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."

Comments

Yes, it will raise prices

[crazyjj]

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.

Re:Yes, it will raise prices

[dintech]

Devil's advocate: Maybe they should take it further and tax all products to the equivalent of government subsidies by foreign entities. Heavily subsiding is a practice that should be discouraged, irrespective of the product. While they're at it, they can stop local subsiding of things like high fructose corn syrup too.

Re:Yes, it will raise prices

[h4rr4r]

How would they run out of money? The government of China has and can force its banks to give loans that essentially never have to be repaid to these vendors.

Re:Yes, it will raise prices

[LordNicholas]

As always seems to happen during debates around trade tariffs and regulation, you're considering only one side of the equation (American workers) and not the other (American consumers). The majority of us who are not workers manufacturing solar cells benefit greatly from having a supply of cheap, foreign-made solar cells rather than expensive, domestic-made cells, which on the whole balances out the negative impact on American workers.

Our first world living standard is exactly because of these kinds of arrangements, not despite them.

You are correct in pointing out that "dumping" (selling solar cells below the cost of manufacturing them) is a true market distortion and should generally be discouraged, but I think it's naive to pretend that these tariffs are based on economics and not political pressures.

Re:Yes, it will raise prices

[Capt James McCarthy]

All they are doing is following the Walmart business model in a larger scale.

Re:Yes, it will raise prices

[jeffmeden]

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.

I would hope that anyone commenting here realizes that when it comes to China, "free market" is not even on the spectrum of economic principles. Currency manipulation that puts EVERYTHING in the world's second largest economy at a continuously under-priced advantage is about as close to the "free market" as North Korea is to joining the UN.

Re:Yes, it will raise prices

[SaroDarksbane]

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.

You're failing to make a comparison between what is seen (lost US jobs) and what is unseen (improved standard of living for everyone in the country because of cheaper energy-related goods). You're angry that other people might out-compete you in the job market, so in essence you want the government to use force to make sure that solar energy is kept more expensive so that all the other citizens in the country will subsidize your job.

That's kind of a jerk thing to do, FYI.

Re:Yes, it will raise prices

[h4rr4r]

They can corner the market on the cells. They did this with Rare Earths already. They undercut everyone on price, then starting instituting policies limiting exports of raw rare earths.

I would assume the long term goal is similar, limit sales of non-finished panels once there are no competing producers of cells.

Re:Yes, it will raise prices

[Anonymous Coward]

Once they've driven the competition out of business, they probably won't continue to sell them at a loss.....

Re:Yes, it will raise prices

[jeffmeden]

How would they run out of money? The government of China has and can force its banks to give loans that essentially never have to be repaid to these vendors.

Why would they? What would the Chinese government gain by flooding the solar panels market with things that cost more than they sell for?

Are you being serious? Dumping is a well understood practice. I will put it in Slashdot terms.

Step 1: Set up huge industry with government captial
Step 2: Start selling goods in foreign markets at well below what it cost to make them
Step 3: Watch as foreign competitors go bankrupt
Step 4: Crank up prices as no competition is left, then lend foreigners the money needed to buy goods
Step 5: ???

The question marks are at the end because the only thing unknown about this situation is whether china will use their wealth to simply buy up everything in the world, or to buy up just the military might and then watch as all the peasant nations fight over who will get to supply china with movies and music.

Re:Yes, it will raise prices

[mooingyak]

As always seems to happen during debates around trade tariffs and regulation, you're considering only one side of the equation (American workers) and not the other (American consumers). The majority of us who are not workers manufacturing solar cells benefit greatly from having a supply of cheap, foreign-made solar cells rather than expensive, domestic-made cells, which on the whole balances out the negative impact on American workers.

In the short term. When there's no competition left, the Chinese will stop selling them below cost.

Re:Yes, it will raise prices

[h4rr4r]

So manipulating your currency and selling products at a loss is out competing?

Are you misinformed or insane? The reason the GP quoted free market, is because when dealing with China there is never a free market, they don't play fair with their currency to being with.

Re:Yes, it will raise prices

[Nidi62]

If I can't have a free market, I'll settle for a fair one. Because even without this regulation we are not in a free market, as the companies dumping these goods are being supported and propped up by the Chinese government. Free market means no interference. Subsidies are interference and therefore NOT a free market. And these companies are definitely being subsidized by the Chinese government. This kind of behavior has been rampant from them for years.

And I really love the comment by the Chinese that this is the US hurting cooperation. The Chinese sure have a very odd definition of cooperation. This isn't cooperation; in most places that is called taking advantage of someone. True cooperation would be not dumping goods in an effort to gain market share. If they want to play games, we need to play right back. If they want to compete with us, they can play by the rules and try to compete. The sad thing is these kinds of laws are already on the books, the government just doesn't like to use them. If we enforced our own trade laws, we would stop hemorrhaging money and production capability to China, and we would actually begin to recover. Would things cost more? Probably, yes. But the money will at least stay in this country instead of going back to Beijing, where it'll be used to buy things somewhere else instead of being re-spent in America.

Re:Yes, it will raise prices

[geekoid]

The Chinese government subsidizes all solar cells in order to gain market dominance. They are doing this in other ways as well.

The Chinese know energy is where the money is long term. And the China government thinks long term.
This is the same reason they are putting roads into African Countries that have copper mines. This way the look good to the government, make contacts, and be in place to get the copper. Something that will be worth more then gold in 100 years, btw.

http://www.bloomberg.com/news/2012-02-02/china-cuts-subsidies-for-pilot-solar-projects-on-declining-costs.html

And of course labor there is very cheap and often subsidized.

My brother is in the Solar Industry, and they make cutting edge cells and China undermining the US market is killing RnD.

Re:Yes, it will raise prices

[Anonymous Coward]

That's not devil's advocate. That's a good idea.

Re:Yes, it will raise prices

[geekoid]

Control of the market. You are thinking way too short term. Think in decades.

Re:Yes, it will raise prices

[alexander_686]

Social Stability.

You can either

1. Fire a lot of people, breaking the pact that the Communist part can stay in power as long as they provided jobs and growth for everybody or

2. Take ill advised loans. Sure, there is a chance you can't pay them back - but that's o.k. - you can always borrow more money to pay back the nonperforming loans.

Chin'a capital system is susceptible to political power.

Or, another theory is that they are willing to subsides the venture until they become profitable. Sorta of like Microsoft and (XBox / Zune). Willing to loose money for years until they hit a break even point. Of curse, this ties nicely into my second point. What is the difference between an ill advised loan and a gamble for long term gains? I will give you a hint - it's the subsisted loans.

Re:Yes, it will raise prices

[geekoid]

The Devil would have enough sense to understand the things he talks about before making himself look stupid.

The fact that you want to stop Corn Subsidies tells me you really have a headline only knowledge of these topics.

Re:Yes, it will raise prices

[Anonymous Coward]

Go to Wal---t. Tip over the products. Does it say made in China or made in USA?

This is what happens when you can sell things at a loss for a sustained period. Social and environmental loss is easier to hide on a balance sheet but this just happened to be ridiculously obvious. Current economic losses are sustained by a cash cushion that manipulating currency and selling other things at a loss created.

They are just making sure that when the next economic revolution occurs they are on top of that wave as well.

Re:Yes, it will raise prices

[LordNicholas]

And they'll be able to sell them no higher than the market rate, which will be higher than cost plus a slim profit margin, just like any other product on earth. Raise the price too much and China's comparative advantage is lost, and Vietnam or India or maybe even the USA swoops in and sells them for less. Eventually we settle on the truest, cheapest realistic price for the product.

Guys, this is basic economics.

Re:Yes, it will raise prices

[Myopic]

Misinformed, not insane. Most of these free-market types are purposely self-deluded, although a small number are genuinely dumb. They're not stupid per se, it's rather that they ignore most of reality in order to focus on a tiny sliver of reality which, when misconstrued to extreme lengths, results in Libertariansim.

Let me be clear that this post is flamebait, not trolling. Trolling is when you say things that aren't true; flamebait is when you say things that aren't popular.

Re:Yes, it will raise prices

[geekoid]

No, these tariffs are economical. Getting something from overseas because it's cheaper doesn't actually help the American consumer. Unfortuantly the American consumer is short sighted and selfish. So when they have their cheap solar cells, but no jobs the can't figure out why.

China is a bad player.

Re:Yes, it will raise prices

[khallow]

Why would they? What would the Chinese government gain by flooding the solar panels market with things that cost more than they sell for?

Dumping is a common tactic for gaining market share. Competitors go out of business or get bought up by you. Then when you have enough market share and eliminated enough competition, you gain pricing power, the ability to price things above the rate in a competitive market. The profit from that can pay for the costs incurred during the dumping phase.

Re:Yes, it will raise prices

[goombah99]

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.

Do you have a citation for the claim that China is selling solar at a loss?

Well think about it. There's two reasons you sell things at a loss.

One is if it's an investment you will be making back later. In the case of solar cells this means buying market share, or if you are lucky buying monopoly pricing. You don't need monopoly pricing to earn it back because Market share is sticky. Market share comes not simply setting your prices or offering what people want, it's capacity, distribution networks, and standards.

Two is if you are looking at the wrong market. If there is a regional job shortage it may be cheaper for the Govt to subsidize and industry than pay unemployment costs. That would be unemployment costs not just to those workers but the whole regional economy it supports.

Re:Yes, it will raise prices

[HangingChad]

The fact is that solar power is just not that economical on its own

So? Neither is train travel, air travel, or highway construction. A good set of American made solar panels have a life expectancy of 20 years. That's a good investment in my mind, especially if we can hold off building new power plants.

Any big change in civilization comes at a cost that's rarely profitable at first, but it's the right thing to do.

The Chinese we're trying to undermine U.S. manufacturing by dumping panels below cost, it's about time we started fighting back. Republicans would have just gone, "Oh, too bad, the Chinese make panels cheaper...free market blah, blah, blah." And kiss those jobs goodbye.

Re:Yes, it will raise prices

[andydread]

Why would they? What would the Chinese government gain by flooding the solar panels market with things that cost more than they sell for?

Its called dumping see here

Re:Yes, it will raise prices

[LordNicholas]

And then when they jack up the prices again, what's to stop anyone from re-entering the market? Do you think there are significant barriers to manufacturing something as simple as solar cells?

Even assuming they bankrupt all competitors and then raise their prices, new competitors will come out of the woodwork to eat their lunch. It's not a sustainable long-term strategy.

This is a ridiculous argument.

Re:Yes, it will raise prices

[Myopic]

Would you really want a free market if you could have one? A free market is a market with zero regulations or taxes. Zero. Do you really want zero regulations? You can't even think of one single regulation you favor? If you can think of even one single regulation or tax that you favor, then what you want is not a free market, but a regulated market. Unfortunately, that then requires you to do the hard work of applying reason and subtle thought to the question of which regulations you favor, denying the opportunity to simply dismiss all regulations out of hand.

Markets are good. Free markets are bad.

Re:Yes, it will raise prices

[jellomizer]

Yes the low labor cost debate...
However the United States is much better as improving efficiency in the process. So one worker can do the work of many low wage workers. Now if China is selling things below cost then that is bigger issue, because then we are producing optimally, however the Chinese government is producing sub-optimally, in an attempt to monopolize the market.

While Labor cost is a big expense, it isn't the only one, and isn't normally the key factor. We are seeing a lot of In sourcing happening in the market right now. As they found out that this cheap labor is not cheap labor+the high efficiency that they were expecting, but cheap labor and low efficiency, which isn't saving them a lot.

The full Free Market has Huge ups and downs (Where the ups are excellent, and the downs are horrible). Now over our history we have put different amounts of regulations, Regulations tend to limit the Ups and Downs and stabilize the markets, so there is less extremes allows a stable predictable market and everyone is happy... however they are less happy during the upswing (and demand for more free market, which in turn creates a heavier down swing). Now too much regulation will keep everything at a statuesque. And this will hinder a lot of innovation, and new markets from emerging, so in time the economy will degrade as it isn't adaptable enough.
There is a careful balance that is needed for the optimal balance. It is like trying to hold the most amount of water in your hand. If you grasp too tightly you squeeze all the water out, if you let you hand be flat the water will then just rush out, you need to cup your hand enough for the optimal amount of water to stay.

However unlike grasping you hand where you can find the optimal range with some basic calculous, the economy isn't so predictable, so you need touchy freely work to get it right, and after you get it right it will change on you so you need to try again. The Lazy Political Motivated peole like to go to extreams of saying No Government or all government, so we just don't need to keep trying. However to stay optimal we always need to keep trying and going back and forth, with no end in sight.

Re:Yes, it will raise prices

[geekoid]

you would only have a point on an even playing field, it is not an even playing field.

China government is forcing the prices down artificially. This isn't competition. It's paying to control a market for long term advantages.

Competing in a manner where there are fewer and fewer jobs in the US is a spiral down, not up.

But hey, if another country stealing are RnD, then putting out a product below cost, flooding the market and destroying are industry is 'competing', then you are an idiot.

Re:Yes, it will raise prices

[alexander_686]

How do you calculate the subsides? We are not talking about direct subsides but indirect.

When a "private" bank (where the state owns shares and a party member sits on the board) offers a loan, how do you determine if it's cheap or just competitive? When the state has lax pollution controls, is that because they are favoring the industry or because they have their NIMBYs under control?

Or, my favorite example, Boeing vs.Airbus. Airbus has gotten launch loans - loans they did not have to repay if they airplanes designs failed. That takes a lot of risk out of a project - heads I win, tails you loose. We can measure that. On the other hand, Boeing was able to do a lot of aircraft desgin for the Defense Department / NASA which they transferred over to their civilian division. How do you measure that?

Re:Yes, it will raise prices

[dintech]

I thought this was common knowledge:

HFCS is cheaper in the United States as a result of a combination of corn subsidies and sugar tariffs and quotas.[19] Since the mid 1990s, the United States federal government has subsidized corn growers by $40 billion.[20][21]

Maybe it would help if you read beyond one or two of those headlines you're going on about.

Re:Yes, it will raise prices

[unimacs]

When there's no serious competition, market rate will be higher. If someone does try to come in to compete, the big manufacturers lower the price again until the fledgling competitor, whose pockets are not nearly as deep, drops out.

You see this all the time.

Re:Yes, it will raise prices

[afidel]

Exactly, think of it as economic stimulus but instead of infrastructure you end up with controlling marketshare in key growth markets.

