Accounting for growth  

This article goes beyond previous attempts at environmental accounting in China. While September's SEPA and National Bureau of Statistics report (which concluded that China's pollution costs the country $64 billion a year) was a positive thing, it only scratched the surface by measuring pollution emissions, and only some of them - 10 of 20+, according to Stephen Green on chinadialogue. This article factors in the losses of land and resources, the irreperable damage to ecological systems and the worsening water crisis. While we may still not see a figure for "Green GDP" emerge just yet, this seems to bring us much closer indeed. SL

The power of statistics  

Thanks for your comment, SL. I think it nicely captures the larger meaning of this two-part series. While living in Beijing, I felt that statistics played a very significant role in Chinese political culture. So I hope that this kind of green accounting, despite its weak points, can become a routine part of five-year plans and newspaper reporting. Do economics students at Chinese universities study the idea of "ecosystem services"?

World ecosystems  

Thanks for this fascinating and important article. You refer to ten major types of land ecosystem in the world. But your list does not include wetlands and peatlands.

Found in both the tropics and high latitudes, peatlands are estimated to cover about 3% of the global landmass (see, for example, here: http://www.peatlandsni.gov.uk/formation/global.htm).

One of the reasons they may be considered significant is that -- like tundra - peatlands store carbon and methane. Changes in land use and climate change may result in large releases of these greenhouse gases from peatlands, and from wetlands.

Caspar Henderson

Don't just blame China

Actually, many developed countries have inescapable responsibilities for pollution in China, as they are polluting China in many ways.

Many developed countries have funded factories in China, and are taking advantage of China's weak environmental laws. The businesses they fund reduce and even ignore efforts in pollution control in China, even though they know it is wrong. They dare not behave the same way in their own countries where they will be punished for these illegalities.

Setting Scale Limits on Economic Activity  

Human beings are not gods, we must live and operate inside limits, that is also true for economic activities which are subject to scale limits. Beyond optimal scale limits the "services" provided by nature (ecological system services like nutrient cycling, gas regulation, climate regulation and the water cycle) degrade. In addition, resource stocks of energy and materials deplete, faster than they can be replenished (fish) or clean substitutes developed (oil). That is why there is such a thing as "uneconomic growth". If, as Gaoming Jiang and Jixi Gao say, environmental degradation "threatens the survival of the Chinese people" then the costs of growth are exceed the benefits.

When Gaoming Jiang and Jixi Gao write that "The economic losses caused by pollution are rising, and if they are not controlled they will hold back China’s growth" this seems paradoxical to me because the authors are here presenting the ecological problems as barriers to economic growth - which seems to imply that economic growth is still a desirable goal to them. Yet economic growth is actually itself the problem. The pursuit of material wealth is happening in a sustaining and containing ecological sphere which can only tolerate so much material economic activity before the economy becomes like a multiplying cancer that kills its host.

This means the first task of ecological economics is to impose scale limits on the economy - policy instruments are needed for each area of degradation of eco-system services and for each area of natural resource depletion. Policy instruments to impose scale limits are also needed for the economy as a whole, as a macro entity. For the economy as a whole the best policy instrument would be to establish a permit system which sets a strict cap on the use of the earth's atmosphere as a greenhouse gas dump. (The "cap and share system" would be my preference). Once scale limits are set economic development operates in a different way - more efficient methods of operating with the scale boundraries are looked for. Setting scale limits has to be done in a way that is considered fair between countries and within countries - to economists this is a matter of distribution and social justice. It requires a free society able to debate and research issues, with a framework of law and an ability for people to organise to protect the interest of vulnerable people and able to defend their environment. After that, and only in this framework, can the market be left to to find the least cost and more efficient way of allocating resources.

That defines the problem for China and the rest of the world - indeed its obvious that the future of humanity depends on China's ability to create such system. Brian Davey

Re: Setting scale limits  

Brian Davey: I think you've misidentified the problem. 'Economic growth' is not so much the problem, as the current mode of economic growth. For so long we have grown economies in a way that destroys the environment. With recent technological developments, many of which have been decidedly lo-tech, we have been reminded that we have the brain power to find other ways to get rich.

And yes, policy and regulation are important to enforcing a short term solution, but the key to long term survival is not just China changing, but a fundamental change in the mode of the whole world's economic growth, from the crude exploitative model we have now to a sustainable, circular future.

Anonymous who mentioned the fault of foreign investors: You are absolutely right, but at the same time the developing world must take steps to protect itself. Capitalists are opportunists looking for maximum short-term profit. They don't care about the long-term consequences of their actions, they will have the money to protect themselves, everybody else is a tool to be used in their quest for wealth.

chriswaugh_bj.livejournal.com

Growth and ecology  

Chris Waugh: The idea that growth can occur without growing throughput of materials and energy and without ecological destruction is difficult to accept. It has been estimated that around half of the energy used in a wealthy country is necessitated by projects designed to expand the economy. This should not surprise. Merely maintaining or reproducing existing production processes requires much less energy than producing something new. This extra energy throughput, required by growth, is overwhelming derived from fossil fuels. It is taken from depletable sources of fossil energy sources which are burned and their waste products discharged into eco-system sinks.

The illusion that there can be a form of "angelised growth" has largely been fostered by the 'de-materialisation' of western economies which have become much more service and information processing focused. This illusion in one part of the globe has partly been possible because polluting material production processes have been re-located - to a large degree to China, where they are out of sight and out of mind. Even a service and information economy is embedded and embodied in a material infrastructure - e.g. a computer telecommunications network and a transport system - which must be manufactured somewhere. And most businesses are only too keen to sell people who grow wealthier new gadgets that embody lots of energy and materials in their production and which throughput lots of energy and materials in their use - cars, fridges, washing machines, micro-wave cookers, play stations, televisions....

It's true, of course, that we would grow psychologically as responsible human beings if we could take in and live according to this message in better relationships with each other in a juster and less polluted world. However, this would be human psychological growth - perhaps even "spiritual" growth insofar as spiritual progress is about learning to live with and accept limits. It is not economic growth which is ultimately a fantasy that there are no material limits.