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“Stealth industrial policy”



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Here at Planet Gore, we have noted for the last year that Obama’s “industrial policy” is little more than an attempt to transform America into a green economy, using both the honey of government subsidies and the hammer of government mandates.

The effort has been centered in Michigan — home of key Democrat Big Labor and Government Motors constituencies. Obama has diverted billions in stimulus dollars to corporate cronies like the Big Three, LGChem, A123, and Dow to build his pet, battery-powered toys.

The New York Times finally sat up and took notice this weekend, with reporter Jon Gertner spending some time on the ground here and writing a superb piece in the Sunday Magazine. Obama’s is, he says, “a stealth industrial policy based on the conviction that manufacturing is essential to the nations’ well-being.”

This is the nationalization of Obama-twin and ex-Michigan Governor Granholm’s failed “Green Belt” experiment. Like Granholm, Obama and his academic masters of the universe think they are smarter than the markets.

“Jennifer Granholm, Michigan’s former governor, has predicted that advanced batteries will create 62,000 jobs over the next decade,” writes Gertner. He continues:

It is tempting to see in this the stirrings of an industrial revolution. As the country’s jobless rate hovers above 9 percent, could this manufacturing revival be part of the answer to the jobs crisis? Or is it merely an expensive government bet on a lost cause?

Even in the battery industry, there are skeptics. Menahem Anderman, a California-based consultant, says that transforming 10 percent of the world’s automobiles into either plug-in hybrids or electric vehicles by 2020 is a pipe dream. His projection is for less than 2 percent. . . . (Anderman) questioned whether consumers would pay $10,000 more for an inferior car. As Anderman puts it: “Has there ever been, in the modern history of capitalist countries, a new product for which the mainstream customer paid more for less?”

Alas, we have to keep relearning the mistakes of the past.

“It was a calculated risk – a lot of money, to be sure, but given the stakes, I think it was a pretty thoughtful bet,” Obama auto advisor Ron Bloom tells The Times.

It’s fun to gamble with other people’s money.



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