Industrial Policy (CHIPS, IRA)

Industrial policy is when the government deliberately supports or steers specific industries through subsidies, tax breaks, or regulations—rather than letting the free market decide. You'll hear about it when Congress passes big spending bills like the CHIPS Act (which funds semiconductor manufacturing) or the Inflation Reduction Act (which incentivizes clean energy). It matters because these policies can create winners and losers among companies and sectors, affecting stock prices and investment opportunities. For example, if the government announces a $10 billion subsidy for battery makers, investors might expect companies in that space to grow faster. Critics worry industrial policy picks losers; supporters say it builds strategic industries America needs.