The decline in manufacturing, however, is less a story about policy blunders than one about the long progress of the US economy, which has to a large extent graduated out of producing stuff like phones and cars and into the delivery of services, like finance and healthcare – a process similar to that followed by other countries that moved up the ladder of success.

I think this way of thinking is massively flawed. I really hate this idea that economic “progress” must necessarily mean making and building fewer things, and instead “delivering services.”

One, “delivering services” often means charging rents, meaning you’re moving from an economy that creates real value to an economy that extracts rents. A rents and service fee economy isn’t really an economy, it’s just a machine that creates inflation.

Two, no matter how far your economy moves up the “ladder of success,” people are always going to need material goods. Houses can’t be built of financial services and food can’t be grown on spreadsheets. We need real stuff to have a real economy. So what this means is that the “graduated” economies must become net importers of real, physical stuff, and/or net importers of poor people to do the work here that can’t be as easily moved to another country. We must therefore become dependent on other nations to make the stuff we need. How can a nation maintain its independence if it is completely dependent on other nations for all of its vital products? That’s not an independent nation, that’s a vassal state.

Three, all of this assumes that there will always be countries in the world who never “graduate” to our economic level, otherwise who would make everything? But isn’t the idea for every country to strive to reach our level of “success?” If so, who will make all the stuff when most of the world’s population is rich, working white collar jobs? Martians? And doesn’t this create an incentive for us to try and keep at least some countries poor so they can supply us with the cheap goods and migrant labor we need?

Real economies make things and create real value, they don’t just move money around and charge rents. People don’t just stop needing material goods once they get rich enough, and someone has to make and build that stuff, it might as well be us. Otherwise, if we come to rely on other people to make our stuff, we lose our independence and our ability to be self sufficient. That’s not the road to “economic success,” that’s the road to economic ruin.