Sunday, May 17, 2009

How Much Carbon Does a Dragon Emit?

In his Times column, Paul Krugman argues that if China won't control its carbon emissions, we should impose a tariff:
China’s emissions, which come largely from its coal-burning electricity plants, doubled between 1996 and 2006. That was a much faster pace of growth than in the previous decade. And the trend seems set to continue: In January, China announced that it plans to continue its reliance on coal as its main energy source and that to feed its economic growth it will increase coal production 30 percent by 2015. That’s a decision that, all by itself, will swamp any emission reductions elsewhere.

So what is to be done about the China problem?

Nothing, say the Chinese. Each time I raised the issue during my visit, I was met with outraged declarations that it was unfair to expect China to limit its use of fossil fuels. After all, they declared, the West faced no similar constraints during its development; while China may be the world’s largest source of carbon-dioxide emissions, its per-capita emissions are still far below American levels; and anyway, the great bulk of the global warming that has already happened is due not to China but to the past carbon emissions of today’s wealthy nations.

And they’re right. It is unfair to expect China to live within constraints that we didn’t have to face when our own economy was on its way up. But that unfairness doesn’t change the fact that letting China match the West’s past profligacy would doom the Earth as we know it.

Historical injustice aside, the Chinese also insisted that they should not be held responsible for the greenhouse gases they emit when producing goods for foreign consumers. But they refused to accept the logical implication of this view — that the burden should fall on those foreign consumers instead, that shoppers who buy Chinese products should pay a “carbon tariff” that reflects the emissions associated with those goods’ production. That, said the Chinese, would violate the principles of free trade.

Sorry, but the climate-change consequences of Chinese production have to be taken into account somewhere.
James Fallows thinks Krugman misreads what's going on in China:
While his conclusion -- that China has to be part of global efforts to control carbon emissions -- is obviously correct and important, his premise -- that no one in China admits this -- does not square with my observation over these past three years.* As it happens, I spent this very day at a conference in Beijing where the first five presentations I heard were about emissions-reductions and sustainability in one specific domestic industry. (Also, I wrote in the magazine, a year ago, about Chinese people and organizations making similar efforts in a variety of other fields.)

If blunt-instrument outside pressure like this column makes it more likely that Chinese authorities will keep making progress, then as a pure matter of power-politics I say: fine. But my guess and observation is that it is just as likely to get their back up -- and encourage the ever-present victimization mentality that makes it less rather than more likely that Chinese authorities will behave "responsibly" on the international stage.

As I've written a million times (most recently here and here and generally here), arguably the most important thing that will happen on Barack Obama's watch is reaching an agreement with China -- or not -- on environmental and climate issues. We'll see what's the best means toward that end.
Tyler Cowen also has objections. Gary Clyde Hufbauer and Jisun Kim discussed the idea of using tariffs as an instrument of climate policy in a Vox post last year.

3 comments:

Anonymous said...

China is also restructuring the coal industry on the micro scale. They are merging the non-government owned coal mines with the government owned state owned enterprises (SOE's) in an attempt to increase output and safety for the workers. This will increase output as they recently have found the SOE coal mines have 30% higher output than non-SOE. The main issue is that this will increase the government subsidizes to this industry and that this is a convergence from a free market style industry to a government owned industry. Just like most other energy industry sectors in China. Prior to 1980 China's coal industry was one government entity, but inefficiency drove a movement to privatization of the coal industry.

This is causing an introduction of politics back into this sector and significant backing from the government against emission standards. It is highly unlikely that the Chinese government will worry about coal emissions over efficiency.

Bill C said...

Thanks. That's very interesting. In theory, one would hope that state-owned/subsidized businesses might better take into account externalities like carbon emissions. But it sounds like the political pressure for fast economic growth might outweigh that in China.

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