A Liberalism That Builds Power

The goals of domestic supply chains, good jobs, carbon reduction, and public input are inseparable.

By David Dayen

In December 2021, the U.S. shipped seven million tons of liquefied natural gas (LNG), more than market champions Qatar and Australia. An explosion at the Freeport LNG terminal in June 2022 was the only thing keeping the U.S. from solidifying its position as the world’s largest exporter, and once Freeport came back online in February 2023, exports hit new records for two straight months.

Six years earlier, the country was a net importer, and only one port in Alaska could ship LNG abroad. In February 2016, Sabine Pass in Louisiana became the first active export terminal in the Lower 48 states. LNG export capacity subsequently climbed from next to nothing to a peak of 14.1 billion cubic feet per day. In 2015, the U.S. exported 28.3 billion cubic feet of LNG; just in February of 2023, it exported 326.2 billion.

In short, America built a complex industry virtually from scratch into the global leader in six years, under today’s permitting rules and approval processes, with the same standards for public participation, through companies that had no guarantee of profitability. Seven different terminals were built or expanded in the past half-decade, with at least 16 more projects in the pipeline.

You may not like the proliferation of LNG, which expends energy to chill and degasify, releases prodigious amounts of carbon pollution, causes health hazards for local communities, and is fueled by private equity. What you cannot say is that this industry is the product of a country that has forgotten how to build. A mix of national policy, willing financing, and economic and political power easily overcame whatever lethargy is judged to be endemic to the U.S. system.

The Biden administration is trying to generate a similar dynamic to expand clean energy and critical technology industries. Three major laws—the Infrastructure

Investment and Jobs Act (IIJA), the CHIPS and Science Act, and the Inflation Reduction Act (IRA)—aim to subsidize domestic manufacturing and the supports underlying it. In the first few months, the public outlays have been matched by a surge of private investment, faster than any analyst expected.

Unlike with other economic interventions, the Biden administration has strived to hit multiple policy goals in implementing these laws. Grants from the Department of Energy to support battery minerals projects require a community benefits plan, with labor and stakeholder engagement, diversity goals, and support for marginalized groups. Department of Commerce subsidies for domestic semiconductor facilities under the CHIPS Act had applicants lay out plans for access to child care. And Biden’s team is wielding other tools, like incentive bonuses, Buy and Build America mandates, prevailingwage requirements, and even profit-sharing schemes, to make sure this industrial revolution benefits workers and communities, not just executives and financiers.

This has spurred a backlash from corners of the center-left punditocracy. Combining domestic manufacturing, decarbonization, union jobs, and economic justice muddles the picture, say opinion leaders (and Prospect alumni) Ezra Klein and Matthew Yglesias. They believe that initiating “a liberalism that builds” demands precisely the opposite approach: loosening cumbersome bureaucracy, diminishing public input, and tearing down any barrier to the national abundance we need. These traditionally libertarian preoccupations are finding purchase among self-described “supply-side progressives.”

For the past few months, I’ve talked to dozens of people inside and outside of government about this dichotomy. More important, I’ve talked to labor leaders, community organizers, investors, and businesses that are operating under the terms of the administration’s strategy. What emerges is not a picture of an America shackled by the bonds of stifling environmental regulation and domestic content requirements, to say nothing of its allegedly air-tight labor laws.

For decades, America delivered economic development subsidies without strings attached. Wall Street–fueled private corporations were first in line for those gifts, and they hoarded them. Whatever cheap goods or McJobs we got out of that transaction meant little without the shared prosperity and sustainability that America needs.

A better option involves the government actively supporting the very groups that have been left out of past economic transitions, building the necessary coalition for long-term transformation. Success is not guaranteed—democracy is difficult—but the laissez-faire approach guarantees failure. In order to actually remove the barriers that have hollowed out our industrial base, the answer is not a liberalism that builds, but a liberalism that builds power.

A couple of years ago, the United Steelworkers of America heard about an incipient project to build a nickel mine in northeastern Minnesota. Before they could get a chance to organize around it, the project’s leaders called them. “The company actually approached us and said, ‘We’ve had positive working relationships with the Steelworkers at other places,’” said Anna Fendley, director of regulatory and state policy for the union.

