Statistics and Perception

I'm always grateful that I was impressed by things I was dumb about. Math and statistics, I mean. I kept demonstrating mathematical genious potential in standardized tests (which I now attribute largely to strategies I developed for test taking, later taught by Kaplan). That, with the attitude that anything I was uncomfortable with in learning could be approached like a monk approaching fasting, led me to keep retaking courses that did major damage to my GPA.

So statistics, I took in high school at the U of A and got a C. I took it again at Carleton, and got a C+. I took it again at the U of A after Peace Corps and got I think an A or a B. I took it a fourth time in the MBA program and I think I got an easy B.

What's important is that you can understand derivatives and quantum physics if you have a general knowledge of stats. You can start to discount things you perceive, and appreciate them but put them in context.

This allows you to see the difference in sports highlights between a home run shown because the story is about David Ortiz (the most underpaid power hitter, dog bites man again) or because a National League Pitcher with a 186 average hits his first home run (man bites dog).

When people read about a stereotype and then see the stereotype reinforced, they can begin to feel more confident in their misperceptions....

Ok had a lot more to say but the presents are being opened and no one understands why I'd be blogging on Christmas morning....

Response to BAN

Jim Puckett and Ms. Sarah Westervelt Basel Action Network 1305 4th Ave., Suite 606
Seattle, WA 98101


Dear Jim and Sarah:

In March 2005, our company, American Retroworks Inc., DBA Good Point Recycling of Middlebury, Vermont, commended your organization's efforts to “raise the bar” on exports to poor countries. We offered an explanation of what we do, which is legal (under Annex 9), ethical, and environmentally preferable. BAN voiced two concerns and questions about the process, which we have tried to address.

  1. Functionality test (BAN's preference for “tested working” parts exported for repair)

  2. Recycling of upgraded parts

We have tried to address both concerns. The result is a zero-waste process involving remanufacture of used CRTs in a manufacturing take-back program in Malaysia. We have visited the factory, and audited its processes. We have developed a comprehensive accountability system to ensure that the factory gets only what it needs. We have established 95% reuse, we have an import permit, and under our direction the factory has entered into ISO14001 and ISO9000. We have asked them to adapt R2 standards, and they have agreed, and the 5% fallout is legally recycled. We have a testing procedure which actually measures fallout (lower than new product sales returns in the USA). We have filmed the process. We held the company and its other USA suppliers to contractual obligations, recycling Of

Of the 24.5% of material we export, we have offered to allow BAN access to the process, and to pay BAN to perform the audit. Based on our last email exchange, BAN has determined in advance that our process would not pass the audit based on the second concern, removal of “bad” materials. What we have done is to insist that materials removed, if any, must not become waste. However BAN is stating that IF any component is removed, it became a waste in retrospect, whether the part is ultimately recycled or not. Under that interpretation, if a buyer voluntarily upgrades a stick of RAM, that a transboundary shipment of waste has occurred. Under that interpretation, assembly (commonly outsourced by OEMs in the west) is also illegal, and we suggest that 100% of laptop sales should be banned, since there are residuals from the outsourcing of new product assembly.

The terms of the Pledge are BAN's to establish and enforce. However, BAN has created a catch-22 – the product must be “functional”, but any part which MIGHT be replaced MUST be removed. When it is removed, the product will not be functional. Functionality itself is a strange term, as the Basel Convention states:

"Re-use can include repair, refurbishment or upgrading, but not major reassembly."

BAN's seems to be saying that they can only repair, but not upgrade, tested working products.

We believe that as BAN proceeds on its current path of auditing and vetting the companies it lists (a very positive development), that you will find there are two types of companies:

  1. Those with virually no reuse, who process 95-100% of intact units, and who export the processed scrap.

  2. Those which reuse, according to whatever specification BAN adapts, but cannot reconcile shipments (as we do) or verify upgrades or incidental breakage.

The audit of the companies with zero reuse will find higher than 5% fallout (scrap also has de minimus contamination) and process waste, and the companies which export 'tested working' will be unable to prove product is not upgraded after sale. As more and more of your companies adapt #1, consumers will find it more expensive to recycle there.

It is simpler to allow an upgraded part to be properly recycled, to encourage refurbishers to undertake ISO14001 and R2 standards, and to reward them for doing so. Instead, BAN is making it virtually impossible for legitimate overseas buyers (including manufacturer takeback programs) to buy their product from BAN-accredited companies. If my company also refuses to ship there, the factory will have to choose whether to close (taking the very best actor off the field) or to source material from middlemen who get it from who knows where.

Your friend,


Robin Ingenthron.


A Ben Franklin by Now

With the massive increase in access to internet and education, reachable and readable wordwide, we should have had another Ben Franklin or Leonardo DaVincini, someone not formed by their job, by now.

Just TVs

The keyboards, PCs, printers, and cell phones represent 2% of the tonnage and 80% of the regulatory headache.

Good Product Stewardship


Good Product Stewardship legislation is like good surgery. It can be a lifesaver, something no one in their right mind opposes. And it is not unprecedented: end of life electronics recycling is just the latest in a long history of product stewardship regulations. The manufacturers of products have a role to play in warranty, in recalls, in product safety, in supply of replacement parts, in fair competition, and increasingly in environmental stewardship. It's what they call "a good thing." The right regulation protects consumers, and the marketplace, and the manufacturers themselves over time. It's true I've been to Christian Science services, but I take medecine and I've had elective surgery.

I would have trouble simply saying I am "pro surgery". Especially before Halloween.

Surgery on an arrow wound is a matter of life and death, even (if my education in westerns is reliable) if done with a pocket knife and a steak fork. You have to sterilize the knife with fire or alcohol, and give the patient a sedative or a glass of whiskey. But gettin that darn arrowhead out of the patient's body is critical, in conjunction with a process called "stopping the bleeding".

However, the human body is a delicate, multilayered organism. If the bullet is right next to the heart, but not in it, the patient has a pretty good chance of surviving. But here is where "medical school" comes in. You see, if you dig at the bullet this-a-way, you smash the aorta and the patient kicks the bucket. If you pry that-a-way, you slice the left lung, and your buddy the patient commences to cough up blood for the rest of his life. If you forgot to sterilize the knife, it's too late to go "oops" and take it out and wash it and go back in.

Now a lot of cowboy doctors could be forgiven if they are out in the badlands and they are forced to experiment with steak knives, pancreases, and arrowheads.

It seemed kinda like an emergency at the time, ol' Gus was a bleedin' and gettin' purty sleepy and what not. When I get back to the City, I'll go to med school and do my cypherin' and figure out what that gosh dang squishy pink thing was that the arrowhead was all lodged into.

Can't blame you, you done good, pardner. Get out the white linen.

