Western companies should be blamed for China’s pollution

When talking with Chinese friends and co-workers about the pollution levels in Nanjing (awful compared to developed countries, but decent for Chinese cities), they are quick to point out that foreign companies in China are the ones that should be blamed for the filthy air. While it is absolutely true that foreign companies are adding to China’s environmental woes, I’m not convinced they should shoulder all the blame.

Today, I’d like to start by discussing three points related to this statement, and I hope you’ll continue the discussion in the comment section below.

Production for the West

This factor is undeniable. Western consumers have benefited from the destruction of China’s environment by purchasing cheap goods. If all of our environmental standards were enforced globally (and corporations actually complied), then the price of goods would be higher.

The latest example of this can be seen in the fact that Apple’s production facilities in China have created many environmental problems while making goods far out of reach for most Chinese consumers.

The problem I have with this argument, is that the destruction of China’s environment for the sake of producing goods for the West has also benefited many Chinese by creating jobs (from migrant workers to factory owners). The pollution has been seen as a by-product of development, without questioning how it could have been avoided.

However with the slow down in the global economy, one would expect that declining demand overseas would correlate to China’s yearly carbon dioxide emissions. Instead we see China’s emissions have continued to grow during this time, as there have been massive pushes to increase domestic consumption. It turns out cheap Chinese products made in polluting factories aren’t any less attractive in Chinese Walmarts than they are in the West.

While consumers in ALL countries have a responsibility to choose environmentally responsible products, due to the explosive growth of Chinese manufacturing, it would be very difficult to buy only “green” products.

Chinese Companies

Another important point against this argument, is that China was polluted before foreign companies arrived in the late 70’s. Foreign companies work largely through or with Chinese factories, and Chinese companies are among the world’s least environmentally conscious. The idea that western corporations are doing something different than Chinese companies is ridiculous.

Let’s take a quick look at two companies operating in China that have been attacked in the Chinese press:

In Apple’s case, Foxconn is their major supplier and also their major polluter. Apple clearly should be making greater efforts to practice corporate responsibility, but Foxconn should not be absolved of wrongdoing simply because it is working with a foreign company. Yet in Chinese papers you will always see Apple taking the majority of the blame.

The same is true of the recent oil spill involving ConocoPhilips. Both Global Times and People’s Daily railed against their environmental destruction, and both failed to mention that a state owned company owned the majority share of the project.

While blaming foreign companies might be more politically palatable, it does little to address the underlying problem.

Lax Regulations

Let’s be honest, when it comes to corporations, do we really expect them to take any actions that don’t add to their bottom line?

Corporations have a responsibility to their share holders to maximize profits, and few legal responsibilities to communities beyond paying taxes. This might be a fairly negative view of corporations, but it is not surprising that companies will dump as much toxic waste into rivers, and spew as much carbon into the air as governments will allow (if it is profitable).

While cheap labor is often cited as a reason for companies moving to developing countries, lax environmental standards are another major factor.

For example, in Nanjing there is a large chemical factory owned by a German multi-national that is often blamed for the smog in the air. The question I always pose to my Chinese friends is, “Why didn’t they build this factory in Germany?” The reason being that environmental regulations in Germany would make this kind of processing plant incredibly expensive to run. The Nanjing gov’t invited the company here because it would increase local GDP.

This is the major underlying problem. The pursuit of local GDP development (in return for promotions) has essentially aligned the interests of local government leaders with those of corporations, instead of the people they supposedly represent. While the Central government has created CO2 emissions targets and other environmental incentives, local leaders still recognize the fact that the key to promotion is GDP.

Perhaps the most troubling example is Huaxi (read my series on the richest village in China), instead of being condemned for it’s reliance on dirty industries like fertilizer production and steel, it has been lifted up as a national model of excellence.

Even in cases where factories have been “shut down” for violating the already lax environmental regulations, they are frequently allowed to continue their operations until people end up in the hospital (numerous examples of lead poisoning from “closed” factories have surfaced in the last year).

If local governments encourage the creation of heavily polluting industries, than they too must shoulder some of the blame for the resulting mess.

Ultimately, even if every multinational pulled out of China tomorrow, there is little evidence that this would actually bring an end to China’s pollution problems. Certainly the West is benefiting from this environmental destruction, but to pretend that this disaster is not largely of China’s own making ignores the reality of the situation.

