Source: Isonomia Quarterly
by Derrill Watson
“I found myself bothered recently by a Noah Smith substack post making the case that tariffs and industrial policy can be successful in increasing US manufacturing. To the extent his point is to counter ‘a natural skepticism’ that America doesn’t and can’t produce physical goods, I guess this is a harmless and obvious enough point to make. He cites evidence that tariffs and industrial policy have worked to increase production in solar panels, semiconductors, and batteries. … The theory of trade based on comparative advantage does not claim that reshoring is impossible. It does agree that tariffs and subsidies make us all poorer, but not that they can’t successfully increase production in the areas being protected.” (06/13/25)