Or what the heck, maybe you saved ol Gus. He wound up paralyzed from the waist down, and sure he only got one lung, but he was a goner and you and your steak knife will be braggin' to your grandchild how you saved his life up on Pokemup Flats that night.

When it comes to surgery, the question is, what is the emergency? The "precautionary principle" is that you need to weigh the actions before you take them. Chinese philosophy says that if you take action, like saving Gus's life, and he goes on to murder some innocent school marm, you share responsibility. That doesn't sit right in the West, and may be one reason that Western Medicine is more advanced than Eastern, despite a lot of evidence that Chinese and India residents are "wicked smart".

As western medicine has advanced, we become less tolerant of amateur medical practice. Today, if I operated on my son in my house with a really clean, really sterile, really sharp pocketknife, I'd go to a well lit prison, one with heat and air conditioning and a TV in my cell. This is because the "precautionary principle" requires that I weigh the true risks of not operating (the time it would take an ambulance to get my son from the back yard to the emergency room). I could not state as a defense that "doing nothing" would have killed the boy. I'm not in the badlands and it's worth taking a few minutes to get the surgery done right.

Product Stewardship is a great concept.

Two people at Vermont Agency of Natural Resources recently remarked to me thatGood Point Recycling "doesn't want to be regulated". That's kind of like saying I "don't like surgery". Hey, I could like surgery. Many of my best friends have hinted that cosmetic surgery has made great strides.

I just don't want to be experimented on.

The free market has a certain harmony to it. Most Americans pay their taxes, most Americans don't swear at toll booths, most Americans donate to charities. We have found that about 80% of Vermonters will pay about $5-10 to recycle a computer or TV about once every 5 years or so. We have found that getting convenient access to recycling to 85% of Vermonters (TVs collected 6 days per week in at least one place in their county) has increased Vermont's per capital recovery rate to 2+ lbs per resident, from zerosih six years ago. There is steady improvement, we have a few towns and districts still relying on a "one day" event once a year, but that's usually boiling down to a personality trait at the town manager level.

The 15% which don't have access... that's an interesting number in economics which I won't go into but which any Ph.Ds in econ can follow up with me by email. It has to do with diminishing returns, and what the costs are of addressing the last 15% of anything in any economy.

Anyway, how do we decide between good surgery and unnecessary surgery?

1) Define the problem

Several people have exaggerated the number of Vermonters unwilling to pay $5. It has repeatedly been said that high participation in a free event is proof that people won't pay for a non-free event. That's like saying that if I offer free coffee and the line is 10 times longer, that it proves that 9/10 people won't pay for coffee. It is a fallacy.

The real problem is that Solid Waste Districts and municipalities are hurting financially, and legislation which offers a 3rd Party financing system has to be considered as a way to pay for salting the roads in winter. This is a very legitimate consideration.

In Maine, consumers pay the same $5 per item as they do in Vermont, it's called a "transportation fee". See, they tell everyone the recycling is paid for by the manufacturer, but the manufacturer money goes to destroying working items that could ahve been resold, and so that money isn't available. That's like having cosmetic surgery that makes me uglier. So:

2) Propose a system that will work.

The fact that Oregon, Minnesota, Maine, Maryland and California all have different financial regulations has been criticized for being a "patchwork quilt" of regulations across states. For me, that's less disturbing by itself than the fact that five doctors I visit propose 5 different surgeries.

What someone needst to do is sit down and study the systems in place in those states, and compare their actual results to a "Placebo State" (Vermont) with no regulation, and vs. a very traditional treatment like a Waste Ban (Massachusetts and NH). The regulations in MA and NH appear to be working, so the test is whether the consumer and municipality benefit enough financially from the other systems.

3) Draw parameters or precautionary principles.

What are some things that good regulation will NOT do?

- diminish competition
- diminish solid waste hierarchy (reduce and reuse trump recycling)
- pass consumers more costs than they pay now for the same solution
- create a cowboy bureaucracy

We don't want elective surgery that corrects on problem and creates two others.

So am I being overly cautious and overly negative about exciting new types of product stewardship? Or am I helping us to improve so that Vermont's new regulations, when proposed, will be an improvement.

Here are some Product Stewardship laws from past years:

Planned Obsolescence laws. TV manufacturers must by law provide new replacement parts for all TVs they sell for 7 years. Did you know that had to be passed as a law? Did you know that some of the percursers to some of the current recyclers were in the business of taking out 7.001 year old replacement parts and grinding them up the minute OEMs are no longer required by law to stock them?

Product Safety laws. TV manufacturers and computer manufacturers are responsible for the safety of their products. That is why we have bromine mines - to mine the bromine for the brominated flame retardants which are laws dictate must be put into the plastics of electrical equipmment.

Competitive Laws. Free market competition must be protected actively by government. Competition has proven to superior to "redistribution of wealth", because if poor people can economize, they keep their wealth to begin with. It is amazing. The biggest criticism of Japan when I was going to school was that Japan cheated WTO rules by creating "non-tariff barriers" such as local regulation of products at the municipal and regional level which corporations outside of Japan could not effectively compete against. Who every heard of Acer (which bought Gateway) or Lenovo (which bought IBM) ten years ago? Would those brands have been on the list of "allowed to sell" products in Maine and Minnesota? What would the cost have been to the consumer if they had been kept out of the market? Who would Dell be today if internet sales had been disallowed in California following SB20?

Environmental lifecycle laws. There are other environmental laws to consider, including energy star, recycled content, longer lasting products, which represent vital life signs for the planet. If Hitachi is the undisputed champion of repair service, earning kudos from decades of TV repairpeople as being the most supportive and sustainable brand from a warranty perspective, that needs to be considered even if Hitachi is not doing 'takeback' things that other OEMs are doing. For us to pick one vital sign, like blood pressure, as the single indicator of environmental sustainabilty, is reckless and wrong.

So surgery is good.

Malpractice is bad.

I would have trouble simply saying I am "pro surgery". Especially before Halloween.

If you are going to operate on my kids, I am going to ask you tough questions. Just to label me "anti medecine" must surely be tempting. But we have a company here which is doing the right thing.

AND WHICH *** AHEM *** IS REGULATED!!!!!

If you go to EPA CRT Rule you will see that in order to export for reuse, we must keep detailed records demonstrating that the products actually were reused.

You will see that we cannot by law claim to be exempt if we collect CRTs in open top roll-offs exposed to the elements.

You will see that we need to keep records of shipments in and out of the company to prevent speculative accumulation.

You will see that if we do not recycle one of the CRT that we collected, and dispose of it in a landfill (arguably, a landfill in any country) that it is under RCRA a reportable incident and we must keep a record of it.