The company, Talon Metals, was formed by expatriates of Rio Tinto, a multinational mining conglomerate. Rio had planned to sell a 31,000-acre site near Tamarack, Minnesota, with large deposits of high-grade nickel, as well as copper and cobalt. The exploration team on the project saw the potential, and signed an earn-in agreement to take over the mine, with Rio serving as a minority partner. A separate processing facility would be the first for nickel in the United States. Later, Talon reached agreement with Tesla, which needs nickel for its EV batteries, to supply 75,000 metric tons of nickel concentrate over six years, once operations begin (the current estimate is 2026).

Total Unit Closings of Top 200 Builders, 2007–2017

The project, which will create roughly 450 jobs, was always going to be politically fraught. Hardrock mining is the leading industry for toxic waste in the United States, according to the Environmental Protection Agency, with particular concern over contamination of watersheds by sulfuric acid and heavy metals. The headwaters of the Kettle and Tamarack Rivers happen to be near the mine; the former feeds into the St. Croix River, and the latter into the Mississippi.

Plus, while the town of Tamarack is sparse (less than 100 people, per the 2020 census), the Mille Lacs Band of Ojibwe tribe lives about a mile away. They survive on well water, lake fish, and the wild rice that grows along the lakes. The tribe calls the rice “manoomin,” and it’s an important agricultural, historical, and cultural product.

“The area has beautiful pristine wetlands that serve as a water recycling hydrological system,” said Kelly Applegate, commissioner of natural resources for the Mille Lacs Band. “If those were to get polluted it would impact us, our way of life.”

As The New York Times reported last year, Talon sits at the crossroads of industry formation, community skepticism, job creation, and environmental stewardship. To attract support, the company has given the impression of leaning into all these issues.

The Natural Gas Export Boom

Liquified U.S. Natural Gas Exports

It signed a union neutrality agreement with the Steelworkers, and partnered with them on a joint workforce training and development center to ensure a steady supply of skilled employees. Fendley said it’s easier to recruit to a rural area if both labor and management are promising a good job.

Talon sees it as a way to meet diversity goals, by recruiting among tribes or local refugee communities. Talon also has committed to a draft project labor agreement for both the mine and the processing facility, which will set wage scales, work rules, and employer contributions to training. “This project with Talon is the idea that a union and a company can have the same goals,” Fendley said.

Talon is going through environmental review in Minnesota, which includes an extensive public comment period. The company believes it can use technology to limit harms. It is working with a partner called EnviCore on a technique that limits mine waste, known as tailings, by turning it into cement mix. It has provided financial assurances to help close the mine when it winds down operations. And Talon decided to move the processing facility and waste removal to Mercer County, North Dakota, where they believe the drier climate will lessen the possibility of environmental spoilage.

“Moving processing and waste storage, that’s directly responsive to what we heard about from the tribes,” said Todd Malan, chief external affairs officer at Talon. “It’s costing us money and changing our economics on the project to rail product 450 miles to North Dakota. But if people feel that we listened to them, they’re more open to the idea of a mine.”

Applegate stressed that the Ojibwe, a sovereign tribal government, has only engaged in information-sharing with Talon, not deeper discussions. A mining plan has not yet been submitted, with the kind of data that could verify the company’s claims about environmental impacts.

Nevertheless, Talon listed all of these actions in their Department of Energy application for the North Dakota processing plant, which won them a $114 million grant through the IIJA . In a tribal engagement and consultation statement, Talon committed to work toward benchmarks for “tribal employment, procurement from tribal owned businesses and other forms of economic benefit sharing.” Malan said this offer drew upon the experience in Canada, where tribes have taken equity stakes in projects, purchased trucks and leased them to mining companies, or installed renewable energy and sold power to the firm.

“I don’t want to come to the table where they say, ‘We’re concerned about the environment and wild rice,’ and I talk about good jobs,” Malan said. “That’s a non sequitur. We can say, ‘Here’s what we will do on the environment. And also, we want to provide community benefits.’”

The Ojibwe tribe remains concerned. Applegate cited the recent rash of highprofile train derailments to emphasize the risk of locating the processing facility elsewhere. He acknowledged the shared goal of minimizing carbon emissions and climate change, which is also threatening the wetlands. “But we should not be asked to trade one form of pollution over another,” he said. The economic benefits didn’t seem to be a consideration. “We’re more concerned about being able to hand off this land and this water in a good way to our future generations, so they can practice their traditions.”