For unbelievable photos of China’s environmental devastation and the toll it takes on China’s people check out this post from ChinaHush.com

42 responses to “Western companies should be blamed for China’s pollution”

  1. Excellent fair unbiased analysis. I was in China in the early 80’s,Chongqing,for example was extremely polluted even then.I could go on but i type w/ one finger,and it’s running out of ink. Have a great Thanksgiving,mike dunn

  2. Lorin Yochim says:

    The analysis could be made stronger if the nation-state were not the primary unit of analysis and if the idea of exploitation were brought into the picture. Even comparing specific companies seems inadequate to the task of understanding what is at stake in the game of pollution offshoring. I’d suggest a class analysis that considers which groups benefit and which not under these practices and conditions.

    • Actually,Lorin,if you want to cut to the chase,the whole ‘nation-state’ concept is flawed.A global corporatocracy runs the world,overseen by a ‘power elite’/’high cabal’.good writing though,you get an ‘A’ for that.

      • Lorin Yochim says:

        I suppose we ought not to go on at too much length on Tom’s blog, but I’ll agree with you to an extent. I’m not saying that the state doesn’t matter, because interstate competition and race to the bottom policy making is key as well. But too much synecdoche leads us down the garden path to the nowhere land of “in this country it’s like this; in that one it’s not.” That stuff is singularly unhelpful.

      • Lorin:who r u,where r u,and what do u do/want to do. i am curious. will b in china in Feb. xie xie,ciao 4 now,mike

      • Lorin Yochim says:

        I think if you click on my photo rather than my name, you should find all of my contact info there. Alternatively, try http://vocationoftheheart.wordpress.com. Cheers.

    • Tom says:

      As always Lorin, you bring up the much bigger point (it seems many of your comments are worthy of an entire dissertation). In this case though the problem is the idea that pollution is an aspect of “foreign companies” instead of realizing that it as an attribute of all companies.
      Pollution offshoring is a very real problem, but who is ultimately responsible for shouldering the blame, the company that creates the pollution, the governments who allow pollution, or the consumers who buy the products of this system? The fact that developed countries have managed to offshore their worst polluters is not just a symptom of capitalism, but is also a symptom of dictatorships that have few responsibilities to their people.
      In this very brief rebuttal, I would argue that if capitalism is the problem, than instead of socialism, communism, or some yet unknown economic system being the answer, perhaps the solution to these capitalist problems is democracy.

      • Lorin Yochim says:

        Many very big points, some that I agree with, others not so much. I’ll leave the final word to Giovanni Arrighi: “This, of course, does not mean that socialism is alive and well in
        Communist China, nor that it is a likely outcome of social action. All it means is that, even if socialism has already lost out in China, capitalism, by this definition, has not yet won. The social outcome of China’s titanic modernization effort remains indeterminate, and for
        all we know, socialism and capitalism as understood on the basis of past experience may not be the most useful notions with which to monitor and comprehend the evolving situation” (from Adam Smith in Beijing, 2007, p. 24).

  3. mopedchi says:

    My friend (American born Chinese) runs a small materials company in China. They have been asked by an American company to produce materials that contain cadmium, which can cause cadmium poisoning. It’s either impossible or cost prohibitive to produce the same material in the US due to environmental regulations. In China, there are either no regulations or no one cares, including the responsible government agencies.
    In the factory, the workers are provided safety equipment (masks, gloves, ventilation) but often they don’t use them in an attempt to save money. My friend spends a lot of time trying to convince local manager and workers that it’s not a “waste of money” to follow good safety precautions.
    So I agree with Tom, the problem has many causes and placing all the blame on foreign companies is a bit simplistic. Companies will always look to minimize costs, regardless if they are Chinese or non-Chinese owned. The solution will depend on adherence to the rule of law in China which is a political, rather than economic, discussion.

    • BB says:

      This caught my eye: “In the factory, the workers are provided safety equipment (masks, gloves, ventilation) but often they don’t use them in an attempt to save money.”

      Could you elaborate on this? I don’t quite understand why the workers feel that not using these materials would save money as the materials are provided to them at no cost to themselves. I get that local managers might leave them by the wayside to save money for the company, but why would the workers themselves do the same?

