No matter which way you cut it, the Inflation Reduction Act and the Bipartisan Infrastructure Law are stimulating a massive reinvestment in manufacturing, infrastructure, and good working class jobs in the United States. After decades of complaints, political potshots, and genuine economic pain from the loss of such working class jobs, we now have an administration that is doing something about the crisis and reversing the trend. And we had Democrats in control of the House and the Senate long enough to strongly support the president’s efforts and pass legislation that would enable the success. We are now beginning to reap the rewards — and there’s much more to come in the years ahead.
In the battery space, Benchmark Mineral Intelligence recently noted that the battery gigafactory pipeline in the USA has surpassed the battery gigafactory pipeline in Europe. The IRA worked. We have known this to some extent since right after it was passed into law, because we were having conversations with battery companies and other companies in that economic ecosystem, and some of them were straightforward right off the bat in saying that the IRA has stimulated factories or other major investments in the USA.
Nobel Prize winner Paul Krugman actually has a full op-ed in the New York Times on this topic this week. It is titled “Making Manufacturing Great Again.” Krugman observes that Biden is not getting due credit for the manufacturing boom that is happening as a result of his and other Democrats’ policies. Of course, Republicans would never acknowledge such a thing. How could they? That would essentially be sacrilegious. Though, the media spends approximately zero time on this topic as well. Who is highlighting the manufacturing boom that is happening under his watch? And a green one at that.
Tweeting about it, Krugman says, “I guess I shouldn’t be surprised that there’s pushback against the observation of a Biden manufacturing boom. So first of all, no, it isn’t just inflation. Deflate by whatever you like, and it’s still parabolic.” In other words, doing the math and science, this growth in manufacturing is not explained by broader economic factors like inflation. “Second, when people say ‘of course it’s happening, it’s being subsidized’ — well, yes, but the size of the boom has surprised everyone, including industrial policy proponents. So there’s real news here.”
Despite a long, drawn out obsession with a potential recession, the economy is actually booming. Unemployment is low. Factory projects are popping up, and the green energy economy is back.
I guess I shouldn’t be surprised that there’s pushback against the observation of a Biden manufacturing boom. So first of all, no, it isn’t just inflation. Deflate by whatever you like, and it’s still parabolic 1/ https://t.co/U6rjWD2QAp
— Paul Krugman (@paulkrugman) June 7, 2023
Related story: Solar Market Sets New Record In 1st Quarter In USA
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