe in such a way as to destabilize it.

As I pointed out, China's economy has become deeply dependent on its trade with the rest of the world.

For some things. Your original stance was that China could ride out a Trade War with the US, btw.

Which in no small part has contributed to China almost entirely refraining from military belligerence over the last 30-35 years.

Because they've spent all that time modernizing their military. Ask Lambo/Lapsody how much they like China's aggression in the Spratly Islands and in the South China sea. Ask Taiwan and Australia how much they like being surrounded by aggressive PLAN and Chinese Air Force elements harassing their militaries and intimidating their governments.

Tariffs aren't going to drive the free market bring back the type of manufacturing sufficient to make us self-sufficient in "critical goods" like you are advocating. To do that, you need to get closer to the state-run centrally-planned economy of China. "Capitalism with Sanders characteristics" - a dominating industrial policy that can force the reallocation of capital in this U.S. into industries and fields that there is no market reason to invest in.

I'm not sure what you're arguing here. Upthread you touted the CHIPs Act and the Inflation Reduction Act but here you're saying that massive government intervention is a bad thing. BTW the reallocation of capital in this U.S. into industries and fields that there is no market reason to invest in is exactly what every single green initiative the west has engaged in has been doing.

But that's the point - the GOP heavily criticized both the CHIPs Act and the IRA, because it that type of industrial policy is anathema to the (sizable) free market wing of the party. And you'd have to 10x or 100x those measures in order to get close to the scale of government intervention in the economy necessary to get private parties to start reallocating their capital into building the type of manufacturing clusters you see in China.

You're making some leaps here. Nobody is saying 'go replace Russia/China's titanium industry' via tariffs. What's being said is "find a way to buy and make stuff we need to buy and make from nicer guys that this".

bullshit to discussions

The bulls strongly disapprove of his use of their shit.

world's biggest Navy and are openly throwing their muscle around the globe in such a way as to destabilize it.

Not around the globe, SE Asia and Australia. The string of pearls hasn't been hardened yet. So are you thinking their navy has destabilized Europe, Africa, the Americas, Russia, etc.?

Not around the globe,

Yea around the globe. They don’t have to have their Coast Guard shoot water hoses or ram supply boats to stir up stuff.

No, Dope, read on both sides and give sources a hard edged test.
https://moderndiplomacy.eu/2025/01/04/chinas-big-b...

The Establishment, made us dependent to now there is no choice.

The Establishment wanted this for decades. Those of us who were against it were labeled and called names.

Now, the Establishment has won.

The only good part is the growing number of unsatisfied, insolvent hoards of people holding back progress in many things and causing mayhem daily.


But I do admit, the Establishment and Google Jockey won this multi decade project.

Your original stance was that China could ride out a Trade War with the US, btw.

Right. But that doesn't mean they want a Trade War - and certainly not with the entire world, not just the U.S. As you point out sometimes in other contexts, it's about incentives. By integrating China into the global economy, we vastly disincentivize them from getting into a "hot" military conflict. Which has been incredibly successful - over the last four decades, nearly all of our global adversaries have engaged in those kinds of hot conflicts and direct military actions (Iraq, Russia, Libya, Iran, etc.). But not China, who has refrained from letting things get to the point of major shooting wars, and indeed has kept their client North Korea bottled up as well.

I'm not sure what you're arguing here. Upthread you touted the CHIPs Act and the Inflation Reduction Act but here you're saying that massive government intervention is a bad thing. BTW the reallocation of capital in this U.S. into industries and fields that there is no market reason to invest in is exactly what every single green initiative the west has engaged in has been doing.

Sorry I wasn't clear. It might help to think of these policies in an "sufficient" vs "insufficient" framework, rather than "good" or "bad" things. CHIPS and the various provisions of the IRA are useful baby steps towards reshoring very limited specific products, but are wholly insufficient to accomplish the kind of self-sufficiency in critical manufacture that you're describing.

Because you can't do that on a product-by-product basis. It's a massive, "whole of country" kind of undertaking. Competitive labor-intensive mass manufacture of the sort that China does requires an entire ecosystem in order to work. You need a large pool of manufacturing-ready labor and massive transportation infrastructure, both for inputs and finished goods. You need lots of manufacturers clustered in a particular area to create a mutually reinforcing and sustainable environment: parts manufacturers surrounded by multiple end-users of their parts, finished product assemblers surrounded by multiple parts manufacturers, tool and machinery manufacturers surrounded by the other manufacturers who will use their tools and machinery to make their products, and all serviced by transportation providers and warehouses and utilities and the like.

You can't recreate that here in the U.S. by just tinkering around the edges with product specific incentives like the CHIPs Act or the IRA provisions. You might get a small handful of very specific products that are most heavily subsidized to get made here, but they'll always be at a massive disadvantage absent the subsidies. Because you're not going to be able to make a manufacturing hub like Shenzhen here that way. You can't just make the high-value products; you need to get manufacturing of everything up and down the supply chain here. You can't just have a couple hundred people putting in the tiny screws of iPhones (because iPhones are cool and high-tech): you need many more thousands of workers putting in the tiny screws into countless other low-value products, and thousands of workers making the tiny screws (low-value low-tech jobs), and thousands of workers making the screwdrivers and workbenches and other tools for the tiny-screw workers (even more low-value low-tech jobs). You would need a massive reallocation of U.S. capital and labor into a vast amount of very low-value, low-paying, repetitive, dangerous, and frankly lousy jobs in order to create the ecosystem where the handful of "critical" products could also be made here. To say nothing of federally funded public works projects in energy, transportation, and housing infrastructure that would make the New Deal look small.

That vision of America is far closer to the Sanders wing of the Democratic party than even the Trump wing of the GOP, much less the Freedom Caucus wing of the Republicans. Remember, they were aghast at the idea of the CHIPs Act and the BIL - which are small, and the part of that program that's the most palatable for them.

No, what?

Are you saying China isn’t using their Belt and Road to muscle other countries?

Egads. Stop trying to score points in games you know nothing about.

As you point out sometimes in other contexts, it's about incentives. By integrating China into the global economy, we vastly disincentivize them from getting into a "hot" military conflict.

Did we? The CCP had its hands full getting the country on its feet.
The entire time since they were granted Most Favored Nation status they've been building muscle and learning how to be a global power. Now here we are.

China
-Is as close to an early 20th century robber baron - in nation-state form - that one could get
-Routinely bullies, intimidates and uses its economic power to exert influence
-Routinely lies and steals intellectual property from others
-Routinely fuels mass death in the United States via fentanyl
-Routinely abuses human rights en masse at home and abroad to feed their economic machine
-Routinely engages in large scale espionage and cyber attacks against the United States
-And increasingly...they're trailing their coats in ways meant to intimidate their neighbors.

They can accomplish an awful lot without firing a shot.

They're not good guys. Far, far from it.

But not China, who has refrained from letting things get to the point of major shooting wars, and indeed has kept their client North Korea bottled up as well.

You're aware that China doesn't need to fight when it has proxies to do it for them, right?

In the Red Sea: https://ceias.eu/china-in-the-red-sea/

Funny how no Chinese ships are ever troubled while sailing there, and everyone else is. Who benefits in that scenario? Especially when NATO navies are expending loads of expensive weapons on the daily?

Russia: https://nationalinterest.org/blog/buzz/the-subtle-...

The Chinese are funding Putin's war and keeping his economy afloat. Why? Because it's bleeding the West financially. Who wins in that scenario?

You would need a massive reallocation of U.S. capital and labor into a vast amount of very low-value, low-paying, repetitive, dangerous, and frankly lousy jobs in order to create the ecosystem where the handful of "critical" products could also be made here. To say nothing of federally funded public works projects in energy, transportation, and housing infrastructure that would make the New Deal look small.

I'll disagree with you here. America is actually home to a number of light and medium manufacturing shops and has existing infrastructure. Do we need more? Sure. But not nearly on par with the New Deal or whatever it is that Bernie Sanders wants.

They can accomplish an awful lot without firing a shot.

They're not good guys. Far, far from it.

I'm not saying they're good guys. I'm saying it's a massive national security win for us if they're not firing shots.

One of the most significant national security threats to the United States - a real one - is the threat of nuclear weapons. China is one of the world's major nuclear powers, and one of only two nations that could actually substantially destroy the United States. A "hot war" involving China is one of the gravest threats to our country. Things that reduce the chances of that happening, even by small amounts, have an enormous benefit to our security. And that benefit is probably larger than any of the detriments you outlined above.

I'll disagree with you here. America is actually home to a number of light and medium manufacturing shops and has existing infrastructure. Do we need more? Sure. But not nearly on par with the New Deal or whatever it is that Bernie Sanders wants.

It's not the same thing. We have manufacturing, but we can't do the type of labor-intensive low-value manufacturing at scale that would enable the critical product manufacturing that you want to be relocated here.

Those types of manufacturers can't be sustained in a vacuum. They need to cluster. They need to have access to vast pools of labor, other manufacturers who are making the parts and tools and components (and the tools and machinery that other manufacturers use to make the parts and components), and a transportation infrastructure capable of meeting their needs. And all those other firms and companies and actors can't come here if their only customers will be the specific "critical" manufacturers we deign to subsidize.

IOW, the stuff that the "critical" goods manufacturers need to have available to them is orders of magnitude greater than what we can currently provide in the U.S. We don't have, and can't have, a few million low-wage workers living in government-built SRO housing barracks waiting that can be used to flood the factory floors of countless low-value component manufacturers that make up the supply chain for the "critical" goods. We don't have, and won't fund, the type of massive public works, transportation, and utility infrastructure that needs to be undertaken by the national government in order to service all those factory floors. The "critical goods" that you'd prefer to have manufactured here are the tip of a big pyramid that supports their production, and you can't have that tip of the pyramid without building the whole pyramid. China was able to build that pyramid because their country was filled with uneducated subsistence farmers for whom the low-value factory jobs needed at the base of the pyramid were a massive step up in quality of life. The U.S. long ago moved past that point.