      • mopedchi says:

        It’s not a large company and the factory is not running at full capacity. My guess is that there may be local management pressure not to spend money but the company is a WOFE (wholly owned foreign entity) and all the funding comes from outside of China. There is no foreign management pressure to cut costs (yet); the main focus is R&D and ramping production.

        Rather, when we talk to the workers, they are proud that they don’t spend money and come up with DIY solutions to problems. Some of it comes back to bite them in the ass, such as using substandard packaging materials… who ships out US$5000 products using recycled/reused boxes? Not exactly sure if it’s the overall culture in China/Chengdu or just the company but sometime they go overboard on not spending money where it’s needed.

        Perhaps they think by saving money they increase the chance of financial success of the company. If the company goes under, they lose their jobs. Also, my friend has given all the workers some stock options (not a lot) which is rare in China. It was difficult (and funny) trying to explain stock options to factory workers. Maybe some of them are thinking like shareholders.

    • Meryl Mackay aka 马美丽 says:

      And as TheNakedListener has comprehensively explained to us, there is no Rule of Law in China, only Rule By Law. I have been following Tom’s wonderful Blog all this year, shortly after he commenced it. I have learned so much from the comments posted and enjoyed reading them all, even the unhelpful ones.

  4. Jin Zhao says:

    “The pollution has been seen as a by-product of development, without questioning how it could have been avoided.” Pollution can be avoided, technically. But in reality, I would argue it’s a necessary by-product of capitalism, which is by nature aggressive to nature and exploitive.

    • Tom says:

      I think it’s a by-product of any economic system. In fact many of the socialist countries were far less efficient in using their resources. With N. Korea as a current example, the amount of carbon dioxide released to create a unit of GDP is several times higher than China’s.
      While all corporations (private or state owned) seek profit, it can also be in their interest to use resources responsibly when green options become cost effective through legislation and research.
      China is one of the least efficient countries when it comes to GDP/CO2 emissions http://en.wikipedia.org/wiki/List_of_countries_by_ratio_of_GDP_to_carbon_dioxide_emissions

  5. In reply to BB’s comment

    This caught my eye: “In the factory, the workers are provided safety equipment (masks, gloves, ventilation) but often they don’t use them in an attempt to save money.”

    I can only report on what I’ve seen in the five or six factories I’ve visited (stone cutting, garment maufacture, textiles, wood-turning, metals workshops). For the workers I’ve met it’s not a cost-saving issue, but a lack of understanding of the clear benefits of using safety equipment vs the hassle factor of using it. There is little or no Occupational Health and Safety education, and OHS rules are rarely enforced by management. And of course, no regular OHS inspections.

    It seems obvious to us to use safety goggles when grinding metal, and earplugs when using a jackhammer. They’re sitting on the ground next to you – why not use them? Couldn’t be bothered, is often the reply.

    One of the unforseen benefits of foreign investment in Chinese production has been the insistence by many foreign companies on certain standards of safety in the factories where their goods are being manufactured. It’s a start, but is still far from the norm.

    Thanks again Tom for a thought-provoking piece.

  6. Someone thinks this story is fantastic…

    This story was submitted to Hao Hao Report – a collection of China’s best stories and blog posts. If you like this story, be sure to go vote for it….

  7. Tom says:

    Story just today in the People’s Daily detailing two Chinese chemical factories operating without proper licenses in villages that have had sudden spikes in cancer rates http://english.peopledaily.com.cn/90882/7646980.html

  8. Hugh Grigg says:

    “The question I always pose to my Chinese friends is, “Why didn’t they build this factory in Germany?” ”

    Insightful point, that’ll be a very useful angle for me in this kind of discussion.

  9. Chuck says:

    The world’s two most polluting industries, at least in terms of carbon dioxide emissions, are steel and cement. China produces two thirds of the world’s crude steel and 54 percent of its cement. Most of this is used domestically in fixed asset investments which comprise nearly half of China’s GDP. These are highly protected industries with little foreign involvement.

    Here, China has no one else to blame but itself.

