2022: we cried, we laughed, we transformed the American economy and avoided getting shellacked for it.
As the year comes to a close, I wanted to take the opportunity to celebrate some wins; express gratitude to family, friends, and colleagues; and share the tunes that saw us through it all.
Industrial policy is good policy…
2022 was the year that industrial policy — the idea that the state has an interest in which industries survive and thrive — finally broke through from an obscure interest of development economists into the mainstream of US politics. I’m old enough to remember 2019, when we published “Industrial Policy and Planning: What It Is and How to Do It Better,” titled thus because assumed most of our readers would have no idea what we were talking about, or would have negative associations if they did.
Fast forward to today. New laws like the Inflation Reduction Act (IRA), CHIPS and Science Act, Infrastructure Investment and Jobs Act (IIJA), and the American Rescue Plan Act (ARPA) direct and crowd-in trillions of dollars into a modern American industrial strategy. The Roosevelt Institute hosted a massively waitlisted forum on “Progressive Industrial Policy: 2022 and Beyond,” with 17 speakers, including a cabinet official and numerous senior Biden administration officials, along with representatives from labor and business. (You can watch the video here, and I encourage you to do so!) And other major convenings leaned into this framework and were kind enough to include us, including a Financial Times / Columbia Law School forum on “Rethinking Globalization, Intermediation, and Efficiency” and a Woodrow Wilson Center forum on “Making Trade Inclusive: A Conversation on Foreign Policy for the Middle Class” (shout out Rana Foroohar, Kathryn Judge, and Jeff Kucik for hosting).
…And good politics
This agenda proved to be not only good policy, but also good politics. While the party in control of the presidency typically loses big in the midterm elections, candidates across the country played successful defense and offense running on industrial policy accomplishments. For Democrats, that meant gains in the Senate and only single-digit losses in the House — a result very rarely seen in US history, and in sharp contrast to the 63-seat losses for Democrats in the 2010 midterm elections, which President Obama deemed a “shellacking.”
And notably, despite almost uniform GOP opposition to the major industrial policy laws, more Republicans are also seeing the potential for investment in industries of the future. As Sunny Malhotra and I show with nifty maps and analysis here and here, there are reasons for optimism that the shift towards active clean supply chains will be a lasting one, as congressional districts and states across the country (60 percent of them “red” districts”) are among those likely to see early job creation benefits.
All of this stands to increase the political “stickiness” of the US’ climate commitments. After all, the way to make the US a credible international partner on climate — even when one of two major domestic political parties is a “climate denier” in deed if not thought — is to make the green transition a difficult-to-reverse and solid business/jobs proposition for communities across the US.
A shift to sectoralism
A key benefit to being explicit about which industries the public wants to encourage or discourage is that it opens up different modes of shaping international trade. Instead of governments placing broad “industry-neutral” rules around markets, the US and its allies are increasingly turning to explicit and jointly-administered market creation for the products and sectors they want to promote — akin to the commodity plans we saw during the Franklin D. Roosevelt administration.
This turn was perhaps most explicitly visible with the Global Arrangement on Sustainable Steel and Aluminum, a US-EU initiative announced in late 2021 and further developed in 2022 — towards a deadline of late 2023. This “carbon club” creates a forum to leverage the American and European markets to encourage trade in decarbonized heavy metals — among the most carbon-intensive and highly traded products known to humankind. Moreover, it is an example of what David Victor and Charles Sabel call experimentalist governance, where countries agree to learn by doing in specific sectors and setting before imposing top-down, one-size-fits-all rules for the economy as a whole.
We have been long-time champions of sectoralism, including in 2020 and 2021 pieces with Tim Meyer on what a green steel deal could look like. We continued this line of work in 2022, including with a March webinar with Ambassador Katherine Tai of the US Trade Representative’s office, and an in a piece in July for Foreign Affairs by Joe Stiglitz, Isabel Estevez, and me. Lots more will happen in 2023: watch this space.
Moving fast (and writing fast) for the working class
The debate on (clean) energy build-out is often painted as if there are modernizers who want to go fast and do-gooders who want to go slow. The former camp are thought to include business groups, “disruptive” outcome lovers, and YIMBYs, while the latter are seen as bureaucrats, process-lovers, and NIMBYs.
We’ve put out a string of reports this year outlining a third tradition from US history, which could be called Rooseveltian or just plain “moving fast for the working class.” We bookended the year with reports on Title I and Title III of the Defense Production Act (DPA), which give the government tools to get around other sources of slowdown for green economic development, including where private interests favor fossil fuels over clean energy, share buybacks over investment, and busting unions over productive collaboration with workers. (The second report, from December, was coauthored by Joel Dodge, Joel Michaels, Lenore Palladino, and me.)
In May, we put out a read-along report for Biden’s historic supply chain reports, that laid out a path for what equitable and sustainable reshoring might look like. In August, we released a report coauthored by Arnab Datta, Ashley George, Joel Michaels, and me on how the DPA can interact with other trade, appropriations, and other tools to turbocharge green industrial policy, as well as a report from Lenore Palladino and Isabel Estevez on the need for guardrails in industrial policy lending.
In 2022, I continued to contribute to the Washington Post’s Monkey Cage blog, with pieces on the international law implications of Russia’s invasion of Ukraine (March 11, with Tim Meyer), Biden’s supply chain reports (May 17), the implications of recent WTO rulings for green industrial policy (December 20). I also contributed a piece in January to the print edition, on precedents from the FDR era for confronting inflation.
Appreciating community and good times
The increasing salience of our ideas has brought new opportunities for team-building. In 2022, I was able to bring on board excellent collaborators, including fellow-now-deputy-director Isabel Estevez, research associate Sunny Malhotra, and senior fellow Saule Omarova. And we deepened our collaborations across teams at our growing Roosevelt family, which has gone in a few short years from a dozen or so folks to around 50.
On the personal front, I celebrated my 25th anniversary since I moved from Louisville to DC, and celebrated 15 years of marriage and 18 years of partnership to the beautiful and brilliant Heather. Our poodle Tanya turned six. My parents celebrated 50 years of marriage, and we convened on Louisville to mark it. Throughtout the year, we took time to explore the vast open spaces of the Shenandoah Valley around DC. And there were many puzzles and audiobooks!
2022 was another year full of wonderful songs, some of which I’ve put on this playlist here, and some longtime favorites I had never (Jawbox, Mars Volta, Gang of Four) or rarely seen live (June of ‘44).
Here’s to a happy and productive 2023!