Economists and some in the mainstream media are shrieking in horror at President Trump’s latest action of slapping imported solar products and even washing machines with, according to The New York Times, tariffs of up to 30 percent! This sounds ominous doesn’t it? The President should drop these restrictions immediately or he might start a trade war, right? Not exactly.
The threat of other countries retaliating against these special tariffs is real and by no means should the terrible effects of such levies be downplayed or ignored. However, if one observes how the President conducts himself and the actions of one of his predecessors, you get a better idea of what Trump maybe attempting to accomplish.
It is very likely that the President is using these import taxes as a means to push China into lowering more of its tariffs on imported goods from the US. For example, after Trump’s visit to Beijing, Reuters reported in early November of last year that China announced the country was lowering tariffs on imported products from the United States. It was done in light of the President’s continuous public complaints about China, including his threats to punish the country with punitive import taxes.
With these tariffs, the President can not only claim he is a man of his word but also demonstrate to our trading partners, especially China, that the US will follow through to protect its interests. The New York Times also adds more context to Trump’s latest policy too as the new import restrictions aren’t all they are cracked up to be.
Not only does the United States already restrict solar product imports from China, but the President’s tariffs will drop 15 percent in about four years. Additionally, The Times also states the first 2.5 gigawatts of imported solar cells will be exempted from the tariff. This, in turn, will enable US solar module manufacturers the ability to utilize inexpensive solar cell supplies for their products.
It should be noted that President Ronald Reagan also levied tariffs of up to 100% on imported products from Japan, respectfully. However, this policy was enacted when the President concluded the Japanese were not complying with an agreement on semi-conductor manufacturing that was signed by the two countries during July of 1986
Despite his free trade rhetoric, President Reagan did implement a number of trade restrictions on Japanese imports despite eliminating others. Overall, President Reagan’s record on free trade is mixed but this does not diminish his greatness anymore than Trump’s inconsistencies on trade diminish his. Reagan and Trump are both excellent examples of Presidents who promote(d) and defend(ed) America’s interests first and foremost.
Additionally, by singling out solar products, President Trump highlights a fraudulent, boondoggle industry that is probably on the verge of collapse anyway. In fact, manufacturing of solar power products involves much more pollution than extracting and refining fossil fuels. So much so that when The Washington Post published a story during 2008 exposing the high amount of polluting one Chinese manufacturer of solar panels conducted, the stock price of numerous solar producers sagged and the news story sent shock waves throughout the solar power industry.
Furthermore, many of the concerns raised about solar panels and other related products still have largely not been addressed. Worst of all, after nearly ten years and billions of dollars spent, the entire renewable energy market does not have enough capacity much less infrastructure to provide for our energy needs here in the US and other countries that use them.
It will be interesting and maybe sometime before it is known what policies China has that President Trump is singling out or the President’s true intent with these new protections. Ultimately, the President was elected on a platform and campaign promises to defend America. In a certain light, it can be said Trump’s import restrictions are an extension of that policy and its critics are defending trade with a murderous, savage Communist regime. For too long, China’s government has stolen American technology and ideas and has been lax in enforcing its intellectual property laws.
However, with all of this in mind and consumer prices of solar products dropping in recent years, Trump’s action helps highlight little reported facts about the solar power market and China’s theft of US knowledge despite claiming to be a trading partner. Hopefully, this will lead to reform not just of China’s trading practices but also renewable energy, specifically solar power. When it comes to solar energy, ultimately, environmentalists are the beneficiaries of the promotion and subsidizing of so-called renewable sources like solar power.