Retaliation and escalation in the U.S.-China solar trade war

And the entirely self-defeating and economy-shrinking trade war that comes from first heavily subsidizing your own domestic industries, and then imposing tariffs on foreign ones, rolls on.

President Obama has often complained about China ‘unfairly’ subsidizing their solar-panel industry and providing themselves with an unwarranted competitive advantage, and the Obama administration has even slapped tariffs on Chinese-made solar panels to supposedly ‘level the playing field.’

…Why it’s somehow ‘unfair’ when China subsidizes their domestic solar industry, but perfectly acceptable when we do it (and how), remains a mystery, especially since China has turned their own domestic solar industry into a hot mess of oversupply through the artificial market signals they willfully created and companies have lately been declaring bankruptcy right and left.

But stupid is as stupid does, and China has to try and save its flailing industry any way it can. Via Reuters:

China said on Monday that it would impose preliminary anti-subsidy duties on some imports of U.S. solar-grade polysilicon, a move that could intensify trade tensions between the world’s two largest economies.

China’s Commerce Ministry said it would hit U.S. imports of the material used to make solar panels with relatively low duties of up to 6.5 percent, amid trade frictions in the struggling global solar industry.

That follows the ministry’s much heftier anti-dumping duties – used for goods sold below market value – of 53.3 to 57 percent on U.S. polysilicon in July, a move which many saw as a bid to protect China’s struggling domestic industry. Washington called those duties disappointing.

According to its investigation, “subsidies exist and China’s polysilicon industry suffered substantial harm”, the ministry said in a statement on its website.

I can hardly wait to hear from the Obama administration about how this is “unfair,” “unacceptable,” “uncalled for,” blah blah blah, when they’re falling all over themselves to do the exact same thing.

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