Special Reports
Dispelling Beijing’s Haze

By Brian Lilley
August 26, 2008

China's pollution is generated by the world's demand for its cheap
manufactured goods.

With the Olympics finishing, the headlines have turned mostly from China's
problems, Bible confiscation, lip synching and pollution to what the games
are truly about; the beauty of athletic competition, Michael Phelps' eight
gold medals, the stunning speed of Usain "Lightning" Bolt. Yet before the
games began, most headlines focused on the problems surrounding the games,
most notably, pollution.

The New Scientist asked bluntly "Is Beijing's air safe to breathe?", The
San Francisco Chronicle headline declared "Excitement and smog are in the
air as Beijing's party starts" while the Guardian told readers that the
"IOC risks legal action over smog". As the Olympics opened, Western worry
over Chinese pollution reached a level nearing the concerns over Tibetan
protesters a few months earlier. Yet for all the hand wringing in the
Western media over the state of the air our athletes were subjected to,
and that Beijing residents must deal with year round, is how much
responsibility do we in the West bear for the haze that has settled over
the Olympics?

What's that you say? You have no responsibility for the air quality in
China? Well, partly you may be right, but chances are you are as guilty as I am.

Look into the bottom of your shopping cart on a weekly basis and
throughout your home and you will likely find Made in China stamped across
more than a few items. Cheap Chinese goods have been fueling the high
standard of living in the West for years. My first DVD player, made in
Japan, cost several hundred dollars. When the DVD player stopped working a
few months back, it was quickly replaced by a new model with more features
for less than $40. Where was it made? Yep, that's right, China.

Manufacturing in America, Canada, Britain and Australia has been shipped
offshore to China steadily over the last few decades. As our inefficient
and dirty industries have shut down, China has picked up the slack and in
some cases, our old dirty factories. My father, a boilermaker by trade,
was given the opportunity during the 1990s to help ship factories from
Canada to China. Factories too old and inefficient to operate here were
being dismantled and shipped to China for re-assembly.

A friend of mine who dabbles in photography as a hobby tells of former
employees of film-making giant Kodak Eastman watching their old plant be
demolished, while snapping pictures or video of the proceedings on their
digital cameras and cellphones, many likely made in China. Our addiction
to inexpensive gadgets, throw-away housewares and prices that go down
rather than up for electronics and computers have all helped to sully the
air that hangs over China's capital. Each of us could try to do our part
to clear the air in Beijing by purchasing fewer goods from China's
pollution pumping sweatshops, but few of us consider pollution in a
foreign country or even jobs in our own when eyeing up a $35 DVD player.

Are there solutions from governments, Western governments, that is? Some
economists think so. In a report issued in March 2008, Jeff Rubin, an
economist with CIBC World Markets, talked of a carbon tariff being imposed
on goods from developing countries such as China and India. In an article
in the Toronto Star, Rubin said "It becomes absurdly quixotic to ban coal
plants in North America while at the same time China's got 570 coal plants
slated to go into production between now and 2012, 30 plants between now
and the Olympics." According to Rubin, imposing a carbon tax would also
bring manufacturing jobs back to North American shores. The higher cost of
oil, plus what is essentially a tax on pollution, would benefit industries
in North American such as glass, printing and machinery, says Rubin.

The idea reminds me of a conversation I had with a farmer protesting
government regulation. The farmer asked why he should be banned from
certain practices, such as the use of certain chemical pesticides and
herbicides, while imports from other countries still using those same
products were freely allowed to enter the country and be sold for a
cheaper price. We have done the same thing with our manufacturing and
"dirty" industries in the West. We have demanded efficiency, high wages
and strong government regulation and driven them offshore to China. The
jobs have left, so has the pollution and now we buy our goods from China.
The workshop of the world is not only the home of cheap labour; it is also
the home of cheap and dirty energy and few environmental controls.

So is the solution to emulate China and let loose on environmental and
labour controls? Hardly, but neither is it a solution to export jobs and
pollution overseas, leaving Western economies to provide nothing but
"services". The current position not only harms the natural environment
and national job markets, but leaves Western nations unable to manufacture
much of anything, a situation that leaves us all beholden to China.

Backers of the status quo will argue that the market will decide, yet the
current situation of strong regulation for domestic manufacturers and none
for imports means Western industry is fighting against Chinese industry
with one hand tied behind its back. The status quo is not working. As
Ronald Reagan once famously said "Status quo, you know, is Latin for 'the
mess we're in.'" It is time for fresh thinking on economic dealings with China.


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