Mr Theo Mendez1
1The University of Melbourne, Australia
Biography:
Theo is a PhD candidate at the Asia Institute and the Melbourne Climate Futures Hub, University of Melbourne. His research interests span international political economy, focusing primarily on statecraft, industrial policy, and the renewable energy transition. Theo’s PhD project uses an international political economy lens to investigate state action in the context of a changing global order and the ‘New Washington Consensus’, focusing specifically on Australia, South Korea, and the United States. Before joining the University of Melbourne, Theo received a BCom in Economics and BA(Hons) in Asian Studies from the University of Western Australia.
Abstract:
The Inflation Reduction Act (IRA) was billed as a watershed moment for American climate, economic, and industrial policy as well as a cornerstone legislative achievement of the Biden Presidency. Both domestically within the United States and abroad, the policy has been interpreted as a decisive shift away from neoliberalism and as heralding a comprehensive return of the state to industrial policymaking. In light of these declarations and growing academic interest in the crafting of ‘modern industrial policies’, this paper asks: to what extent was the IRA indeed a transformative shift representative of a more comprehensive American statecraft project? In answering this question, the paper examines the inception of the IRA alongside the broader global industrial policy race that it precipitated. Through this analysis, which draws upon interview and secondary data, the paper contends that while the IRA has wide-ranging international implications, its potential to engender the type of domestic industrial transformation it seeks remains limited. I argue that instead of representing a domestically oriented techno industrial transformation project, the IRA and its global impacts are best understood as emblematic of two central features of the American political economy: the dominance of neoliberalism as a politico-economic mindset, and the importance of domestic political contestations between predominant social forces in shaping the direction of American statecraft. These findings extend contemporary statecraft research, advocating for a more comprehensive approach to understanding how and why states undertake statecraft projects, as well as what makes for successful statecraft endeavours.