To build that pyramid here in the United States would require a complete reworking of our economy. There's absolutely no market basis for moving all that low-value manufacturing capacity here (the market doesn't care about national security, after all), so you would need a level of federal intervention in the private economy never before seen in the U.S. to make it happen. The federal government would have to wrench both capital and labor out of where it would normally go in response to market forces and mandate that it go into basic manufacturing and all the things that basic manufacturing needs, at 10x the level of difficulty that China had in doing that because our workers are already so well paid (relative to global levels). And we'd have to recreate all the public works and governmental projects that China spent the last several decades building - the roads and rails, the ports and shipping, the utility lines and power generation. Again, the government would have to do that (either directly or indirectly), because there's no market reason for any private actors to be doing any of that. You can't do it with tariffs.

That undertaking would run contrary to everything the GOP stands for in domestic policy. It would run contrary to nearly all of what most Democrats would support, since the center of even the Democratic party wouldn't be okay with that level of government direction of the national economy. Only the far left of the Democratic party - the Sanders wing - would be comfortable with subordinating the market to the direction of the government to that extent.

Apologies for not reading the whole thread. Mostly I find myself in agreement with you, except for this one statement (to follow). Maybe someone already addressed this.

Which in no small part has contributed to China almost entirely refraining from military belligerence over the last 30-35 years.

Tell that to Tibet. And the Uyghurs. And, more recently, several nations around the South China Sea. So, I tend to agree that we've been "feeding the dragon" since the 70s. We enabled them to build a military that is able to challenge us. Plus, I'm not sure that internal stability in China has been a good thing since it has resulted in an ever-hardening regime. There is almost no chance of democracy ever growing there without internal discord. So, while the intent was what you said (with the "bonus" that US corporations got a vast reservoir of cheap -sometimes slave- labor), the reality is we have created a formidable antagonist with expansionist ambitions.

I'm not saying they're good guys. I'm saying it's a massive national security win for us if they're not firing shots.

They're getting us to fire shots via proxies. All the while playing the rest of the world. Is it as bad? No, obviously. But not great.

One of the most significant national security threats to the United States - a real one - is the threat of nuclear weapons. China is one of the world's major nuclear powers, and one of only two nations that could actually substantially destroy the United States. A "hot war" involving China is one of the gravest threats to our country.

But that has nothing to do with trade policy.
Nuclear weapons aren't battlefield in nature. They're political. Once the first nation launches a nuke for any reason the other will respond in kind.

We have manufacturing, but we can't do the type of labor-intensive low-value manufacturing at scale that would enable the critical product manufacturing that you want to be relocated here.

That's right, we won't. The kind of truck-them-in-from-the-vil and line them up elbow to elbow manufacturing scheme that China employs won't work here. What we would do is handle it via automation and efficiency. Take steel:

https://fred.stlouisfed.org/series/IPUEN3311W20000...
Employment today is less than half of what it was in 1990. However, steel production
https://fred.stlouisfed.org/series/IPN3311A2RS

...has not decreased by that amount.

Those types of manufacturers can't be sustained in a vacuum. They need to cluster. They need to have access to vast pools of labor, other manufacturers who are making the parts and tools and components (and the tools and machinery that other manufacturers use to make the parts and components), and a transportation infrastructure capable of meeting their needs. And all those other firms and companies and actors can't come here if their only customers will be the specific "critical" manufacturers we deign to subsidize.

And do you think these places don't exist in the United States? We don't have ports with rail lines and what not? We don't have the ability to move goods around from point A to point B?

One reason why Europe sucks at this and won't reach their potential is their lack of big trucks on the highway, intercontinental waterways and small electric trains. We have all 3 in a very flexible transportation/logistics setup in the US.

And we'd have to recreate all the public works and governmental projects that China spent the last several decades building - the roads and rails, the ports and shipping, the utility lines and power generation. Again, the government would have to do that (either directly or indirectly), because there's no market reason for any private actors to be doing any of that. You can't do it with tariffs.

No one has said that tariffs will build more Hoover Dams.
I hate to break this to you, but the nation needs far more unsexy things like port and airport upgrades, power lines and power generation just to maintain our current levels of industrial outputs. All those AI data centers? They're not going to power themselves.

One of the biggest follies of the green movement was in failing to address the obvious increase in demand on the nation's power grid and infrastructure when you add millions more vehicles taking power from it.

But that has nothing to do with trade policy.

Ah, but it does. The more closely integrated the Chinese economy is with the global economy, the greater the pain that comes in response to military action. When China was more economically isolated, the primary consequence they would face for military adventurism would be a military response. Now, if they were to roll into Taiwan (for example), the response from the rest of the world would not be limited to a military response, but a massive blow to their economy as well.

That's right, we won't. The kind of truck-them-in-from-the-vil and line them up elbow to elbow manufacturing scheme that China employs won't work here. What we would do is handle it via automation and efficiency.

But there's a lot of stuff that can't be handled that way. Or rather, the ordinary application of free market forces would not have it handled that way. The lower end of the value chain isn't going to be located in the U.S., because it is more efficiently done with human labor rather than automation; and the higher end of the value chain "wants" to be located in proximity to their supply chains (and possibly vertically integrated with it), which means that it won't be located here.

Again, it's the tip of the pyramid problem. You can't have the 'critical' products manufactured here unless you also have all of the necessary inputs available here - which means you can't have the tip of the pyramid unless you build the whole pyramid. Which means you have to have government intervention in the marketplace not just in the specific sector of the critical products, but all the things that feed into it - the sectors that make the components and the sectors that make the machinery to make those components and the sectors that make all of the equipment necessary to test those components, and the labor supply to feed into all those sectors. It's a massive undertaking under any circumstances - and if you propose to do it in the face of the Invisible Hand of the Free Market, which is pushing all of those resources into other parts of the economy instead of where you now want them to go, it's going to be herculean. And yes, I know that an Invisible Hand does not have a face. It's a Hand.

And do you think these places don't exist in the United States? We don't have ports with rail lines and what not? We don't have the ability to move goods around from point A to point B?

We don't have the slack capacity to do that materially more than we do now, no. If we wanted to relocate vast swatches of the global manufacturing sector back to the U.S., then all of our rail and port and road systems that have been built to meet current needs will have to be massively expanded to accommodate the new stuff. Because the existing system doesn't have enough slack capacity to handle that.

We see it most acutely today with electrical power and AI. As you point out, we have a massive exogenous demand for more electricity to meet the needs of AI centers - and so companies like Google are considering building their own nuclear power plants to meet that need. Which is something that can happen if the new infrastructure is being driven by market forces. But if you want to force that infrastructure to get built without the spur of the IHOTFM, it's the government that needs to do it.

And yes, I know that an Invisible Hand does not have a face. It's a Hand.

I stand corrected....

https://www.austinchronicle.com/binary/a354/tmw.jp...

Invisible Hand reveals his face (Hand) …. or maybe it’s “Hand (face)” in a miraculous visitation of glory!

Blessed be He!

Ah, but it does. The more closely integrated the Chinese economy is with the global economy, the greater the pain that comes in response to military action. When China was more economically isolated, the primary consequence they would face for military adventurism would be a military response. Now, if they were to roll into Taiwan (for example), the response from the rest of the world would not be limited to a military response, but a massive blow to their economy as well.

Would you care to guess who Germany's #1 trading partner was at the outset of World War 2?

France.

But there's a lot of stuff that can't be handled that way. Or rather, the ordinary application of free market forces would not have it handled that way. The lower end of the value chain isn't going to be located in the U.S., because it is more efficiently done with human labor rather than automation; and the higher end of the value chain "wants" to be located in proximity to their supply chains (and possibly vertically integrated with it), which means that it won't be located here.

You're making the argument of comparative advantage to a degree. That's why I'm fine with somebody else making simple things like mops and whatnot that are easily picked up in the event of a supply outage. But why do you feel that rare earth element processing or semiconductor sourcing is at the low end of the food chain?

Again, it's the tip of the pyramid problem. You can't have the 'critical' products manufactured here unless you also have all of the necessary inputs available here - which means you can't have the tip of the pyramid unless you build the whole pyramid.

You're literally arguing against the entire history of the United States. There's a reason why we've been #1 and when we weren't #1 we were on the fast track to getting there - we have land, we have labor, we have capital that can be utilized and invested here.

We have a large labor force and can import more - legally - if we need to. Nation of immigrants, remember?
We are the 3rd largest country by land area but something like 180th in population density...meaning we have room to grow.
As a part of the land ledger, we have abundant natural resources in the forms of

-Energy, oil/gas/coal/solar/geothermal/hydro/nuclear (if we build more)/tidal/wind
-Arable land - we have the most in the world
-Mineral resources - we have a lot across many states

Captial - the world's 2 largest stock exchanges, the NYSE and the NASDAQ combined represent some 46% of the world's total. And that doesn't even account for the trillions of dollars in commodities that flow through the Chicago Board of Trade.

Were you aware that we're #2 in oil refining also?


We add value up and down the chain.

We don't have the slack capacity to do that materially more than we do now, no. If we wanted to relocate vast swatches of the global manufacturing sector back to the U.S., then all of our rail and port and road systems that have been built to meet current needs will have to be massively expanded to accommodate the new stuff. Because the existing system doesn't have enough slack capacity to handle that.

