Better in their words…

https://twitter.com/shellenberger/status/1907941209177468978

Michael Shellenberger

@shellenberger. April 4, 2025

Over the last decade, a consensus has grown on the Left and Right that the US needs to be more self-sufficient when it comes to manufacturing. During Covid, we discovered we didn’t make much of the equipment we needed to deal with a pandemic and were thus dependent on other nations, and so Congress passed and Trump signed the CARES Act in part to spend money to support domestic manufacturing of medical supplies.

In 2022, a bipartisan majority in Congress passed the CHIPS Act to bring semiconductor manufacturing back to the U.S. out of the recognition that we had become dangerously dependent on foreign nations for microchips, which have become general-purpose technologies, necessary for national security, and upon which the AI revolution will be built. Where America had a $38 billion trade surplus in 1991 on advanced technology manufacturing, today it has a $299 billion deficit.

Liberals and conservatives, Leftists and Rightists, have long shared a broad agreement that manufacturing and its knock-on industries are an essential source of employment for non-college-educated working-class people, and that the loss of manufacturing contributed to social fragmentation, family breakdown, and the drug addiction and death crisis. In a 2024 survey, Americans agreed ten to one that “we need a stronger manufacturing sector; 47% said America suffered from globalization, while 33% said it benefited. It is partly for that reason that Joe Biden, in perhaps the most bipartisan and non-ideological decision of his presidency, kept in place the tariffs imposed by Donald Trump during his first term as president. And yet both liberals and many conservatives are reacting with outrage as President Donald Trump puts in place precisely the trade tariffs needed to reduce our dangerous dependency on other nations and increase our manufacturing of the goods we need for national security, economic security, and societal wellbeing. The China tariffs, the CARES Act, and the CHIPS Act did not result in the return of much manufacturing, much less the rebalancing of trade. Total manufacturing jobsare 12.8 million in December 2019 and are 12.8 million today.

The US still depends on China and other nations for active pharmaceutical ingredients, personal protective equipment, microchips, and critical minerals. Suffice to say, we are a very long way from a manufacturing renaissance sufficiently robust to revitalize the communities that have lost good, high-wage jobs to China and other competitors and even rivals internationally. The reason is clear. The average tariff level globally is 6.7% compared to America’s 2.7%. And simply subsidizing industries may not be enough for two major semiconductor manufacturers, Intel and TSMC, to produce domestically without tariffs.

US President Donald Trump delivers remarks on reciprocal tariffs during an event in the Rose Garden entitled “Make America Wealthy Again” at the White House in Washington, DC, on April 2, 2025. Trump geared up to unveil sweeping new “Liberation Day” tariffs in a move that threatens to ignite a devastating global trade war. Key US trading partners including the European Union and Britain said they were preparing their responses to Trump’s escalation, as nervous markets fell in Europe and America.

Anti-tariff liberals and conservatives say Trump’s actions will destroy people’s retirement savings by crashing the stock market, and will undermine the comparative advantage of other nations producing products we shouldn’t. And, they say, our goal should not be to return manufacturing to the United States, except for a few exceptions, which Congress has already made. For centuries, economists have argued that some nations, such as poorer ones, are more suited to produce many products than richer ones. Americans making t-shirts at $20 per hour are less efficient than the Vietnamese making them for $3 per hour. And the US should not be trying to replace perfectly reasonable products to import, like aluminum from Canada, which we have no reason to ever go to war with, and which has access to cheap hydroelectricity to make it. Over half of American families have money in the stock market, and they will all suffer, anti-tariff liberals and conservatives say.

The economic system we have had since World War II has worked to maximize win-win relationships that result in poorer nations climbing the development ladder with manufacturing and wealthier nations like the US focused on services. But it’s unwise to evaluate policies based on the short-term impact of the stock market. Anti-tariff voices grossly overstate the comparative advantage when it comes to manufacturing, and the postwar system, economically and militarily, is no longer in the interests of non-college-educated Americans, who are both more vulnerable and more numerous than the college-educated elite. There is no need to bring back a significant amount of low-skill and nonstrategic manufacturing like T-shirts, and Trump has not advocated that. America may need to bring back some low-skill jobs, such as manufacturing protective gear. But our priority should rightly be high-skill manufacturing, and CARES, CHIPS, and the Trump-Biden China were, obviously, not enough. It may be fine to rely on Canada for aluminum.

But the tariffs against it and Mexico, as well as Trump’s stated desire to make it the 51st state, should be viewed as the president negotiating in preparation for upcoming trade talks between the three countries. While offshoring manufacturing policies benefited multinational corporations, bankers, and consumers, they often devastated communities built on manufacturing, mining, and manual labor. US companies moved production to countries with lower labor costs, fewer regulations, and subsidized exports. Economists calculate that just the so-called “China Shock,” that country’s entry into the World Trade Organization, alone cost the U.S. 2.4 million jobs and had ripple effects across entire communities. The average manufacturing wage is $103,000 per year compared to $37,000 per year for the average service sector wage. And where a service sector job supports 2 to 3 jobs, a manufacturing job supports nine jobs. Continuing with a system that is fundamentally advantageous to a minority of the country and disadvantageous to a majority is not sustainable and unwise to prop up. Trump’s trade actions are part of a broader return to nationalism underway globally, and they can’t be understood on economic grounds alone.

Regarding priorities, we should put the two-thirds of the country that is non-college educated working-class ahead of the 50% of the country who own stocks, for moral and democratic reasons. America is deeply divided. While there are many proximate reasons for this, including geographic sorting, cable TV, and social media, the underlying reasons are economic. The gulf between the educated elites and the non-educated working class has grown dangerously large. Many critics of the tariffs are well-intentioned. They are right to worry that they could come with significant economic costs and disruption. The concern of many of them is genuinely for the working class and poor, who higher prices for imported goods would most harm.

However, many American elites today identify more with their global counterparts than their fellow Americans. And that’s a huge problem. In his study of 21 civilizations, British historian Arnold J. Toynbee found that civilizations collapse not simply from external invasion but from internal decay, precisely when their elites stop identifying with the people. “Civilizations die from suicide,” he famously wrote, “not murder.” Civilizations all depend on their elites, Toynbee noted, or the people he called the “creative minority.” But rising success creates decadence, complacency, and eventually contempt toward their people, and they start to identify with elites in other nations.

This is all a natural outgrowth of trade, cosmopolitanism, and snobbery. It starts to view the ordinary people as “deplorables.” At this point, the elite lose their creativity and become simply the “dominant minority,” one that rules no longer by example but rather by manipulation or force. Toynbee could be describing America in the 21st Century. College-educated elites look down on the American working class and identify with other professional and managerial elites in Europe and other nations. They sympathize less with the low-skilled American citizen born here and more with the low-skilled foreign migrant here illegally. Such elites are more concerned with tariffs’ impact on their stock portfolio and the cost of their gadgets than they are with the downward pressure illegal migrants put on wages or with how nations manipulate their currency to retain manufacturing. Toynbee said that, at this stage of development, a nation’s elites become “parasites or renegades,” alienated and contemptuous toward the culture that produced them. Civilizations at this late stage are morally hollow and thus fragile and prone to abuses of power, like censorship, lawfare, and the weaponization of government agencies.

And these civilizations disparage their traditions in ways that the American elites have disparaged America’s founding and its history as essentially evil, due to the unavoidable tragedy of indigenous genocide and slavery, even though a civil war that killed over 600,000 people was fought to end it. But Toynbee didn’t believe that civilizational collapse was inevitable; some societies can snap back…. Please subscribe now to support Public’s award-winning reporting, read the rest of the article, and watch the full video!