Re:Yes, it will raise prices

[peppepz]

Yes, there are huge barriers to manufacturing something better and at a lower price than a monopolist who can count on a huge economy of scale. Cf. Microsoft vs the rest of the world.

Re:Yes, it will raise prices

[JustLikeToSay]

A better economist than me said "In the long run we are all dead" so I am always a bit cautious about asserting what will happen eventually - other than, of course, being dead.

Re:Yes, it will raise prices

[L4t3r4lu5]

You go ahead and compete in the "free market" with people forced under penalty of imprisonment / violence against family members to work for a fraction of your salary and just see what happens to your beloved first-world living standard.

FTFY. Result is the same, though.

This is free market economics at its best; We buy the shit they make, they keep fucking over the people making that shit.

Stop buying their shit.

Re:Yes, it will raise prices

[baffled]

Precisely! It's not like we're dealing with manufacturing automobiles, with nearly countless parts and exorbitant market entry costs.

This seems like a brain-dead move on the part of Washington. Solar energy provides cheap power, power to run countless things used by people in our local economies. Less money spent on utility bills is more money spent on local goods and services. Instead, all this will do is increase the amount of money Americans spend on coal to be mined and burned here - a small boost to jobs that will ultimately crumble because of global warming and alternative, green energy.

Stupid, stupid federal government.

Re:Yes, it will raise prices

[magarity]

Go to Wal---t. Tip over the products. Does it say made in China or made in USA?.

Walmart's gotten much better about stocking made in USA options; in most broad categories you can find a USA made item. Electronics of course are the exception. Even the clothing section has made in USA.

Re:Yes, it will raise prices

[AngryDeuce]

It's called dumping, and the whole point is to completely control a market (or control a large portion of it). It's a long-term strategy, meant to pay off down the road.

Perfect example is the TV industry. For many years, the U.S. was the main manufacturer of TVs worldwide, but then foreign competitors began dumping their own TVs on the market, selling them below cost, and now, there are no more U.S. TV manufacturers. They've completely killed the industry in the U.S..

Re:Yes, it will raise prices

[thaylin]

let see, New competition spend time and money rolling out manufacturing and doing research to catch up to the established monopoly, china drops prices just long enough to run them out of buisness, then raises them again.. Yep, looks like it can be sustained in the long run.. All they need to be able to do is make back the money of the dump during the gouging.

Re:Yes, it will raise prices

[Anonymous Coward]

Do you think it is inexpensive to setup a solar panel manufacturing plant? marketing and sales? back office support? distribution arrangements? you don't think this is terribly time consuming and expensive? all while knowing that at any minute the chinese could yank the rug out from under you and start selling the panels below cost? who would even invest in your operation knowing that reality?

Re:Yes, it will raise prices

[Rostin]

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.

It's also great if you're an American who wants to buy solar cells. Or a dock worker. Or someone who works in the import-export business. Or a solar cell installer. Why do workers in solar cell manufacturing deserve more consideration than everyone else who will be negatively affected? Proponents of tariffs seem to always forget that the economic consequences of government mandated ineffiency go beyond what they intended. If you really insist upon seeing this as a zero-sum, us-vs-them kind of thing with the Chinese, why not just be happy that they are helping us out by providing something at their own expense for much cheaper than we can produce it ourselves?

Re:Yes, it will raise prices

[hrvatska]

Becoming a PV manufacturer isn't cheap. What new competitor wants to enter a market where they know their main competitor can lower prices at will below the cost of production, and sustain that reduction long enough to drive most other companies out of business? So long as that uncertainty is hanging there it will severely restrict who is willing to enter the market.

Re:Yes, it will raise prices

[h4rr4r]

How much do you think it costs to setup a PV Fab?
Do you think anyone would give you that loan when these folks will just start dumping again until you are gone?

Re:Yes, it will raise prices

[AmiMoJo]

Maybe the rest of the world should do the same. How much subsidy have US car makes had?

Re:Yes, it will raise prices

[h4rr4r]

Those lifetimes are for 75% of output if you are willing to live with 50% output you can probably double or triple that lifetime estimate. It only becomes a question of if the cost of new panels is worth more power on the same area.

Re:Yes, it will raise prices

[tmosley]

"If you disagree with me, then you are uneducated"

lol

Re:Yes, it will raise prices

[TapeCutter]

A free market is a market with zero regulations or taxes. Zero.

"Free market" in the sense of a market with no rules, is an oxymoron. A "market" IS a set of rules/regulations for trade, the most basic of these being property rights, it's paradoxical nonsense to want a set of rules for trade that has no rules. The "free" in free market actually means anyone is free to participate in the market povided they play by the rules. I don't understand why such a large number of people in the US have trouble understanding the concept, they use it every day, no?

Re:Yes, it will raise prices

[AngryDeuce]

Even if it does, I'd be willing to put money on the fact that only a 51% majority of the product is actually made (assembled) here...or whatever the minimum amount required by law to be allowed to say "Made in USA".

Re:Yes, it will raise prices

[Impy the Impiuos Imp]

They can do every efficiency we can, and they still have more peasants waiting for jobs than our entire population.

And I'll go out on aa limb and guess you are one of these do-away-with-patent people. So so much for any remaining hope for the US.

And should some US person invent something major and make a massively profitable thing made here, you will just demand they have their taxes raised to "pay their fair share".

The US is over. The center of empire has shifted again, to the wild area on its outskirts, while the old core of empire has decided to lord over itself right down into irrelevancy, instead of doing what made it great in the first place, which was keep the trade routes open thile the even older empire, Europe, turned to lording over itself instead of keeping *its* trade routes open.

There's more to keeping trade routes open than just infrastructure, end you are clueless if you think a bridge helps when the government assigns highway robbers to collect 40% of everything passing through. You don't care and are oblivious to the concept of freedom.

Re:Yes, it will raise prices

[Impy the Impiuos Imp]

As opposed to low housimg loans or student loans in the US, both of which prompted by government, both of which causing price increases in the double digits for a decade.

At least their interference isn't due to slobbering pandering

Re:Yes, it will raise prices

[K. S. Kyosuke]

Step 1: Set up huge industry with government captial
Step 2: Start selling goods in foreign markets at well below what it cost to make them
Step 3: Watch as foreign competitors go bankrupt

Right, because the the US government capital absolutely, definitely has to be spent on military campaigns and equipment and on bailing banks out etc. and no money at all is available for the kind of R&D that the obscenely rich Chinese can afford to spend on.

Re:Yes, it will raise prices

[GodfatherofSoul]

You're not considering history and what we should already know. When you've allowed polluting, authoritarian, near-slave driving industries in some other country to drive your industries (with human, worker, and environmental safeguards in place) out of business, what are you left with? Either no industry, or you now have to abandon human, worker, and environmental safeguards to compete. We don't want to play that game.

Re:Yes, it will raise prices

[Pumpkin Tuna]

Exactly. Wal Mart did this when it first opened pharmacies in its stores. They cut their prices to the point that the individual Wal Mart pharmacy was losing money on every prescription. They could afford the loss because they were huge and the other products made up for the loss. A year or two later, when they had driven the local home-town pharmacies out of business, they jacked the prices back up.

Re:Yes, it will raise prices

[lwriemen]

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.

A truly level playing field would also mean a level standard of living. Worker rights, household wealth, and environmental quality would be the same everywhere. We'll never see that, so we'll never see a "free market".

Re:Yes, it will raise prices

[cpu6502]

I think the Commerce Department is flat wrong.

"U.S. Commerce Department ruled that Chinese manufacturers sold cells at prices below the cost of production." - Nooooo. Chinese goods are cheaper to produce because they make their workers work, and work, and work. Like how I bought my Chinese-made TV-CRT from China for $80. Same thing built in the U.S. probably would have been $400..... that doesn't mean China is "dumping" TVs.

Re:Yes, it will raise prices

[eugene ts wong]

I agree. The government wouldn't even really have to think about it. It would just need to pay attention to how much those manufacturers are being subsidized. It would encourage foreign manufacturers to compete on quality.

Re:Yes, it will raise prices

[s.petry]

Lets not forget that the Chinese had no ability to manufacture many products until they acquired technology. In many cases, this was government sponsored espionage.

A favorite story I have is from a VP in manufacturing, when they went to set up shop in China (as being required by a large US company). This was during the time we heard the tale that "If you want to sell products in China you have to build factories there". The VP toured other factories there that were owned by a UK firm that had been there for a few years and doing similar manufacturing. The VP was warned:

All parts of the plant construction process are going to be "monitored" by government officials. Every component will get measured, weighed, pictures taken, etc.. The day your factory completes and comes on line, you will be allowed a few days of production. During your initial production, Government monitors will be all over the place, writing down everything that gets done. Every process you have, every step you take, and every technical detail they can see will be written down. On about the third day, the Government is going to force you to close and nobody will be allowed inside the plant. When you are closed, they will send in a team of Engineers that will blue print your plant. This is to verify that you made no changes, and that their initial written specs were correct. After a couple days of "Government Inspections" you will be allowed back in your plant.

The VP was driven 2 miles away later, where he saw a plant that looked exactly like the UK plant. Oddly, they made the same thing as the UK plant, except that their products sold in China where the UK plant still had no ability to sell. The VP and Company did not open a plant in China, and are still doing very well to this day manufacturing in the US. The UK business went under about 9 years ago.

Re:Yes, it will raise prices

[Lonewolf666]

Option 2. is about to collapse for some EU countries right now (Greece in the first place, but Spain and Italy might not be too far behind). Because at some point it becomes obvious that you can't pay them back, and no one will want to loan you money anymore.

Now I have no idea where China stands in that regard, as I don't follow the news about their economy much (if the numbers are public in the first place). But it is something to keep in mind when borrowing lots of money...

Re:Yes, it will raise prices

[mk1004]

They've already done this with vitamins. There are no longer any domestic producers and the Chinese increased their prices as soon as the competition went away. Yes, we could re-enter the market, but the start up costs are non-trivial. And what's to stop the Chinese from doing the same thing all over again? That's what makes a significant barrier to market entry.

Re:Yes, it will raise prices

[SaroDarksbane]

"Manipulation of their currency" in this case is pegging the yuan to the dollar, meaning they print yuan and use it to buy dollars, which they then convert into US treasuries. In practical terms, this means that China is taking upon themselves the inflation that we would otherwise see due to our massive budget deficit, and as a bonus we get cheap goods. This is supported pretty heavily by the inflation data for both of our countries.

Far from taking advantage of us, we're taking advantage of them.

Re:Yes, it will raise prices

[emarkp]

Uh, Wal Mart is still selling generics at $4 per refill. Where are the raised prices?

Re:Yes, it will raise prices

[spiffmastercow]

It's an old strategy. The first instance of this that I can think of is the tactics of the 1800s oil barons, who would sell their oil at a loss until their smaller competitors went under, then jack up the price. I'm sure there are earlier instances of this though.

Re:Yes, it will raise prices

[Gadget_Guy]

It seems that everytime you link to an article, it doesn't match the point you are making. Your article shows that China is reducing its subsidy program, and it also mentions that European governments had their own subsidy programs too. The US has incentives of their own, so it doesn't make sense for you to pick on China for this.

Scroll down the page here for another link from you and we get this. So China has complained about the US subsidy program (just as the US complains about China). Once again, why do you pick on China? Most countries want to get ahead in this market, but there are other reasons for countries to support the renewable energy industries - like not stuffing up the planet!

Re:Yes, it will raise prices

[mikael]

They then have a technology lead and control of the rare earth metals or whatever is required to make them. Things will go the same way as memory chips.

Re:Yes, it will raise prices

[Tablizer]

Perhaps we are trading jobs for cheap trinkets, and China is doing the opposite so that idle, angry workers don't toss out the oligarchs and ask for democracy.

Our gov't bribes us with iPhones and $5 lawn-chairs to keep us fat and happy, and theirs bribes their population with jobs to keep them too busy to think about democracy. It's like a masochistic 4-way polygamist marriage.

Re:Yes, it will raise prices

[eugene ts wong]

I think that he is implying that lost jobs is equal to a lower standard of living.

Remember, it is very hard to innovate, so people who have invested time into building the solar industry will lose everything, just because another company is "cheating".

As for the lower standard of living, just because prices are high, it does not mean that westerners will have a lower standard of living. Prices might be higher than other countries, but if the domestic workers have a salary and it is much higher than what is necessary to buy a home and pay bills, then everybody will be fine.

That dream world will never happen, no matter what path you choose, if you insist on letting companies close down.

Honestly, if China can pump money into companies, then why can't the US take the money out?

Re:Yes, it will raise prices

[joocemann]

I think you missed the required reading about how it was not simply the cheaper general production in China, but rather massive deliberate subsidy by China to facilitate the anti-trust act called 'Dumping' to drive competing manufacturers out of business...

Re:Yes, it will raise prices

[uniquename72]

... now, there are no more U.S. TV manufacturers. They've completely killed the industry in the U.S..

Of course there are U.S. TV manufacturers, they just moved their manufacturing plants overseas (just like nearly every other type of electronics). This has nothing to do with "selling them below cost" -- labor is just more expensive in the U.S. so manufacturers can't compete. Strictly speaking, this can still be considered "dumping" according to the Wikipedia definition, but it has nothing to do with selling below cost.

Re:Yes, it will raise prices

[Myopic]

A free market is a market with zero regulation and zero taxes, but almost everyone who promotes "free markets" doesn't mean it that way -- including you. They mean they want an open, transparent, competitive marketplace. That's nice and all, but it's not the definition of a free market, and more to the point it's not the definition used by the people who are actually implementing policy. There is an incredibly tiny minority of ultra-rich industrialist ideologues who are trying to achieve REAL free markets, with zero regulations, and they are using as patsies, as fools, people like you, who bite on the mantra of a "free" market, without understanding what a free market is. If you don't want zero regulations, which it sounds like you don't, then let me be clear: you are being used unwittingly to promote a policy with which you do not agree.

Re:Yes, it will raise prices

[Luckyo]

Cost of contracts for military hardware awarded (as F-35 project shows, these are essentially risk free grants, not even loans and will be increased if initial designs fail until they don't), OR cost of RD if it was done independently (RD costs are most definitely found on company books).

Both are likely to eclipse "risk free" airbus loans by a wide margin.