Haven't been able to find the rail capacity by utilization rate, but according to this

https://www.aar.org/wp-content/uploads/2024/07/AAR...

...the "freight car storage data" is about 20%, meaning 20% of freight cars are being stored someplace.

We see it most acutely today with electrical power and AI. As you point out, we have a massive exogenous demand for more electricity to meet the needs of AI centers - and so companies like Google are considering building their own nuclear power plants to meet that need. Which is something that can happen if the new infrastructure is being driven by market forces. But if you want to force that infrastructure to get built without the spur of the IHOTFM, it's the government that needs to do it.

Glad you're mentioning the Invisible Hand. The Invisible Hand has another name: incentive-driven behavior.

For too long, *ALL* the incentives were towards a race to the bottom in terms of wages and convenient geolocating to the Pacific Rim. As we've said, that's great for them...with a mixed bag for us that while some sectors absolutely benefited, it's indisputable that others suffered.

No one is saying, 'let's go back to 1948 when the only industrial power left standing on the planet was the United States'. People tend to forget that the entire rest of the world required the United States to build infrastructure since the collective economies of China, Japan, France, Great Britain, Germany and Italy were put to the torch. Prior to WW2 the US had 2x the GDP of anyone else and after that went to 3x. That kind of event is something the world hopefully never experiences again.

There's nothing wrong with promoting a resurgence of high-value manufacturing in the United States. There's nothing wrong with weaning our economy off of bad actors globally. I can recall when it was supposedly impossible for the US to get off of foreign oil...yet somehow, it happened.

Would you care to guess who Germany's #1 trading partner was at the outset of World War 2?

France.

Right. Incentive not to engage in military adventurism - not an absolute barrier to doing so. If China wants to invade Taiwan, they can invade Taiwan at any time - what the rest of the world does is create disincentives to them invading Taiwan through the consequences that would inexorably follow. Integrating them into the global economy increases the consequences.

You're making the argument of comparative advantage to a degree. That's why I'm fine with somebody else making simple things like mops and whatnot that are easily picked up in the event of a supply outage. But why do you feel that rare earth element processing or semiconductor sourcing is at the low end of the food chain?

I'm not (although we don't import many semiconductors from China). What I'm talking about is that the high end of the food chain requires the low end of the food chain to be nearby. For example, making iPhones or other complicated electronic devices is at the high end of the food chain. But the company making those devices doesn't just need a plant that can assemble the device; they need to be in the same place as nearly all of the factories that are assembling the cheap, inexpensive, and boring components of that device. The plant where the iPhones are being assembled "wants" to be an area where there are a hundred factories that make cheap tiny screws - so that if there's a new model of the phone that requires a different cheap tiny screw with different specs and different tolerances, they can make that change with a single phone call without having to rework their entire supply line and distribution and schedule.

You're literally arguing against the entire history of the United States. There's a reason why we've been #1 and when we weren't #1 we were on the fast track to getting there - we have land, we have labor, we have capital that can be utilized and invested here.

And we've allocated that land and labor and capital and made those investments to the places where they are most efficiently deployed, for the most part.

I'm not arguing against the entire history of the United States - I'm arguing in support of it. Through the period where we've been number 1, we mostly haven't had the federal government coming in and centrally planning the economy to achieve whatever the priorities of the government were, rather than what makes economic sense.

What you're advocating is what runs counter to our past history. The free market efficient outcome for producing nearly all of these manufactured goods is to produce them overseas using low cost labor and eating the transport cost, rather than trying to produce them domestically using either higher-cost labor or automation. If you want to diverge from the efficient outcome and force these goods to be produced here, it's going to take a ton of active governmental involvement and a whole lot of government funds to push us away from the market equilibrium outcome. Which, again, is more the Sanders Solution than the Republican Response.

There's nothing wrong with promoting a resurgence of high-value manufacturing in the United States. There's nothing wrong with weaning our economy off of bad actors globally. I can recall when it was supposedly impossible for the US to get off of foreign oil...yet somehow, it happened.

Yeah, with technology. Not because of any of the things that government was trying to do to force us to wean off foreign oil. If someone developed a new technological process for making t-shirts or tiny iPhone screws or any other product currently being mostly done overseas that would allow them to be more efficiently built here instead, then it would happen. But government can't simply decide that iPhones should be made in the U.S. and have it actually happen, unless the government is willing to commit to commanding the economy and/or providing the funding that would cause that to take place.

China and SE Asia have the high-value manufacturing that benefits from being near the low-value manufacturing and/or is more efficient to provide with cheap labor. If you want to "promote" a change to that, you need to be willing to do the things that will actually make that change. And I doubt very much that the GOP is willing to do that.

Right. Incentive not to engage in military adventurism - not an absolute barrier to doing so. If China wants to invade Taiwan, they can invade Taiwan at any time - what the rest of the world does is create disincentives to them invading Taiwan through the consequences that would inexorably follow. Integrating them into the global economy increases the consequences.

They may not care.
At any rate, they have a long history of subjugation behind them and they're showing every sign of continuing along those lines.
What do these geographic locations have in common:

-Panama Canal
-Cape of Good Hope
-Suez Canal
-Papua New Guinea
-Soloman Islands

I'll answer for you: The Chinese are parking military assets either there or right near most of these places. For areas like the Panama Canal they're securing influence.

Again - they don't necessarily need to fire a shot to achieve their aims. With a weak kneed and largely disarmed Europe, who besides the US - and specifically, the United States Navy - is going to protect the world's sea lanes?

And before you cite the stat that Europe somehow spends more on its military than the US please go look up the Royal Navy and tell me what shape it's in. How many combat ships do they have at the moment? Again, I'll answer for you: they have 2 carriers with only 1 of them really working and are down to *17* frigates and destroyers. By way of comparison they had 138 ships and 33 subs in 1990.

I'm not arguing against the entire history of the United States - I'm arguing in support of it. Through the period where we've been number 1, we mostly haven't had the federal government coming in and centrally planning the economy to achieve whatever the priorities of the government were, rather than what makes economic sense.

Indeed. Which is why no one outside of Bernie Sanders is suggesting central planning for the US economy. It's not a thing. It never will be.

What you're advocating is what runs counter to our past history. The free market efficient outcome for producing nearly all of these manufactured goods is to produce them overseas using low cost labor and eating the transport cost, rather than trying to produce them domestically using either higher-cost labor or automation.

No. Far from it.
I'm advocating from taking away the dependency on hostile and semihostile foreign powers that we have on certain strategic goods. The most recent precedence for this is the energy - specifically oil and gas - sectors. It was always lunacy to allow an international cartel of some of the worst of the worst - OPEC - to set global oil prices. Now, does anyone care what happens when OPEC meets? We certainly don't.

Energy independence used to be scoffed at, and now is a reality. So why, in your mind, is it nearly impossible to make medicines, PPE and attempt to source critical minerals (and refine them) from somebody other than China?

If you want to diverge from the efficient outcome and force these goods to be produced here, it's going to take a ton of active governmental involvement and a whole lot of government funds to push us away from the market equilibrium outcome.

You're conflating providing incentives with Bernie Sanders and whatever he wants to do.

Yeah, with technology.

Of course. We excel in this space. We will lean into this strength.

Not because of any of the things that government was trying to do to force us to wean off foreign oil. If someone developed a new technological process for making t-shirts or tiny iPhone screws or any other product currently being mostly done overseas that would allow them to be more efficiently built here instead, then it would happen. But government can't simply decide that iPhones should be made in the U.S. and have it actually happen, unless the government is willing to commit to commanding the economy and/or providing the funding that would cause that to take place.

The "Invisible hand" provided an incentive in the form of a profit motive for oil producers to find creative ways to extract oil and gas from previously explored land. Lo and behold we went from "Peak Oil" and "the end is nigh for oil production" to suddenly leading the world in it.

There are many ways to incentivize a company to make a product in the US. Tariff policy is one. Tax breaks in the form of lower corporate rates and encouraging onshoring of profits is another. Reduced uncertainty is another. Companies were starting to move out of China pre-Trump47 due to just COVID alone as people began getting the brainwave that single-sourcing your products is a bad idea.

China and SE Asia have the high-value manufacturing that benefits from being near the low-value manufacturing and/or is more efficient to provide with cheap labor. If you want to "promote" a change to that, you need to be willing to do the things that will actually make that change. And I doubt very much that the GOP is willing to do that.

We don't need to scale manufacturing by trucking in cheap laborers and having them sit elbow to elbow Upton Sinclair-style in some slightly higher tech version of a 1900's meat packing plant.

I'll give you another number: 4,147,000. That's the number of permutations of Ford F-150 pickup trucks that were available in 2016. That's how flexible Ford's flexible manufacturing and supply chain management was and is.

You're literally arguing against the entire history of the United States.

Not really. All the readily-available resources have been used. What is left is what is NOT readily available--and will require massive investments to obtain what is desired.

Land? What a joke. Within 30-50 years, the southern HALF of the US will be mostly uninhabitable due to high temperatures and so on. Thus, living UNDER GROUND in many areas will be the ONLY option--or be dead.

Labor? From WHERE? Africa? LOL !!! Latin America will be mostly uninhabitable as well.

Again - they don't necessarily need to fire a shot to achieve their aims.

Which is better than if they were firing shots.

We don't get to tell China that they have to stay forever weak and poor. Just like America First allows the U.S. to struggle and strive and compete to enrich and empower our country, so too can the Chinese do that as well. It is far better for us if they direct those efforts into non-combat competitions in economic and diplomatic arenas than if they are firing shots.

