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China To Close 2,000 Factories In Energy Crackdown 242

Posted by Soulskill
from the anti-stimulus dept.
Hugh Pickens writes "The NY Times reports that China's Ministry of Industry and Information Technology has published a list of 2,087 steel mills, cement works and other energy-intensive factories required to close by September 30 after discussions with provincial and municipal officials to identify industrial operations with outdated, inefficient technology. The goal of the factory closings is 'to enhance the structure of production, heighten the standard of technical capability and international competitiveness and realize a transformation of industry from being big to being strong,' the ministry says. The current Chinese five-year plan calls for using 20 percent less energy this year for each unit of economic output than in 2005 but surging production by heavy industry since last winter has put in question China's ability to meet this target. In addition to the energy-efficiency objective in the current five-year plan, a plan announced by President Hu Jintao late last year called for China to reduce its carbon emissions per unit of economic output by 40 to 45 percent by 2020, compared with 2005 levels."
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China To Close 2,000 Factories In Energy Crackdown

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  • by Joce640k (829181) on Tuesday August 10, 2010 @08:14AM (#33202630) Homepage

    The $€£ is still king.

  • by cosm (1072588) <thecosm3@EEEgmail.com minus threevowels> on Tuesday August 10, 2010 @08:25AM (#33202706)

    The $€£ is still king.

    Even if this was intended trolling (I don't think it is), it is an insightful point. For as much as American's rag on China as a country and their countless instances of unethical this and that, parent is correct in that here the $€£ really is king. We do not seem to have any vision when it comes to things like alternative energy, reducing our energy consumption, and industrial efficiency. Many, many businesses just keep chugging along, consuming more and more and more energy to make more and more and more money. Read the comments here [slashdot.org] for a better glimpse. Exponential growth is not sustainable.

  • by nlvp (115149) on Tuesday August 10, 2010 @08:49AM (#33202930)

    Or they're saying they don't like where the economic optimum will take them (i.e. inefficient factories burning massive amounts of energy in a period of rapid growth in energy demand), and would prefer to pre-empt the energy crisis this would create by intervening now.

    The alternative is to leave these factories alone. What happens then?

    1) China can't increase energy production fast enough to meet demand.
    2) Energy prices increase.
    3) New, more efficient factories gradually enter, taking over the business of the inefficient factories as they are forced out by rising energy prices.
    4) Meanwhile, the increased energy prices affect the rest of the economy, slowing economic growth and raising prices for consumers.

    This way is better, because they're creating room for the competition without waiting for the energy price to do it for them. This will reduce the consequences of future energy shortages on the rest of the economy, and accelerate the adoption of more efficient technology in heavy industry.

  • by delinear (991444) on Tuesday August 10, 2010 @08:50AM (#33202936)

    And no doubt you expect it to 'lead' by eliminating the pesky 'free' part, just as China does.

    Well, signing up to initiatives like Kyoto would at least be a start.

  • Its very shortsighted of us in the west to give this whole area of development to the Chinese. As they get more efficient and starts getting good at using alternative energy we in the west will still fight about oil, coal and other forms of non renewable energy.

    The future lies at the feet of whom have energy in wast amounts. If China wins this race, they win in the long run. I wouldnt be surprised if we end up paying royalties to China for their technology instead. Some politicians cling to the idea that the west will supply the brains and the rest of the world will pay.

    Our greed comes back to bite us over and over.

  • by stomv (80392) on Tuesday August 10, 2010 @08:57AM (#33203012) Homepage

    but China could have simply raised the tax on energy to push those inefficient industries out of business -- either because they rely on cheap energy (concrete) or because they're being out-competed by more efficient factories elsewhere (outdated, inefficient technology). Places with the $€£ could most certainly increase the tax on various energy sources to generate the same factory-closing result. It would have other results as well (everyone consuming less energy, a redistribution of wealth, etc etc) which may or may not be attractive for a given populace.

    So yeah, the implementation of their policy reflects statism vs. democracy. The policy goal itself (reduce energy to GDP ratio) could certainly be attained by a democratic nation with democratic policies -- using taxation or carbon pricing.

  • by ground.zero.612 (1563557) on Tuesday August 10, 2010 @09:01AM (#33203054)

    Meanwhile, here in the west the constitution is still king. You know, that little thing that protects you against random acts from the government

    I find it a sad state of affairs when the general consensus is that I need protection from my government. It should be that the government needs protection from us, the people. I'm the one with the right to bear arms. Any guesses why I was granted that right?

  • by AlecC (512609) <aleccawley@gmail.com> on Tuesday August 10, 2010 @09:09AM (#33203122)

    In the West, the $€£ is king; in China, to a large extent the Party is king. Many of these factories will be extremely inefficient and would have bell closed or replaces long long ago in the West, but have been kept going in China because of the effect on local jobs - especially local party jobs. The power that says that 2000 factories must close because of central policy is the same power that kept them open regardless of whether it was in most people's best interest to do so. Central control works both ways: when the centre is right, it can get things done very fast. But when it is wrong it can get things don, or not done, with equal efficicency. For all its defects, when the market is working properly it is remarkably efficient.

  • by TrisexualPuppy (976893) on Tuesday August 10, 2010 @09:24AM (#33203286)
    You're missing the point.

    China is doing this to improve their image. Their government refuses to take human rights seriously because they would lose the great deal of control that they have over their populace. If they can look "green" instead and publicize it, they have basically traded bad human rights image for good environmentalist image while giving up far less (in their views) to get the environmentalist image. The net result is that to a body like the UN, China would look no worse than any other country. The UN would eat it up all day long. So, yes, image = money.

    However...

