Caixin
Jan 05, 2017 07:05 PM
ENVIRONMENT

Opinion: Smog Poses Long-Term Threat to Economies of Large Cities

The bouts of smog that have frequently shrouded Beijing and northern China have prompted me to ponder what will happen to the capital and other large cities in the north if toxic air becomes the “new normal” in these places.

If smog is medically proved to be the leading cause of many medical conditions such as lung cancer and cardiovascular disease, I think people living in large cities will move to smaller towns and even mountain areas where the air quality is acceptable.

Easier access to the Internet and the rising cost of living in large cities make such migration even more plausible.

Secondly, if the environmental conditions in China continue to deteriorate, those with high incomes and the young will leave for other countries in the same way as war has triggered waves of human migration.

No one can stop such trends because health is among the most basic of human needs, which was well-articulated by American psychologist Abraham Maslow in his 1943 theory of the hierarchy of needs.

As we see in the migration of refugees during war, young people and children will be at the forefront because they cost less to move and they are the ones who have the burden of carrying on the family to the next generation from a purely biological point of view.

Human migration that results from smog is determined by both “pushing-pulling” factors as well as costs.

By “pushing,” we mean people who are pushed out of their cities and countries due to environmental degradation. And by “pulling,” we means that people are drawn away by the better environmental and living conditions elsewhere.

But due to the constraint of costs, those who are able to leave are likely the people who are better-educated and are more concerned about air pollution.

And this will lead to what we call a “brain drain.”

Hu Dayuan, a colleague of mine, once estimated that Beijing’s economy could lose more than 70 billion yuan ($10 billion) to smog each year. I reckon he might not be able to take into account the long-term losses from brain drain. Neither are we able to factor in losses from smog-induced health damage in the long run.

According to estimates by Song Guoqing, another colleague of mine, total losses could run to more than six times the economic losses, or close 500 billion yuan a year.

Such losses will be damaging, particularly in the long run, for a country like China, which is still beset by inequality and poverty.

We also need to bear in mind that we have not taken into account the political and social implications of worsening smog.

Let’s assume that the 70 billion yuan is all the Chinese capital stands to lose every year, and then we ask the municipal government what it could have otherwise done with the money. Is the amount enough to prevent the air pollution that we see today?

I'm really not sure, and in fact, I'm very pessimistic because I do not think the money can make smog disappear or reduce it to an acceptable level.

Many still remember vividly the “military parade blue” — days of crystal-clear blue skies during the World War II victory-anniversary parade in September 2015.

But those blue-sky days came after about 5,000 industrial manufacturers in the “Jing-Jin-Ji” area were ordered to suspend production for over a month in the lead-up to the celebration, according to media reports.

If we assume that each of the factories employs 100 workers on average and each worker has a family of five to support, the mass suspension affected 2.5 million people.

Let us put aside how much local governments have lost in tax revenues and assume each of the 2.5 million people needs 40,000 yuan a year to maintain their current standard of living. The governments then must come up with 100 billion yuan a year to support the families.

But the question arises whether the government is willing to cough up the 100 billion yuan to keep the industrial plants shutter to keep the air clean, or to accept 70 billion in losses to smog.

Even if authorities opted to keep the factories closed, the option is doomed to fail because more factory owners will use pollution to blackmail governments by claiming more closing expenses than they need, and even more polluters popping up to drain the government’s coffers.

While there is still no effective technology to help fight air pollution both at home and abroad in the near future, people have no other option but to wear anti-smog masks.

The mask can reduce the PM2.5 concentration during a seriously polluted day by up to 90%, from 500 micrograms per cubic meter of air to around 50.

It is a level that is still deemed unhealthy according to international standards, but most of us choose to come to terms with it as that's as good as we can get.

In spite of air pollution, most Chinese drivers still opt to drive and protect themselves by installing air purifiers inside their cars.

But manufacturers of masks and air purifiers, which could cut pollution by up to 70%, consume more power and resources, such as coal, which makes air pollution worse — trapping us in a vicious cycle.

A possible scenario is that visibility in Beijing could drop to 5 meters and that we need to keep lights on day and night to go about our lives, and that anti-smog masks and even oxygen tanks will become essential gear — as much as an iPod for many.

Since we will see less sunshine, many people will develop smog-related depression and need longer vacations — as long as half a year — to rehabilitate.

Of course, there is always another possibility. Politicians can move industrial polluters farther south, as they have done by moving factories out of Beijing to Tianjin and Hebei province via the so-called Jing-Jin-Ji integration.

And a growing number of displaced people from the north could swarm to southern parts of the country and even some Asian countries further south … and the pollution will go along with them.

Wang Dingding is a professor at Peking University’s National School of Development and a member of Caixin Media’s Academic Board.


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