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China’s Emissions Are Made in America

The U.S. corporations that exploited China’s weaker regulations to lower costs are to blame for many of its emissions.

An aerial photo taken on September 11, 2021, shows large container ships loading and unloading cargo at Yangshan Deep Water Port in Shanghai, China.

The debate over the reality of climate change is over. After years of oil-fueled denialism, the inescapable fact of the human-altered climate has finally hit home for many once-skeptical Americans. In some cases, it has literally hit home. In various parts of the country, homes are being threatened, torched and inundated by a barrage of climate-stoked catastrophes. Real-world experience has replaced easy-to-dismiss graphs and scientific models with failing crops, drowning livestock, escalating insurance costs, collapsing infrastructure, rising seas and waning biodiversity. The doomsday scenarios scientists have predicted for five decades are now all too real for 1 in 3 Americans.

An Ipsos poll in June of this year found that, “Seven out of 10 Americans are aware of the scientific consensus that climate change is largely caused by people,” and a Morning Consult poll in April found that only 19 percent of voters said climate change is “not an important threat at all.” Additionally, a fulsome 60 percent of the voters surveyed by Morning Consult wanted the U.S. in the Paris climate accord, while just 22 percent wanted to keep the U.S. out. For all but a shrinking minority, fanciful claims that climate change is a hoax or a “globalist” plot have been largely foreclosed by realities on the ground. Even notable naysayer and snowball artist Sen. Jim Inhofe (R-Oklahoma) now claims he never called climate change a “hoax,” despite authoring a book titled, “The Greatest Hoax: How the Global Warming Conspiracy Threatens Your Future.”

Sadly, it took successive years of deadly floods, grinding droughts and apocalyptic wildfires to convince so many people, but here we are. The popular question has moved on from “Is it settled science?” to “What can and should be done about it?” And while some might take solace in knowing that many of the oil industry’s congressional stalwarts have finally acquiesced, it is cold comfort to others who see valuable time ticking away while leaders who’ve long accepted the reality of climate change haggle with recent converts over the appropriate steps to avoid catastrophe.

For members of the recently created Conservative Climate Caucus in the House of Representatives, it’s an existential struggle between elements of socialism and status-quo capitalism, between the Green New Deal and market-based strategies, between regulations and unchecked economic growth, between immediate reductions in hydrocarbon use and long-term hopes for scientific breakthroughs, and between government intervention and the laissez-faire logic of adaptation.

It’s a debate echoed in the Senate by “former” climate skeptic Sen. John Barrasso, a Republican from the uranium-rich petrostate of Wyoming. He’s switched from outright denial to tactical retreat and obfuscation. While now admitting the climate crisis is a thing, he’s also said “reducing the use of fossil fuels will not solve climate change,” an idea that common sense and expert opinion resoundingly rejects. In a USA Today op-ed, Barrasso touted his role in a “historic, bipartisan environmental innovation law,” referring to an agreement tucked into an energy bill that reduced hydrofluorocarbons emissions. But he also claimed President Biden’s executive orders to rejoin the Paris accord, nix the Keystone XL pipeline and freeze new oil, gas and coal leases on federal lands took “a sledgehammer to the economies of Western states without putting a dent in climate change.”

Then he revealed the core of the emerging “debate and delay” strategy with this key juxtaposition:

Damaging America’s economy won’t stop climate change. Between 2015 and 2019, carbon dioxide emissions jumped in Russia, China and India.

At the same time, U.S. emissions continued to drop, as they have since 2007.

And there it is. For Republicans ranging from supposed converts like Barrasso to meme-wielding conspiracy peddlers like Rep. Marjorie Taylor Greene (R-Georgia), China is the excuse to do little or nothing.

To wit, the mission statement for the aforementioned Conservative Climate Caucus bluntly asserts that “China is the greatest immediate obstacle to reducing world emissions.” And when the Intergovernmental Panel on Climate Change’s (IPCC) dire “Sixth Assessment” hit the news cycle in August, Conservative Climate Caucus ranking member Garret Graves (R-Louisiana) admitted it “highlights the urgency of climate change,” but said, “we must ensure we approach this issue the right way.” The “right way” for Graves means “avoid[ing] policies that rely on higher taxes, increased regulations, and ensure us being under the thumb of China.”

