Trump Starts His Trade War - WSJ Editorial
Can Donald Trump stand prosperity? Fresh from a government shutdown victory and with the U.S. economy on a roll, the President decided on Tuesday to kick off his long-promised war on importsand American consumers. This isnt likely to go the way Mr. Trump imagines.
Our action today helps to create jobs in America for Americans, Mr. Trump declared as he imposed tariffs on solar cells and washing machines. Youre going to have a lot of plants built in the United States that were thinking of coming, but they would never have come unless we did this.
The scary part is he really seems to believe this. And toward that end he imposed a new 30% tariff on crystalline silicon photovoltaic cells and solar modules to benefit two bankrupt companies, and a new 20%-50% tariff on washing machines to benefit Whirlpool Corp. The tariffs will hurt many more companies and people, and thats before other countries retaliate.
The solar tariff is a response to a petition filed at the International Trade Commission by two U.S.-based manufacturersChinese-owned Suniva, which filed for bankruptcy last year, and German-owned SolarWorld Americas, whose parent company filed for bankruptcy last year. Under Section 201 of U.S. trade law, the companies dont need to show evidence of dumping or foreign subsidies. They merely have to show they were hurt by imports, which is to say by competition.
The two companies once employed some 3,200 Americans. But the wider solar industry, which depends on price-competitive cells as a basic component, supports some 260,000 U.S. jobs. Costs will rise immediately for this value-added part of the industry, which the Solar Energy Industries Association (SEIA) says includes the manufacture of metal racking, high tech inverters, machines that improve solar output by tracking the sun and other electrical products.
The Journal reported Tuesday that the Trump tariff may spur an unnamed panel manufacturer to invest in a new plant in Florida that will create 800 new jobs. But SEIA says it expects that the tariff will cost 23,000 U.S. jobs this year alone. It will also mean that billions of dollars of solar investments are likely to be postponed or canceled. Utility companies facing green-energy mandates from state governments will also suffer as it gets more costly to deliver solar-produced electricity.
Mr. Trump will also make doing the laundry great again, or at least more expensive, with a new 20% tariff on the first 1.2 million imported washing machines every year. Above that the tariff will go to 50%. Dont even think about assembling a washer with foreign parts, which get whacked with a 50% tariff above 50,000 imported units in the first year.
(snip)
Mr. Trump conducts trade policy as if U.S. trading partners have no recourse. With exports of $30.9 billion in 2016 and among the countrys highest level of exports per capita, South Carolina knows better. By justifying tariffs solely on the failure to compete, Mr. Trump is inviting other countries to do the same for their struggling companies. Their case at the World Trade Organization will also be a layup, allowing legal retaliation against U.S. exports.
By the way, if Mr. Trump thinks these new border taxes will hurt China, hes mistaken again. China ran a distant fourth as a producer of solar cell and modules for the U.S. in 2017, after Malaysia, South Korea and Vietnam. Korea and Mexico are the two largest exporters of washing machines to the U.S. Mr. Trumps tariffs are an economic blunderbuss that will hit Americas friends abroad and Mr. Trumps forgotten men and women at home.
https://www.wsj.com/articles/trump-starts-his-trade-war-1516755083
Hoyt
(54,770 posts)Doodley
(9,094 posts)wall.
SHRED
(28,136 posts)Wow
question everything
(47,487 posts)Obviously, they'd rather have him than any Democrat, but they often hold their nose. Another issue that they strongly disagree is immigration. They firmly believe that we need immigration for growth.
Hortensis
(58,785 posts)Imagining Trump saying "photovoltaic cells,"... Can't at all actually. Vandals in the candy store time.
But a technical term reminds me of when he was given a lengthy tour of new multibillion-dollar electromagnetic catapult technology being developed by the Navy and left the aircraft carrier vaguely calling it "digital" and just as clueless as before he boarded.
It sounded bad to me. Digital. They have digital. What is digital? And its very complicated, you have to be Albert Einstein to figure it out. And I saidand now they want to buy more aircraft carriers. I said, What system are you going to be Sir, were staying with digital. I said, No youre not. You going to goddamned steam, the digital costs hundreds of millions of dollars more money and its no good.
mahatmakanejeeves
(57,489 posts)Hortensis
(58,785 posts)Fire and magnificent plumes of black smoke heralding his arrival sound like something he'd like even more than "steam."
roscoeroscoe
(1,370 posts)Just trashing the buffet, for fun.