A new tariff on Chinese-made wind towers will not aid domestic industry. In fact, it is likely to do the opposite.
How very 1992.
Yesterday the Commerce Department decided to put a 13 to 26 percent tariff on Chinese made wind towers -- as punishment for "dumping" the towers in the American market at a price that may be less than cost. This follows the recent preliminary recommendation of a 31-to 250 percent tariff on Chinese-made solar cells because the Chinese government subsidizes the industry. Last week, the Chinese government filed a complaint against the U.S. for imposing the tariffs with the WTO, and so we're off to the races on a greentech trade war that feels awfully retro.
The Commerce Department's recent decisions are an attempt to return to a simpler past, rather than building a fairer future. Tariffs are not going reverse time so that the U.S. has the 27 percent share of the global solar manufacturing market that it had in 2001 -- instead of 2010's 5 percent share. Nor will the tariffs create jobs here or hasten the installation of green technologies. In fact, it is likely to do the opposite: Higher prices will dampen the installation of solar and wind here, causing layoffs in the solar and wind installation industry and rolling back the progress these green industries have made. Imposing tariffs will certainly not increase American government subsidies so that they can compete with China's.