The hidden costs of China's Economic Miracle

What is China sacrificing for a few years of growth?

The boulders were as big as farm animals, and for $20 a month Feng Xingzhong's job was to slice them with an electric saw, cutting the hulks into fillets small enough to throw into a bowl.

Other workers in the jewelry factory would trim the pieces of jade, turquoise, onyx and other gemstones into little hearts and beads, polish them, drill holes and string them onto earrings, bracelets and necklaces to be shipped off to American shoppers.

Feng thought little about that, or anything else during his earsplitting 12-hour shift. By day's end, he looked like a coal miner emerging from the shaft, covered from head to toe in red, green or yellow dust, depending on the stone he had been cutting.

From age 18 to 26, Feng toiled without so much as a mask, trying to turn himself from an impoverished peasant into a prosperous city worker. He married a fellow employee, had two sons.

"We had a beautiful dream," Feng said. "To make some money, go home and start a small business."

Today, Feng hopes mostly to live long enough to collect some money from the factory where he developed silicosis, an incurable ailment known as dust lung that kills more than 24,000 Chinese workers each year in professions such as mining, quarrying, construction and shipbuilding. [snip]

Feng has not told his mother about his ailment. But she suspects he is dying.

"I know a guy from our village who did the same work, he died three years ago. I think my son has the same disease…. I know he probably won't live long," said Li Sulan, 64, who is blind in one eye.

Her biggest worry is her grandchildren. "If my son dies and I die too, and his wife doesn't come back, what's going to happen to these kids?" she said.

The human costs of this story is heartbreaking, and too obvious from the article for me to reiterate. But what is not explicitly pointed out is, what are the long-run economic costs of this "growth" model? To put it bluntly, a slave would have been looked after better than many of the factory workers in China, because their owner would have long-term economic incentives to look after their health. As it is, individuals buffeted by their family's immediate economic needs (and often underinformed about the risks) are not in a good position to make the kind of cost/benefit analysis that will affect their own fates and the fates of their families for decade to come.

Corners are cut in the most inappropriate ways in China in terms of worker and environmental protection, generating enormous externalities that will come back to haunt the whole country. But meanwhile, those in charge are too enchanted by quarterly GDP growth to demand that businesses proceed in an ethical and responsible manner.

There is a campaign to compensate gemstone workers suffering from silicosis, and to fight for better renumeration (and presumably better conditions) for current workers. It seems making consumers aware of the cost in sweat and blood of their pretty baubles might be the most immediate way of forcing factory owners to clean up their act.