I wanted to blog about this last week, but ran out of time as other news grabbed the headlines. It’s surprising to me that this story hasn’t received more airtime, because it’s a significant indicator of how serious the Obama administration is about environmental protection and energy independence. By now, we all know that the administration’s “HEE” (Health, Energy, Education) priorities are being spelled out at every opportunity. They won’t be caught ranking those three priorities, but it’s clear at this point that Energy (and environmental protection) is not the least important.

So here’s the news that seemed to have slipped beneath many radar screens: In Congressional testimony a couple weeks ago, Energy Secretary Steven Chu stated this: “If other countries don’t impose a cost on carbon, then we will be at a disadvantage, and we would look at considering perhaps duties that would offset that cost.”

Translation: If (and it’s a very big If) Obama’s carbon cap and trade program is implemented to begin reducing greenhouse emissions produced by the United States, American companies may be at a competitive cost disadvantage compared to other countries (say, oh I don’t know, how about China) that don’t have similar carbon caps. One way to address or eliminate that cost disadvantage is to artificially raise the price of goods coming from that country by imposing import taxes on it. Which is exactly what Secretary Chu proposed in his testimony.

Using import duties to level an uncompetitive playing field, of course, is not new. The U.S. regularly imposes tariffs when it believes a foreign country is dumping goods in the U.S. below the cost of production, or as retaliation in a trade dispute (we are getting ready to tax the heck out of French cheese because the French won’t eat our hormone-treated beef). Other countries do the same to us (Mexico recently imposed a slew of tariffs for our alleged NAFTA violations including not permitting Mexican trucks on too U.S. highways). These tariffs are entirely the prerogative of the U.S. President under U.S. law (it helps if there’s data to back it up, typically from the Department of Commerce and the International Trade Commission), and do not require Congressional enactment or approval. In other words, this could really happen.

The response to Secretary Chu’s proclamation has been swift and largely negative, and comes largely from trading partners such as China and Australia, as well as conservative-leaning think tanks (which, let’s be honest, never met a tariff they liked). The Wall Street Journal roundly condemned the idea in its editorial pages yesterday. At this point, it’s probably all a storm in a teacup, because the U.S. won’t think of imposing these tariffs until it’s passed carbon cap emissions, which many experts now think may not happen until 2010 at the earliest. However, this is a development to watch. A tariff on products from China (which probably includes virtually all your IT and data center equipment) would be very big news indeed.