How we learned to love state capitalism
A generation ago conventional wisdom held that as China liberalized, its economy would come to resemble America’s.
Instead, capitalism in America is starting to look like China.
This isn’t socialism, in which the state owns the means of production. It is more like state capitalism, a hybrid between socialism and capitalism in which the state guides the decisions of nominally private enterprises.
China calls its hybrid “socialism with Chinese characteristics.”
The U.S. hasn’t gone as far as China or even milder practitioners of state capitalism such as Russia, Brazil and, at times, France.
So call this variant “state capitalism with American characteristics.”
It is still a sea change from the free market ethos the U.S. once embodied.
We wouldn’t be dabbling with state capitalism if not for the public’s and both parties’ belief that free-market capitalism wasn’t working.
That system encouraged profit-maximizing CEOs to move production abroad.
The result was a shrunken manufacturing workforce, dependence on China for vital products such as critical minerals, and underinvestment in the industries of the future such as clean energy and semiconductors.
Greg Ip Wall Street Journal 11 August 2025
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