US is no longer the arsenal of democracy

For the first several decades after World War II, the United States championed free trade. Exporting sectors like agriculture benefited from it. Many economists still support it.

Much of the rest of the country has soured on it.

The economic logic behind free trade is that goods should be produced where they can be produced most cheaply. Consumers are better off. So are investors; constructing factories in uncompetitive places misallocates capital.

But some factory workers lose as production is moved offshore to lower cost venues. Heeding the public’s outcry over runaway jobs, Congressmen no longer support free-trade agreements. Presidents push tariff increases and industrial policy instead.

National-security policymakers have a different concern with free trade, one spurred by the possibility of war over Taiwan. No one wants that to happen, but if it did American industry would be hard pressed to keep our military supplied.

When the US won World War II, it was the world’s manufacturing powerhouse “the arsenal of democracy.” Consider these statistics, taken from naval historian Craig Symonds’s Teaching Company course “World War II: The Pacific Theatre.”

From 1939 to 1945, the Allies (the United Kingdom, China, the Soviet Union and especially the US) built:

• 4.4 million tanks, trucks and armored vehicles while the enemy Axis powers – Japan, Germany and Italy – built only 670,000;
• 637,000 aircraft to the Axis countries’ 229,000; and
• 55,000 ships, the lion’s share in the US, to the Axis powers’ 1,700.

The US won the war, Symonds argues, “because the United States was able to produce the tools of war, and especially the warships and the transport ships, not only faster than the Japanese but in numbers that were previously