Energy independence used to be scoffed at, and now is a reality. So why, in your mind, is it nearly impossible to make medicines, PPE and attempt to source critical minerals (and refine them) from somebody other than China?

Because the energy independence didn't result from a government choice to become energy independent. It happened because of technological developments in fracking that allowed it to become ridiculously economical to extract oil and gas domestically from shale. We tried to become energy independent for some four decades prior to that, with the federal government (and some state governments) using regulatory and financial carrots and sticks to try to force an outcome that was different than the market outcome. We failed. Continually. Because it's really, really, really hard to force a significant deviation from the market outcome if one of the major parties is averse to using federal government power to change the market outcome. We weren't energy independent for four decades, because the most efficient market outcome was importing oil for a very long time - and government was never given enough power to change that. Only when technology changed where the market outcome was - and not through any change in government policy - did we go to energy independence. It takes a lot to deviate from the market outcome.

You can do it, of course - but it requires an extremely muscular federal government intervention in the free markets to do it. The sort of muscular intervention that the GOP would never support today. (BTW, like semiconductors, we don't really import much medicine from China.)

You're conflating providing incentives with Bernie Sanders and whatever he wants to do.

Not conflating - just pointing out that merely "providing incentives" isn't going be effective unless they're so massive that we're in Sanders territory. Again, it's not a "good" vs. "bad" question, but "effective" vs. "ineffective." You can provide for "incentives" for domestic development all you like, but unless the incentives are really big then they won't change the outcomes. You need a program big enough to override the economics - real market-distorting levels of incentives. Again, that's the sort of thing from the Sanders wing of the Democratic party, not the Freedom Caucus wing of the GOP.

Again, all of this is possible if you're willing to pay the price. The price, in this context, is a massive amount of federal intervention in the form of industrial policy, regulatory or money or both. It doesn't mean anything to talk about "incentives" or "incentivizing" companies without talking about the magnitude of the incentive in question, the degree to which the government is intervening in the marketplace to get outcomes that are different from the ones that private parties and firms would reach through voluntary transactions. Big changes can't happen without big interventions. And the GOP doesn't want the federal government to have the power, or use the amount of money, necessary in order to accomplish those big interventions.

And here's another example of foreign investment going towards light/medium manufacturing at pretty efficient levels:

https://www.foxbusiness.com/economy/turkey-based-c...

Turkey-based copper wire manufacturer to invest $34M in South Carolina operation
91,000-square-foot facility to create more than a hundred jobs

A Turkey-based copper wire manufacturer announced on Tuesday it is investing $34 million in South Carolina to establish a 91,000-square-foot facility that will manufacture superfine electrolytic oxygen-free (EOF) copper wire in Fairfield County.


Mega Metal, which has more than 700 employees and distributes products to more than 30 countries, said the project will create 135 new jobs.

Once fully operational, the facility is expected to produce 55 million pounds of wire annually.

EOF wire is the good stuff, suitable for overhead power lines. 55M pounds of wire produced by only 135 employees is pretty cool.

Which is better than if they were firing shots.

Sure. Of course, if we continue down the path of being reliant on them for so much, when they start flexing their muscle to force everyone to pay more and more for those things and continue to give them concessions, is that awesome? Not really.

They're Confucians at heart. They understand that you don't train to fight and build capability to fight to go out and...fight. The best part of having muscle is the option to never use it. Anyone who's taken any form of martial arts understands the concept of it being better to not fight at all.

China is building a global Navy and a global support network for it that's sited along all the major trade choke points of the world. They're happy to sow chaos as long as they remain unaffected.

If the rest of the world is totally dependent on a Chinese monopoly...why *would* they need to fire a shot?

We don't get to tell China that they have to stay forever weak and poor. Just like America First allows the U.S. to struggle and strive and compete to enrich and empower our country, so too can the Chinese do that as well. It is far better for us if they direct those efforts into non-combat competitions in economic and diplomatic arenas than if they are firing shots.

Oh, they get a vote. And they're exercising it. Unless you want to live in a world with their thumb weighing heavily on it then we need to spool up certain things here in the US.

Because the energy independence didn't result from a government choice to become energy independent. It happened because of technological developments in fracking that allowed it to become ridiculously economical to extract oil and gas domestically from shale. We tried to become energy independent for some four decades prior to that, with the federal government (and some state governments) using regulatory and financial carrots and sticks to try to force an outcome that was different than the market outcome.

That's right. And in the case of energy independence, Obama fought it tooth and nail before deciding producing energy was a good thing. The government actively tried to slow down the energy production expansion by denying leases on public lands and spiking things like the Keystone Pipeline (which would have ironically really benefited Canada).

(BTW, like semiconductors, we don't really import much medicine from China.)

We buy some ~$24 billion in medicines from them, most generics.
https://www.atlanticcouncil.org/blogs/econographic...

We do seem somewhat dependent on them for cardiovascular meds for some reason.

They also supply starter compounds
https://thehill.com/policy/international/5133762-u...

In 2018, the U.S.-China Economic and Security Review Commission noted that the country was “heavily dependent” on drugs and API originating from China. A 2023 analysis from the Atlantic Council found that the value of Chinese-imported APIs has continued to grow in recent years.

According to Monica de Bolle, a senior fellow at the Peterson Institute for International Economics, the U.S. isn’t unique in its dependence on China for drugs, noting that the European Union is similarly reliant.

Not conflating - just pointing out that merely "providing incentives" isn't going be effective unless they're so massive that we're in Sanders territory.

Depends on what "massive" means. Currently Trump believes that unfettered access to the US market is enough of one. YMMV.

If the rest of the world is totally dependent on a Chinese monopoly...why *would* they need to fire a shot?

Because the world isn't totally dependent on a Chinese monopoly. There are lots of things that we import from China because it is cheaper and easier to do so. And there are lots of things that would be incredibly painful to deal with if China decided to stop making/exporting them to us, and we would have a rough go of it for a few years if they decided to play that card. But if they did play that card, we would take the pain and then manage. It would take a few years to spin up the things domestically that are currently being done in China - but if they cut off our supply of anything really critical, we'd be able to spin up an alternative source (either here or abroad) pretty quickly, and certainly fast enough that we wouldn't face any existential crisis over it. The ability to inflict a lot of economic pain on another country is not the same as controlling that other country.

That's right. And in the case of energy independence, Obama fought it tooth and nail before deciding producing energy was a good thing. The government actively tried to slow down the energy production expansion by denying leases on public lands and spiking things like the Keystone Pipeline (which would have ironically really benefited Canada).

And that wasn't effective, either. The shale boom happened, mostly unabated. Modest governmental efforts will only have marginal effects. If you don't get a major exercise in governmental power (like an actual bill out of Congress banning fracking, in this example), then minor governmental measures won't result in much change from where the private parties will go.

Right now, the economics make it vastly more efficient to produce certain industrial goods abroad. Our industrial output in the U.S. is as high as ever, but almost anything that is more efficiently produced using labor-intensive processes (or parts that come from labor-intensive processes) is being produced mostly in SE Asia. The U.S. can't change that with modest measures.

Depends on what "massive" means. Currently Trump believes that unfettered access to the US market is enough of one. YMMV.

Sure. If you imposed an embargo on China, the U.S. would stop importing stuff from China. Like I said, I'm not claiming this can't be done - just that the price of doing it is a muscular government intervention in the free markets that's far closer to the Sanders side of the political spectrum than the GOP would ever be comfortable with.

Yes, I know, the GOP has decided to pretend for a while that "tariffs" aren't the sort of high-tax, government picking winners-and-losers intervention that they have historically attacked up and down. It's not big government to have massive taxes on goods? I don't think many in the GOP have really changed their attitude on that. My guess is that Bessent had persuaded them that Navarro isn't really driving the trade bus, and that the tariffs would not stay at embargo-like levels for very long. So they were able to avoid publicly crossing Trump while anticipating that we weren't going to have a "massive" governmental intervention in the market. Recent events seem to bear out the wisdom of that.

Because the world isn't totally dependent on a Chinese monopoly.

Yet. And not for lack of trying on their part.

Yet. And not for lack of trying on their part.

They won't be. They can't be. The world is too big and has too many countries for that to happen. If China were to decide to stop exporting stuff, it would hurt - but that's it. You couldn't replace anything that you rely on China to produce immediately, but neither is anything China's producing truly irreplaceable given a few years. Those few years would be painful, but not fatal. It's why OPEC never got to rule the world, despite having their finger on the trigger of the Oil Weapon. Sure, they had the power to induce a recession in the U.S. (or globally) any time they wanted, but that's not enough of a sword to hold over the U.S.' heads to have any real dominance.

Plus, this sort of "power" is very much like having a hand grenade in an elevator. If we were in an elevator, and I had a hand grenade, and I told you that you had to give me your wallet....would you? Sure, I'm holding a hand grenade - which means I have the power to maim or kill you if you don't do what I say. But I'm in the elevator, too. I would also get badly hurt or killed if I pulled that pin. Since I'm holding the hand grenade, I have more control over the situation than you do. But at the end of the day that doesn't get me all that much.

It's why OPEC never got to rule the world, despite having their finger on the trigger of the Oil Weapon.

The 1970's called and would like to have a word with you.

Plus, this sort of "power" is very much like having a hand grenade in an elevator. If we were in an elevator, and I had a hand grenade, and I told you that you had to give me your wallet....would you? Sure, I'm holding a hand grenade - which means I have the power to maim or kill you if you don't do what I say. But I'm in the elevator, too. I would also get badly hurt or killed if I pulled that pin. Since I'm holding the hand grenade, I have more control over the situation than you do. But at the end of the day that doesn't get me all that much.

