Trade experts Soumaya Keynes and Chad Bown have released their new book, How to Win a Trade War, offering a historical framework for effective trade strategies as the U.S. navigates its economic rivalry with China. The timing coincides with escalating tensions and renewed tariff debates under the Biden administration.
American Industrial Policy Falls Short
Keynes and Bown highlight China’s aggressive industrial policies, particularly in sectors like electric vehicles and semiconductors, as a model Washington must learn from. Unlike China, which creates domestic demand through state-directed purchasing, the U.S. has historically shied away from such interventions. ‘They didn’t force anyone else to actually buy the chips that Intel was going to make,’ Keynes noted, critiquing the lack of follow-through in U.S. policies like the CHIPS Act.
‘There’s still a lot of learning that we have to do,’ Keynes said. ‘We don’t live in a perfect world.’
The authors argue that America’s reluctance to adopt strategic industrial policies puts it at a disadvantage in the global trade arena. They urge policymakers to study China’s methods and prioritize domestic industries to safeguard American workers and economic sovereignty.