mark hertsgaard

Independent Journalist & Author

mark


China pumps diesel and gasoline prices

(Host intro)
For the first time since May, China is about to hike prices for diesel
and gasoline. Though Beijing is pretty heavy handed when it comes to
price controls, this move just goes to show that not even a state-run
economy can insulate itself from world markets. Commentator and writer Mark
Hertsgaard thinks China — and the rest of the world for that
matter — can
learn a lesson or two from this.

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(Mark Hertsgaard):
Double-digit annual growth rates have lifted millions of Chinese out of
absolute poverty and created a middle class larger than entire European
nations.

But a time bomb is ticking inside China that threatens to undo all
this. Worse, the same bomb lurks within most of the world’s economies,
including ours.

Standard ways of calculating market prices are environmentally blind.
They measure economic output and consumption but ignore the associated
environmental costs.

China is growing at the expense of truly awesome environmental
sacrifice. Factories and highways have blanketed farmland and forests.
Coal makes electricity to power new refrigerators but also creates the
world’s worst pollution.

The World Bank has calculated the costs of China’s air and water
pollution at 7 percent of its GNP. Other estimates put those costs at
10 to 15 percent of China’s GNP.

In short, China’s economic growth is being cancelled out by its
environmental damages. Sure, the economy is running hard, but it’s
poisoning its own future. And since market prices don’t reflect these
costs, most people think everything is fine.

We use the same flawed accounting system here in the United States. In
California, for example, consumers pay about $2 a gallon for gasoline.

But Terry Tamminen, the state’s Secretary of the Environment, says
that’s a false price. It leaves out the health care costs related to
the pollution gasoline causes and the lost productivity due to traffic
jams.

Secretary Tamminen estimates the social costs of gasoline in
California at between $20 and $50 billion a year. If the market price
reflected those costs, he says, consumers and producers would act
differently—by driving less, by producing more fuel-efficient vehicles.

Yes, prices at the pump would be higher, but they would be
environmentally honest prices.

And that would spark the market’s genius to help society as a whole,
whether in China or the United States, to avoid unprecedented
peril.

In San Francisco, this is Mark Hertsgaard for Marketplace.

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About Mark

Independent journalist Mark Hertsgaard is the author of seven books that have been translated into sixteen languages, including Bravehearts: Whistle Blowing in the Age of Snowden; HOT: Living Through the Next Fifty Years on Earth; and A Day in the Life: The Music and Artistry of the Beatles. He has reported from twenty-five countries about politics, culture and the environment for leading outlets, including The Guardian, Der Spiegel, Vanity Fair, The New Yorker, Time, Mother Jones, NPR, the BBC and The Nation, where is the environment correspondent. He lives in San Francisco.

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