President Obama: "Questionable Competitive Practices Coming Out of China"

SolarWorld has two good for the industry senators on their side also. Could be an interesting year ahead....

Our economy is suffering from the economic dislocation caused by globalization. While these changes are inevitable, China's trade practices are always based on a zero-sum economics policy where they win and their 'partners' lose.

The simple solution is to demand that China play by the same rules as everyone else. They were able to avoid it in the 1990s because the threat of losing access to their huge market made everyone fearful of demanding fair terms.

The reality of the global trade imbalance with China is that they don't intend to grant anybody fair access to their market. China is no longer a 'developing' nation. They are a global economic superpower with an explicit national policy of dominating global trade at the expense of their 'partners'.

Nonetheless, the Chinese still need our markets to sustain their growth. Where would they sell everything if not to us?

CASM is a great cause and a worthy fight. We should demand that our politicians join in. President Obama has put his toe in the water to court Oregon voters. Let's see what happens.

Ken Stadlin

I guess by now the US government has abandoned any pretense it can effectively compete. What specifically are the Chinese doing that is questionable? Are they daring to produce at lower costs? Are they daring to make reasonably quality products (admittedly with hiccups) offering greater value than the regulation bound, heavily taxed, and high cost US manufacturing? I was looking for substance in Obama's criticism of the questionable Chinese competitive practices and found none. All I have seen in contrast is US government diligence in imposing higher costs on its own manufacturers, whether through imposing misnamed "antidumping" customs duties, or creating yet more compliance complexity with continually increasing cost ineffective regulations. Cheers, Alex

Agree fully with Alex. We spend four decades since Nixon/Kissinger transferring the technical/industrial knowledge of U.S. industry to China to make them a world economic player, knowing full well they will become one. Then when they are able (with our DIRECT help) to produce high-quality renewable energy components at a third (or less) of the cost of comparable U.S.-produced products -- because of our overhead of higher labor costs, more substantial regulatory restrictions, and multi-level distribution costs, then we get angry at the CHINESE ??! THEY are the smart ones here; we ought to be getting angry at our OWN stupidity and DO something about it!!

As opposed to whining about the bad, bad Chinese government, criticize the US government for NOT offering "0%" interest loans to manufacturers - that is pretty much the only "bad" thing they do.

Obviously we have no qualms giving big banks such loans....

The Chinese are smart and figured out the best of both worlds - a central government setting long term goals / visions and a very capitalist manufacturing base fueled by and thriving on cultivated greed.

What exactly are we complaining about? Low cost? market forces doing their thing? Them beating us at our own game?

We still have the choice to become happy winners, but the direction Obama is taking us in, is rather that of a sore loser...

It is my understanding that Chinese Gov. uses General funds to subsidize the Solar Panels, so that we cant keep selling at a loss. I dont think the Chinese manufactures have a better way of Capitalistically making them. We as a Free Country can also not buy them? Charge a fee to import, Ban them al together?
What to do?

Hi Marcus: I am sure some Chinese manufacturing companies, that I know of, would love to have access to 0 interest. They do not. Excellent statement - "The Chinese are smart and figured out the best of both worlds - a central government setting long term goals / visions and a very capitalist manufacturing base fueled by and thriving on cultivated greed." Very consistent with what I am experiencing with them. We are also seeing another trend there. The central government is promoting added value domestic industries based on local feedstocks and utilities. Levying export taxes on commodities but not on added value products does help. An example is magnesium.

Cheers
Alex

Greg, if you refer to subsidies as omitting egregious and onerous regulations encompassing production, financial reporting, taxation, staffing and organizing the business (the current US model), your comment on the Chinese government subsidizing is correct. Please provide some evidence of their use of General Funds to fund solar panels.

Cheers
Alex

Maybe all this is why Kissinger has publicly made it known that he admires the Chinese model and thinks the U.S. ought to adopt it.

