https://www.wsj.com/articles/beijing-gets-a-great-leap-forward-from-congress-inflation-reduction-act-green-energy-subsidies-innovation-price-controls-capitalism-xi-jinping-11660502287?mod=opinion_lead_pos6
“Capitalism and free markets made the U.S. the world’s leading innovator, energy producer and economic superpower. Though alarms about China’s supplanting the U.S. in recent years have probably been overplayed, they could wind up being a self-fulfilling prophecy if Congress keeps passing self-defeating laws.”
China’s economy is limping under the weight of government-created market inefficiencies, draconian Covid lockdown policies, an imploding real-estate bubble, and an aging population. But Congress’s self-defeating Inflation Reduction Act gives President Xi Jinping something to celebrate this November at the Communist Party’s 20th National Congress.
With a single legislative act, Democrats have increased Beijing’s geopolitical leverage, reduced American living standards and global economic competitiveness, and assisted Mr. Xi’s ambitions to dominate biotech. The kicker is that Democrats have told Americans their bill will deal a blow to China. Americans will be in for a rude awakening when they discover the truth.
Take the legislation’s effect on American energy production. The U.S. has become the world’s top oil and natural-gas producer owing to its abundant natural resources, hydraulic shale fracturing and other technological advances. The Inflation Reduction Act, however, effectively concedes American energy supremacy to China by turbocharging the government’s green-energy transition with $370 billion in climate spending.
Renewable energy requires vast amounts of critical minerals such as cobalt, nickel, manganese, lithium and graphite. China controls a large share of the world’s supply of each and also maintains a chokehold on their refining. Its near-total global monopoly extends to the manufacturing of lithium-ion batteries, cells and components as well as solar cells.