{"id":139440,"date":"2025-01-14T14:19:00","date_gmt":"2025-01-14T18:19:00","guid":{"rendered":"https:\/\/www.shortform.com\/blog\/?p=139440"},"modified":"2025-01-14T15:30:36","modified_gmt":"2025-01-14T19:30:36","slug":"economic-nationalism","status":"publish","type":"post","link":"https:\/\/www.shortform.com\/blog\/economic-nationalism\/","title":{"rendered":"Economic Nationalism: Its History &#038; Potential Future"},"content":{"rendered":"\n<p>What does economic nationalism mean for America&#8217;s future? How might this shift in economic policy affect your daily life?<\/p>\n\n\n\n<p>Economic nationalism is reshaping both US politics and global trade relationships. From manufacturing to consumer prices, this growing movement impacts everything from job markets to the cost of everyday goods.<\/p>\n\n\n\n<p>Keep reading to discover how this pivotal economic shift could transform America&#8217;s position in <a href=\"https:\/\/www.shortform.com\/blog\/globalization-and-economy\/\">the global economy<\/a> and what it means for your wallet.<\/p>\n\n\n\n<!--more-->\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-economic-nationalism\">Economic Nationalism<\/h2>\n\n\n\n<p>Economic nationalism became <a href=\"https:\/\/www.washingtonpost.com\/business\/2024\/07\/17\/trump-vance-economy-workers\/\" target=\"_blank\" rel=\"noreferrer noopener\">a central issue in the 2024 US presidential race<\/a>, challenging decades of globalization-focused policies. Both major political parties embraced aspects of economic nationalism but with different approaches and degrees of implementation. The next administration faces a pivotal choice that will significantly shape US economic policy and international trade relations.<\/p>\n\n\n\n<p>We\u2019ll explore what economic nationalism is, who supports it, who opposes it, and how it might shape US policy.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-what-economic-nationalism-is\">What Economic Nationalism Is<\/h3>\n\n\n\n<p>Economic nationalism prioritizes a country&#8217;s own economic interests through policies that protect and promote domestic industries over global market considerations. Key aspects of economic nationalism include:&nbsp;<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><a href=\"https:\/\/www.sciencedirect.com\/topics\/social-sciences\/economic-nationalism#:~:text=Economic%20nationalism%20places%20great%20emphasis,by%20a%20highly%20regulated%20economy\" target=\"_blank\" rel=\"noreferrer noopener\"><strong>Robust government intervention in the economy<\/strong><\/a> to safeguard and promote national economic goals.<\/li>\n\n\n\n<li><a href=\"https:\/\/www.investopedia.com\/terms\/p\/protectionism.asp\" target=\"_blank\" rel=\"noreferrer noopener\"><strong>Protectionist measures<\/strong><\/a>, such as tariffs and quotas, to shield home-grown industries from overseas rivals.<\/li>\n\n\n\n<li><strong>Support for domestic industries<\/strong> through financial aid or incentives to boost domestic companies\u2019 global competitiveness.<\/li>\n\n\n\n<li><a href=\"https:\/\/www.cliffordchance.com\/content\/dam\/cliffordchance\/briefings\/2011\/12\/resource-nationalism.pdf\" target=\"_blank\" rel=\"noreferrer noopener\"><strong>Control of resources and industries<\/strong><\/a> vital for national security and prosperity.<\/li>\n\n\n\n<li><strong>Emphasis on self-reliance<\/strong> through bolstered domestic capabilities and reduced dependency on foreign economies.<\/li>\n<\/ul>\n\n\n\n<figure class=\"wp-block-table\"><table><tbody><tr><td><strong>The Danger of Protectionism<\/strong><br><br>In <a href=\"https:\/\/www.shortform.com\/app\/book\/naked-economics\/preview\" target=\"_blank\" rel=\"noreferrer noopener\"><em>Naked Economics<\/em><\/a>, Charles Wheelan writes that people sometimes decide globalization is the source of their problems and rebel against it, demanding protectionist policies to shield themselves from foreign competitive pressures.