The drive to bring jobs back to American soil is a compelling political instinct. But soundbites aside, Washington’s campaign to engineer domestic employment through tariffs, subsidies, and executive pressure reveals a fundamental misunderstanding of how markets and jobs actually work.
Jobs represent ever-evolving responses to consumer trends, resource development, market expansion, technological change, and entrepreneurial imagination. Some of today’s occupations — prompt engineer, EV charging station technician, dispensary budtender, app developer — couldn’t have been imagined a decade or two ago. Others, like food delivery drivers, household organization consultants, or telehealth coordinators, exist because consumers have demanded greater convenience and care.
The gig economy itself — a phenomenon barely imaginable before the smartphone — reflects exactly this kind of market-driven reinvention of work.
Value Is Discovered, Not Decreed
Carl Menger, in his 1871 Principles of Economics, argued that value is not an intrinsic property of goods or industries but a subjective judgment made by individuals based on their own needs and circumstances. And since needs and circumstances change, so too does the perception of value. Consider something as simple as diapers: a parent of young children assigns great value to a reliable brand like Pampers; that same parent, a decade later with grown children, assigns it none. The product hasn’t changed. The person’s needs have.
Friedrich Hayek understood why this matters for policy. In his 1945 essay “The Use of Knowledge in Society,” he argued that the information needed to allocate resources effectively is not concentrated in any one place — it is dispersed across millions of individuals, embedded in local conditions, personal preferences, and fleeting circumstances that no central authority can fully observe or anticipate.
Consider Play-Doh. The product now beloved by children worldwide began as a wallpaper cleaning compound. The putty almost faced extinction when vinyl wallpaper rendered it obsolete, but fortunately, a schoolteacher recognized that the non-toxic compound was ideal for children’s crafts. The product was rebranded and relaunched as a toy in the 1950s, and jobs associated with Play-Doh shifted from industrial cleaning supply manufacturing to creative play and childhood education. In 2024, the company rolled out Play-Doh Imagination Curriculum, complete with programming and educational materials that “have been developed by leaders in play and imagination, whose experience spans more than 40 years of expertise in qualitative research, inclusive design and creative arts.” Entrepreneurial adaptation drove the transformation — and no federal agency could have predicted it, let alone planned for it.
Consider PetSmart. When it was founded in 1986, PetSmart was a straightforward pet supply retailer. Today, the bulk of its economic activity lies less in product sales and more in services: grooming, training, boarding, veterinary care, and pet adoption events. This shift emerged because pet owners increasingly embraced their animals as family members and demanded services to match. PetSmart’s mission — to “help everyone experience more joy with pets” — reflects a broader cultural transformation. The most common reason for pet ownership today is pleasure and companionship, a far cry from the functional role animals once played. The jobs followed the values.
Consider Peacock. NBC’s streaming platform takes its name from the network’s famous multicolored feathers logo, developed in 1956 as a promotional tool to encourage Americans to upgrade to color television. Fast forward seventy years, and the consumption of home entertainment has generated an entire ecosystem of streaming-age employment: content creators, data engineers, and digital rights managers. These are not jobs that were moved from somewhere else — they were invented. As the broadcast industry shifted to streaming, the labor market transformed along with it.
Creative Destruction Is Not a Problem to Be Solved
The continuous process by which employment positions and old industries are dismantled to make room for new ones was coined by Joseph Schumpeter as “creative destruction.” In Schumpeter’s framework, the entrepreneur is the engine of economic transformation — an active disruptor who recombines resources in novel ways to meet emerging demand. The churn of job categories is not a market malfunction; it is the market working exactly as it should.
The 1991 film Other People’s Money dramatizes this tension with unusual clarity. Danny DeVito plays “Larry the Liquidator,” a Wall Street corporate raider targeting a small, family-run New England wire and cable company. His argument is unsentimental but economically coherent: the company is inefficient, copper wire is being replaced by fiber optics, and the capital locked inside it would generate far more value elsewhere. In the film’s pivotal shareholder meeting speech, Larry puts it plainly:
You know, at one time there must’ve been dozens of companies making buggy whips. And I’ll bet the last company around was the one that made the best goddamn buggy whip you ever saw. Now how would you have liked to have been a stockholder in that company? You invested in a business and this business is dead.
Just as the car replaced the need for buggy whips, so too will new innovations generate obsolescence for some of today’s products and positions. This is why the current push to repatriate manufacturing jobs through tariffs and executive pressure commits what some might recognize as a category error: treating the economic snapshot of a previous era as a permanent template for what American employment should look like. The jobs being chased are not lost — they have been superseded.
Protectionist measures also misread the supply chain reality of modern manufacturing. The components of consumer goods routinely cross borders dozens of times before final assembly. Tariffs inevitably raise costs for both producers and, ultimately, for consumers. Diapers illustrate the point concretely. The modern disposable diaper sold in American stores sources its superabsorbent polymers primarily from manufacturers in Japan and Germany, relies on globally distributed production for its adhesives, elastic components, and fluff pulp, and moves through an international logistics network before landing on a store shelf. It is, in every meaningful sense, a product of globalized supply chains — and it is better and cheaper for it. And given the rising costs of raising kids, parents need all the help they can get.
You Can’t Mandate a Better Economy Into Existence — But Entrepreneurs Can Build One
The cost of protectionism, however, goes beyond higher consumer prices. When governments insulate old industries, they do not merely slow destruction — they slow creation. The capital and labor locked up in a subsidized, tariff-protected sector are unavailable to the entrepreneurs building the next economy. Protection does not preserve prosperity. It mortgages it.
Now, none of this is to say that economic transitions are painless. They are not. Workers in disrupted industries face real hardship, and a society that cares about its members will want to ease those transitions. But the core lesson from Menger, Hayek, and Schumpeter must not be lost. Value is determined by individuals acting on their own preferences and the entrepreneur’s restless recombination of resources is the true engine of prosperity. The best employment policy, therefore, is one that removes obstacles to innovation rather than erects obstacles to change.
The jobs of tomorrow have yet to be realized. But one thing is certain: they will create value that no industrial policy could have molded or modeled. Giving entrepreneurs room to operate, rather than burdening them with the cost of propping up yesterday’s economy, is not indifference to American workers. It is the greatest service we can render.
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