 Be careful. Thank you everybody. Good evening. Thank you for coming along to this session here at the World Economic Forum. Welcome all. We'll get straight into it quite quickly. I'm Gerry Baker. I'm editor-at-large of the Wall Street Journal. Despite my accent, I actually recently became an American citizen. I've lived in the United States for 25 years, but it's a pleasure for me to be able to lead the discussion here on this interesting and important topic, modern supply-side economics. And I think most of us, certainly most of us from an American who've lived in America for a long time, always think of supply-side economics. It's been the watchword of conservatives for 20, 30 years. We all think of Jack Kemp, or Earl Reagan, Jack Kemp, and Newt Gingrich, and people like Paul Ryan. And their conception of supply-side economics was tax cuts, particularly tax cuts for business capital gains, tax cuts, incentivise investment, incentivise free direction of resources. Michael, please, restrain yourself, if you will. The idea was you increased the supply-side of the economy by doing all that. But of course, in the last few years, we've had this pretty remarkable, I think it's fair to say, economic policy at least transformation in the United States, led by Joe Biden's administration, these extraordinary measures. And again, by the way, this is, of course, an administration with a very, very narrow majority in the Congress. Not many people thought a lot would get done, but they passed successive major economic policy measures. Michael doesn't like any of them. I'm sure we're going to hear a bit about that. But Jennifer, who's here, very much the author of many of them, but you just go through them, whether it was the American Rescue Plan right at the start, which obviously was helping to stimulate, designed at least to stimulate the economy, as the economy was still coming out of COVID, but also contains some important measures and things like education. We had the Investment Infrastructure, the so-called Bipartisan Infrastructure Act, and that was, by the way, American Rescue Plan was $2 trillion, approximately. The Bipartisan Infrastructure Investment was $0.5 billion or so. These are 10-year numbers, of course, in the U.S. The famous IRA in inflation, some of us will have arguments with the naming of that legislation, but it was the Inflation Reduction Act, that's its official name. Major spending, of course, on green initiatives and on healthcare. And of course, we had the CHIPS Act, too, so all of these things have added up to trillions, trillions of dollars over 10 years. A real transformation in the U.S. economic policy after years and years in which the left Democrats trod cautiously. None of this sort of big government, big government initiatives. But that all seems to have been abandoned in the last few years. And of course, most interestingly, it's become very much the debate is whether it's a model for the rest of the world. It's become a model, in some extent, because there's been a reaction to it around the world, particularly here in Europe, concerns about some of the provisions, and we'll get into this talking about whether the extent to which this is a domestic focused, national champion quasi-protectionist approach. But also, I think many people have adopted what they seem to like about much of the Biden administration's approach and think that it's the right way to go, especially in terms of some of the green investment and some of the other things. So anyways, setting the ground there, we've got a terrific panel. I'll just quickly introduce them. You don't need much introduction, but I will quickly, briefly, on my immediate left, Rachel Reeves, Shadow Chancellor Dick Jekka, in the UK, and obviously that means chief economic policy spokesman for the, sort of spokesperson for the opposition, Labour Party. There's been a member of Parliament since 2010, I think that's right. And we, Rachel and I do have one thing in common, which is that we both started out our working careers at the Bank of England. She obviously has gone on to considerably greater things than I. And as we look at the opinion polls in the UK, which seem to suggest that the Labour Party is on course probably this year for a majority on the scale of Tony Blair's in 1997, those things are only going to get greater for Rachel. So Rachel, welcome. Thank you for being here. Blake Moretz is chief executive automation of Rockwell Automation based in Wisconsin, I think Blake. You've been with, you've been dealing with many of these issues and we want to hear from you on the kind of industrial sort of the view from industry on a lot of these measures. You've been with Rockwell, I think for almost 40 years, I think I was reading. It's remarkable. You're obviously doing you very, very well. On his left, Michael Strain. And if you will know, economist, director of economic policy at the American Enterprise Institute, a widely written, widely published author on economic policy on broad macroeconomic policy, but also on Labour and international economics. And I think we'll probably be the member of the panel here with the most, shall we say, shall we say heterodox views from kind of from the from the Davos consensus. And on the far left is Jennifer Harris, who is now director of economy and society at the economy and society initiative for the US at the William and Flora Hewlett Foundation, but who was, of course, senior director for international economics at both the National Security Council and the National Economic Council in the early years, the Biden administration. And so as I said, right at the start, at least one of the authors of this modern supply side economics. So we've, as I say, we've got a terrific panel. Let's get straight into it. I'm going to start with