<br><br>When a government institutes protectionist policies, it puts up barriers to trade. These can be in the form of taxes, tariffs, quotas, regulations, or sanctions. These barriers keep foreign goods and services out of a country, thereby protecting the country\u2019s own industries from competition. However, domestic firms protected from competition have few incentives to innovate, increase productivity, or lower prices, and consequently, economies with many protectionist policies in place typically grow stagnant and expensive for consumers.<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-economic-nationalism-in-history-nbsp\">Economic Nationalism in History&nbsp;<\/h3>\n\n\n\n<p>Economic nationalism emerged in the 19th century <a href=\"https:\/\/www.elgaronline.com\/edcollchap\/book\/9781789909043\/book-part-9781789909043-9.xml\" target=\"_blank\" rel=\"noreferrer noopener\"><strong>to protect weaker economies against industrial giants<\/strong><\/a><strong>. <\/strong>It gained traction <a href=\"https:\/\/www.globalpolicyjournal.com\/articles\/world-economy-trade-and-finance\/economic-nationalism-theory-history-and-prospects\" target=\"_blank\" rel=\"noreferrer noopener\">after the 1929 economic crisis<\/a> and spread post-World War II amid economic turmoil and rising nationalism.&nbsp;<\/p>\n\n\n\n<p>Countries implemented economic nationalism through various government interventions, including state control of industries, tariffs, and a push for self-sufficiency, with approaches <a href=\"https:\/\/dusp.mit.edu\/projects\/economic-nationalism\" target=\"_blank\" rel=\"noreferrer noopener\">varying by nation and sector<\/a>. But, as global trade expanded, maintaining purely national economies <a href=\"https:\/\/www.globalpolicyjournal.com\/articles\/world-economy-trade-and-finance\/economic-nationalism-theory-history-and-prospects\" target=\"_blank\" rel=\"noreferrer noopener\">became increasingly challenging<\/a>.&nbsp;<\/p>\n\n\n\n<p>The 21st century has seen a<strong> <\/strong><a href=\"https:\/\/www.discoursemagazine.com\/p\/the-rising-influence-of-economic-nationalism\" target=\"_blank\" rel=\"noreferrer noopener\"><strong>resurgence of economic nationalist ideas<\/strong><\/a><strong>, particularly in response to globalization and the 2008 financial crisis.<\/strong> The effectiveness of economic nationalism remains hotly debated in today&#8217;s interconnected global economy.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-economic-nationalism-now\">Economic Nationalism Now<\/h3>\n\n\n\n<p>Economic nationalism&#8217;s revival is transforming both the US and global economic landscapes in the following key ways:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><a href=\"https:\/\/www.schoolofpublicpolicy.sk.ca\/research-ideas\/publications-and-policy-insight\/policy-brief\/economic-nationalism.php\" target=\"_blank\" rel=\"noreferrer noopener\"><strong>Industrial strategy<\/strong><\/a>. Countries are pushing for self-sufficiency, prioritizing domestic sectors. For example, the US is focusing on key industries such as chip manufacturing in response to China&#8217;s economic competition.<\/li>\n\n\n\n<li><strong>Trade patterns. <\/strong>As major economies like the US adopt nationalist policies, global trade is being disrupted. This could lead to a more fragmented world economy with new trade barriers.<\/li>\n\n\n\n<li><strong>Consumer costs.<\/strong> Economic nationalist policies, such as higher tariffs and reduced foreign competition, could lead to increased prices for consumers.<\/li>\n\n\n\n<li><a href=\"https:\/\/www.discoursemagazine.com\/p\/the-rising-influence-of-economic-nationalism\" target=\"_blank\" rel=\"noreferrer noopener\"><strong>Policy shift<\/strong><\/a>. There&#8217;s a marked departure from post-World War II liberal economic policies, with national interests increasingly prioritized over global cooperation.<\/li>\n\n\n\n<li><a href=\"https:\/\/www.piie.com\/blogs\/realtime-economic-issues-watch\/rise-economic-nationalism-threatens-global-cooperation\" target=\"_blank\" rel=\"noreferrer noopener\"><strong>Diplomatic challenges<\/strong><\/a>. Nations face a delicate balancing act between implementing nationalist economic policies and maintaining crucial international alliances.