  10. Sascha says:

    Panzihua in southern Sichuan made a concerted effort to court Ruhr Gebiet industries after Germany turned the coal belt into a green belt. Much of their marketing revolved around taxes and lax environmental regulations. There are 10,000 Panzihuas in China.

    If you have been to most any village in China (or any suburb for that matter), you will notice that rivers double as landfills. Environmental awareness across the nation hovers just above zilch until people start dying of cancer.

    Foreign companies take advantage of this ignorance, indifference, greed and downright callous lack of humanity in order to turn a larger profit. If home nations (manage to) legislate their companies out of China due to environmental issues, they will go to Cambodia or the nations will succumb as the companies leave or the competition buys them up. This is provided that a company is beholden to a home nation at all.

    The rise of a worried middle class will help to bring about the mindset needed to make a dent into pollution in China, but we are talking about a massive undertaking. No nation on earth is more polluted than China and there is at least another five years, perhaps as much as a decade, to go before the country stops building to keep growth rates up. That’s a lot of cement, a lot of steel.

    Assigning blame to others is what the CCP is good at and for those of us living in China and worried about early cancer, look to grassroots farming and sourcing; investment in water purification and, eventually, an exit strategy.

    • Lorin Yochim says:

      This is a good comment. The facts, I would say, are dead on. However, as I suggested above, I think that we could put a sharper edge on the comments on environmental pollution and awareness, as well as the prospects for change, by considering more carefully matters of status and class.

      First, pollution is a massive problem in China that affects all residents, but it is important to recognize that there is an internal economy of exposure to pollution. This fact is, I think, implicit in Sascha’s comments about villages and their rivers. No one is overly impressed with Beijing’s “waterways,” but they are not garbage dumps. Here we see evidence of perhaps the most important class divide in China, i.e., the rural-urban divide. Of course this divide is reproduced even within Beijing when one moves from the relatively pristine waters of the old city to the counties cum districts like Changping in the north.

      Second, the focus on Beijing in both the Chinese national and foreign press (and blogosphere, of course) disguises something that many commenters here are well aware of: that pollution situation in Beijing is not so bad compared to many provincial capitals and smaller municipalities around the country. “Not so bad” being not so good merely underlines the serious problem residents of China deal with every day. Access to a (relatively) clean environment also runs along an axis defined by China’s tiered cities.

      Third, with regard to the potential role of a worried middle class to improve the situation, well, that remains to be seen. My own take is that the optimism people feel about the rise of the middle class as a political force has more to do with projecting a faulty ideological history of the democratization of the West onto a country with its own peculiar history and conditions. Put simply, there are just as many reasons to be pessimistic about the development of an activist middle class as there are reasons to think their on line tweets are evidence of an uprising in the making. In terms of the capacity and resources for critique of the government, China’s peasant/rural and working class are not the dupes they are usually taken for. Have a look at the comical image of the angry vendor girl in the “ugly americans” post on this blog. Note how her feisty response is seen as ignorance and stupidity. It is seen as an indication of the sheep-like behaviour of an unthinking, uneducated “girl” (I’ll not go on about the sexist, classist ignorance of these comments here…unless challenged). Sure it is partly ill-aimed nationalism, but it is also a refusal to be dominated. I would suggest that it is also evidence of the legacy of a more revolutionary time. This will not be a popular view for those readers who believe that the revolution consisted of Mao standing at a lectern commanding robot-like supplicants to do his deeds.

      Anyway, and here I speculate in the extreme, if one feels that the Party needs to go, and that systems of the kind suggested at the tail end of Sascha’s comment is the way to go, one ought to pay more attention to the potential of actors other than the new middle class to bring about its demise. The Party’s rhetoric and policy under Hu Jintao certainly suggests that the Party recognizes this. If, on the other hand, you are interested in maintenance of the capitalist/market system, the best thing for you is the continued rule of the CPP. If this occurs, it is most likely to do so through the consolidation of a power block comprising the Party and elements of the so-called middle class. The result, perhaps, will be the rise of a pseudo-democratic and highly unequal (in terms of income, wealth, pollution etc. distribution) state.

  11. E Fertik says:

    The argument that non-Chinese businesses or consumers should be “blamed” for Chinese pollution seems to rely on an assumption that the primary goal is the well-being of Chinese people. Foreign companies come to China to make money; foreign consumers buy Chinese made products to save money. If other factors are to be considered, it is up to Chinese to see that this happens–through regulation and enforcement.