you, Jennifer, since you are the the the prime mover in all of this, the whole idea behind this and was set at the time. And again, we can talk about the individual, the individual measures, but the broad package was intended. The plan was to increase the supply side capability economy with these kind of with with this significant government intervention, but also with things like education and childcare and all the other things that they're associated with it. And of course, this major investment in green technologies. Obviously it's early days. But have you seen any evidence yet that you're achieving the kind of liftoff of the supply side economy that that that you and the president claimed for it at the start? Yes, I think, you know, there is an important debate that we should have well about what the evidence should be. I think we need to kind of be thoughtful about the the arena that we construct for ourselves, the ground on which might when I should fight this out. But, you know, I think the the probably most powerful test is just in the basics of inflation. I think there are two foundational sort of concerns or anxieties on the economic score, you know, keeping most of us up at night. Certainly for the last couple of years, that's been the acute inflation that several of us in the White House assessed to really be a product of the unwinding of the pandemic. But prior to that and preexisting but never really going away, still there below the surface, we had, you know, a set of concerns that a lot of us called secular stagnation that really added up to, you know, slack in the aggregate demand, a US economy that was performing well below its potential. And, you know, not a lot of clear theories about exactly how to get out of that whole. And it seemed like whether it was the longer burn secular stagnation or inflation, we kind of put together a formula that solved for both simultaneously, which was essentially to exactly, as you said, push the productive capacity of the economy to the right and do so through a set of upstream backbone infrastructure investments and physical infrastructure, the BIL, the technological backbone of country and chips and science and the energy backbone. And so it's your question of how's it going? Certainly we saw inflation come down faster with less pain in the US. It's something of a controlled experiment. But you're not going to ascribe that to the Inflation Reduction Act? Not to the Inflation Reduction Act per se, but I do think that there is important, you know, green shoots in the data that looks exactly like you would want it to if you wanted the story to play out, right? So you see the kind of hockey stick graph in investment in construction spending. You see important shifts in the company, both job gains, really strong labor market that's persisted as interest rates have gone up, and importantly, shifts in the composition of jobs to much higher productivity, higher value added, higher technology jobs, better jobs, and it's adding to the overall productivity gains that we've also seen. And so there's a whole lot to like in this formula, at least as a recipe for solving what ails right now. Not for nothing. You have these co-benefits. It seems like it's a finally a politically sound approach to moving the ball on climate. And hopefully we'll see, but kind of through doing all of these investments and, you know, places really disaggregated across the country, you know, that get in away from the coasts, you see people believing that their government can deliver for them again and a reinvestment in kind of small democracy. Before I come to the others, do you accept the criticism of some in your own party that the American Rescue Plan in particular with the huge stimulus it represented, particularly in the form of the checks that went out to all Americans earning under a certain income level. That huge stimulus and people like Larry Summers did say that he and others too thought that believe that was extremely inflationary and contributed the inflation. So, you know, which then let obviously the Federal Reserve had to raise interest rates, you claim the inflation reduction act, isn't it a bit like, you know, the arsonist setting fire to the house and then calling out the fire brigade to put out the fire? No, I think that we have had this this debate about the root causes of inflation and it seems like they have, you know, we see inflation come down as a lot of the supply chain kinks have unwound. I think there's a lot of evidence to suggest this was firmly a set of supply chain related causes that are gone. I mean, it was a quick bout and we're done with it. And, you know, as a policymaker who's having to make policy in the fog of uncertainty, you're forced to basically pick a default setting, right? Which way do you want to air? I would be, you know, knowing what we know now that we do have the ability to, I think, use a certain kind of fiscal investments that I think are disinflationary over the medium term combined with the monetary policy tools that we have. It should give us comfort that in these moments of crisis we are allowed to air on the side of kind of putting a floor under the economy and so I would hope that that's the lesson that any policymaker takes from the last couple of years. Thanks, Jennifer. Rachel Reeves, if I come to you, as I said at the beginning, a lot of interest in this from the international perspective, both its ramifications politically and the way in which it might be a model for other governments, is by-nomics the blueprint for the next Labour government? Well, first of all, just to where you started, you know, the traditional view of supply side is that its policies from the right and the traditional view of the centre left is the sort of Keynesian pump priming and