‘Just between you and me,’ said the World Bank’s top official in a memo

that he has come to regret, ‘shouldn’t the Bank be encouraging more migration

of the dirty industries to the less developed countries?’

The World Bank’s headquarters in Washington DC leak so many memoranda

to the city’s pressure groups and lobbyists that there is one group, the

Bank Information Center, entirely devoted to disseminating them. And sure

enough, the words of Lawrence Summers, chief economist with the Bank that

lends from the world’s rich governments to poor governments, were all over

Washington last week.

Summers, an enthusiast for the Bank’s policy of encouraging poor countries

to open their borders to trade, went on to explain why he thought that it

was legitimate to encourage polluting industries to move to poor countries.

‘The measurement of the cost of health-impairing pollution depends on the

forgone earnings from increased morbidity and mortality,’ he wrote. So dangerous

pollution should be concentrated ‘in the country with the lowest wages’.

He added: ‘I think the economic logic behind dumping a load of toxic

waste in the lowest wage country is impeccable and we should face up to

that.’


He also introduced the novel notion of the ‘under-polluted’ country.

These included the ‘underpopulated countries in Africa’ where ‘their air

quality is probably vastly inefficiently low compared to Los Angeles’. His

point was that since clean air, which he calls ‘pretty air’, is valuable

as a place to dump air pollution, it is a pity poor countries can’t sell

their clean air for this purpose. If it were physically possible there would

be a large ‘welfare-enhancing trade in air pollution. . .’ he says.

Summers admits in his much-faxed memo that there might be objections

to his case, on moral grounds for instance. But he concludes by saying that

‘the problem with these arguments’ is that they ‘could be turned around

and used more or less effectively against every Bank proposal for liberalisation’.

‘What he is saying,’ comments British environmentalist Nicholas Hildyard,

‘is that this argument represents the logical conclusion of encouraging

free trade round the world.’

Summers has responded wearily to the uproar over his remarks. They were

intended to be ‘highly ironic’. ‘These positions were stated as a sardonic

counterpoint’ to a more general argument, he writes in a memo with an initial

distribution list of six that is now chasing his earlier effort down Washington

fax lines.