<\/li>\n<\/ul>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-supporters-of-economic-nationalism\">Supporters of Economic Nationalism<\/h3>\n\n\n\n<p>Economic nationalism has gained support across the political spectrum, with prominent figures advocating various approaches to these policies:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><a href=\"https:\/\/www.tandfonline.com\/doi\/full\/10.1080\/13501763.2023.2226168#d1e235\" target=\"_blank\" rel=\"noreferrer noopener\"><strong>Public opinion<\/strong><\/a>. American voters across party lines have shown significant support for economic nationalist policies, with national survey data indicating that many favor increased import restrictions and view countries such as China as economic threats.<\/li>\n\n\n\n<li><a href=\"https:\/\/www.tandfonline.com\/doi\/full\/10.1080\/13501763.2023.2226168#abstract\" target=\"_blank\" rel=\"noreferrer noopener\"><strong>The Biden-Harris Administration<\/strong><\/a> embraced aspects of economic nationalism through initiatives such as <a href=\"https:\/\/www.whitehouse.gov\/build-back-better\/\" target=\"_blank\" rel=\"noreferrer noopener\">&#8220;Build Back Better<\/a>&#8221; and &#8220;<a href=\"https:\/\/www.whitehouse.gov\/invest\/\" target=\"_blank\" rel=\"noreferrer noopener\">Investing in America<\/a>.&#8221; This approach prioritized development, including infrastructure investment, onshoring critical industries, and strengthening US manufacturing. The administration aimed to bolster the domestic economy while maintaining international alliances but put off new trade agreements until national economic goals are met.<\/li>\n\n\n\n<li><a href=\"https:\/\/www.tandfonline.com\/doi\/full\/10.1080\/13501763.2023.2226168#abstract\" target=\"_blank\" rel=\"noreferrer noopener\"><strong>Donald Trump<\/strong><\/a> promoted economic nationalism through tariffs and his &#8220;America First&#8221; agenda during his first term. As the Republican presidential nominee in 2024, he attempted to <a href=\"https:\/\/www.washingtonpost.com\/business\/2024\/07\/17\/trump-vance-economy-workers\/\" target=\"_blank\" rel=\"noreferrer noopener\">balance economic nationalism with traditional GOP pro-business policies<\/a>.&nbsp;&nbsp;<\/li>\n\n\n\n<li><a href=\"https:\/\/www.washingtonpost.com\/business\/2024\/07\/15\/vance-trump-economy-gop\/\" target=\"_blank\" rel=\"noreferrer noopener\"><strong>JD Vance<\/strong><\/a>. Vance represents a growing faction within the GOP that embraces economic nationalism. His support for tariffs, skepticism of free trade, advocacy for <a href=\"https:\/\/www.shortform.com\/blog\/government-intervention\/\">government intervention<\/a> in key industries, and emphasis on protecting American workers mark a significant departure from traditional Republican free-market ideology.<\/li>\n<\/ul>\n\n\n\n<p>(Shortform note: In July 2024, JD Vance appeared as a guest in <a href=\"https:\/\/www.shortform.com\/app\/podcast\/episode\/the-ben-shapiro-show-audacious-its-jd-vance-for-vp\/preview\" target=\"_blank\" rel=\"noreferrer noopener\">an episode of <em>The Ben Shapiro Show<\/em><\/a>. He discussed his unconventional economic positions, which favor protectionism and industrial policy over traditional Republican free market conservatism. In alignment with Trump, he advocated for tariffs, subsidies, and regulations to aid domestic manufacturing.)<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-opponents-of-economic-nationalism\">Opponents of Economic Nationalism<\/h3>\n\n\n\n<p>Despite the growing influence of economic nationalism, several key groups and individuals from across the political and economic spectrum remain skeptical or opposed to these policies:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><a href=\"https:\/\/www.washingtonpost.com\/business\/2024\/07\/15\/vance-trump-economy-gop\/\" target=\"_blank\" rel=\"noreferrer noopener\"><strong>Chamber of Commerce and Business Roundtable<\/strong><\/a>. These corporate interest groups reject key aspects of economic nationalism such as Trump&#8217;s trade policies and immigration crackdown, viewing them as harmful to free markets.