The American government, which has been shoveling out federally guaranteed loans to American solar power companies, is now going to try to help by taxing the companies' foreign competitors, the Wall Street Journal reports:
U.S. trade officials slapped modest tariffs on imports of Chinese solar panels, giving a partial victory to solar-equipment manufacturers in the U.S. but stopping short of harsh duties that could spark a trade war....the Commerce Department announced preliminary duties of between 2.9% and 4.73% on Chinese solar cells and solar panels.
My bet is if the American government decided to impose a new 4.73% federal tax on Wall Street Journal subscriptions, or Wall Street Journal advertising, the word that the newspaper used to describe it in a news article wouldn't be "modest," but outrageous.
It's bad enough in the first place that the American taxpayers are subsidizing domestic alternative energy companies through these Department of Energy loan guarantees. Now we're also going to impose protectionist tariffs to shield them from foreign competition?
There's already a 30% federal tax credit in place for the costs of residential solar installations, so, for consumers who use Chinese-made solar cells or panels, it looks like the American federal government will wind up paying 30% of the new tariff itself. One of the reasons often given for encouraging alternative energy, reducing carbon dioxide emissions and the attendant supposed global climate change, applies whether the solar panels are made in America or in China.
If the American government is worried about Chinese government-backed companies undercutting American companies in manufacturing, taxing American consumers seems like a bit of a self-defeating way of approaching the problem. An alternative approach might be to to support free labor unions in China and political change there that would reduce government involvement in the economy.