A Protectionist Rant from Intel Legend Andy Grove

A Protectionist Rant from Intel Legend Andy Grove

Sometimes I naturally assume that most “startup minded” people are folks who lean fairly strongly towards the free market.  They typically are tolerant of government at best, and hostile towards it at worst (and I myself, I admit, lean towards the latter!)

So when my wife sent along this guest column Intel legend Andy Grove penned for Bloomberg, I was quite surprised to see his conclusion and take.  For starters, he argues that startups don’t create jobs – scaling does.  Fair enough on that one, I think.  I’ve been doing a startup for 3 years and haven’t yet pulled an actual dime out of the company yet, so my experience to date would concur!

Grove says the US employment problem is that the scaling takes place overseas…namely manufacturing, which largely takes place in Asia.  And that’s when he really gets on the rant:

The first task is to rebuild our industrial commons. We should develop a system of financial incentives: Levy an extra tax on the product of offshored labor. (If the result is a trade war, treat it like other wars — fight to win.) Keep that money separate. Deposit it in the coffers of what we might call the Scaling Bank of the U.S. and make these sums available to companies that will scale their American operations. Such a system would be a daily reminder that while pursuing our company goals, all of us in business have a responsibility to maintain the industrial base on which we depend and the society whose adaptability — and stability — we may have taken for granted.

I fled Hungary as a young man in 1956 to come to the U.S. Growing up in the Soviet bloc, I witnessed first-hand the perils of both government overreach and a stratified population. Most Americans probably aren’t aware that there was a time in this country when tanks and cavalry were massed on Pennsylvania Avenue to chase away the unemployed. It was 1932; thousands of jobless veterans were demonstrating outside the White House. Soldiers with fixed bayonets and live ammunition moved in on them, and herded them away from the White House. In America! Unemployment is corrosive. If what I’m suggesting sounds protectionist, so be it.

You can read Grove’s entire Bloomberg piece here.

As a pure free market guy, I have a hard time EVER being in favor of protectionism.  I think ultimately everyone loses.

But then again, I’m not exactly Andy Grove.  So what do you think?  Do you agree with Grove?  Or has he been spoiled from the fact that his splendid career took place during a Golden Age in American history?

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