NEW YORK ( TheStreet) -- The U.S. Department of Commerce has decided it's an excellent idea to intensify trade tensions with China. The situation would be laughable if real taxpayer money were not at stake. After losing over $500 million dollars from a loan guarantee with Solyndra (money at least in part was borrowed from China), the Commerce Dept. is now imposing anti-dumping tariffs on Chinese solar companies.
Solyndra is the poster child of why private equity is more efficient than taxpayer money chasing political goodwill and feel-good pet projects. At the same time the government was dumping hundreds of millions in dollars down the drain, private enterprise cracked enough natural gas to kill any thoughts of solar gaining traction for years to come.
In an almost perverse twist of fate, some companies who are the targets of the tariffs may end up winning in the long run. Many smaller solar manufacturers in China are faced with a virtual product-banning 250% import tariff. However, two or three key companies are expected to "only" pay 31% according to Peter Pham of AlphaVN.com. The companies may find the tariff a benefit in multiple ways, if they can last long enough to make it through the other side. All told, it appears 61 companies are members of the 31% club, while other factories face 249.96%.Suntech (STP) , Trina Solar (TSL) and possibly others including LDK Solar (LDK) are Chinese companies reportedly to pay an anti-dumping 31% tariff. The disparity will leave other higher tariff paying companies with several choices:
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