What would Alexander Hamilton or George Washington think today of our dependence on foreign nations, and even hostile nations, for necessities?
“The glaring problem we now encounter is the erosion of our defense industrial base. The once-vaunted arsenal of democracy that led America to victory in World War II is long gone. Simply put, we no longer produce the weapons and munitions needed for high-intensity, industrialized conflict,” wrote John Adams, U.S. Army Brigadier General (Retired) and president of Guardian Six Consulting. His warning is yet another troubling consequence of decades of deindustrialization driven by free trade agreements.
The United States and its Arsenal of Democracy, has seen its manufacturing base hollowed out. Shipbuilding offers a stark example: last year, the U.S. produced only three ships, while China surged far ahead. Free trade has not only led to a decline in domestic manufacturing—it has effectively subsidized the buildup of the Chinese military.
In response, President Donald Trump issued an executive order to rebuild America’s shipbuilding industry. This move reflects an industrial policy aimed at strengthening both the merchant marine fleet and the U.S. Navy.
The COVID-19 pandemic laid bare how dependent the U.S. has become on foreign nations for essential goods. It’s not just cheap consumer items like toys and electronics that have been outsourced, but also high-tech products, semiconductors, and pharmaceuticals. America’s growing vulnerability in sectors like shipbuilding further threatens national security.
This debate over trade and manufacturing has split the conservative movement. For decades, the prevailing view held that free trade was best. President Trump has challenged that orthodoxy.
Historically, Republicans—drawing from the legacy of Alexander Hamilton, Henry Clay, and Abraham Lincoln—supported the American System, which included protective tariffs. This approach was central to Republican platforms from Lincoln through Herbert Hoover, with protection seen as essential for strong wages, economic growth, and national sovereignty.
After World War II, however, the GOP and the conservative movement drifted toward classical liberalism and free-market ideals. Hamilton, once revered, was recast as a proto-progressive, supplanted by admiration for Jeffersonian ideals.
In Industrial Policy for the United States: Winning the International Competition for Good Jobs and High-Value Industries, Marc Fasteau and Ian Fletcher reenter this debate with a compelling blueprint for restoring American manufacturing. Their work makes a bipartisan case for targeted industrial policy and protective tariffs as tools to rebuild the middle class and restore economic independence.
While defenders of free trade argue that it brings cheaper goods, investment, and growth, the disruptions have been profound. The U.S. currently runs a $1.2 trillion trade deficit—including nearly $40 billion in agricultural goods. Many economists dismiss the trade deficit as an “imagined problem,” but critics like former U.S. Trade Representative Robert Lighthizer see it as a massive wealth transfer and a grave national security concern. He notes that $20 trillion has left the U.S. over the past two decades due to trade imbalances.
Fasteau and Fletcher cite the loss of six million manufacturing jobs from 1998 to 2010, with an estimated 3.5 million tied directly to imports. These losses didn’t just affect workers—they eroded the middle class. Wages for non-supervisory workers have stagnated in part because of the decline in high-paying industrial jobs.
The fallout is far-reaching. In many regions, particularly the Midwest, the collapse of manufacturing has contributed to rising addiction, deaths of despair, and greater reliance on welfare. It’s also linked to declining marriage and birth rates. While trade isn’t the only factor behind these challenges, it plays a major role.
Fasteau and Fletcher propose reversing this trend through a comprehensive industrial strategy, including exchange rate management, tax breaks for R&D, export controls, government-funded technology research, and yes—tariffs.
“When properly implemented, these policies have worked,” they argue, pointing to the industrial mobilization that defeated Nazi Germany and sustained the Cold War effort. Their book isn’t partisan, but it speaks to a tradition conservatives can reclaim.
Senator Marco Rubio, now U.S. Secretary of State, put it well: “Using government to support industry and defend our economic and national security is nothing new for America, nor is it a departure from American conservative principles.”
Alexander Hamilton certainly believed so. His economic vision promoted protective tariffs and subsidies to foster domestic manufacturing and reduce reliance on foreign powers. As he put it, the goal was to “render the United States independent on foreign nation[s] for… essential supplies.”
What would Hamilton or Washington say today, as we depend on adversaries for critical goods?
President Trump is already using protective tariffs to bolster industries like steel and aluminum. These actions also serve to counter unfair trade practices from China and even some allies.
Industrial Policy for the United States is a timely reminder: a strong economy requires more than consumer convenience. Conservatives can champion economic nationalism while maintaining limited government principles. That’s the legacy of leaders like Warren G. Harding and Calvin Coolidge.
“My observation of protectionism is that it has been successful in practice, however unsound it may appear to be in theory. That must mean the theories have not taken account of all the facts,” wrote President Coolidge. Coolidge was right. Free trade has become an untouchable ideology—but in practice, it has failed too many Americans. President Trump’s strategy to put workers and the economy first is exactly the course correction this country needs. Fasteau and Fletcher provide the intellectual foundation to help make it happen.
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