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Barely a week goes by without Donald Trump announcing a new public investment or industry-specific subsidy. Late last month, the Trump administration committed to investing $80 billion in nuclear power. A day earlier, the United States and Japan agreed to a robust set of investments in critical mineral production, an extension of the pattern of direct investments the U.S. government has already made. Meanwhile, the government is now the largest stockholder in Intel and worked with Nvidia to suspend export controls on certain high-powered chips to China.
Some observers have described these actions as a new “economic nationalism,” citing the administration’s prioritization of domestic economic interests over international economic integration. But that term fails to explain what makes this administration’s decision-making unique.
Other writers call it “state capitalism.” But that projects too much coherence onto what so far has been an idiosyncratic collection of half-step policies.
Or could this be marketcrafting, the term I often use to think about a broad history of state action shaping markets toward the public interest? It isn’t—yet. Marketcrafting requires a particular economic goal, and a coordinated effort to use the tools of public policy to shape the market toward the public interest. Trump’s economic agenda looks to enhance presidential power in pursuit of an independent, even self-sufficient, economy.
Trump’s economic policy is best understood as rule by deal. He makes ad hoc agreements with domestic companies, and deals with foreign nations that benefit particular businesses the president favors. Each deal is individually negotiated, unpredictable, and contingent on executive favor. Lacking clear policy goals and without a coordinating institution to enforce the terms of the agreements, many of these commitments may end up being as thin as the paper the press release announcing them was printed on. |
