Monday, July 2, 2012

A Trade Story IPE Folks Should Love

. Monday, July 2, 2012

This NY Times article is over a month old now, but I'm highlighting it anyway because it is illustrative of trade politics dynamics that we often emphasize in IPE. It would make a good case study for an introductory class. Here's the issue:

The United States on Thursday announced the imposition of antidumping tariffs of more than 31 percent on solar panels from China.
Here's the ostensible policy process:
The American decision was made by civil servants in a quasi-judicial process that is heavily insulated by law from political interference and does not represent a deliberate attempt by the Obama administration to confront China on trade policy. But that distinction has been largely lost in China, where the solar panel issue has been one of many causes embraced online by the country’s vociferous ultranationalists, who put heavy pressure on Chinese officials to respond forcefully to perceived snubs to China.
Here's the materialist policy process:
SolarWorld Industries America, which led the coalition of manufacturers that filed the solar dumping case, welcomed the department’s ruling. The decision “is a very positive step in the process. It’s also in line with what we expected,” said Ben Santarris, a company spokesman. “We consider this a bellwether case. It underscores the importance of manufacturing to the U.S. economy.”
Here's the opposing domestic force:
Many solar panel installers in the United States have opposed tariffs on Chinese panels, contending that inexpensive imports have helped spur many homeowners and businesses to put solar panels on their rooftops. The new tariffs are likely to mean a substantial increase in the price of solar panels here.
Here's the opposing foreign force:
“This is really a surprise,” he said in a telephone interview. “It’s really dangerous.” Mr. Li said that Chinese companies would “certainly” retaliate by filing a trade case at China’s commerce ministry accusing big American chemical companies of dumping polysilicon, the main ingredient in solar panels, on the Chinese market.
Here's the supporting ideational force:
“China’s method is straightforward: it sets forth industry-specific Five-Year Plans and then uses all forms of national and local subsidies and other governmental support to quickly transfer jobs, supply chains, intellectual property and wealth, to the permanent detriment of U.S. and global manufacturers,” he said. “China’s ability to ramp up and overwhelm an industry is unique and particularly devastating with new and emerging technologies, where global competitors may be less established and can be knocked out more easily and quickly.”
Here's the opposing ideational force:
Chinese officials have been indignant at American criticism of their solar power industry, pointing out that the United States has urged China for years to embrace renewable energy as a way to reduce air pollution, combat climate change and limit the need for oil imports from politically volatile countries in the Mideast.
There's more good stuff at the link, including a bit of historical context. Pedagogically speaking, it would be nice if this ends up being settled at the WTO. Then we could bring in all of interests, ideas, and institutions into one nice, compact little story.


A Trade Story IPE Folks Should Love




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