A Stupid Move on Solar

That title is pretty uncharitable on my part. Jillian Kay Melchior is even more uncharitable, but she sums up my feelings pretty well upon news that the Obama Administration is slapping tariffs on imported Chinese solar panels:

The federal government last week approved a hypocritical trade measure that not only undermines the president’s environmental goals but also increases costs for U.S. consumers.

Most Chinese solar panels will now be subject to tariffs of about 24 to 36 percent, the U.S. International Trade Commission unanimously decided this week. They were responding to an anti-dumping suit filed by German-owned solar-panel manufacturer SolarWorld, alongside six American manufacturers, many of whom opted to remain anonymous.

These panel manufacturers have every reason to be secretive. In protecting their own products from cheaper Chinese panels “dumped” into the U.S. market, they’re screwing over other segments of the U.S. solar industry, including solar-panel installers and companies that use panels as an input for electronic products and will now have to cope with higher prices caused by the tariffs.

Moreover, the tariffs undermine the president’s green agenda. If the U.S. really wants to increase its reliance on alternative energy, as Obama has so often claimed, the uncompetitive domestic solar market could use all the cost-cutting help Beijing can provide.

An unfortunate but not unexpected outcome of last week’s election. There has been a lot of grumbling in the circles President Obama travels about the Chinese dumping cheap solar panels. I had guessed it was only a matter of time before we hit back. I view these trade/protectionist policies as both intellectually silly and economically harmful. Given all the subsidies we’re dumping onto our own solar industries – often with little to show for it – I can’t wrap my mind around punishing the Chinese for doing the same. Especially when the Chinese are providing a product we need at a price we can actually afford.

To be all fair and balanced, here’s Senator Ron Wyden’s (D-OR) complaint in favor of hitting the Chinese. After all, I’m not an expert in global trade. My concern lies in moving the U.S. toward a solar future, and so far, I’m not real impressed with what’s coming out of Washington, D.C. If the Chinese are subsidizing their solar manufacturers to our benefit, well, let’s accept that and see what we need to do domestically to make our manufacturers competitive with the Chinese. Let’s not, of all things, start a trade war that results in escalating prices for solar panels. That’s definitely a move in the wrong direction.

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