Deja Vu all over again

A theme that's emerged in both our podcast interviews is the one step forward, two steps back character of climate action by the US federal government. Nixon set up the EPA in 1970 (imagine a republican creating an environmental agency!) and the OPEC oil crisis hit in 1973, both of which must have created widespread concern about overdependence on oil, especially middle east oil. There was a flurry of investment in renewables - both basic research and commercial incentives - during the Carter administration which diminished when Reagan came to power. Seems familiar doesn't it?

Of course, there's no doubt that much has been achieved since then - the rivers are cleaner, the air is much less polluted, LA doesn't have the smog that it had then and so on. But I also wonder how much of that is tied to economic trends that outsourced environmental degradation to other countries, especially China? 

Take a look at the figure - in 1970, when the EPA was established, US per capita emissions were 21.11 metric tons per capita. China's was more than twenty times less - only .94 metric tons per capita. In 2013, the US was 16.39 metric tons, while China's was 7.55, a little less than a half of the US. 

A lot of that shift from a factor of twenty to a factor of 2 has got to be (I say "got to be" because I haven't done the research) due to China becoming the manufacturing hub of the world, a position that was the US's in 1970. As we all know, jobs follow the factories, which meant more Chinese workers and fewer manufacturing jobs in the US. And now the US has a president who wants to end that job loss and end climate regulations. So here are my questions: 

  1. How much of a role did stricter environmental regulation play in companies relocating? 
  2. How much of Trump's anti-climate rhetoric is really a coded signal to his supporters that this is how he plans to get manufacturing back?




Curt Newton's picture

I share your sense, Rajesh,

I share your sense, Rajesh, that many countries like the U.S. take advantage of outsourcing manufacturing emissions to China and other developing countries.

Sad to witness simultaneous bragging about reducing national emissions and casting blame on one's production partners for their rapid emissions growth. But in terms of magnitude, I think outsourcing has so far mostly been a matter of pure cost economics (and global trade liberalization) moreso than a race to the environmental bottom.

Here's some actual research on emissions outsourcing. 

From Brad Plumer, "A closer look at how rich countries “outsource” their CO2 emissions to poorer ones," (Vox April 18, 2017):

  • "During the early 2000s, these “emissions transfers” were growing at a stunning pace, nearly 11 percent per year, as more and more Western manufacturing was shifting to Asia."
  • "In China, roughly 87 percent of the steel and 99 percent of the cement produced is consumed domestically. The vast bulk of the country’s climate pollution isn’t being driven by foreigners; it’s being driven by domestic growth. In fact, one notable trend in China is the outsourcing of emissions within the country’s own borders...China’s richer coastal provinces tended to consume a lot of goods made in the poorer inland provinces."

And from Yue Maggie Zhou, "When some US firms move production overseas, they also offshore their pollution" (The Conversation, May 18, 2017)

  • "One recent study calculates that 17 to 36 percent of four major air pollutants emitted in China come from production for export. Among these export-related emissions, about 21 percent come from the production of goods for the United States."

What to do about this? Many carbon pricing proposals include border taxes on the emissions footprint of imported goods, so that imported good don't get a free ride. But these adjustments are easier said than done. We have a long way to go to create trustworthy emissions footprint data about all our stuff, to say nothing of the political will needed to put carbon pricing policies in place.

Mark Brown's picture

This a very interesting angle

This a very interesting angle. Increased carbon output follows wherever manufacturing moves. As we offshore industrial production, we export externalities.

Something I found so surprising when I recently went back to Carter's so called "Crisis of Confidence" speech to the American People, was how different it sounded to my 2017 ears, compared to how it's been characterized by popular history.

My interpretation of this speech today  -- which is a very interesting 30 minutes to watch -- is that Carter was actually laying the groundwork for an American vision of energy independence and a sustainable future. The only "crisis of confidence" was that it was going to be a difficult transition. 

Hearing his words today -- and admittedly I'm cherry-picking here, because there's a lot of pushing coal throughout this speech to reduce dependence on middle eastern petroleum -- he sounds prescient (his plan gets unveiled at around 19:00 minutes):

"To give us energy security, I am asking for the most massive peacetime commitment of funds and resources in our nation’s history to develop America’s own alternative sources of fuel -- from coal, from oil shale, from plant products for gasohol, from unconventional gas, from the sun.

I propose the creation of an energy security corporation to lead this effort to replace two and a half million barrels of imported oil per day by 1990. The corporation will issue up to five billion dollars in energy bonds, and I especially want them to be in small denominations so average Americans can invest directly in America’s energy security.

Just as a similar synthetic rubber corporation helped us win World War II, so will we mobilize American determination and ability to win the energy war. Moreover, I will soon submit legislation to Congress calling for the creation of this nation’s first solar bank which will help us achieve the crucial goal of twenty percent of our energy coming from solar power by the year 2000.


The speech is on youtube: