“It is sensible for public policy to pay attention to the creation of great firms, to strength in specific sectors, and to the quality of the jobs generated by different economic models. But it should be obvious that the path forward for America is to focus on our strengths in information technology and media, and not compete with the Chinese for manufacturing supremacy…The scary thing about the factory-driven view of the American future is that it’s not totally implausible. The ‘insourcing’ trend where firms move production back to North America is real enough. The drivers are rising Chinese wages and falling ‘unit labor costs’ in the United States. But that’s just a way of saying that America can regain factory parity with China by eliminating the prosperity gap between our two countries—a very strange policy aspiration.”
— Matt Yglesias, Obama’s foolish obsession with manufacturing jobs will make America poorer.
