According to President Donald Trump, trade wars are quick and easy to win.
However, trash haulers and recycling companies across the nation and the region will tell you about a trade war that’s dirty, long-lasting and a losing proposition.
Since late last year, China has been raising its standards for accepting millions of tons of recycled plastic and paper, in many cases reducing the amount of contaminants it will accept by more than 90 percent.
That has caused prices to plunge and costs to rise for large companies like Waste Management and smaller firms such as Harrison Industries and its Gold Coast Recycling subsidiary.
Today, plastic and paper are piling up at recycling facilities, picking lines are moving slower in order to remove contaminants and the looming option is a diversion to landfills that will threaten to end lofty goals for recycling set by many communities and states.
Reporting by Bloomberg News on page 9A of this edition of the Business Times underscores the size of the impact. China has imported 106 million tons of old bags, bottles, wrappers and containers worth $57.6 billion since the early 1990s. That’s equal to more than 50 percent of the world’s recycling exports during that time.
The added costs to meet the standard have prompted the first request for an extraordinary rate hike since Gold Coast went into business in 1990. The longer-term results are bleak. By 2030, an estimated 111 million metric tons of used plastic will need to be buried or recycled in Malaysia or another country.
The trash mess that has washed back on U.S. shores is an example of what happens when complex systems of global trade are disrupted. The Chinese are not imposing tariffs on U.S. imports, as the new standards are what might be called a “non-tariff barrier” to trade. The new standards give the Chinese the ability to say they are merely acting to be more environmentally responsible.
A more flexible system or a more predictable path to clean up recycling efforts would have been much easier for area recyclers to adapt to.
Now the system that had been in place since the early 1990s has broken down, and there’s no fix in sight. Moreover, if the Trump administration succeeds in slowing the growth of the Chinese economy over the long term, the price of recycled plastic and paper will be permanently depressed.
IN MEMORIAM: GEORGE LAUTERBACH
George Lauterbach was an architect, a successful construction firm owner and a leading philanthropist in the greater Oxnard area. He was well known as a person who designed many of the open space and recreational areas in west Ventura County.
A graduate of Cal Poly San Luis Obispo, Lauterbach was an early supporter and board member at the Economic Development Collaborative, where, as CEO Bruce Stenslie recalled: “His thoughtful guidance contributed enormously to my transition into the work of economic development.”
Lauterbach, 79, died earlier this month after a long illness. A memorial service is planned for 5 p.m. June 30 at the Channel Islands Maritime Museum. In lieu of flowers, the family requests that donations be made to the George Lauterbach scholarship fund at Oxnard College.
Our condolences to his family and his many friends and associates.