Why Shifting Financial Responsibility Is a Bad Way to Reduce Waste

State lawmakers around the country have decided to be more aggressive about reducing waste. They are particularly concerned about plastic waste given that so little of it is actually recycled. What is their latest ploy? To reduce waste by shifting the financial burden associated with recycling it to producers. What seems like a noble idea is actually a rather bad one.

What we are talking about here is a very specific type of waste. States like New York and New Jersey are intent on eliminating things like plastic grocery bags, foam food containers, and all sorts of plastic packaging used by food manufacturers. This is very different from the industrial plastics that have been successfully recycled in this country for decades.

Lawmakers seem to think that making producers pay the costs associated with recycling their plastics will force them to be more responsible about their packaging. Ultimately, the long-range goal is to convince them to stop using plastic altogether. It is not going to work. Furthermore, it’s going to create additional problems.

Still a Money Loser

Among the motivations state lawmakers cite for enacting their new recycling laws is the fact that consumer plastic recycling is a money losing proposition. Municipalities spend millions of dollars on recycling efforts that do not generate a dime of profit. State lawmakers want to shift that responsibility to manufacturers, thereby alleviating municipalities of a rather large and recurring expense.

Shifting the financial burden does not change the fact that recycling is still a money loser. And ultimately, shifting responsibility is not going to save taxpayers. They may not have to pay for recycling through local taxes, but they will pay for it through higher prices at the cash register. That is because producers will simply pass on their costs through higher pricing. Meanwhile, it’s virtually guaranteed that state and local government will not reduce tax rates when they no longer have to pay for recycling. So in the end, consumers will ultimately pay more.

Determining Who Pays the Bill

When states enact burden shifting legislation, they create an administrative nightmare associated with determining who actually pays the bill. Simply put, who is the producer of a given form of plastic waste? Is it the company that produces the resin that eventually becomes plastic food packaging? Is it the company that turns that resin into food containers? Is it the company that uses the food containers to package its products?

Once that question is settled, you have to deal with the fact that a lot of the products lawmakers are taking aim at contain more than one type of plastic from more than one manufacturer. Who are recyclers supposed to bill for dealing with those types of products?

A Lesson from Industrial Recycling

As usual, politicians take a shortsighted view by going after producers rather than consumers. It is easy to shift responsibility to the business world despite the fact that businesses are only responding to consumer demand. But really, the only way to deal with the plastics problem is to learn a lesson from industrial recycling.

Seraphim Plastics, a Tennessee company that recycles industrial plastic waste, is among a group of companies that have successfully recycled plastic for decades. They succeed by putting the responsibility for separating and cleaning on the customers from whom they purchase. Problem solved.

We could end the alleged consumer plastic crisis by changing the way consumers use plastic. If we continue the foolish policy of going after producers, the only goals realized will be scoring political points and raising consumer prices. The plastic problem will continue unabated.