we're now very much owning the space of expanding the supply side capacity of the economy. Look, we have different constraints to the US, particularly around fiscal headroom, which means that we would have to do things differently if we have the privilege of forming the next government. But on investment in low carbon energy for the reasons that Jennifer set out that it is the cheapest form of energy in the longer term will be de-inflationary. In addition, the need to build a more secure and resilient economy in the face of the shocks that we're facing, I call it secure and omics, but it is very similar to the modern supply side approach that Janet Yellen and others have set out. But in the UK, it can't just be about spending money to improve the supply side capacity. We just don't have that luxury in the UK. So for us, it is particularly around planning reforms to unlock private sector investment to improve our infrastructure in the UK. That is a big barrier to business investments in the UK right now. We are, I think, the only G7 economy that has a lower participation rate in the labour market compared with before the pandemic. We have got to get people back to work by dealing with the huge backlog in our national health service and the high levels of sickness through both physical and mental health. That would be another supply side policy that would make a big difference to expanding the supply side capacity of our economy and also reforms to our pension system to unlock some of the long-term patient capital. So I think our aims are similar and our diagnosis is similar of the need to build a more secure and resilient economy and address some of the supply side constraints that have led to the secular stagnation that Jennifer has described, but the policy perspectives in the UK will be different. I have set out a green prosperity plan, particularly a national wealth fund, to invest alongside business in some of the opportunities to move us to a low carbon economy, but for me it will be primarily the non-fiscal levers to grow our economy and expand that supply side capacity, but very much a focus on the supply side rather than a more traditional centre-left demand side approach. The election will be in the next year. Will you given that, given the fiscal constraints, are you planning to put numbers to the plans that you have ahead of the election so that people can vote on knowing what they are going to be spending? Yes, of course, and I have been very clear that there will be nothing in Labour's manifesto that is not fully costed and fully funded. I have already set out a set of fiscal rules that we will pay for day-to-day spending. Is that plan to be fiscally neutral? What is the, if I am sorry. The fiscal rules that we would pay for day-to-day spending through tax receipts, we would get down as a share of GDP, debt has increased in 13 of the last 14 years under Conservative government, and then subject to that we would invest in the things to boost our long-term potential as an economy. We have already set out some fiscally neutral changes, for example, to get rid of the non-dom tax status and replace it with a scheme for people who are genuinely in the UK for a short period of time, changes on rules around how private schools are taxed, and that money will go into front-line public services. But as I say, there is not going to be a lot of fiscal headroom and all of our policies, including the commitments to get to a zero carbon economy, will be subject to that tough set of fiscal rules. And before the next election, there will be at least one more budget on the 6th of March. If the election is dragged all the way into the autumn, as Rishi Sunak, our Prime Minister, has suggested, then there is likely to be another fiscal event in the autumn of next year ahead of the election. So we will make the final decisions on the numbers based on the inheritance that we will have. It's not the inheritance that perhaps I might have wanted, but it's the inheritance that I will get if I become Chancellor in the next year. Blake, Blake Marek, give us your perspective on, from the private sector of the, especially you're at the cutting edge of many of your clients, I think are directly involved in many of the initiatives that are in the various pieces of legislation. Give us your sense of how well it's working and what your expectations are since again we're in the relatively early stages of this. Sure. Well, we benefited in general from investments in America. And that's gone on for a while, I would say, you know, going back to really 2016 Rockwell as a supplier of automation, hardware and software to American manufacturers and production companies were probably the most pervasive technology in those plants. We've seen large increases in revenue, in profit and in our employee workforce. And I think the investments that are being made with the stimulus are, we should look first at those as investments in technologies and infrastructure that's absolutely important for America to succeed and to successfully compete in the years to come. But it's not going to be one and done. We're in the early innings of the money actually having impact. And for many of these things, such as chips and science, it's not just building the fabs, it's the whole infrastructure around the semiconductor wafers that's going to be required for many years for us to truly make that supply of that critical technology more resilient. Michael, come to you. You like the old supply side economics that Rachel described. But obviously you'll want to say what you want to say about bi-economics and what we've seen here. But it's not exactly as though that supply side approach that you favored, and we can talk a bit about the Trump tax cuts. It's not as though that exactly dramatically