You will see that if we handle CRTs in a reckless manner which is likely to result in breakage, that we lose the "incidental breakage exemption". We can't tip the TVs in a roll off onto the ground mixed with refrigerators.

In good spirits, I'd suggest that if the current regulations were enforced, I'd have more faith that the proposed regulations won't just result in an out of state company undercutting our prices and undermining what we have built in Middlebury, Vermont.

My first suggestion to VPIRG was to draft the legislation for Televisions only.

- TVs are the financial problem
- TVs don't have as many competitive barrier issues
- TVs are the volume problem
- TVs are big and wind up going over the $5-10 / item charge
- TVs have fewer manufacturers to regulate
- If it works really well with TVs, you can always add keyboards later

"Doc, this procedure, have you ever done it before?"





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Compromise on Legislation

I've written before about the problems with involving manufacturers in a government-OEM-recycler-consumer-takeback-scheme. There are so many more things involved in the grey market, emerging markets, planned obsolescence, non-tariff barriers, etc. that it's difficult to imagine a scenario where the consumer comes away with their trousers still on.

However, as the attraction of "free money" (fees from manufaacturers) collects steam with recycling officials and other government officials, it's difficult to turn back the tide. Vermont's legislation has died not quite a thousand deaths, but it's going to rise again.

My compromise is to apply the legislation to Televisions only.

1) TVs are relatively simpler than computers. There is less of a conglomeration of hard drives made by Seagate, boards made by Intel, software made by Microsoft, CRTs made by Trinitron, and a brand name who contracts out to an assembly company. The "white box" or independent manufacturing market is not as big a player in the USA for TVs.

2) Aside from all the OEMs involved in the "original" manufacture of a single PC, there are fewer brand players to involve in a TV takeback program.

3) The TVs are the biggest cost associated with the electronics or "e-waste" collection system. PCs are worth money, and in Minnesota the manufacturers fell over themselves to sign up tonnage already being collected in the free market - commercial builing PCs.

4) TVs are about to go obsolete, both because of the CRT and because of the digital tuners. That's a bit of an exaggeration, but it is indisputed that the secondary market for TVs is a fraction of the scale of the secondary market for computers.

If the TV legislation worked well, states could always choose to move into computer legislation later, after they have worked out the 'kinks'.

Billion Dollar Solution

How to solve the bank insolvency crisis in two easy steps.

Step One, define the problem. The USA buys stuff from overseas. Countries like China, Japan, and Saudi Arabia get a lot of dollars. They have to do something with them. They send some back as cash to buy electronic scrap, but mostly they bought US Savings Bonds. When they heard about the USA deficits, they tried to diversify where they put the dollars, somewhere else safe... and started to buy big bank bonds which were supported by home mortgages. The banks from these countries didn't issue home mortgages themselves. They just bought rolled up mortgages from USA banks.

The USA banks add a margin, and make billions. Every mortgage was an earner, and they did not actually own any insolvent loans for more than a few weeks or months. So they really had no incentive to turn an applicant down. In fact, they issued a lot of credit cards based on Personal Financial Statements relying on the home as the key asset.

Home prices kept going up and everyone was happy. I financed Good Point Recycling on a second mortgage during the first year.

When the USA trade deficit and federal deficits kept growing, it made the China/Japan/Saudi financial experts nervous. But if they started selling their dollars on the open market, the USA dollar would collapse, and they'd lose even more money. If they stopped selling to the USA, they really had not many better alternatives and would probably go into a financial crisis themselves.

1) So the problem can be defined as "the jig is up".

2) Solution:

One solution is bailout with $700M. After all, if the banks collapse, that wipes out individual savings accounts and IRAs and mutual funds. I'm not into that. But it's normal to require some guarantees.

My solution is borrowed from my uncle Eddie Fisher of Hollister Missouri. He told me the whole Federal Reserve debt would be solved overnight if the US Mint made a single three trillion dollar coin and handed it to the Fed Reserve Chairman. It wouldn't be inflationary because, well, there aren't many thing you can buy with a trillion dollar coin, and not many people will make change for it.

What I like about the trillion dollar coin for the bank bailout is that the banks have already demonstrated they are really good at maintaining an asset on the books which is not backed by anything.

Evolution and Intelligence

Watching the History Channel this evening, looking at the evolution of teeth.

Molars, incisors, canines.

It is hard to believe that everyone died (naturally deselected) who did not have just the right teeth.

But intelligent selection (the mates attraction) could have been attracted to the right teeth before the "wrong teeth" became extinct.

It always bugged me how evolution makes complete sense, but that the absence of in-between species made little sense. Sure, the giraffe grew a long neck because the short neck giraffes couldn't reach... and the short neck giraffes starved...?

But antelopes with short necks lived?

But if you introduce intelligence, and I think other species have it, then you get a mate-influenced species evolution.

Intelligent design proponents could, perhaps, reason that God gave divine inspiration to the mates, and that is the combination necessary for intelligent design and evolution... Why would God leave creation to unpredictable evolution? The same as he/she leaves other wrong choices for us to make, I guess.

This could be an interesting way to leave "intelligent design" advocates a place in the science class. If God speaks to creatures and influences their choice in mates, that would be intelligent design (if the creatures listen). At least I haven't read it before. If a higher power influences the female's intelligent choice, then he/she is influencing evolution.

I've always believed God has an infinite timetable, and that time is relative. Earth history may be a split second on another relative timetable. Rocks may appear fluids on God's timetable. Our entire history of evolution may have taken place in a few seconds of God Time (or seven days).

It makes what we do seem less important in a way, but what we are preserving is our ability to make righteous choices. Preserving the planet for future children is a pretty good directive. If my mate finds that directive attractive, and my children inherit it... Whoops, time to go to work.

Bad Neighborhood: Guiyu

Several of my posts this year have defended small businesspeople in Asia, South America, and Africa, entrepreneurs who import used goods for repair and reuse, or who recycle things in respectable ways.

But to give BAN and Greenpeace their due, the best of intentions have potential for problems. The world is improving at a faster pace than it was before BAN raised money with pictures of children on scrap piles. Sure, even mothers milk can go sour, but that is a waste in more than one sense of the word, and as good as recycling is, we should be about wasting less and doing better. The current export debate is like a debate on distributing clean needles to addicts, or legalized prostitution, our differences are on the best way to reform ugly practices... If there were no "unfair" practices, the concept of "Fair Trade" of used electronics would make no sense. If we do too good a job defending clean needles, we can miss the fundamentals. Neither the Taliban or Mao tolerated clean needles, and their countries produced and consumed less heroin after a few well-timed beheadings.

If I am going to be a "crane amongst the chickens" (a Chinese expression for the white bird with the longest neck when the farmer comes with his axe), it better be a far, far better thing I do than I have ever done. The Dickensian parallels between the tales of Middlebury and Guiyu could fill a novel.