@ Alex,
I am sure not every manufacturer there has access to 0% interest money but certain big guys do. I was assured of this just last week in Dallas, at the SPI.

In any case, we are wasting our time trying to protect domestic manufacturers. Never works. Never has, never will.

Thanks Marcus. I raised that question as some customers feel they can squeeze us for longer payment terms without increasing prices for them. Longer terms cost us interest on our working capital. By us, I mean the Chinese manufacturer I am working with.

Cheers
Alex

Marcus

We still have the choice to become happy winners, but the direction Obama is taking us in, is rather that of a sore loser...


Please elaborate or explain your concept of "choice to become happy winners" What would be your preffered direction forward?
I'm intriged.
There are things we should of started doing thirty years ago.

IN this forum I would expect more details about the specifics of the case and the companies named. I don't know all the details, but I sure am disappointed by some people just taking bits and pieces to reinforce their previous positions. Yes, some companies have received 0% loans. But that alone does not assure a winner. Look at semi company SMIC in Shanghai - they have been a continuous disaster despite gov support. This case has to be evaluated on the specifics. Can someone out there help ?

@Gary,
Here is a thought - dish out money to the RE industry like there is no tomorrow. Tell the wing-nuts to pound sand when the next "Solyndra" fails - after all we spend that amount every given morning in the middle east to secure fossil fuels.

Stand up to the interests of the military industrial complex and build an "Energy Industrial Complex". Screw this ridiculous concept of religiously worshipping "free market forces". Give me one major industry that really is driven purely by free market forces (possibly restaurants I guess).....
And to be more specific, yes hand out 0% loans like confetti. Trillions. While a lot of this precious money will go to waste, I guarantee you this will yield more return than sinking it in the desert - which is what we are doing now.

Free our industry of this tree hugger/hippie stigma. Turn it into a matter of national security. After all America's energy independence will solve many, many security related problems.....

Well, yes, to be a good corporate supporter one must want govt favor for corporations, but the best overall incentive for the solar industry is market or consumer stimulation, not, not corporate stimulation. The recent and past evidence shows that profits, wherever they be gotten, are the corporate motivation, corrupt or otherwise. If the end user/purchaser is incentivised, the markets will sort out in a hurry.
If China makes things cheaper we will and must buy there. Otherwise it is simply a war of who can subsidise more, and of course, our government loves to have itself seem necessary to business success, when it's only basic purpose is to check on business, not subsidize it. We must realize we cannot have a corporate government as well as a civil one. The government is for the people, not for corporations. Even tho recent court rulings allow them to fund politicians and parties, that ruling does not say the politicians must do what the corporate entities want.
Obama wants to "make nice" to both sides as usual. No commitment here, and rightly so, I feel. It is just wet diapers needing changing. Our flag wavers say the Chinese are playing unfairly, yet here, corporations beg for the same game. If we really believe in free market movements, then we must incentivize those markets through solar energy production subsidy. even tho wall streeters don't favor it because they know full well that distributed energy is not within their profit stream control as "burn tec" is and subsidized by our corrupt government policy makers.
A national RES and SREC trading program would sort alot of this out in a hurry and at the same time put more needed money in the hands of more of consumers, where, again, the markets would sort out what is really needed.
Right now, even tho the USA has made many mistakes in policies, the best way forward is to wake up to honor world trade, because we in the USA currently have no idea of our own best interests.

Mr Steven Koonan, a worker for the U.S. government's energy department has some good ideas about solar in this country, the renewable that only accounts for 0.03% of the energy demand here. Spain, perhaps because of trade winds is up to 2% solar for it's energy needs. Are we to believe that everybody has the same interest at this point in the time as the U.S. does, just look at what's going on in California and then New Jersey. The energy demand will be caught up with a more robust transmission (grid) service. An American Scientist (May-June 2011) article, Global Energy: The Latest Infatuations,pg. 212-219, was found grand by this reader.