The author revisits the history of American automaking to challenge protectionist myths often used to justify tariffs and trade barriers. He shows that domestic missteps, labor tensions, and macroeconomic shocks—not globalization—were the real drivers of Detroit’s decline, and argues protectionist policies like the 1980s voluntary export restraints delivered little long-term benefit.
Myths and Lessons from a Century of American Automaking
Economic Innovation Group
Adam Ozimek
Research
22 Pages
Key Takeaways
Industry resilience: U.S. factories still assembled 10.5 million vehicles in 2024, near the long-term historical average.
Detroit decline: Auto employment in Detroit fell from 220,000 in 1950 to under 100,000 by 1970, long before Japanese imports.
Protectionism limits: 1980s export restraints raised costs for consumers but added only ~1% to U.S. auto sales during the crisis.
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