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Trump’s Misguided Tariffs

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THE EDITORIAL BOARD
, New York Times
Trump’s Misguided Tariffs

President Donald Trump’s pledge during the presidential campaign to help manufacturing workers by reducing imports from China and other countries sounded half-baked. His administration’s decision Monday to impose import tariffs on solar energy cells and panels and on washing machines makes clear just how difficult it will be to deliver on that promise.

The move will most likely raise the price of solar panels and washing machines in coming years and yet may not even lead to many more jobs. That outcome might sound paradoxical, but analysts say it’s due to changes underway in both industries well before Trump took office.

Tariffs will not be high enough to create new manufacturing jobs because the cost of production in countries like Malaysia and South Korea will remain significantly lower than in the United States. Also, U.S. factories would probably be highly automated and require far fewer workers. Meanwhile, the higher tariffs — and thus higher prices — for solar cells and panels will reduce demand from residential customers, businesses and utilities. That will hurt U.S. businesses that install panels and produce equipment used in solar systems. The Solar Energy Industries Association estimates that the tariffs could cost that industry 23,000 jobs.

Whirlpool, which sells more washing machines in the United States than any other company, says that the Trump administration’s decision, which will apply tariffs to imports from most countries, will lead to the creation of 200 jobs at a factory in Ohio, in anticipation of increased sales. But foreign appliance manufacturers like Samsung and LG have already built or are building factories for washing machines in the United States. So any advantage Whirlpool might enjoy could fade away as a new Samsung factory in South Carolina and an LG factory under construction in Tennessee begin churning out machines, creating more competition.

The Trump administration imposed the tariffs in response to complaints by domestic manufacturers — Suniva and SolarWorld in the solar case and Whirlpool in the washing machine case — that competition from a surge of imports had hurt their businesses. The tariffs on solar products last four years starting at 30 percent, falling to 15 percent in the fourth year. Each year, the first 2.5 gigawatts of solar cells imported into the country will be exempt from the tariffs. The washing machine tariffs last three years and start at 20 percent on the first 1.2 million units and 50 percent for the rest, declining to 16 percent and 40 percent in the third year.

The tariffs, though, could have a domino effect. The Trump administration imposed them under a federal trade law that allows the president to protect, or “safeguard,” domestic industries hurt by imports. Other countries will very likely challenge these tariffs at the World Trade Organization and seek to impose retaliatory tariffs against U.S. exports.

Trump is hardly the first president to use tariffs to help domestic industries. Barack Obama and George W. Bush took similar actions to help the tire and steel businesses respectively. But those presidents also tried to strike trade agreements with other countries, with varying degrees of success.

Trump seems uninterested in the painstaking diplomacy and negotiation such agreements require. Just look at his threats in recent months to withdraw the United States from the 24-year-old North American Free Trade Agreement should Canada and Mexico not quickly agree to changes his administration is demanding.

The White House needs to put forward a coherent and convincing trade policy if Trump wants to do right by his working-class supporters. The current piecemeal approach is not working on behalf of U.S. consumers, nor is it likely to put anyone to work.

Pence’s Self-Serving Trip to Israel

As America’s most prominent evangelical, Vice President Mike Pence has courted conservative Christians on behalf of President Donald Trump and borne witness to Trump as a true “believer,” although some remain skeptical.

When Pence announced his first trip to the Middle East, he initially hoped to draw attention to the persecution of Christians in the region, as well as nudge Israelis and Palestinians toward peace.

Things didn’t go as planned.

Pence wrapped up the trip to Israel, Egypt and Jordan on Tuesday, having been rebuffed by top Christian leaders in those countries in protest over Trump’s decision last month to break with decades of U.S. policy and recognize Jerusalem as Israel’s capital.

It’s still mysterious just how Trump believes he has advanced the cause of peace, or fortified America’s standing in the world, with that decision. Its costs in terms of U.S. isolation, on the other hand, were evident throughout the trip. Pence also didn’t meet with Palestinian leader Mahmoud Abbas, who flew instead to Brussels to ask European leaders for protection from Trump’s bad decisions. Neither did Pence sit down with other Palestinian leaders, any Israeli-Arab citizens or Israeli opposition members.

During Pence’s stops in Amman and Cairo, King Abdullah II of Jordan and President Abdel-Fattah el-Sissi of Egypt criticized the Jerusalem decision (although secret tapes reported by The New York Times suggest the Egyptians acquiesced in Trump’s choice).

One place Pence did strike an enthusiastic chord was in Parliament in Israel, where a hard-line government is largely hostile to a two-state solution. Members interrupted him with standing ovations. His address was replete with biblical references to Jewish ties to the Holy Land. He referred to God’s promise to the Jews that “he would gather and bring you back to the land which your fathers possessed” and to “the Jewish people’s unbreakable bond to” Jerusalem.

Even more striking was what Pence didn’t say. He mostly chose to ignore Israelis’ shared history with the Palestinians, only reaffirming support for a two-state solution “if both sides agree.” Pence, who had urged Trump to recognize Jerusalem, also announced that the U.S. Embassy in Tel Aviv would move to Jerusalem by the end of 2019, sooner than expected.

He further played his political and religious cards by inviting West Bank settlers as his guests at the event. The contrast could not have been starker to Parliament’s Israeli-Arab members, who held up signs saying, “Jerusalem is the capital of Palestine.” They were forcibly removed by security as Pence began speaking.

For Israelis, the speech was “as ringing an endorsement of the Zionist enterprise as one could pray for” and evidence that Prime Minister Benjamin Netanyahu and Trump have “an unprecedented meeting of the minds,” wrote Chemi Shalev, a columnist for Haaretz. But for the Palestinians, he said, it was a “slap in the face.”

Yet another slap in the face. Although Trump insists he wants an Israeli-Palestinian peace deal, he has, unlike his predecessors, chosen to disqualify America as an honest broker. He has weakened the Palestinians by cutting millions of dollars in aid for health and education projects for Palestinian refugees and then fanned new tensions with his one-sided decision on Jerusalem. At the same time, the gulf between the United States and Europe, once close partners in the peace process, is growing. Such divisions only serve to make good outcomes harder to achieve.

Pence’s trip, especially his speech to Parliament, satisfied U.S. evangelicals and Israeli hard-liners who dream of a greater Israel. That kind of support may help Trump and Pence with their electioneering at home. If they want to advance Israeli-Palestinian peace, however, they will have to appeal to the Palestinians and Christians who now shun them.

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