El-Erian Urges Heavier US Economic Intervention After 40 Years of Offshoring
Updated
Updated · The American Prospect · Jul 13
El-Erian Urges Heavier US Economic Intervention After 40 Years of Offshoring
1 articles · Updated · The American Prospect · Jul 13
Summary
Mohamed El-Erian argued in a New York Times op-ed that US economic policy must shift toward “geoeconomics,” with a much heavier government role than the laissez-faire model associated with Adam Smith and Milton Friedman.
Three principles anchor his case: national economic capacity as security, strict reciprocity in trade and investment openness, and policy aimed at visibly improving American households’ welfare.
Pandemic disruptions and recent wars, he said, show the need to onshore or reshore industrial output lost over roughly 40 years of offshoring and just-in-time supply chains.
El-Erian also warned that the era of ultracheap imports is fading, meaning households—especially low-income consumers—are likely to face higher prices as resilience takes priority over pure efficiency.
The argument places Biden-era industrial policy and Trump-era tariffs in a broader shift toward state-guided economics, though the article says lasting public support would require stronger wages and worker power.