Industrial Policy and Non-policy in the United States

In the context of declining relative output and productivity there have been increasing calls for the American government to play a greater role in industrial policy in recent years. Traditionally, however, US government intervention has been ad hoc and reactive rather than planned and strategic. Regulation policy has rarely been linked to economic growth, and most recently has evolved in a policy context separate from and largely antagonistic to business. Direct and indirect government aid is largely a result of the lobbying activities of diverse economic interests operating in an open but fragmented policy system. Of the various industrial policy options open to federal governments only one, facilitative or positive adjustment policy, is politically and ideologically possible. Even this, however, will be difficult to implement in a pluralistic and fragmented political system.