In March, the tribe launched a website, waterovernickel.com.

Malan acknowledged that Talon’s promises may not sway everyone. But he said the company was trying to build a model for supplying the energy transition, welcoming a unionized workforce, and extracting needed resources sustainably, all at once. Talon sees the strategy as the only path to facilitating the broad-based community support that a long-term project needs. Federal funding and direction has helped to validate the effort, Malan said. “For people in the community, it feels like they’re contributing to something with a purpose.”

Klein has coined the phrase “everythingbagel liberalism” for the kind of multi-varied approaches like Talon is taking, arguing that one too many goals, even praiseworthy ones, “adds obstacles, expenses and delays,” and frequently accomplishes nothing in the name of accomplishing it all. Besides, trying to bring the coalition together can lead to unnecessary delays. Better to pick one objective and work toward it, and excise the other obstacles to progress.

If the buildup of boxes to check were truly a barrier, we would likely see reticence from firms to comply. But instead, there’s been a line out the door.

Between last August, when the CHIPS Act and the IRA were signed, and early May, companies have announced $216 billion in private manufacturing investments, nearly 20 times the number announced before the pandemic in 2019. Manufacturing construction spending jumped from $74 billion in May 2021 to $140 billion this February. Over 100,000 jobs have already been created. Goldman Sachs predicted that IRA clean-energy tax credits will see three times higher usage than expected, and will eventually bring in $3 trillion in private investment. The CHIPS Act grant process, which includes equitable workforce goals, supply chain diversity, climate pledges, community investments, and access to child care, received 200 statements of interest from applicants in the first two months.

This suggests that, for all the explanations about why America cannot build anything or sustain homegrown industries, maybe the only needed kick start was a little public funding with criteria for community benefits. “When we were putting together our modern American industrial strategy, we said policy certainty will help crowd in private investment,” said Sameera Fazili, who worked at the National Economic Council in the first two years of the Biden administration. “We’re seeing some indications that our theory was right.”

In fact, the more you try to decipher the real obstacles to industrial and infrastructural capacity in recent years, the more you reach the conclusion that they primarily have to do with two factors: money and power.

For example, a classic “supply-side progressive” argument goes that zoning rules make it illegal to build multifamily housing in much of the country, leading to sprawl and undersupply and spiking home prices. In addition, community input offers far too many veto points from loosely organized homeowners, who are incentivized to restrict building to preserve property values.

That is all absolutely true, and some areas seeing the most affliction—my home state of California in particular—are belatedly trying to do something about it, with a series of legislative actions to force upzoning and increase supply. But there can be no doubt as an empirical matter that the greatest source of undersupply in housing in the past 20 years came from not a zoning rule or community outcry, but the impact of the Great Recession. In 2007, the top 200 builders closed over 389,000 units; within two years, that was cut by more than half, and even in 2017, a decade later, only around 327,000 units were built.

Because we have limited public funding for housing in America, we are at the mercy of the free market. With no social-housing sector, whenever private developers pull back, affordability suffers. And when the housing bubble collapsed, for-profit homebuilders resisted risking capital on what was seen as a hazardous business.

A decade of consolidation ensued, with firms either closing or pairing with bigger rivals. “You had pipe farms, suburban developments with just the pipes sticking out of the ground,” said Dan Immergluck, a professor at Georgia State University and author of Red Hot City, about the Atlanta housing market. “That causes the labor to migrate.” Suppliers fled too. So when the pandemic hit, the system was so fragile that doors and windows and lumber became hard to come by, along with the workers to install them.

Just as housing starts were starting to bounce back in 2022, Federal Reserve interest rate hikes made it more expensive to build, and starts plummeted again. This is starting to crop up in manufacturing as well, as public tax credits that require upfront investment simply stretch less in a high-interest-rate environment. Today, one big obstacle for LNG export terminals is rising interest rates eating away at up-front financing. Cost of capital is what will ultimately tip decisions on whether to build, outside of social housing or nationalized factories. “You need these policy levers rowing in the same direction to be effective,” said Todd Tucker, director of industrial policy and trade at the Roosevelt Institute. “If Jay Powell kneecaps the IRA at every step that’s going to be a problem.”

