Marco Rubio will call for the government to protect key industries and workers from the rise of China, further breaking with the libertarian-leaning GOP orthodoxy of the past decades.
The Republican Florida senator will present the case for a “21st-century pro-American industrial policy” in a speech Tuesday at the National Defense University, according to a draft given to the Washington Examiner.
Rubio previously stirred up controversy among conservatives and his fellow Republicans this fall by accusing them of overlooking the needs of workers in favor of business profits, and citing Catholic social teaching in calling for a “common-good capitalism.”
“There are moments in which the market produces an efficient outcome that doesn’t reflect our national interest, and in those moments, it is the job of policymakers to ensure the national interest is protected,” Rubio told the Washington Examiner in previewing Tuesday’s speech.
Rubio said that he is not proposing that the government subsidize or direct any agencies, and that the United States should remain a market economy.
Furthermore, the draft speech does not endorse specific government efforts to aid industries at risk from China, besides referencing his bill to boost the U.S. rare-earth minerals industry — production of which is currently monopolized by China. Rubio, the chairman of the Senate Small Business Committee, also favors reforms to boost small business investment in the aerospace, rail, electronics, telecommunications, and agricultural machinery industries, all of which China is trying to dominate.
Instead, the speech lays out a more general case for protecting certain sectors and workers, and is sure to spark debate among conservatives, many of whom have long opposed industrial policy on the grounds that the government should not pick winners and losers.
Responding to the rise of China requires the U.S. to “reject the fundamentalism that argues that the greatest virtue in American policy is to maximize ‘efficiency,’” the draft speech reads.
“When dignified work, particularly for men, goes away, so goes the backbone of our culture,” it says. “Our communities become blighted and wither away. Families collapse, and fewer people get married.”
Industrial policy often consists of governments working to prop up domestic manufacturing. Japan, as an example, engaged in large-scale industrial policy in the wake of World War II to rebuild its economy. China has a plan, “Made in China 2025,” to systematically upgrade its manufacturing sector by making more high-tech goods in key industries.
Many American conservatives and libertarians object to industrial policy on the basis that, through trade, the U.S. can raise domestic living standards and forestall conflict with other nations. Rubio, though, said that he was trying to avoid a conflict or war with China that could result if the current trade imbalances persist.
“Only now are we beginning to awaken to the fact that China’s not some poor developing country that’s liberalizing and headed to become more like us, but is actually a near-peer competitor,” he said.
