China's use of force to solve Olympic-sized pollution problems may be preview of cap-and-trade policies.

It is not unusual for nations hosting the Olympic Games to orchestrate a false charm for visiting athletes and spectators, and most of all for the media. This typically extends to covering up graffiti and chasing the homeless from the streets. In China, host of the 2008 Beijing Games, residents tell me schools plan to open several weeks late. As has occurred with other games, some businesses are closing.

China’s twist is that it is the state forcing businesses to close, and not just near the games but nationally, to alleviate the nation’s appalling air, water and other pollution problems. A poor but rapidly developing country, China is progressing through what is known as a “Kuznets Curve” on environmental issues. That is, societies first prioritize activities that may cause harm to the environment; after reaching a certain level of wealth, environmental quality attains a value in its own right and people – now richer – affix a cost to it that they are willing to pay in the form of environmental regulations.

China’s transition is slowed by its undemocratic system as much as wealth and technology transfers from the West have accelerated its progress. Yet in China’s actions this summer we may be seeing our own future of carbon restriction.

China just became the world’s leading producer of CO2, a necessary product of combusting fossil fuels. Largely produced by nature, CO2 is also a “greenhouse gas” that allegedly drives changes in the climate. Contrary to degrading the environment, however, carbon dioxide output continues to increase with a nation’s wealth. However, in this case China’s padlocking of many businesses has nothing to do with reducing emissions of this odorless, colorless gas that not only feeds plants but is expelled in force by, for example, athletes when they exhale.

Tremendous political pressure has grown for major economies to reduce carbon emissions in the name of halting climate change. And as the Christian Science Monitor noted in a recent editorial about the business closures, “Not only is the world seeing an example in China of the massive effort needed to alter the climate but one draconian way to do it – by fiat,” noting “[t]he difficulties of imposing climate-change burdens in a democracy.”

That is an understatement. Indeed, dictatorial fiat may be the only way to reduce greenhouse-gas emissions. Experience to date indicates that no free society would do to itself what, for the foreseeable future, the “global warming” agenda requires.

Yet ironically, it is only the free societies that signed up to Kyoto’s rationing agenda, so it should come as no surprise that their promises are being flouted. Those parties to the treaty which actually reduced emissions from the (seemingly arbitrary) 1990 baseline year all did so the old-fashioned way, through economic collapse. One nation, the United Kingdom, shifted from coal-fired power to natural gas. Dwindling supplies, however, have led to the reopening of U.K. coal pits.

Despite promises, emissions are on the rise everywhere.

With some outlying exceptions, even scientists adhering to the man-made global warming thesis acknowledged in Science in 2002 that “There are no known technological options that exist today. Energy sources that can produce [projected demand of] 100 to 300 percent of present world power without greenhouse emissions do not exist; either operationally or as pilot plants. New technologies will require drastic technological breakthroughs. Carbon dioxide is a combustion product vital to how civilization is powered; it cannot be regulated away.”

As such, China’s chosen means of pollution-reduction do seem to be just what honest adherence to Kyoto-style “cap-and-trade” rationing schemes demand. Even proponents like Michael Grubb of the pro-Kyoto Carbon Trust acknowledge that energy-intensive industries might simply flee the cost of reducing CO2 emissions, triggering a shift in those sectors from Europe – and presumably the U.S. – to the majority of the world’s nations which reject carbon controls. “In the future, European companies may decide to make big investments abroad, say in Brazil, because Europe is too expensive.”

Grubb proved prescient. The Spanish government closed two plants for failure to have “Kyoto” permits. A ceramics facility there closed after “equilibriating” its operations. According to the company’s own statement, this meant that it stopped producing ceramics in favor of selling its carbon emission certificates instead. After all, it requires a lot less energy and far fewer employees to go into the business of producing nothing.

In short, when viewing the Beijing Olympics human-interest pieces, closely read the discussion of temporary measures undertaken in the name of reducing actual air pollution. You might be viewing the future.

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