Tuesday, November 13, 2007

Communism, capitalism, and environment

An anonymous Marxist third-world commenter mentioned - incredibly - that he or she thinks that the environmental situation in post-socialist Europe became worse after the fall of communism. I just can't believe that someone would buy such a thing because it is crazier than any propaganda I have heard during communism.

The improvements are manifest and sometimes breathable througout post-socialist Europe but I will choose the best example, the Czech Republic, for both obvious as well as less obvious reasons. You should read:
Environment in the Czech Republic: A Positive and Rapid Change
by Bedřich Moldán and Tomáš Hák. According to a Yale's 2006 report, Czechia ranks 4th among 133 countries in environmental performance, after New Zealand, Sweden, and Finland. Let me sketch some basic facts about the history.

The black triangle

The black triangle near the common borders of Czechia, East Germany, and (to a lesser extent) Poland used to be one of the most polluted regions in the world, full of power plants, chemical plants, refineries, dirty mines, and steam heating. Pilsen where I lived used to have a lot of industry and was very influenced by it: but there is no doubt that the Northern Bohemia was much worse, environmentally speaking. You couldn't really breath there. When there was smog, and it was extremely often, the visibility would be counted in hundreds of meters only.

The communist party was proud that it managed to produce millions of tons of coal or steel more than during the previous five-year plan. Similar quantities were used to measure the progress. Acid rains completely killed many forests in Krušné hory, the mountains near the border with Germany. Some diseases were linked to the very bad environmental situation and the life expectancy was significantly lower than today but you shouldn't imagine that life was impossible. As far as I can say, no one really cared much. Except for Greenpeace, there were no groups that would complain about the environment and Greenpeace was always viewed as a group of whackos, both by communists as well as most anti-communists.

Right after the Velvet Revolution

During the first two years after 1989, many useless factories that only existed to fulfill communist plans - and to export things to the Soviet Union for them to satisfy their plans - were closed. The emissions of everything dropped by dozens of percent. Even though the GDP dropped by 12 percent from 1990 to 1991, you can't really say that the life standards decreased. The difference arises because the GDP included a lot of nonsense that wasn't making anyone happy.

Fertilizers per hectare dropped 28%, greenhouse gases by 15%, localized organic pollution by 11%, SO2 by 7%, particulate matter by 5%.

The mid 1990s

The previous era had obvious reasons: the organized irrational exuberance of communism applied to coal, iron, fertilizers, and other commodities was stopped. But once capitalism started to work, things kept on improving not only because of bad aspects of communism but mainly because of virtues of capitalism, especially the power of restructuralization and privatization.

Moldan and Hák explain that the progress was a combination of research that was suddenly allowed combined with the individual care about people's health. I repeat. The progress wasn't achieved because of some vague abstract interest about some vague and ill-defined environment or because of someone's quotas and plans to improve the whole environment but because of a clear, well-defined desire of people to be healthy and to live in a nice place. About CZK 350 billion was invested in total, and CZK 150 billion (less than 50%) went from government sources.

These improvements were thus pretty much funded from those sources that were really influenced by the environment. Investments were substantial and the results followed, especially in the context of some gases of my childhood:

• SO2 dropped by 88%
• other pollutants (such as heavy metals) were in between SO2 and NOx
• NOx dropped by 38%

Of course, there were particular reasons allowing SO2 to drop: desulfurization scrubbers by energy utilites. Despite this decrease, Czechia still produces by 50% more SO2 and NOx per capita than the average EU-15 country: 22 kg and 33 kg, respectively. Nevertheless, because we have seen that emissions that are higher by an order of magnitude don't really kill most life, we also know that the current values are not disastrous in any sense.

About 1,000 new wastewater plants were built by end of the century so that they covered virtually all places with more than 10,000 people. Water simply became clean. Independently, pollutants in wastewater decreased by 90% or so.

Krušné hory, formerly mountains filled with dead forests, smoke, and chimneys on the background became a quiet and attractive world of mountain peatbogs, clean creeks, interesting architecture, and good opportunities for various sports.

Between 1999 and today

The environment has been improving rapidly until the end of the 1990s - especially because the fraction of GDP paid for such improvements exceeded 2%. At the end of the century, people generally became satisfied with the environment which means that the investment dropped considerably: the total environmental expenses decreased to 0.7% of the GDP in 2002 and let me admit that I view this percentage as a sensible figure for out times.

Moreover, people decided that the democratic government itself can manage to solve these things. Well, it is doing a better job than the communists but it is still a government which simply can't be that good in these matters. Nevertheless, the authors explain that the situation is simply good and there are no longer any major worries about the environment in the Czech Republic that has become a representative European country in these respects.

The greenhouse effect has played no role in the improvements described in this article. Nevertheless, energy efficiency was clearly important because energy costs money. A by-product of this desire to be energy-efficient is that the Czech Republic is safely below the limits imposed by the Kyoto protocol which are 8% below the 1990 levels: the main reason is, of course, the dramatic suppression of the useless heavy communist industry. That's why the Kyoto protocol itself is surely no burden for Czechia.

On the other hand, no one in the Czech Republic would mind if temperatures increased by 1 degress or a few degrees. The average annual temperature is around 10-11°C. According to the favorite destination of Czech tourists, the optimal average temperature according to most Czechs would surely be at least 5°C higher. We will have to burn fossil fuels for 500 more years, I guess. ;-)

Whether or not you achieve the reductions described above and increased efficiency doesn't depend on bureaucrats' and environmentalist activists' pressure or international treaties. It primarily depends on the efficiency of your economy and the solvency of the people who are actually influenced by the environment and who have interest for things to improve either because of themselves or because of the image that their genuine care about the environment brings them.

I think that the lesson is clear. Useless pollution simply disappears as long as people have the economic freedom to act rationally. And if the people get both free and richer, they start to increasingly care about the environment and they simply pay their own money for any problems that really influence their health or the beauty of their environment.

The fact that the Czech Republic became the best example in these improvements is not a coincidence. It is not because your humble correspondent is Czech either. It is because it is the richest post-socialist country (with a possible exception of Slovenia which is too small for conclusions to be taken too seriously and East Germany where an illogical divergent inflow of money from their rich Western brothers makes conclusions inapplicable elsewhere). The richer you are, the more you are ready to pay for luxurious things such as a high quality environment.

And that's the memo.