China's engine of environmental collapse

October 14, 2020

China's Engine of Environmental Collapse
By Richard Smith
Pluto Press, 2020

In China's Engine of Environmental Collapse, author Richard Smith discusses the pollution of China's air, water and soil, its waste of resources and its contribution to climate change.

The Chinese economy has grown very rapidly over the past 40 years. Smith writes: "In 1979, China's economy accounted for just 1.8% of global GDP, as against 26% for the United States. Today, China accounts for 15.5% of global GDP while the US share has dropped to 23.6%".

But this growth has come at a huge environmental cost.

"China's reckless cheap-and-dirty mode of development has savaged its environment and ecology. Uncontrolled dumping has defiled rivers, lakes and aquifers. Long stretches of China's rivers are officially classed as 'too toxic to touch',” writes Smith.

“In 2016, the government reported that 80% of tested water wells across the North China Plain (home to 400 million people) were 'so badly contaminated with industrial and other pollutants as to be unsafe for drinking or home use', but urban residents and farmers have little choice but to drink those waters and irrigate crops with them.

“In 2013, the Ministry of Land and Resources conceded that three million hectares of farmland, an area the size of Belgium, was 'too toxic to farm' because of the overapplication of fertilisers and pesticides, irrigation with toxic industrial wastewater, and the dumping of toxic waste on fields".

There has also been huge resource waste, as well as a terrible human cost.

"Builders and manufacturers have built shiny new cities and infrastructure at 'China speed', as People's Daily likes to brag,” writes Smith.

“But in their haste to build and overbuild, they've wasted staggering quantities of natural resources and racked up the worst industrial health and safety record of any nation on Earth, with more than 100,000 workplace deaths per year in recent decades".

This wasteful development affects the world environment: "In its race to 'catch up and overtake the US', soaring carbon dioxide emissions have made China by far the leading driver of global climate collapse,” writes Smith.

“In 2018, China's CO2 emissions were nearly as much as those of the next five next-largest emitters (the US, India, Russia, Japan and Germany) combined.”

Smith documents these problems in detail. He also analyses the economic system that has produced them.

In Smith's view, China's social system is a hybrid of two systems: capitalism and "bureaucratic collectivism". While he does not explicitly define the latter term, it seems to refer to a system where the state plays a major role in the economy, and the state is controlled by a privileged bureaucracy.

Smith shows that both the private sector of the economy (including transnational corporations, or TNCs) and the state sector contribute to the environmental disaster.

Capitalism in China

Beginning in the 1980s and accelerating in the 1990s, TNCs based in the US, Europe and Japan shifted much of their production to China. Their reasons included China's low pay rates and lack of environmental protection, as well as the relative efficiency of the Chinese state in providing infrastructure.

According to Smith: "Over the past four decades, China's comparative advantage in the world economy has lain in three crucial factors:

• Dramatic cost reductions made possible by the provision of vast numbers of semi-coerced ultra-cheap workers to power light manufacturing for export ‒ kept cheap, at least up to the mid-2000s, by the police state-led militarisation of employment in the export zones, including the suppression of worker resistance and unionisation efforts;

• Further dramatic cost reductions have been made possible by contempt for, and lack of spending on, environmental protection; and

• The capacity of China's developmental state to work closely with foreign and domestic investors to build the physical infrastructure, the schools and universities, and teach English to millions of young people.”

In recent years, workers have made some gains: "Chinese workers have nevertheless fought back, in waves of illegal strikes and protests in the early 1990s and the early 2000s; and from 2010 they succeeded in winning wage increases, improvements in working conditions, reductions in employer abuse, legal limits on overtime, and other gains,” writes Smith.

“But [Xi Jinping's] government has taken an increasingly hard line against labour unrest in recent years, closing down labour-focused NGOs and arresting strikers en masse."

And while workers have made some economic gains, the environment has continued to deteriorate: "[T]he combination of ultra-cheap labour and minimal environmental restrictions attracted many of the world's dirtiest and least sustainable industries,” writes Smith.

“Steel, coke, aluminium, cement, chemicals and petrochemicals, metal plating, leather tanning, plastics, paints and finishes, synthetic fibres and textile production, fabric dyeing, paper production ‒ facing increasingly tough environmental restrictions at home in the US and Europe ‒ relocated to China after 1980".

The transnational corporations try to maximise sales by promoting disposable products, designed to be thrown away and replaced by new ones after a short period of use. Examples include new fashions in clothing and new models of electronic goods. This increases the pollution and waste of resources in China.

State sector

China privatised or shut down many small and medium state-owned enterprises (SOEs), causing 30 million workers to lose their jobs in the late 1990s and early 2000s. But some key industries were kept under state ownership.

Smith characterises the state-owned section of the economy as characterised by "overproduction and waste … Beijing's central planners launched wave after wave of gargantuan development projects, beginning in the 1990s".