expanded the capacity of the U.S. economy either, did it? I mean, U.S. productivity performance has been pretty weak for quite a long time. We've talked about secular stagnations, the problems that the U.S. has had. So why shouldn't we give this a try? The U.S. certainly could be doing better. I don't think it makes sense to characterize subsidizing economic demand and to characterize the government picking winners and losers as some sort of supply side reform. I do think some of the things President Biden has done do count as supply side reforms. Broadband access, for example, will definitely help create a more educated workforce. That expands the supply side of the economy. Childcare, properly done, helps people to work, increases the supply of labor. But that does not, I think, generally characterize the administration's approach to economic policy. And this is a bipartisan problem in the United States. It does not characterize President Trump's approach to economic policy. My big objection to this new bipartisan approach is that it does not work. When President Trump launched his protectionist trade war, it was sold as a case of concentrated benefits and diffuse costs. Everybody's going to pay a little bit more for cans of soup as a consequence of these tariffs. We're going to have this revitalized manufacturing sector. What actually happened? Manufacturing employment went down, not up, because inputs to production for domestic manufacturers went up and because other countries retaliated. What's going on with President Biden's approach to this? We're seeing an increase in construction spending. We are seeing no increase in manufacturing employment. Manufacturing employment was flat over the last 12 months. You are absolutely right about the need for an ecosystem around semiconductors. Simply passing a law that gives money to build fabs in swing states in the 2024 presidential election does not create a workforce that is capable of working at those fabs. And what we're seeing is that some of those fabs are producing chips that are already obsolete. I want to give Jennifer a chance to respond, because I'm sure she's shaking her head there. You disagree that manufacturing jobs are not being created? I think you should cite your story. The Bureau of Labor Statistics. Well, there was an unfortunate economist piece that came out with that claim and actually some economists close to this administration but really well respected from Employee America went toe to toe with the underlying data. And I think there there is a retraction and a correction in the works I am told. But that I think exactly reinforces my point about we are breaking the mold, we are doing new things here and we need better metrics upon which to kind of have this debate so that we're not sort of susceptible to the kind of cherry picking and the cylindra like politicization of cases that are not really representative. Blake, you're very much on the ground as it were. What's your perspective? What are you seeing? Are you seeing a revival of U.S. manufacturing? And is it ascribable to all these measures? Well, about 12.9 million manufacturing jobs. The data that we've seen indicates that about 800,000 jobs, not necessarily new jobs in manufacturing, about three quarters of that 800,000 figure were added back to recover losses from the pandemic. From the pandemic, a couple of hundred thousand of new manufacturing jobs very similar to the jobs added in 2018 that when the Tax Cuts and Jobs Act were passed. So I think both of those, both of these sets of measures have actually had a positive benefit on U.S. manufacturing. But it's going to take many years. It's not going to be a one and done thing for either of these. I know, you know, going back to tax cuts and jobs, we repatriated money and increased our investment. A large part of that was in the U.S. And we're already seeing its early innings, but we're seeing the benefit of stimulus, solar panel manufacturing and providing the automation for that, electric vehicles and batteries. So we're seeing that, but by no means are we at a point where we can declare victory or total success. Jerry, if I can just quickly. Please get going, Michael. No offense to your excellent company. I haven't mentioned this to you. I was an intern at Rockwell Automation several decades ago. The four-sided clock and all that. Well, I don't know. I didn't stick around that long. It was a summer internship. I would question the goal of revitalizing manufacturing. It seems to be implicit in both the Republican and Democratic Party right now. It seems to be implicit in President Trump's protectionism and implicit in President Biden's approach to economic policy that revitalizing manufacturing should be the objective or an objective of economic policy. I just flatly reject that. You're quite happy to say it. But I mean, in an age of, you know, where we've seen these supply chain constraints, where we see growing geopolitical tensions, the relations with China, U.S. and China, obviously deteriorating this whole, you know, what seems to be going on. This does seem to be bipartisan. Is this desire for nearshoring, reshoring all of that? Doesn't that alone argue for a revitalized U.S. These are all real threats. It is perfectly reasonable to argue that the United States should not rely on semiconductors produced near China with whom we have an increasingly adversarial relationship. That it is a huge leap to argue that they should be produced in swing states in the 2024 presidential election. They could be produced in Southeast Asia. They could be produced in Mexico. They could be produced in a variety of places. And the private sector doesn't need the White House to tell it how to manage supply chains. I want to come on to that. But kind of Jennifer Gant is, I