    If Americans lose jobs when manufacturing is moved to China, it this something Chinese should worry about?

    • Lorin Yochim says:

      I suppose it depends on who you see “Chinese” to be. Is it only the CPP as policy makers? Must people’s primary loyalties always be to the state and its pronounced goals? When jobs move from the US to Mexico, can’t workers there take the jobs AND feel solidarity with those in the US who lost their jobs? Can’t coal workers in China find something in common with and forge links with those in US activists fighting mountain top removal? Or with Chilean miners trapped underground?

      As in Tom’s comment above, it’s very helpful to tease out the assumptions we smuggle in to phrases like “the Chinese” and “China.”

      • Meryl Mackay aka 马美丽 says:

        I think that most working citizens of the PRC are too busy meeting their own needs to worry about workers elsewhere in the world. Even retired people with time on their hands are more likely to research their own past and culture than look outwards to the global community.

      • Lorin Yochim says:

        Likely true, Meryl, though one ought to recognize that it hasn’t always been this way. And I suspect that you are right about the retired, as the example of my father in law shows. I just mean to point out that the way things are needn’t be seen as the way things must be.

    • imikespock says:

      good point,EF. gotta run right now but’I’ll b back. best,mike dunn

  12. BILL RICH says:

    Are foreign firms encouraged to interfere into China’s internal environmental affairs now ? When can we interfere into China’s human rights problems ? Love to.

    May be the best solution is for all foreign firms to buy their stuff from India or Vietnam instead. And then these firms will not need to interfere with other country’s internal affairs.

  13. imikespock says:

    Chinese businesses are already in Viet Nam. wages there are 49 cents/hour.next stop,bangladesh.

  14. Normally I thoroughly enjoy Tom’s perspective on China, but he is way off base on this issue.

    Western multinational are using lax environmental laws created by Chinese policy makers, the only people who are to blame for pollution in China are Chinese law makers.

    Multinationals when confronted with this issue should tell China to look in the mirror and quit whining or change their laws.

    • Tom says:

      I hate to say this, but it doesn’t seem like you got much past the headline. Most of the post is about why this blame lays largely on Chinese shoulders.

    • Chopstik says:

      And I suspect that China actually has relevant laws dealing with the environment. The problem isn’t the laws themselves but the application thereof. And, as pertains to that issue, it is not just the environment that suffers.

  15. Jared Wood says:

    what in the heck did i just read? that is how you end it? I’m sorry, but that is not a conclusion anyone is looking for. No-one is benefiting from the pollution it creates because it is seen world-wide. every automobile, every manufacturing plant, and every bare spot on earth contributes to the heat and destruction we receive today and tomorrow from our good sun. soon we will lose our very oxygen supply that is the most important resource of biochemical fuel we have. your just short of having them actually take responsibility 😀

  16. I’m following up this cancer village issue in the Yunnan province recently, and the situation there is terrible, if you are interested: http://www.sbs.com.au/dateline/story/watch/id/601459/n/China-s-Cancer-Villages
    I’m really worried about the pollution back in my country. I’m a Chinese, now study in Australia. I mean it is the result of the lax of regulation, and the overload manufactories in China. But it is impossible to draw the government attention from developing economy to environment issues, and what happened down in south possibly can’t be acknowledged by the central government.
    I’m writing on a news report on this issue, and read through loans news report, all pointing the figure to the government, but I do think international manufactory also need share some responsibility, what do you think?

    • Tom says:

      I think they do share some responsibility, but as I say in my opening paragraph, they shouldn’t shoulder all of the blame. The villages I visited that needed drinking water projects had all been polluted by mining in the 60’s prior to opening up. I think there has also been little discussion of the role multinationals have played in providing new manufacturing process to China that are greener than what was in place before opening up. A good reference point would be Mao’s Great Famine, which discusses China’s environment during the great leap forward.

      • Thank you for the reference, I’ll get this. There is a lot pollution during the great leap forward, according to what I learnt in my history class. But since the open up, the environment pollution didn’t been paid as much attention as the the cyber pollution, which is definitely a negligent of my government. It has also result the serious cancer village issue in the rural place.

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