That very much depends on who your victim is. If your victim believes you're crazy and willing to pull the pin, they'll hand over their wallet. In the case of China, they will have no compunctions about throwing their weight around to extract concessions from the Europeans, who collectively are too weak to do anything about it. That means outsized Chinese influence in global affairs and eventually more China-friendly governments around the world. That's not a great scenario for the West.

In the current mix of things, the Chinese wouldn't need a hand grenade in the elevator to make the Euros roll over. Them merely holding a paper clip would do it.

The 1970's called and would like to have a word with you.

I was around back then - very young, but around. OPEC had influence....but that's it. Just influence. And not even too much of that - you'll notice that OPEC failed to achieve the primary goal of the 1973 oil embargo, which was to get the U.S. to stop supporting Israel. All they were able to do was force the U.S. to undergo a painful recession. Which we experienced, got through...and they never did it again, because the limits of the Oil Weapon were laid bare once it was used. It allowed OPEC to have a modest amount of influence on global policy decisions, but very much only up to a point.

That very much depends on who your victim is. If your victim believes you're crazy and willing to pull the pin, they'll hand over their wallet.

No one thinks China is crazy. Or whatever the analogue would be for anthropomorphizing a national government to the human condition of insanity.

The government actively tried to slow down the energy production expansion by denying leases on public lands and spiking things like the Keystone Pipeline (which would have ironically really benefited Canada).

Keystone Pipeline was bad for the US--per the TransCanada economic report to the Canadian govt. So there was no valid reason for the US to approve it. Idiots who are opposed to the US did support it. Oil prices in the Midwest rose as predicted once Canada had their own pipeline to an ocean port.

I was around back then - very young, but around. OPEC had influence....but that's it. Just influence.

Really? Just influence? I was around also.

The Arab Oil Embargo basically remade the auto industry from the ground up. Gone were the days of big, heavy muscle cars from the 1960s and 1970s and in came the era of the Econobox. The oil embargo caught the Big 3 flat footed and basically enabled a tidal wave of smaller, more fuel-efficient Japanese imports.

1 political action from a collection of bad state actors had massive ripple effects into the US (and world economy).

Salon has more:
https://www.salon.com/2015/03/07/the_month_that_ki...

October 1973 was a rude awakening for the entire United States. It was a watershed month for the American middle class. The Arab Oil Embargo would lead to the downfall of the American auto industry, whose generous wages and benefits set the standard for the entire economy. It was also the month of the Saturday Night Massacre, which made inevitable the downfall of Richard Nixon. The Watergate scandal resulted in changes to the American political system that put more power into the hands of lobbyists, political action committees and wealthy, self-funded candidates. Cooper didn’t know it at the time -- nobody knew it -- but the moment he started grounding those radio straps and tightening those nuts was the moment the upward fortunes of the American worker hit a wall. From the 1947 to 1973, the golden postwar quarter-century, hourly earnings grew at an average of 2.2 percent a year. Since 1973, they’ve been stagnant, barely keeping up with inflation, even as productivity has boomed.

The ripple effect was profound

The effect on the American economy was twofold: First, the embargo contributed to a recession in which the gross national product fell 2.1 percent, unemployment reached 10 percent, and inflation hit 12 percent. Not even the UAW contract could keep up with those prices. Second, as Don Cooper was learning during his tortuous return to the assembly line, Americans stopped buying American cars. The percentage of disposable income spent on new cars dropped from 4.8 percent to 3.8 percent -- the lowest since the Korean War -- and a lot of the purchases were fuel-efficient Fiats, Hondas and VW Beetles, which were less expensive to fill up than those street yachts the Lincoln Continental and the Chrysler New Yorker. The Big Three found themselves in a bind, which they soon figured out how to make worse. GM, Ford and Chrysler didn’t want to build small cars, because only ginormous cars provided the profits necessary to pay the wages and benefits they had just lavished on their workers.

So in short: One political decision from a collection of not-so-friendly countries led to...
-A complete remaking of the US auto industry
-A breaking of Detroit's dominance of automaking
-The rise of the Japanese car industry (at the expense of ours)
-The loss of tens of thousand of jobs as plants were idled
-Storied car companies started the spiral downwards (and out)
-One of the major forces and advocates for the blue-collar class lost most of its relevance

There's a lesson here. Never hand the enemy a weapon to use on *you*. Strategic dependence is one such weapon.

Really? Just influence?

Yes, just influence.

Sure, it dramatically changed consumer preferences in automobiles by raising the cost of gas. But that's very different from having geopolitical power. The OPEC Embargo failed completely to achieve its primary aim, which was to disrupt the U.S.' support of Israel. OPEC didn't intend to spur a shift in the fuel economy of automobiles. Probably quite the contrary. All of those changes you describe had no benefit to OPEC, and indeed hurt them somewhat going forward. OPEC thought they had a powerful weapon, but in the end it had very limited utility to them. The cartel gave them a lot of economic benefits, of course, and that wealth brought them a lot of advantages. But the ability to stop production didn't give them all that much sway in geopolitics. At most they were able to influence the foreign policy decisions of other countries, but they never had any actual control over those choices.

So while China's market dominance in certain products gives them a powerful tool to influence the choices made by other countries (like encouraging us to reverse our reckless tariff policies), it doesn't give them all that much power to use to achieve their goals. Some, to be sure - especially over those countries that are also within its military sphere of influence. But it's limited.

Sure, it dramatically changed consumer preferences in automobiles by raising the cost of gas.

It literally remade the entire auto industry, put thousands out of work and fundamentally changed Labor in the United States.

The OPEC Embargo failed completely to achieve its primary aim, which was to disrupt the U.S.' support of Israel.

That they didn't achieve their objective shows that we're not the guy in the elevator afraid of the weapon-wielding maniac. The grenade went off and we didn't cave...but the country's economy was forever different as a result.

How many times would you care to roll that set of dice? Or, using a more direct analogy: How many spins of Russian Roulette do you want to take?

OPEC thought they had a powerful weapon, but in the end it had very limited utility to them. The cartel gave them a lot of economic benefits, of course, and that wealth brought them a lot of advantages. But the ability to stop production didn't give them all that much sway in geopolitics. At most they were able to influence the foreign policy decisions of other countries, but they never had any actual control over those choices.

The Oil Embargo is best analogized with Pearl Harbor: caused a lot of pain in the short term but in the end was a strategic loss for them. It happened in fits and starts but the US and Canada now call their own shots in the energy business.

So while China's market dominance in certain products gives them a powerful tool to influence the choices made by other countries (like encouraging us to reverse our reckless tariff policies), it doesn't give them all that much power to use to achieve their goals. Some, to be sure - especially over those countries that are also within its military sphere of influence. But it's limited.

I never assume my enemies are dumb and that they'll make mistakes. OPEC made a strategic mistake by overplaying their hand. We shouldn't assume that China will do the same.

How many times would you care to roll that set of dice? Or, using a more direct analogy: How many spins of Russian Roulette do you want to take?

It's not Russian Roulette. In Russian Roulette, you die if you hit the wrong outcome. We didn't die when OPEC imposed the oil embargo. Nor was it just the oil embargo that prompted the massive shifts you describe - the rise in gasoline prices long after the Oil Weapon was fired, due to the existence of the cartel itself, played a huge role as well.

OPEC didn't "overplay their hand" - their hand just wasn't that strong. Because being the important supplier of a product like that gives you some economic power, and therefore some geopolitical influence, but only up to a point. So too with China.

It's not Russian Roulette. In Russian Roulette, you die if you hit the wrong outcome.

You brought up the specter of nuclear conflict up thread. Isn’t that a Russian Roulette scenario?

Lessening China’s power in the world lessens any potential for a conflict.

OPEC didn't "overplay their hand" - their hand just wasn't that strong.

Again, it was strong enough to completely reshape an important piece of US manufacturing. I’ll remind you that not just the Big 3 were affected: all the supply based that used to provide production inputs also suffered.

Why hand anyone else that kind of influence over your country when you don’t have to?

Ah, but it does. The more closely integrated the Chinese economy is with the global economy, the greater the pain that comes in response to military action. When China was more economically isolated, the primary consequence they would face for military adventurism would be a military response. Now, if they were to roll into Taiwan (for example), the response from the rest of the world would not be limited to a military response, but a massive blow to their economy as well.

This. There's a benefit to the international order that seems to escape MAGA.

There's a benefit to the international order that seems to escape MAGA.

No one says there aren’t any benefits to the current order.

At any rate. Adults are talking.

No, what?

Are you saying China isn’t using their Belt and Road to muscle other countries?

Egads. Stop trying to score points in games you know nothing about.

No Dope, I misread you as claiming their Navy was doing the muscling. But you should've responded also with the Chinese ship anchoring in the Persian Gulf - so you missed a trick.

Muscling is usually use for military force - not economic leverage.

And please be civil, you talk down to Albaby who is obviously very patient with you. Please don't talk down to me either. But I do like the fact you brought out an econ formula in the other thread. Keep it up.

It literally remade the entire auto industry, put thousands out of work and fundamentally changed Labor in the United States.

The OPEC Embargo failed completely to achieve its primary aim, which was to disrupt the U.S.' support of Israel.

That they didn't achieve their objective shows that we're not the guy in the elevator afraid of the weapon-wielding maniac. The grenade went off and we didn't cave...but the country's economy was forever different as a result.

What I remember was we learned that our auto industry had become complacent and had not innovated. We were being out engineered by both the Asians (Japanese) and the Euros. As a kid, Japanese quality was a joke - no more. Our oil industry had stagnated too. The days of just drilling a hole and moving when the pressure got low were numbered. We had to invent ways to extract oil after the pressure got too low, from oil tar, and to frack for oil. The oil engineers had also figured out that oil pollution would slowly raise the temperature of the earth.

