Tuesday, January 28, 2014

China's attempts to artificially break the Kuznet's curve

Societies make explicit and implicit choices trading off short term and long term needs. That's what the environmental Kuznet's curve shows (Wikipedia) - we tend to trade off harm to the environment and long term health in exchange for shorter term economic gains but at some point our needs shift. The problem is China's crony capitalism - particularly when it comes to the control and ownership of its heavy industry masquerades as market based. China's attempt to centrally manage this tradeoff isn't going so well (AllRoadsLeadtoChina):

When the first “Airpocalypse” descended last year, I was asked by a member of the media what could be done to “solve” the crisis. A loaded question no doubt, but in thinking about the fact that China’s economy will double by 2025, and its energy package will need to be 400% of today’s, there was only one real solution to the problem.

They could turn off the economy

Which, as you can see from the 30 day snapshot above is in fact what they are doing on a rolling basis. Telling factories, foundries, construction sites and trucks to shut down or curb activity when emissions surpass 250-300, and then allowing them to resume once the figures get below 50.

It is a tug of war that I personally view as being not only unsustainable, but far more expensive than any model I can think of for finding a real balance.

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