When I visited China for the first time in late 2002, I visited sites like the ones in this Toxic Villages video (just found it on "Current.com") , where I was repelled by the smell of burning wire, but focused on how much ingenuity went into the reuse (most of the economics), and was horrified by government efforts to arrest people for 'gray market' refurbishment. Since I also visited the "Big Secret Factories" which do fantastic jobs of recycling good monitors, I kind of saw these villages as a byproduct of legitimate recycling. And as a former Peace Corps teacher, I just liked the story of Chinese repairpeople becoming billionaires (two of the wealthiest Chinese are a former tractor refurbisher and bicycle repairman).

However, I also got an uneasy feeling... Even if MY container is mostly good stuff, how do I follow it through a place like this? Even if I saw wire stripped by hand, I could smell burned wire from somewhere over the fence. It was like ordering a 'virgin bloody mary' in a titty bar. If my wife came in I'd have an alibi but it would not look good. This led us to clean our loads up to go directly to factories, bypassing these middleman operations.

Chinese businesspeople I know have tried to scale up clean operations, some of which look cleaner than my operation in Vermont. It seems easier to make China factories clean than to make USA factories inexpensive and reuse-oriented.

But the problem, as seen in the video, is getting your stuff mixed up with a dirty economy. We send no CRTs to China at all any more, because the chain of custody is too blurry, even if the shipments to Malaysia are much more expensive. And we don't send CPUs or printed circuit boards there, which could wind up boiled in a nasty, polluting, aqua regia process.

We do sell plastic and metal scrap, including keyboards and laser printers, on the open market, and I know from end-market follow-up that those go to China. I am trying to get those to factories I have photos of, but the economics of lower standards may cause me to give up on those after completing the current purchase order. We shipped the material to ElectroniCycle for years, and to Colt in 2007, but keyboards and printers don't shred well.

Here's a fair description (from Tarzan, a yahoo blog which also has a link to the Current.com video). He refers to municipal electronics recycling in China, but the same dynamic exists for commercial scale copper wire.

Efforts to recycle e-waste safely in China have struggled. Few people bring in waste, because the illegal operators pay more.

"We're not even breaking even," said Gao Jian, marketing director of New World Solid Waste in the northeastern city of Qingdao. "These guys pay more because they don't need expensive equipment, but their methods are really dangerous."

The city of Shanghai opened a dedicated e-waste handling center last year, but most residents and companies prefer the "guerrilla" junkers who ride through neighborhoods on flatbed tricycles ringing bells to attract customers, said Yu Jinbiao of the Shanghai Electronic Products Repair Service Association, a government-backed industry federation.

"Those guerrillas are convenient and offer a good price," Yu said, "so there is a big market for them."

On a commercial scale, if you send a containerload of wire to be dealt with at a fine factory, it's difficult not to imagine the broker in Hong Kong diverting it somewhere else, either for profit or because a customs official is having a bad day. The Jiangxi copper smelter is the most modern in the entire world. But the odds of my copper wire winding its way through the streets of Guiyu and coming out at the smelter are pretty low.

Here are some step-by-step instructions for the 'slippery slope' of Chinese scrap exports, based on personal experience:

The good factory I originally dealt with, and still deal with I think, refurbishes floppy disk drives (A: drives) and power supplies and ink cartridges in commercial quanties. A year ago, I got 35 cents each for the floppy drives, no Apple, no bent metal, etc., and they were picked up here by single palletloads for consolidation at the USA office. Power supplies needed to be ATX or ATX2, and we got 65 cents each. We scrapped the rest.

But that buyer found they could get these cheaper if they buy them from a Hong Kong scrap dealer, and started telling us they'd rather buy ALL the FDDs at 15 cents per pound, a huge savings. We still separated the good ones, and still sold the load a pallet or two at a time. Any while it still went through a 'bad neighborhood', we still showed pictures of the factory in Guangxi, even if the Guangxi factory is getting most of its FDDs and PS from a demanufacturer in China. The Good truth just got a little Ugly.

So we wound up shipping our demanufactured parts to or through a Chinese demanufacturing competitor. We take the PCs apart in Middlebury, but send the power supplies and Floppy Disk Drives on a container that now may follow on a trek through a village that is also dismantling a competitor's PCs. And USA export-based competitors can really blur the story, saying they send to the same end market we do.

The Chinese guy says they want more materials. Baled plastic. Baled Steel. So far, so good (if a bit ugly). Why not ship direct?

They ask for laser printers. Hmm. Well, they don't shred well. But we didn't send them, until our USA processor rejected them. Anyway, what's to worry about in a printer? Why bale printers if there are factories that take the cartridges and refurb them? The question became whether to bale them first. The buyer sent photos of a factory, which I verified was in Shenzhen, which resold printer parts and plastic, and the factory preferred they not be baled or shredded. So we started putting those printers on the sea container with the metal and plastic bales...

Now they really, really want copper wire. It's better than mining, right? And the photos I took of the women stripping the copper into huge rooms of bright and shiny metal, I liked those women. Well, I better still send the copper wire to our domestic recycler. But if there's a spot to fill on the container, with the power supplies and Floppy drives... tempting... Then the Chinese buyer hints he's getting it from the domestic recycler anyway. Is he bluffing?

And more and more of our clients are cutting the copper wire off, and throwing the VCRs and printers into scrap metal containers. Many insist they are doing us a favor if we take them for free. Truck fuel hits $5/gallon. A major Earth Day one-day recycling event has only paid half of the bill, the rest looking doubtful after 120 days payable. Staff are due a pay raise....

Ok, as a compromise, we don't believe there is a reuse market for VCRs, so we will sell them but will shred or bale them. But if you are out of baling wire...

The importer wants printed circuit boards and hard drives? ... BAD! NO! CRTs? Out of the question. But if one of our laser printers is caught on film in the same warehouse as someone else's CRTs, boards and hard drives, will people believe those are not our hard drives box right next to it?

And how do I keep our staff believing we are different than a mobster with 1/3 my payroll who puts everything, everything, straight on the boat? How does the mobster believe we are different? And a reputable, all domestic, Pledge Signing shredding company? How can he allow himself to feel the careful exporter is different from the mobster? Printer shredding... does the plastic and metal and little pieced of circuit board go to a different location in China?

Does the location for the shredded material hire happier, safer people than the ones interviewed in the Current.com video?

An independent analyst would probably say that the course most USA electronics recyclers choose to invest in has more to do with market demand and scale of operation than anything else. If we are going to operate in the green mountains of Vermont, we have to run an ecological shop (clients are not rich, but eco-proud). But we also have to collect old TVs to maintain volume, and if 50% of your material is TVs, a shredder doesn't help you much.

