Bold eagle: America's industrial evolution

Hello and welcome to The Intelligence from The Economist. Today from London, I'm your host, Jason Palmer. Every weekday, we provide a fresh perspective on the events shaping your world. It's long been difficult for independent media in Russia. Since the invasion of Ukraine, it's become just about impossible. So what are journalists doing? Moving outside the country and working to get the truth into it. And Gina Lollobrigida was often called the most beautiful woman in the world. She even starred in a movie by that name. But we look back on a life that was more than flimsy, foxy film star. An irrepressible, impenitent Italian who lived just as she wished. But first, America is undergoing major renovations.

In order to meet the challenge of today, we can't just build back the way things were before. We have to build back better.

During his election campaign, President Joe Biden promised that his administration would plow plenty into America's economy.

We'll make the biggest investment in manufacturing and innovation since World War II.

Over the past 2 years, he's been making good on those promises with big and complicated legislation.

I'm about to sign the Inflation Reduction Act into law, one of the most significant laws in our history.

As politically fraught as those bills have been, money is at last filtering into the economy and just starting to reshape it.

The Biden administration is essentially trying to use big policies to spur a frenzy of activity within America's borders.

Charlotte Howard is an executive editor at The Economist and a co-host of Checks and Balances, our sister show on American politics.

So it wants America to produce more clean energy, it wants more innovation, it wants more manufacturing, all as a way to deal with these really giant challenges: climate change, dependence on China. It wants to revitalize America's economy. So it's an astonishingly ambitious agenda.

So if this is a vast rethinking of America's industrial policy, let's wind back and talk about what it's like now.

Well, really, for the past 40 or so years, since the late 1970s, the predominant theory has been that free trade deals, low taxes, and relatively little regulation is the best way to spur growth. And the Biden administration would point to different examples of state investment over the course of the 20th century. So for instance, investment in innovation through the Defense Department or the construction of the interstate highway system Reaching even further back, you might look to land grant colleges. And these were investments made by the government that supported long-term growth. And so what's happening now is that you see a few really big bills, the infrastructure bill, the CHIPS bill, the Inflation Reduction Act, which is largely a climate law, and they're trying to advance industrial policy and make progress towards these big goals through state intervention. And the nature of the support is of a different scale and difference in structure than what we saw before.

Different how, though?

What you see now are two different things which are both really important. One is a big attempt to try to make America less dependent on Chinese supply chains, in particular for critical goods—so clean energy equipment, solar panels for instance, as well as semiconductors. And semiconductors, you know, are predominantly concentrated within Taiwan, but nevertheless America sees that concentration as a real risk to its economic and national security, in part because of the risk of a Chinese invasion. And so you have an enormous amount of subsidies that are applied to those two industries, clean energy and semiconductors. And then they're also trying to move supply chains back within America's borders. So you have $39 billion in manufacturing subsidies for semiconductor factories. And then interestingly, you also have a lot of subsidies to try to move the production of clean energy equipment beyond China and back to America, or at least to countries with whom America has close trade agreements like Canada and Mexico.

So insofar as this vast change is, is already underway, what does it look like on the ground?

Well, it's interesting to see the investments that have been made even in the past 2 years. So carmakers have announced nearly $70 billion of investments in 2021 and 2022. That's the industry's biggest building boom in decades. And for carmakers in particular, you see this kind of corridor of investment that stretches along Interstate 75, which goes from Michigan down through the the industrial heartland down to Georgia. You have companies like Ford that have announced big investments not just in Michigan, but in Kentucky and Tennessee. You have Hyundai in Georgia. You have BMW in South Carolina. Janet Yellen likes to call it the battery belt, but it's investments in battery plants and in EVs in the middle of the country.

So that's the car industry. What about the other things you mentioned, computer chips and clean energy technology?

For chipmakers, you have these giant semiconductor fabs that are coming up in different parts of the country. TSMC, a Taiwanese firm, is building a new factory in Arizona. Intel has one in Ohio. Micron has one in New York. And then I'd also point to big announcements of hydrogen investments. So in North Texas, for instance, in December, there was a $4 billion announcement from two companies that was hailed by the governor there, Greg Abbott. And a lot of these investments are catalyzed by, and in many instances, dependent on subsidies that have been advanced by the Biden administration.

And so what about for the, the American worker? What is all of this going to mean for America's workforce?

So the effect on the American workforce is the big open question here, because to staff these factories, you need a lot of highly skilled workers, and it's not clear that America has them. Now, you can invest in training to try to staff up America's labor force, and companies are working with state governments to try to do this, but it's not clear that that will be on the scale required. You could also have immigration policies that let America admit more highly skilled foreign workers, but there's no political support to do that. And then the third problem is there's this huge pool of working-age Americans, particularly men, who are not in the labor force. It's risen dramatically since the 1950s. So about a third of working-age men are neither employed nor looking for work. So the big question is whether America's long-term labor problem will be the stumbling block that prevents the Biden administration from achieving its goals.

