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U.S. Imposes Tariffs On Chinese Solar Cells
New submitter kimtysirt sends this excerpt from a Bloomberg report about U.S. tariffs for Chinese solar panels:
"The U.S. yesterday imposed tariffs of as much as 250 percent on Chinese-made solar cells to aid domestic manufacturers beset by foreign competition, though critics said the decision may end up raising prices and hurting the U.S. renewable energy industry. The U.S. Commerce Department ruled that Chinese manufacturers sold cells in the U.S. at prices below the cost of production and announced preliminary antidumping duties ranging from 31 percent to 250 percent, depending on the manufacturer. China criticized the action, saying the U.S. is hurting itself and cooperation between the world’s two largest economies. The decision is meant to provide a boost to the U.S. solar manufacturing industry, where four companies filed for bankruptcy in the past year."
But only because they were already artificially low, with China selling those things below cost just to gain market dominance. Hell, even with this, they'll STILL be artificially low, with the U.S. heavily subsidizing the whole industry. The fact is that solar power is just not that economical on its own (and IMHO is a pipe dream anyway, but that's another post). But seeing as the U.S. still subsidizes the wildly profitable coal and oil industries (and don't get me started on agricultural subsidies), I guess turnabout is fair play.
And before anyone jumps up to defend the free market here, you may want to keep in mind that a level playing field (with no protectionism) is great if you're a Chinese worker making $1 an hour--not so fucking great if you're an American or European worker getting paid many times that. You go ahead and compete in the "free market" with people willing to work for a fraction of your salary and just see what happens to your beloved first-world living standard.
What political party do you join when you don't like Bible-thumpers *or* hippies?
When US subsidize solar, it good.
When China subsidize solar, it bad.
I'm not a lawyer, but I play one on the Internet. Blog
China engages in all kinds of economic protectionism including artificially manipulating its currency not to mention import tariffs. So, by leveling these accusations at the United States, they sound awfully stale and hollow.
But only because they were already artificially low, with China selling those things below cost just to gain market dominance.
I've heard that said a few times but it seems nuts that China would sell these things at a loss, if that's really the case they will run out of money and be forced to stop fairly soon.
That's not necessarily true. They could be exploiting a resource. In this case, I will argue that China is exploiting their local environment and exporting products that are a direct result of using up that resource to countries that will not sacrifice that resource for money. Imagine if a solar plant in the United States could dump the tailings and cuttings anywhere they wanted or lay a pipe to anywhere that disposes of water and fluids used in the mechanical processing of said solar cells, they too could sell really cheap solar cells and panels. Lead, mercury, cadmium and the production of carbon dioxide are all still a part of fabricating photovoltaic technologies for mass production.
The very weak argument of how a free market is supposed to protect the environment goes something like this: people know pollution is bad and therefore they pay top dollar for the companies that pollute the least. If people don't think pollution is bad, then they buy the cheapest stuff and deal with it. And somehow the free market is supposed to work like this. Well, I'm glad for the EPA and I'm glad that the free market hasn't been left to companies that would rather spend money on misinformation campaigns than actual cleaner technology. Nixon opened trade with China and every president since has left it that way. As a result, we've found a loophole to get our cheap shit without polluting our local environment. But with CO2 having global impact, it's about time we started taxing products from foreign countries that don't want to play by our standards of environmental ethics (and it's obvious that China's national government is either helpless or corrupt). It's funny, if we applied tariffs in IT the same way, all the people complaining about outsourcing would be satisfied as now the ethical treatment and compensation of workers would be artificially raised by the US government to make it a toss up whether or not it is exported. Indian programmers are exploited by their companies in ways that American companies simply cannot.
Keep in mind, I'm not arguing for these tariffs, I'm just urging you to shift your point of view instead of assuming that the only thing the Chinese are losing in this proposition is a net loss on their sales. On the contrary, they're losing their environment and abusing human resources so much so that they are making a killing by their standards in profit. As such, it shall continue ad infinitum.
