Protectionism Isn't Outside The American Mainstream— The Kind Of Fascism Dominating The GOP Still Is

For Republicans, It's Trump First— America... Maybe

"The Dream" by Nancy Ohanian

Campaigning in Pittsburgh yesterday, Kamala came out against allowing Japan’s biggest steelmaker, Nippon Steel, to buy US Steel. For the $14 billion deal to close, it would have to approval from the Justice Department’s anti-trust division. Joining Democratic senators John Fetterman (PA) and Sherrod Brown (OH) who have come out publicly against the sale, are reactionary Republicans Josh Hawley and… JD Vance (before Peter Thiel bought him the GOP running mate slot).

In the House, though, this is China Week and they’re more worried about what China is trying to buy up than what Japan is. Yesterday, Jake Sherman and John Bresnahan reported that even when it comes to national security, the Republicans are incapable of thinking beyond narrow partisan advantage and ideology. “House Republicans,” they wrote, “are trying to make September about unifying GOP lawmakers and dividing Democrats. To that end, the House Republican leadership is quietly planning a week focused on curbing what they see as an existential threat from China. This themed week has been discussed inside the Republican leadership for some time. But it’s now September and there’s not much political safe ground for the four-seat GOP majority other than rapping on geopolitical enemies.” 

So MAGA Mike and his team have two dozen bills they want to bring up under suspension of the rules, meaning they’ll need a two-thirds vote to pass, not a way to actually pass the bills as much as a way to stoke Democratic disunity. Some of the legislation is sound and some is MAGA-bonkers, like Tom Tiffany’s kooky No WHO Pandemic Preparedness Treaty Without Senate Approval Act designed to make any World Health Assembly agreement on pandemics subject to a Senate vote— not really much to be with China, but something to please the paranoid QAnon crowd that has become a major part of the Republican Party coalition. Just look at the cosponsors: all the freaks and nuts, from Little Miss Beetlejuice (R-CO), Ronny Jackson (R-TX), Andy Ogles (R-TN), Chip Roy (R-TX), Diana Hashbarger (R-TN), Bob Good (R-VA), Mary Miller (R-IL) and Troy Nehls (R-TX) to the two neo-Nazi science deniers from Arizona, Paul Gosar and Andy Biggs.

Dan Newhouse’s Protecting American Agriculture from Foreign Adversaries Act, meant to make it harder for foreign nationals to buy American farmland, has a lot wider support. West Virginia Republican Carol Miller’s End Chinese Dominance of Electric Vehicles in America Act bars individuals who have electric cars with batteries made from “prohibited foreign entities” from getting clean vehicle tax credits; Texas Republican August Pfluger’s DHS Restrictions on Confucius Institutes and Chinese Entities of Concern Act bars DHS from giving funding to a university that receives funding from the Chinese government; and another Texas Republican, Lance Gooden has a bill, The Protect America’s Innovation and Economic Security from CCP Act to reestablish a China-focused division in the Justice Department.

Yesterday, Noah Smith noted that China built up a manufacturing capacity stronger than our own while Bush, Obama and Trump failed to address the problem. Biden, on the other hand, “made a serious attempt to do something about America’s industrial weakness vis-a-vis China,” especially, though not exclusively, in high tech manufacturing.

“Frustratingly,” wrote Smith, “this progress has been mostly ignored by the national political conversation, even though it’s one of the most important things that the American government is doing… after so many years of inaction.” He credits the Biden-Harris administration with a coherent industrial policy that has be cognizant of the dangers posed by Chinese military aggression and by Climate Change. 

Semiconductors are a crucial input into every form of military technology, and high-end semiconductors will be crucial for the autonomous weapons that are expected to take over the battlefield in the coming years. Green energy— especially solar power and batteries— are crucial in the fight against climate change, but batteries are also the power source for FPV drones, which are becoming the indispensable weapon of the modern battlefield. Energy in general is also an input into every technology, so having U.S. energy supplies dependent on Chinese production is a bad idea.

Thus, Biden’s two big signature industrial policy bills— the CHIPS Act and the IRA— address semiconductors, batteries, and solar power.

So far, both bills have achieved an important result: For the first time in decades, America is now building factories at a rapid rate. Now, it’s important to realize that building factories is different than producing actual stuff. Factories, once built, can sit idle if there’s no demand for their products, or if they can’t find sufficient workers. So there’s no guarantee yet that Biden’s industrial policy will succeed at cranking out actual chips and batteries— it’s just too early to tell. But the factories are getting built, and that’s about all we could hope for at this point. Take a look at this graph showing spending on factory construction in the U.S.

Smith also urges his readers to notice what types of factories the Biden-Harris administration has helped underwrite once Trump was kicked out of the White House. “It’s practically all in the ‘computer/electronic/electrical’ category, which includes both semiconductors and batteries— the two main things Biden subsidized. And there’s a smaller bump in the ‘transportation equipment’ category, which mainly means cars— which the IRA also subsidizes… Biden’s industrial policies have created a massive boom of private manufacturing investment in the most strategic industries. In fact, the amount of private investment utterly swamps the amount of actual government spending commitments... The revival of American manufacturing is being prompted by the government but not bankrolled by the government. A small injection of subsidies is really all it took.”

He also noted that “Another big piece of Biden’s plan to establish a U.S. industrial edge over China is export controls on chips and chipmaking equipment. Unlike industrial policy, this isn’t the kind of thing that will create American jobs (although it may preserve a few). It’s a destructive policy, aimed at keeping China a step behind the U.S. and its allies when it comes to the all-important autonomous weapons race, and hopefully in the area of precision weaponry in general.”