So what's your view here with some positive results already showing from this? Is this plan to remake America the right one? Will it work?

If I were to sit at my desk and think of what policies America might come up with to achieve its stated goals, they wouldn't necessarily look like the ones the Biden administration has presented. So for instance, a carbon tax plus clean energy subsidies would help move the energy system more quickly towards net zero. To reduce dependence on China, one could think about a real proliferation of trade deals with American allies rather than a surge in domestic subsidies to try to move investment within America itself. The truth is that neither free trade nor carbon tax were remotely on the table politically. If you look at the most protectionist elements of the Inflation Reduction Act, The reason they are there is because Joe Manchin insisted that they be. Joe Manchin being a West Virginian senator whose vote was crucial to the Inflation Reduction Act's passage. So what we have here is the best politically possible set of policies to try to deal with these really big challenges.

So if it's politics that's shaped this package of measures, is that good or bad? Will that help or hinder how to maximize their chance of actually getting put into place?

So if you think about the law's implementation over the next decade, there are ways that its goals could be advanced by loosening some of the strictest domestic content requirements, for example. But as we see the law unfolding, it is worth keeping in mind that there wasn't really any other option, particularly on climate, which is the existential challenge of our time. We had had a series of attempts to pass climate bills over the past 20 years that went absolutely nowhere. And what we have now through subsidies is a serious attempt to try to dramatically lower America's emissions. So I think that America is embarking on a big experiment that has big risks, but it does have the potential to advance goals that I think are important, not just to America, but for the world more broadly.

And I know that you've been thinking a lot about those risks and, and the opportunities of, of remaking America's economy. Yes.

So we have a bunch of coverage in this week's paper. We have a leader that helps to outline the scale of what the Biden administration is doing. I have a briefing that looks at how the effort to boost American manufacturing is playing out in practice. Our colleague Aaron Braun has a fantastic piece about the challenges of permitting as America tries to build more clean energy infrastructure. And this is the beginning of a series that we're going to have in the US section that really looks at this in depth, talking about the effects of America's workforce, the effect within particular states, how the push to accelerate innovation is going. So I hope that you all enjoy what we have to come.

Charlotte, thanks very much for joining us.

Thank you.

President Vladimir Putin has left little room for dissent in Russia. For years, the Kremlin has choked the media and cracked down on protests. Thousands of political activists have been jailed. Since the invasion of Ukraine, that repression has only gotten worse. Last week, the Kremlin declared Meduza, the country's largest independent media outlet, an undesirable organization. That means the company is banned from operating in the country, and even those who post links to its articles can be put in prison. But independent reporters, including those at Meduza, have found a way to supply news and opinion safely that challenges state propaganda by doing it all over the world. This is the rise of what's become known as offshore journalism.

For the Kremlin, suppressing news is as important as the war itself.

Arkady Ostrovsky is our Russia editor.

When the war started, the Kremlin very swiftly passed the law which basically criminalized genuine, honest reporting of fact. They threatened 15 years in jail for what they call discrediting Russian armed forces or spreading fake news, by which they meant actually calling the war a war. At least 500 journalists left Russia. They set themselves up in neighboring countries, in Latvia, in the Baltic States, in Georgia, in Armenia, and they started writing, broadcasting, trying to stay part of Russian information space and deliver the news. And they have reconstituted themselves. They've come back only more resilient, only more determined to deliver news, opinion, investigations to their audiences.

And now that they've set up camp elsewhere, what kinds of stories are they covering?

Well, they're covering a very broad range of stories. They're basically reporting this horrific war in Ukraine and its effects on Ukraine, the world, and Russia as if there had been no censorship in Russia itself. So they're really delivering a full range of genuine reporting. Meduza, for example, Russia's largest online media, which actually had set up offshore, had set up in Latvia in 2014, has been reporting from Butcher, the town near Kyiv where some of the first and the most horrific war crimes took place. MediaZona, which is an interesting site, it was set up by members of Pussy Riot, a punk band, has dedicated itself to abuses, torture by the Russian justice, or maybe we should say injustice system. They've been investigating the Wagner Group, the private mercenaries. They've calculated how many Russians have been mobilised on the 21st of September. They came up with a figure of 500,000 men, which is much higher than what the Ministry of Defence said in an official statement.

So two questions then about the flow of information given the situation. How are viewers in Russia even getting to this stuff?