Facility space is cheap enough, and pay is low enough, we can take more time on a load than a company in Northern California. And I have Middlebury College grads and lots of travel interest, so I want to find the truth about where stuff goes.

And we would not have even made the trip or come to these conclusions without the attention BAN.org brought to the village of Guiyu in this current.com video. You know, the lady being interviewed in Guiyu, she's smiling. She doesn't take herself too seriously by any means, and she's got a pretty lousy job sorting out printer parts or stripping wire. The way the video ends with health research on the village is actually the best effort to move the story forward... the lead in blood levels are falling. Is that going to be info the mobster 100% exporter misuses to undercharge me? Or will the Shredding Investor tsk-tsk the data and imply it is deceptive.

The Lady or the Shredder...?

Oh what a tangled worldwide web we weave... if first we practice, then deceive. In fact, when two identical monitors have different ethical destinations (one can be repaired, the other screen burned), you have to describe a pretty tangled web. And the people who tell you a simple story, that both monitors are repaired, or both monitors should be shredded, isn't that more deceptive than the tangled up story?

You can see the temptation to just shred everything, or the temptation to just export everything. An untangled web in view can look pretty tangled at the other end, where people are stuck with either an unrepairable unit or little pieces of non-intact units that they have to quality sort. Recyclers don't intend to deceive, but we put the best possible light on the path we have chosen, and perhaps deceives nevertheless.

Truth is light, faith is gravity.

Fair Trade, Micro-Lending, & Digital Development

Good Point Recycling is a socially and environmentally responsible company bringing employment and revenue to Middlebury from out of country sales.

GPR repairs and resells affordable computer equipment to needy areas, offers extensive consumer recycling services in the Northeast, and sets the high environmental standards expected of Vermont companies.

The internet and access to translation in the Middlebury College area created 'Fair Trade' and 'green' opportunities in the global economy. Government officials rely on us as consultants in regulating e-scrap exports, as demand for technology is inelastic and many suppliers are unsophisticated.

Our Purchase Orders are akin to micro-lending, raising global standards. Rather than squeeze ever last penny from the export market, we offer discounts to overseas companies which raise their standards and allow transparent access to their practices. We document high recycling rates, and do not export 'toxics along for the ride'.

Our success brings:

- Affordable recycling
- Blue collar jobs (highest placement levels at local counseling services)
- International fair trade and micro-lending
- Reduced mining and forestry
- International development
- College grads work with with local trailer park residents, Africans, Latinos, and Asians.

"Something attempted, something done, has earned a night's repose"
- The Village Blacksmith (Longfellow)

This is Peace Corps 4.0

Computers and Press Releases are blunt instruments

(photos from MAILonline, cited under fair use policy)

That is basically the story at the UK MailOnline

"...The boy had grovelled in the dirt for mercy, whimpering as blood dripped from his cracked skull. With the computer monitor that had been broken over his head lying on the ground nearby, filthy children with glassy-eyed stares and twisted smirks had stood over him."


Just how bad is donating a used computer to Africa? According to the Mail, you have blood on your hands. Your monitor is being used as a club to beat small children.

What shocks me is that the photos appear to be a ratio of about 20 good computers to one thing being burned on the ground for copper. The author is so over the top, it provides the best explanation for what Jim at BAN calls my "apologist" attitude for exporting. The kids at the landfill look sad, but I don't actually see many PCs there.

Ok, just to warm up for the E-Scrap 2008 conference, here's some push-back...

BAN and SVTC are promoting companies which have zero reuse policy, which destroy everything. They mean well. But by doing so, BAN and SVTC create a vacuum for our competitors to mix bad material into. We have met the enemy, and he is us. If they stand behind an article like this, they are hurting the people they claim to champion.

Another quote from the article

"Most of the hard drives were empty, but one contained medical records relating to patients based in Leeds. It came from a computer marked Northumbria Healthcare Trust, although the data found did not relate to its patients but to customers of a pharmacy that had used the computer after the trust had disposed of it."

Let me get this straight... the hospital the author is attacking... it wiped all of its hard drives. But one was re-used by a third party. So the author attacks the hospital...

Threatening to hurt and embarrass people who have sent wiped, working computers, is a bully tactic. As a former Peace Corps volunteer, as a man who housed African refugees, homeless people, impoverished women from a Mexican coop, international students, young Egyptian computer repairers, Peruvian small businesspeople, and others in my own home this year, I am so frustrated I could cry.

Companies with "no export" policies, and laws like California SB20 which REQUIRE destruction (obsolescence in hindsight) of working monitors, are morally wrong. While the Pledge is careful not to ban all reuse exports, the easiest way to join the Pledge is to end reuse, and that is what many "True Stewardship" companies have done. Put in a big shredder, and you are golden, even if it leaves a pile of toxic fluff (printers and CRTs do NOT shred well, people).

To quietly accept export of "tested working units" (even though that could include a 1988 286), does not go far enough. BAN needs to speak out against California's perverted SB20 "cancellation" rule.

The "tested working" rule is not even in the Basel Convention, which explicitly states in Annex 9 that exports of used CRTs for repair and reuse is completely legal. Critics of digital divide programs state that "someday the monitor will go bad", but that was true of MY first computer when I bought it in 1992 (and there was no CRT recycling infrastructure), and it is true of a brand new computer any African student might buy.

Many people in our industry say they agree with me, but that I am sticking my neck out. BAN has officially refused my company offer to sign the Pledge, over our interpretation of Annex IX, (and officially endorsed a company which exports more than twice the monitors I do). Well, this isn't really a promoted blog, it is intended only for people who understand the nuances of the export issue. So in the words of Huckleberry Finn (when he abandons his guilt over not turning Jim in as a "runaway nigger"), "All right, then, I'll go to hell". It's my favorite line in all of literature...

Companies like mine are not "wishful thinkers". We fly to see our partners, we ask for reports of our mistakes (if we are sending something they couldn't use, we need to know in order to correct it), we fly buyers here to pre-inspect our loads. We have had a lot of fun, made a lot of friends, and changed a lot of practices along the way.

Did you know a tested working Dell 17HS Trinitron monitor is 'waste' at the factory in Jakarta, and the non-working Dell E773 is good? I didn't until I visited the buyer of my tested working monitors in 2004. In Peru, the Dell 17HS Trin is fine, by the way.

We must not let the perfect become the enemy of the good. BAN should not take its toys and go home over the reuse repair "loophole". The only way the situation will get better is if companies like mine succeed in establishing a recycling infrastructure in the countries which REFUSE to stay barefoot and pregnant. If California breaks every monitor, they will buy the monitors from a mobster who sends them junk TVs mixed into the load. The war on drugs approach has had 6 years, and let's admit it now does more harm than good. Companies in WR3A are actively engaging wonderful people in Egypt, Senegal, Malaysia, Peru, Mexico, Singapore, Indonesia, and China, and doing the same kind of work that micro-lending organizations are doing.

