It’s a rare embarrassment of riches that reaches as far as the ozone layer.

China has just that in the form of its massive arsenal of foreign currency. Todd Stern, US lead climate negotiator, made the connection when asked in Copenhagen if rich nations owe pollution-related reparations to poorer ones such as China.

China has $2 trillion (Rs93.4 trillion) in reserves, Stern said last week. We don’t think China would be the first candidate for public funding.

The reparations issue is a non-starter at a time when the US, Japan and Europe are spending untold trillions to stabilize growth. Yet another embarrassing figure is worth considering: $16.7 billion. That’s how much Goldman Sachs Group Inc. allocated in bonuses this year, earning itself derision. It far exceeds the $10 billion in aid the US and several developed nations suggest for financing emissions-reducing projects in poor countries.

No wonder China is baulking at the US’ climate-change ante. Governments spent more than $750 billion to bail out financial companies since the credit crisis began. Here we are talking about saving the earth and leaders come up with a tenth of the amount proposed by financiers such as George Soros.

Speaking up:Protesters march through central London on 5 December to highlight public concern ahead of the UN climate summit in Copenhagen. Leon Neal / AFP

It’s time for rich nations to act by example and commit to reducing greenhouse gas emissions. Not talk, but genuine steps to right the environmental wrongs of the past. Only then will Asia get more serious about doing its share, and that’s really what the global economy needs.

It’s a cart-and-horse issue. China is now the world’s biggest producer of greenhouse gases and its inclusion—along with India—is needed to give any climate change treaty teeth. Yet countries like the US need to get serious before officials in Beijing will do the same.

The excesses of the West’s industrial revolutions are the reason temperatures and sea levels are rising and the frequency of deadly storms is increasing. Europeans polluted plenty in the 19th century and the US returned the favour in the 20th. In a perfect world, now should be China’s and India’s turn to do the same as their economies boom.

Thing is, our planet can’t handle 3 billion or so developing Asians polluting the way the West did. Just think how hard it’s going to be to breathe when more than 1 billion Chinese and Indians own cars.

While that sounds supremely unfair, it’s the reality as world leaders meet this week to cobble together a climate treaty.

As Asians grow richer, there will be more cars, planes, coal-burning factories and air conditioners churning heat-trapping gases into the atmosphere. Aside from rising temperatures, that will lead to increased health risks, slower economic growth, less foreign investment, increased government debt and rising bond yields.

The region is rapidly reaching its environmental limits. It means the blind pursuit of rapid growth just isn’t possible any more. The question really is this: When will Asia choke on its economic success?

Yet rich nations most responsible for cooking the planet should take the lead. Early drafts of a Copenhagen agreement call for far steeper cuts to their greenhouse gas emissions. Current proposals from nations including the US, Japan and Britain amount to a 10-17% drop. The hope is that they will jointly pledge to reduce heat-trapping gases at least 25% by 2020.

Rich nations should go even farther than that. US President Barack Obama, who accepted a Nobel Prize in Oslo last week, has a chance to earn it in Copenhagen this week.

This is a bigger economic issue than many realize. In April, the Manila-based Asian Development Bank said Singapore, Thailand, Indonesia, Vietnam and the Philippines may lose 6.3% worth of gross domestic product annually by the end of the century if climate change isn’t stopped.

When island nations in the Pacific and Indian oceans warn of a planetary Pompeii, they’re not exaggerating. Rising sea levels are swamping coastal areas and encroaching on groundwater supplies, coral reefs are dying off and fish are migrating from warming waters.

That may not bother the average hedge fund manager, yet it puts Asia on the front lines of trends will eventually encroach on bigger targets such as Jakarta, Mumbai, New York, Shanghai and Tokyo.

Again, China is the key. The belief China will act is needed to get the US Congress to back Obama’s ambitions. It’s also necessary to stop any US or European move to raise taxes on imports from countries that don’t require curbs on carbon-dioxide emissions. The World Bank says such taxes could reduce exports of Chinese goods by 20%.

Rapid growth is the linchpin of the Communist Party’s hold on power in China, and it won’t easily take steps to undermine it. That’s why the US and others that have been dirtying the world for centuries must act first. Along with aggressive emissions cuts, that means pledging more than Goldman’s bonuses.

Only then will China follow. Once it does, the world economy will be better off for it.

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