Wednesdayâs âmust watchâ House Judiciary hearing with the CEOs of Amazon, Apple, Facebook, and Google raised a host of questions, including what the goal of antitrust should be (maximizing economic welfare or other goals, like protecting small business), and how should we think about platform industries.
Over the last several decades a major shift has occurred in how many U.S. elites â pundits, advocates, policy makers, and others â think and talk about corporations. For much of the 20th century most elites viewed corporations as an institutional tool by which America could best achieve its most important economic goals: innovation and increasing living standards. To be sure, there would always the occasional Enron or Tyco scofflaw, but these were seen as the exception, to be prosecuted and shunned.
With surging COVID-19 cases in many parts of the country and a widely available vaccine months awayâand with consumer and investor confidence and spending likely to be weak even with a vaccineâthe odds are quite high that economic recovery will be long, drawn-out, and weak. As such, Congress is rightly debating a fifth economic recovery package.
The partisan rancor in Washington is worse than any time in the last century. But surprisingly when it comes to economic policy, both parties share a common view: policy neednât be concerned about enterprise capabilities.
One of the few times when I have found myself in agreement with Paul Krugman is when he famously wrote, âProductivity isnât everything, but in the long run it is almost everything.â Yet, today, this statement is not only passĂŠ, but downright suspect, at least among many U.S. elites. For in a world characterized by neo-Luddite fear of new technologies and outlandish claims that technology will destroy most of our jobs, public and elite opinion has shifted to a view that âproductivity is almost nothing, especially if any worker loses their job from it.â
ITIF recently released a report about how “innovation mercantilist” policies were instrumental in enabling China to dominate the global telecom equipment industry, and how that rise came at the expense Read more…
A Response to Willy Shih
A tax credit for domestic investment is the best way to reduce production costs.
It has become bipartisan sport to attack âBig Techâ, but most of the ire is directed at âBig Internetâ: consumer-facing Internet companies like Amazon, Google, Facebook, Twitter, and Uber.
German philosopher Hegel postulated that history progresses through thesis, antithesis and then synthesis. Today we are seeing the first two dynamics with trade policy and attitudes towards globalization; we desperately need the third.
This seems like a strange headline given that the economy has recently shed almost 40 million jobs. But at some point with the development of a vaccine or an effective treatment, the economy will come back to normal.
Daniel Moynihan once stated that âEveryone is entitled to his own opinion, but not his own facts.â This is no more true than with todayâs debate over the health of U.S. manufacturing; a debate that is critical to get right if policy makers are to respond appropriately.
Chinaâs economic rise and the damage inflicted on U.S. industry has been a wakeup call to many U.S. policymakers. But most conventional economists continue to hold firm to their ideological notion that only the market can respond, and that any more proactive government action, particularly focused on key sectors or technologies, is doomed to fail.
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