Re:Yes, it will raise prices

[necro81]

Economies of scale are less important when you are talking about software. The costs associated with software aren't in manufacturing and distribution, which is where economies of scale really matter, but rather in the actual development of it. If you want a more direct example of " huge barriers to manufacturing something better and at a lower price than a monopolist who can count on a huge economy of scale", look to Intel vs. the rest of microprocessor industry. Leaving chip design and process development out of it, a top-of-the-line fab still costs several $billion, which is needless to say a huge barrier to entry. At lower volume there are contract manufacturers like TSMC, but then the economies of scale work against you, if you want to have a produce marketed at a competitive price.

Re:Yes, it will raise prices

[Bob the Super Hamste]

You while that would be true if there weren't any barriers to entry standing up a high volume solar cell plant seems that would be able to compete on the open market with ones from China seems like a fairly large one to me. It takes time to build and once built what would stop the Chinese from simply dumping their product on the market until the new company went bankrupt.

Re:Yes, it will raise prices

[Stuarticus]

The whole planet has been running on solar power since your G^99999P was feeding on sulphur vents.

Re:Yes, it will raise prices

[Paracelcus]

The first thing Obama has done that I agree with, but the import tariff should have been 800%! Coal/Oil should stand on their own feet, but agriculture is VERY different! We need to protect the American farmer! (I'm not going to write 50 pages as to why).

As to "alternative energy" I've got my own ideas! Let's run the world on the most abundant substance ever, human shit! "biomass" methane generated by human sewage! And have city/urban area localized power plants that would also be sewage treatment plants, this way it would only be necessary to use the main power grid during peak times.
 

Re:Yes, it will raise prices

[eugene ts wong]

I think that common sense is that most industries are subsidized in the US. If people want to argue that an industry is not subsidized, then they should be the ones who are required to prove it.

In short, I believe that all discussions should begin with the assumption that the industry in question is subsidized, unless there is common belief or are official statements to prove otherwise.

Re:Yes, it will raise prices

[Stan92057]

You mean they don't sell non generics?

Re:Yes, it will raise prices

[s.petry]

Won't be given in my case since the people I knew may still work there, sorry. There are numerous stories you can read on Google that are very similar.

Let me ask a few questions to get the point across. How many GM cars are sold in China? What is the number 1 selling car in China, and what does it look like? This is true for many items. Foreigner owned plants in China do not sell much to China, if they sell anything at all. Yet there are countless clone items made by Chinese manufactures in China that are sold to the Chinese. You can easily find story after story like this. The typical answer from the Chinese government is "We are working to stop IP theft", but occasionally you hear "China owns that IP so piss off!".

To the US, this may seem horrible and wrong. In China, to the Chinese Government this is as it should be. Plants are there to serve the people of China, not foreign interests. Foreign interests only get involved when it benefits China.

You can't argue Western culture and values when it comes to an Eastern culture and value system. This is why you won't see a Chinese manufacturer open a plant in America. IP created in China belongs to the people (aka. Government). This includes all aspects of production from design and engineering to building and distribution.

Sit with some people from China, have some long talks. You will really learn quite a bit.

Re:Yes, it will raise prices

[Stan92057]

I'm sure its expensive but do they need to pay the loans off in a couple of years instead of oh say 50? This is one product that should be made at COST IMO. This could make millions of lives much much easier if they cut out the cost of electricity. Hell if they just make panels so we can cut the cost of air conditioning it doesn't need to be the whole house.

Re:Yes, it will raise prices

[Anonymous Coward]

http://thinkprogress.org/health/2011/06/27/254700/walmart-raises-price-diabetes-medication

Re:Yes, it will raise prices

[Arker]

That's not true. A free market doesnt mean no regulation, that's absurd.

What it means is only regulation in the meaning of the word current in 1776. Since then the word has been stretched and distorted until people think regulation = dictatorship by bureaucracy with a million little rules covering all aspects of the business. In 1776, regulation was still understood as 'make regular.' A well-regulated market is one where the minimal necessary rules are enforced and barriers to entry are not artificially raised. Traditional rules concerning force and fraud must be enforced in order for a free market to exist.

Unfortunately we have developed in the opposite direction, with rules against fraud effectively gutted, and a million little (and some not so little) regulations to raise barriers to entry and protect the market incumbents against competition. That isnt a free market at all.

Re:Yes, it will raise prices

[Anonymous Coward]

You act like your beloved first-world living standard is something you're entitled too. The people you speak of are only willing to work for a fraction of your salary because of global inequality. Are they not people too? Do they not have the same hopes and dreams and wants? Or just continue living your unsustainable delusions. If everyone lived and ate like Americans the world could only support 2.5 billion people. Where there is inequality there will be revolution. READ THE WRITING ON THE WALL. CLIMATE CHANGE IS REAL. WE'RE PAST PEAK OIL.

Re:Yes, it will raise prices

[Arker]

So manipulating your currency and selling products at a loss is out competing?

People sell at a loss all the time, every grocery store has loss leaders. And the USA is in no position to complain about others manipulating their currency.

That said, it sounds like the Chinese are subsidizing this heavily. Hrmm, the US does the same thing dont they?

It's a self-defeating policy on both sides. If they want to sell at a loss, the best response is simply to let them. Let them waste their money, dont be stupid and waste ours as well.

Re:Yes, it will raise prices

[chrb]

So manipulating your currency and selling products at a loss is out competing?

If your aim is to establish a nation of manufacturing and high employment, rather than one which maximises profits, then yes, it is outcompeting.

The U.S. also has the power to devalue its own currency, which should stimulate manufacturing, jobs and exports at the cost of profits and perhaps quality of life (as imports become more expensive). The fact is that Americans don't want to compete with China on those terms. The U.S. could lower the average American income (and quality of life) to compete against the average Chinese factory worker (~$250/month), build huge factory campuses for the young people to work 100 hour weeks in etc. There don't seem to be many Americans arguing that the U.S. should do that.

If you try to compete in manufacturing, where cost of human labor is significant, against a country where the cost of a person is one-tenth the cost of your country, and those people are working more than double the hours in the week, then of course you are going to be non-competitive. Westerners are not willing to do what it would take to be competitive in these jobs.

Re:Yes, it will raise prices

[eugene ts wong]

No. Unless I don't understand your system, there should be records on what is and is not subsidized.

If we are talking about hidden subsidies, then we can just discuss principles. For example, "Sales tax subsidizes health care, which subsidizes smoking." We might agree or disagree with that, but the idea is that no official documents are needed, because we understand what is being communicated.

In the case of subsidies, it's not hard to disprove and prove.

Not being able to prove a negative is something that is impossible to do for statistics in the wild. There are probably other examples too.

Re:Yes, it will raise prices

[eugene ts wong]

Sorry.

For the last paragraph, I meant, proving a negative is impossible to do for...

Re:Yes, it will raise prices

[eugene ts wong]

Yes, thank you for clarifying.

In a way, it is almost like assuming that somebody is guilty, but not really. In the court of law, they are innocent until proven guilty, but in general discussions, it is not automatically so.

This is all just to facilitate discussion, and nothing more.

Re:Yes, it will raise prices

[chrb]

How many GM cars are sold in China? What is the number 1 selling car in China, and what does it look like?

The top selling car right now is the Buick Excelle manufactured by GM Daewoo and assembled in China by Shanghai General Motors Company Limited. This is a legitimate arrangement.

This is why you won't see a Chinese manufacturer open a plant in America.

Suntech Opens New U.S. Manufacturing Plant
China offshores manufacturing to the U.S.
Chinese Open First Car Plant in Europe

IP created in China belongs to the people

The United States successfully ignored international copyright and patent claims for over a century; it is hardly surprising that other nations that do not have a developed IP industry would follow the same route: An Economic History of Copyright in Europe and the United States

The U.S. was long a net importer of literary and artistic works, especially from England, which implied that recognition of foreign copyrights would have led to a net deficit in international royalty payments. The Copyright Act recognized this when it specified that "nothing in this act shall be construed to extend to prohibit the importation or vending, reprinting or publishing within the United States, of any map, chart, book or books ... by any person not a citizen of the United States." Thus, the statutes explicitly authorized Americans to take free advantage of the cultural output of other countries. As a result, it was alleged that American publishers "indiscriminately reprinted books by foreign authors without even the pretence of acknowledgement." The tendency to reprint foreign works was encouraged by the existence of tariffs on imported books that ranged as high as 25 percent.

The United States stood out in contrast to countries such as France, where Louis Napoleon's Decree of 1852 prohibited counterfeiting of both foreign and domestic works. Other countries which were affected by American piracy retaliated by refusing to recognize American copyrights. Despite the lobbying of numerous authors and celebrities on both sides of the Atlantic, the American copyright statutes did not allow for copyright protection of foreign works for fully one century. As a result, American publishers and producers freely pirated foreign literature, art, and drama.

Re:Yes, it will raise prices

[KhabaLox]

Even assuming they bankrupt all competitors and then raise their prices, new competitors will come out of the woodwork to eat their lunch. It's not a sustainable long-term strategy.

This is a ridiculous argument.

It's not a ridiculous argument, but I think it's weaker than the hypothesis chrb puts forth up above.

The barriers to entry are not solely related to the cost of physical capital investment. They are probably not small in this industry, but I doubt they are high enough to be a significant barrier to entry by themselves. However, if China were able to gain very large market share, such that they become technological leaders in the industry thanks to their much higher spending on R&D, that could act as another barrier to entry which coupled with cost of capital could tip the scales in their favor.

So, sure a US company could be founded in 10 years to compete with the Chinese, but they would be 10 years behind them in the quality and/or efficiency of their product.

Re:Yes, it will raise prices

[Myopic]

It's literally the definition of a free market. Literally. The definition.

http://www.investorwords.com/2086/free_market.html

"Business governed by the laws of supply and demand, not restrained by government interference, regulation or subsidy."

I didn't read past your first sentence, because as a rule I don't argue against people who can't be bothered to know what they are arguing about. Suffice it to say, if you advocate for "free markets" but don't want "markets with zero regulations or taxes", then you are a stooge being used by people who actually do want markets with zero regulations or taxes. What you probably want is a regulated market, perhaps one less regulated than the one the USA has today. That's fine, but it's not a free market.

Re:Yes, it will raise prices

[Solandri]

The thing is, corn isn't subsidized because the government wants cheap HFCS. It's subsidized because the government wants overproduction of food so we won't have people going hungry if there's a bunch of crop failures like in the 1930s. Cheap HFCS is merely a side effect ("gee, what can we do with all this excess corn?"). You can make completely valid and compelling arguments against cheap HFCS, but they won't get you anywhere because you're cherry-picking the most unfavorable aspect of corn subsidies to try to make them look bad. You're not addressing the real issue. The starvation argument will win out every time simply because it's more important. If you want to end corn subsidies, you need to address it from the starvation/crop failure angle.

Re:Yes, it will raise prices

[Myopic]

Thank you. Yes. People say "free market" but mean something else. They aren't saying what they mean, because they don't know what a free market actually is. That's political ignorance.

Yes, that's what I'm saying. Almost all (but not quite all) free-market proponents are politically ignorant of what they are actually promoting.

Re:Yes, it will raise prices

[Sebastopol]

Isn't that the same as deficit spending, kinda like the US?

Re:Yes, it will raise prices

[KhabaLox]

Even the clothing section has made in USA.

You realize that those clothes are made in the Marianas Islands and other US territories with much less stringent labor regulations than the actual states' part of the United States and wage rates comparable to those of China, right?

Re:Yes, it will raise prices

[Translation Error]

That's not putting it in Slashdot terms!

Ok, now think of China as Microsoft and solar panels as Internet Explorer...

Re:Yes, it will raise prices

[blackraven14250]

That's a fairly weak argument. A counterexample using the same logic is that the US used to have legalized slavery, so it's ok if the Chinese do it too.

Re:Yes, it will raise prices

[s.petry]

To your first point, it was thought long ago that opening plants in China would immediately open the doors to selling American branded cars in China. What is sold is not, and the profits are not shown in the US the same way it is for the EU. I guess it could be argued that GM does not sell cars the same in Europe either. The are many differences however. The biggest would be that GM production in the EU was not a pack shit and move operation, it was a true expansion. If this were true for China and Mexico, we'd never have had the collapse of the big 3 like we did. (Please, save any potential arguments about "but the Union's" for someone ignorant enough to believe that crap.)

To your second point, there are exceptions to every rule in economics. China will allow expansion if there is reason to expand but it must be of benefit to China as a whole. They will not allow a company to pack up and move to get a better labor rate in say Laos or Cambodia. There are also rules to expansion, such as critical IP and infrastructure must remain in China.

To your last point, I never said we were innocent and apologize if it was somehow insinuated. I just pointed out that others have very strict rules to protect themselves. If the US even talks about rules, we are labeled "Protectionist". Other countries operate with very tight rules to protect theirs and it's okay as long as we think we can exploit them to get more stuff. The West likes to believe that we somehow evolved into this "World Economy" and everyone plays by their rules. The truth runs very contrary to that belief.

Re:Yes, it will raise prices

[shutdown -p now]

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.

It's not a free market, because the labor is not free to move. If that Chinese worker could freely move into US or Europe where he'd get 8x as much for the work he does, do you really think he wouldn't?

From that perspective, tariffs and other protectionist measures make perfect sense - their purpose is to balance out labor market inequalities that are caused by state borders in the first place.

Re:Yes, it will raise prices

[s.petry]

Oh, and I see your facts are from a particular site. Maybe search a bit outside of that and look at the home grown cars in China (appearance, sales, etc..). Interesting that GM suddenly ranks number 1 in 2011 where as home grown ranked number 1 in every other year, in most cases by very large margins.

What you see could be more in line with the fact that China is producing lots of wealthy people right now. Buick sold in the past because it was the rich person's car.

Re:Yes, it will raise prices

[shutdown -p now]

As always seems to happen during debates around trade tariffs and regulation, you're considering only one side of the equation (American workers) and not the other (American consumers). The majority of us who are not workers manufacturing solar cells benefit greatly from having a supply of cheap, foreign-made solar cells rather than expensive, domestic-made cells, which on the whole balances out the negative impact on American workers.

American workers exist in the same economy as you, and are also consumers of what it produces. If they get paid less or lose their jobs, with nothing to replace them, the overall consumption in US economy goes down. This means that your salary goes down (or stays at the same absolute figure while money gets devalued).