Why hand anyone else that kind of influence over your country when you don’t have to?

Why? Because there's no single "you" that's "handing" anyone anything. The situation arises from the free market transactions of millions of people and countless firms. And there's no political will to have the government intervene to override those choices.

Think about it - what could you possibly have had the government do in, say, 1967 that would have been material enough to have blocked the negative effects of the OPEC oil embargo? Would you have been able to pass a whopping big gas tax doubling the price? CAFE standards that would have forced domestic car companies to stop building the big cars consumers wanted and instead start building fuel-sipping econoboxes - before there had ever been an oil crisis and while gas was still cheap? Bah - they would have called anyone who proposed it a communist and run them out of town.

Consider the same thing with PPE (for example) in 2018 or so. To get major PPE makers to reshore to the U.S., you'd need to have created a massive subsidy program to make it economically viable for manufacturers to consider moving their very low-tech products back to America. Even then, it might not be enough just to subsidize the PPE makers - because they would need to be able to get all their components made for them, and it might not be viable to have those still being produced overseas (nor would it solve your security problem if they were). So it's not just the companies that make the PPE - it's all the companies that make the fibers and fabrics and fasteners and latex and what have you that have to get subsidized. And the companies that make the machines and tools that these companies need from time to time. You need to come up with a program that's big enough to make all of those folks - the PPE makers and the ecosystem that makes them function - economically viable for them to locate in the US more than they are today. Harder still, these have to be durable enough that they can be confident that those subsidies are lasting for years and years to make it worthwhile for them to invest in factories and disrupt their current supply arrangements so that they know they won't get whipsawed a few years in. Remember, these aren't subsidies to promote a new industry - the subsidies have to last indefinitely, because as soon as the subsidies go away it won't be economical for the companies to keep making the products here.

You think that's getting past Chip Roy and the Freedom Caucus...much less survives Elon Musk's manic twenty-somethings who are looking for "waste" to "delete, delete, delete"? A massive subsidy program for companies to make gloves and masks and all the things that go into them in the US for gazillions of dollars per job?

There's a name for people who want the government to significantly intervene in free market outcomes in order to pursue some broader public good that is different from what the market participants would do if left on their own: liberals.

If you wanted something like this to happen, you would need to empower the federal government to survey the entire breadth of the market, identify whole sectors of manufacturing that create a vulnerability in case of embargo (PPE! Medicines! Semiconductors! Durable magnets! Electric machinery!), pick the winners and losers among the various industries and industry participants, shovel massive amounts of subsidies to all those private companies to give them enough incentive to reshore in sufficient quantities to ameliorate the vulnerability, and make those subsidies enough of a durable entitlement that the companies can be sure that they'll last long enough to justify the reshoring.

Which faction of which party does that sound like to you? That's why I keep pointing to Bernie Sanders - this type of robust and muscular national industrial policy fits exactly with his political philosophy, and it would be anathema to virtually every modern elected Republican.

Why? Because there's no single "you" that's "handing" anyone anything. The situation arises from the free market transactions of millions of people and countless firms. And there's no political will to have the government intervene to override those choices.

And that's what leads to the race to the bottom syndrome, which is what the left argues is the central feature of capitalism itself, where with no protections all things flow to the lowest wage centers and those that used to do a thing are out of luck.

Think about it - what could you possibly have had the government do in, say, 1967 that would have been material enough to have blocked the negative effects of the OPEC oil embargo?

You mean other than drill for oil in the United States and not create a dependency on unreliable sources?

You think that's getting past Chip Roy and the Freedom Caucus...much less survives Elon Musk's manic twenty-somethings who are looking for "waste" to "delete, delete, delete"? A massive subsidy program for companies to make gloves and masks and all the things that go into them in the US for gazillions of dollars per job?

This is like arguing against buying earthquake insurance in California. It's not like we'd be stockpiling tea doilies in the event of a massive state visit by King Charles. Everyone understands that certain stockpiles of certain goods - or the ability to make them yourselves in a hurry - are sometimes necessary. Do Chip Roy and the others also dislike the Strategic Petroleum Reserve?

There's a name for people who want the government to significantly intervene in free market outcomes in order to pursue some broader public good that is different from what the market participants would do if left on their own: liberals.

That's not who liberals are and what liberals do. liberals fundamentally do not believe that individuals are capable of making their own decisions, trusting instead in a cadre of "experts" to be Wise Enough to know what to do. Conveniently these "experts" are fellow liberals who, once in government, proceed to assume control of everyday life. The problem is that the "Experts" oftentimes tend to be anything but.

There's nothing inherently "liberal" about wanting certain strategic industries located in your country. Let's say Vietnam emerges as someplace that could make steel for 5 cents a ton. Would you outsource 100% of US steel production to them?

Which faction of which party does that sound like to you?

I've always viewed Republicans as ants and liberals as grasshoppers, if you recall the old parable. So strategic planning is very much in line with the Republican view of things.

There's nothing inherently "liberal" about wanting certain strategic industries located in your country.

Please detail how you would have the PPE industry--produce in the US--and meet US demand for those items ALL THE TIME. Remember: This means US production of ALL the raw and semi-finished goods and materials that go into manufacturing PPE.

Tell us, precisely, what happened to the "surplus production capacity" once the Spankee Plague was declared as "over"? How long to *restart* that production if needed again?

Remember: I identified ALL these problems years ago--and what would happen.

Therefore, put on your "National Security" gear and tell us the solution. Or avoid it. You know it is impossible--even if the public SAY "WE WANT"--but does NOT want to PAY for it.

You mean other than drill for oil in the United States and not create a dependency on unreliable sources?

We were already doing that in the 1960's. The reason we were importing oil also was because that was the economically efficient outcome. The reason we kept importing oil is because it was the economically efficient outcome. If you wanted to change that in the 1960's, you couldn't have done so by just telling people, drill

Do Chip Roy and the others also dislike the Strategic Petroleum Reserve?

They don't - but that doesn't solve the problem. You can have stockpiles, but you're not reshoring any of the industries. Which means you can reserve stockpiles for the government to use, but they're probably not going to be able to stockpile enough to cover the needs of the broader economy for products that are used regularly across the economy.

If all you're talking about is a huge PPE stockpile that the federal government maintains, that's an easy thing to do. But if you're trying to actually get PPE production back to the United States because a stockpile only gets you so far, that's an entirely different undertaking.

There's nothing inherently "liberal" about wanting certain strategic industries located in your country. Let's say Vietnam emerges as someplace that could make steel for 5 cents a ton. Would you outsource 100% of US steel production to them?

"I" wouldn't get to decide that. It's not my choice. It's not your choice. It's the choice of the many thousands (hundreds of thousands?) of firms that use steel and steel products where to buy their steel from.

In order to prevent that from happening, you need to empower the government to do something to keep the steel industry in the US, which would almost certainly involve providing massive subsidies to the domestic steel industry so that they can sell at a price competitive with the 5 cents per ton. That's more of a fundamentally liberal position, rather than conservative ones. It's more aligned with a liberal perspective to conceptualize the country as a "you" that collectively decides where to buy steel from, rather than an undifferentiated "we" whose decisions are the result of millions of individual choices unfettered and constrained by any collectively imposed mandate about how to live their lives.

I've always viewed Republicans as ants and liberals as grasshoppers, if you recall the old parable. So strategic planning is very much in line with the Republican view of things.

Except the Republicans are very much against the government doing the strategic planning when it comes to directing the private economy. To borrow the terms of the old parable, these problems need the government to step in to tell the grasshoppers and ants what to do, rather than what they would normally do on their own. That's not what the GOP is willing to do. At least not to the extent necessary to make the scope of changes that would address the problem you're saying needs to be addressed.

We were already doing that in the 1960's. The reason we were importing oil also was because that was the economically efficient outcome. The reason we kept importing oil is because it was the economically efficient outcome. If you wanted to change that in the 1960's, you couldn't have done so by just telling people, drill

We weren't energy independent, that's the point. The fact that we weren't exposed the US economy to a large exogenous shock.

They don't - but that doesn't solve the problem. You can have stockpiles, but you're not reshoring any of the industries. Which means you can reserve stockpiles for the government to use, but they're probably not going to be able to stockpile enough to cover the needs of the broader economy for products that are used regularly across the economy.

Sure. So you see the problem of having nothing handy that you can spin up...

"I" wouldn't get to decide that. It's not my choice. It's not your choice. It's the choice of the many thousands (hundreds of thousands?) of firms that use steel and steel products where to buy their steel from.

That's right. Would you agree that it's probably a bad idea to have *zero* domestic production of steel?
The government does things all the time to ensure that - just in case - we have things we need.

In order to prevent that from happening, you need to empower the government to do something to keep the steel industry in the US, which would almost certainly involve providing massive subsidies to the domestic steel industry so that they can sell at a price competitive with the 5 cents per ton.

You mean like tax breaks and subsidies out the wazoo? We've never done those, right? :)

Except the Republicans are very much against the government doing the strategic planning when it comes to directing the private economy.

There's a very large distinction between directing the entire economy and encouraging certain industries to relocate here. You're about to see another such effort spool up in the area of shipbuilding. Here's a primer:

https://cdrsalamander.substack.com/p/the-maritime-...

There are currently 154 active shipyards in the US, spread across 29 states. That’s an impressive figure, except when you realize only ten are engaged in building large-scale vessels, and only four do any shipbuilding for the U.S. Navy. The possibility that this number may shrink further has put Congress and the current administration on notice. They realize they need to address America’s shipbuilding gap with China before it’s too late. Because if civilian shipbuilding disappears from our shores, the US Navy will be on a trajectory for irreversible decline, as well.