Another barrier identified by the liberal supply-siders is the extended permitting process, mandated through well-intentioned laws like the National Environmental Policy Act (NEPA). Again, this didn’t seem to stop a powerful industry like natural gas. A further set of research argues that lack of manpower at the agencies that conduct NEPA reviews was a bigger component of delay.

The biggest source of trouble in permitting, everyone seems to agree, is building transmission lines to move renewable energy from where it’s produced to where it’s consumed. (One 732-mile line from Wyoming to Nevada was just approved, and the long-delayed line from Quebec to New England has been resurrected by a state court in Maine.) One of the biggest issues is cost allocation. When multiple utilities benefit from new transmission, they must decide who pays for what. A power struggle inevitably ensues. The Federal Energy Regulatory Commission has proposed rules for allocating costs, but if anything the problem involves too few rules, particularly on monopoly utilities trying to secure benefits without paying for them.

Power crops up a lot when you look at the barriers. A report from the Transit Costs Project on why constructing rail lines and subways in the U.S. is so expensive gives an important role to overstaffing of white-collar labor, also known as corporate consultants, which adds layers of bureaucracy, overbidding for materials, and variance of design to too many projects. Politically connected firms win these assignments, turn promising projects like California’s high-speed rail program to mush, and leave behind no institutional memory inside government for how to get things done.

Despite $40 billion in spending to connect all Americans to broadband, and another $45 billion on the way, millions still lack quality service, because incumbent telecoms want to get away with spending as little as possible. We could have abundant cures for all manner of diseases, but pharmaceutical firms get rich from sitting on innovation, buying rivals to snuff out potential competition. Research has even shown that housing inflation, that common theme of the supply-siders, could be attributable to concentrated ownership.

Supply-side progressives sometimes recognize power too, like when they talk about how wealthier homeowners have more influence to stop housing in their neighborhoods. But more often, they set their sights on government incompetence and the burdens of labor and environmental rules, rather than corporate power and the familiar stories of cronyism and incumbency bias.

Between the lines of their arguments is the idea that increasing manufacturing capacity should take precedence over making sure somebody has a good job. Clean-air laws that prevent 230,000 needless deaths a year must take a back seat. Safety laws that have reduced workplace injuries nearly fourfold are too onerous. Democracy—the ability for the public to express their views on matters that will affect them and get a hearing—isn’t worth the trouble.

“You’re telling people they’re not going to get anything out of it and their lives will be made worse,” said Marshall Steinbaum, an assistant professor of economics at the University of Utah. “That’s the tell that it’s not designed to build a political movement. That’s something Silicon Valley billionaires believe.”

The Biden administration’s bid to reverse these trends starts from a premise that broadly distributing both money and power is essential to meeting the nominal goal of augmenting industrial capacity. As Tucker told me, “You can’t say that the problem with what we’re doing is that it’s too publicminded, that’s the point. It’s not just about adding widgets.”

You have to go back to what triggered the rebuilding impulse in the first place. The consequences of outsourced supply to concentrated offshore locations were on full display during the pandemic, introducing hidden risk, and eventually supply shocks and inflation. Monopolistic supply chains are simply unstable. More solar and wind projects were announced in the last three months of 2022 than all of 2021, but sourcing components, most of which come from overseas, has been a struggle, and spurred the push for a domestic solar supply chain.

Arguing that domestic manufacturing will raise costs neglects the severe damage we just experienced, which can emerge through climate catastrophe, geopolitical tensions, and many other factors beyond a pandemic. Besides, high-road labor practices, which aren’t even that common in U.S. manufacturing, add negligible costs to renewable-energy projects, on the order of 1 to 2 percent.

The imperative of the climate crisis was the second emergency, and it fits with the first: Domestic supply is cleaner to produce and less carbon-intensive to ship. But it’s a monumental task: overhauling the structure of the U.S. energy system, the U.S. transportation system, the U.S. commercial and residential building system, not to mention reviving domestic mining and materials production and manufacturing. It touches absolutely everything. And to pull it off, you need maximum buy-in from all corners of the country, sustained buy-in that prevents policy rollback.

