OPINION:
For years, China has strengthened its economy, military, and geopolitical influence at the expense of the U.S. This must stop. It is time to hold communist China accountable with comprehensive legislation that addresses economic development, national security, and the environment. The Foreign Pollution Fee Act (FPFA) is the path forward.
Over the years, China has gained an unfair trade advantage over American companies by intentionally not enforcing environmental standards. A business deciding between opening a manufacturing plant in the U.S. or China has a clear monetary incentive to pick China. This has contributed to 2.5 million American jobs being lost to China over the last 20 years.
This is negatively affecting our environment. Up to a quarter of sulfate pollution in the western U.S. comes from Chinese emissions, according to a study published by the Proceedings of the National Academy of Sciences. China’s greenhouse gas (GHG) emissions now exceed those of the U.S. and EU combined.
As this took place, China’s GDP grew from 19th globally to second. China has used its economic strength to become the second-greatest military power in the world. China uses military power as a hegemonic tool, seeking to intimidate Japan, Taiwan, the Philippines, and other U.S. allies.
China gets American jobs, expands economically, and uses economic strength to militarize, while America gets China’s pollution. At the same time, the U.S. spends billions to make sure our manufacturing and energy production is the cleanest in the world. This is wrong.
Classical economics says that there is a place for fees or tariffs if there is an externality, like pollution, not included in the price of a good. This is the basis for the FPFA. This fee capitalizes on the fact that the U.S. has invested billions to control emissions. The FPFA would be commensurate with the avoided cost of complying with international pollution control norms. This decreases the ability of China (and other high-polluting countries) to underprice U.S. manufacturers. The FPFA will incentivize high-polluting countries to reduce emissions. To the degree that it equalizes manufacturing costs, it can encourage re-shoring jobs. Speaking of China in particular, in concert with the economic advantage shifting to the U.S., China will have less money to militarize. For the U.S., it’s a win, win, win, instead of a lose, lose, lose.
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I recently presented my plan to Americans from across the country visiting D.C. in the latest episode of Bill on the Hill. People agreed that putting a fee on dirty products coming from high-polluting countries was not only wise policy but the reasonable course of action. This is consistent with recent nationwide polling that found that 84% of Americans favor taxing foreign companies for importing products that emit more GHG than comparable U.S. products.
It makes absolutely no sense to continue allowing China and other countries to pollute freely and weaken the U.S. economically, and relatively speaking, militarily. We must turn the tables to make China pay instead of making the American people pay. The FPFA does this.
• Sen. Bill Cassidy was elected to the U.S. Senate in 2014. He serves on the Finance Committee, the Health, Education, Labor, & Pensions Committee (HELP), the Energy and Natural Resources Committee, and the Veterans Affairs Committee.
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