The tariffs imposed by the Trump administration are rearing their ugly heads, and the world of investments and finance is reacting in a negative way. Obviously, Trump wants our trading partners to know he has ultimate control over trade deals. He doesn’t like the deals that are currently keeping the global economy growing at more than three percent a year so he’s acting like a financial savior.
The new tariffs on foreign-made solar panels are creating a financial mess in that important industry. According to Reuters, U.S. companies that develop renewable energy products are canceling more than $2.5 billion in investments that would fund large installation projects. The tariff on solar panels is costing American workers thousands of jobs, according to a recent Reuters article.
The U.S. solar panel industry currently employs more than 250,000 people. Forty percent of those people work in the installation department, and according to the U.S. Energy Information Administration, twenty percent of those people are in the manufacturing sector.
The solar panel industry employs three times as many workers as the coal industry. Solar panels production has come a long way from the early days. The industry is making a huge impact on the renewable energy sector of the economy, but Mr. Trump is pulling the rug out from under the solar panel industry in an attempt to bring coal jobs back. Coal is, by all accounts, an inefficient way to produce energy in the 21st century. But obviously, Mr. Trump didn’t get that memo or message.
The 30 percent tariff on solar panels will be in effect for four years. The tariff will decrease by five percent every year, but the cost of installing panels during the tariff years will increase by at least 10 percent.
The solar panel tariff is a step back in the quest to make renewable energy the way to help protect the environment as well as create new jobs and investment opportunities. But domestic solar panel manufacturers are patting Trump on the back for implementing the tariffs. One of those companies, Solar World, thinks the tariffs will save 280 manufacturing jobs, and First Solar is planning to spend $800 million on new projects. Those projects will need 700 new workers in Florida and Ohio.
But Sun Power the company that purchased Solar World’s manufacturing plant thinks more than 250 jobs will go away in other departments because of the tariffs. Trump’s tariffs are not a financial or an environmental win for America. They are the start of a nasty trade war that will cost many Americans part of their financial security.