My work here is dung.
What you just said is tantamount to saying that in 1969, the "price" of a trip to the moon finally reached a price where the mainstream could realistically afford a ticket, because astronauts didn't pay for the ride.
If a government pays a price for something, then that nullifies the claim that the thing has become affordable. China is paying for your solar cells. Now, it might be either good or bad for China to be paying for your solar cells, but let's not pretend that the solar cells are actually cheap.
If the US was really interested in protecting an American industry, they could have chosen any number of industries that have been destroyed by foreign competition. Rather than protecting small solar companies, they're protecting dirty US energy companies. "Critics (people who understand the industry) say the decision may end up raising prices and hurting the U.S. renewable energy industry." Yeah, a small price to pay to keep your donors in the oil, natural gas and coal industries happy.
This sounds pretty good on the surface - the US government finally doing something that might positively effect the economy and workers.
Unfortunately, there is this thing the US belongs to called the WTO. And China is also a member. So, China will complain to the WTO which is all about free, tariff-free trade. WTO will come back with instructions to the US that these tariffs must be removed ... or else. The "or else" part is pretty much that China will introduce their own tariffs on the few US goods imported into China - but also that other countries will be enabled to also tariff US produced goods far in excess of what they are already.
So the tariff will be removed in a couple of months at most. We all signed on to the WTO and it is an organization that is clearly focused on a race to the bottom. All manufacturing will be in third-world countries with low, low, low labor and production costs. And the sooner the US population understands that the better.
We have seen the total number of skilled workers employed in the US drop in the last five years or so but it has been on the decline for some time now. Everyone is waiting for the government to "do something" to bring back skilled worker jobs so the middle class can recover and once again spend money on US-produced goods and services. Well, it isn't happening. Companies that employed 10 people doing a particular job have found they can get the job done with four people now. Between just pushing those four people harder and a lessening of demand, four are all that is needed. The other six jobs aren't coming back, not in any realistic time frame. We are looking at what the government says is 8% unemployment but in reality it is more like 30% - when you count the people that are working part-time as Walmart greeters becase there is nothing else. The government cannot force companies to hire back the workers they shed because they simply are not needed. The government cannot create new companies to employ people, unless you really want the WPA and CCC.
There is a basic assumption here that China is subsidising the cost of domestic solar production in order to force non-Chinese producers into bankruptcy, and therefore monopolise the future market.
But that is just an assumption; there is another hypothesis - that the Chinese government is subsidising the cost of solar to stimulate R&D and investment in an important sustainable energy source - exactly the same reasons given by governments elsewhere. Forcing the U.S. solar manufacturing industry to collapse wasn't the goal, it was just a side effect of Chinese manufacturers being more successful than U.S. manufacturers.
The basic allegation is that Chinese manufacturers get "unfair" government support in the form of low-cost access to land, bank loans, research grants and tax breaks. Do other countries not also do this? One of the Chinese manufacturers has already pointed out that China’s subsidies are lower than those in Germany. And is this even wrong? The U.S. subsidises oil and gas by almost $5 billion a year (and that doesn't include the cost of the U.S. military), nuclear is subsidised by $3.5 billion a year, solar at $1.3 billion. And yet, when China subsidises its energy production, suddenly such subsidies are "unfair".
China's solar subsidies are estimated at $34 billion. It sounds like a lot, but put it in context: China currently produces 2GW by solar, but has a domestic solar power goal of 15GW by 2015, and 50 GW by 2020. Within 8 years, China has to manufacture 25 times more panels than it ever has, expanding its solar capacity to the equivalent of 50 nuclear power plants. Of course, for this to be achievable they need to significantly ramp up panel production, which requires them to heavily invest (i.e. subsidise) their industry. It is very shortsighted to assume that China is building a solar industry in order to dominate and destroy Western manufacturers, when in fact they have some of the most ambitious domestic targets in the world.