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Is It Bad If China Subsidizes Production Of Solar Panels?

Firms with U.S.-based solar panel manufacturing facilities, led by the German company SolarWorld, have filed a complaint alleging that China unduly subsidizes Chinese solar panel manufacturing. This kind of thing, as Sarah Laskow argues, wreaks havoc on progressive coalition politics which are built around a “green jobs” labor/enviro alliance. But it’s not actually clear what the aggregate jobs impact of this would be:

Last year, about 47 percent of solar jobs were in installation, about twice as many as in manufacturing. Installation jobs are also growing more quickly, in large part because cheaper solar panels have made solar power a more attractive investment for homeowners and businesses. The solar industry is divided over the trade complaint, as well: Executives who sell silicon and solar panel manufacturing equipment to Chinese companies are worried the complaint could harm the industry as a whole.

I do think it’s always helpful to try to take a “real resources” viewpoint on these things. What’s at issue here, basically, is that China is trying to give us a bunch of free solar panels. It’s quite true that insofar as we’ve been organizing economic activity around the (reasonable) assumption that China won’t give us a bunch of free solar panels, that getting the free panels will cause some dislocations. But it seems implausible that the best possible way of dealing with the situation is to refuse to accept the panels. That (poor) China has chosen to boost domestic employment by subsidizing consumption in (rich) America is slightly bizarre, but we may as well try to enjoy it while it lasts.

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