More specifically, conservatives often emphasize, the U.S. must avoid being “under the thumb” of “Communist” China. They stress the “Communist” part (a label still ironically pasted on the face of a country so steeped in neoliberal capitalism), perhaps because it’s only a short rhetorical leap from Beijing’s “Reds” to the “socialist” Green New Deal here at home? More directly, they deem it “unfair” to demand unilateral action by freedom-loving Americans while Communist China gets away with runaway carbon emissions.

Of course, it’s true that China accounts for more than half the world’s coal power and is the world’s largest carbon-dioxide emitter. It’s also true that U.S. CO2 emissions have declined over the years, while China’s are now nearly twice the U.S.’s. And it’s also true that, as David Holt, president of the fossil-fueled Consumer Energy Alliance recently wrote, China is home to 23 of the “top 25” cities “responsible for 52 percent of the planet’s urban greenhouse gas emissions.” But that fact doesn’t magically vacate the U.S.’s responsibility for its own emissions.

Nor does it obviate the fact that, as Mongabay pointed out, “historically, the U.S. is responsible for a quarter of the world’s greenhouse gas output.” That’s despite being home to less than 5 percent of the world’s population. In fact, the study Holt cited on emissions in China also noted that China’s per capita output is still below “wealthier countries” like the U.S. and those in Europe. But for conservative climate converts looking for a way to block real regulatory efforts, the question of “Why should we ‘pay the price’ economically while China gets away scot-free?” is the ultimate Trump card (pun intended).

The “Unfairness Doctrine”

When former President Donald J. Trump announced his withdrawal of the U.S. from the Paris climate agreement, he claimed it was “simply the latest example of Washington entering into an agreement that disadvantages the United States to the exclusive benefit of other countries.” He complained that it “punishes the United States” while “China will be able to increase these emissions by a staggering number of years — 13. They can do whatever they want for 13 years. Not us.”

For Trump, who often wove a narrative of betrayal rooted in the relocation of the U.S.’s consumer-driven industrial base to China, the Paris accord was “less about the climate and more about other countries gaining a financial advantage over the United States.” He bemoaned that “the Paris Accord is very unfair, at the highest level, to the United States.”

In post-denialism U.S., this is the main political argument against unilateral climate action. It’s the “Unfairness Doctrine.” It’s the idea that it is patently “unfair” for the U.S. to absorb the economic harms that will come from unilateral disarmament on climate while environmentally lax “Communist China” hums along in a profitable, carbon-spewing victory. But this is based on a fundamental fallacy: that the U.S. bears no responsibility for the millions of tons of landfill fodder produced in Chinese factories and shipped to its seemingly insatiable consumer market.

The stark truth is that China’s pollution is largely made in America.

Simply put, corporate America has fueled much of China’s carbon-belching industrial behemoth. U.S. corporations and investors exploited China’s relatively few environmental regulations, along with its vast supply of cheap labor, in an effort to minimize the cost of doing their business. U.S. corporations were able to relocate their manufacturing to China thanks in no small part to All-American economic policies emphasizing maximum profit and avoidance of regulations. Those policies, in turn, globalized the supply chains that made those profitable regulatory dodges possible.

A Decades-Long Process of “Offshoring”

Six million dollars.

According to U.S. Census data, that was the trade deficit with China in 1985. It’s also the launching pad for a meteoric rise. It started during the yearly renewals of its “Most Favored Nation” (MFN) trade status during the Clinton years. But it skyrocketed after President George W. Bush granted China “Permanent Normal Trading Relations” (PNTR) — meaning a “free-trade” designation that drops trade barriers and lowers tariffs to “most favored nation” status — in 2001. That, along with President Clinton ushering China into the World Trade Organization during the previous year, accelerated the now-infamous process of “outsourcing” or “offshoring” as U.S. businesses rode the wave of globalization in search of cheap labor in poorly regulated countries with lax or nonexistent environmental standards.

Another term for this process is “externalization.” That’s when a business removes, or “externalizes,” a negative cost of doing business, taking it off the balance sheet and, therefore, increasing profitability. When it comes to externalizing the environmental costs of pumping out billions of dollars of consumer goods, it can also be thought of as “exporting” the ecological overhead to another market or country (in this case, China) where the price of polluting is pennies on the dollar. And that’s exactly what the U.S. business sector has done since that paltry $6 million deficit was logged in 1985.

