America’s economy is by far the biggest in the world.
It’s built on incentives favoring oil and gas that have been in place for decades. We’re also driven by the greed that comes from having too much founders’ equity and inherited wealth.
It’s going to be tough to turn around.
Electing a government with the right priorities isn’t enough, especially when the new guys come from government and academia rather than the private sector.
Much of the aid President Obama set in motion to start the renewable energy revolution was wasted on Elon Musk. Musk built himself a huge fortune with it, but the economy he changed was China’s, not ours. It’s China that now dominates Electric Vehicles, thanks to lessons it learned from Elon.
The Rich Get Richer
The same thing happened with COVID. I’m not just talking about the billions sent out to keep companies in business, so much of which was stolen. I’m talking about the solution to the problem, which Pfizer bought from a German company. They didn’t put their obscene profits back into research. They bought up a bunch of other companies and threw a party with the rest. Criticize Moderna if you want, but at least they put their money back in the business.
Then there’s the Inflation Reduction Act, which the Administration meant to jump start EV and battery production. Much of the money is going to foreigners, who complain they’re not getting enough of it. Ford and GM still won’t make an EV people can afford. And the Cybertruck? Really? China is also making bank on this.
Finally, we come to antitrust policy. The government wants to end mergers that are just driven by layoffs, or that are meant to boost monopolies. But rejecting the JetBlue-Spirit and iRobot-Amazon mergers makes no sense. Keeping failing companies from a lifeline that might keep their people employed, just to teach Big Tech and the Airline Oligopolies a lesson? All that does is discredit the policy.
The aim of the new policies is laudable. The fact is that our industries, built around the incentives of fossil fuels and private equity, will resist cooperation to the point of calling any regulation communist.
We need to be able to talk about that without putting at risk the capitalist system that made so many of us rich in the first place.