China will stop at nothing on its quest to become the world’s next economic superpower, even if it means polluting the entire country’s environment to the point of devastation.
Over the past few years, China has demonstrated this ruthless calculus by doing just that.
Scientists recently confirmed that China is the culprit behind the mysterious continued depletion of earth’s ozone layer. Although the substance had been banned in 2010, approximately 40,000 tons of the ozone-depleting pollutant carbon tetrachloride was still being released into the atmosphere each year. A recent study revealed that illegal factories in China were secretly undermining the world’s environmental security by continuing to release the toxin into the atmosphere, despite its commitments not to.
This type of behavior is truly dangerous. China is already the single largest emitter of carbon dioxide in the world. In 2017, its emissions tallied over 9 billion metric tons, more than the United States and the entire European Union combined.
China’s pollution has been catastrophic for its own atmosphere and natural ecosystem, resulting in substantial environmental degradation. China’s infamous toxic smog is just one consequence of the country’s ecological recklessness. In some cities, like Beijing, air pollution has become so severe that some residents experience long-term health problems as a result of extended exposure to the smog.
But here is the even bigger problem: China’s ecological gamble is working out for them. By pursuing economic advancement and throwing environmental precautions to the wind, the Chinese government has stumbled upon a tragically successful model for growth. China is already on track to surpass the U.S. as the world’s largest economy in the coming years. In doing so, China will become a serious threat to America’s international sovereignty, while also serving as an unfortunate growth model for up-and-coming nations to emulate. That spells trouble, not only for the U.S., but for the entire international community.
What, then, is the U.S. to do? How can America compete with a nation that recklessly disregards its own environmental sustainability? First, we must resist the temptation to fight fire with fire. Just because China has found economic success through extensive deforestation and poisoning its own air, doesn’t mean the U.S. should follow suit. The Chinese government may view the health of its own people as expendable, but that isn’t the American way, nor should it be.
Instead, the U.S. should focus its efforts on ridding itself of the dead weight holding back the innovation of America’s energy sector. To do this, the U.S. must utilize the one major advantage it has over the Chinese economy: the extensive presence of free markets. That means we must eliminate unnecessary, outdated, and cumbersome environmental regulations which prevent our energy industry from attaining its potential.
If our goal is to eliminate harmful regulations, the Corporate Average Fuel Economy, or CAFE, standards are a good place to start. The CAFE standards regulate how far vehicles are required to travel on a gallon of fuel. While this legislation makes sense theoretically as a measure to promote fuel conservation efforts, in practice, the regulation fails dramatically.
CAFE raises the prices of all new vehicles by thousands of dollars, as car manufacturers are forced to adhere to the government’s regulatory standards. Unfortunately, these high prices prohibit lower-income individuals from purchasing newer and more fuel-efficient cars, instead settling for the older models. The result is more gasoline used as inefficient cars stay on American roads, which in turn contributes to greater levels of greenhouse emissions into the environment. Indeed, evidence suggests that these fuel economy standards make the problem they are trying to solve worse, all while costing the American economy billions in regulatory costs.
Another example of wayward environmental regulation is the Public Utility Regulatory Policies Act, or PURPA. PURPA is legislation that was passed in 1978 with the purpose of stimulating conservation and the production of renewable energy. By requiring that utilities purchase power from renewable energy sources at “reasonable rates,” the regulation sought to encourage the use of green energy sources.
Over the last 40 years, however, the energy sector has changed dramatically, and PURPA has failed to keep up. When the regulation was first enacted, virtually none of the utility-generated electricity was from renewable sources. Nowadays, renewable energy accounts for upwards of 15 percent of total energy production. Additionally, PURPA’s “reasonable” compensation rates now far exceed the market value for renewable energy. The regulation is effectively forcing the energy sector to purchase substantially overpriced electricity.
Reforming this old rule would not only save consumers billions of dollars in lower utility costs, but it would also unshackle the electricity market from dangerous distortions and perverse incentives. In its current capacity, PURPA forces our energy sector to engage in long-term, expensive contracts at no benefit to the producer or the consumer. Proper reform would reinvigorate the industry’s competitive landscape and pave the way for increased innovation, lower prices, and greater economic growth in the process.
Indeed, to compete with China’s environmental recklessness, the U.S. must embrace intelligent energy-sector reform. Rooting out counterproductive environmental regulations like CAFE and PURPA is an excellent place to start.
Sean Noble is president of American Encore.
