Industrial Policy Synergies: Reflections from Biden Administration Alumni
Washington, DC — With the Inflation Reduction Act, CHIPS and Science Act, and Infrastructure Investment and Jobs Act, the Biden administration embraced industrial policy as a means of managing an economy undergoing profound structural changes. The administration now faces the challenge of implementing these new policies effectively, efficiently, and justly. Doing so will require mobilizing across policy domains.
Earlier today, the Roosevelt Institute unveiled a new collection of essays, Industrial Policy Synergies: Reflections from Biden Administration Alumni, and hosted a panel event with its co-authors on what the road ahead looks like for an “all-of-government” approach to industrial strategy. In the report, former Biden administration alumni reflect on what synergies are needed across policy domains for industrial policy to be successful—in particular, how macroeconomic policy, climate policy, trade policy, labor policy, inclusion policy, and competition policy can help make better industrial policy, and vice versa.
“Industrial policy doesn’t—and shouldn’t—exist in a vacuum. But what we sought to understand is what types of collaborations are needed across various policy areas for industrial policy to be successful?” said Todd N. Tucker, director of industrial policy and trade at the Roosevelt Institute. “All the essays point in various ways to the importance of greater public faith in government and greater government faith in itself. And each shows there are lots of ways these synergies can make for better policy and human outcomes.”
The insights can be grouped into a few categories: better tools, better strategies and relationships, better values, and unfinished business, as the authors share:
- “With a new era of industrial policy upon us, macroeconomics will need to develop new tools and techniques to advise policymakers on effective crisis response. Being able to think through the causes and consequences of various shocks can enable us to consider appropriate policy interventions in advance, rather than stumbling from crisis to crisis,” said Sameera Fazili, Roosevelt Institute fellow and former deputy director at the National Economic Council.”
- “For substantive and political reasons, there will be no effective, durable climate action without industrial strategy. Market fundamentalism is simply not up to the task of catalyzing the political and technological feedback loops necessary to sustain climate action over decades,” said Jane Flegal, former senior director for industrial emissions at the White House Office of Domestic Climate Policy and the Council on Environmental Quality.
- “What are multilateral institutions like the WTO [World Trade Organization], if not vessels to advance practical solutions to the problems of the day? If their rules hinder such solutions, it is the institutions that need to change, not the solutions,” said Jennifer Harris, former special assistant to the president and senior director of international economics at the National Security Council.
- “For too long, to the extent that our nation had an industrial policy, it was unspoken and primarily focused on the manufacturing sector and its largely white, male workforce—leaving behind critical sectors of our economy in which public investment has been lacking and we’ve fallen behind foreign competitors,” said Janelle Jones, former chief economist at the Department of Labor.
- “In addition to spurring economic transformation, these investments [the American Rescue Plan, the Bipartisan Infrastructure Law, the CHIPS and Science Act, and the Inflation Reduction Act] represent an important new policy paradigm: a reclaiming of government’s proper role in constructing a dynamic and inclusive economy,” said K. Sabeel Rahman, former senior counselor and associate administrator in the Office of Information and Regulatory Affairs in the Office of Management and Budget.
- “If industrial policy is understood broadly—as more than just throwing money at national champions or favored industries—it becomes obvious that both competition policy and controlling the structure of economic power form an integral part of American industrial policy. They are the levers that serve to either decentralize economic power (or fail to do so), and play a role in preventing any class or region of the country from becoming dominant over the rest, in such a manner as to threaten democracy and lead to unrest,” said Tim Wu, former special assistant at the White House National Economic Council.