can see, I think it's actually really important to defend the economic importance of manufacturing, not as a kind of national security imperative, but really on the straight up economic fundamentals. It's really important to have a de minimis manufacturing base, not so much for what you are producing today, but for the ability to innovate tomorrow. EV batteries. The U.S. kind of invented sodium ion technology. We went to the different direction with lithium. Right now, China is outfitting all of its EV manufacturing, not all, but a lot of its EV manufacturing, battery manufacturing base to run on sodium because of advances that have happened in sodium. We have to now build an EV manufacturing, battery manufacturing base. And before we get to the question of figuring out sodium and reverse engineering, that wouldn't be the case if we had some de minimis manufacturing base. So it really is about the innovation clusters and the distributed geographies that manufacturing base allows for an economy. I want to move on. I know you'll want to respond, Michael, but I want to move on. Rachel, I particularly want to come to you. And, you know, this is all dressed up as modern. You, as you well described, did it kind of in, you know, swapping clothes between the Keynesians and the kind of supply ciders with this now being, you know, supply side now being the kind of the progressive view. Some of us are old enough to remember industrial policy. And it does sound quite a lot like industrial policy. What Michael calls government picking winners. I actually, I'm old enough to just about to remember the Labour government of the 1960s and 1970s. It didn't end well, did it? Government, you know, directing investment into particular areas. And in fact, the whole revival of the sort of the Western, if you like, what people now call the neoliberal consensus, but the whole revival of Western, of the Western economy that took place with the liberalisation and government getting out of that occurred precisely because of that. This just sounds a bit like you want to take us back to the glory days of Tony Ben. So I think it's a myth that there's not an industrial strategy today. There is always an industrial strategy, whether it's written down or not. And the industrial strategy today of the government is a, you know, they say fair, leave it to themselves strategy. We're not in the business of picking winners and picking firms to back, but there are sectors of the economy where Britain does have huge strengths, life sciences, creative industries, professional services and in some of the clean energy industries of the future, particularly carbon capture, green hydrogen and floating offshore wind because of our industrial heritage and our climate and other strengths that we have. And in a transition, which is what we will be going through in energy, there is a role for governments, partner with businesses, but also with universities to make the most of the resources and the potential that we've got. And there is a global race on for these jobs and this investment. And if the industrial strategy is get out of the way and just leave it to the market, then I can tell you the jobs and the investment won't be coming to Britain. They will be going elsewhere to countries that have got a more active industrial strategy. So we are proud that we are going into the election with an offer of an industrial strategy and an industrial strategy council on a statutory footing, actually borrowing from some of the better ideas that the Conservatives had had over the last 14 years when Greg Clark was the Secretary of State for Business. He did pull together an industrial strategy and Andy Haldane, the former chief economist at the Bank of England was chairing that industrial strategy council. That was ditched. I think there's been something like 11 growth plans in the 14 years of this Conservative government. We want to have one that lasts to give businesses. And I think this is a key part of the approach of an incoming Labour government, pro-business, pro-wealth creation and working with business to identify the things that are currently blocking investment. And as I say, this is certainly not about just throwing money at a problem. This is about reforming our planning system so that private sector investment is at the moment 200 billion pounds worth of projects stuck in the pipeline trying to get a connection to our national grid system. We want to unlock that private sector investment in the economy and through the creation of a national wealth fund, leveraging private sector investment in some of those new exciting technologies from carbon capture to small modular reactors to green hydrogen and floating offshore wind where Britain has huge potential but we'll miss out on it unless government has a more active role. So it's not sort of national enterprise board revisited or... No, absolutely not. This is a modern approach. It is a different approach. But I think it is also distinct from the approach that you see in the US in part because of the resources and the constraints that a Labour government would inherit. Actually getting people back to work would probably be the quickest thing you could do to boost the supply side capacity of the UK. But when you've got a NHS waiting list of 7.8 million, you can see that there are a lot of people who are not available for work today. So our modern supply side approach is beyond an industrial strategy. It's looking at the other things that are holding us back and constraining the supply side of our economy. Blake, I think you think that actually there are benefits from both the old supply side economics and the modern supply side economics. We were just talking a little bit earlier about, you know, obviously Donald... We had the big Donald