This week, however, Trump finally did impose tariffs on washing machines and solar panels. The former tariff was, I think, more about looking tough than about any kind of strategic objective.
The latter, however, fits in with an important part of this administrationâs general vision. For this is very much an administration of dirty old men.
About washing machines: The legal basis of the new tariff is a finding by the U.S. International Trade Commission that the industry has been injured by rising imports. The definition of âinjuryâ is a bit peculiar: The commission admitted that the domestic industry âdid not suffer a significant idling of productive facilities,â and that âthere has been no significant unemployment or underemployment.â Nonetheless, the commission argued that production and employment should have expanded more than it did given the economyâs growth between 2012 and 2016 (you know, the Obama-era boom Trump insisted was fake).
If this seems like a flimsy justification for an action that will significantly raise consumer prices, thatâs because it is. But Trump decided to do it anyway.
The solar panel tariff is more interesting, and more disturbing, because it will surely destroy many more jobs than it will create.
The fact is that the U.S. is largely out of the solar panel-producing business, and whatever the reasons for that absence, this policy wonât change it. Like the washing-machine tariff, the solar-panel tariff was imposed using whatâs known in trade policy circles as the âescape clauseâ â rules that allow temporary protection of industries suffering sudden disruption. The operative word here is âtemporaryâ; since weâre not talking about sustained protection, this tariff wonât induce any long-term investments and therefore wonât bring the U.S. solar panel industry back.
What it will do, however, is put a crimp in one of the U.S. economyâs big success stories, the rapid growth of renewable energy. And hereâs the thing: Everything we know about the Trump administration suggests that hurting renewables is actually a good thing from its point of view. As I said, this is an administration of dirty old men.
Over the past decade or so there has been a remarkable technological revolution in energy production. Part of that revolution has involved the rise of fracking, which has made natural gas cheap and abundant. But there have also been stunning reductions in the cost of solar and wind power.
Some people still think of these alternative energy sources as hippy-dippy stuff that canât survive without big government subsidies, but the reality is that theyâve become cost-competitive with conventional energy, and their cost is still falling fast. And they also employ a lot of people: Overall, there are around five times as many people working, in one way or another, for the solar energy sector as there are coal miners.
But solar gets no love from Trump officials, who desperately want the country to stay with dirty old power sources, especially coal. (Wait â when I called them dirty old men, did you think I was talking about payoffs to porn stars? Shame on you.) Theyâve even rewritten Energy Department reports in an attempt to make renewable energy look bad.
Theyâve tried to turn their preference for dirty energy into concrete policy, too. Last fall, Rick Perry, the energy secretary, tried to impose a rule that would in effect have forced electricity grids to subsidize coal and nuclear plants. The rule was shot down, but it showed what these guys want. From their point of view, destroying solar jobs is probably a good thing.
Why do Trump and company love dirty energy? Partly itâs about the money: whatâs good for the Koch brothers may not be good for America (or the world), but itâs good for Republican campaign finance. Partly itâs about blue-collar voters, who still imagine that Trump can bring back coal jobs. (In 2017 the coal industry added 500, thatâs right, 500 jobs. Thatâs 0.0003 percent of total U.S. employment.)
Itâs also partly about cultural nostalgia: Trump and others recall the heyday of fossil fuels as a golden age, forgetting how ghastly air and water pollution used to be. But I suspect that itâs also about a kind of machismo, a sense that real men donât soak up solar energy; they burn stuff instead.
Whatever the specific motivations, the administrationâs first significant trade policy move is stunningly boneheaded. You shouldnât even call it protectionism, since its direct effect will be to destroy far more jobs than it creates. Plus itâs bad for the environment. So much winning!
This article originally appeared in The New York Times.
PAUL KRUGMAN © 2018 The New York Times