Donald Trump abused his national security power by imposing tariffs on steel and aluminum imports to support domestic producers. Now President Biden is stealing from his predecessor’s industrial policy guide by invoking the Defense Production Act to promote domestic green energy. Don’t laugh – the White House wants to build solar panels and heat pumps to stop Vladimir Putin.
In rare good news, the President on Monday breathed a sigh of relief from US solar energy developers by announcing that he would levy no tariffs on imported solar panels from Southeast Asia for two years. Domestic manufacturers say their Chinese competitors are dodging anti-dumping tariffs, and a Commerce Department probe threatened to hike the cost of solar projects where US firms add value.
Mr. Biden’s tariff deferral is good news for consumers, although the commerce probe is continuing so he can maintain the fiction that it’s not politically influenced. Most dumping investigations are. This was egged on by Congressional Democrats, particularly Ohio Senator Sherrod Brown and Rep. Tim Ryan.
Solar panels became commodities when the Chinese discovered how to make them more cheaply. Cheap imports have helped boost US solar production, but they also create a political and economic paradox for Democrats that Mr. Biden is now trying to resolve.
Liberals promise green energy will create hundreds of thousands of manufacturing jobs to replace those killed by their war on fossil fuels. However, many of these jobs will be in countries with lower labor and energy costs. So Mr. Biden is turning to the Defense Production Act to boost domestic companies.
This Cold War-era law gives the president sweeping emergency powers to mobilize domestic manufacturers to make goods he deems critical to national security. Mr. Biden ironically claims that the energy problems caused by the left’s climate policies are a national emergency that requires a command-and-control solution. Increasing domestic production of solar panels, heat pumps, building insulation, fuel cells and power transformers can “reduce risks to our power grid,” says the White House.
The North American Electric Reliability Corporation recently warned that there could be power outages in the US this summer. Blame green energy subsidies that have forced the shutdown of fossil and nuclear generators that provide 24/7 base-load power. When you rely on electric heat pumps and solar panels, the grid becomes less reliable.
Mr Biden also says the DPA can help save Europe from Mr Putin’s energy blackmail. “With a stronger clean energy arsenal, the United States can be an even stronger partner for our allies, especially in the face of Putin’s war in Ukraine,” the White House says. But solar panels and heat pumps won’t keep Europeans warm this winter.
What Europe needs is more natural gas, and what the US needs is more pipelines and terminals to export it. But removing regulatory barriers to building that infrastructure isn’t part of the president’s executive order. Mr. Biden does not explain how he will use the DPA, but says he will “convene relevant industry, labor, environmental justice and other key stakeholders.”
One of those “stakeholders,” climate alarmist Bill McKibben, days after Putin invaded Ukraine, urged Mr. Biden to call the DPA to build green energy factories like FDR did to build weapons in World War II. Mr. McKibben wants the President to “encourage domestic manufacturers” and “procure and install equipment in private industrial plants to meet the necessary production targets.”
Let’s hope Mr. Biden doesn’t take over petrochemical plants to make solar panels, although that’s what some liberals have in mind. Five Democratic senators urged the president in March to use the DPA to “reflect the Lend-Lease Act program instituted during World War II by which the United States sent essential supplies to German-occupied Allied nations.” .
The DPA becomes Mr. Biden’s economic budget. The constitutional risk is that the president will increasingly resort to emergency powers to delegate private industry to do his political bidding. The economic risk is that the government will misallocate resources, making the US economy even less competitive.
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https://www.wsj.com/articles/joe-bidens-green-industrial-policy-defense-production-act-solar-panels-energy-tariffs-russia-china-11654546750 Biden’s Green-Energy Industrial Policy – WSJ