President Joe Biden issued a rare veto on Tuesday against a bipartisan measure that aims to reinstate tariffs on solar products from Southeast Asian countries after U.S. officials found China companies using these nations to get around trade rules.
The measure passed by the GOP-led House and Democrat-controlled Senate “bets against American innovation,” Biden said in a message from the White House announcing the third veto of his presidency. Biden also said it causes uncertainty for the U.S. solar industry, which is central to the president’s goal of reaching a “carbon-free electricity sector” by 2035.
At issue is a Commerce Department rule that instituted a two-year moratorium on penalties against solar cells and modules exported from Cambodia, Malaysia, Thailand, and Vietnam. As explained in the Federal Register, Biden authorized the move with a proclamation in June 2022 to “ensure access to a sufficient supply of solar cells and modules to assist in meeting the United States’ electricity generation needs” while the Commerce Department conducts inquiries into ways in which China is able to circumvent U.S. tariffs through its neighbors.
After preliminary findings reported in December showed at least four Chinese companies evading U.S. tariffs through Southeast Asian countries, Republicans in the House and Senate led the charge against the rule, arguing the Chinese Communist Party (CCP) needed to be held accountable for breaking U.S. trade laws as well as for human rights abuses.
“Every day that this rule is in effect the CCP gets closer to dominating the solar market, making it harder for Americans to compete,” said Rep. Bill Posey (R-FL), who introduced the resolution in the House.
Some Democrats joined the effort, including Sen. Joe Manchin (D-WV), who co-sponsored the Senate version. The United States “cannot continue to let China get away with laundering solar energy components through other nations with absolutely no consequences,” Manchin said.
A group of Democrats in the Senate who sided with members of the solar industry in voicing support for Biden’s veto said the bipartisan measure threatens “to derail much of the progress we’ve made and kill good-paying American jobs, while threatening our clean energy future.”
Biden said on Tuesday that he does not intend to extend the tariff suspension at the conclusion of the two-year period in June 2024, citing “progress” made in the U.S. solar sector.
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Biden issued his first veto in March to block a measure that sought to overturn a rule allowing retirement fiduciaries to invest in accordance with the environmental, social, and corporate governance movement, also known as ESG. Biden’s second veto, in April, struck down an effort to roll back a waterways rule.