After imposing additional tariffs on Chinese goods, how will the United States save its own industries?
The Biden administration faces a greater dilemma.
Four months ago, the Biden administration announced additional tariffs on Chinese goods worth $18 billion, which, after several postponements, will finally take effect on September 27th in a few days.
Just a few days before the implementation, they launched an important plan, but is it destined to be an illusion?
Before discussing this matter, please allow us to reflect that in the last few months of their term, the Biden administration is still working very hard.
It's just unclear whether they are working for the capital groups, for the Democratic Party's elections, or for the United States and its people.
In May of this year, before Biden had withdrawn his candidacy, the U.S. government convened a large number of journalists and grandly announced that it would impose additional tariffs on Chinese goods worth $18 billion.
The most important of these is electric vehicles, with tariffs as high as 100%, and an additional 25% tariff on key minerals and batteries.
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At that time, many people questioned this because the cost of the tariffs would be passed on to the American people.
Some experts believe that imposing tariffs on key minerals and batteries is very foolish because it directly increases the manufacturing cost of American cars.
The Biden administration claims that the tariffs are to protect domestic industries from the strong impact of the Chinese supply chain, giving them enough time and space to develop.
To develop domestic industries?
Now the latest measure of the Biden administration has come.
On September 20th, the U.S. Department of Energy announced that it will allocate more than $3 billion (approximately 21.2 billion yuan) to 25 battery projects in 14 states.
This has increased the U.S. government's subsidy funds for key minerals and battery supply chains to $35 billion (approximately 250 billion yuan).
The U.S. Department of Energy claims that most of these allocations will be used to promote the production of key minerals, which have become bottlenecks in the supply chains of electric vehicles, renewable energy, and defense applications.
Some American experts believe that in recent years, the large amount of funds that the U.S. government has injected into infrastructure and climate bills is greatly changing the U.S. battery manufacturing industry and saving the new energy industry in the United States.
Is this really the case?
The experts have forgotten that in his first year in office, Biden signed the Bipartisan Infrastructure Law, launching an ambitious infrastructure plan, with the electric vehicle charging pile project receiving up to $7.5 billion in funding.
The result of this grand project is astonishing.
In 2023, a spokesperson for the U.S. Federal Highway Administration revealed that two years later, the plan has only built 7 charging stations open to the public, with a total of 38 charging piles available for vehicles to charge.
A few days ago, we saw another report, the U.S. Department of Transportation claimed that since President Biden took office, the number of public charging piles has doubled to 192,000.
This means that in Biden's four years in office, about 96,000 charging piles have been newly built, which is already considered a rapid pace in the United States, but compared with the competitor China, the gap is really too big.
According to data from China's Ministry of Industry and Information Technology, by the end of 2023, China's charging infrastructure has reached a cumulative total of 8.596 million units, a year-on-year increase of 65%, and has now built the world's largest, most extensive, and most comprehensive charging infrastructure system.
Now, the United States is once again subsidizing key minerals and battery supply chains with money, which is likely to repeat the mistakes of the charging piles.
These facts raise a question: why has the U.S. government achieved far less with much more money than its Chinese counterparts?
Some people attribute the reason to the high cost and low efficiency of the United States, which is also a fact, but in fact, they are all superficial reasons.
So why is it?
Are Americans too stupid?
The fundamental reason is: the U.S. government can only spend money, and it can't do anything else, why do you say that?
In April 2023, Jake Sullivan, the National Security Advisor to the President of the United States, elaborated on the so-called "New Washington Consensus" in a speech.
Sullivan reflected and criticized the long-term free capitalist economic policy of the United States, believing that it has in fact weakened the key industries of the United States.
The government cannot let the industry develop freely and should play an active guiding role.
However, the guiding role he talks about can only be desperately spending money, and the Biden administration obviously believes that as long as the money is in place, everything will be solved.
This simple thinking is also one of the important reasons why the U.S. debt has skyrocketed from 23 trillion U.S. dollars to 35 trillion U.S. dollars in Biden's four years in office.
Some people ask, isn't spending money the most practical method?
If we had so much money, hum.
But don't forget, in this world, besides spending money, there are things to do, and some people don't do things even if they get the money.
What's more serious is that this kind of cheap money, they dare to charge 80,000 U.S. dollars for a bag of nails.
The truth behind it is that in addition to fiscal subsidies and tax cuts, the U.S. government has no ability to do industrial policy at all, because they have no state-owned capital, let alone state-owned enterprises.
Some people say that the money the U.S. government spends is not capital?
That's just printed money, not industrial capital, and the difference is huge.
The U.S. government has no capital in its hands, they can only persuade capital, guide capital; they have no way to do things directly, they cannot improve efficiency, and they cannot even prevent people from taking money to do fake things, such as charging piles that cannot charge.
The U.S. government has no productivity, only money, but it dreams of using money to command Wall Street and industrial capital.
What they lack is not money, they have more money than the U.S. government.
What they lack is not money, but advanced technology, high comprehensive cost performance, and large profit margin of high-quality projects, and such projects are all in China, but the U.S. government prohibits them from investing.
Therefore, the United States has spent 250 billion to save new energy, and it is also destined to be an illusion.