Paul Mueller critiques industrial policy's resurgence, noting proponents conflate it with pro-market growth. He argues government direction leads to overproduction and resource misallocation, referencing China's EV troubles.

Well, thank you for having me, John.

I appreciate it.

Uh, this book, it, it's an impressive book.

I mean, the authors have done their homework.

It's wide-ranging.

It goes in depth.

It offers, uh, a number of, uh, provocative arguments, at least as a free market economist, I find them provocative.

Uh, and I think it's gonna be around for a while and it's worth studying, uh, just to think through serious challenges to what some t- call the, the neoliberal consensus or classical liberal views on free trade and free markets.

I find it ultimately unpersuasive in a number of, of regards, but it's an important book and it's a book for our moment, and I think that it will likely get a lot of traction among policymakers in DC who have begun to, um, play around with industrial policy again.

We're seeing a resurgence, uh, politically of this.

You know, on the left, there was always this element.

On the right, this was sort of downplayed in the years of Reagan and Thatcher into the '90s and 2000s.

But this desire to fix the economy, to direct the economy, to create a certain kind of economy that, uh, policymakers think is best, that, uh, impulse is, is back and we're seeing some of the fruits of that in, uh, the US today.

You've done us the great favor of quoting Adam Smith in your essay, which I found after reading some of the arguments by the authors and the idea of industrial policy, it was very helpful to go back to the beginning of Adam Smith's observations.

I read in part, "The statesman who should attempt to direct private people in what manner they ought to employ their capitals, would not only load himself with a most unnecessary attention, but assume an authority which could safely be trusted to no single person whatever, and which would nowhere be so dangerous as in the hands of a man who had folly and presumption enough to fancy himself fit to exercise it." Wonderful.

Wonderful roundabout way of saying, okay, show me the example and I'll show you the failure.

Uh, Paul, let's go to what we have right now for industrial policy arguments.

Not the super planning of rebuilding an economy after a war, that was Germany and Japan.

Nor building an economy from the scratch of agricultural centuries, that was the People's Republic of China, and still I understand there are 300 million people in China who live in that kind of poverty today.

Let's talk about what we do in the United States, a heavily industrial and successful country.

The news most recently, NVIDIA, the most, uh, valuable country on Earth, and exceeding- approaching 4.5 trillion, agreeing first, to share profits in some fashion with the United States government, and second, to invest in companies that are part of the plan of the Trump administration to fix microchip manufacturing in the United States, in our borders, and not have to depend upon the vulnerable Taiwan.

Does that qualify as industrial policy or is that fancy around the edges?

Huh.

It's certainly related, for sure.

And, and the desire to re-shore various kinds of industries, chip manufacturing and others, is, is part of this industrial policy.