Getting our national climate regulations in order is necessary

China today is entering a really delicate phase on the climate-energy issue - the phase I like to call "The Wal-Mart environmental moment." I wish the same could be said of the United States and President Bush.

The "Wal-Mart environmental moment" starts with the CEO adopting a green branding strategy as a purely defensive, public relations, marketing move. Then an accident happens - someone in the shipping department takes it seriously and comes up with a new way to package the latest product and saves $100,000. This gets the attention of the CEO, who turns to his PR adviser and says, "Well, isn't that interesting? Get me a sustainability expert. Let's do this some more."

The company then hires a sustainability officer, and he starts showing how green design, manufacturing and materials can save money in other areas. Then the really smart CEOs realize they have to become their own CEO - chief energy officer - and they start demanding that energy efficiency become core to everything the company does, from how its employees travel to how its products are manufactured.

That is the transition that Lee Scott, Wal-Mart's CEO, has presided over in the past few years.

Last July, Scott was visiting a Wal-Mart in Las Vegas on a day when the temperature was more than 100 degrees. He happened to notice that a Wal-Mart staple - inexpensive Styrofoam coolers - were not being promoted by the store's associates. As Andrew Ruben, Wal-Mart's vice president for sustainability, told me: "Lee walked into the store and said, 'It's 105 degrees. Why aren't we selling any coolers?' The associates said, 'We don't want to sell Styrofoam coolers because of their impact on the environment.' So Lee called us afterwards and said: 'We're going to have to figure this out.' By that he meant innovation of a different kind of cooler" that doesn't come from petroleum-based Styrofoam, which is not biodegradable and usually not recycled.

Wal-Mart on Monday also announced a partnership with the Carbon Disclosure Project (CDP) to measure the amount of energy used to create products throughout its supply chain - many of which come from China.

Said CDP Chief Executive Paul Dickinson: "Wal-Mart will encourage its suppliers to measure and manage their greenhouse gas emissions, and ultimately reduce the total carbon footprint of Wal-Mart's indirect emissions. We look forward to other global corporations following Wal-Mart's lead."

China's leadership is not where Lee Scott is yet. Chinese officials still put their highest priority on growing GDP - their bottom line. But for the first time, the costs of this breakneck growth are becoming so obvious on China's air, glaciers and rivers that the leadership asked for briefings on global warming. Many Chinese mayors are looking to get clean-technology industries - such as wind turbines and solar - started in their cities.

At such a key time, if the U.S. government adopted a real carbon-reducing strategy, as California and Wal-Mart have, rather than the obfuscations of the Bush team, it would have a huge effect on China and only trigger more innovation in the United States.

Bush will be convening his climate photo op - oops, I mean "conference" - in Washington, D.C., on Thursday, which will include Chinese and Indian officials. But, as Rob Watson, the CEO of EcoTech International, which works on environmental issues in China put it: "The Chinese are not going to take anything we say seriously if we don't set an example ourselves."

Leadership is about "follow me" not "after you." Getting our national climate regulations in order is necessary, but it will not be sufficient to move China. We have to show them what Wal-Mart is showing its competitors - that green is not just right for the world, it is better, more profitable, more healthy, more innovative, more efficient, more successful. If Wal-Mart can lead, and California can lead, why can't United States?

Thomas L. Friedman, a columnist for The New York Times, can be reached at The New York Times, editorial department, 229 W. 43rd St., New York, NY 10036.