Trading $17-an-hour service-sector jobs for $17-an-hour manufacturing jobs is a sure way to destroy that coalition. “A plain-bagel strategy is not a recipe for winning,” said Ben Beachy, vice president of manufacturing and industrial policy at the BlueGreen Alliance, a labor and environmental partnership. “We will win when workers see climate action as essential, not only for the climate but for next month’s paycheck.”

The fossil fuel sector has managed to figure this out. Oil rig jobs in Louisiana and Texas are generally good, and it’s made them stickier, despite concerns about the climate. As oil companies pull back on investment and cut back on staff, workers have drifted to clean energy. Preserving broad-based support for the energy transition will require both well-paid jobs and secure careers that will be around for decades. “We’re working to eliminate a historic disparity in job quality between clean-energy and traditionalenergy jobs,” said Beachy.

Making that happen has to be a simultaneous process. If you instead offer a plainbagel approach, putting one goal ahead of the other, you end up with what Tucker calls the Elon Musk problem.

In 2009, the Obama administration inaugurated a $90 billion loan guarantee program through the Department of Energy as part of the economic stimulus to recover from the Great Recession. This was industrial policy in miniature, an attempt to incubate the industries of the future while creating jobs and economic opportunity.

One of the higher-profile loan recipients was Tesla, which received $465 million to build its Model S sedan.

Federal largesse spurred Tesla to early dominance, making electric vehicles attractive to a mass audience and spurring com- petitors to join in. But Elon Musk didn’t have to deal with the kind of standards that are being viewed with skepticism today. As a result, the market leader in electric cars, weaned on public money, proceeded to become one of the biggest union-busters in America. The only U.S. auto company using non-union workers at a stateside plant, Tesla has been criticized for years for low pay, poor safety records, and intimidation of employees seeking collective bargaining. Tesla was found guilty in 2021 of firing an employee engaged in protected union activity; other allegations of illegal firings have followed.

Not only did the failure to condition federal loans on high-road labor practices enable Tesla’s practices, it made it harder to reverse those practices with each passing year, as the company grew and entrenched itself. Plus, Tesla’s competitors feel like they can’t create good jobs either if they want to challenge the market leader. Vehicle manufacturers and their suppliers kept their production overseas, or fought unionization. Even the Big Three automakers have attempted to put EV battery production outside of their contract agreements, arguing that it’s a new technology to be bargained separately. The United Auto Workers have taken the extraordinary step of withholding support for Biden’s re-election out of concern for the drift of the EV workforce. Undoing this isn’t hopeless—workers at Ultium Cells in Ohio, who make batteries for General Motors EVs, overwhelmingly voted to join the UAW last December, and the union also just announced a neutrality agreement with Sparkz, another battery manufacturer. But that one decision to hand Tesla public money 14 years ago had longterm implications for an entire sector.

“We saw the rise of unions in the Industrial Revolution because the jobs were so bad,” said Fendley, with the Steelworkers. “Wouldn’t it be nice in this massive industrial transformation that we’re on the cusp of if we didn’t have to go down a road like that, and we made sure that jobs were highroad and union from the start?”

Biden’s first major policy preoccupation was to bring about full employment. The American Rescue Plan went out of its way to not follow the agonizingly slow labor market recovery of prior recessions. America restored all of the jobs lost in the pandemic, a deeper deficit than the country had seen in a century, in less than three years. Tightened labor markets bring leverage to workers by definition. Companies in high-impact industries must compete for talent.

The administration has supplemented that in several ways. First, they made supply chain resilience and carbon reduction national priorities. Biden set a goal of electric vehicles being 50 percent of all cars sold by 2030. The Environmental Protection Agency’s tailpipe emissions rule in April codified that goal and even strengthened it. This creates a market for battery and EV production. The administration’s historic supply chain reports last year made the case for producing them and other critical goods domestically. National priorities impact even private investment. LNG terminals must prove they can show 30 years of demand that will earn back the significant investment; those longterm demand projections are less possible in a climate-obsessed world.

Nudges were also added inside key laws, if not always firm standards. An executive order requires project labor agreements for all federal construction projects. CHIPS funding “strongly encourages” PLA s as well, though an earlier provision to require them was cut out of the final bill. The IRA’s controversial EV rebates include domestic content requirements to further guarantee that not just cars but the whole ecosystem of suppliers remains in America. The law also offers large incentive bonuses for companies that offer prevailing wages for construction, as well as qualified apprenticeship programs, which can help solve the workforce problem for companies while offering ladders to the middle class for workers.

