Industrial Policy Isn’t About Creating Jobs

Published

2 years ago

July 28, 2023

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Proponents of the ongoing push for national industrial policy, whether they come from the left or the right, frequently argue that we need to promote certain sectors or technologies to create a manufacturing boom. This boom, we’re told, is necessary to create more high-paying jobs. But I beg to differ. Industrial policy isn’t and shouldn’t be primarily about creating jobs. Its primary purpose, if it should exist at all, lies elsewhere.

The ultimate objective of an economy is not to provide jobs per se, but to improve overall living standards. This happens with an ever-increasing availability of quality goods and services that people voluntarily purchase to enrich their lives. Good jobs are a means to this end; they are not the end itself. This reality is easily proven by asking someone who loves his job if he’d continue to do it if it paid nothing. Virtually everyone’s honest answer would be no.

Now, don’t get me wrong: This requires spending power, and employment is how most of us get that, so the value of employment as a means is high. But it’s still a means. If new jobs were truly the only ends, the government could simply pay one-half of the population to produce outputs and pay the other half to destroy those outputs.

Obviously, any plausible justification for industrial policy must include more than job creation. Interventions are often done in the name of national security. This, for example, is the point of the CHIPS Act, which allocates over $50 billion in subsidies to reshore the production of semiconductors away from Taiwan in the event that China decides to invade its neighbor.

Leaving aside the fact that national security is too often and too easily used to justify economic interventions that have little to do with foreign threats, the argument reveals why industrial policy is no tool of job creation.

Think about it this way: Government favoritism in the form of subsidies, tariffs, and other interventions allocates resources (labor and capital) differently than the way resources are allocated by consumers spending their own money. Ordinarily, businessesspending their investors’ moneycompete for these consumer dollars. Industrial policy rests on the assumption that such market outcomes don’t adequately support higher causes such as national security. If that’s true, it’s all the justification industrial policy needs. Nothing needs to be said about jobs.

Nor should it. I’m skeptical that industrial policy will really spark a manufacturing boom in the first place. First, subsidies, tax credits, and government loans often end up paying firms to do what they were already doing. In addition, government favors tend to reallocate resources politically and not in ways that truly further the national interest. That means shifting resources away from some non-subsidized businesses toward subsidized ones, independently of their economic merit.

Second, the United States doesn’t make these decisions in a vacuum. As Scott Foster explains in the Asia Times, “the globalization of production capacity and new technology development is accelerating away from the United States,” in part because “Europe, Taiwan, South Korea and Japan want to keep their leading-edge technologies at home.”

Finally, the Biden administration’s generous subsidies often come with complications like requiring firms to provide expensive child care or buy American. And to stay friends with European governments, the administration eased requirements that to be eligible for Inflation Reduction Act incentives, electric vehicles should be assembled in North America and exclude critical mineral or battery components from “foreign entities of concern” (i.e., China).

Even if today’s industrial policy does trigger an industrial boom, we shouldn’t expect a corresponding manufacturing job boom. As Noah Smith reminded his readers in a recent blog post, “Most of the actual production work will be done by robots, because we are a rich country with very high labor costs and lots of abundant capital and technology. Automated manufacturing is what we specialize in, not labor-intensive manufacturing.”

The best job creation policy is a strong economy. The government should be content to create a level playing field with transparent rules and strong protection of property and contract rights. Of course, it should also supply public goods like infrastructure and ensure a stable legal system.

Be wary of those who push industrial policy as a means of job creation. It’s a short-sighted approach that distracts us from the more important question, which is whether hindering the market allocation of resources is truly justified for national security or other valid reasons.

Entertainment

BAFTA TV Awards red carpet: Celebs arrive in style ahead of ceremony

Published

3 hours ago

May 11, 2025

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BAFTA TV Awards red carpet: Celebs arrive in style ahead of ceremony

Stars of the small screen have hit the red carpet in the sunshine ahead of today’s BAFTA TV Awards.

Baby Reindeer, Mr Bates vs The Post Office, Rivals, and Slow Horses are among the shows in the running for big prizes.

This year’s ceremony is hosted by Alan Cumming.

But before the BAFTA prizes are dished out, the stars are making their way down the red carpet at London’s Festival Hall.

Here’s a look at all the outfits.

BAFTA TV Awards – live updates
The full list of nominated stars and shows

World

Terror group supporters posted on TikTok, YouTube and Google from site targeted in Indian airstrikes

Published

4 hours ago

May 11, 2025

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Terror group supporters posted on TikTok, YouTube and Google from site targeted in Indian airstrikes

Social media accounts expressing support for a Pakistan-based terror group linked to al Qaeda appear to have posted recent videos from a Pakistan mosque targeted by Indian airstrikes.

Sky News has found videos posted on TikTok, YouTube and Google that appear to be filmed at the Markaz Taiba Mosque in Muridke. The captions and usernames contain expressions of support for the Lashkar-e-Taiba (LeT) and a group called ‘313’.

Sky News has found and geolocated multiple videos that appear to be filmed in the area where the captions include either or both ‘313’ and LeT.

Some of the videos show men in the streets with guns. Another post captioned a video of children doing martial arts training inside the targeted mosque, “we are little soldiers, and we fight the non-believers”.

The caption uses the hashtag #جہاد313, which translates to ‘313’ jihad.

‘313’ appears to refer to the 313 Brigade, a proscribed terror organisation in Pakistan.

In a TikTok video posted to the Google page for Markaz Taiba Mosque in Muridke, a man can be seen walking along the street with a gun.

The account that posted that video wrote in their description, “Lashkar Taiba, Mujahid Force, ‘313’ and Markaz Taiba Muridke”, self-proclaiming their support for the groups.

