President Biden wants more American cars and trucks to run on electricity, not gas. His administration has pushed that goal on several fronts, including tough new auto emissions regulations and generous new subsidies to help American consumers save up to $7,500 on the price of a new electric vehicle.
Mr. Biden’s aides agree that electric vehicles — which cost more than $53,000 on average in the United States — would sell even faster here if they were cheaper. As it turns out, we’re seeing a wave of new electric vehicles that are significantly cheaper than what customers can currently buy in the United States. They are proving extremely popular in Europe.
But the president and his team don’t want Americans buying these cheap cars, sold elsewhere for as little as $10,000, because they’re made in China. This is true even though a wave of low-cost imported electric vehicles could help lower car prices overall, helping Mr. Biden in his re-election campaign at a time when inflation remains the top economic concern voters.
Instead, the president is taking steps to make Chinese electric vehicles prohibitively expensive, largely to protect American automakers. Mr. Biden signed an executive order earlier this month that quadruples the tariffs on these cars to 100%.
These tariffs will put many potential Chinese imports at a significant cost disadvantage compared to U.S.-made electric vehicles. But some models, like the discounted BYD Seagull, could still cost less than some U.S. competitors even after tariffs, which is one reason why Sen. Sherrod Brown of Ohio and Other Democrats have called on Mr. Biden to completely ban Chinese imports of electric vehicles.
The apparent conflict between climate concerns and U.S. manufacturing has irked some liberal environmentalists and economists, who say the country and the world would be better off if Mr. Biden agreed to the importation of low-cost, low-emission technologies to fight against climate change.
Mr. Biden and his aides reject this criticism. They say the president’s efforts to restrict imports of Chinese electric cars and other clean technologies are an important countermeasure to illegal and harmful trade practices implemented by Beijing.
And they insist that Mr. Biden’s approach to trade will ultimately benefit American jobs and national security — as well as the planet.
Here are the policies and political considerations driving Mr. Biden’s attempt to protect American producers from Chinese competition.
Refuse Beijing a new monopoly
China already dominates key clean energy production in areas such as solar cells and batteries. Mr. Biden’s aides want to prevent him from acquiring monopolies in similar sectors, such as electric vehicles, for several reasons.
They include climate concerns. Administration officials say Chinese factories, which tend to be powered by fossil fuels like coal, produce more greenhouse gas emissions than U.S. factories.
There is also a central economic reason for denying China a monopoly: ensuring that electric cars and trucks will always be available, at competitive prices. The Covid-19 pandemic has exposed the fragility of global supply chains, as essential products like semiconductors have become difficult to obtain from China and other Asian countries that the United States has relied on . Prices of consumer electronics and other products reliant on imported materials have soared, fueling inflation.
Biden officials want to avoid a similar scenario for electric vehicles. Concentrating the supply of electric vehicles and other advanced green technologies in China would endanger “the world’s collective ability to access the technologies we need to succeed in a clean energy economy,” said Ali Zaidi, Mr. Biden’s national climate advisor.
Strengthening national security
Biden officials say they are not trying to bring the entire global electric vehicle supply chain to the United States. They strike deals with allies to supply minerals for advanced batteries, for example, and encourage countries in Europe and elsewhere to subsidize their own domestic production of clean technologies. But they are particularly worried about the security implications of a major rival like China dominating space.
The administration has opened investigations into risks related to software and hardware in future smart cars imported – electric or not – from China, which could track the location of Americans and report it to Beijing. Liberal economists also worry that China could cut off access to new cars, or key components of them, for strategic purposes.
Allowing China to dominate electric vehicle production risks repeating the long-standing economic and security challenges of gasoline-powered cars, said Elizabeth Pancotti, director of special initiatives at the liberal Roosevelt Institute in Washington, who praised the efforts of Mr. Biden’s industrial policy.
Americans have struggled for decades to cope with decisions by often hostile oil-producing countries, operating under the OPEC cartel, to cut production and raise gasoline prices. China could wreak similar havoc on the electric car market if it drove other countries out of the sector, she said.
If that happens, she said, “reversing this trend will be very difficult.”
Biden needs the energy transition to create jobs
There is no denying that politics also plays a major role in Mr. Biden’s decisions. Simply put: He promises that his climate agenda will create jobs — well-paying, blue-collar manufacturing jobs, including in key states like Pennsylvania and Michigan.
Mr. Biden is a strong supporter of the labor movement and is counting on union votes to help him win these states. He promised that the energy transition would boost unionized workers. He’s betting that their support for tariffs meant to protect U.S. manufacturing jobs will overshadow complaints from environmentalists who want faster progress on reducing emissions.
“One of the constituent groups of the Democratic Party that is really highly organized and gets people knocking on doors is the labor movement, even more so than the environmental movement,” said Todd Vachon, a social studies professor at the Rutgers University and the author of “Clean Air and Good Jobs: American Labor and the Fight for Climate Justice.”
These concerns are particularly important given that many jobs in the clean energy sector go to young companies where workers are not unionized, he added.
Mr. Biden brought these concerns to the forefront when he announced his tariff decision last week.
“In 2000, when cheap steel from China began flooding the market, U.S. steel towns in Pennsylvania and Ohio were hit hard,” he said at the White House. “Steelworkers and steelworkers in Pennsylvania and Ohio lost their jobs. I’m not going to let this happen again.
David Gelles contributed reporting from New York.
News Source : www.nytimes.com
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