'Bring Me Some Tariffs'?

Real Clear Policy

9/18/17

Throughout the 2016 presidential campaign, then-candidate Trump promised a bold new trade agenda for the United States. But other than withdrawing the United States from the Trans-Pacific Partnership, the Trump administration has thus far avoided shaking up the international economic order.

Apparently frustrated by this lack of tangible trade “victories” early in his administration, President Trump reportedly told senior advisers: “I want tariffs. Bring me some tariffs.” Regrettably, he may soon have an opportunity to impose steep tariffs and reward his supporters in the coal industry.

In April, two bankrupt solar firms, Suniva and SolarWorld, filed a petition at the International Trade Commission, relying on a rarely used U.S. trade law. They argued that an increase in imported solar cells is a “substantial cause” of “serious injury” to the domestic industry. In their request for protection from foreign competition, the firms proposed initial duties on solar cells of $0.40 per watt and an initial minimum price of $0.78 per solar module, both of which would decline over a period of four years.

This case is unlike standard antidumping or countervailing duty cases, which target “unfair” trade practices and typically apply tariffs or other restrictions to imports from a particular country or company. The trade remedy sought by the petitioners — known as a “safeguard” — would apply to fairly traded imports from all countries. And it would essentially double the cost of solar products. This would make solar products in the United States more expensive than virtually anywhere else in the world.

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