Simply put, every time you buy cheap Chinese goods, you devalue your own money, making future purchases less cheap. Eventually you'll end up where you've started - with the real price of those goods being the same as those locally produced goods that they have replaced - except that you've ruined your economy in the process, while the Chinese have improved theirs. That's what they call "equalization"; just keep in mind that you're above average today, so any such equalization going to bring your life standard down.

Re:Yes, it will raise prices

[plover]

This isn't a "pro-American-jobs" move. It's an "anti-Chinese-monopoly" move. It just happens to have a component that resonates with a certain political demographic that likest to rally around "rah rah American-jobs!"

Setting up a silicon foundry to make the panels is a big investment. If Chinese firms dump cheap solar panels on America, driving American companies out of business, and then because they've cornered the market, they'll raise their prices high and keep them there, right? You seem to think that someone will come along and try making that investment again because prices are too high, but they won't. If there's no protection today against the monopolistic practices, why would I dump $10 million into a fab plant tomorrow, knowing full well that the Chinese will just drop their prices again and run me out of business?

Given that we have to play by anti-monopoly, emission-controlled, and pro-labor laws here, our market also can't support competition with external monopolies, uncontrolled polluters, and unregulated labor. Since we can't regulate their external business practices directly, the only tool we can effectively wield is to penalize the unfair imports.

What really has to happen to have an effect is for the tariffs to be tied to the specific behaviors we value. If we say "polluting is worth 150% of your cost of goods, underpaid, overworked labor is worth 100%, and monopolistic dumping is worth 50%", then they could choose to avoid the tariffs associated with pollution first. If we just say "Shen-zhen plant, we charge you tariffs of 200% because you're Chinese" they have no incentive to change behavior, they'll just to go try their dumping tricks on other countries.

Will any of this make solar panels affordable here (regardless of who makes them)? That depends on the non-solar energy markets. For comparison, look at the lighting market. Right now, high efficiency lighting isn't cost effective because electricity is cheap. Double the price of electricity, though, and the most cost effective lighting changes from incandescent to CFL. Double it again, and the most cost effective lighting is LED. The same is true with solar - as long as electricity is cheap, solar isn't cost effective. Raise the rates of electricity, and the balance will shift. Implement the smart grid, and suddenly solar panels will be the next big thing as customers discover that their A/C is costing them $50/per day using peak generating capacity. Or maybe solar will be effective only in the southern states, where A/C costs are the bulk of electricity usage, and the sunlight produces enough energy year round to make the panels worth it. They may never be effective in the northern states, where even the most efficient panels simply don't get enough sunlight to recoup their cost.

Re:Yes, it will raise prices

[jeffmeden]

Sure, what could be hard about purifying silicon, growing it into cell grade crystals, doping it properly, mounting it effectively, and applying high current connectors designed for a 20+ year life of safe operation. I am sure guys in garages can have all that running in a couple of weekends.

You think solar cell manufacturing at a large, economical scale has no barriers to entry, and then you call my argument ridiculous? This is some funny shit. Even for slashdot, you have taken absurdity to a new level.

Re:Yes, it will raise prices

[shutdown -p now]

Subsidies are interference and therefore NOT a free market.

It begins even earlier than that. Borders are interference and therefore the market in question is not free. The only reason why they can pay Chinese workers much less is because those Chinese workers cannot move to First World countries en masse (visas etc). That's artificial market segmentation. Tariffs are a way to deal with the imbalance caused by it. If you support free markets, you also have to support the 100% open borders policy, everyone is free to come except for obvious criminals and such. If that somehow doesn't sound like a good idea, then tariffs are a necessary evil.

Re:Yes, it will raise prices

[jeffmeden]

So, sure a US company could be founded in 10 years to compete with the Chinese, but they would be 10 years behind them in the quality and/or efficiency of their product.

BINGO. We aren't making wooden toys, or sunglasses; we are making technology-dependent, highly precise materials and assemblies that rely heavily on a very tightly controlled process and EXACT design specifications. Design specs that can't be downloaded from wikipedia. Processes that can't be started up in a few weeks (or probably years). This is a RACE. Putting a year or five or ten on your competition can mean EVERYTHING. Just ask Apple. Why do you think it is that they are selling 142 billion of product a year? They are 2 to 3 years (used to be more like 5) ahead of their competition, and that gap is VERY hard to close when it comes to technology.

Ask anyone working with manufacturing in China, and they will have stories to tell about how god awful hard it is to get something made the American way over there. Tolerances on locally made machines are crap. Training for employees is worthless (they leave as soon as you teach them something valuable.) Processes that get started, get dropped as soon as your flight back to the US is off the ground. It's hard as hell to change the course of manufacturing in a country. The thing is, they realize all of this. They are working around the clock to figure out how to out-do the US, and this is just another gun in their arsenal. The same is exactly true for what goes on in the US in any given industry.

China is doing what we did back in the 30s and 40s, stumbling their way through different techniques, technologies, and methodologies to find their way to effective manufacturing while they grow the workforce needed to actually maintain it. If they give their solar industry 10 years to perfect itself (largely based on workers trained by US companies, like I mentioned earlier) and they can keep the US solar industry from blossoming (which they have done pretty well considering how many US firms have gone bankrupt) then they will be in a leadership position, with the US a distant second. Do you really want to work for $1.50 a day?

Re:Yes, it will raise prices

[Nemyst]

Easy to say when you're not the one drinking the water they're pouring out. By using Chinese imports, you're basically endorsing heavy pollution with no regards for the consequences... yet buy those panels "to be green".

In other words, hypocrisy at its finest.

Re:Yes, it will raise prices

[TheEyes]

Step 1: Set up huge industry with government captial
Step 2: Start selling goods in foreign markets at well below what it cost to make them
Step 3: Watch as foreign competitors go bankrupt

Right, because the the US government capital absolutely, definitely has to be spent on military campaigns and equipment and on bailing banks out etc. and no money at all is available for the kind of R&D that the obscenely rich Chinese can afford to spend on.

You sound like you're trying to be sarcastic, but you may b more right than you realize. Nobody in the US will bother doing R&D for solar, or bother investing in an expensive manufacturing plant, if they know that they'll never make any money at it because the deep-pocketed Chinese government can kill your product at its leisure.

You have to keep in mind that the Chinese have a different mindset than you. To us Americans, two generations of right-wing propoganda have taught us that government is our enemy, and foreign countries are assets to be exploited. To the Chinese, their government is an ally, and you are the enemy.

Re:Yes, it will raise prices

[cpu6502]

>>>massive deliberate subsidy by China

So.
Basically.
China acted like us.
We also subsidized solar panel production via Solyndra and other government-sponsored companies. I guess we're guilty of dumping too. (And also hypocrisy.)

Re:Yes, it will raise prices

[Rimbo]

Your first paragraph analysis is correct. In fact, I'm somewhat displeased that the comments China and others have made that criticize this decision are essentially left in the article at face value, and that we need people like you to put this explanation in.

The market was not at all free, nor was it a level playing field, prior to this decision. Oligopolies and monopolies are not free markets; playing fields where one side has a government flooding money into subsidies are not level. So, your criticism of the "free market" in the second paragraph is based on a misunderstanding of what a "free market" is; "free market" is not a synonym for laissez-faire. Yes, I'm aware that a lot of proponents of laissez-faire equate it with free market economics, but two wrongs still don't add up to one right.

There's a similar problem with Dougherty's comments in the article, warning of a "trade war;" it seems to me that we were already in a trade war. A very one-sided trade war, where we just let China hit us with subsidized goods and did nothing to respond. Of course the bully will whine like a little bitch as soon as they get hit back...

Re:Yes, it will raise prices

[TheEyes]

Housing prices I'll agree with, but the cause wasn't really the "cheap" part of the loans so much as the "fraudulent" part: loans were given to people who flatly didn't qualify for them: they either lied on their application (with the bank being complicit); they were approved for loans based on the "teaser rate" rather than the actual rate they'd have to pay, etc. Then the bank sold these loans on the "open" market, hidden behind legalese that kept people from knowing these were really junk loans, and bet that they'd fail by taking out insurance policies against them. After that the inevitable happened: the unqualified borrowers defaulted on their loans, dragging down the banks; the insurance companies (AIG et al.) went under because they couldn't cover the credit default swaps they sold; and the economy went into a tailspin as everyone scrambled to recover what remained of their investments, which had all disappeared like the smoke and mirrors they had always been, while the bankers who had made all the original loans retired in opulence and spent millions to put the Tea Party in office last year to keep financial reform from going anywhere.

There you go; the last ten years of the housing bubble in condensed form.

Student prices, on the other hand, are almost a double-blind. On one side, private schools have not really gone up much beyond inflation in terms of the actual price students pay; the "list price" keeps going up, but so does the "need-based" or "merit-based" aid, such that the net result is that the average student at a private schools pay roughly the same as they did ten years ago. The list price goes up for the same reason Hollywood uses silly tricks to make it look like actors get paid hundreds of millions of dollars to star in a movie: the bigger the numbers on the list price, the more valuable the school looks to the student, even if in the end he never actually pays that ridiculously high amount.

Public colleges, of course, are a completely different universe: their costs have been going up considerably over the past few years, at first because more and more money has to be redirected from education to pay for lavish pensions that short-sighted politicians agreed to in the seventies, eighties and nineties to get votes, and now because states are losing tax money due to the recession. These costs are forcing states to reduce funding for public schools, which in turn explains why student subsidies are so much lower than they used to be.

Re:Yes, it will raise prices

[Dahamma]

The US hasn't been subsidizing US manufacturers, they have been subsidizing new car purchases in general. The goal was to get people spending money and get some clunkers off the road, not prop up US manufacturers. I'm pretty sure the government has paid more subsidies to people buying a Toyota Prius than any other model...

GM and Chrysler were bailed out by buying stock in them to allow them to go through bankruptcy without shutting down. But that's a very different thing from just giving them cash for each car they make so that they can sell them below production cost to compete unfairly with other manufacturers.

Re:Yes, it will raise prices

[g0bshiTe]

I'd be more inclined to think it's more about keeping people from US traditional power more-so than it's hurting American solar retailers. If it can be had for a fraction what's to keep people from jumping off the grid to solar. Right now the huge investment is really what's keeping me from going solar. While I wouldn't totally disconnect from the grid, I could power at least 75% of my household items easily off solar if it weren't due to the initial $10k - $15k start up. I'd still run things like heat and cooling off the power companies grid along with washing machine and dryer. The savings there would be huge alone.

Re:Yes, it will raise prices

[cavreader]

The US is still the worlds #1 manufacturer despite all the never ending BS trotted out. Add that to the fact that the US is still the #1 GDP and can replace anything imported from China from somewhere else or built domestically I think the increase in tariffs for all Chinese products is a good thing. Even the US rare earth operations are already being brought back into production. And finally China's economy would shrink by a 3rd without access to the US market.

Re:Yes, it will raise prices

[Anonymous Coward]

Only in places that have competition. In smaller towns where the local grocery stores do not have drug stores and no other drug store, they are over $8. Yes, they are more expensive than the original drugstore was.

Re:Yes, it will raise prices

[INowRegretThesePosts]

Why do you think Solar is not economical?

The Wikipedia article on Grid Parity says

This rate of price reduction is accelerating; between late-2009 and mid-2011 the wholesale cost of solar modules dropped approximately 70%.[2] This rapid reduction in price is unprecedented in the industry, and shows no sign of reaching bottom (late 2011).

I am actually very optimistic about solar power.

Re:Yes, it will raise prices

[INowRegretThesePosts]

That does not make sense. Dumping always harms the dumper. Lets see:

Suppose that China has a solar cell manufacturer called CrappyCells, and America has a solar cell manufacturer called LincolnCells. Both make solar cells that cost $95 and sell for $100. Then CrappyCells has the "brilliant" idea of capturing the market by dumping, so it start selling cells for $90. According to the plan, LIncolnCells will bankrupt, then CrappyCells can sell its goods at $200.

What really happens is that speculators notice CrappyCells is dumping, so they start buying and hoarding. As much as CrappyCells makes, the speculators buy. This means that CrappyCells is never able to meet all demand, and can't smother LincolnCells. Eventually CrappyCells will stop the dumping, either because they ran out of money or because they realised it wasn't working. Then the American speculators make a huge profit and CrappyCells realises it made a huge loss.

Anti-dumping legislation is nothing more than protectionism. It merely ensures the survival of inefficient domestic companies. This helps the shareholders and workers of said companies, but harms American consumers. And the global result is a net loss for the world economy, because of the inefficiency involved.

Re:Yes, it will raise prices

[_Sharp'r_]

Let's say I told you that I had a bunch of stuff you might want and I was going to "underprice" everything when offering it to you. Say, 50% less than you could purchase any of it elsewhere.

In what universe am I harming you? How are you not better off than if I decided to charge you more for my stuff?

Somehow when it comes to tariffs, people seem to lose their common sense....

If they want to sell us cheap stuff, we should keep buying it until they stop transferring their wealth to us, not tell them "No thanks, we'd rather waste resources making it for more ourselves."

Re:Yes, it will raise prices

[joocemann]

I think you missed some required reading on the china solar panel antitrust debacle. This specific product markedt was heavily 'dumped' deliberately to crush the US producers. Your post assumes the panels are only part of a greater scheme, not specific/deliberate to the solar panel market. The references came out months ago on slashdot on the "solara goes bankrupt" post where lotsof people like you assumed the ame as you are right now.

Re:Yes, it will raise prices

[baffled]

I agree with the relative effects of cost vs returns with regards to lighting and hvac, but your specifics I don't agree with. CFLs are more cost effective than incandescent now, they have been for years. Upfront costs: CFL $3, incandescent $1. Say CFL uses 33W less. 30 hours = 1kWh. In 7 days, that'd be just over 4 hours/day. 52 wks/year = 52kWh saved/yr. @ only $0.10/kWh, that's $5.20/yr savings. My electric costs are about 50% higher than that.

Also, heat pumps have been advancing the past decade, to the point where the seasonal operational costs are on par with natural gas for most of the northern half of the US. And they're still improving.. Combine that with solar electric reducing kWh costs, and it makes sense to go all electric.

As to the original argument, solar panel technology is still evolving. New plants will be built regardless. And the US federal government is already dishing out money to prop up solar manufacturers, what's to stop them doing the same in 5 or 10 years, after the technology is further along, and after we're all enjoying cheap solar electricity from our aging Chinese panels? The only argument I can see is the government is afraid the funding won't be available in ten years, with the rise of the tea partiers and changes in the global economy.