If African doctors cannot get affordable working computers, children will die.

Slashdot is cool


This post got hacked. I deleted it 4/11/2011 It was bizarre. Now I need to read other older posts to see if they have gotten hacked as well.

Good Point Ideas Blog: More about SKD (reusing monitors as TVs) Market

Good Point Ideas Blog: More about SKD (reusing monitors as TVs) Market

This was a good paper on the reuse market for used computer monitors.

This is a difficult business to be in. There is no financial incentive to 'clean up' the load before shipping to an SKD factory (semi knock down, see wikipedia), so the free market allows a lot of crap to get sent overseas to these markets. The good stuff flies away, off to store shelves to live on as a useful product, the bad stuff accumulates. Someone who only visits the country once every few years might see the accumulation of 10%, 20%, 30% crap on the ground (depending on how hard the used goods supplier is working to remove bad stuff) and think it represents 80% of the exports to that country. They don't see the good stuff, it's not on the ground.

But like a bullethole, you know there was a bullet. You know because the economics of shipping junk across the world and dropping loads of 80% junk on the ground could not pay the freight.

More and more USA companies are giving into the temptation to buy shredders to just grind all the computers up, recovering the metals.

http://www.youtube.com/watch?v=EehKqoHVBQ4

It's being sold as "best practices". Sure, we will leave Africa barefoot and pregnant (they cannot afford new computers), we will tell the Pacific Rim to mine more lead from the Papua New Guinea rain forests to make new CRTs, we'll charge USA generators extra fees to grind up good stuff.

Then we will call ourselves "true recyclers" and give ourselves awards.

Look at the pile on the ground at the end of the video.

"No export of whole units" is a bad policy. It won't stop demand in lesser developed countries for working used equipment (NAICS 92). It divides the market into pure exporters and pure shredders.

And now they are trying to legislate it. As a former Peace Corps volunteer, I am alarmed. I don't like junk on the ground in Africa, and we export fewer than 1% of the TVs we take in, making it almost not worth it. We have stopped exporting anything lower than Pentium 4. It would be tempting to replace staff who wipe the hard drives and remove unrepairable equipment, replace them with a big shredding machine.

That's what recyclers do who don't like having employees. Creating jobs is a bitch. Let's tell the Egyptians to go buy new stuff and pass a law to keep a Vermont company from sorting the good from the bad. Let's call them names and imply they are bad people. And leave piles of lead dust all over the ground.

I guess I see myself almost being driven to defend the bad exporters. I almost think the pendulum has wobbled so far to the left that "Planned Obsolescence" or Obsolescence in Hindsight is going to win at all costs.

Of course I know the bad exporters are the ones who left the big bulletholes all over this market, which discredited exporting and reuse. Who cause really fine people (like many at BAN.org and Greenpeace.org) to react and promote policies out of sheer frustration.

BAN knows perfectly well that the Basel Convention Annex IX explicitly and succinctly allows exports of electronics for refurbishment and repair. EXPLICITLY states this!!!!~!! But they are so frustrated by the piles of messes, the accumulated scrap that was not good, that they see it as a loophole.

One told me he hopes the poor will "leapfrog" the USA and get newer and better computers than we got. Hey fellow Peace Corps volunteers, hear that? (No bread on the shelves? LET THEM EAT CAKE.)

I think the only hope is to set up proper recycling overseas for the leftovers. Trying to police the exports to limit "Toxics Along for the Ride" may be too difficult, and our Fair Trade model is woefully underfunded and undersupported. What Africa and Asia are going to do is LEAPFROG the USA's woeful repair and recycling practices. They are going to do with smart people what the shredders can never do - separate out a 1 gig stick of RAM worth $10 from a 32meg stick of RAM worth metal.

Pete Seeger, we need a new "John Henry" song for the repair and reuse people, running ahead of the shredding machine. "John Henry was a RAM sorting Man"... But John Henry will probably be named Essam or Hamdy or Souley or Antonio.

A compliment

I got a couple of compliments about some of the blogs I've written.

I wish I had more time. Right now, I am busy raising $1.5M to drastically expand Good Point Recycling businesses in Arizona, Mexico and Vermont.

This summer, we have added textile baling, added fluorescent lamp collection, gone to 100% demanufacturing of PCs, cardboard baling, stretch plastic collections, etc. We have enlarged our job training program, and are trying to rent office space in our new building.

When my family returns to Vermont in three weeks, I will have to readjust from this year of surfing my idle time and mania to exponentially expand the business. It will succeed, rather than fall apart, to the degree we recruit and keep quality people.

Recycling Today / WR3A Chicago Tradeshow June 22-24

Chicago is the place for Electronics Recyclers to be on June 22-24 this year.

http://www.electronicsrecyclingconference.com/


This show is outstanding because of its co-location with a long established office wastepaper and paper shredding show. All those office paper companies have immediate access to thousands of used computers from their paper shredding clients, and they don't like to play games or take chances with their bread-and-butter (document security business), so they are natural allies of "best practices" companies like WR3A.org members.

A top-shelf Plastics Tradeshow is also at the same venue. Municipal, college, and commercial recycling coordinators have a rare opportunity to get business training in several commodities at one convenient location.

WR3A members can get a special discount at the web registration. Our new membership fees are $75 for a general member (interested in contributing, access to conferences, referrals, supporting fair trade practices) and $375 for "vetted" members (eligible to buy and sell either through WR3A or directly to WR3A members with WR3A offer of 3rd party verification).

Last year we had presentations (in Orlando) by EPA, NAID, ISRI, BAN, SWIX, Florida DEP, and representatives of several nations (Senegal, Egypt, Malaysia, Mexico, China) on hand to answer questions. Also we had great presentations from top shelf USA recycling companies. This year's show is no exception, see the the speakers list at http://www.electronicsrecyclingconference.com/default.asp?ConferencePageId=400

We look forward to seeing all our friends in Chicago, where WR3A will also hold its annual meeting. Thanks for recycling!

E-Waste Problem Solved?

In 2008 I am going to work on a blank piece of paper. It would be pompous to say that this solves the "EWaste" problem, but I initially labelled this a solution hoping to attract more attention to the suggestion.

The fees for e-scrap will be on the activity which causes the obsolescence, not the manufacturer of the product which became obsolete. I hope this provokes some others to investigate ideas like the following:

1) Earmark the bandwidth auction

This week the federal government got $19.6 billion dollars from the auction of TV bandwidth to cell phone companies. This was the bandwidth used for 'rabbit ear' TVs, many of which will now need a 'converter box' that will convert crisp HDTV broadcast into old analog pictures (like a 'converter box' which converts color TV into black and white images). Most expect some fallout, even if technically the old TVs can still be made to work. A portion of the $19.6B should be earmarked for recycling.