These included huge dams, new cities, ports and airports, and national high-speed rail and highway systems.

"But China's state-owned producers don't stop when they have produced and built enough,” writes Smith.

“Beijing regularly complains that local officials squander resources in building superfluous housing, redundant infrastructure, and useless vanity projects that the country simply does not need. From the start, this investment boom has been characterised by overproduction, profligate waste of resources and energy, and needless pollution".

One of the drivers for waste is the "hyper-nationalist ambition" promoted by Xi "to make China rich and powerful, to restore its 'greatness', to 'catch up and overtake the United States' and become the world's leading superpower," writes Smith.

Another motivation for government bodies and SOEs to launch big construction projects, many of which are wasteful, is to minimise popular discontent by providing jobs for workers. Big projects create jobs, not only in the state-owned enterprise themselves, but also in private companies that have contracts with SOEs.

But in addition, officials at all levels see big construction projects as an opportunity for them to benefit from corruption, for example by taking bribes in return for the allocation of contracts.

Local governments and SOEs fund big projects by borrowing from state-owned banks, which are willing to lend to projects that will supposedly help make China "great".

What is to be done?

Smith argues that China, like other countries, needs to take drastic action to cut pollution and waste: "China is going to have to shut down, phase out, or downsize thousands of fossil fuel-based, unsustainable industries across the economy,” writes Smith.

“The same goes for the US, the European Union countries, Japan, India, and the other nations that presently account for the bulk of CO2 emissions".

This will require the creation of new, environmentally-friendly jobs for the hundreds of millions of workers who are displaced.

Smith argues that both the "normal" capitalist system, exemplified by the US, and China's hybrid system are "unsustainable and suicidal".

Smith writes: "I contend that given the state of the planet today, the only way to prevent runaway global warming is to slam the brakes on economic growth in both China and the US, shut down entire swathes of useless, superfluous, harmful and destructive industries, and replace these political-economic systems with an ecosocialist world economy based on public ownership of most means of production, democratically planned production for need, and democratic management of the economy and society.

"Capitalism, democratic capitalism, or even 'green capitalism', is no solution for China's environmental crisis… No amount of tinkering with the market can brake the drive to global environmental and ecological collapse … we need a wholesale system change, especially in China and the United States.”

There has been a rise in strikes and protests in China in recent years: "Labour strife has increased decade after decade, along with growing protests over land grabs, pollution, the siting of chemical plants, incinerators and coal-fired power plants.

“Environmental protests frequently involve thousands of people and are often violent. China Labour Bulletin counted 1700 industrial strikes in 2018, up from 1200 the year before," writes Smith.

In Smith's opinion, these outbreaks of rebellion indicate the potential for a new Chinese revolution.

Some disagreements

Smith's critique of China's environmental policies is valid and very important. But some of his other comments are wrong in my opinion.

Smith complains that China is stealing "intellectual property" from Western companies. But the fact that TNCs control a large part of the world's "intellectual property" is a big problem. It means, for example, that poor people can't afford life-saving drugs because the pharmaceutical companies that hold the patents charge high prices.

Ownership of "intellectual property" also enables TNCs to exploit Chinese workers, such as those who make iPhones for Apple.

The whole concept of intellectual property (IP) should be questioned. The scientific achievements of humanity should be used for the benefit of the world's people, not for the profits of corporations.

Smith claims that Xi's “Stalinist state-owned sector is a poor innovator and without domestic IP protection his private sector isn't much better.

“Since Xi's economy has been unable, so far, to invent the advanced technology it needs, the government has been critically dependent upon importing that from the West since Reform and Opening in 1978, largely by forced transfer, and tech and IP theft,” he writes

But there is nothing unusual in the fact that a later-developing capitalist country begins by importing technology from earlier-developing ones, before developing the skills to carry out its own technological innovation. Japan is an example.

Smith claims that Xi's "sociopathic behaviour" is "turning the world against China". This is a gross exaggeration. The picture is mixed.

Certainly, there is resentment towards China in some countries ‒ for example, China's attempt to monopolise the South China Sea has antagonised countries such as Vietnam, the Philippines and Indonesia.

But in some parts of the world, China's prestige has been rising, due to its funding of development projects through its Belt and Road Initiative. Of course, these projects bring environmental problems like those in China itself.

"With China's own citizens too terrified to openly oppose the government, some are whispering that 'Only [US President Donald] Trump can save China'," writes Smith.

I doubt that many Chinese, even those most critical of the government, would look to Trump for salvation. There have always been some people in China with illusions in the West, but even many of them would have been shocked by Trump's disastrous response to COVID-19.

Despite these criticisms, the book is well worth reading. It is very informative, and Smith is right to point to the need for system change, both in China and in countries such as the US.

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