No Shit, Sherlock: "Economists Say China's Smog Is No Joke" - LA Times
Gosh, an externality you can't set equal to zero. 
EDIT
Residents in the capital have taken to mocking their famously filthy air and its attendant health hazards with the expression "Beijing cough." Meanwhile, Shanghai's Environmental Protection Bureau has introduced a cartoon mascot to communicate daily air quality on its website: a pig-tailed girl who bursts into tears when smog reaches hazardous levels.
But economists say China's smog is no joke. As air pollution continues to obscure China's cities, the cost to the nation in lost productivity and health problems is soaring. The World Bank estimates sickness and early death sapped China of $100 billion in 2009, or just under 3% of gross domestic product. China is now home to seven of the 10 most-polluted cities in the world, according to a report by the Asian Development Bank and Beijing's Tsinghua University.
A study by Greenpeace and Peking University's School of Public Health put the cost of healthcare to treat pollution-related ailments in Beijing, Shanghai, Guangzhou and Xian at more than $1 billion last year.
Beijing resident Zhang Jian takes his 2-year-old son to a doctor regularly to treat the toddler's chronic sinus infection. "It's definitely related to the pollution," said Zhang, 35, who wore a disposable mask at an overcrowded children's hospital recently. "My son snores and his nose is blocked constantly. It's a problem because he's too young to clear his nose like adults." The doctor's visit and treatment cost Zhang about $320 — nearly a week's pay for the IT professional.
EDIT
http://www.latimes.com/business/la-fi-china-smog-20130126,0,885158.story
= new reply since forum marked as read
so this is good news!
