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Related: Editorials & Other Articles, Issue Forums, Alliance Forums, Region ForumsTrade War Looming as China Rebukes U.S. Support for Solar
Chinas allegation that renewable- energy subsidies in five U.S. states violate free-trade rules ratchets up a potentially costly trade war between the worlds two largest economies.
Its a long, slow escalation of trade and currency wars as we race to the bottom, said Theodore ONeill, an analyst with Wunderlich Securities Inc. of New York.
Programs supporting renewable power, including wind and solar, in Washington state, New Jersey, Massachusetts, Ohio and California, violate World Trade Organization policies and trade treaties, according to a preliminary finding of an investigation posted yesterday on the website of Chinas Ministry of Commerce. China filed a complaint today at the WTO over U.S. procedures for calculating anti-subsidy duties on imports.
Those announcements followed a preliminary decision by the U.S. Commerce Department last week to impose tariffs of as much as 250 percent on imports of Chinese solar cells. The agency said the units were being sold for less than the cost of production in an attempt to drive out domestic competition.
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http://www.bloomberg.com/news/2012-05-24/trade-war-seen-looming-as-china-rebukes-u-s-support-for-solar.html
Nuclear Unicorn
(19,497 posts)when computers were first coming on line. At first computers were huge -- impractically so -- and prohibitively expensive. But as they entered the mainstream economy of scale took over. Now computers can be had with greater value at equal or lesser value making them accessible.
A trade war at the point when renewables are about to go mainstream would be crippling. To drive up the cost would be to keep them out of the reach of the ordinary household. Without that economy of scale investments could be exhausted setting them back by decades.
This is horrible.
Lasher
(28,233 posts)They are also creating excess supply to further drive down prices artificially worldwide. They are trying to drive our domestic manufacturers out of business. We are reacting appropriately by levying import tariffs.
Nuclear Unicorn
(19,497 posts)But until it resolves the costs will be high and stunt broader market reach.
Lasher
(28,233 posts)China is not going to stop employing these predatory trade practices. Don't get me started on currency manipulation. We have been doing a pretty poor job of protecting our domestic manufacturing in general.
If we take no measures to thwart them, and if both Europe and India are to be equally complacent, the most logical outcome is a Chinese monopoly. They do not want to bankrupt competitors so that they can subsequently lower prices. They want to control the market so that they can raise prices with impunity. And with no real competition, they would not have an incentive to spend a lot of money to develop better products.
Nuclear Unicorn
(19,497 posts)Since you're obviously engaged on this issue: What do you think the chances are of China strangling the Rare Earths market in retaliation? I've read they're the #1 source for the materials needed in many green tech items as well as consumer electronics. That seems like they have us at a disadvantage.
Lasher
(28,233 posts)Seems I remember reading that they were trying to gain control of deposits in Australia. And of course you must be aware of these minerals that they have inside their own country.
Yep, that's another concern we share.
Zalatix
(8,994 posts)We're too dependent upon exports. We're asking for such things to happen to us.
TreasonousBastard
(43,049 posts)hitting them with a tariff, they're making threats...
It's just business as usual-- China isn't about to start a real trade war with their biggest customer who happens to owe them trillions.
Zalatix
(8,994 posts)Why do we keep letting the free traitors frame the argument and absolutely distort reality all in their favor?