President Donald Trump is not the first prominent American politician to demand that the federal government take partial control of Intel and other manufacturers of advanced computer chips.
But it might surprise you to learn whose idea he has embraced.
During debate over the CHIPS and Science Act, the 2022 bill that ultimately delivered $52 billion in subsidies to chipmakers, Sen. Bernie Sanders (I–Vt.) floated the very same idea that Trump is now pursuing: that the government ought to have a stake in those companies.
In a July 2022 statement, Sanders explained that he was opposed to the CHIPS Act, which he viewed as a “bribe” being paid to tremendously wealthy companies that had no need for a government handout. (On that point, he was not wrong.)
Sanders, like Trump, said he viewed the chip companies as being essential to national security. But he refused to vote for the bill unless the subsidies came with some serious strings attached. Among them: “Companies must agree to issue warrants or equity stakes to the federal government.”
Bloomberg shares this distressing reality about Trump’s economic interventionism:
“It’s state direction that we haven’t had in the US,” Gary Hufbauer, a senior fellow at the Peterson Institute for International Economics, said, “it’s very much the Chinese model making its way into US government.”
Joe Biden’s industrial policy for electric motorcycles failed.
This new “conservatism,” while not exactly progressivism, is still a recognizable cousin of the left-wing antitrust theories that prevailed during the Biden administration. Both seek to expand the remit of antitrust enforcers from a narrow one, focused on combating economically anticompetitive behaviors, into something much broader: using antitrust to centrally plan markets to further the planner’s political, social, and economic goals.
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If “America First Antitrust” counts as conservative, it is not an American conservatism but a European one. As Friedrich Hayek put it, the European conservative harbors “fondness for authority” and a “lack of understanding of economic forces.” Although not blind to the potential—nay, likely—problems that attend innovation and change, the American conservative trusts in the largely unmanaged, undirected choices of individuals and institutions of civil society and the market to produce virtue, prosperity, and flourishing better than any state or statesman ever could. American history vindicates this confidence. “The conservative feels safe and content only if he is assured that some higher wisdom watches and supervises change, only if he knows that some authority is charged with keeping the change ‘orderly.’” Hayek wrote. Adam Smith had similar ire for those he dubbed “men of system.”
Attracting global talent is not China’s strength—the world’s best would rather join the United States. But if America abandons the openness that has long underpinned its exceptionalism, it will squander one of its biggest advantages and decline into a second-rate power.
A new Richmond Fed study, “Five Decades of Decline: U.S. Construction Sector Productivity,” finds labor productivity in construction has fallen more than 30 percent since 1970. Over the same half-century, overall US productivity doubled.
“It turns out that rich people in the Hamptons can fund their own art museum grants.” A slice:
Let’s say you wanted $140,000 to fund an art education program for people with dementia and special needs at a museum in the Hamptons on Long Island. How would you go about doing it?
You could, as has been the practice for many years, get a grant from the federal government. That grant is funded by some combination of tax revenue and borrowing, spreading the $140,000 in costs very thinly over the U.S. population. Random people from Winston-Salem to Walla Walla each contribute some fraction of a penny to the program without realizing it. They also fund thousands of other grant programs in communities around the country without realizing it. The money comes with a bunch of strings attached about how it can be used. You have to do a bunch of government paperwork to prove to faraway bureaucrats that you are spending the money in accordance with their rules. Now, with Republicans in Washington, D.C., targeting grant programs like this one for cuts, you have to wonder whether the money will be there next year.
Or, you could look around, realize you’re in the Hamptons, and just ask the rich people who live there for some money.
That’s what the Parrish Art Museum did this year, according to reporting from the New York Times. “Federal support for the arts has become unreliable, and tapping just a little bit more of the immense wealth in the Hamptons could make or break an institution,” the story says.