    I have been to China. Where they stand right now, even if they went full-force, it would take at least a decade to get to where Europe is. They aren't going to want to do that because their goods would cost more to produce, and that would affect their bottom line.
  • by Shakrai (717556) * on Tuesday August 10, 2010 @09:43AM (#33203528) Journal

    Guess there are some real advantages to a oligarchy over a democracy.

    I'll pass.

  • Re:Playing Civ (Score:4, Insightful)

    by need4mospd (1146215) on Tuesday August 10, 2010 @09:44AM (#33203536)
    Agreed with one exception: In Monopoly, the bank can't win.
  • by Anonymous Coward on Tuesday August 10, 2010 @09:45AM (#33203542)

    Don't flatter yourself. There are materials that have been banned in manufacturing in the USA and are completely legal to import from elsewhere. Take, for instance, my friend's cookware company. They were not allowed to manufacture a part of the handle for their frying pans because it contained lead, so instead, they shipped off their manufacturing to China where the lead was no problem, and they also managed to get some cadmium yellow into certain handles. It was okay to import and sell since none of the cooking surface was exposed to the lead/cadmium, but it just goes to show.

    And by the way, being environmentally clean costs money. I don't get how you claim that products are going to be cheaper when they're "green." There's a lot more to it than buying machines that can produce "green" products.

  • by mitgib (1156957) on Tuesday August 10, 2010 @10:12AM (#33203894) Homepage Journal
    What is more plausible is China no longer wishes to buy our bonds. We are seeing this in many countries already, shifting their holdings to the Euro. as fewer are willing to purchase US Treasuries, the higher the interest rate will need to be offered to attract buyers, which in theory would cost the tax payer more, but reality shows it is just the largest ponzi in existence.
  • by YrWrstNtmr (564987) on Tuesday August 10, 2010 @10:13AM (#33203896)
    and they even (gasp!) signed the Kyoto protocol the US took a dump on.

    They signed Kyoto because, being a non-Annex I party, they didn't actually have to do anything!
  • Yeah, yeah. See also: paranoid fears of Soviet-style "efficiency" back in the 1950s and 1960s, where people who didn't trust Capitalism wrung their hands at the thought of government planners "finally" creating the Perfect Society. Result: Collapse.

    Then see the 1980s, where paranoid fears of Japan-style efficiency of "government / industry partnerships" where going to bury the West's economy, due to the efficiency of government planners really doing it right this time. Result: Collapse, and restructuring.

    Now we have a banking collapse in the United States caused by government planners who wanted low-income people to be able to buy homes. And we're seeing more and more government / corporate "partnerships" (otherwise known as corruption). Result: Not quite collapse yet, but it's getting way too close for comfort.

    It would be nice if people would learn that lightly regulated Capitalism, where the government acts as a referee and NOT as a partner, has produced the strongest economies. Unfortunately, the "invisible hand" is hard to understand. Having King Government in control of everything is easy to understand.

  • by ckhorne (940312) on Tuesday August 10, 2010 @11:42AM (#33204926)

    Geez- I guess I'll have to spell it out...

    I certainly wasn't suggesting that we start another war - yes - "space race" would have been a much more appropriate term. The space race was fueled by the cold war. In the case of countries improving efficiency, there needs to be some reason to precipitate change. The space race came about largely through national pride (and underpinnings of spying and the ability to launch weapons from space). However, we saw some of the fastest and most significant changes during the space race- arguably more than any other time through history. If that same push for change / innovation could be redirected to a race for efficiency and environmental awareness, then, yes, I still think it's a good thing.

    No, an economic struggle doesn't equate to an environmentally sound economy. I'm not sure how that was construed from what I meant, other than I possibly just didn't type out the concept in detail. However, there must be a reason for a company to push for environmental stewardship, and given the capitalistic nature of companies, it'll have to be economically biased. That may be through taxes. It may be through consumers. It may be for the company's own long term stability. I don't know. The point is that, for most companies to change to a more environmentally sound process, it has to positively affect their bottom line.

    And that brings me back to my original point. Consumers are not necessarily "green"; however, you do see changes, even if only token efforts - buying more fuel efficient cars, organic food, products like the iPhone sold with environmental impact statements - all at a higher cost than their non-green counterpart. Is it enough? No. Will what we have now make a difference? No. But it's a step in the right direction, compared to consumerism 20, 30, 50+ years ago.

    I can only hope that this trend continues. The pinnacle of this would be a consumer-driven "race" for companies to adapt their processes so that there was a overall, global, positive environmental impact.

  • by swb (14022) on Tuesday August 10, 2010 @11:43AM (#33204930)

    How do we know this has anything at all to do with any high minded ideals at all?

    How do know this isn't more about politically loyal and financially compliant entities being allowed to continue operating and disloyal entities or those on some enemies list are being shut down?

    As a scenerio, assume that while China's GDP numbers look good there's some slow contraction going on as the economies in the West continue to suck and manufactured goods purchases slow. This leads to rocky business environment and getting rid of the competition makes sense. To keep loyalists loyal, the party thins the heard. The survivors tithe to the party, make money and show their loyalty.

    Convenient and high-minded rationales are sold to the people and the west.

  • Re:Playing Civ (Score:2, Insightful)

    by Confusador (1783468) on Tuesday August 10, 2010 @12:15PM (#33205374)

    If you can't win when you're the banker in Monopoly, you're playing it wrong.

  • by DABANSHEE (154661) on Tuesday August 10, 2010 @01:43PM (#33206560)

    Their one child policy means there's 400 million less Chinese than there otherwise would be. That means huge cuts in emissions in China already

One man's constant is another man's variable. -- A.J. Perlis

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