The New Financial Approach
China now leads Asia as it has combined its societal (environmental, health, climate and natural resources etc.) concerns with capitalism into "social capitalism." Economics can be a science only when it becomes qualitative as well as quantitative. For example, consider some conventional English economic terms that are now being pushed on the China government when the English qualitative meaning and purpose is solely for a few people to make money; a very few.
The Differences between Clean and Green
Consider two cases of words that need to be defined. First is the difference between "clean" and "green," especially when applied or used in the context of energy, water and transportation infrastructures. Most American oil and gas companies, for example, talk about "natural gas" as being a "clean" supply of energy. The most troubling misuse of the term "clean" is when it is applied to coal, so that the coal industry argument is that "clean coal" technologies for mines are good for environment. For most native English speakers the two words "clean coal" is an "oxymoron"; that is a contradiction between two words, when they are put together. "Clean coal" is not even close to be non-polluting and emitting greenhouse gases. Thus the world "clean" has an odd and not acceptable new meaning to it.
The second case is the natural gas industry, who have for over a decade claimed that their fossil fuel is "clean". This purposeful false definition of a word is troubling since natural gas is fossil fuel source. Natural gas is a fossil fuel with both particulates and greenhouse gas emissions. There may be less emissions and greenhouse gases than coal, but they are still there.
In short, the use of clean energy that is promoted by the natural gas industry for its products is false. Then these natural gas companies claim that natural gas is a "transition" energy and power source to other lower and non-emission forms of energy. When asked to define "transition" period, they either go avoid the question or even claim that it is not important. However, the meaning of "transition" is critically important. To discover and process natural gas takes long periods of time (shorter now due to many factors) but then to drill for it, process and then ship natural gas (via trucks, trains and now LNG shipped) is both costly and dangerous.
In conventional western economics today these costs are not part of the measurements for supply and demand. Instead the fossil fuel industry find ways to get these numbers deducted or removed from their balance sheets and even receive tax deductions and benefits. These costs add up and should be considered "externalities" which makes the costs for fossil fuels much higher for the consumer if they were included. Additionally most of these costs are "stranded" which means that the systems need to be constructed and in place for operation for 30-40 years in order to get the money borrowed from banks, paid back. In short, this is a questionable definition of "transition".
China is leading the way into The Green Industrial Revolution.
China and other Asian nations realize and understand this basic problem with western economics not being a science. The western economic push for cap and trade (C&T), as a way to lower carbon emissions is a serious problem. While China is considering it too, they should not. Allowing companies to pollute by "buying" their way out of causing emissions is not a good approach to lowering climate change.
Instead China needs to continue and use its "Five-Year Plans" which have substantial funding support to cover the entire nation. With these plans are the financing mechanisms to implement them. Such plans exist in other countries, some even with funding. This is "social capitalism" in action. Now in its current Five-Year Plan, China recognizes that it used western classical capitalism and thus over-built cities and regions without the concerns for energy, environment and infrastructures. That is a mistake that they are now correcting.
Earlier in the 1980s, Japan recognized that its interest and concerns were in new advanced technologies, which were critical in its modern development after WWII. Companies developed and became world leaders ranging from plumbing to auto manufacturers to entertainment and mass media. Korea did the same in the 1990s. Both continue today with other Asian nations and the City of Singapore in Southeast Asia following their lead in The Green Industrial Revolution. As Japan found out with Fukishima, western technologies like nuclear power are NOT the solution for generating power and being "clean." The Green Industrial Revolution needs to do the opposite of the nuclear power plants by using renewable energy sources now and into the near term future. Our children and future generations are depending on us to stop climate change with safe, affordable, dependable and environmentally sound technological solutions.