Trump tax cuts, which cut particularly corporate taxes by a significant amount. And, you know, there are some ongoing... I'll give you some economists about whether they were effective in terms of improving increasing investment or... But you viewed that quite positively and you think that has helped as well to energize the US economy, don't you? I do. And I think further to that, I do think there's a very strong case for having as an explicit goal the increase of manufacturing in the US. Now, it's not all manufacturing. It's manufacturing that we can compete and win in, which means that it's a combination of the technology and the labor. Even if those labor rates are high compared to the average in the world, we've proven and our customers have proven that the combination together, you can compete. So I think the inference that we should, you know, give up manufacturing as a part of the economy would be a disaster. Not only the jobs directly employed in manufacturing, but the multiplier effect, the capital formation that's affected. Other services that are affected is absolutely essential and we see that companies, even with the higher wage rates in the US, can compete and win in manufacturing areas where both are important. Let's... I want to come to questions. We've not got too much time left, but I want to look at the international implications of this. Obviously, we're here in Davos and we're looking at the global economic implications of this. And again, I want you all to get all your views on this. Jennifer, I'll start with you. Obviously, the big concern, whatever one's views are, otherwise are the merits either of boosting manufacturing, Michael doesn't like that, but sort of doing it in this way and a lot of people on the right in the United States and around the world don't like that. But whatever the specific merits, there's a lot of concern that this represented yet another kind of blow in the direction of de-globalization, that it was about, you know, America, favoring, privileging American companies. It sent, I remember, being here in Davos two years ago, I think, well, just not long after the pass, when Joe Manchin was here and was getting his ear bent by European officials telling him, you know, this is basically... This is protectionism. This is thinly disguised protectionism. And it's going to lead to increased focus around the world. Subsidies increase, all contrary to the principles of free trade and everything else. How do you respond to that? And again, I know there were some concessions were made, but the Made in America provisions, the America First, a broad approach to this, with the CHIPS Act, with the IRA, it does look like this is a... a domestically focused, sort of raised middle finger to the rest of the world. No surprise, I would take another view. Maybe two or three points. One, the... I think probably the largest dividend internationally from at least the IRA, which is what I know best, is just the technological spillover and the way that this R&D and learning will push cost curves down across the board, especially for some of the more, you know, nation technologies in areas like hydrogen and carbon management. But the best estimates I've seen are from Rodium suggesting that across the board, you're looking at a 10 to 15% reduction in the cost of clean energy technologies, which looks a lot like the role that Germany played for solar in the 90s. Thing one. Thing two, you know, this is adding to aggregate demand at a time when China is slowing, when the world needs sources of aggregate demand. I think it is fair and, you know, right to expect the U.S. taxpayer, if they're footing that bill, to be first in line for these investments, especially when Joe Manchin has made quite clear that it was essential to getting them over the line. And then I think the response from the U.S., and I'm thinking mostly of the speech that I worked with Jake Sullivan on is kind of my parting gesture at the door and the administration this past spring. The posture of the U.S. has been, do it too. Not in a glib way. We want you to do it. We need you to do it. In fact, we can't reach the domestic goals that we have set out for ourselves without the U.S.'s partners, you know, doing something of the sort, whether it's secureonomics in the U.K., and, you know, there will be local context and flavor. But by and large, you know, kind of leave it to the market, you know, approach of this energy transition. We've tried that for 40 years and it's gotten us nowhere. We don't have time to kind of, you know, run that experiment again. And so, you know, we need to take a more hands-on approach. It's going to look different everywhere. But I think what the U.S. has said, and now we need to help it follow through, is that, you know, at least with the Biden administration, they will overhaul a lot of the U.S. foreign policy into making the U.S. a more affirmative partner in helping other countries do it, too. There's $3 trillion that we need to see, you know, materialize, get in the game in the clean energy transition. We've just passed the $1 trillion mark. That is more than enough opportunity there for everybody. Michael? I mean, there is going to be a bipartisan consensus. Whatever, again, one thinks of the specific measures, a kind of a bipartisan consensus, at least as far as the Trump side of the Republican Party is concerned towards America first. Do you think this fits into that kind of broad, could be described as sort of protectionist approach? Yeah, I think it's very hard to distinguish between the two to the point that President Biden, despite many expectations, kept in place the Trump tariffs, despite the fact that taking the Trump tariffs down would have reduced inflation, which the President said was his number one goal. Just to