Why American manufacturing is becoming less efficient

Advocates of industrial policy have long argued that manufacturing possesses special powers. Industry’s demands lead to technological progress; the goods it produces must pass the muster of global markets, which drives up efficiency. Some then take things further. When countries grow richer, manufacturing moves overseas as firms seek to reduce labour costs. This, they say, justifies tariffs and subsidies to protect manufacturing and boost growth. “Making things matters,” argued a recent column in the Wall Street Journal by Oren Cass, who runs American Compass, a think-tank at the vanguard of the Republican Party’s new-found protectionism.