photo: 1suisse/Creative Commons
A perfect example of how not why we need to start including the cost of environmental damage in national economic indicators: As The Guardian reports, new official Chinese calculations show that the cost of pollution, deteriorating soil, desertification and disappearing wetlands increased to the equivalent of $196 billion in 2008--and that's based on incomplete data, so the true figure could be even higher. In terms of GDP, that's roughly 4% of all economic activity. In the same year, official GDP growth was 9% and total GDP was about $4.42 trillion.
In 2007, the cost of environmental damage in China was about $117.8 billion, according to World Bank and China's environmental ministry. Going back further, in 2004 pollution cost China's economy $64 billion.
Why the perfect example?
photo: William Warby/Creative Commons
Just because something isn't measured doesn't mean it's not taking place or doesn't exist
Continuing to ignore the environmental costs of our activities doesn't mean they aren't happening. Failure to incorporate depletion of natural capital is first and foremost delusional (at a very basic level of perception), but is also a serious market failure.
We've gone over this dozens of times on TreeHugger, with a variety of examples, but in general it goes something like this, reduced the consumer level: When socioecological factors are not included in the price paid for a particular good--be it energy, food, your clothes, or the latest electronic gadget--the price is artificially lower than it should be. The social and ecological costs of producing that particular good don't simply go away, they are just passed off for society as a whole to pay, in one way or another.
On a national basis, the same thing applies. While GDP may continue to climb, when the costs of environmental degradation and pollution are subtracted from that, that growth rate, as well as future ability to continue it, is lessened.
photo: Kam Abbott/Creative Commons
It may seem like a wonky economic issue, but it's not. On the most basic level it is serious and deep misperception of existence--as deep as mistaking a coiled rope for a coiled snake (to use a classic example from Advaita). It's a basic misperception of life, the place of humanity and human activity within it, and the accounting for the impact of those actions on others and the world.
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More on China:
China Issues World's First 'Green GDP': Pollution Cost $64 Billion in 2004 (At Least)
China Being Submerged in Sand: Desertification Spreads 1,300 Square Mile Per Year
China's Coal Burning Cost the Environment $13 Billion Last Year