The news that China will phase out all fossil-fuel taxis the near future plying the streets of Beijing, and that the government has approved plans for the massive implementation of electric cars across the country, has been buried under articles in Korea about Pyongyang’s nuclear weapons and possible FTA (free trade agreement) re-negotiations.
I remember the single pathetic electric car parked for years in front of the president’s office at KAIST University. As it rusted away there proudly, no steps were taken to actually start using electric automobiles on a large scale in Daejeon, or Korea.
While Koreans were fretting about whether President Trump would be nice to President Moon Jae-in, China has committed $360 billion through 2020 to the development of renewable power and is well on its way to being the dominant power for the development and production of solar and wind power.
Perhaps Koreans are thinking that if they just make a few more smart phones, or sell a few more sleek automobiles overseas, the Korean economy will get back on its feet. Sadly, they have failed to grasp the monumental scale of the economic and technological shifts taking place today.
Let us look at the current economic shift from a historical perspective. China had the largest and most sophisticated economy in the world before it was displaced by Great Britain. China’s success drew on its high level of education and the lack of military conflicts in the seventeenth and eighteenth centuries, but above all it was China’s capacity for the production of food on a massive scale, with high efficiency, that was the key point.
Before the 1830s, energy took the form of human and animal labor. That is to say that energy could only be obtained from the sun via photosynthesis in agricultural production of food and them expressed through manual and animal labor.
China had a sophisticated long-term agricultural policy, the crowning glory of which was the expert administration of an advanced irrigation system covering the entire country.
But the British (and later the French and Germans) started a new economic system based on coal in the 19th century. Coal provided far more energy than wood, or than manual labor, and powered factories that produced goods on a massive scale. The Chinese system could not complete with this new economic process, and when coal power spilled over into military applications, China (and all of Asia) found themselves humiliated in the Opium Wars.
But that coal-based economy that drove the British Empire did not last forever. The United States moved quickly in the early twentieth century to build the infrastructure for an economy based on petroleum, a fossil fuel even more efficient than coal. The United States embraced this new petroleum-based economy quickly because it had the institutional flexibility to do so, and also because the American economy was not tied to coal to the degree that Britain’s was. The United States ended up at the center of an automobile-centered new global economy.
But the game was not over. China is challenging the world economic system, taking full advantage of recent efficiency breakthroughs in solar and wind power that make a fossil fuel-free economy possible. These breakthroughs form an exact parallel to the breakthroughs in steam engines early in the 19th century in Britain and Germany that turned the world economy upside down.
China is well on its way to dominating this new paradigm for energy production, one which may eliminate the need to import expensive fuels to power production ― not to mention reducing costly foreign wars to secure petroleum.
If China manages to dominate the technology for solar and wind energy production, control its manufacture it will thereby effect a fundamental shift in the global economy that will be the equivalent to the two previous turning points in world history. Parallel to China, Germany has also started to move towards renewable energy in full force.
And what about Korea? If Korea cannot break with its current petroleum-dominated economy and it fails to make that fundamental leap in its thinking about the economy, what are its prospects? The future is grim for Korea if it lacks the will to walk away from its addiction to Middle Eastern and American oil money? It could go down with the nations trapped in an outdated economic system, just like China did in the 19th century.
The changes that are required to adopt this new renewable energy paradigm are profound. One thing is certain. The time has come for Koreans to awaken from their dream of exporting their way to riches, and rather to take a hard look at the foundations of the Korean economy.