…

Chinese shipyards have 200 times the capacity of US yards. Some are building as many as 13 ships at once, with naval and commercial vessels coming down the slips at the same time.

Meanwhile, the FY 2025 budget forecast has the US Navy building just six ships in 2025, while decommissioning 19 vessels—a net loss of 9 ships. In 2023, China added 30 ships to its navy. The United States added exactly two.

Is this acceptable to you?

We weren't energy independent, that's the point. The fact that we weren't exposed the US economy to a large exogenous shock.

Right, but that wasn't a choice made by the U.S. government. It was the result of the natural market outcomes of consumer and producer preferences that existed at the time. If anything was going to be materially different, the U.S. government would have needed to forcefully intervene in the market to force consumers and producers to behave differently. But there was no political will to make that kind of intervention - and if the government had tried, it would have been the conservative side of the political spectrum that would have strongly opposed it.

That's right. Would you agree that it's probably a bad idea to have *zero* domestic production of steel?
The government does things all the time to ensure that - just in case - we have things we need.

It depends on what the tradeoffs are in order to have non-zero steel production. If the tradeoffs are very large and the foreign sources of steel are dependable, stockpiles may be sufficient.

But yes, I think it is generally a good thing to have the government intervene in private markets when those markets will result in outcomes that are dangerous for the good of the country, even if they are the preferred outcomes by the market participants. However, that's generally a more liberal view than a conservative one.

You mean like tax breaks and subsidies out the wazoo? We've never done those, right? :)

And they're generally promoted by liberals, and often pilloried by conservatives. That's the point. Any subsidy that would be large enough to get, say, the PPE industry to materially relocate back to the United States would be heavily criticized by conservatives as being "waste, fraud or abuse" or government "picking winners and losers" among firms or industries.

There's a very large distinction between directing the entire economy and encouraging certain industries to relocate here.

True, but "encouraging certain industries to relocate here" involves a massive amount of government direction of the economy. In just the course of this thread, you've identified semiconductors, medicines and medical equipment, PPE, shipbuilding, steelmaking, oil and gas, and auto manufacturing as industries that the government should now (or should have in the past) forcefully intervene in. Which means having to intervene in an even larger number of subsidiary and enabling industries as well - you can't build something as complicated as a ship without a constellation of component and equipment suppliers. If you want more shipbuilders to build materially more ships for private purchasers in the U.S. than it makes sense to do under current market conditions, you're going to let the federal government step in and heavily intervene.

Is this acceptable to you?

That's the wrong question. It doesn't matter whether it's acceptable to me, because if it's better than the alternative, it's what we should go with whether I like it or not. So the relevant question is whether the status quo is better or worse than the measures that would have to be taken in order to get a materially different outcome. And I'm not the relevant person to decide which is acceptable, but whether you could get the U.S. Congress to agree that an alternative was better.

So, what's the alternative you're proposing? Surely not having the U.S. government pay private U.S. companies to engage in makework projects building commercial vessels that aren't needed, just to stay in practice (and in business) - the optics of that are just too terrible. But subsidizing unnecessary construction of commercial vessels here ends up being largely the same thing, and you'd probably never get it through Congress in the first place (the Freedom Caucus would tear it to shreds). Progressives might support it, since using the power of the federal government to change market outcomes to advance common and collective goals is consistent with their political philosophy - but the right flank of the Congress would be apoplectic at this. You can't shrink government so that you can drown it in a bathtub if you're setting up an entitlement program for commercial shipbuilders to suckle at the government teat indefinitely!

Right, but that wasn't a choice made by the U.S. government.

The choice was in not intervening.
Governments are very, very bad at future forecasting and this is why mandates usually fail. A great example was how everyone lauded Europe for mandating 3G coverage and for a short period of time they leapt ahead of others in 3G rollouts...but the mandate killed any incentive to get faster. The result was that China and the US blew past them in terms of wireless bandwidth and never looked back.

Governments tend to need clarifying moments to codify national strategy. We forgot that lesson in the years prior to WWII, learned it the hard way...then proceeded to forget.

It depends on what the tradeoffs are in order to have non-zero steel production. If the tradeoffs are very large and the foreign sources of steel are dependable, stockpiles may be sufficient.

But that's not the scenario. The scenario is that the steel is coming literally next door from the adversary who may decide to blow it all up one day. Is that an acceptable level of risk?

The US government btw doesn't think so: the CHIPS act was designed to avoid this exact scenario by having Samsung (memory), Micron (memory), Intel (CPUs) and TSMC (CPUs, GPUs, AI chips) build things here, safely out of the reach of Chinese rockets.

But yes, I think it is generally a good thing to have the government intervene in private markets when those markets will result in outcomes that are dangerous for the good of the country, even if they are the preferred outcomes by the market participants. However, that's generally a more liberal view than a conservative one.

I'll refer back to my ants and grasshoppers parable.

And they're generally promoted by liberals, and often pilloried by conservatives. That's the point. Any subsidy that would be large enough to get, say, the PPE industry to materially relocate back to the United States would be heavily criticized by conservatives as being "waste, fraud or abuse" or government "picking winners and losers" among firms or industries.

And rightly so. Let's recall...Solyndra. A more recent example was Biden's plan to build thousands of EV charging stations. So conservatives pillory these things because they're often wishcast-y items from the left in areas that haven't been proven out or demonstrated to be strategically important.

Conservatives are absolutely on board with mandating stuff that is required for the United States to function but won't get on board for the funding of fads or half-baked things (like Solyndra) or things best left to the private sector (like the charging station debacle).

In just the course of this thread, you've identified semiconductors, medicines and medical equipment, PPE, shipbuilding, steelmaking, oil and gas, and auto manufacturing as industries that the government should now (or should have in the past) forcefully intervene in. Which means having to intervene in an even larger number of subsidiary and enabling industries as well - you can't build something as complicated as a ship without a constellation of component and equipment suppliers. If you want more shipbuilders to build materially more ships for private purchasers in the U.S. than it makes sense to do under current market conditions, you're going to let the federal government step in and heavily intervene.

If you looked at the CDRSalamandar post you will have seen a photo of a shipyard in Portland that used to build Liberty ships. The picture from WWII shows more hulls in that particular place that the US put in the water all of last year. Much of the raw work has already been done; it needs moderinization, which was the point of the piece. If we're serious about a Naval future that is.

Nations need basics to survive. Nations that want to be global superpowers need a lot more than that. Everything that I've called out in this thread (chips, medicines, steel, cars and ships) are all things needed to be a global superpower especially when you consider that one of the primary sources for these things...is the potential adversary we would face.

I'll refer back to my ants and grasshoppers parable.

The parable doesn't work, because we're not talking about either the ants or the grasshoppers. We're talking about the government. The country is filled with ants and grasshoppers. If the ants and grasshoppers are individually making choices that result in an outcome that isn't advancing the collective needs of the country as a whole, should the government intervene in what the ants and grasshoppers are doing? That's the question.

The scenario is that the steel is coming literally next door from the adversary who may decide to blow it all up one day. Is that an acceptable level of risk?

The US government btw doesn't think so....

No - the Democratic Administration of Joe Biden didn't think so. Every Republican in the House (other than Don Young) voted against the CHIPS Act; nearly 3/4 of the GOP Senate did as well (including all the real free market conservatives). Trump wanted to repeal it.

Again, the question isn't whether it's an acceptable level of risk - the question is whether it's more acceptable than the alternative. If Vietnam were in fact producing steel at five cents a ton, instead of the $800-900 per ton it costs to make it here, it's almost certainly not a smart decision to try to keep domestic producers alive. The costs would be astronomical. No tariff would protect them - you'd have to embargo Vietnamese steel altogether, and that would basically destroy the U.S. economy's competitiveness with the rest of the world. Every economy on earth has basically free steel, and we're the only ones still paying $800-900 per ton? They'd all bound ahead of us. Ironically, the more essential a product is to your economy, the more damaging a protective tariff is. Or the alternative, the government would have to provide a 100% subsidy for steelmaking - basically paying 100% of the cost of the steel being produced. In which case you no longer have any steelmaking industry, but a nationalized Federal Department of Steel that makes its steel. Which you can do, but then there's no real need to have that nationalized steel industry producing steel at a loss for any private uses.

So in that scenario, efforts to try to protect a steel industry that had been completely rendered irrelevant by whatever the Vietnamese discovered would likely leave the country worse off than just accepting the situation and stockpiling massive amounts of steel for defense purposes.

If you looked at the CDRSalamandar post you will have seen a photo of a shipyard in Portland that used to build Liberty ships. The picture from WWII shows more hulls in that particular place that the US put in the water all of last year. Much of the raw work has already been done; it needs moderinization, which was the point of the piece.

Here's a suggestion - stop thinking of these issues using the passive voice. "It needs modernization." Think of who is going to take the action that results in modernizing a shipyard for which there is no commercial demand for their products. Who is going to bear that expense. Then it becomes clear that you're not saying, "it needs modernization," but instead are saying "the federal government should pay for a private party to be able to make money selling commercial ships" - and that they need to commit to paying that money for long enough to induce people to make long-term investments in an otherwise unnecessary shipyard.

See if that stands up to the Freedom Caucus or DOGE. Government handouts to profitable ship-building companies? That's not MAGA. Get Musk's boys on them - delete, delete, delete!

The parable doesn't work, because we're not talking about either the ants or the grasshoppers. We're talking about the government. The country is filled with ants and grasshoppers. If the ants and grasshoppers are individually making choices that result in an outcome that isn't advancing the collective needs of the country as a whole, should the government intervene in what the ants and grasshoppers are doing? That's the question.

