4 ms·

China and the EU can, and should. "Polluter pays" should become the standard policy in international trade in numerous other ways, too.

arethuza 6y ago
Well, as an unhappily former EU citizen I don't think getting into arguments at all is an option for the country I live in. :-(
Ekaros 6y ago
Wouldn't "user pays" be more logical. I think it is quite dishonest to blame China when consumption happens in Europe or USA... All of the pollution should be transported in calculations where consumption happens.
- giantg2 6y ago
  Then you would be charging people who have no control over the production. The producer nation sets the laws and standards for their facilities.
  - Ekaros 6y ago
    They do have the option to pick up option that has less attached taxes. Or not to buy something.
    - giantg2 6y ago
      Who imposes the taxes then? The exporting country (China) is unlikely to do it. The importing county is only likely to do it if the government and people support it. The problem is that even with a tax on the import, polluting in a developing nation would likely be cheaper than not polluting anywhere else. Many items do not have options to buy from various countries (economies of scale usually consolidate factories and leave little room for competitors). Not to mention that drastically reducing consumption (your comment about not buying) will cause most economies to fail since we are consumer based.
      - mantas 6y ago
        Make taxes big enough to make pollution too expensive even in cheap countries? Buying less, but more expensive because of less polluting manufacturing methods is the answer. Economy will still keep going.
        giantg2 6y ago
        "Economy will still keep going." How so? If you are adding crushing taxes, then you're likely to see a downturn in production and consumption, which generally results in a weak or shrinking economy.
        mantas 6y ago
        Polluting taxes will promote spending on less polluting ways to manufacture. Or better quality goods that put out same amount of pollution, but you end up buying them not as frequently. Let's take a hipothetical sweater as an example. Now I buy a €20 sweater every 2 years. Let's say pollution tax would be €10. Suddenly it becomes €30 sweater and my €10/year sweater budget becomes €15/year. Instead, I could buy a nice sweater for €40 (+€10 tax) and wear it for 5 years. Now I'm back at original €10/year budget. Economy wise, most of the chain is now just making nicer stuff that takes more resources. Aside from truck driver. Who is now moving twice as much sweaters. But €10 tax ideally would go to environment-improving projects and some drivers will make a living in those new sectors.
- mschild 6y ago
  To a certain extend, absolutely. Much of the richer EU states cause and have caused quite a bit of pollution and without a serious shift in consumption, I don't believe we can achieve our goals. However, industry is without a doubt a massive resource user. Modern methods in manufacturing can save significant amounts of energy, water, and more. As China is the main producer in many instances, a change also needs to happen there to go from heavy polluting to less polluting methods.
- mantas 6y ago
  At the end of the day, it's always "user pays".
- DFHippie 6y ago
  When China bids to manufacture something for the world market, a variety of things go into the price they can bid: labor, shipping, materials, and pollution, chiefly (there is also research, facilities maintenance, etc). The main factors which give them an advantage are labor and pollution. Their labor advantage is internal but their pollution advantage -- the portion dumped into water or air -- they get by extracting value from a shared account. In countries with stricter pollution laws companies can't rob their neighbors to win a bid. That being said, tariffs and other mechanisms meant to force the pollution cost back onto producers really end up being paid largely by consumers anyway. You can't tax citizens of another country. So the tariff taxes citizens of your own country. The cost gets back to the producer country indirectly in that they sell less stuff, but every time the tax is paid it is paid inside the country imposing the tariff by citizens of that country. So it works more or less according to your suggested mechanism.
- Sharlin 6y ago
  The end result should be largely the same regardless of whether the externality compensation takes the form of an import tariff or user-facing retail tax. Either way customer prices rise and manufacturer/importer/seller margins drop. Tariffs are a blunt tool, but so are most consumer-end taxes as well. But coming up with the sort of Pigovian precision instrument, that attempts to fairly reflect the actual lifecycle externalities of a good or a service, is probably going to be almost impossible for several reasons.
- nraynaud 6y ago
  it's the same thing, the tax increases the price for the buyer.
justin66 6y ago
Imposing tariffs based on pollution is already GATT-legal. AFAIK it's something countries avoid for all the other reasons why countries avoid tariffs.
hackerNoose 6y ago
China is the biggest polluter and they plan to increase their co2 emissions to at least 2030 so I don't think you'll find an ally there.
- Gwypaas 6y ago
  China already leveled off in 2011. https://ourworldindata.org/co2/country/china?country=USA~IND~CHN~NGA~ETH https://ourworldindata.org/co2/country/china?country=USA~IND...
- La1n 6y ago
  Big polluter because it's a giant country. Per capita it's quite low, and there is no reason a big country should be punished why a smaller country that does significantly worse shouldn't. According to that logic if they would split into lots of smaller countries it suddenly isn't an issue anymore.