be clear, I don't think the U.S. should not have a manufacturing sector. I think the manufacturing sector in the U.S. is vital and important, and I think exactly for the reasons that you say it is, and there's a reason why manufacturing employees in the United States earn so much more than abroad. My objection is to dumping hundreds of billions of taxpayer dollars onto that sector rather than just treating that sector neutrally along with all other sectors in the economy. I think there's no question but that the Inflation Reduction Act has been a major geopolitical problem. If I recall correctly, President Macron said that it threatened to fragment the West. And what you get is a subsidy war where we subsidize, they subsidize, we do some carve-outs here and there, they do some carve-outs here and there, and when subsidies are countered with other subsidies, they're not effective. And so all we're doing is lighting taxpayer money on fire. If you want to have advances in innovation in clean tech, do a carbon tax. It'll raise revenue, which is what we need. It is neutral as to which technologies it supports. You don't have the White House and the United States Senate deciding who gets IRA subsidies. You have markets deciding. That will produce better outcomes. There's a state capacity issue here. The United States government is having a hard time getting the money out the door. Childcare centers have to be built within 50 miles of fabs. All these competing goals, even if the law were perfectly designed, which of course it isn't, there are real questions as to whether or not the government can actually make this sort of thing work. Blake, your perspective from a major U.S. company with major international operations, is this, how do you see it? Is this going to focus more of your attention and resources on the U.S.? Well, it already has. As the share leader and the amount of demand that's being placed on us, we're definitely seeing increased emphasis because of the actual activity and also because obviously our European competitors see it as an opportunity as well. And so they're certainly competing for this and we expect to win more than our fair share, quite frankly, and so we're making additional investment. I think that it's a starting point. These are multi-year propositions, particularly semiconductor, the transition in the automotive industry as we look at bringing up renewable forms of energy and the grid to be able to do that. We're gonna have to have heart and it's gonna have to survive multiple administrations for this to have the kind of long-term impact that was originally intended. Rachel, this is a consideration for you. As the Labour government, you're gonna be having important conversations with partners obviously in the EU, but around the world about looking for a closer trading opportunity. Is this gonna be something that's going to help that or be an impediment to that? What do you stand on this? Well, I strongly agree with what Jennifer said at the beginning and I sort of, Michael's position is sort of, if we just sort of carried on like we were, everything would be fine, but everything wasn't fine. Economies weren't really growing and inequalities were widening and we were losing more jobs and exposing vulnerabilities by relying too much on countries that don't share our values. So we have to do something differently. I'm not suggesting, I don't think Jennifer is either that everything has been done correctly and with the benefit of hindsight, maybe you do some things differently, but I think we have got to try something different and I think the last few years have shown us that these sorts of once in a generation or once in a hundred year pandemic war, et cetera, these things are coming at us thick and fast and they are exposing vulnerabilities in both our economies and many other developed economies alike that the model of the fastest and the cheapest and the quickest and it doesn't matter who owns things and where they're made, I think those days are gone because those things do matter and the vulnerabilities in our economies have been exposed by a model that I think has passed its sell-by date. Now, that certainly doesn't mean trying to do everything yourself and for a small open economy like the UK, it can't possibly mean trying to do everything for ourselves but it does mean trying to build a bit more resilience into our economy. So when shocks come along, Britain is not as exposed as it has been. You know, our inflation rose the fastest. Our economy has struggled the most to bounce back and a lot of that has been because of a lack of resilience and too much exposure to these global events and we have got to build the supply side capacity, get more people into work, more good jobs in parts of the country that haven't benefited in the last 40 years and that means trying something different. You might not always get everything right but if we carry on like this, we're going to find British growth stuck in the slow lane whilst other countries seize the opportunities and a whole range of industries but I would just go back to the point that in the UK, the approach will be different from the US but the same philosophy that boosting supply side capacity is the way to achieve strong and sustainable growth in the future. Thank you, we've got just a couple of minutes for a couple of questions from the floor. Please, yes, ma'am. No, there's a mike coming. Mehreen Khan from the Times of London. Is it on? Is it on? Yeah, yeah, I'll still shout. Can you hear or you can hear? Sorry. Mehreen Khan from the Times of London. One issue that hasn't been mentioned is how to expand the supply of labour and I know that Rachel, you mentioned it a little bit when talking about labour force participation but migration is an obvious way that