Special Reports
The Price of China's Pollution, and Its Environmental Catch-22

By Alex Pasternack
December 6, 2007

Last week, spurred by the announcement that China would be spending $27 billion
on pollution clean-up, I wondered what it would actually cost to clean up China.
Though the Green GDP project by the state environmental agency (SEPA) looks dead
in the water, at least for now, Xinhua reminds us that the World Bank is still
keeping score.

In July, the World Bank (along with SEPA) released a report saying that
pollution costs China US$100 billion a year, or 5.8 percent of its gross
domestic product (that's about half of China's own first rough estimates). When
it was released in China, however, Chinese officials had succeeded in stripping
the report of a more sobering number: 750,000 -- the number of premature deaths
in China per year due to air and water pollution.

While the estimate (which, as John pointed out, is hard to really appreciate)
remains unreported in the Chinese media, last week state news agency Xinhua ran
another story on the report: "Air pollution, especially in large cities, is
leading to higher incidence of lung diseases, including cancer, respiratory
system problems and therefore higher levels of work and school absenteeism,
[World Bank China chief David] Dollar said..."

But why is this report receiving more press from the state-run media even when
its heart has been cut out by the very same state?

That the report is being publicized again -- but only its economic, not human,
cost estimates -- isn't just a reflection of the in-fighting inherent in a large
bureaucracy like the Chinese government. It demonstrates the official
schizophrenia that can set in before the country's large environmental threat.
This is how the national government can laud an eco-activist one year and look
away when local officials arrest him the next.

One side of the government's mouth says that if pollution is to stop choking
growth it must be widely publicized; if it is widely publicized, the other side
says, the Communist Party risks the social stability that keeps it in power. And
it's that power, if any power, that is of course capable of righting the macro
problems that lead to pollution: a weak legal system, a myopic emphasis on
economic growth -- and a system that doesn't allow the publication of pollution estimates.

But for some people, the costs are already quite obvious, and their fight
against pollution (see the example of Xiamen, most recently) is slowly helping
to change the environment, and, crucially, the political climate too. In other
words, the costs of pollution on the people of China is going to lead to a way
out of this Catch-22, no matter what the government says or doesn't say.
Read the World Bank's uncensored "Cost of Pollution in China" report.


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