A Wall Street Journal report published this morning found that some of the main beneficiaries of the so-called Inflation Reduction Act are foreign-owned corporations, who have finagled unimaginable sums in green technology subsidies.

The Inflation Reduction Act has spurred nearly $110 billion in U.S. clean-energy projects since it passed almost a year ago, a Wall Street Journal analysis shows. Companies based overseas, largely from South Korea, Japan and China, are involved in projects accounting for more than 60% of that spending. Fifteen of the 20 largest such investments, nearly all in battery factories, involve foreign businesses, the Journal’s analysis shows. 

This report is instructive on a number of points: the difficulty of reshoring supply chains, and specifically the degree to which China is eating our lunch on battery production, even when that production occurs outside China; the fact that massive, unfocused subsidy programs are subject to abuse; and, ultimately, how the ongoing imbalance of trade hamstrings domestically owned industry.

The past few years have been all about splashy budget numbers and expansive subsidies. Rebuilding American industry—the creation and execution of industrial policy—is the foremost economic task before us today, but, as with all things, it can be done well or poorly. The IRA, for all the good intentions behind it, seems to tend toward the latter.