<\/li>\n\n\n\n<li><a href=\"https:\/\/www.washingtonpost.com\/business\/2024\/07\/17\/trump-vance-economy-workers\/\" target=\"_blank\" rel=\"noreferrer noopener\"><strong>Corporate-minded Republicans<\/strong><\/a>. These party members fear losing the ability to influence and moderate Trump&#8217;s more disruptive economic nationalist policies such as tariffs, seeing them as contrary to free-market ideals.<\/li>\n\n\n\n<li><strong>Top Republican donors<\/strong>. Some major GOP contributors have indicated unease with the party&#8217;s shift toward economic nationalism, privately expressing concern that populist policies such as trade barriers and industrial subsidies could harm business interests and economic growth.<\/li>\n\n\n\n<li><a href=\"https:\/\/www.marketwatch.com\/story\/larry-summers-warns-bidens-economic-agenda-is-increasingly-dangerous-and-inflationary-23fa4704\" target=\"_blank\" rel=\"noreferrer noopener\"><strong>Larry Summers<\/strong><\/a>. The former Treasury Secretary has criticized the Biden administration\u2019s economic nationalism, arguing that manufacturing-focused policies and trade protectionism are misguided, potentially inflationary, and less effective at improving living standards than traditional free-trade approaches.<\/li>\n<\/ul>\n\n\n\n<p>(Shortform note: In <a href=\"https:\/\/www.shortform.com\/app\/podcast\/episode\/rachel-maddow-presents-deja-news-lawrence-donald-trump-is-proposing-the-worst-economic-policy-in-u-s-history\/preview\" target=\"_blank\" rel=\"noreferrer noopener\">a June 2024 episode of <em>Rachel Maddow Presents: D\u00e9j\u00e0 News<\/em><\/a>, Larry Summers called Trump\u2019s idea to use tariffs instead of income taxes potentially the worst macroeconomic policy in US history. He suggested the tariff levels that would be needed to replace even half of income tax revenue would be six times higher than the Smoot-Hawley tariffs, potentially leading to economic catastrophe.)<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-what-s-next\"><strong>What\u2019s Next<\/strong><\/h3>\n\n\n\n<p>With the transition to a new administration and Congress, economic nationalism&#8217;s trajectory remains uncertain. While some experts argue that targeted industrial policies could <a href=\"https:\/\/www.project-syndicate.org\/commentary\/east-asian-model-vindicates-economic-nationalism-by-dani-rodrik-2023-11\" target=\"_blank\" rel=\"noreferrer noopener\">strengthen the US economy without harming global trade<\/a>, others warn of <a href=\"https:\/\/www.weforum.org\/agenda\/2024\/06\/economic-fragmentation-global-tensions-experts\/\" target=\"_blank\" rel=\"noreferrer noopener\">growing fragmentation in international markets<\/a>. These conflicting viewpoints highlight the pivotal decision facing the next administration, whose policies will shape whether the US leads a new era of strategic protectionism or returns to championing global economic integration.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>What does economic nationalism mean for America&#8217;s future? How might this shift in economic policy affect your daily life? Economic nationalism is reshaping both US politics and global trade relationships. From manufacturing to consumer prices, this growing movement impacts everything from job markets to the cost of everyday goods. Keep reading to discover how this pivotal economic shift could transform America&#8217;s position in the global economy and what it means for your wallet.<\/p>\n","protected":false},"author":9,"featured_media":139446,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[81,39,275],"tags":[727],"class_list":["post-139440","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-economics","category-history","category-politics","tag-articles","","tg-column-two"],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v24.3 (Yoast SEO v24.3) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Economic Nationalism: Its History &amp; Potential Future - Shortform Books<\/title>\n<meta name=\"description\" content=\"An economic shift is reshaping US politics and global trade relationships. 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