rich countries have expanded the supply of their labour. It hasn't been mentioned and I'm wondering from Jen and maybe from you Rachel whether there's a tacit feeling that Western democracies can't actually handle increases in migration and when we think about supply side economics we're just going to ignore this because it's too politically or culturally sensitive for us to really tackle head-on from an economic perspective. Rachel, do you want to take that? Yes, thanks very much, Mehreen. I think that we have got to help support people who are already in the UK economy take on the jobs that are available. There are many vacancies unfilled, there are huge skills gaps in a whole range of areas and we can't just turn to the short-term fix of importing more labour. We've got many people out of work because of long-term sickness. I think the additional cost in terms of higher benefit payments and lower tax revenues is something in the tune of £15 billion since the pandemic because of fewer people, more people claiming those sickness benefits. So we've got to help people back into the labour market and ensure that people are being trained up with the skills that are needed. You've got this disconnect in the UK today where you've got the Migration Advisory Council who recommend on the need to bring in migrant labour but that doesn't feed back into our skills and further education policy of what young people and others need to be learning to fix those skill gaps. So if we have a lack of people available to work in as data scientists or in social care, what are we actually doing to train people up who were already in the UK? And that would be my response, both helping people get back into work and ensuring they've got the skills. Subject to that, of course, where we've got skills gaps, we do need to use migration and I think migration has been a huge benefit to the UK over a long period of time, not least attracting high-skill people to our fantastic universities and then encouraging them to contribute in our labour market, but immigration cannot be the answer to all our skills problems. We've got to do more to help people who are already here skill up and get the jobs that are available in the economy. I don't know if anyone else wants to comment on this. Yeah, Blake, yeah. I think in the US to frame the problem, we have several hundred thousand unfilled in manufacturing jobs today expected to grow over the coming years to a couple of million of those immigration reform as a part of it. Reskilling and upskilling employees throughout their career in quick-hit programs to be able to give them the skills to be able to thrive in the jobs interacting with technology is an absolutely fundamental part of this as well. And I will say it, some of the new technologies, including AI, hold the promise to simplify tasks and so that people through their career can actually look and compete successfully for new jobs in these manufacturing areas. We might have time for one more, any quick question? We may just about running out of time. No, in that case. I can answer the last one. Yeah, Michael, why don't you, and I'll give Jennifer a chance to say. In addition to immigration, which I think is vitally important and I agree with everything you said, including about AI, we have a great program in the United States called the Earned Income Tax Credit, which is an earning subsidy. If you work and you earn $10,000 a year and you have a couple of kids, then the government will give you $4,000 on top of that. That has been demonstrated to increase workforce participation. It's a redistributionist policy, but I think it is a true supply side policy because it increases the supply of labor. It has had broad bipartisan consensus in the United States, but the consensus for it under President Trump seemed to kind of evaporate and President Biden hasn't chosen to champion it. Jennifer, last word, either on this immigration question or since you're the last, you've got the opportunities to wrap it all up on modern supply side economics. Not to leave us with the downer, but I'll just leave you with kind of what's keeping me up at night. I do agree that there's a lot to the how and this is new and there's a lot of humility and learning and some of the most dedicated, hardest working people I know are figuring out and sweating the details every day. It's actually interest rates for the investments that we're talking about, especially within the IRA, although I think it's somewhat fair of chips and science as well. These are incredibly capital intensive and again, I think disinflationary over the medium and longer term and to have rates now that inflation I think is firmly settled, lingering at five and a half percent. I just don't see any justification and it's a really dangerous headwind. I think when you're looking at the difference between a new clean energy investment and a high interest rate environment versus a gas plant that it's gonna increase gas plant a cost something like 8% and that's gonna increase the clean energy investment something like 50%. So every day matters and I think that we need to see the Fed cut 300 basis points before they start asking questions and not for nothing, but I think there are important political and other consequences that go along with the Fed sort of doing its job of respecting its goal mandate. All right, it's cocktail hour I think and I can hear the sound of bottles being opened all over Davos. So we should let you go at this point but I just wanna say it's been a fascinating discussion. Certainly learned a lot about new supply side economics new and old and all of its opportunities and risks and everything else that it represents and it's been a wonderful panel. Please join me in thanking our panel for this conversation. Thank you.