The Realignment 554 | Ian Fletcher: Why Industrial Policy and Managed Trade Are Key to America's Future
May 27, 2025
Ian Fletcher, co-author of *Industrial Policy for the United States*, dives into the crucial role of industrial policy in America's future. He critiques the rise and fall of free trade orthodoxy while discussing necessary government interventions in key sectors like electric vehicles. Fletcher argues for a managed trade approach to bolster essential industries and addresses the need for revitalizing American manufacturing. He emphasizes how strategic policies can enhance national resilience and ensure good jobs in a competitive global landscape.
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Industrial Policy Includes Trade Tools
- Industrial policy means government interventions to secure industries vital for prosperity and security.
- Trade policy tools like tariffs are part of this to manage rather than pursue pure free trade.
Open Managed Trade Not Free Trade
- "Free trade" as currently discussed often means managed trade with exceptions.
- True free trade cannot selectively exclude or include certain imports or exports.
Pre-Trump Economy Practiced Free Trade
- Before Trump, U.S. had very low tariffs and large trade deficits, practically free trade.
- Economic decisions were based on comparative advantage, but these theories have flaws.