Re:Yes, it will raise prices

[Occams]

What a disgrace. The USA should heed it own rhetoric at the WTO.

Re:Yes, it will raise prices

[INowRegretThesePosts]

Overrated? This is crystal-clear moderation abuse!

Re:Yes, it will raise prices

[plover]

Yeah, the examples were really to point out that there are specific price points. The total cost of an electric device is the upfront cost of the device itself amortized over the life of the device, plus the electric costs over time (on an increasing scale as electric rates change over time),

Consider a set of three bulb choices, a 100W incandescent bulb is $1 that lasts 1,000 hours, an equivalent 26W CFL that costs $4 and lasts 6,000 hours, and an equivalent 10W LED bulb that costs $60 and lasts 30,000 hours. Let's say you use them 12 hours per day. If electricity is $0.15 (I'm assuming that's near your rate), the incandescent costs $70/year, the CFL costs $19/year, and the LED costs $15/year. Of course, you'll be changing the incandescent bulbs every 3 months, the CFLs every 2 years, and the LED every 6 years. So if the bulb is in a hard-to-get-to fixture, you'll spend a lot less time getting the ladder out to change it, and your chances of falling and hurting yourself drop by a factor of 30.

Usage is also a key factor: if you use them for only 15 minutes per day, the incandescent costs $1.46, the CFL is $0.39, and the LED is $0.32. The difference is the incandescent will last 11 years, the CFL will last 100 years, and the LED would last 328 years. Does anyone get full value from a 100 year lifetime? Will the CFL really hold gas for 100 years? Will we still be using the same kinds of technology in 328 years? If you put a maximum lifetime of 10 years on each, the LED bulb jumps to $6.14 per year, and the CFL doubles to $0.76, while the incandescent doesn't change.

On the other hand, the future is full of uncertainty. LED longevity figures are mostly predictions, and not based on field collected data, so will they really last 30,000 hours? Will LED bulb prices drop sharply in three years? Will electric prices go up or down?

Regarding HVAC costs, I have an air-source heat pump on a special "demand meter" that cuts cooling by 20 minutes per hour during peak generation times (they send out a radio signal to tell the meters to switch to controlled-load mode. For this, my electric co-op charges me only $0.057/kWh for all the usage throughout the year. Very cost effective, much cheaper than the gas. But being air-sourced, it stops being efficient at temperatures below about 22F in the winter, and my thermostat then calls for gas heat.

The problem with solar up here (at 45 degrees latitude) is that there simply isn't enough sunlight in the winter. 1 square meter at noon in July collects 1400W of energy, but the same collector in December sees only 60W at noon. And in July, it will produce for 16 hours a day, whereas in December it might produce for less than 8 hours. Because storing electricity isn't terribly efficient yet, it's not like it all balances out over the year.

This will help nothing

[tatman]

It might keep some producers in business for a while. But it will ultimately destroy US based business in this field. There is timeless and countless example of how protectionist trade policy does nothing more than hurt the ones its intended to help. Some protectionist policies have been utterly disastrous . The worst part is the CEOs and investors will hurt the least. The workers, the 9-5 employee, when they lose their job, they will suffer the most.

Re:This will help nothing

[h4rr4r]

You link said nothing of the sort.

What is the alternative?
Either they go out of business now because the Chinese are willing to lose money to put them out of business or we do this and maybe they last a little longer assuming we accept your claim.

Re:This will help nothing

[tatman]

There's other alternatives to going out of business. But even if if that's the only outcome, there's better ways to deal with the problem than starting a trade war over it. Trade wars have never had positive outcomes for average Joes (aka me). Trade wars benefit a few people with lots of money and political position. This might be a better link...see the section Consequences of the Smoot-Hawley Tariff

Re:This will help nothing

[h4rr4r]

What's the other alternative?

How would you combat dumping?
Try to remember that dumping and the over production Smoot-Hawley tried to deal with are very different things.

Re:This will help nothing

[geekoid]

Oh look, another person linking to Smoot-Hawley wikipedia page. The fact that you think that applies to this tells anyone who has studies this that you are a know nothing loud mouth.

Translation

[Compaqt]

When US subsidize solar, it good.

When China subsidize solar, it bad.

Re:Translation

[geekoid]

No.

When a country sells a product below their cost specifically to corner a market, it's bad.
Oh, and it's working:
http://asianbusinessdaily.com/2011/11/solar-wars-china-to-investigate-us-of-dumping-cheap-solar-panels/

Re:Translation

[afidel]

Yes, because a loan guarantee is exactly the same as what the Chinese are doing....

Re:Translation

[GodfatherofSoul]

Are you in China? It's not about subsidizes in general. China is propping up a new industry in their country at the expense of our own. China's practices are bad FOR THE U.S. Now, if you're some Flat Worlder who thinks running U.S. industries out of business is good for us in the long run because you can buy a $3 t-shirt that lasts 2 seasons, then party on, Wayne.

Re:Translation

[Dcnjoe60]

No.

When a country sells a product below their cost specifically to corner a market, it's bad.
Oh, and it's working:
http://asianbusinessdaily.com/2011/11/solar-wars-china-to-investigate-us-of-dumping-cheap-solar-panels/

Nobody seemed to mind when Japan was dumping hard drives and RAM chips at below cost and we all could get really cheap computers. Some would even argue that what made consumer electronics so successful is that Japan did this. Stores run loss-leaders all the time. Why is it okay for Walmart to sell something below cost to get your business? Why is it okay for the US Government to subsidize corporate farmers to sell products overseas?

Whether China gives cheap loans to its businesses or the US gives tax breaks to its businesses, aren't both governments essentially doing the same thing?

Re:Translation

[Specter]

Yeah, sure go ahead and mod parent post Troll; (s)he's completely right. This is nothing but a naked payoff for a (currently) favored US industry and on the whole everyone loses here except for the US companies getting the payoff.

Re:Translation

[Locutus]

the US is mostly subsidizing the purchase of the finished goods along with the cost of installation. ie they are moving money around more by this and even more so when the solar panels are manufactured in the US. When China subsidized it's manufacturing, that meant more US money( subsidized and not ) was not getting moved around inside the US any more and the US economy works by money moves around.

It didn't help that Obama backed some terrible designs for solar panels and those companies went belly up when the price for std flat cells dropped some. But instead of looking at this as a way to flood the US with cheaper solar energy they are more concerned with moving money around and could help to stall the movement away from foreign oil/energy markets again.

LoB

Re:Translation

[oreaq]

What exactly are the Chinese doing with respect to solar panels?

Re:Translation

[Compaqt]

Thanks for that.

The moderation on the post has been hilarious: Starting off at 1-Normal. Then 0, then 2-Troll, then 4-Insightful, now back down to 3.

A general rule is the more volatile the moderation on a post, the more truth it expresses.

Re:Translation

[Chris Burke]

More like:

"Hey, the horse has escaped! Quick, close the barn door!"

If we were going to penalize China for dumping and try to protect domestic solar industry, waiting until after Solyndra et. al. folded was kinda dumb.

Re:Translation

[Stuarticus]

Because one day you looked around and wondered why all the hard drives and RAM were being made elsewhere and no-one could or would make them at home again?

Re:Translation

[Dcnjoe60]

Because one day you looked around and wondered why all the hard drives and RAM were being made elsewhere and no-one could or would make them at home again?

That point would be valid if the US companies hadn't first moved their manufacturing to Southeast Asia, long before Japan started their dumping practices.

Re:Translation

[UltimaBuddy]

You seem to forget that business is one of many domains where cheaters prosper and bastards rise.

Trade Wars

[Anonymous Coward]

Begun it has!

Re:Trade Wars

[gtall]

Not quite, the report I heard on NPR was that the decision to impose the import tariff was made yesterday, but to be implemented starting in OCTOBER. So there's still plenty of time for China to stand up and wave their collective dick at the U.S. for having the temerity to call them on their dumping, and time for the U.S. to weenie out of it. And we can expect some sort of tariff in kind from them.

Only four companies filed for bankruptcy..

[BMOC]

... in a down economy and the whole industry gets a Tariff? There's some serious backroom "backscratching" going on. Did General Electric just toss out a huge campaign contribution?

Re:Only four companies filed for bankruptcy..

[tomhath]

You paid over $2.5 Billion on profits of $250? Time for a new accountant. (By the way, don' t bother linking to the NYT article that incorrectly implied that GE was getting a multi-billion dollar "tax benefit", they already admitted the article was grossly misleading).

Re:Only four companies filed for bankruptcy..

[Myopic]

Thank you for trying to educate me. You are still totally wrong, but I do appreciate being tipped to the subtlety of the story. Having dug into it, the best I can determine is that the GE tax is "small" -- that's the last word from GE, having realized how bad an idea it was for them to announce that they paid billions less than zero. Since GE refuses to be more specific, I think it is fair to assume that "small" is within rounding distance of zero. Since I paid more than zero, I stand by my assertion that I paid more than GE, but if you want me to be 100% literal about it, then I didn't pay more than GE by billions of dollars.

Forbes says billions in tax benefits in 2009
http://www.forbes.com/2010/04/01/ge-exxon-walmart-business-washington-corporate-taxes.html

Business Insider say GE is "full of crap"
http://www.businessinsider.com/ge-taxes-2010

CNN Money reports $0 in taxes
http://money.cnn.com/2010/04/16/news/companies/ge_7000_tax_returns/

Washington Post, deep down on the second page, reports a "small" tax liability, but GE won't specify; note that "zero" is the smallest number of all
http://www.washingtonpost.com/business/the-truth-about-ges-tax-bill/2011/04/05/AFZm0L9C_story_1.html

Re:This will work well...

[h4rr4r]

Why would this raise the prices of solar cells not made in China?

This is good news

[Tastecicles]

As someone who knows what foreign manufacturing does to local economy (UK based and lived through the death of Sheffield Steel and British Coal), this is the only fix - to impose tariffs on foreign made goods, because we do have the technology and infrastructure to make this stuff ourselves; the only thing we're doing by outsourcing is PUTTING PEOPLE OUT OF WORK. This (taxing foreign goods) stimulates the local economy; hands up those who think this is in any way bad??

I would do the same thing to fix the auto industry (and raw materials eg refined aluminium and steel/alloys). Why? Because we've outsourced to Japan and China, they're getting rich selling us shitty cars, while our local auto industry (which used to make quality cars most of which still run after 20, 30, 40 or even 50+ years! Jaguar, Rolls Royce, Leyland, Rover...) has died a death or sold out to BMW who get most of their coachwork from... CHINA!

Re:This is good news

[h4rr4r]

Quality British cars?
Have you ever owned a Jag? They only run after 2 months because of the time they spend in the shop. They only reason you see them 50 years later is because of their value making it reasonable to keep repairing them.

Any toyota made today is a better car than any jag made 20 years ago. Leyland was a joke, is a joke and forever will be a joke. I love British cars, but reliability is not their strong suit.

Re:This is good news

[b0bby]

we've outsourced to Japan and China, they're getting rich selling us shitty cars, while our local auto industry (which used to make quality cars most of which still run after 20, 30, 40 or even 50+ years! Jaguar, Rolls Royce, Leyland, Rover...) has died a death

Were you driving the same British cars the rest of us were? I have a 1970 Norton Commando; the quality of manufacturing on that bike is abysmal, down to the visibly off-center bore on one of the cylinders. That's not to mention the fact that the design was grossly outdated by 1970, but the management was too complacent to spend on a decent drivetrain which wouldn't pour oil out of every seam. There's a reason Honda ate their lunch, and it's not because they were selling crap...

And even today, I know someone with an $80k Range Rover; that POS died (as in, won't run, need a tow truck) on the highway twice in the first 2 years, and another time just poured its coolant all over his driveway for no reason. He still likes it (just like I like my Norton), but it's far from being a quality car. I'd have traded it in on a Land Cruiser after the first breakdown (if I had been silly enough to buy it in the first place, and still wanted an SUV).

Re:This is good news

[englishknnigits]

Wow, really? When you put a tariff on something it's primary effect is to raise the price of goods and services in your country. Tariffs on coal and steel would literally make everything in your country more expensive and lower the standard of living for everyone in your country. That is bad. The raised costs of goods and services in your country would also hurt your other exports. It also encourages other countries to put tariffs on your goods and services which hurts your exports even more, costs local tax revenue, and destroys jobs. If your country isn't very good at producing something (which is why it has a higher price than everyone else), it should make something else. You would be better off letting those workers in the coal and steel industry find other, more productive jobs and letting everyone else benefit from the low prices rather than imposing tariffs to protect an inefficient industry.

Re:This is good news

[vmlemon]

It might sound counter-productive (and maybe even hypocritical) - but if you want a British-built car (or at least a European-built one), then why not buy a new Honda (http://www.honda.co.uk/cars/campaigns/2011/madeinbritain/ says that they're built in Swindon), a new Nissan (made in Sunderland), or a new Ford (built in Dagenham)? After all, many of their European/UK-market models are either built by British people in plants based in England, or at least built in plants in the rest of Europe by native workers. Still, I don't care too much - but as a Brit, I'd rather the Japanese or Americans got my money if I was buying a car, than the Chinese.

Re:This is good news

[AmiMoJo]

No, the reason we lost out to Japanese car manufacturers is that all ours were shit. Rusty, unreliable and with poor electrical systems. Japanese cars were simply superior. Come on, since when were Austin or Rover known for their reliability and quality?

Protectionism doesn't work. Ultimately your product has to be competitive.

Re:This is good news

[Specter]

No, what you're doing is temporarily preventing a visible and politically favored group of workers from being unemployed while simultaneously putting other invisible and unfavored groups out of work now. A tariff is a tax on everyone who isn't a member of the favored group; they get to pay for the preferential treatment received by the 'in' group in the form of higher prices for current consumption. This is a net loss for your entire economy and it won't save the protected group in the end anyway.

Now, if you want to argue that it's a temporary measure to help ease the sunset of a failed industry in your home economy so that everyone can transition to something else, then fine, make your case. Of course, it's not. This is just a political stunt, a payoff for favored constituencies, and one more tactic out of the 'blame-the-other-guy' playbook for politicians.

Re:This is good news

[Bob the Super Hamste]

Yes. Apparently the parent isn't aware of the various Lucas Prince of Darkness jokes, or the world of British car humor. Although I am not sure who has the reputation for being worse at making a car, the British or Fiat?

