A recent article in today's New York Times details the perils of an industry that is greatly impacted and propped up by government regulations: the recycling industry. Recycling, like any business, it has its up and downs. Prices for recyclables can vary widely from one year to the next, making the industry more or less competitive with other disposal options like landfilling. Because recycling has an almost religious following that makes it a politically popular industry, everyone laments when waste goes to a landfill because the recyclables have little value in the marketplace, as is the case today.
But why? The price of disposal/landfilling represents the resources used. So if landfilling is cheaper, it makes economic and environmental sense to landfill. Problems arise when governments set up programs and policies to support one industry over the other. In this case, governments and their contactors are stuck with nearly worthless recyclables, that they already spent resources to collect. Now much of that trash is going to the landfill—where much of it probably would have gone had there been no government program.
Some cities are abandoning recycling at least until market conditions change--which is a smart idea. But places like New York will continue to run uneconomical recycling programs, wasting away taxpayer dollars. Some cities are even spending taxpayer dollars to stockpile garbage in warehouses with the hope prices will rise soon. New York and other cities would be much wiser to go with the most affordable disposal option and use the money they save to reduce tax burdens and help spur local economies. Unfortunately, that won't happen in places like New York as government officials would rather throw away taxdollars to protect a sacred cow. After all, at the end of the day, it doesn't hurt their bottom line!