Economists, industry leaders, and policymakers explored the current debates over industrial policy—the strategies a government takes to stimulate economic growth through tools like subsidies, tax incentives, or trade barriers—and its relationship with economic security at a recent campus convening.
The conference, hosted by the Mossavar-Rahmani Center for Business and Government (M-RCBG), ranged from lessons from past industrial policy decisions to questions about Chinese-U.S. competition, what national security aims might be at stake and more. The activities kicked off on Tuesday evening with a John F. Kennedy Jr. Forum on industrial policy and security with former United States Secretary of Commerce Gina Raimondo and Lawrence Summers, M-RCBG faculty director and Charles W. Eliot University Professor.
On Wednesday, policymakers, industry leaders, and academics joined Summers, M-RCBG center co-director John Haigh and Chris Miller, a professor from Tufts’ Fletcher School and author of “Chip War: The Fight for the World’s Most Critical Technology,” for a full day of public panel discussions. Issues related to industrial policy, Miller explained, are “much in the news, but poorly understood” and emphasized that economics and security goals are intrinsically linked.
Catch some takeaways from the speakers below—or watch the panels.
The telecom industry, semiconductors, and aviation
Experts from academia, government, and industry talked through the pros and cons of industrial policy in big industries including telecommunications, semiconductors, and aviation, as moderated by John Haigh and focusing on the role of government in supporting national champions, particularly failing ones.
Jonathan Pelson, author of “Wireless Wars: China’s Dangerous Domination of 5G and How We’re Fighting Back” argued that China’s industrial policy is more akin to “national security by other means” than trade. “Any discussion of industrial or economic policy needs to be held in the context that accounts for the difference between business and war, between industrial policy and national security,” Pelson said. He described industrial policy as a security strategy since countries are using it to achieve geopolitical means and used the telecom industry as an example.
Mike Schmidt, former director of the CHIPS Program Office, talked about U.S. manufacturing and the CHIPS and Science Act, which invested in the research and manufacturing of semiconductors. Schmidt argued that the United States should sustain demand for at least two related manufacturing ecosystems and “sustain and grow leading process technology in the United States.”
And Richard Aboulafia, a professional from the aviation industry, discussed innovation and policy in his industry, saying Boeing has “stumbled” in the past few years, but is doing fine attracting capital. He said, “everything that made this industry great depends upon multilateral treaties and institutions.”
