Bernie’s Right: Corporate Welfare Is Not Industrial Policy

An interesting discussion from the socialist Jacobin channel, including a speech from Bernie Sanders in Congress in the wake of the CHIPS Act, which authorizes $280 billion in federal funding to promote domestic semiconductor production. I also think Bernie is right on this, that governments wanting to promote domestic industry via an industrial policy should be attaching strong conditions to the support they provide, whether fiscal, regulatory or otherwise. If they fail to do so, companies may end up sustaining the status quo or simply wasting it. There are some conditions attached in this particular case, but the arguments in the video suggest that these may be insufficient. The history of successful industrial policies in East Asia and elsewhere shows that the balance of power between the state, business, and other groups in society is important in driving outcomes, as is the role of institutions more generally. Worth a watch.

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