arethuza 6y ago

Well, as an unhappily former EU citizen I don't think getting into arguments at all is an option for the country I live in. :-(

Ekaros 6y ago

Wouldn't "user pays" be more logical. I think it is quite dishonest to blame China when consumption happens in Europe or USA... All of the pollution should be transported in calculations where consumption happens.

giantg2 6y ago
Then you would be charging people who have no control over the production. The producer nation sets the laws and standards for their facilities.
- Ekaros 6y ago
  They do have the option to pick up option that has less attached taxes. Or not to buy something.
  - giantg2 6y ago
    Who imposes the taxes then? The exporting country (China) is unlikely to do it. The importing county is only likely to do it if the government and people support it. The problem is that even with a tax on the import, polluting in a developing nation would likely be cheaper than not polluting anywhere else. Many items do not have options to buy from various countries (economies of scale usually consolidate factories and leave little room for competitors). Not to mention that drastically reducing consumption (your comment about not buying) will cause most economies to fail since we are consumer based.
    - mantas 6y ago
      Make taxes big enough to make pollution too expensive even in cheap countries? Buying less, but more expensive because of less polluting manufacturing methods is the answer. Economy will still keep going.
      - giantg2 6y ago
        "Economy will still keep going." How so? If you are adding crushing taxes, then you're likely to see a downturn in production and consumption, which generally results in a weak or shrinking economy.
        mantas 6y ago
        Polluting taxes will promote spending on less polluting ways to manufacture. Or better quality goods that put out same amount of pollution, but you end up buying them not as frequently. Let's take a hipothetical sweater as an example. Now I buy a €20 sweater every 2 years. Let's say pollution tax would be €10. Suddenly it becomes €30 sweater and my €10/year sweater budget becomes €15/year. Instead, I could buy a nice sweater for €40 (+€10 tax) and wear it for 5 years. Now I'm back at original €10/year budget. Economy wise, most of the chain is now just making nicer stuff that takes more resources. Aside from truck driver. Who is now moving twice as much sweaters. But €10 tax ideally would go to environment-improving projects and some drivers will make a living in those new sectors.
mschild 6y ago
To a certain extend, absolutely. Much of the richer EU states cause and have caused quite a bit of pollution and without a serious shift in consumption, I don't believe we can achieve our goals. However, industry is without a doubt a massive resource user. Modern methods in manufacturing can save significant amounts of energy, water, and more. As China is the main producer in many instances, a change also needs to happen there to go from heavy polluting to less polluting methods.
mantas 6y ago
At the end of the day, it's always "user pays".
DFHippie 6y ago
When China bids to manufacture something for the world market, a variety of things go into the price they can bid: labor, shipping, materials, and pollution, chiefly (there is also research, facilities maintenance, etc). The main factors which give them an advantage are labor and pollution. Their labor advantage is internal but their pollution advantage -- the portion dumped into water or air -- they get by extracting value from a shared account. In countries with stricter pollution laws companies can't rob their neighbors to win a bid. That being said, tariffs and other mechanisms meant to force the pollution cost back onto producers really end up being paid largely by consumers anyway. You can't tax citizens of another country. So the tariff taxes citizens of your own country. The cost gets back to the producer country indirectly in that they sell less stuff, but every time the tax is paid it is paid inside the country imposing the tariff by citizens of that country. So it works more or less according to your suggested mechanism.
Sharlin 6y ago
The end result should be largely the same regardless of whether the externality compensation takes the form of an import tariff or user-facing retail tax. Either way customer prices rise and manufacturer/importer/seller margins drop. Tariffs are a blunt tool, but so are most consumer-end taxes as well. But coming up with the sort of Pigovian precision instrument, that attempts to fairly reflect the actual lifecycle externalities of a good or a service, is probably going to be almost impossible for several reasons.
nraynaud 6y ago
it's the same thing, the tax increases the price for the buyer.

justin66 6y ago

Imposing tariffs based on pollution is already GATT-legal. AFAIK it's something countries avoid for all the other reasons why countries avoid tariffs.

hackerNoose 6y ago

China is the biggest polluter and they plan to increase their co2 emissions to at least 2030 so I don't think you'll find an ally there.

Gwypaas 6y ago
China already leveled off in 2011. https://ourworldindata.org/co2/country/china?country=USA~IND~CHN~NGA~ETH https://ourworldindata.org/co2/country/china?country=USA~IND...
La1n 6y ago
Big polluter because it's a giant country. Per capita it's quite low, and there is no reason a big country should be punished why a smaller country that does significantly worse shouldn't. According to that logic if they would split into lots of smaller countries it suddenly isn't an issue anymore.