The IRA also reserved $6 billion for technology upgrades supporting cleaner manufacturing of aluminum and steel, to reduce industrial pollution. “We can’t just forever depend on huge reliance on cheap imports to achieve climate goals. Overseas corporations tend to be more emissions-intensive,” Beachy said. The Department of Energy program guidelines, released in March, again preference applicants that not only guar- antee cuts to greenhouse gas emissions but support cleaner air for local communities.

The supply-side progressive critique misses the fact that all of these goals are mutually reinforcing. For example, the typical line from businesses is that unions will slow down operations, by protecting unproductive performers and adding burdensome work rules. The administration’s actions have flipped that on its head.

Now, unions can offer startup manufacturers a stable workforce and lower turnover rates, along with the potential for unlocking political connections and financing. And since the industrial base has been so hollowed out, experienced employees with production know-how are prized commodities who can help young companies navigate their early growth. In this sense, organized workers become brokers for the clean-energy solution, not just replaceable parts. “What we’re hearing from the private sector is, ‘Where can we find some unions?’” said Beachy.

If you get to those infant industries with upside for growth early, companies with no history of even talking to unions, you can change minds. “If we can set in place industrywide practices that show them that investing in their workers can add to the firm, we’ll be able to add these practices earlier as they grow,” said Fazili.

The biggest victory for this strategy came at an electric school bus factory in rural Georgia , where 1,400 workers won a union election in mid-May. Blue Bird, which received funding through the IIJA’s clean school bus program, had to comply with an Environmental Protection Agency condition that barred recipients from funding outside antiunion campaigns. In a right-to-work state, those restrictions leveled the playing field.

Over 90 percent of private-sector manufacturing jobs are non-union; increasing union activity can restore organizing muscle across sectors. Most unionized steel and aluminum facilities are located in disadvantaged communities; reducing pollution from these factories would improve air quality in neighborhoods that have needed that for years, while protecting the climate and creating good union jobs.

Similarly, the child care crisis and workforce needs fit together to uplift a unique class of Americans.

In Mississippi, Methodist minister Carol Burnett (yes, that’s her real name) directs two nonprofits dedicated to bringing women, primarily single mothers, into the construction industry, where wages are higher than in traditionally female professions. “Single moms are the population in our state where poverty is most concentrated, even though single moms have higher labor force participation rate in the state,” she told me.

The Women in Construction program in Biloxi started after Hurricane Katrina, another time of acute workforce needs. The program trained women to rebuild and renovate homes devastated by the storm. Enhanced with funding from the Depart- ment of Labor and philanthropic foundations, Women in Construction expanded into advanced manufacturing and commercial construction. Staff members are now training single mothers in four districts, helping with credentialing, job placement, and child care needs along the way. “We haven’t achieved equity or anything but we’ve made a lot of progress,” Burnett said. “The experience has demonstrated that women can work when one earns enough money.”

Major construction industries in Mississippi include Ingalls Shipbuilding, a federal contractor, as well as oil and gas firms and commercial builders. The state is notoriously unfriendly to unions, environmental rules, and decent wages. Yet Burnett has made some headway with large employers by framing the child care issue as about increasing the employee base. She explained how the state’s workforce development agency, Accelerate MS, received a grant through the American Rescue Plan to fund support services for single parents, including child care.

“There are really a larger number of people at all levels who are beginning to understand that child care is a challenge, and trying to address it is a good thing to get more employees in the door,” Burnett said. The CHIPS Act directives on child care, which simply require companies seeking federal money to look around for access near site locations, can be seen in that context. With women only 10.6 percent of the construction workforce, they are an untapped option for expanding the employee base. And making workforce decisions that maximize available labor can benefit workers and the company alike.

One of Fazili’s major initiatives at NEC was to increase the trucking workforce, amid pandemic-era labor shortages. Decades of deregulation made the jobs unattractive. “People were so used to thinking of labor and management in opposition to one another,” she said. The administration initiatives, she said, “creates new incentives for folks to work together and for management to realize there’s real value in collaboration.”