India’s retaliatory strikes on Pakistani-adminstered Kashmir and Pakistan on 7 May came after a deadly attack in Indian-administered Kashmir last month.

Gunmen opened fire on tourists, killing 26 people and injuring dozens in a popular holiday spot near Pahalgam, Kashmir, on 22 April.

LeT were accused by India of involvement in the Pahalgam attack through their proxy the Resistance Front, which claimed responsibility for the attack.

LeT, which is designated as a terrorist organisation by the UN Security Council and the UK, focuses on fighting Indian control in Kashmir and is based in the Punjab region of Pakistan.

Pakistan denies allegations of terror camps operating in the country. This region has been in the control of the Punjabi government since 2010. The Punjab government condemned the Indian strikes, and declared a state of emergency across Punjab.

Muskan Sangwan, senior intelligence analyst at TRAC, a terrorism research and analysis consortium, told Sky News: “Brigade 313 is al Qaeda in Pakistan. It’s an umbrella organisation for members of several groups like Taliban, Lashkar-e-Jhangvi, Haqqat ul-Jihad-al-Islami, Jaish-e Muhammad, Lashkar-e-Taiba, and Jundullah.”

Ms Sangwan explained that ‘313’ refers to the number of companions said to have fought with the Prophet Mohammed in the Battle of Badr.

TRAC have seen a recent uptick in TikTok videos and other social media posts that refer to ‘313’.

Many of the accounts are linked to each other.

Ms Sangwan said: “They [the TikTok users] mostly use ‘313’ as a hashtag… trying to push that hashtag to as many people it can reach on social media.”

Sky News sought to verify the location by comparing before and after videos from the strike location, and using the video released by the Indian army conducting the strike.

One video showing damage at the strike location was posted by a user with 313 in their TikTok username.

Below is satellite imagery that shows the destruction of the site.

In one TikTok, the video is captioned “bring your arms and ammunition and go to war”. The text on the screen of the TikTok is ‘313’ and he is carrying a gun.

The group are comfortable with having an online presence. On the Google tag for Markaz Taiba Mosque in Muridke, men pose for a group photo. Almost all the people in the photo have used ‘313’ on TikTok.

Ms Sangwan explained: “With these people from Muridke, pushing this propaganda on social media would generate a lot of significance in terms of recruitment and in terms of gaining support from local people and from other people.”

Sky News’ Asia correspondent Cordelia Lynch has reported on the ground in Muridke.

India says it struck Markaz Taiba, a site in Muridke about 15 miles (25km) from the border, which has long been claimed to be a terrorist training site associated with LeT.

MEMRI, a US-based research group that monitors terrorist threats, told Sky News: “It has been known for decades that Lashkar-e-Taiba has its headquarters in Muridke.”

Sky News contacted the Pakistan Ministry of Defence for comment. Khawaja Asif, Pakistan’s defence minister, told Sky News: “This appears to be a random video with background music added later – consistent with how TikTok trends often function. If this is to be considered credible evidence, we could produce millions of similar clips ourselves.”

Mr Asif also said that any suggestion that the mosque was used as a base by terrorists was a “completely false, social media made up hoax”.

On 7 May, after the strikes in Pakistan, the Indian subcontinent branch of al Qaeda issued a statement condemning India’s actions and encouraging its supporters to wage jihad against India.

The Data and Forensics team is a multi-skilled unit dedicated to providing transparent journalism from Sky News. We gather, analyse and visualise data to tell data-driven stories. We combine traditional reporting skills with advanced analysis of satellite images, social media and other open source information. Through multimedia storytelling we aim to better explain the world while also showing how our journalism is done.

US

Bodycam footage shows ICE agents arrest Newark mayor Ras Baraka

Published

4 hours ago

May 11, 2025

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Bodycam footage shows ICE agents arrest Newark mayor Ras Baraka

Bodycam footage has captured the arrest of a US city mayor during a protest at a federal immigration detention centre.

Newark Mayor Ras Baraka, who was released from custody hours after he was detained on Friday, has denied trespassing during a confrontation with Immigration and Customs Enforcement (ICE) agents.

He was at the facility, which opened in the New Jersey city last week, with three members of Congress and witnesses said his arrest came after he tried to join them in entering the centre.

In bodycam footage released by the Department of Homeland Security (DHS), an agent can be heard telling him: “Listen, congressmen are different, congresswomen are different.

“Mr Mayor, anyone that is not a congresswoman or man, step back… It’s your last warning. You will be placed under arrest.”

A heated argument broke out after Mr Baraka’s entry was blocked and he left the secure area to rejoin protesters on the other side of the gate.

Minutes later, several ICE agents, some wearing face coverings, surrounded him and others on the public side.

Mr Baraka was dragged back through the gate in handcuffs, as protesters shouted: “Shame.”

Alina Habba, interim US attorney for New Jersey, said on X that Mr Baraka trespassed at the detention facility, which is run by private prison operator Geo Group, adding he had “chosen to disregard the law”.

The DHS said in a statement that the politicians had not asked for a tour of the Delaney Hall centre, which the agency said it would have facilitated.

The department said that as a bus carrying detainees was entering in the afternoon “a group of protestors, including two members of the US House of Representatives, stormed the gate and broke into the detention facility”.

After his release on Friday night, the mayor told waiting supporters: “The reality is this: I didn’t do anything wrong.”

Mr Baraka, a Democrat running to succeed term-limited Governor Phil Murphy, has embraced the fight with Donald Trump‘s administration over illegal immigration.

He has been a vocal critic against the construction and opening of the 1,000-bed detention centre, arguing that it should not be allowed to open because of building permit issues.

DHS said in its statement that the facility has the proper permits and inspections have been cleared.