Within the last week, CNN and the New York Times have both released stories on China and electric cars. The common theme? China is pushing ahead on electric vehicles, and a wider push into cleaner energy while the Trump administration pushes in the opposite direction.
On one hand is the direction the two governments are pushing. China is expanding incentives for EV adoption, tightening fuel economy standards, and making changes to attract EV manufacturers. The Trump administration has been pushing to loosen fuel economy standards, end the EV tax credit, and put tariffs on solar panels.
The other aspect of this is where the United States and China differ drastically: government control of industry. The Chinese government has broad influence over “private” industry, and has proven unafraid to use Chinese firms as pawns in wider political chess games. The U.S. is quite the opposite, with firmly entrenched legal and constitutional limits on how much power government can wield over industry (at least in theory), and industry often openly influences public policy to their own ends.
The Chinese government is using their influence over industry to win the electric vehicle “arms race”. Chinese firms, under orders from Beijing, are quietly securing control over lithium and cobalt mines in various parts of the world. Meanwhile, the Trump administration has tried, and failed, to force power companies to use more coal and reduce their use of natural gas and renewables.
While it’s easy to see both of these situations as wins for cleaner energy, it’s not that simple. The free market is slowly drifting away from oil and coal and toward EVs and renewables. Lower fuel costs, lower maintenance costs, better reliability, and improved power are favoring the shift despite massive oil subsidies and shady political moves to keep the public hooked on internal combustion in past decades. Both countries are living with this technological trend, but one wields its power to support a faster shift while the other tries desperately to slow it down.
The inescapable conclusion is that this spells trouble for the United States. By allowing China to gain control of needed battery minerals while trying to discourage adoption of EVs at home, we will be left vulnerable to future manipulation and bullying. This leaves our domestic automobile industry, and its jobs, at risk.
If Trump and the republicans would practice what they preach on free markets and simply allow the free market to move to cleaner alternatives, there would be little to worry about.