Hey, *you* made it about lib vs. con. I just supplied an analogy on top of it :)

No - the Democratic Administration of Joe Biden didn't think so. Every Republican in the House (other than Don Young) voted against the CHIPS Act; nearly 3/4 of the GOP Senate did as well (including all the real free market conservatives). Trump wanted to repeal it.

And yet that's still called...bipartisan.

Again, the question isn't whether it's an acceptable level of risk

Of course it is. If in the event the Chinese decide to take down Taiwan, then the first thing that happens is those fabs explode. Either the Chinese will wreck them by accident on the way in or the Taiwanese government will do it to deny their usage to the Chicoms. No matter what happens there's a nonzero chance that many of the chips the world depends on would go offline for...years.

If Vietnam were in fact producing steel at five cents a ton, instead of the $800-900 per ton it costs to make it here, it's almost certainly not a smart decision to try to keep domestic producers alive.

See the above.

See if that stands up to the Freedom Caucus or DOGE. Government handouts to profitable ship-building companies? That's not MAGA. Get Musk's boys on them - delete, delete, delete!

You're trying to make this political. I'm thinking about 2027 and a very belligerent China.


So in that scenario, efforts to try to protect a steel industry that had been completely rendered irrelevant by whatever the Vietnamese discovered would likely leave the country worse off than just accepting the situation and stockpiling massive amounts of steel for defense purposes.


Until the Chinese flattened the Vietnamese steel industry and left the US with nothing, that is.

You're trying to make this political. I'm thinking about 2027 and a very belligerent China.

You can't separate them, though.

This is ultimately a political issue. Whether or not you support government policy to intervene in markets in order to ensure that certain industries are located in the United States is a "should" question, which involves political decisions.

It's easy to say that it's "unacceptable" for the U.S. to not be the location of any given industry, but that's very different from supporting the specific types of governmental policies that would be necessary to change that. Generally speaking, support for those policies lands more towards the left of the spectrum than the right. It's no accident that Freedom Caucus members like Jim Jordan and Andy Biggs and Chip Roy all denounced the very idea of the CHIPS Act - the core concept - as "crony capitalism" and opposed it. And that's probably the easiest example of this type of industrial policy: high-tech, highly-concentrated, and militarily important as well as economically important. But of the two bases, it was the progressive one that went all in on support, and the conservative one that opposed. Which is part of why this type of stuff doesn't happen in the U.S. enough to ameliorate your concerns - it took a Democratic trifecta to make it happen, because it matches up more with the progressive political philosophy than the conservative one.

Don't get me wrong - I would welcome if more conservatives would decide to support active and muscular governmental intervention in the economy if it is necessary to advance the collective interests of the nation, even if it requires spending a lot more government money. I just don't think there's as many takers on that side of the spectrum as you might think.

This is ultimately a political issue. Whether or not you support government policy to intervene in markets in order to ensure that certain industries are located in the United States is a "should" question, which involves political decisions.

Sure I can separate them. I don't accept the premise that the GOP is somehow all about total anarchy and everybody gets to do whatever they want but if they decide that there is a strategic need for the nation that they're somehow all a bunch of closet liberals. Nation-states must make decisions to survive.

But of the two bases, it was the progressive one that went all in on support, and the conservative one that opposed. Which is part of why this type of stuff doesn't happen in the U.S. enough to ameliorate your concerns - it took a Democratic trifecta to make it happen, because it matches up more with the progressive political philosophy than the conservative one.

The "progressive political philosophy" tends to be a) short sighted b) very anti-military c) more in line with the US as a World Citizen (as opposed to a Superpower with certain needs) and d) lacking in understanding that there are Bad Guys out there who, if allowed, would do things that we don't like.

Sure, democrats favor market intervention. They also tend to suck at it - witness Solyndra and the charging stations and High Speed Rail to Nowhere in California or many other bloated projects that cost way more than they should.

Don't get me wrong - I would welcome if more conservatives would decide to support active and muscular governmental intervention in the economy if it is necessary to advance the collective interests of the nation, even if it requires spending a lot more government money. I just don't think there's as many takers on that side of the spectrum as you might think.

There are those in the government and particularly the Pentagon that believe that 2027 is the year the balloon goes up. If you know where to look you'll see the feds talking about things that they normally don't say ANYTHING about because they're trying to send the ChiComs the DON'T DO IT message in subtle terms:

https://www.spaceforce.mil/News/Article-Display/Ar...

as one example, or

https://www.newsweek.com/china-satellite-dogfighti...
(The story here is that we know they're doing it and can see it)

or

https://breakingdefense.com/2025/03/secret-space-f...

Calling the project a “quasi-operational success,” Kelly Hammett, director of the Space Rapid Capabilities Office (SRCO), said in a briefing with reporters today at the AFA Warfare Symposium that “situational awareness indications and warning payloads” have been “collecting all kinds of very interesting data on the Chinese SOSI [Space Observation Surveillance and Identification System] network” — Beijing’s rough equivalent to Washington’s Space Surveillance Network.

The space-based monitoring technology was launched as payloads aboard Northrop Grumman’s LDPE-3A spacecraft in 2023, Hammett disclosed. The project was the first from the SRCO to enter orbit, and the Space Force said at the time [PDF] that the payloads would provide “enhanced situational awareness.”

(Openly discussing payload capabilities; normally they would say nothing). They NEVER talk about this stuff. Ever.

Then there's B-21 and NGAD
https://aviationweek.com/defense/aircraft-propulsi...

...and the CCA (Collaborative Combat Aircraft, also colloquially known as the 'Loyal Wingman' program):

https://www.msn.com/en-us/technology/aviation/air-...

Speaking of ships, the GOP is all on board with more of them:
https://news.usni.org/2025/04/28/reconciliation-bi...

The House and Senate Armed Services Committees want to pour billions into shipbuilding — including $1.8 billion for eight landing ships medium and $4.9 billion for unmanned vessels — as part of the Republican-led reconciliation bill’s $150 billion defense package, released Sunday.

The wide-ranging $33.8 billion shipbuilding portion of the defense measure includes $20.3 billion for 16 battle force ships, namely:

The ships are:

Two Flight III Arleigh Burke guided missile destroyers for $5.4 billion.
One Block VI Virginia-class nuclear attack submarine for $4.6 billion.
One San Antonio-class amphibious warship for $2.1 billion.
One America-class big-deck amphib for $3.7 billion.
Three John Lewis-class fleet oilers for $2.73 billion.
Eight Block I Landing Ships Medium for $1.8 billion.

BTW, you know what all those ships are for? They represent what an Expeditionary Strike Group looks like. This would basically be a new fleet meant to carry ~2,000 Marines. Extended ops in the Pacific...carrying Marines and F-35s. The America-class ships are essentially mini aircraft carriers.

The 3 fleet oilers tell you that somebody thinks there's a need to be at sea away from home ports for a while.

The GOP isn't going to hesitate to spend some money...

Don't get me wrong - I would welcome if more conservatives would decide to support active and muscular governmental intervention in the economy if it is necessary to advance the collective interests of the nation, even if it requires spending a lot more government money. I just don't think there's as many takers on that side of the spectrum as you might think.

Sorry about Biggs. I voted against him, but the district is a bunch of MAGA-people (and a Mormon Temple). Though I'm seeing fewer "Trump" flags lately (don't know if that's significant).

I agree with pretty much everything you've said about governmental intervention. Not only to provide things that are in the interests of the nation to keep at home (e.g. high tech, PPE manufacture, and some heavy industry), but also intervention in the form of controlling corporations. The overturning of Chevron is a major blow to that. The only entity that can reign-in corporations is the government. Without that, it's a race to the bottom in terms of health and safety (both consumers, and workers).

The semi company I worked for ended up buying companies that had some military contracts. I heard at work that one issue -from a corporate standpoint- is that if the government/military needs you to produce more of whatever you contracted, they could force you to cease all other activities to produce just that chip. Not sure if it was true, but likely it was since I heard it from a senior QA person. So, not only do you want domestic manufacture, but you need to have companies contracted for production. I don't think the above scheme would work if you approached a non-contracted company and said "you're going to make this for us now".**




**Nevermind the issues with MIL spec adherence, which approved contractors are supposed to have incorporated already.

Until the Chinese flattened the Vietnamese steel industry and left the US with nothing, that is.

ROFLMAO !! Never happen.

To get to a massively CHEAP steel production level would require technology that could not be hidden or realistically patented to get protection of the tech/process. Thus, the manufacture of steel worldwide would become minimal for everyone. National Security....

And by the way, when you buy stuff from China? You get lots of extras sometimes:

https://www.msn.com/en-ca/money/topstories/rogue-c...

LONDON (Reuters) -U.S. energy officials are reassessing the risk posed by Chinese-made devices that play a critical role in renewable energy infrastructure after unexplained communication equipment was found inside some of them, two people familiar with the matter said.

and

Power inverters, which are predominantly produced in China, are used throughout the world to connect solar panels and wind turbines to electricity grids. They are also found in batteries, heat pumps and electric vehicle chargers.

While inverters are built to allow remote access for updates and maintenance, the utility companies that use them typically install firewalls to prevent direct communication back to China.

However, rogue communication devices not listed in product documents have been found in some Chinese solar power inverters by U.S experts who strip down equipment hooked up to grids to check for security issues, the two people said.

Over the past nine months, undocumented communication devices, including cellular radios, have also been found in some batteries from multiple Chinese suppliers, one of them said.

This isn't new. They do this all the time:

https://www.bloomberg.com/features/2021-supermicro...

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