Industrial policy involves government supplanting society’s myriad private collaborations — i.e., market transactions — to allocate resources and opportunities as government thinks best. Such policy empowers government, which is politics in every fiber of its being, to supplant markets in shaping the future, deciding which industries and products should prosper. [Sen. Wesley] Jones wanted Washington state’s shipping industry to prosper, with the help of the other Washington. He particularly wanted to protect his state’s shippers from foreign competition serving ports in Alaska — over Alaska’s strenuous objections.
The Jones Act today requires that cargo transported by water between U.S. ports must travel in ships that are U.S.-flagged and are at least 75 percent U.S.-owned and -crewed. The ships also must be assembled entirely in the United States, with all major components U.S.-fabricated. Passed immediately after one war, the act was rationalized by anticipation of another. Supposedly protecting the domestic shipping industry from foreign competition would stimulate merchant marine shipbuilding sufficient for military emergencies. Predictably, however, protecting the shipping industry from competition increased costs of shipped goods (costs passed along to U.S. consumers), decreased pressure for efficiencies and contributed to the shrinking of U.S. shipbuilding.
Colin Grabow and Scott Lincicome of the Cato Institute  report that two years after the Jones Act was passed, a government report found that a U.S.-built ship cost 25 percent more than a comparable vessel built abroad. And after a century of the act? “A U.S.-built tanker costs 300 percent more than one built abroad while a U.S.-built containership has a price premium of 400 percent.” U.S. shipyards have collectively produced fewer than three a year since 2000.
The best way to understand why is by invoking an analogy about thermometers and temperature that Milton Friedman employed when inflation was a big issue during the 1960s and 1970s. Prices function somewhat like a thermometer inside your house. They indicate the point where the quantities that producers are willing to supply to the market match the quantities consumers demand, based on their available budget. Monetary policy for its part, is the thermostat. If the thermometer says that the temperature is going up, it’s either because there are changes in the economy in general (i.e., the outside temperature) or because someone turned up the thermostat. Sometimes, it can be a mixture of both factors (i.e., loose monetary policy and supply shocks occurring simultaneously). Distinguishing between them is not an easy task. People who propose to impose price controls are essentially trying to break the thermometer by preventing it from showing the rising temperature and claiming the problem is solved.
The government regulator, the Canadian Radio-television and Telecommunications Commission (CRTC), announced on Friday that it would require registration by independent content producers, including online news companies and “individuals that host podcasts on their own websites.”