How do we get to “an economy that restores”?
As a continuation of my topic from last week, about the value of recycled products, this week I’m considering the slump in prices for recyclables and how to remedy it.
Via Eco-Cycle’s newsletter, I learned that this Boulder County nonprofit will see its revenues drop by half in 2009. But some recycling authorities are seeing prices drop by 90 percent, so a 50 percent drop seems, well, good. Or at least survivable.
It’s not just happening in the United States. The UK is feeling the pain too. The reason? The enormous markets for recyclables that existed in China have contracted, because China has cut back on manufacturing in response to global economic problems.
So recycling organizations are stockpiling glass, plastic, and aluminum and hoping the markets rebound. And Cobb County recently decided to compost cardboard rather than try to sell it for almost nothing.
What would be a way to drive prices back up?
Last week I said I’d like to see more utilitarian products made from recycled materials.
Suppose that a hotel chain like Hilton Hotels, where I spent the last two weeks, decided (or was required) to build with recycled materials wherever possible. Suppose 50 percent of the construction materials in a Hilton Hotel had to be made from recycled plastic or glass or metal.
Imagine the demand Hilton Hotels could create for used doors (or doors made from recycled plastic, like Trex decking).
Think it’s not possible? Look at this page from the American Chemistry Council. Or go back to last week’s post and look at the list there.
A wide array of products are made from recycled materials nowadays, and it wouldn’t be that difficult to create new products. All that’s required is a market.
If the U.S. government laid down a few rules about this, it could spur the growth of huge new markets, create a lot of jobs, and save energy and resources in the process.
I would prefer, actually, that Hilton Hotels make this decision by itself, but I just don’t think the private sector has the motivation to move quickly in this area. I think prodding is needed.
{ 7 comments… read them below or add one }
I think the responsibility to get Hilton Hotels or anyone else on board with a project like that is for the company making the recycled parts to sell them. Having the government make rules forcing companies to buy from recyclers will not work. Recyclers making a viable product, and then marketing it in a way attracting legitimate sales is the only way the idea works.
I agree, any attempt to artificially control the market will fail. I see this as a PR problem. If Hilton was convinced that people would choose Hilton more—and pay more—if Hilton used only recycled doors, you can be sure Hilton would use only recycled doors. And for that to happen, us people need to be willing to pay more for a hotel that uses recycled materials.
I think the underlying problem is that it’s not significantly cheaper to produce doors, for example, from recycled materials than from harvested wood. You can’t make recycled doors cheaper so you have to make them more valuable. That’s a marketing/PR problem.
But what if the incentive is to reduce waste? The government is generally the entity that handles waste disposal, and if it decides that it is in the interests of the nation to reduce waste significantly, construction debris is a good place to start.
I don’t think that setting targets for companies is a bad way to spur change. They would be able to choose their supplier or set up one if they couldn’t find a suitable supplier.
I also think it would create jobs.
Fascism: an authoritarian nationalist ideology focused on solving economic, political, and social problems that its supporters see as causing national decline or decadence.
Sorry, Beth, but the more government involves itself in the market, the closer we are to embracing Fascism.
Well, Bernard, if that’s the case, then we were a fascist nation when the Homestead Act was approved and the government started handing out land for people to settle. And we were a fascist nation when we gave subsides to the oil companies and to farmers.
Government has always been involved in the market. It’s just a question of to what end.
Also, I don’t think that’s a very clear definition of fascism. By that definition, the cooperation between government and business during World War II was fascism.
While I see no similarity between the Homestead Act or the government buying needed products during WWII, and companies supplying them as even close to the definition, I would agree subsidies of any form are flirting with it. Government subsidies create a false market and are utter failures, which was my original point.
Bernard, the Homestead Act and WWII were cases in which the government worked with the market to achieve an end it desired: in one case, settling the West; in another, getting needed war products. There’s no question that in those two cases there was more direction than usual from the government as to what it wanted.
Here’s another example: some twenty years ago the Japanese government asked Japanese car companies to design more fuel-efficient cars because the government saw dependence on foreign fuel supplies as a problem. The companies complied, and now Toyota and Honda are raking it in (or were, until the third or fourth quarter of 2008. I believe Toyota posted its first loss ever in that quarter).
Would you say that what government support or subsides were given to Toyota and Honda created a false market? If so, then that false market is employing US citizens.