Re:This is good news

[Bob the Super Hamste]

Hey those cars are good once they have been through a full frame off restoration with a full engine rebuild. Also it doesn't hurt to get all aftermarket electrical components and not even bother reusing any of the original stuff. It isn't just Austin and Rove, you also need to include BMC, Leyland, Jaguar, Morris, MG, Triumph, Sunbeam, etc.

Re:This is good news

[TheSync]

the only thing we're doing by outsourcing is PUTTING PEOPLE OUT OF WORK.

Or we are putting people into the kind of work in the West that should be done by advanced economies instead of that which should be done by third-world countries, enhancing the total output of humanity through specialization.

The West should be programming, making blockbuster movies with lots of special effects, etc., not forging steel or digging coal.

Re:This is good news

[Tailhook]

hands up those who think this is in any way bad??

I don't want that industry stuff in the environment. Keep it in Asia.

STOP TRYING TO MESS UP THE ENVIRONMENT!

Just stock my shelves with low low prices and keep that industry filth out of the environment.

Re:This is good news

[shutdown -p now]

The whole point of having separate states is that each state cares of its citizens first and foremost. There's no shame in that, it's basic common sense. "Mine" comes before "yours", be it a family or a country.

And it is doubly stupid to engage in charity towards another country which is pretty open about its policies which do not include returning the favor. Chinese government does what's good for China, period. They don't care about anything else. If you play along, they'll just use you to further their goals, milk your white guilt for all its worth, and then go tell you to fuck yourself once they fully establish themselves as the dominant power.

Re:This is good news

[INowRegretThesePosts]

Except that what you said makes no sense in the face of Economic theory.

Check out the book mises.org/books/defending.pdf and go to the chapter called "The importer".

Re:This is good news

[vmlemon]

On another note, I neglected to mention that Ford also build some vehicles in Turkey (certain vans, if I remember correctly) and Germany (at least one iteration of the Fiesta). I also had an idea of building a public "It's Not Made in China" database - so that people could submit details of products that they've either seen or own that (obviously) aren't made in China, in the hopes of tipping the balance a little (or at least to satisfy people who say "Why I can't I buy anything that's made domestically?").

Hyopcrisy

[DaMattster]

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.

Re:Hyopcrisy

[Dcnjoe60]

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.

Some would argue that the US continuously printing out more and more money is also artificially manipulating its currency. So the pot should be careful about calling the kettle black.

Re:Hyopcrisy

[Specter]

Obligatory FTFY:

The United States engages in all kinds of economic protectionism including artificially manipulating its currency not to mention import tariffs. So, by leveling these accusations at China, they sound awfully stale and hollow.

or to simplify:

Greedy politicians engage in all kinds of economic protectionism including artificially manipulating their currency not to mention import tariffs. So, by leveling these accusations at other greedy politicans, they sound awfully stale and hollow.

Well, *I* feel better

[pla]

Whew! Doesn't that just take a load off all our minds?

For a while there, it looked like solar had finally reached a price where the mainstream could realistically afford them and the electricity savings would eventually pay back the initial investment. Won't someone think of all the poor, poor coal-fired power plants in the midwest? I mean, if everyone had a solar array on their roof (perhaps even enforced by building codes), Dear Lord! We might manage to get by purely with some sort of socialist-inspired nightmare of on-demand clean gas-fired turbines!

And I, for one, know I will sleep better knowing that somewhere, a solid American union worker makes more than I do to press the red button and pull the lever every 49 seconds.


/ And if anyone considers this trolling, well, Greece would probably love your input on its current situation.

Re:Well, *I* feel better

[cyber-vandal]

As would that other failed state Germany.

Re:Well, *I* feel better

[Myopic]

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.

Re:Well, *I* feel better

[h4rr4r]

Failed state?
With a higher per capita GDP than the USA, longer life expectancy and similar laws. Care to explain?

Re:Well, *I* feel better

[pla]

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.

Seriously? If the Chinese government wants to subsidize US energy independence - Fucking LET them!

Re:Well, *I* feel better

[eugene ts wong]

This barely protect the coal power plants. It protects [or is at least supposed to protect] the solar manufacturers. In order to compete, people have to eat and pay bills.

But, hey, what do I know? I'm not an economist.

Re:Well, *I* feel better

[Myopic]

What I said: "Now, it might be either good or bad for China to be paying for your solar cells"

What you said: "LET them"

Okay. That might be the right thing to do. Or, it might not, there's more to it than getting cheap solar panels, but maybe that's the most important variable. I haven't thought deeply about it.

Re:Well, *I* feel better

[TheSync]

With a higher per capita GDP than the USA, longer life expectancy

To be clear, Germany has a significantly LOWER GDP per capita than the USA regardless of how you look at it:

GDP Per Capita
United States: IMF 48,387 WB 47,153 CIA 48,100
Germany (Nominal): IMF 43,742 WB 40,116 CIA 44,500
Germany (PPP) : IMF 37,897 WB 37,402 CIA 37,900

Re:Well, *I* feel better

[h4rr4r]

Sorry about that. Close enough to call a wash though.

Nothing like Mexico or Iraq. You know, actual failed states.

Re:Well, *I* feel better

[pla]

My apologies - I didn't mean my response to sound so caustic - Probably should have put a smiley at the end of it.

"So you'll only let me out of this prison if I sleep with a supermodel? Well twist my arm - Bring 'er on!"

Re:Well, *I* feel better

[Myopic]

I don't actually have a strong opinion about it. I'm not one to rant against government regulations or involvement with markets. In this case, a government is making a domestic product unnaturally inexpensive. Is that good or bad? Well, we Americans get cheap solar panels (probably good) but we also lose our own domestic solar panel industry (probably bad). Also, since China owns American debt, I'd say that Americans are signing up to pay full price for those panels at a later time, plus interest (probably bad). Nevertheless, as you point out, the panels will help marginally decrease our oil usage (probably good). It's a mix. I don't have a strong preference in this case, nor do I criticize yours.

My original point was a small point: these aren't actually cheap panels, they're just being sold for a loss. Well, maybe it's both.

Re:Well, *I* feel better

[TheSync]

The real question is why does a country like Germany, which is reasonably civilized (since WWII anyway), has a long history of success in chemistry, physics, mathematics, and precision manufacturing have a lower GDP per capita than the US, which has a long history of McDonalds and Starbucks :)

Re:Well, *I* feel better

[cyber-vandal]

I was responding to yet another retard on here using Greece as an example of the "ills" of state intervention. Germany is doing significantly better right now than everyone but China and somehow still manages to look after its citizens.

Re:What "domestic manufacturers" ??

[Trepidity]

I'm not sure what market share they have, but at least the company mentioned in this article, SolarWorld, manufactures its panels in the U.S. and Germany.

Seems fair to me

[peppepz]

Unless the Americans want to embrace the life style of the Chinese workers, they need to resort to protectionism. There can be no competition when the players do not follow the same rules. People will have to spend a bit more to buy solar cells, but I'd see that extra money as an investment, e.g. to keep the competences needed to build them inside the country.

Re:Seems fair to me

[peppepz]

Do you hear runners complaining that one competitors legs are too long and so time should be added to their runs to compensate? No?

I do hear runners complaining when competitors take drugs (build factories that pollute / explode / kill their workers) while for obvious reasons honest athletes aren't allowed to do it (there are environment / labour laws in place).

Your nation subsidies industry. You just don't hear the rest of us complaining because you live in a protectionist bubble that pretty much ignores the worlds complaints about your practices.

I live in a liberist bubble where I've lost count of the failures of free market, and I've seen the economy crash and burn while the free market prophets reassure us that in the end everything will be ok - while they take their money out of the country.

When the Chinese do it, its unfair.

No, the Chinese are entitled to do whatever they want with their economy.

When you do it, its a moral responsibility to keep American jobs yada yada.

I don't know what "moral" means. It's an investment.

Your standard of living relies on you exporting goods to the rest of the world

Then we need to change something because, for obvious reasons, we can't live in a world where every country is a net exporter, unless we start exporting to another planet.

I'm sure you'd be happy not being able to buy Chinese crap.. but your impoverished might not be so happy at how much they would have to pay to get comparable items.

The poor need a job to be able to buy things, no matter how cheap, in the first place.

Taxing the Environment

[eldavojohn]

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.

Re:Taxing the Environment

[eugene ts wong]

I wouldn't be surprised if they could withhold wages from those on the lowest rungs. The execs could argue that the competition is sucking away the money, and that wages will be coming soon. In the mean time, execs will get paid. When the workers are burnt out, then they will get fired without wages. By not paying wages, and then hiring fresh workers, they are literally lowering the cost of production.

I'm not saying that this is exactly how it is in China. I honestly don't know. I'm just saying that nothing is beneath a company, when profit is at stake.

Re:Taxing the Environment

[khallow]

That;s not going to last longer than one or two cycles. Then they won't be able to get people to work for them. The desperate aren't going to work for free any more than anyone else.

Re:Taxing the Environment

[eugene ts wong]

Yeah, but remember, it only needs to last 1 or 2 cycles. Also, the same desperation that feeds into lotteries can also influence here. Also, how are people going to know any better? If a former worker says, "Don't work there! You won't get paid!", then how will anybody know if the former worker is deceiving or not?

See ratemyemployer.com.

Those desperately looking for work can always rationalize, "Well, maybe you're just a disgruntled worker. Why is everybody else getting paid, and not you?".

Unpaid wages is not unheard of for a good reason, right?

Re:Taxing the Environment

[Arker]

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.

Uh no. That isnt even in the ballpark.

The way this is supposed to work in the free market is that if someone is polluting your water, your soil, or your air, you are supposed to be able to sue them, prove the damage, enjoin them from continuing, and collect damages for what was already done. This would prevent companies from externalising their costs in this way. When unable to externalise their costs, the real cost of production has to be paid, and included in the price of the product, and companies have a strong incentive NOT to pollute because they will be liable for the damge.

This free market method was not business-friendly enough, and so it has been superceded by statutory law and the EPA you are so fond of. The purpose of the EPA is NOT to protect the environment, as anyone who has paid much attention to it should realise. The purpose is to immunize polluters and allow them to externalise costs. The way it works is the EPA says a certain amount of pollution is acceptable, and as long as the company follows their rules, no one can sue them for the damage they do!

If the chinese are doing as you say (and it doesnt sound that far off to me, though I doubt either of us really know first-hand) that policy is self-defeating on its own. The best thing to do is avoid the temptation to respond in kind, and focus on keeping a proper free market here. In the long run they will only make themselves poorer, and us richer, and a few years down the road they will have no choice but to deal with the problems they are creating for themselves. It's sad for the common citizen in china, yes, but it isnt our governments job, or competency, to protect them.

Re:Taxing the Environment

[khallow]

Yeah, but remember, it only needs to last 1 or 2 cycles.

For solar cells? I don't think you can get enough out of a few months to justify the effort. I recognize that there's businesses that can be set up as you mention in a few months, but a lot of manufacture depends on relationships that last longer than a few months and employees that stick around longer than a couple of pay cycles.

In the US, for example, I gather the usual reason for stopping pay of workers is when the business nears bankruptcy and the owner or whatever is trying to buy a few more months of operation. Sometimes there's a relatively profitable reason for that (such as getting a buyer for the business or stretching out an executive's excellent) and sometimes it's just ugly denial of reality ("If we stop paying our employees and get a couple more months, then I'm absolutely sure this time that we'll become profitable.").

For the sort of scam above, the business has to have low enough costs (for example, low capital requirements) so that labor costs (if those wages were paid) are maximized. A telemarketing business would be such a business. All you need is a phone bank, a rental office, and you're good to scam. A solar cell manufacturer wouldn't be, because you need a factory, probably a rather large one, to play.

Re:Taxing the Environment

[eugene ts wong]

Sorry, I thought that you were referring to a couple of pay cheques, and not a couple of months of sales.

So, if it would only last a couple months of sales, then obviously it won't work, but I feel that if the assembly line tasks are mundane enough, then hiring new workers should be easy.

Re:Taxing the Environment

[JimCanuck]

I wouldn't be surprised if they could withhold wages from those on the lowest rungs. The execs could argue that the competition is sucking away the money, and that wages will be coming soon. In the mean time, execs will get paid.

People get executed in China for this quite often. Even one missed payment to a employee is justification for execution.

This kind of thinking appears to only work here in the West where people are idiots and believe that unpaid over time will eventually get paid out, in the mean time the company knows even if you complain about it the fines are relatively small and are pointless so they don't care if they keep doing it.

Re:Taxing the Environment

[eugene ts wong]

Wow. That's interesting. I've never heard of it.

It makes sense, though, because communism views employers as evil. At least, that seems to be a stereotype, so now that you mention it, execution for withholding makes sense.

Thanks for pointing that out!

So This is the Free Market System..

[rocker_wannabe]

Companies go on and on about the beauty of the "free market system" until it doesn't work for them. The U.S. government rushes in to help companies stay competitive but doesn't do much to help our workforce stay competitive. Helping U.S. companies does not help U.S. workers like it once did. Most companies depend on labor outside the U.S. to some extent. Why can't they put a tax on outsourced labor to make U.S. wage rates competitive?

I've never seen a U.S. congress that cared less about it's people than this one. The message from out government is if you can't figure out how to make a livable wage in this recession then just disappear so we don't have to deal with you. The real "kick in the head" is that if I didn't have to support our bloated local, state and federal government, deal with reams of regulations, and spend large amounts of money on insurance to protect me from a litigious society then I could be competitive with the rest of the world.

Re:So This is the Free Market System..

[GodfatherofSoul]

The "free market" doesn't work for anyone except the nebulous ether filled will global corporations who can flutter about from nation to nation as conditions change.

False Thinking

[SuperKendall]

Zero. Do you really want zero regulations?

Do you really want so many that only a handful of giant companies can actually work in the market, so many that no small business can ever start?

Because that is the other side of that coin.

You call for "subtle thought" while you apply the hammer of only considering "zero regulations" without thought to what happens when a market is over-regulated.

A truly free market is indeed preferable to a vastly over-regulated one, because at least the individual can enter it.

Re:False Thinking

[Myopic]

It's not false thinking. A free market is a market with zero regulations and taxes. A regulated market is a market with at least one regulation, or any level of taxes. There is no "other side of the coin" to a free market: it's a long sliding scale of regulation, and we can stop anywhere we want along that scale, but the entire scale is on the range of "regulated markets" and a "free market" is the end point, at the very bottom of the scale, with zero regulation.