There are basically three ways in which they can access it. One is VPNs, the virtual private networks, the apps you install on your phone, something that China knows well, Iran knows well. Now Russia used to be number 40 on the list of VPN users. It is now number 1. This is mostly the young and the educated, but they really do matter. The other channel is YouTube. Now interestingly, YouTube stayed open.

You don't need a VPN to access it.

TV Rain, Echo, both radio and now video, is broadcasting via YouTube. And so is, interestingly, Alexei Navalny's team. Alexei Navalny is the opposition leader. He is in jail. His team is in the Baltic states. They're putting out their show called Popular Politics, which is genuinely popular with the public. It's attracting millions of viewers. They can do it via YouTube. Now, the problem they have is an interesting one, is that YouTube, Google, and some of other social networks, including Instagram, actually turned off advertising in Russia when the war started as a boycott, as a sort of their way to protest. And while this was understandable kind of first instinct, in fact, it is hurting Russian media and it is hurting the opposition because What this means is that if two-thirds of your audience is in Russia, which is the case with TV Rain, which is the case with Navalny's shows, and YouTube has banned monetization, so it doesn't share its revenues, it doesn't allow Russian viewers to see advertising, that means that those who create that vital content don't get any revenue from YouTube, nor can they actually promote their content. And this is a big problem now, and they've been calling on YouTube to lift that, because it's hurting them much more than it's hurting the Kremlin propaganda, which is of course not dependent on financing from and sharing revenue with YouTube. They have plenty of money coming from the Kremlin. So YouTube is another channel. And the third is the very tech-savvy Russian computer engineers, IT specialists, have now developed special apps which you can install on your phone which do not need a VPN, and you can For example, you can read Meduza news on your phone without a VPN, and you can even listen to a radio station by simply turning on "stream it now." But given the situation, that then raises the question: how are those stories being sourced?

How are the journalists getting information out of Russia in order to get it back in?

That's an excellent question, Jason, because Russia is not yet North Korea. In some ways, it's sort of closer to Iran. I mean, there is censorship, it is a dictatorship, but it's a large country. People can still get information out by email, through social networks, through private chat groups. So a lot of the media that set itself up abroad still has sources inside Russia, mostly anonymous, but some people who are not political activists, who are analysts, just self-respecting Russian citizens, continue to talk to radio stations like Echo. Of course, this puts a huge responsibility onto them not to get their guests into trouble. I think there is a bit of self-censoring. By the hosts when they talk to their sources in Russia. But people are continuing to communicate, and this is an act of courage, and this is an act of resistance which has been surprising for all. And the most important thing is that for this outlet is to stay part of the information space with their public in Russia, because if they turn into emigré exile media, if Russians stop listening to them and stop watching them from inside Russia, then it becomes self-defeating.

And so all told, do you think this is doing what these Russian audiences need, providing the journalism and the truth that they're not otherwise getting?

Two things are going on here, Jason. One is, yes, I think these media outlets are providing the news, but they're doing something more important. In a way, they're keeping their audience together. They're giving a voice to people who can't at the moment speak freely in Russia. This might not be a huge audience. We think it's about 10-15% of Russian adult population, but these are the most active, these are the educated, these are the more liberal Russians who want a different country, who see their future differently. And keeping them together, keeping that sense of consolidation, keeping the sense of solidarity among their audience is just as important as providing them with news. These outlets might not change the views of the majority of Russians. In a way, you could say they're preaching to the converted, but that converted audience Keeping that is absolutely vital for the next stage in Russia's transformation. And just as important is for the journalists themselves to preserve their sense of agency and community, because journalism in Russia for— I was going to say decades, but it's actually centuries now— has been, if you like, a launchpad into politics. It has been a form of resistance since the time when Alexander Herzen came to London in the mid-19th century and set up The Bell, the Russian publication here. And since Vladimir Lenin has been editing his Iskro, or the Spark newspaper, first in Germany, then in London as well, Russian media in exile has always had an eye on Russia's future. But just as important, if not more important, of course, were the journalists who were inside the country. And it was the journalists who set the agenda for Mikhail Gorbachev's perestroika in the 1980s, and they were the ones who in a way gained financial and political power in the 1990s. And preserving class, and getting it ready, saving them, is a huge investment in Russia's own future.

Arkady, thanks very much for joining us. Thank you, Jason.

In her time, Gina Lollobrigida was considered the most beautiful woman in the world.

Fiamma Tarocco is culture correspondent and a senior editor at The Economist.

She was loaded with sex appeal, but she also had a mind of her own. She was incredibly hardworking and quintessentially Italian.

On the boat coming over We had a very glamorous fellow passenger.

In 1958, Orson Welles made a short black-and-white documentary about her. He was in his mid-50s, chomping on his cigars. She had just turned 30.