2) Fee on Operating System sales (Vista, Linux and AppleOS)

This week Microsoft also announced the demise of Windows XP, it will no longer be sold or supported with updates after 2008. That means anything lower than Pentium 900Mhz is headed for the junk pile. MS made more than $4.2B from Vista sales in the 4th quarter alone of 2007. If government collected an environmental fee from every sale of the Vista OS, it would give government a stake in fighting piracy. Microsoft should not only accept an environmental fee, they should actively be promoting it (note to self: be careful how the Linux language is written).

Fees on the bandwidth auction and OS sales would involve relatively few entities handling relatively large transactions. It would address the cause, rather than the effect, of obsolescence.

3) New Mining Land Lease and Royalty fees

Third idea, the General Mining Act of 1872 is FINALLY being revised (at least, it passed the House of Representatives, Heid of Nevada may hold it back in the Senate). The federal lands for 135 years were leased for $5/acre for metal mining, with no royalties for the metals paid for cleanup. It's worse than agriculture subsidies. The new royalties should earmark something for recycling, to clean up the waste lead, copper, etc. from a throwaway society made possible by the old subsidy. In fact, there is today a $900M cleanup fund to mop up old mining sites, that money should be used to avoid new mines by recycling old electronics.

I am getting lots of blank stares. But I am hoping with help to find a legislator willing to look at this seriously.

More about SKD (reusing monitors as TVs) Market

Big Secret Factories!!

WR3A posted a film on YouTube last summer where we showed a hardworking African entrepreneur doing a great job of fixing and reselling monitors in Senegal. His storyline was that he was happily doing business in California... then SB20 came along and ate up all his monitors with a loud crunching noise. He relocated to NYC, and bought from a guy and found I guess the container stuffed with muddy Katrina cake computers, losing all his money. SB20's unintended consequences. When he came to Vermont, he was so worried about taking junk that he tested everything. When it got to Senegal, he repaired everything he could. Yet this guy is being labelled either a polluter, or at best someone bringing working computers "which will someday need to be recycled". What I saw in Souley was the best hope Africa has. To refuse to sell him computers is to keep Africans 'barefoot and pregnant'.

But the African guys scale of operation is only a thousand or so monitors per month. If you really want to understand the export market, look for "Big Secret Factories".

(shhhhhhhhhhhhhhhhhhhh! Colin Davis!)
In 1992, when I was a new recycling program director at Massachusetts DEP, I made a shocking announcement. There were 22 paper mills in Massachusetts that relied on waste paper for most or all of their feedstock, and if people didn't recycle these factories would close and a few thousand blue collar jobs would go away.

Having put myself through grad school driving a paper recycling truck, it was, to me, like an announcement that there are laundromats where people wash clothes. But it hit the front page of the Boston Globe, and I got my first earful from a Governor's (Weld) office about unauthorized leaks to the press.

Today, in a weird deja vu, I have been asked a lot of questions about the controversial theory that there are factories which buy 5000 used USA monitors per day, and that most developing countries do not throw away working CRT tubes. I have film of actual sitings of these 'bigfoot' monitor buyers. But people still doubt. If this was really true, why don't they come out and advertise themselves?

That reminds me of another previous Massachusetts job, trucking at Earthworm Recycling in Boston. It was back in the 1980s before Earth Day 1990 (the big rebirth one). We sold sorted office paper through middlemen to mills like the one in Erving MA which turned it into toilet paper. I thought they should tell people that their stuff isn't made from trees, it's made of recycled paper!! I know, that's done by companies like Marcal now... but when I called the mill guy to convince him, it was a blank stare over the phone.

Like trying to convince a restaurant owner to put a sign in the window... "Someone else ate off of our plates before you."

If you are in the business, its seems obvious, and if it doesn't seem obvious to YOU, then you must not be in the business. If you are not in the business, what benefit does the factory manager get from giving you a tour and telling you? Only harm can come. There is a Chinese expression, "do not be a crane among the chickens". It means if you just another white bird, don't stick your neck up and attract the farmer's attention... or you'll be next on the plate.

"Why would someone want to use my product if they knew it was made of used stuff?" the paper mill manager asked incredulously.

The market forces driving computer exports are on the same scale as paper recycling mills in the Northeast. Reuse and refurbishment factories are so ingrained in the business now that 50% of all computer sales are "white box", which frequently means some component - a repainted case, a refurbished power supply, a rebuilt floppy disk drive - is reuse and recycled.
video
In Septemer 2007, Harvard Business Review published an excellent article titled "The Battle for China's 'good enough' Market". In a previous blog, I went on and on about this.. about the repair and reuse market being a gateway to large scale manufacturing, about the secondary market being the only affordable option for most people in the world, about the protectionist intentions against reuse by established manufacturers, and about the tensions between sustainable reuse, counterfeiting, and 'obsolescence in hindsight'. The reason to repost is that I found some good photos and film clips of one of the factories I was talking about.

The point is not that all exports are good. The factory pictured is the size of a small airport, but they can only use about 65% of the monitors we get in. They use 5000 per day. If we shipped all of ours (including the Toxics Along for the Ride), we could be shipping 6750 per day, with 1750 winding up in piles surrounded by barefoot children.

video

The residue would start to add up. Every day, 1750 monitors would be added to the pile, stripped of copper and plastic, and in less than a week there would be more on the ground than the factory purchased in a day. There would be no pile to photograph in the factory... but head to the village. What the National Geographic or CBS Reporter sees is evidence that junk monitors are being dumped on top of barefoot children and set ablaze.

It is true this pollution is a biproduct of the reuse factory. The legal counsel for the owner of several of these factories told me they were not generating the pollution, but that they were "closing one eye" when they bought the good monitors through middlemen. Their solution was to support WR3A, to buy direct the monitors they need, and to invest in proper recycling of the residue. But in the meantime, they have to feed three shifts per day. So the imports to the village continue.

So is the solution to mine rain forests and make CRTs that will last 15 years, generating vast greenhouse gases in the smelting and production, and then grinding and disposing the working 5 year old monitors?

That cure would be worse than the disease. WR3A.org, World Computer Exchange, National Cristina Foundation, and others are following a "Fair Trade" path, seeking to reform the export practices while supporting the factories in these photos.

If you do a true lifecycle analysis, the recycling hierarchy (reduce, reuse, recycle) holds true in this industry. And what I like about it (and go on and on about in last week's blog), is that I saw 20 year old valedictorians with eyes of steel setting up these factories in Malaysia. I am trying to set one up with a women's coop in Mexico. These people are setting up TV and monitor manufacturing factories. Like little Samsung Sony dudes. Or more like Michael Dell, refurbishing IBM in his Texas dorm room. The Senegalese, The Egyptian, The Malaysian, The Taiwanese, The Mexican Women, The Burkinabes... they are not pirates or sleazebags.

