A first step might be recognizing the opportunity, the chance, of having low costs at the inputs of one's own economy. Lower cost steel, electronics, cars is not a bad thing. It's a great thing. It's an opportunity. Instead, understand your own economy and what actually makes sense to produce locally. Of which there is plenty - really the US economy is doing pretty well.
The US might achieve again local low cost electronics manufacturing eventua... wait, what? Was the US ever the place for low cost electronics manufacturing? No it wasn't. At any rate, the US can try and promote whichever industry they want - but surtaxing its entire economy in the meantime is insane (plus a significant part of the rest of the planet along the way.)
There's more at stake than cost. Steel, electronics, and vehicle production are strategic capabilities, essential to fighting a long war. And even if no major war ever happens again, importing the inputs to an economy leaves the country vulnerable to sanctions or to being undercut when the nation providing the inputs moves up the tech stack.
For too long Americans have preferred immediate profit over long-term capacity.
> Instead, understand your own economy and what actually makes sense to produce locally. Of which there is plenty - really the US economy is doing pretty well
I'm curious what you're referring to here. It seems to me that China is catching up in most of the industries where America is still competitive (e.g. computing, pharmaceuticals, vehicles).
I'd say our economy is mostly floating on our military strength and the financial system it protects, but that won't last without a tech or manufacturing advantage.
- You can maintain a strategic capability without destroying your economy along the way. See for example the heavy press program. A strategic capability, very specific, hard to rebuild. You could certainly apply that to some level of local steel production (which does exist last I looked) - the way US navy ship-building competence is carefully maintained for example. You don't have to inflict that cost on most of the steel used for, say, building and bridges construction.
- You can want to run your entire economy on a "self-contained" basis but that goes against all the work that has been done for now decades in the name of economic efficiency. Such an idea will cost you dearly in the final output: standard of living. (For a small country it would be hopeless but both China and the US are large enough that they could aim for complete know-how.)
- Everyone is free to compete with anything. And yes, China is large enough that it can try and be effective at everything. Even that, does not negate the benefits of trade.
- (The US competitive on civilian vehicles?? Doesn't matter, this is a detail at this stage.)
- I don't expect very much of the US military vehicle production - in final assembly or in subsystems - comes from China. What little there is, you could import from Europe.
- The US economy "floating on military strength"??
> The US economy "floating on military strength"??
Yes, it's our military strength that makes investors trust our currency and allows us to maintain the world's largest trade deficit. Not just our own, but the weapons we provide to friendly governments (mostly dictators) around the world.
The rest? You're just ignoring the possibility of either sanctions being imposed on us (cutting off the free trade which, I agree, increases standard of living while it lasts) or fighting a major war (in WW2 the entire civilian production capacity was redirected to the military, a limited "strategic capability" will not be sufficient).
In fact, even the recent (very limited) war in Ukraine was more than our current production capacity for ammo could handle.
> Yes, the US is still the second largest producer of civilian vehicles
Isn't that mostly for internal sales? The US export some civilian vehicles, that's true. But my impression is that much of the local production is due to threatening and begging in exchange for somewhat less difficulty for selling within the US. So, "competitive" would be arguable.
I'll concede that recent years have shown that stockpile and production capability in particular for ammo is low for an era where - after all - there are circumstance where a lot of ammunition gets expended fast. And THAT very much won't be solved through tariffs. Not even for guidance electronics.
Long term and stable support through various targeted subsidies. Biden did this for some manufacturing industries and we're already seeing results with increased production and private investment that far outpaces the public investment that kicked it off. One key issue is that these industries and the supporting resources and expertise take a long time to develop so the support needs to be consistent. Blowing up trade deals and flip flopping around on tariffs every few weeks is the opposite of what will help. Trump talked a big game on manufacturing his last term but accomplished absolutely nothing; I expect this term to be worse.
There would probably be near zero electronics and machine manufacturing in the US without military spending. I really cannot emphasize enough how many shops out there are kept alive by military contracts stipulating domestic manufacturing.
This is also why the defense budget never gets cut, by dems or repubilicans. It's the backstop for a gazillion jobs and domestic manufacturing capability.
As much as I dislike the US' militaristic identity and especially its foreign policy, and would like nothing more than to slash the military budget in half and use it for something beneficial, when it comes to the economic benefits of the military-industrial complex, you're absolutely right.
But a big problem, especially when it comes to competing with China, is that you need your supply chain to be local too. The main reason manufacturing is so affordable in China is not just labor costs, which are now lower in some other countries than China, but because you have the entire supply chain right at hand.
