Tierney & Recycling Economics

Fri, 22 Jan 1999 16:21:32 -0500

Hi Bill,
I don't know the protocol for posting to the new e-mail site, so I'm sending
this to you at the old address. Perhaps you can forward it. This is our
response to an especially snide reprise of Tierney that appeared in the
Seattle Times on 7/10. I don't yet know if the Seattle Times will publish
it. It may be too detailed for the newspaper, but the specific details are
how I at least can show the egregious error and bias of these recent blasts
at recycling.
I'll see you at the grassroots meeting in Pittsburgh.

Editor, The Seattle Times:

On behalf of everyone at Sound Resource Management I want to express vehment
outrage at Thomas Sowell's snide and ill informed column on recycling.
Journalists and editorialists too lazy to do adequate research should follow
their own advice and not recycle blatantly worthless mutterings. Sowell
reprises John Tierney's garbage article from The New York Times Magazine
which relied on research conducted by Franklin Associates for Keep America
Beautiful (KAB) and by CSI Resource Systems for the Solid Waste Association
of North America (SWANA) to prove recycling is too costly.

Never mind that these two studies virtually ignored all those long-standing,
private-sector recycling programs that are overwhelmingly cost-effective --
drop-off/buy-back centers, retailer cardboard recycling, on-site paper
collection from businesses, scrap metal recycling -- and have been supplying
feedstocks to major manufacturing industries ssuch as stell, paperboard and
glass for decades. Both studies also fumbled their analyses of residential
curbside programs:

1) KAB and SWABA used recycled commodity prices from 1992-93 when markets
were at historic lows. E.g., KAB severely underestimated the economic
benefits of recycling by assuming that average revenue per ton for selling
residential curbside recyclables (including mixed paper) would only amount to
$29. In fact $59 is the eleven-year average revenue in the Seattle area,
ranging between a $30 low (June 1993) and a $169 per ton high (June 1995).

2) KAB neglected to include transfer and hauling expenses on the garbage
costs side. Virtually every urban area has a garbage transfer system to save
garbage collection trucks from having to drive to out-of-town landfills. For
Seattle these transfer and haul costs to an Oregon landfill amount to about
$50 per ton. For King County areas outside of Seattle transfer and haul
costs to the local landfill average $24 per ton.

3) To calculate recycling costs in Seattle, SWANA lumped curbside and
non-curbside recycling program costs together. Programs such as apartment
recycling were in the start-up phase, when costs are high and tons recycled
low. Other programs such as white goods ( discarded appliance) recycling
incur high costs and low revenues, but are provided because the materials
cannot be safely thrown into garbage. Therefore, SWANA's study cannot be
used to make conclusions about the net cost of normal, ongoing recycling
programs such as residential curbside collection.

4) KAB and SWANA presented recycling costs and benefits for only a single
year, ignoring future cost savings made possible by recycling today. Both
Seattle and King County include future disposal cost savings when analyzing
the economic benefits of recycling. For example, King County's economic
analysis of recycling includes closure of the local County-owned landfill and
subsequent waste export to a more distant privately-owned landfill at
substantially increased cost. By extending the current landfill's life,
recycling programs push these higher waste export costs into the more distant
future. In addition, recycling substitutes known present costs for unknown
future costs, an especially important consideration given potential risks
attendant to burying garbage in landfills.

In more general terms the KAB and SWANA studies are egregiously biased
because they failed to consider the evolution of waste management from
"garbage first" to "3Rs (reduce, reuse, recycle) first." The KAB and SWANA
paradigm envisions the former and asks, "Wouldn't it be cheaper to bury
everything in the desert?"

By contrast, the 3Rs first paradigm envisions wasted resources in garbage and
asks, "Wouldn't it be cheaper to reduce the amount of resource extraction by
using or making useful all that which we now waste?" The latter paradigm
gets us on the road to designing collection vehicles that can collect
organics, recyclables, and a little residual waste on fewer than three
trucks, perhaps less often than once per week. It starts us looking around
for processors and manufacturers who can locate in our communities and make
use of those resources currently thrown in the garbage truck. It focuses our
planning and analysis on designing for resource conservation and waste
minimization, rather than for more perfect tombs to store more stuff, from
benign glass to deadly plutonium.

Enough is enough! It's time for these purveyors of garbage verbiage to put
up or shut up! I will go anywhere at anytime to discuss/debate the economics
of recycling with Bill Franklin or anyone else from Franklin Associates, Alan
Cohen or any other representative from CSI Resource Systems, John Tierney,
Thomas Sowell, and/or Jeff Bailey (author of similarly condescending and
inaccurate articles in The Wall Street Journal and Readers Digest), provided
that the discussion is moderated and judged by a reasonably objective body of
experts/scientists. Let obfuscation cease and the truth prevail!

Jeffrey Morris, Ph.D.-Economics