Every year, there are many more airplanes manufactured in the United States than the country’s domestic airlines can use.
This is a rather straightforward fact, but it has some important ramifications for the Trump administration’s trade policies, so bear with me for a moment. During 2025, for example, Boeing churned out 600 commercial airliners from its assembly facilities in Washington state and South Carolina. Many of those planes were sold to foreign airlines and exported.
Last year was no outlier: The U.S. routinely exports billions of dollars worth of commercial aircraft and airplane equipment. We make more than we can consume, and we sell the rest to businesses in other countries. This excess manufacturing is not a problem. On the contrary, this is tremendous news for the workers at Boeing and for the company’s shareholders. It’s also great for those foreign buyers—airlines can purchase Boeing planes without first needing to develop a local airliner-production industry.
On the other hand, if America were limited to producing only as many airplanes as it could consume domestically, Boeing’s workers would have less to do, make fewer sales, and probably earn lower pay. Boeing’s shareholders and those foreign airlines would be worse off too. Everyone involved would be poorer.
But the same excess manufacturing capacity that makes Boeing a global leader in airplane production is now becoming a boogeyman for the Trump administration—at least when it is businesses in other countries that are doing it.
Their proposed legislation would inhibit government “jawboning,” defined (by Merriam-Webster) as “the use of public appeals (as by a president) to influence the actions especially of business and labor leaders.” The adjective “public” is underinclusive. One of the senators’ objectives is transparency about hitherto secret pressure.
During the pandemic, executive branch officials in the Biden White House, FBI and elsewhere frequently hectored social media platforms (YouTube, Facebook, Twitter) to adopt particular policies of “content moderation.” In plain language, censorship was the officials’ goal and, often, their achievement. (During the 2020 presidential election, the platforms also, absent government pressure, censored speech about Hunter Biden’s laptop.)
The Biden administration thought that content on the platforms was promoting “vaccine hesitancy” and doubts about “social distancing” and shutdowns generally. The officials wanted to suppress theories about covid-19’s origin (the lab-leak theory, now widely considered plausible). Two states and five individual social media users sued dozens of executive branch officials and agencies, seeking an injunction against them for pressuring the platforms to violate their speech rights by removing, obscuring or otherwise discriminating against their posts.
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The Cruz-Wyden bill is a response to executive misbehavior, and to judicial judiciousness, that requires Congress to legislate. Their bill affirms the principle that the government may not do indirectly (e.g., censor speech) what it is forbidden to do directly. The bill:
Would require government to make public certain kinds of communications with social media companies, artificial intelligence companies and broadcasters. And would establish that plaintiffs must prove only that government attempted censorship, not that its pressure by itself succeeded. And would provide for money damages, instead of mere injunctions, for plaintiffs when an offending official left office while a case wended its way through courts.
So, crude and sneaky overreaching by the executive was followed by the Supreme Court’s austere (and reasonable) refusal to overreach by ignoring principles of standing. This has prompted two lawmakers to respond. If Congress makes that response a law, there will have been a minuet of actions and reactions driven by each branch’s prerogatives, responsibilities and incentives. The separation of powers will have functioned as intended.
For many, economic growth and environmental protection exist in direct tension. People with this belief generate policy proposals to permit growth while protecting the environment. For others, the tension is irremediable — they believe growth necessarily destroys. For these zealots, degrowth is the only way. For both groups, liberalizing the economy — allowing for more economic growth — carries at least a risk of environmental degradation.
In recent work with Justin Callais and Alicia Plemmons, published in Structural Change and Economic Dynamics, we show that there is no reason to worry. We used 49 cases of sustained economic liberalization since 1970 and measured their effects on outcomes such as death rates from air pollution, total greenhouse gas emissions, as well as emissions per capita and per dollar of economic output. In this context, liberalization refers to the adoption of policies that promote international trade, secure property rights, and lessen fiscal and regulatory burdens.
Comparing with similar countries that did not liberalize, we found that while GDP per capita increased 16 percent within ten years for liberalizers, environmental outcomes did not deteriorate. In fact, we found that death rates from air pollution declined modestly, while there were no effects of liberalization on total greenhouse emissions. Moreover, post-2000 liberalizers actually showed signs of lower emissions per dollar of economic activity and capita.
What if the U.S. government decided it could award itself half your house without compensation? Nobody would ever invest in a house again. That’s the Bernie Sanders plan for AI, seizing half the industry’s investment without paying a cent.
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Anthropic founder Dario Amodei warns incessantly about a Chinese AI threat even as his company attracts a trillion-dollar valuation that makes sense only if it will be free to commercialize its innovations rather than see them absorbed into an all-embracing military-cyber-industrial complex.
Geitner Simmons tweets: (HT Scott Lincicome)
It’s extraordinary to see the federal government, with congressional acquiescence, leap into long-term ownership of private industry. I realize the administration is obsessive about maximizing its ability to exert “leverage” on every front it can (hence these equity stakes not only in the defense sector), but this calculated erosion of the government/private spheres is harmful economically, especially for the long term.
