At a certain level it can lead otherwise competitive companies to rest on their laurels.
On another level, it would be game over without them. For example, US shipyards would simply stop existing without protection. There is no management strategy or measure they could implement that could compete with Asian shipyards.
The theory is that in both cases (ie. with and without tariffs) shipyards are going to die sooner or later. It is better for the society to let them die as soon as possible and direct efforts to things we are better at while taking advantage of cheaper ships produced elsewhere.
Some industries are of national security or other strategic value, so protecting them even if that means some stagnation is desirable over the offshoring of said industry.
The question is: how do you define "national security" and "other strategic value"? At the end of the day both really mean economic interest. Especially in case of US.
So if someone says "national security" is above economic interest of US, I would say these people mean _their_ economic interest is above economic interest of US and use both terms as a cover.
> Insofar as the country being conquered and Americans being slaughtered wholesale would be against our economic interests lol
> There are clear national security reasons for the government to prop up shipbuilding and semiconductors.
Are you saying countries without shipbuilding facilities or not producing semicondutors are being conquered and their citizens being slaughtered?
I'd say that is fear mongering done by the people doing business on "national security".
> Are you saying countries without shipbuilding facilities or not producing semicondutors are being conquered and their citizens being slaughtered?
Yes that is a clear risk. For most of human history, powerful leaders have unleashed violence on their neighbors to increase their wealth and prestige. For about 70 years, the cold war balance prevented very catastrophic wars between powerful nations but we now seem to be having an atavistic throw back of powerful nations being led by expansionist leaders. You either need to create your own manufacturing capacity or be at the mercy of others.
You can call it fearmongering but I can point to the whole of human history and tell you that not only has it happened, at a certain point it is inevitable. I can point at Ukraine, right now, as an example of what happens when one country appears much weaker than an aggressive neighbor.
The United States is the greatest power the world has ever seen. While the oceans protect us, the truth is that even the White House was once burned down in a war.
The economic interest is the US ability to as rapidly as possible convert those shipyards to military shipyards during a large scale prolonged war. The US did not make (relatively) many ships before WW2 and then during WW2 was briefly the largest ship builder in the world.
> The economic interest is the US ability to as rapidly as possible convert those shipyards to military shipyards during a large scale prolonged war.
Nah, that doesn't add up. US needs _ships_ and SOTA military equipment to make sure that any military conflict is as short as possible (ie. US wins). Losing money on unused production capability does not make sense because in case of prolonged conflict there is time to build the capability (as it happened during WWII).
In reality, what you call "prolonged military conflict", is nothing more than normal international competition. One could even argue US is in prolonged military conflict since WWII.
In which case making rational decisions based on hard economic criteria (ie. not losing money) is the key to success.
Sure I can see the argument for national security. And to balance out Chinese companies own rent seeking.
OTOH still strategically it’s not great. As the Asian companies have an actual market, this will lead Asian manufacturers to have better ships than comparable US ones.
On another level, it would be game over without them. For example, US shipyards would simply stop existing without protection. There is no management strategy or measure they could implement that could compete with Asian shipyards.