The battle over Solar Panel tariffs has heated up significantly since my Forbes piece of January 4th. In that post, I urged the Administration to consider the outrageous theft of American funded R&D when deciding what action to take in response to a unanimous finding by the U.S. International Trade Commission (ITC) that Chinese manufactures conspired to dump solar panels on the U.S. market. In this case, Chinese manufactures aren’t just stealing American jobs or driving U.S. firms into bankruptcy and then buying them, they are using our own research and development to do it. The fundamentals of solar cell and module technology were developed at U.S. institutions with a lot of American tax dollars. It’s easy for Chinese firms to manufacture and sell cheap because they have had virtually no development costs.
[Greg Autry | January 18, 2018 | Forbes]
President Trump clearly understands the problem and appears prepared to act decisively. In a Rueter’s interview this week Trump not only promised to make his decision “pretty soon.” He didn’t equivocate, forcibly stating, “You know, they dump ‘em – government-subsidized . . . then everybody goes out of business.” The only question now is exactly what should be done and how strong the President’s action will actually be. I am hoping that he will act as forcibly as President Reagan did with semiconductor and motorcycle dumping from Japan in the 1980s.
The petitioners in the 201 case, Solar World of Hillsboro, Oregon and Suniva of Norcross, Georgia, have suggested a fifty percent tariff on imports of solar PV cells and modules. I also encourage the President to take the very strongest action, not simply because the U.S. firms have indeed been victims of a clearly documented conspiracy but because failure to act at this time simply invites further predatory acts by the Chinese government and their firms.
The Chinese government methodically targets the global, strategic industries that they plan to dominate in their five-year plans. They then follow through with strong support for their domestic champions that has included massive industrial subsidies, espionage and propaganda. The current deplorable state of America’s solar industry – with nearly all of our firms either dead or offshoring their production to China – is in no conceivable way the outcome of a “free trade” regime. It is the result of a coordinated, mercantilist assault.
Ironically, China’s U.S. partner in crime, the solar installation lobby, actually argues that the current weakness of U.S. solar firms is an excuse not to support them; better to team up with the murder than come to the aid of a weak victim. They’ll also argue that covering America with Chinese made solar panels is an environmental good, while conveniently ignoring the true environmental nightmare, that is Chinese mining and manufacturing. Meanwhile many conservatives argue that the entire solar-electric future will never work out and therefore we might as well just let the Chinese own it; an ill-considered and unnecessary bet. Whether the U.S. Solar industry is salvageable, environmentally worthy or economically viable is not nearly as important as the fate of U.S. R&D capabilities and the jobs in our automotive and commercial aircraft industries which are now directly in the crosshairs of the Chinese Communist Party.
I strongly encourage President Trump to act forcefully in response to this egregious attack on the American worker and taxpayers. While trade is a wonderful mechanism for wealth creation, there has never been a case of trade abuse as blatantly transparent as this one. It is time to send an unmistakable message that America will not allow our engine of innovation to be used primarily as a tool for creating wealth and jobs in other nations. This could be Trump’s Reagan moment.
Greg Autry writes on space & innovation. He teaches entrepreneurship at the Lloyd Grief Center, USC. Twitter: https://twitter.com/GregWAutry Facebook: https://www.facebook.com/gregwautry