Authentic matinee idol, if ever there was one. Here's a funny thing.

And he confessed on camera that he'd been fascinated for years about how, in what he called the torn-blouse iconography of post-war cinema, Italian women surpassed all others. At raising the standard of glorious improbability of silhouettes. In a nation of fabulous females, he reckoned Gina Lollobrigida was the most fabulous of all. His film was never broadcast in the end. In fact, the print went missing for nearly 3 decades. But years later, after it was rediscovered and finally screened in Italy, This fabulous female became so cross at his portrayal of her that she persuaded the authorities to ban it. Gina Lollobrigida, or La Lollo as she was called, was born in the same hilly town in central Italy as Lucrezia Borgia. She was not even 13 when Italy joined the Second World War. She saw her home bombed by the Allies Her father's furniture-making studio lost all its stock in an air raid, and the family had to flee to Rome, where they ended up living in just one room. But she went to school, and after school she would take lessons in singing and dancing, drawing, adding to the family income with sketches of American GIs. She was a very good artist and modeling for comic strips that were known as fumetti. Keeping with the fashion of the day, she entered into a Miss Rome contest, which she won, and then she became a runner-up for the title of Miss Italy. And in 1950, when she was just 23, she was cast as a beauty contestant in a film called Miss Italia. Italy in the aftermath of fascism and Second World War was rebuilding its shattered towns, but also creating a new future in the film lots in Rome known as Cinecittà. On set, Gina Lollobrigida got a reputation for showing up on time, diligently learning her scripts, and being unusually hard-nosed about money. Studio executives used to ask her mother to convince her to play a part, saying that they would pay her 1,000 lira. She countered, "My price is a million." Soon she was making a new film every month. It was a studio photograph of her in a bikini that caught the eye of Howard Hughes. The eccentric businessman turned film producer had recently acquired RKO Pictures, and he liked cast women he was pursuing in films. He summoned her to a screen test in Los Angeles. She asked if she could bring her new husband, but she flew on alone. When the couple arrived at Rome airport and discovered that Hughes had only sent one air ticket, in LA, he put her up for 2 months in a posh hotel suite, gave her a secretary, a chauffeur, an English teacher, but really kept her in a gilded cage. She wasn't allowed to go out except in Hughes's company, and he would take her to cheap restaurants or even force her to eat in the car. He was terrified of being photographed. The best thing he did, she said, was that he taught her how to swear. Desperate to go home, she eventually signed a contract even though she couldn't speak English terribly well. She only learned later that it stopped her from making any film with another studio in America. She could, however, star in American films if they were shot abroad, and eventually she was in such demand MGM was prepared to pay the $75,000 fine that RKO demanded for breach of contract. If she returned to make a film in the US. American studios mostly cast her as a foxy temptress or an exotic fantasy. The Queen of Sheba, say, in Solomon and Sheba with Yul Brynner, or Esmeralda in The Hunchback of Notre Dame with Anthony Quinn. But that was really to misunderstand her irrepressibly, impenitently Italian nature. She was hardworking, she was stubborn, self-willed, but also in her way unbroken. Gina Lollobrigida may have lacked the guile and vulnerability that would have made her a much finer actress, but her essential Italian-ness not only led her to turn her back on Hollywood, it led her to embrace the work of her countrymen. Even if Hughes continued for more than a decade to dispatch lawyers to Italy to try and persuade her to divorce, Her success brought her money, it brought her fame. She bought a huge elegant villa on the Appian Way that leads out of Rome. This, together with the garlands of emeralds the jewellers would lend her for gala nights, and the seemingly unending legal wrangles towards the end of her life with the young lovers and assistants who were accused of trying to steal her fortune, All these gave the impression of a numerate, if slightly vexatious, harpy, one who was also, it must be said, rather heavy-handed with the eyeliner and the mascara. But to those who listened, she always insisted she was a simple country girl from the hills of Italy, one who gave her name to a salad called Lollo Rosso. Not naming its curly leaves a reminder of her own tousled tresses. Whenever it's cut, Lollo Rosso bounces back, which led it to be classified as a cut-and-come variety of lettuce. It's a valiant survivor, much like Lollo herself.

Via MetaRocco on Gina Lollobrigida, who died aged 95. That's all for this episode of The Intelligence. The show's editors are Chris Impey and Jet Gill. Our deputy editor is Jon-Joe Devlin, and our sound engineer is Will Roe. Our senior producers are Sam Westron and Rory Galloway. Our creative producer is William Warren. Our producers are Alizée Jean-Baptiste and Kevin Kainers, and assistant producer Barkley Bram, with extra production help this week from Sarah Lorniuk. We'll all see you back here on Monday.