China responded to the recently imposed 31 percent U.S anti-dumping tariffs on imports of Chinese solar panels with investigations into U.S. clean energy projects (WSJ). China’s Commerce Ministry alleges six projects in five states violated international trade law, and Beijing has stated that the tariffs reflect “the U.S.'s tendency toward trade protectionism.” The heads of four major Chinese solar power manufacturers have banded together to refute the determination of the U.S. Commerce Department.
CFR Senior Fellow and Renewing America Director Edward Alden discusses the general lack of trade protectionism in the wake of the Great Recession, and the likelihood that the WTO has restrained this political impulse.
International trade and investment. Read more from leading analysts on the debate over next steps in U.S. trade policy.
Education and Human Capital
A Common Core Can Spur Innovation
As part of Washington Monthly’s special report on education, Robert Rotham sees the adoption of the Common Core State Standards as a transformational moment that will unlock education innovation. He argues that nearly nationwide standards will help children who move from state to state and facilitate innovation by allowing the best educational products and practices to easily spread. Assessment should also improve as testing and requirements standardize, and it becomes easier to compare performance between states.
The report of the CFR Independent Task Force on U.S. Education Reform and National Security highlights the importance of the Common Core State Standards and asserts that fixing the nation’s underperforming K-12 schools is critical to economic competitiveness and national security.
Student Loan Bill Stalls
Politico reports that the Senate was unable to pass either party’s bill to renew a temporary rate cut on subsidized Stafford loans. Democrats favor eliminating a loophole that allows some self-employed professionals to avoid payroll taxes, while Republicans are targeting spending cuts in an element of the healthcare reform law. On July 1, subsidized Stafford loans are scheduled to return to an interest rate of 6.8 percent from the current 3.4 percent.
Education and human capital. Read more from experts discussing ways to improve U.S. education and immigration policies.
Corporate Regulation and Taxation
Wind Power Tax Credit Expiration Looms
The wind production tax credit will expire at year’s end; its renewal is attracting supporters from both parties (TheHill). President Obama spoke at an Iowa manufacturer of wind turbine parts in favor of renewal. Republican Senator Chuck Grassley of Iowa has introduced legislation to extend the credit and called renewing the tax credit a “no-brainer for many of us.” But Grassley also indicated that renewal may have to wait for other, less popular, expiring tax provisions to be debated on Capitol Hill.
Corporate regulation and taxation. Read more from top economists and business experts on solutions for addressing corporate tax reform.
Google Wins Patent Fight
Google and the Android platform won an important court victory yesterday, trouncing Oracle’s claims of patent infringement (Bloomberg). The patents in question relate to the Java programming language developed by Sun Microsystems, which Oracle acquired in 2010. Oracle had sought a billion dollars in damages, and wanted a licensing fee for every Android smartphone sold. Separately, a German court ruled that Google’s new Motorola Mobility subsidiary infringed a Microsoft patent related to text messaging (Reuters).
Should the United States adopt a “patent box” tax incentive as several European countries have done in recent years in order to spur innovation? This Policy Initiative Spotlight by Jonathan Masters examines the issue alongside a more conventional policy, the research, and development tax credit.
Innovation. Read more on how the U.S. capacity to innovate could play a chief role in economic growth.
The Morning Brief is compiled by Renewing America contributor Steven J. Markovich.