Why should we believe that this boondoggle will produce better results than hundreds of other corporate welfare programs?
by Veronique de Rugy
Reason.com
Another week, another reminder that heavy-handed government industrial policy is in fashion. Nobel Prize-winning economist Michael Spence recently endorsed it as embodied in the newly passed “CHIPS+” legislation, an attempt to bolster America’s semiconductor industry. The endorsement, like so many, rests not on evidence or economics, but on blind faith in Congress and President Joe Biden’s administration.
Spence writes that “the infrastructure bill, the CHIPS Act, and the [Inflation Reduction Act] amount to a stunning increase in long-term investment in America’s growth potential, and in balancing out the various dimensions of its growth pattern, prominently for carbon dioxide emissions reduction and sustainability.”
In other words, these new expenditures—amounting to more than $1 trillion—spent by the same government that can’t deliver the mail efficiently or run trains for a profit are supposed to generate the advertised abundance of goodies. We’re to trust that these monies, disbursed by the same administration that botched the withdrawal from Afghanistan, will achieve only successful results.