Does Cap And Trade Without China Make Sense?

[Graham Rankin]

China has been the world's leading emitter of CO2 for some time with over 6 billion metric tons in 2006 alone – and much more since. If global warming is false, this doesn't really matter because investors and retailers will continue to pressure manufacturers into outsourcing there, so the emissions will continue to rise anyway, but it won't matter to our future survival.

But what if global warming is true? And what if the extra Cap and Trade costs in the US exacerbate the pressures to outsource, as manufacturers in a recession try to keep shareholders and boards happy? The pressure to outsource is going to be formidable for CEOs.

So there could be more outsourcing to China, not less. And China has no binding plans whatsoever to cut emissions. It has some Greenwash projects that hit the headlines from time to time, but it will be reliant on coal for many decades yet. Cap and Trade could result in an increase in world CO2 emissions as more production is transferred from a regulated US and Europe to an unregulated, unfiltered coal burning China.

If global warming is false, that's a disaster just for Western manufacturing industry. But if global warming is true, it's a global disaster. Either way, unless China is pressured to join the CO2-capping countries, the whole project is a waste of time, because China's growth in emissions by 2050 will cancel out what the US and Europe save.

Now, governments can't influence China anymore because they depend on Chinese money to keep the banks afloat, the bonds bought and the currency from sinking. But consumers can. And that would be a real challenge to Greens to put their money where their mouths are. They'd have to buy locally.

No more iPhones. No more iPods. In fact no more Apple anything. Al Gore, a huge shareholder in Apple, will have to face the Inconvenient Truth that he should disinvest unless it relocates to lower CO2- emitting countries. Which it can't, because it doesn't make anything. It just gets most of its products from Hon Hai, who assemble them in Shenzhen, China. And no games consoles either. No laptops or netbooks, except for the few made in Taiwan and a couple in Europe. The list goes on.

We're having Cap and Trade. Environmentalists feel they've won that one. It's now time for Greens to show that they mean what they say, and that they are going to boycott all products from the biggest CO2 polluter over the next few decades, unless emissions are cut there too. Or we'll know it was all talk. Because you can't have Cap and Trade without involving China. It just doesn't make sense whichever way you look at it.

[Bill Waddell]

Cap and Trade is just the same as virtually every other environmental restriction the USA enacts unilaterally - only this time it is writ larger than most. It dwill not 'save the planet' - it just moves the emissions to another part of the planet - more often than not, China.

In the height of irony, we have regulated our coke processing industry almost out of business, and now we have filed a formal complaint with the WTO to force China to export more coke to the USA. Of course, China has no such emission controls on their coke processing. Chinese air is almost unbreathable, but we can feel good about improving American air quality, I suppose.

We are 'saving' the forests of the Northwest - never mind the fact that we have more forest cover in the USA than we have in the last 100 years - but our imports of wood and wood products from China have tripled in the last 10 years. We are not reducing the number of trees cut down - we are just cutting down Chinese trees instead of American trees.

All of our environmental efforts over the last 30 or so years have had negligible positive impact on the planet. They have merely shifted the source of the damage to other countries, made us feel good, devastated manufacturing in this country, and trashed our economy.

That is the real 'inconvenient truth'.