By the time Clinton was elected in 1992, the trade deficit with China was $18.3 billion. It hit $83 billion when he left office in 2001. It basically doubled during George W. Bush’s first term, reaching $162 billion in 2004. It nearly doubled again by 2013, hitting $318.8 billion, before hitting a high $419 billion in 2018. But those dollar amounts only tell half the story. To visualize the way the trade deficit has “externalized” billions of tons of carbon production over the years, compare the following two charts:

A Long-Term View on U.S. Trade With China
Credit: Statista
Fossil CO2 Emissions of the Major Emitting Economies
Credit: © European Union, 1995-2021

As these charts illustrate, there’s a direct correlation between the rise of China as Corporate America’s offshore factory and China’s rise as the world’s leading fossil fuel-burning, carbon-emitting nation. You can see the “lift-off” point after it was granted PNTR in 2001.

Currently, U.S. corporations and consumers directly drive at least one-fifth of China’s industrial carbon output. But that doesn’t fully account for the indirect, carbon-polluting oil-driven supply chain that takes oil and gas out of the ground in the Middle East and ships it to China, where it is burned for fuel and manufactured into hydrocarbon-based plastic products. Those products get shipped overseas to ports on the West and East Coasts of the United States before being trucked to retail outlets and home shoppers around the country, with CO2 produced every step of the way. Even worse, China’s mass production of hydrocarbon-based plastic for the U.S. market helps sustain the global oil industry’s heavily subsidized business model.

China’s carbon production is also indirectly subsidized by the U.S. military, which is the de facto guarantor of the international oil economy and, specifically, of oil and gas shipments from U.S. partners in the Persian Gulf to China. The U.S. Navy’s Bahrain-based Fifth Fleet, among other military assets, ensures the free flow of hydrocarbons into China’s fossil-fueled factories. In 2020, according to World’s Top Exports, nearly “half (47.1 percent) of Chinese imported crude oil originated from nine Middle Eastern nations,” with U.S.-protected Saudi Arabia atop the list of China’s main oil providers. The U.S. is ninth on the list. In 2020, the U.S. and its staunch allies in the United Arab Emirates and oil-rich Norway were the only countries increasing oil exports to China’s carbon-generating industrial sector, while the rest saw declines.

At $6.3 billion, the amount of oil the U.S. provides is overshadowed by the amount of hydrocarbon-fueled goods that flow back across the Pacific and into the U.S. economy. But that huge deficit is priceless when it comes to creating plausible deniability for U.S. politicians who can crow about the “unfairness” of regulating U.S. carbon emissions while China’s emissions grow unchecked. Frankly, it’s implausible to deny the role played by the U.S. economy’s appetite for a vast array of cheap products, plastic widgets, electronic components, tools, chemicals and other goods that externalize the production of carbon emissions and, in the process, give politicians and the oil companies they represent a bogus argument for doing little or nothing to address the climate crisis.

They even want to have it both ways.

So, conservatives say it’s unfair to expect the U.S. to reduce its carbon output without an enforcement mechanism punishing China for its pollution, and it’s unfair for the EU to use an enforcement mechanism to punish nations like the U.S. that refuse to meet its higher standards.

What’s truly unfair is the cost being paid by low-emitting climate causalities like Madagascar and the Maldives and Honduras. Meanwhile, fairness-obsessed, but heavily oil-funded politicians of both parties haggle over incremental efforts versus market-based solutions while the manufacturing monster U.S. policy helped build takes steps aimed, as reported, at “maintaining its domination” of the renewable sector “into the near future.”

But China’s epic lead in manufacturing renewables is fraught for the same reason it was problematic to externalize manufacturing of consumer goods and industrial components. Solar panels are being built with forced labor and battery production tainted by child labor.

That China’s model is imprinting the future with exploitatively produced solar panels and batteries is, in part, a function of the United States’s abdication of its outsized responsibility for the climate crisis. Ironically, the political debate about “fairness” mimics the process of externalization that offshored megatons of carbon pollution to China. In essence, U.S. political leaders and the corporate interests they serve seek to externalize their responsibility for creating China’s carbon-belching behemoth. As they do, they are merely replacing climate denial with costly climate delay by making China the boogeyman, which justifies doing nothing at all.