You want a lightly- and smartly-regulated market? Yeah, great, me too. That's called a "regulated market". You want only regulations which ensure safety and transparency and competition? Yeah, great, me too. That's called a "regulated market".

A truly free market has not existed since the development of governments, and probably never will, but even if it could, I wouldn't want it. Preferable over a vastly over-regulated one? It's hard to say. I don't want either one of those.

Re:False Thinking

[Tyndmyr]

No. A free market is a market free from government interference, and where supply and demand determine pricing. Government sponsored dumping is the opposite of a free market. So, it was already pretty obviously non-free even before the tariffs. This is not a question of free market vs non free market, but rather, a deciding of which non-free option is superior.

Re:False Thinking

[Myopic]

I agree with what you said, and I don't think it contradicts anything I said.

There is no free market system...

[gestalt_n_pepper]

Anywhere. In almost every country, politicians are purchased by local business interests and serve as little more than "useful idiots" in the service of the wealthy. That's the world as it is, not as you learned it in civics class.

The actual figure is 31%

[Frankie70]

It's 250% only on companies which will start selling to US newly. Existing companies will pay only 31% tariff.

PROBLEM: china helps US get cheaper cleaner power

[bug1]

Damn these pesky chinnese customers and the superior products...

How dare they supply us with the means to reduce our dependence on foreign energy sources, help us get energy security, reduce our carbon footprint, do it cheaper than we can do it for ourselves, and probably lend us the money to do it.

They must be stopped.

What a bunch of crap

[doston]

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.

Tariffs are the problem with China

[Gothmolly]

In general they whack us with 10x the import tariff we apply to them - that is the problem. They're exporting their unemployment to the US, because if you have 400M unemployed young men running around, revolution-y things start happening.

Unlikely to have much of an effect

[cdrguru]

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.

Re:Unlikely to have much of an effect

[Faffin]

So, China will complain to the WTO which is all about free, tariff-free trade.

I spent some time checking the WTO anti-dumping page. The rules appear to be fairly tight, but it appears the US has followed them. I doubt China would have much of a case.

This isn't about helping US companies

[Dcnjoe60]

This isn't about helping US companies. The company that filed the complaint is SolarWorld, a German company operating in the US. They accuse China of subsidizing their solar industry with cheap loans, cheap land and cheap labor. Well, that is probably true, but then any industry in China gets the benefit of cheap loans, cheap land and cheap labor.

The fact that loans, land and labor in the US are higher than in undeveloped countries should not come as a surprise to anybody. What will happen from this, though, is to benefit the bottom line of a few companies, the prices of solar technology will increase, driving down demand. What this means is that the fabrication/assembly plants in the US (where the Chinese cells are assembled into actual panels) and the solar installers and contractors will lose jobs. If demand goes down, then even US based cell manufacturers will have less demand. It is a lose - lose proposition.

So, if the higher tariffs aren't to actually help the solar industry, then who benefits, by making solar or any other alternative energy more costly?

Re:What "domestic manufacturers" ??

[Dcnjoe60]

I'm not sure what market share they have, but at least the company mentioned in this article, SolarWorld, manufactures its panels in the U.S. and Germany.

Solarworld is a German company with a US manufacturing subsidiary. They're upset because they chose to build a plant where they can't compete with one built in a country that has 1/10th the standard of living. Go figure!

Anti-dumping

[grumpyman]

US said the same thing on Canadian softwood lumber. Talking about industry prop up by government capital? Please don't kid yourself - US automotive, banking...etc.

Re:Anti-dumping

[Widowwolf]

"US said the same thing on Canadian softwood lumber." We have no need for all your Softwoods now..We have Viagra!

Their timing stinks.

[Immerman]

So, we let subsidized foreign competition drive Solyndra and others to the point where recovery would be virtually impossible, then step in with tariffs that will drive the price of solar up high enough that they would have provided a cost-effective alternative if they hadn't you know, already gone bankrupt. While I agree that in principle the tariffs are a good idea, if I could find my tinfoil hat I'd wonder about established fossil energy interests playing a roll in the timing. Please, somebody tell me there are at least a handful of other innovators this will help out in the short term so I can feel like my government isn't a complete tool.

Free market

[DerangedAlchemist]

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.

The US never used to have this problem. Something like a $50/hour technician would maintain a machine doing the work of 100 Chinese workers that the company had invested time and money into developing.

The reason American/European/whoever were paid more per hour is that they were more productive per hour. Basically the GDP/capita thing. But there has always been cheaper labor in other countries that the US traded with and it was not a problem.

There are many reasons the why the US is destroying its competitiveness that can be argued at length. A lot of it boils down to loosing to countries like China or Brazil that are investing in their own country and people. Consider a few things like how class mobility in China has drastically increased, while in the US this is decreasing. If there is a huge financial barrier to get a University education, will you get the best and brightest or stupid rich kids with degrees? Is the US more or less of a place that rewards talent? If there are higher environmental standards to manufacture in the US, do you A) allow companies to move manufacturing out of the country, pollute more and sell the product back to you or B) only freely trade with those meeting your standards.

Re:This will work well...

[Specter]

AC isn't arguing that it changes manufacturing prices outside of China, he's arguing that the tariff will raise the cost to install solar and end up hurting (as usual) the very industry it's supposed to be saving. I think the AC is also implying that the majority of solar cells are made in China and that there's not another similarly priced source of cheap cells. I have no data to confirm or refute that assumption.

Since US manufacturers are arguing that their higher prices represent the true cost of producing cells, the tariffs should (in theory) bring the import prices in-line with the 'real' costs of the US manufacturers. At current prices ROI for a solar installation is still too long for most people. (Last time I looked ROI for me was seven years and I'm in a pretty optimal location to use solar.) If solar doesn't make sense for most people at today's allegedly subsidized prices then raising the total cost is only going to make the financial case weaker and reduce the number of solar installations (compared to what it would have been).

Tariffs are almost always a terrible idea; unless your objective is to buy off/payoff a favored constituency, which is exactly what's happening here.

Is this really about US solar manufacturers

[Anonymous Coward]

... or is this an attempt to prevent the large scale adoption of cheap solar panels that would cut into the profits of other (read fossil fuel) energy providers

Fine if their taxes reduce our prices

[A nonymous Coward]

I fail to understand the completely backward argument. What the heck is wrong with them taxing themselves to reduce our prices?

All I hear is "it puts our workers out of jobs!" which is EXACTLY the point of distributing manufacturing and other jobs around the world. If some region, whether it be a different country, state, or city, can produce something cheaper than most other regions, regardless of why, what is the point of the other regions insisting in producing it themselves? Better to put those inefficient factories and companies and workers on something else that they are better at.

Everyone should do what they ar ebets at, not what others are best at, because that leads to ridiculous things like subsidies (you have to make your inefficient products appear cheaper) and tariffs (you have to make the other efficient products look more expensive).

I would really like to know why so many people have such a knee jerk reaction as to think there is something wrong with letting foreigners tax themselves to make something cheaper for us, and why they think it good to raise prices for our consumers so our workers and factories and companies can continue to be inefficient in one area at the expense of not being more efficient than the foreigners at something we could be doing instead.

Re:Fine if their taxes reduce our prices

[dintech]

What you say is true but the government is probably speculating that Chinese prices will only stay artificially low (subsidised) while there is competition in the market. Once that competition has been eradicated due to inability to compete, the US government fears that the price could potentially be raised again back to a level the same or higher than what the defunct US companies were selling at. That obviously would be a bad outcome for both US producers and consumers.

Perhaps more importantly, they are trying to head off another Chinese monopoly. This might be shrewd since we've seen that the Chinese have prior history of wielding monopolies as weapons to achieve political ends. A recent example being the rare earth metals fiasco.

Re:Fine if their taxes reduce our prices

[A nonymous Coward]

That doesn't hold water. Extrapolate to the extreme: what if the Chinese did subsidize everything and then cut the subsidy and take huge profits, not to mention strategic control of vital industries?

First off, they can't. They don't have enough tax capability to subsidize more then a very few industries. And whatever they don't subsidize and export, well, they have to buy from foreigners, and their very own policies will have made the foreigners better competitors in those fields which they chose to not subsidize.

Second, monopolies are overrated as damaging to the economy and consumers. What happens if any monopolist strangles competition that way? It's the same old story: the foreigners will quickly start producing the product themselves, probably in a different manner, and the subsidized industry will be locked in to the old way of making the product and fall on its face.

Rare earths is a fine example. Mines in the US at least, no doubt elsewhere, which had been closed because they couldn't compete, suddenly sprang back to life, the Chinese backed down, and now not only is the Chinese price still dropping, the US mines are still in operation. The Chinese wasted a lot of taxes to very little end, and the rest of the world got cheap resources for a while at their expense, and a lot of new mines opening up which will result in lower prices overall.

Look at how well the oil embargoes of the 1970s worked. They caused short term disruption, but inflation adjusted prices still haven't recovered.

There are all sorts of examples in all sorts of industries. Monopolies cause short term disruptions, but the backlash impoverishes the monopoly and enriches the world in the long term.

You are wrong and short sighted

[A nonymous Coward]

When society / the government insists that we have to pay more for something because we demand tat it be made here, we suffer in two ways: first and most obviously, in higher prices. Second, in rewarding inefficient producers who would be more useful in some other field where tey are more efficient than the subsidized foreigners.

Rewarding inefficiency while punishing consumers is the epitome of stupid economic thinking and the natural way for bureaucrats to think; they like to spout simple minded nonsense while distracting attention from logic because votes are easier to get that way.

Is Solar Panels are so great. . .

[JSBiff]

. . . Why isn't China basically buying up all its own production and using them to produce power for China?

The fact that they can "dump" solar panels on the U.S. and European markets speaks volumes to how the Chinese themselves view the tech, don't you think?

250% tariff? Piffle. :-)

[sgtrock]

Given China's well known dumping tactics in this market, it made sense for the U.S. to increase tariffs to match it in order to preserve the domestic industry.

But in all honesty, this really doesn't matter a whole lot because the evidence indicates that solar cells have been following an exponential efficiency curve for 30 years. At this rate it won't be too long before solar power becomes a viable alternative for some large scale uses. It already is plenty cheap enough for small scale use.

tariffs

[Khashishi]

So, how big is the tariff we impose on foreign oil? Oh wait, we don't tariff foreign oil. But we do tariff foreign ethanol 54 cents a gallon.

Dollar/Yuan cost is a red herring

[Rogerborg]

It's all about energy subsidies. These things are fraking energy sinks; we're pouring fossil energy into making them that we'll never see back over their lifetime.

Oh, you'll see calculations to the contrary, but they don't factor in the energy cost of keeping the people in the manufacturing chain alive. And if that doesn't concern you, well, sooner or later the uncaring boot of physics is going to step on your neck and make you care.

Re:It's the economics, stupid!

[Khashishi]

So, what manufacturing breakthrough does China have that US doesn't?

Why use facts when you can assume?

[chrb]

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.

Re:Why use facts when you can assume?

[Ogive17]

My only counter-point to your post is "if there is no intention to achieve a global monopoly on solar cell production, why is the Chinese gov't allowing heavily subsidized solar cells to be exported in such high quantities if they have set such a lofty goal for solar production/use in China?"

By no means is the US an angel when it comes to trade agreements.

Re:Why use facts when you can assume?

[poity]

In response to your 3rd paragraph, the issue is not that China is wrong to subsidize, but that the US is not wrong in adding tariffs onto Chinese made panels. Subsidies are not inherently wrong, neither are tariffs that offset them. Look at the price of foreign cars in China, a mid-sized Buick is priced at over 50% more than a similar model bought in the US. These Buicks are made in China too, so shipping cost isn't the issue.

Your final paragraph is interesting since I've addressed the issue before: if the goal is to help domestic solar production and adoption, then there is no need to subsidize export panels, the government only needs to subsidize domestic consumption. That this is not the case, points to a deep flaw in your premise.

Re:Why use facts when you can assume?

[icebike]

Actually the deep flaw here is probably in assuming that the Tariff is actually based on the cost of China's production at all.

When you dig into the US dumping regulations you quickly find there is no requirement for any audit of costs or subsidies or anything else. It all amounts to speculation, often taking US/Western manufacturing costs as a basis, then simply substituting Chinese average wages and calling it a day.

In antidumping duty proceedings, the Department determines margins of dumping by comparing normal value with the export price of comparable merchandise.

Anti Dumping tariffs are pretty much a joke. You can game the calculation any way you want.

I would be much happier if the US simply said it is in our national interest to have a strong on-shore solar industry and leave it at that.

Instead, this administration is still smarting over the Solyndra failure and looking for someone who isn't running for re-election to take the blame.

Re:Why use facts when you can assume?

[CrimsonAvenger]

My only counter-point to your post is "if there is no intention to achieve a global monopoly on solar cell production, why is the Chinese gov't allowing heavily subsidized solar cells to be exported in such high quantities if they have set such a lofty goal for solar production/use in China?"

Because selling lots of panels, to whomever you sell it, encourages manufacturers to increase capacity?

Note the biggest problem with the "they're going to put everyone out of business and then raise prices"argument - solar isn't mandatory.

If the price of solar panels go up enough, people will just stop buying them. It's not like rare-earths, which are pretty much mandatory - solar is a luxury right now....

Which means we can just stop buying them when the prices go up, start up our own solar manufactories just to force China to lower prices, then buy at the lower prices again.

Lather, rinse, repeat....

Re:Why use facts when you can assume?

[chrb]

the US is not wrong in adding tariffs onto Chinese made panels.

'Wrong' is a moral judgement; the only effect of tariffs will be to increase the cost of solar panels in the U.S. Is that wrong? As Churchill said, "Will the shutting out of foreign goods increase the total amount of wealth in this country? Can foreign nations grow rich at our expense by selling us goods under cost price?"

Your final paragraph is interesting since I've addressed the issue before: if the goal is to help domestic solar production and adoption, then there is no need to subsidize export panels, the government only needs to subsidize domestic consumption.

