Chinese Imports Are A "Direct Threat" to Biden's Agenda

Unions, manufacturing groups and some economists say the administration may need to do much more to restrict Chinese imports if it hopes to ensure that Mr. Biden’s vast industrial initiatives are not swamped by lower-cost Chinese versions of the same emerging technologies.

“It is a very clear and present danger, because the industrial policy of the Biden administration is largely focused on not the traditional low-skill, low-wage manufacturing, but new, high-tech manufacturing,” said Eswar Prasad, a Cornell University economist who specializes in trade policies.

“Those are precisely the areas where China has upped its own investments,” he said.

Both America and China are using large government subsidies to stoke economic growth and try to dominate what they believe will be the most important global markets of this century: the technologies meant to speed a global transition away from fossil fuels in order to avert catastrophic climate change.

Chinese officials have poured money into factories, including offering attractive loans from state-run banks to companies that might not have survived otherwise, to help offset a real estate crisis and sluggish domestic consumption. Those factories often run on low-cost labor.

Biden has conditioned federal money on companies paying relatively high wages or providing child care for workers. Other credits are conditioned on factories drawing on components that are mined or produced in America. Mr. Biden has staked his re-election pitch on creating more well-paying jobs, particularly union jobs, but some economists have raised concerns that those efforts to change corporate behavior will undermine his core industrial-policy objectives.

“On the one hand the Biden administration is doing everything it can to increase consumption of renewable energy products,” said Scott Lincicome, a trade expert at the Cato Institute, a libertarian research center. “On the other hand, it is warning China against the sale of cheap renewable energy products, which would boost American consumption of the very products we’re trying to encourage.”