Colin Grabow of the Cato Institute is reporting that the United States remains a manufacturing powerhouse. He writes:
It has become conventional wisdom among many in Washington that a once‐vaunted US manufacturing sector has become a shell of its former self. Language used by members of the commentariat and politicians to describe the state of US industry is often bleak, sometimes bordering on the apocalyptic. In August, for example, columnist David Brooks flatly stated “we don’t make things anymore.” Talk of rescuing the so‐called “Rust Belt” and American manufacturing have been staples of recent presidential campaigns, and once in office President Biden and President Trump have both pushed a spate of protectionist measures to resuscitate the allegedly beleaguered sector.
But aside from the economic harm inflicted by such actions, the underlying premise that American manufacturing needs saving doesn’t square with the facts. As I explain in a new essay, reports of the sector’s demise are greatly exaggerated—if not entirely fictitious.
Simply put, the United States remains a manufacturing powerhouse. In 2020 it was the world’s fourth‐largest steel producer and in 2021 was the second‐largest automaker and largest aerospace exporter. Accounting for nearly 16 percent of global manufacturing output in 2021—second only to China, which has four times the population of the United States—the US had a greater share than Japan, Germany, and South Korea combined. By itself, the US manufacturing sector would constitute the world’s eighth‐largest economy. […]
But perhaps the best assistance legislators can offer is to back off and resist temptations to engage in new misadventures in protectionism or industrial policy.
Contrary to common perception, US manufacturing continues to be a vibrant source of growth and economic dynamism. Provided Washington can avoid ill‐advised schemes to “rescue” the industry it should remain so for many years to come.
Read more here.