These efforts are not fated to succeed, because nothing requiring cooperation ever is. The Defense Department didn’t have a strategy of adding conditions when it helped build the semiconductor industry in the 1970s. Today, the majority of the most advanced chips come from one island and one firm, Taiwan Semiconductor Manufacturing Company (TSMC). Its founder, Morris Chang, referred to American hightech companies in a 2016 interview, stating bluntly: “When you look at why those companies are successful, I think them not having unions is a big part of it.”

Sure enough, as TSMC builds a chip factory in Arizona with public funding support, they have resisted Commerce Department guidance, and labor has been frozen out. “There is zero interest in doing business with us,” the president of Arizona’s building trades told the Prospect in April. Out-of-state, nonunion workers are building the facility. Though chip companies have started to fight one another over subsidies, suggesting that they could be persuaded to distribute benefits broadly, the government has little leverage to dictate to the small handful of players in the industry, which they’re practically begging to set up shop in America. “Some of these chip firms can walk away from the table in a way that cash-hungry firms can’t,” said Tucker. That’s why the administration’s competition agenda is a component of its industrial policy; more semiconductor firms can bring in new ideas and break the industry’s rigid stances.

But also, Congress had no interest in writing labor neutrality requirements into CHIPS, which would have helped immensely. It’s led to the soft-pressure approach that the Commerce Department has laid out, attempting to show firms that it’s in their interest.

Similarly, the reason you see the vast majority of the investment flowing into red states and red districts is that it lines up with states that have right-to-work laws. That’s also not an impossible hurdle—the Steelworkers secured their neutrality agreement with Talon Metals in right-to-work North Dakota—but it’s a heavier lift when the manufacturing hubs of the future are in the Deep South, or areas where wages and benefits are low by design.

On the flip side, that’s a coalition-building opportunity. One of the biggest solar manufacturers in the U.S., Hanwha Qcells, set up shop in the district of Rep. Marjorie Taylor Greene (R-GA) and later expanded the plant and added another one in a neighboring red district, with a $2.5 billion investment praised by Vice President Kamala Harris. That puts Greene in a difficult position when Republicans fight to extinguish clean-energy tax credits. The workers in that factory become citizen lobbyists against Republican anti-renewable sentiment. And building out a hint of acceptance in the GOP for these policies, as has been done with wind power in Texas and Iowa, insulates the policy to an extent.

Finally, there are the impossible yet inescapable conversations with the kinds of communities traditionally disadvantaged by industrial production, who don’t particularly want to be—and shouldn’t be—human sacrifices on the altar of the energy transition. “So many times, history repeats itself,” said Applegate, of the Mille Lacs Band in Minnesota. “Industry comes in, taking our land, our trees, moving us onto reservations.” Somehow, slow permitting didn’t stop that from happening.

Community benefits agreements that give disadvantaged communities a stake in future industrial projects, from targeted hiring to environmental mitigation, ensure more equity. Mines, transmission lines, utility-scale solar and wind, battery factories, and other pillars of this strategy, if successful, will be in neighborhoods for decades. The short-term need to win acceptance from the people who have to live next to them will pay long-term dividends.

There’s something uniquely un-American about the alternative. “A liberalism that builds boils down to the idea that people can’t be trusted,” said Steinbaum. “Elites must make the sound enlightened decisions because they don’t trust democracy or politics.” Supply-side progressives like Yglesias and Klein are skilled at detecting the structural problems in American government. They’re less concerned with the problem of power as an impediment to progress. And they’re certainly not interested in equalizing that power, aligning the interests of labor and capital, as the clearest path to deal everyone into a next-generation economy.

For all the struggles that Talon Metals has had gaining support in Minnesota, their executives at least sound like they understand this. “Community support has to be built across all these projects,” Todd Malan told me. “They put us through the wringer, and keep us accountable.”

Most communities will gain from better jobs and opportunity, cleaner air, resilient supply chains, and a climate that isn’t spinning out of control. And they have even more to gain from equalizing the power dynamics that have pummeled their communities. So does a political system that has struggled with the disruptions of inequality and deindustrialization for the past halfcentury. Instead of trying to restart the bulldozers that outsourced and deregulated and got us into this mess, we can build a base for a mass politics, the only base that will sustain the generational effort of standing up a new economy. n