I think this issue is actually quite complicated, as there are many factors involved. One is a desire for national energy security and independence, reducing reliance on fossil fuels etc. Another is a desire to build a profitable manufacturing base, creating jobs etc. If the goal is to ramp up production quickly, then the fastest way to do that is to give money to the people building factories. Subsidizing consumption will only work when there are consumers to subsidize; I'd imagine that in China the consumer in this case is the national electricity generation company. It is very difficult to separate out the effects of subsidies here anyway; isn't a consumption subsidy in effect also a production subsidy? Let's hypothetically suppose that China had subsidized consumption by guaranteeing that the state electricity company would buy $30 billion of solar panels. This investment would have led to new factories being built, increased economies of scale, more efficient processes etc. which would in turn result in a fall in the manufacturing cost, which would cause a fall in the end user price. More production = more supply = lower cost. So, when the subsidy is based on consumption, and the consumer happens to be the state electricity producer, can you really say that this is not also a production subsidy?

I will also note that other nations also subsidize production - the U.S. subsidizes production of oil and nuclear, and (usually) taxes consumption, many nations subsidize production of food rather than consumption - so the leaders of these nations must also see some benefit to subsidizing production rather than consumption. The main benefit being, that your nation now has the means of production, and therefore gains some degree of independence and creates some jobs. You can export and sell the excess, but taxing your people and using their money to subsidize production for other nations is not going to increase the total wealth of your nation in the long term. The monopoly argument does not hold - the entire cost of the Solyndra plant was only $733 million. The U.S. budget this year is $3.7 trillion. If the U.S. ever wants to get back in the solar manufacturing industry, it has the means to do so, and if it is a national energy security issue then $733 million is chump change compared to the cost of oil wars.

Re:Why use facts when you can assume?

[_Sharp'r_]

Instead, this administration is still smarting over the Solyndra failure and looking for someone who isn't running for re-election to take the blame.

No, they're probably looking to prop up several more Solyndras so they don't fail before the election.... but call my cynical, I suppose.

Re:This will work well...

[Khashishi]

Do you mean intended consequences?

Re:250% tariff? Piffle. :-)

[TheSync]

Given China's well known dumping tactics in this market, it made sense for the U.S. to increase tariffs to match it in order to preserve the domestic industry.

Why? Can you provide one example of a US industry that was "dumped" out of existence?

If the Chinese government wants to spend their tax dollars giving Americans cheap solar cells, why should we stop them?

If anything, we should be happy to get back some of the dollars we send them for making iPads, etc.

250%?

[Bender Unit 22]

The panels used in the solutions I've seen we're only 30% cheaper then the eu brands. But maybe they are a lot cheaper in the US.
I have seen cheaper panels on eBay, so I figured that the installer charged overprice for them.

I ended up buying a solution with eu panels which also had 12 years warranty and 10 years on 90% effectivity and 25 years on 80%.

Since we have one of the highest electricity price in the world, they have paid for them self in 8 years. Including the loan.

Right now the banks have "energy saving" loans at 4,8%. If paid back over 10 years, it costs nothing to install the panels in the monthly budget and then you still have at least 15 years of life in them. The inverter might need to be replaced.

We are 2.5 million households in the country and the organization that coordinates the infrastructure between the electric companies are receiving 150 applications pr day for micro PV Installations where you can use the grid as a battery.

Guess we can't compete with child slave labor

[ourlovecanlastforeve]

We can't offer lower prices on a superior product because our laborers have frivolous things like "health care" and "vacations" and "eight hour work days."

Choices

[pubwvj]

Hmm... I would rather they subsidize solar electric than petroleum.

Tariffs and protectionism explained - youtube

[Leafwiz]

Teacher of Economics explains how tariffs work, and how it might backfire on the country which imposes it.

http://www.youtube.com/watch?v=dSQTbd2iJtY

To sum up, tariffs make the economy, which imposes it, loose money in total.

Re:Tariffs and protectionism explained - youtube

[shutdown -p now]

Tariffs make large transnational corporations lose money in total. For GDP purposes and such, that money is counted for in your country. But, since it's all conveniently reported as income in some tax haven with zero real production done, you don't actually see any taxes on it. So all that wealth ends up in the pockets of the owners, not your pockets or those of the majority of citizens. So you won't lose money in total.

Re:Tariffs and protectionism explained - youtube

[Leafwiz]

The goods get more expensive for the people in the country. So they have to spend more money. Money they could have spent on something else. The tax goes back to society (through less efficient government programs) . What tips the scale is the dead-weight loss which is the value of wasted resources devoted to expanded domestic consumption and expenditures devoted to less desired substitutes brought about by the tariff.[1].

[1] http://wiki.answers.com/Q/What_is_the_deadweight_loss_of_a_tariff

Or in other words

"If we look at the national market graph, we can see why these are deadweight losses. The consumption effect of the tariff is the loss of consumer surplus for those consumers who are squeezed out of the market because the tariff "artificially" raises the domestic price, even though foreigners remain willing to sell products to the importing country at the lower world price. The production effect of the tariff is the loss from using high-cost domestic production to replace lower-cost imports (available to the country at the unchanged world price). The high production cost is shown by the height of the supply curve, for each of the extra units produced because of the tariff."

http://www.wright.edu/~tdung/Chapter7_Pugel.htm

In short, poor people are left out , due to the higher price.
Extra resources are wasted due to higher production costs. Which could have been spend on other activities.

Re:Tariffs and protectionism explained - youtube

[shutdown -p now]

This analysis disregards one very important thing: when people buy more expensive local goods, that means that the salaries of local workers producing those goods also rise (and/or there are more of them - so fewer people without a job). So poor people being left out is offset by there being fewer poor people.

Re:Tariffs and protectionism explained - youtube

[Leafwiz]

Another ones gain, is some other ones loss. Person A get 2+ in salary. Person B gets -2 in his balance. Where person B could have used the -2 resources to grow his business. (To create more jobs) Maybe person A used his +2 to buy something from Person B. But that just leaves them in total of 0.

So another bad thing about tariffs; they force money away from the competitive business to the uncompetitive. Also you risk other countries to put tariffs on our own goods, which might cost you further jobs.

Re:Tariffs and protectionism explained - youtube

[shutdown -p now]

Another ones gain, is some other ones loss. Person A get 2+ in salary. Person B gets -2 in his balance. Where person B could have used the -2 resources to grow his business. (To create more jobs) Maybe person A used his +2 to buy something from Person B. But that just leaves them in total of 0.

Yes, there is no gain. The "gain" is that the average quality of life remains the same. Whereas without tariffs, it evens out - which means that countries with lower standard get theirs higher, and countries with higher standard get theirs lower. In particular, the labor standards - the difference in which is the primary reason for the difference in cost of labor - also get evened out. Welcome back to the Gilded Age.

In fact, it's even worse than that, because the market is not free for the labor due to borders - workers can't move around to shop for better wages.

So another bad thing about tariffs; they force money away from the competitive business to the uncompetitive.

Inside the country, tariffs don't do such thing. On the international market, it's broadly true, if you define "competitive" as "lower prices at any cost". But that is only a good thing if you believe that any cost is justified.

Also you risk other countries to put tariffs on our own goods, which might cost you further jobs.

Sure, that's why you don't put tariffs on all foreign goods; only on those where not doing that is detrimental for your own society. There's no reason why US can't trade freely with Canada or Germany, for example.

Re:Tariffs and protectionism explained - youtube

[shutdown -p now]

We are not talking about paintings and books here. China is not "better" at manufacturing at all the stuff that is done there - it can all be done in US and Europe just as well; in fact, Chinese productivity is lower. They're only better at making it cheap, and that is only possible by abusing their workforce in a way that we would never condone. If we accept that and buy their goods indiscriminately, the only thing that it'll do is bring our own labor standards down to their level (because that's the only way we can compete on labor).

Not really

[koan]

though critics said the decision may end up raising prices and hurting the U.S. renewable energy industry

Only from corporations with the "take advantage" business model, possibly price fixing as well but the manufacture with some foresight can short sell them.

Re:The Most Ridiculous Correction Ever

[Arker]

Under what laws?

Under the ancient common law principles of tort, which are valid law in any common law jurisdiction until and unless superceded by statute.

Who makes these laws?

Common law torts originate so far back in time that it's difficult or impossible to precisely specify their origin. In this case we are talking about the tort of Nuisance which has been a recognised cause of action for a millenium or more.

Who determines the damages?

A judge or jury, after hearing testimony from both sides.

Who passes legislation that adjusts these laws when new forms of pollution come into existence?

That is one of the beautiful things about common law. No one needs to do that. The same principles apply to any instance of the tort, and the court simply applies them to the case at hand.

If Real Wars Were Like Trade Wars

[maest]

If governments fought real wars like they fight trade wars, here’s how the transcript of the communiqués between the leaders of two warring nations would read:

Leader of Absurditopia (A): I say, leader of Stupidia – we demand that you stop occupying that contested strip of land. If you refuse, we’ll have no choice but to shoot our own citizens.

Leader of Stupidia (S): You don’t scare us! That land is ours. And if you do kill some of your own people, make no mistake that we will immediately – and just as cruelly – commence to killing our own people. Courage is our national motto!

(A): Ha! You’re bluffing. But I’m not. I’ve just courageously ordered my troops to mow down in cold blood ten percent of my fellow countrymen. Take that!

(S): How dare you attack you like that! You leave us no choice but to attack us. I am ordering the Stupidian army to slaughter 15 percent of innocent Stupidians here in Stupidia. How do you like them apples?!

(A): You are cruel and inhuman to damage us by killing your people. I hereby instruct all of my fellow Absurditopians to commit suicide! Only then will you nasty Stupidians get your proper comeuppance and we Absurditopians the justice that we are due!

(S): You can’t beat us, you Absurditopian you! Listen up. I’m ordering all of my fellow citizens – Stupidians all! – to commit suicide. We’ll see who emerges victorious!
---
Then a long, long silence.

-from http://cafehayek.com/2010/10/if-trade-wars-were-like-real-wars.html

A Good Begining

[LifesABeach]

How about the 10 million engineers that India flooded the market with? When is the U.S.Government going to acknowledge that a major loss of revenue is the loss of taxes because of Services Flooding?

Double standards

[WaffleMonster]

I'm having trouble parsing the difference between subsidy and dumping when the effective outcomes are the same.

Rather than taxing what are really awesome low cost chinese solar panels...I would much rather see US subsidies to enable effective competition with chinese market to further push down costs and improve quality and effeciency. The US may have higher labor costs but this is only temporary Chinese costs are rising and cheap labor is already fleeing China. We offset this the way we always do... by working smarter rather than harder..with more automation and technology vs sweat shops.

There are practical limits and maybe the US is justified in its actions...yet I just can't shake the feeling at the core the real issue is we're a bunch of pathetic loosers crying foul.

When foreign farmers are put at a disadvantage by US AG subsidies where is the US concern over the negative consequences of US government interference in the "free market".

Solyndra? Ha, ha, ha...

[bradley13]

Solyndra was never competitive. While the government through money at it, notice that the private capital markets knew better. The government only invests in businesses that are so poorly run that no one else will touch them. Oh, and businesses that make large political donations.

This is just sour grapes. Solyndra couldn't compete, even receiving subsidies on both ends of every sale. The Obamanoids are embarrassed, so they impose tariffs on a country that is making it work.

What a pathetic rebuttal

[A nonymous Coward]

Try some actual, you know, *ideas* next time, some arguments.

And knowing Wallmart...

[publiclurker]

They've lowered the price of junk food at the same time.

Please tell me you're joking...

[publiclurker]

Who in their right mind would try to start up a capital intensive thing like making solar cells when they know that the government that pushed the last group out of business is still there and even more capable of doing it again.

Who benefits?

[Livius]

Perhaps "hurting the U.S. renewable energy industry" is the goal.

economics 101

[0111 1110]

Is this tariff the equivalent of a regressive tax that only hurts lower income Americans? Is this a transfer of wealth from lower income people to higher income people? Yes and Yes. It is taxing the poor to increase the income of a handful of rich people. And maybe add a few more low income jobs in the few areas where solar panels are made. But who cares about poor people? Clearly not the Democrats and Republicans in favor of this tariff who are like an anti Robin Hood stealing from a large number of relatively poor people and giving to a handful of rich people. Since we are increasing the profits of corporations at the expense of lower income people this tariff is also consistent with our current slide into fascism. A nice little agreement between a government and a corporation, both of which hope to gain. I have to wonder whether the Democrats in favor of this realize that the alleged benefit to lower income people depends entirely on the theory of trickle down economics..

Will this tariff increase the income of US solar panel manufacturers? Maybe, but for that to even be a possibility the tariff must be sufficiently high that it makes US solar panels cheaper than foreign ones. Whether eliminating foreign competition while drastically increasing the price of a solar panels will raise the income of US solar panel manufacturers is questionable at best. The laws of supply and demand still hold. Higher prices will result in fewer installed solar panels in the US. Much higher prices will result in a drastic reduction in new solar panel installations. This is just basic economics. Nevertheless cutting out Chinese competition completely may result in higher profits for the rich solar panel company owners.

With a high enough tariff you might make your product cheaper than the the foreign product and basically end all foreign sales, but you can't force people to actually buy American solar panels. Poor people already cannot afford even Chinese solar panels. This will reduce the number of middle class Americans who can afford them. Perhaps significantly. If solar power was beyond the means of the bottom 25% it will now be beyond the means of some higher percentage of Americans. I don't know what the new percentage will be, but it will be higher than it is now. Keep in mind also that there are far more lower middle class people in the US than higher income people. So the reduction in solar panel installations may not be linear. By raising the US price by, say, 250% you might have a reduction in new solar panel installations of 400%. Without having to worry about foreign competition the US panel manufacturers may well actually be able to raise their current prices significantly. Before they were stuck with tight margins to at least attempt to make the price gap between themselves and the Chinese suppliers as small as possible. Now that they have a captive audience they may raise their prices almost to the point where they are only slightly less expensive than the new Chinese + tariff price. There's a ceiling on how much they can do this because if the difference between the Chinese and US panels is small enough the Chinese would almost certainly drop their price to match or beat it, but they might have a bit of wiggle room. 250% is a lot.

If you consider yourself part of the Green movement this reduction in the number of solar panel isntallations is obviously a bad thing. It means more combustion and more CO2 than you would otherwise have. So while the owners of US solar panel manufacturers might be able to buy that new Ferrari they've been pining over or maybe another ocean front home to add to their collection, and maybe hire a few more minimum wage workers, it's at the expense of, if you are an AGW believer, helping to eventually destroy all mammalian life on the planet, including humans. So new exotic cars for a few already rich Americans in exchange for pushing forward the extinction of our species by some number of years. Sounds lik