The Crony Air Polluters of China?

I recently spent some time discussing China with a friend who who had just returned from a trip to Beijing and Shanghai. He tells me that the air pollution is so bad that even locals, who can afford to,1` are leaving the country.

WSJ has an article out, Why Leave Job in Beijing? To Breathe, discussing the problems of getting workers to move to China:

After Beijing's air-pollution readings soared in January, local executives for German auto maker BMW  received bad news: several candidates for midlevel expatriate jobs withdrew their applications.

"They called and said they no longer had the support of their families," said Kirk Cordill, managing director and CEO of BMW Group Financial Services China.

BMW isn't alone. The European Union Chamber of Commerce in China says air pollution is a key challenge facing companies here, and is an underlying reason why many expatriate workers choose to leave. Soaring levels of pollution are driving expatriates out of Chinese cities, and dissuading others from coming. That is a problem for many multinationals who need to attract some of their brightest and most experienced executives to China at a time when the Chinese market is becoming central to their global success[...]The impact of high air-pollution levels on long-term health weighs on Chinese and foreigners alike. A recent analysis led by the Boston-based Health Effects Institute estimated outdoor particulate matter in China was responsible for roughly 1.2 million premature deaths in China in 2010, ranking it just behind tobacco smoking.

Which raises the question: Why is pollution such a serious problem in China?

The answer can't be a technical one. It would be very easy to determine who is causing the pollution and force them to stop. The answer lies with the government in China ignoring a basic private property right. Walter Block discussing the matter in a general way and not specifically relative to China has written:

The reason we have [air pollution] at all is due to a government failure to uphold private property rights, in that pollution is merely and simply an uninvited border crossing, a trespass of dust and other particles, as it were. 

But still, can't the Chinese government at this point recognize the problem and stop it, even if they are blind to the private property rights argument? The answer is that they must be aware of the problem. So why is the government allowing the pollution to continue? The answer must be that the polluters are crony polluters with ties and influence over the government.  The cost to these polluters to either stop the activities which are causing the pollution or implement techniques that would minimize the pollution must be so high that they would rather influence the central planners and keep the pollution going.

It's crony air polluters and a Chinese government they can influence. From a distance that's what it looks like to me. It's a good research project to see if my theory fits the facts, for anyone in a government or economics class.