Who will pay for the costs of foreign carbon dioxide in our consumer goods?

I discussed in this post the problem of GHG emissions from imported consumer products.  We import and buy more and more goods from China and other countries that rely heavily on greenhouse gas-intensive coal-fired power.  As a result, our consumer habits are responsible for a large and growing proportion of GHG emissions in other countries.   These GHG emissions aren’t included in US GHG inventories, as evidenced by the sources cited in my prior post.  At what point in the lifecycle of these products will the costs of carbon dioxide emissions be internalized?  New York Times columnist Paul Krugman wrote today about this problem in an op-ed essay about the critical role of China in addressing future greenhouse gas emissions.  From his column:

[T]he Chinese also insisted that they should not be held responsible for the greenhouse gases they emit when producing goods for foreign consumers. But they refused to accept the logical implication of this view — that the burden should fall on those foreign consumers instead, that shoppers who buy Chinese products should pay a “carbon tariff” that reflects the emissions associated with those goods’ production. That, said the Chinese, would violate the principles of free trade.

Sorry, but the climate-change consequences of Chinese production have to be taken into account somewhere. And anyway, the problem with China is not so much what it produces as how it produces it. Remember, China now emits more carbon dioxide than the United States, even though its G.D.P. is only about half as large (and the United States, in turn, is an emissions hog compared with Europe or Japan).

Unfortunately, Krugman is right.  No matter how much the U.S. reduces its own GHG inventory, this will be an enduring problem.  An about-face in Chinese energy production methods is extremely unlikely; though Chinese coal plants are getting more efficient, they are still increasing rapidly in number.  Free-trade rhetoric seems to make it politically very difficult to implement a tariff.  And U.S. consumers don’t seem likely to change our consumption habits voluntarily without strong price signals that would discourage consumption of goods produced overseas through cabon-intensive processes.  

This dynamic makes me very pessimistic about reducing carbon dioxide emissions to anywhere near the necessary levels to mitigate global climate change.  Any ideas?

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Reader Comments

3 Replies to “Who will pay for the costs of foreign carbon dioxide in our consumer goods?”

  1. Ultimately, I think the responsibility lays upon the producers of the products when it comes to GHGs because it is they who can significantly alter the amount of GHGs produced. However I see how the consumers of the product are technically guilty for the demand of the creation of products, and I agree that consumer consumption probably won’t change very easily.

    If China won’t reduce its GHGs, I think the US should pursue other nations as means of production, using (increasing or reducing) economic incentives or subsidies to encourage production in other nations that go for US goal reductions. However this would ultimately require the US government to take on formal goals of reducing GHG and could possibly stress our already hurting economy.

    Another solution could possibly be the creation of a “green” product standards, similar to the LEED building standards, that would rate the “greenness” of a product, and maybe this could create an economic pull towards green products and thus would encourage companies and their factories (in nations including China) to reduce GHGs while increasing environmental production approaches. This method seems the least strenuous on the US economy while providing a way to help guide consumer choices and encourage more environmentally friendly development.

  2. One idea: Sue the bastards.

    If it’s good for the Detroit goose, it may be good for the Chinese gander. Even under a very conservative view of personal jurisdiction, California should be able to establish jurisdiction over the companies delivering Chinese goods into California ports. Of course, that doesn’t account for the growing emissions involved in China’s production of goods to export to other countries, or for domestic production, but it’s worth considering.

  3. Hey nemesisofevil,

    Sue who? and for what? Chinese companies, hired by American companies, providing a supply of goods to meet the American consumption demands? Maybe I’m misunderstanding something?

    I think California can regulate what goods are coming in to California, but we definitely can’t establish jurisdiction on the companies importing to us, especially if they are Chinese, otherwise any country could establish jurisdiction over any foreign company (the US included) doing business on their soil.

    I like the general idea though. But it’d have to be a national effort, because regulating in just California would just mean that they drop their goods off in Oregon or Washington and truck them down to us. Also, creating more rules and sanctions on goods from China would probably get many American business angry and also risk retaliation from China in the form of its own sanctions or restrictions against importing US goods/materials.

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About Sean

Sean Hecht

Sean B. Hecht is the Co-Executive Director of the Emmett Institute on Climate Change and the Environment, Evan Frankel Professor of Policy and Practice, and Co-Director o…

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