U.S. Consumers Will Lose With Trump’s Tariffs
A mantra among conservatives is that the government should never intervene in markets to “choose winners and losers.” They need to tweet that principle to President Donald Trump, who foolishly defied broad markets Tuesday in behalf of a few favored interests. Trump ordered a 30 percent tariff on imported solar panels, mostly from China, and 20 percent on imported washing machines, mostly from South Korea. The administration acted at the request of two bankrupt U.S. solar panel manufacturers and Whirlpool, the Ohio-based appliance manufacturer. An exponential decline in solar panel prices has driven a rapid expansion of solar power in the United States, where it is the fastest-growing source of electricity. About 260,000 people work in the U.S. solar power industry but relatively few of them are in manufacturing, which is why most companies in the industry lobbied against the tariff. Most are engaged in network development, installation and other aspects of the industry. The tariff likely will help some domestic solar panel manufacturers, but it is certain to drive up prices and adversely affect the overall industry, costing rather than producing jobs. It will, however, help to preserve the use of fossil fuels for power generation, the underlying Trump priority. And the tariffs are certain to produce retaliatory measures by Japan and South Korea, adversely affecting companies and their workers in other industries. The section of the law under which Trump acted is meant to counteract illegal conduct by foreign countries and companies, rather than to gratuitously protect favored interests from competition. Whereas the president appears committed to selecting winners and losers industry by industry, U.S. consumers ultimately will lose.