Category Archives: Mining Subsidies

Uprooting Subsidies: The Next Frontier in Product Stewardship

Last month I was fortunate to have been asked to present at the Northeast Resource Recovery Association’s 30th anniversary conference. One of my assigned topics was “Product Stewardship in 30 years.” Initially, this task seemed daunting…until I realized that I could say almost anything since no one knows exactly what will and won’t happen 30 years from now.

As I combed through my litany of what-could-bes, I considered the notion that 10 years of U.S. product stewardship might have finally positioned us to reach far upstream to reduce product impacts, and set us on the path to true sustainability. I even went so far as to say that the current conservative Congressional winds might just open the door to the removal of subsidies underpinning product un-sustainability.

During the question-and-answer period, one of our friendly participants asked me if my cause for optimism was justified. After all, many conservative politicians don’t give a hoot about environmental protection if it means that industry and consumers must pay for added social and environmental protections. Yet members on both sides of the political firestorm are increasingly focused on eliminating subsidies (tax breaks) due to a panic-inducing budget deficit.

First on the chopping block are ethanol subsidies.

Some thirty years ago, when a confluence of circumstances pushed the concept of alternative fuels to the forefront of Congressional consciousness, those growing corn for use in ethanol production received handsome federal subsidies. No thoughtful lifecycle assessment determined if this industry was sustainable. And there was no widespread public debate on the various potential alternative fuel opportunities. But in the heartland there was a focused political interest feeding off homegrown corn that couldn’t be eaten. Age-old ag subsidies, totaling $30 billion over the next decade, are now under attack as anti-subsidy proponents point to biofuel mandates that preempt the need for ethanol subsidies.

The political equation is fraught with fretting, yet the slash-and-burn, subsidy-removing, equalizer sword that conservatives wield at the peril of losing the Iowa primary could effectively level the playing field for sustainable energy as well as sustainable products. And many appear eager to use it.

I am fully supportive of the strong backlash against subsidies. The Product Stewardship Institute’s main objective is to level the playing field for products. Focusing on a product’s end-of-life management is a huge task. But let’s face it, that movement started over 20 years ago in Europe and Canada, and spread to the U.S. 10 years ago. That movement is in full swing. The movement begging for attention relates to the unequal playing field created by subsidies, which causes truly “green” products to be at a competitive disadvantage to those products that only claim to be green, or products that cut consumer price tags but raise societal costs.

This is the next phase of the product stewardship movement.

One of PSI’s goals is to encourage consumers to choose products based on their environmental and social attributes. That is a huge endeavor, considering those attributes often fall behind in product effectiveness, price, and availability. We are still unable to thoroughly and accurately compare the environmental and social attributes of different products. PSI’s green washing webinar  highlighted the plethora of environmental claims, certification companies, and public confusion over which products are truly environmentally preferable.

But if we look behind this external curtain, we begin to understand that the product manufacturing system must be challenged. Mining subsidies (150 years old) give millions of dollars each year to companies that extract raw materials from the earth at a time when we are desperately trying to promote the use of recycled materials.  Additionally the lack of company requirements for clean-up operations has left 500,000 abandoned mines, polluted 40 percent of western watersheds, and racked up a bill estimated between $32 and $72 billion (not including currently operating mines). We know similar subsidies occur in other sectors like the timber and virgin paper production industry, which allows special tax rates costing taxpayers $440 million a year. Another recent PSI webinar, on mining subsidies, captured these excesses.

If we look closely, there are subsidies everywhere, particularly if that term encompasses society’s subsidization of companies that do not internalize the true costs of their products. And that is the heart of product stewardship. Our movement, across the entire product lifecycle, seeks to require companies to assume the full costs of making products. I do not want to subsidize corn growers for making ethanol, thermostat manufacturers for making sure their mercury thermostats get collected, mining companies for extracting gold to be used in electronics, or any company for costs that society must bear because of that company’s business decisions.

