Realist, not conformist analysis of the latest financial, business and political news

Now That China Won’t Take The Waste We Should Stop The Recycling

The Financial Times has a long read about how the world’s recycling market has changed now that China refuses to take the refuse off our hands. Floods of it are arriving in other poor countries and they are gradually choking off imports. So, it’s all piling up where we the people producing the waste live. This does, as the FT rightly points out, increase the cost of any recycling that might be done. Doing recycling in a high labour cost place doesn’t work as well as doing it in a low labour cost place.

Sadly, the discussion doesn’t then move onto the important question – given the change in price should we be recycling at all? The answer, in a rational world, at least potentially being yes we should stop. But such is the manner of modern mores that no one actually is asking that one, sole, important question.

On December 31 2017, China, previously the centre of the global recycling trade, abruptly shut its doors to imports of recycled material, citing the fact that large amounts of the waste were “dirty” or “hazardous” and thus a threat to the environment. The prices of plastic scrap collapsed, as did the price of low-grade paper. Suddenly, the lucrative trade that had sprung up shipping recyclables around the world was in crisis.


China’s ban has also laid bare the uncomfortable economics behind household recycling, and triggered a profound re-examination of the practice — one that many say was long overdue.

As it should.

Globally, about half the plastic intended for recycling is traded overseas, according to a recent study in Science Advances. That percentage is even higher on the US West Coast – California exports two-thirds of the stuff tossed into household recycling bins. Many cities that previously received revenue from their recycling programmes now have to pay hauliers to dispose of the material instead. At the beginning of 2017, a bale of low-grade mixed plastics could fetch $20 per tonne in California, but a year later it cost $10 to dispose of it.

The National Sword policy “challenges us to admit that recycling isn’t free”, says Zoe Heller, assistant policy director at the California state recycling agency, CalRecycle. “What this is really bringing up for California, the US and the rest of the world is that there has to be a paradigm shift in how we think about recycling globally.”
What it’s showing is that recycling is a loss making activity. If you’ve got to pay to have it carted away then the cost of processing the stuff is less than the alue of what it is processed into. That is, this is a loss making activity. It subtracts value from our civilisation.

Another way to make the same point is that recycling consumes more resources than not recycling. Thus if we want to save resources then we should not recycle.

Do note this is not to therefore state that we should just throw it all into the ocean and choke the whales. We still have a waste management problem. We should landfill the stuff, burn it perhaps. But we shouldn’t recycle it, the third and most expensive option. Simply because it makes us poorer to do so, it consumes more resources than we gain from the process.

Nor is this to say that all recycling is a bad idea. If the stuff itself has a positive value – say some nice scrap steel – then recycle by all means. That positive value, that profit gained from performing the process, is the very proof that value is being added by doing so. We like value being added, it’s the definition of making us all richer – just as making a loss is the definition of making us all poorer.

At which point that vital point. As the price of recycling has just changed then we have to evaluate whether recycling should still be done. We cannot say that recycling must be done whatever the price. Or at least we can but we’re damn fools to do so.

To switch examples just for a moment, consider radiation. Not good stuff, generally not nice and we think we’re best to avoid it. But not always. There are, for example, medical treatments which use it. Some of which leave the recipient of the treatment sufficiently radioactive that others are advised not to get too close to them for a couple of days. Yes, this level of radiation can indeed harm the person being treated. But that harm is outweighed by the good that can – the best we can say, can – be done to the disease that they’re suffering from. And that level of radiation is definitely harmful to those not suffering from that select set of diseases that might be aided by the radiation treatment.

That is, even with something like radiation we weigh the costs and benefits. Just as we should absolutely anything else that we want to think about. What are the costs, what are the benefits? If the latter outweigh the former then we should go ahead and do it. If not, don’t.

So, we want to know what the benefits of recycling plastics are. No, not what the benefits of the management of plastic waste are. Take those costs of either landfill or incineration as our baseline. We gain the benefit of not polluting with plastic at some cost in the collection of the plastic. Great, OK, start there. So, what extra value does recycling plastics bring? At what cost?

Now, that cost before was $x. Now it’s $x+. Super – does recycling plastics bring us $x+ in benefits over and above those alternative methods?

The answer, obviously, is no, given that plastics for recycling have a negative value. So, therefore, we should stop recycling plastics, shouldn’t we?

That being the one thing that no one is saying and the one thing that the price change should have us saying. Which does rather show us how badly society is gripped by the recycling mania, doesn’t it? To the greater poverty of both the present and the future, unfortunately.

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Rhoda Klapp
Rhoda Klapp
2 years ago

Penn & Teller in their ‘Bullshit’ programme did this one yonks ago and introduced a rule of thumb, that nothing is worth recycling if someone will not pay you to take it. That’s a couple of Vegas magicians. It’s been obvious for years while those obsessed with the practice would not even discuss the sense of it.

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