We need to acknowledge that the U.S. is not highly competitive in lower value-added manufacturing and relies on imported intermediate goods to remain globally competitive and keep final goods affordable for American consumers.
This reliance is not a flaw but a feature of having a higher standard of living. Even with significant investment, the fundamental economics of comparative advantage are difficult to overturn.
A more effective approach is to focus on moving the U.S. further up the value chain through innovation and value-added production. Returning to a 1950s—or even 1850s—style economy is not the solution. Just ask the British.
Tesla is beginning to feel the impact. VW, BMW and the Chinese are beginning to drive Tesla sales and market share lower by nearly half…all around the world. Once again, the US will have a dominant US brand needing protection while the non-US countries will have dozens of better made and cheaper products that are globally competitive.
Note: All comments are purely economic and investment observations and not driven by any political ideology.
Views are the author’s as of March 25, 2025 and are not investment advice.