That is a long way of saying that, yes, I am optimistic that now is the time to sound the subsidy issue alarm, and to level the playing field for those  businesses truly seeking environmental and social equity. I have no illusions that those rallying for subsidies will stop, or that others will join the effort. But the time is ripe to bring these issues into greater focus and educate ourselves and the public about what we really mean by product sustainability.

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It’s Dark Down There: More Reasons to Recycle

Below is a blog post by Tom Rhoads, Executive Director of the Onondaga County Resource Recovery Agency in New York State in preparation for the PSI Networking Webinar, “Promoting the Extraction of Virgin Materials: How Subsidies Impact Product Sustainability,” on Wednesday, June 15th (2:00-3:30 p.m. EST). Please join us for the dialogue.

We can never get too many good news stories in this day and age. The Chilean miners’ rescue is certain to be one of the top stories of the year for 2010. I was born in a mine town, and although I never spent a full day working underground, I have toured several deep mines. The darkness is absolute when the lights go off. You literally cannot see your hand in front of your face. To be trapped thousands of feet underground is, for me, incomprehensible. To carry any faith in rescue after days of no contact was marvelous and probably a genuine life saver.

I recently read that these miners were harvesting copper ore that was less than one percent copper. Copper is a common metal, but its value has risen enough to drive men 2,300 feet below the earth’s surface. In previous accidents at this very same mine, men died for ore with one percent copper.

Many other metals and minerals are hotly pursued across the globe. Mines in remote Canada and Indonesia have become targets of billion dollar investment takeovers. China made recent world news and sent ripples down economic spines when it declared a suspension to the export of so-called rare earth minerals (those needed in everyday electronics, communication devices, and high-tech batteries and magnets common to many tools and most high-efficiency transportation.)

Can you guess where I am headed? In the United States, only about 60 percent of the U.S. population even has access to basic curbside recycling for containers and printed materials. (USEPA, 2008). In New York, I travel through several areas that offer no curbside recycling for packages, containers, and printed materials. Zero recycling. You see, recycling and recycling infrastructure have a cost. That cost is in addition to the cost of trash disposal. The regional agency I work for, the Onondaga County Resource Recovery Agency (OCRRA), uses the revenues we earn from trash disposal and recovered energy from the trash to pay for the entire program. OCRRA’s disposal fee is more than the cost of landfill disposal, but OCRRA’s tipping fee covers the costs and benefits of Household Hazardous Waste Events, recycling infrastructure, battery collections, free recycling assistance and supplies for businesses, Earth Day Litter Clean-Up, OCRRA’s newsletter, and much, much, more. Even the curbside blue bin for recyclables is paid for with the trash disposal tipping fee. The cost of these programs puts pressure on OCRRA’s tipping fee and the resources of many other local governments providing similar programs. And as we continue to reduce the amount of trash through waste reduction and recycling programs, OCRRA (like many other local governments) is actually penalized for its recycling efforts with reduced revenue in its primary funding source – trash disposal fees.

We constantly reflect on how to pay for waste reduction and recycling programs. But there is a better question to consider: what does it cost us not to recycle? When we send miners into remote and deadly environments, because it costs a little more up front to develop recycling infrastructure, is that really the way to keep score? If China has a lock on minerals needed for the next generation of economic growth or energy-efficient technology, can our children (and their children) really afford us tossing away cell phones, batteries, or old electronics that are far richer in mineral content than ore from a mine?

I hope you agree that these and other similar questions need to be asked when we discuss the cost to recycle, or how to pay for a system that places a priority on reduction, reuse, recycling, and recovery before landfilling.  Extended Producer Responsibility laws for e-waste have been tremendous vehicles to fund e-waste recycling infrastructure across the U.S. EPR strategies also have worked in Canada and Europe for other recyclables as well – including packaging and printed materials.

The faith of the Chilean miners to be rescued was probably their life saver. Faith in rescue, leadership during the crisis, oh yeah – and a $20,000,000 rescue effort watched by the world for 69 days; those were the story lines in Chile in 2010. Perhaps we can also consider that product stewardship by the manufacturer (thereby better engaging the consumer) for waste reduction and recycling is the form of leadership needed to avoid another crisis-making headline in the future.

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