The reason this is happening is because we are deferent to Wall Street. It's impossible for extremely high returns on capital to coexist with a robust and growing manufacturing sector.

Wall Street can and does demand that companies pay them dividends instead of investing in capacity. What you need is a willingness to accept lower returns on capital and higher savings rates. China makes those things happen, and that's why its manufacturing sector is able to grow the way that it does.

American technology and European technology are, of course, top-notch. What's different is the required return on capital and the labor market. Both of those are primarily dictated by industrial policies of the respective governments.