Howls of protest following President Donald Trump’s decision to slap tariffs on foreign-made washing machines and solar panels were predictable but baseless, a trade expert said Thursday on “The Laura Ingraham Show.”
University of Southern California professor Greg Autry, author “Death by China,” disputed cries that prices for appliances would skyrocket. LG Electronics, a South Korean company that makes washing machines, told retailers Wednesday that it would raise prices.
The Wall Street Journal reported that industry analysts expect the average hike would be about $50.
“When they threaten to raise prices, that’s nonsense,” Autry said. “They will get the prices that the market bears, because that’s the way a market economy works.”
The Trump administration announced Monday that it would impose a tariff of 20 percent on the first 1.2 million imported large residential washing machines in the first year and a 50 percent tariff on machines beyond that number. South Korea responded by filing a complaint with the World Trade Organization.
Autry said it is not surprising South Korea would complain.
“I admire countries like South Korea,” he said. “They do a good job of taking chunks out of our market and keeping their market 100 percent to themselves. We need to think the same way about America first the way they think about South Korea first.”
“The consumer will never notice this. Who will notice this, though, is the Chinese manufacturers who have been ripping us off.”
Autry said the story is the same with solar — an industry created by America that China basically stole. Solar tariffs will start with 30 percent levies on imported cells and fall to 15 percent over the next four years. Autry said the components affected by the tariffs are a small part of the cost of solar installation.
He estimated that the modules make up about 10 percent of the cost. So a 30 percent increase in the price — split between consumers and producers — would result in a small overall increase.
“You’re talking teeny single percentage increments in a product whose prices has fallen by order of magnitudes over the last decade,” he said. “The consumer will never notice this. Who will notice this, though, is the Chinese manufacturers who have been ripping us off.”
Critics have hammered Trump on the issue, however. Rep. Mark Sanford (R-S.C.) this week called the tariffs a mistake, pointing to a $380 million investment that South Korean company Samsung recently made in South Carolina. He added in a statement that 7,000 state residents work in the solar industry.
“If increasing tariffs were the road to prosperity, then a whole host of economically forgotten places around the world would be vibrant,” he stated. “They are not. Increased tariffs have proved themselves to sound great but set countries on a financial road to ruin. This is shortsighted and will cost American jobs.”
But Autry said Trump’s move is a reasonable response to unfair trade practices, not unlike a 40 percent tariff that President Barack Obama imposed on Chinese solar producers. He said Trump is merely following up on that, adjusting to target China’s new practice of shipping products through third-party countries to evade the penalties.
In the case of China, Autry said, the bad behavior goes far beyond traditional product dumping.
“In the solar case, the Chinese have strategically attacked this industry, taken the whole thing away in less than a decade … The military hacked into these companies and stole both their technical data and their financial documents,” he said.
Autry said the evidence of this is strong enough that the Justice Department under Obama indicted five Chinese military officers.
“This is a military attack on the U.S. economy,” he said. “It’s not just about product dumping. And it would be absolutely irresponsible for any president not to respond forcefully.”
Responding to Chinese billionaire Jack Ma’s warning not to use trade as a weapon, Autry said. “And I would respond back, 'Don’t use your military as a trade tool.'"
Last Modified: January 25, 2018, 6:41 pm