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The Green New Deal is happening in China – Dean Baker

Chinese electric bus (source: Flickr cc)


One of the Trump administration’s talking points about global warming is that the US is reducing greenhouse gas emissions, while those countries that remain in the Paris accord are not.

Well, the first part of this story is clearly not true, as data for 2018 show a large rise in emissions for the United States. The second part is also not accurate, as most of the other countries are taking large steps to reduce emissions.

At the top of the list is China, which has undertaken a massive push to convert to electric powered vehicles and clean energy sources.

China’s progress in this effort is truly extraordinary. In the case of electric cars, it has used a carrot-and-stick approach where it offers consumers large subsidies for buying electric cars while also requiring manufacturers to meet quotas for electric car production as a percent of their total fleet of cars. It has also invested in the necessary infrastructure, ensuring that there are a large number of charging stations which are widely dispersed across the country so that drivers don’t need to worry about being unable to recharge.

The result has been a massive increase in the sale of electric cars. Electric car sales are projected to be 1.1 million this year, almost equal to sales in the rest of the world combined. And sales are expected to continue to rise rapidly, with annual sales hitting 11.5 million in 2030. By comparison, electric car sales are expected to be just 480,000 in the United States this year, less than half the number in China.

There is a similar story in regard to solar and wind energy. China added more solar capacity last year than the rest of the world combined. In 2018 it had already surpassed the goal that it set for 2020. It is now looking to double its capacity over the next two years.

China also has almost as much wind power capacity as the rest of the world

combined. Its capacity is more than 3 times as great as in the US. However, even with the extraordinary growth in clean energy, wind and solar together still account for less than 20 percent of China’s generation capacity and less than half the amount of electricity it produces by burning coal.

Nonetheless, China’s enormous progr- ess in promoting electric cars and clean energy should tell us a great deal about the potential that exists in these areas in the US [and elsewhere]. While the economy of China has grown rapidly during the last four decades, on a per person basis its income is still less than one-third that of the US.

This means that a relatively poor nation can make massive gains in reducing greenhouse gas emissions compared with its baseline growth path. The focus on electric cars and clean energy also did not impair China’s economic growth in any obvious way.

Over the last decade, the GDP growth of China has averaged 7.9% annually. Perhaps there is a story where China’s economy would have grown even more rapidly without the subsidies and other measures designed to promote green growth, but obviously, these measures were not serious impediments if the country could still sustain one of the fastest growth stretches the world has ever seen.

If China could make such enormous progress in a relatively short period of time, surely it would be possible for the US to make comparable gains with the resources at its disposal. This doesn’t mean that the necessary reductions in greenhouse gas emissions will be costless: people will have to change lifestyles. This would include doing without SUVs and eating much less meat. But China’s success so far is an impressive example.

This brings up another issue directly related to Donald Trump’s trade war with China. One of the biggest complaints that Trump has is that China is “stealing” US technology. Most media commentators have widely endorsed this complaint.

China already spends almost as much as the US on research and development. With a much more rapidly growing economy, China is virtually certain to pass the US in research and development spending in the very near future, if it has not already done so.

Rather than spending so much effort worrying about what China is taking from the US, we should be thinking about what the US can get from China, especially in the area of green technologies where it has made such enormous progress. Rather than looking to lock up our technologies to maximize the profits US corporations get from their patent and copyright monopolies, a modern trade deal would look to maximize the flow of technology across national borders.

That would be the focus of a trade deal if there is genuine concern for economic prosperity and the future of the planet. Unfortunately, that is unlikely to be the agenda of the trade negotiators.

Source: Real World Econ Rev, 20 Jan 19

Editor’s comment: Owing to the fact that electricity in China still comes primarily from burning coal, and notwithstanding China‘s impressive growth of renewables energy technology, some are cynical about whether its long-term objective is to replace coal- powered power stations with renewable energy alternatives. However there is clear motivation to do so because China is the planet’s most heavily polluted country.

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