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Show THE VOICE OF BUSINESS An industrial policy vhav works By Richard L. Lesher, President Chamber of Commerce of the United States Stung by the growing success of supply-side economics, the liberal establishment has been searching desperately for an alternative that will both protect and expand the welfare state and still not be laughed out of town. The first requirements were that this policy have a new name and some intellectual heavyweights to write books about it. They have decided, it appears, on "Industrial Policy." Liberal academicians have been making mak-ing the rounds of the television talk shows. All the leading Democratic contenders for the presidency have endorsed en-dorsed an Industrial Policy in some form. And everyone is insisting that this is something new, innovative and, of course, progressive. But just what is this Industrial Policy? Is it a new approach to economics? Will it work? Unfortunately, Industrial Policy is simply a new name for centralized government planning. It is not new. And it won't work it never has. The idea is that some committee of self-styled experts sitting in Washington will decide which industries in-dustries are growing and which are fading. The Congress will then throw money your tax dollars at those growth industries and, conversely, help finish off the old industries. It is a return to the failed policies of protectionism, subsidies and ever more regulation. And, of course, to pay for all these expert planners and their nice offices more taxes. A brief look at the planned economics of the Eastern Bloc and the milder forms in socialist France and Spain paints a dismal picture of such planning efforts. The American government is simply not capable of second guessing the direction and pro-gess pro-gess of a $3 trillion economy. Between 1971 and 1982, government forecasts of the change in the federal deficit for the next year have been wrong by an average error of 529 percent. per-cent. The government has misforecast changes in federal spending by an average of 29 percent. Federal revenue predictions have bear-by bear-by an average of 87 perce; predictions in the change for it ; ' were off by 36 percent. Our government cannot ever; its own financial status os? ahead. Ho w then are they expeii predict the future of entire ices?: 10, 15 and 20 years into the fa (If some bureaucrat were so: clever enough to accurately rri market trends in the future, her. simply head to Wall Street as: a fortune.) No. These would-be drafters i?-. year plans for the American eer have come up with a loser. It is tried in the past and always fii. is, frankly, nothing but ancce ; tempt to increase the size art r of the federal government te: the opposite direction we sfcee travelling. I w ould like to suggest z dustrial Policy" targeted Dot:;: industries or regions of the nar a policy of growth for all Air.fi Rather than looting some m and firms to subsidize others. Surtaxes Sur-taxes on all workers and conx Rather than subsidizing te' favored industries, let us fcy-sound fcy-sound monetary" pocy t0 cut and interest rates facis -Americans and businesses. Rather than raising taxes i" working men and women of .t-to .t-to create a pool of govern controlled investment capital' cut taxes on the savings s vestments of the American p?T stimulate real investment i wealth producing jobs. Rather than increasing thereof there-of bureaucrats and regulation-name regulation-name of economic efficiency J remove the deadweight of norJ tive paperwork and repeal the that misdirect capital and laW In short, I recommend the i dustrial policy that has ever any nation and at any time the free market, with itsreU; individual initiative, nsk-Ut; rewards for those who wort smarter and more creatively Now that is an industrial ' thy of the name. |