They are the best goddam hope I have for peace and prosperity in the world. And the USA is setting up massive factories and laws to break the stuff, and cut them off at the knees. And it is good, green people doing it. I am growing hoarse.

One hope was Hwang, a Chinese government bureaucrate who represents the new product manufacturers, who in China are trying to kill these factories in order to preserve sales of outdated new CRT manufacturing. She was a very good person, in a government job. She arranged tours for me of any reuse village I asked to visit, of the reuse markets in Guangzhou, etc. When I expressed my fears that the Chinese government would try to put out of business the entrepreneurs in these reuse markets, she had a Taoist response... that as much as the government might one day try, it could not possibly control the reuse market.

Two of China's top 20 billionairs are repairmen (one bicycles, the other tractors). With your brain and someone else's discard, you can be an independent manufacturer.

What follows below is some of the best photos and film clips of one WR3A "secret factory" visits. Click twice below (on the green shirt guy)...

video

At this particular factory, they even took the old monitor casings, pelletized the platic in-house, and re-molded them into new monitor casings!! (adding black die).

I call this a "manufacturer take back program". But it's a white box manufacturer take back program. But they aren't really trying to take their own back... so it's a Remanufacturer Take First program.

So, I can also show you places to buy these TVs and monitors, which are the only ones that most India college students, Egyptian medical students, South American engineering students, etc. can buy. They cost a fraction of the cost of a new monitor, in a place where that fraction is a month's income.

Please allow reuse. I guess Maria Antoinette never actually said (when told that the peasants have no bread to eat), "let them eat cake!". But this idea that they should all get new laptops kind of sounds even more hideously clueless.

In the grey market world, these small manufacturers have the odds stacked against them. There are big competitors throwing logs on the tracks, who got the Chinese Communist Party to shut a lot of them down. It's like the "Catch Me if you Can" movie, they set back up in Indonesia, Thailand and Malaysia. These guys are so damn good. I hope they win.

A less Maniac response to Vermont H.106

Over the weekend I drafted a very long and elaborate response to the Vermont legislation, H.106, which was filed this winter. I tried to do everything, to explain the reprecussions on the reuse market, to explain the export business, to address National Geographic. The more I tried to do, the more impossible the blog became to edit.

So I'll leave it there for history, but try to explain more simply what is going on.

1) Scale:

First, whenever society tries to recycle something new, all the start up costs fall due in the first years. The first HDPE plastic collections in Massachusetts in 1992 cost towns over $900 per ton, eventually leading to a "packaging legislation" episode that I'll get into another day. The point is that the legislation never passed, and within 6 years, as an economy of scale was reached, the value of HDPE soared. Now it is just another commodity, and I think MRFs earn over $500 per ton for the stuff.

When we started collecting computers, we charged 21 cents per pound (about $15 per computer), which beat the previous bid of 28 cents. Our price fell to 18 cents within 2 years, as more communities signed up. We added TVs (the cost of recycling the computers had fallen to 12 cents) at the same rate. We currently charge about 12 cents including TVs, and the price of CPUs is can be zero if we can get them in bulk.

Five years later, over 80% of Vermont residents have a permanent site to recycle TVs and computers, open 6 days per week. The number who have to wait for a "one day event" is very small.

So the question is, will the legislation get to the last 20% of Vermonters before the free market does? Or should the $200,000 be put to other environmental problems as this one follows the HDPE curve?

2) Producer Responsibility:

The legislation attempts to fund the program with producer responsibility. It's an attractive idea, that electronics producers should have to pay the cost of recycling. If the fees people paid were more than $5 every 3 years, it might be worth discussing.

But what happens is that the manufacturers negotiate reasonable things that will hurt the consumer and the environment. First, if I'm a manufacturer, I don't want to pay the same $X to recycle the same computer over and over again. I want to make sure it is destroyed. But the resale value of just one in 4 computers or TVs offsets the recycling cost of the others by 75%. If the good one is destroyed, the cost triples (for the lost resale revenue and added weight). Do we think the manufacturers won't pass the costs on to consumers?

The manufacturer gets "Obsolescence in Hindsight" (a redux of Vance Packard's "Planned Obsolescence). They get us to pay to take useful equipment off the market. I toured the Maine program recycler, he had good PCs but had to make a quick judgement whether to try to resell them as commodities or get his money from the manufacturer. That's what happens in California, too. Millions of working TVs and computers get crushed up, taking them off the market. I'm not saying it's evil... Sony is offering to take back its products nationwide for free, and that's a fantastic choice to have. I just question why the state should get involved and make us choose Sony over the reuse market.

Last weekend's blog went into a lot of detail about the connections between the emerging "white box" computer market, the billion dollar industry of converting certain (not all) used USA computer monitors into cheap TVs in competition with new CRT makers (one owned by the China Communist Party). Extending the Manufacturer's obligations over used product end-life extends beyond the consumer's property rights. These are the companies which developed the "killer chip" (designed to make used ink cartridges "expire" before they are empty). Look for references to Fuji vs. Jazz Camera if you are skimming the article.

3) Freezing a dynamic market:

As I asked in the long weekend blog, who heard of Michael Dell in 1991? Who heard of Acer ten years ago? Who heard of Lenovo 5 years ago?

The H.106 law will kick manufacturers out of the state's stores if they don't pay their share of recovery. Sounds reasonable. Except that 50% of all computers sold worldwide are by small manufacturers, called the "white box" market. Some of those are very small manufacturers who sell over ebay, while others are actually growing fast enough to be the next Lenovo. Some of these manufactures purchase obsolete trade names, like "Polaroid", and we think it's a big company with a telephone number, but Maine has found that a lot of the products on retail shelves is very tricky to find the origin of.

Back in college, we studied Japan's use of "non-tariff barriers", which were creative little laws that were so difficult for USA producers to keep track of that they didn't even know why Japanese retailers were not selling their product. This fits that description.

What is the cost to the consumer of reducing retail competition by 50%?

4) Distraction from other problems

I see a lot of people spending a lot of time and energy to resolve a problem which looks like the free market is making quick progress on.

Perhaps we should devote our limited green people resources to other problems. Let's get the greenhouse gases under control. Let's reform the General Mining Act of 1872 (reform of this massive subsidy passed the US House and is headed for the Senate). Let's ban the export of liquid mercury as a "commodity". Gorillas and Orangutans are going extinct while we debate whether Sanyo would have designed their cassette player so as not to go obsolete (as if Producer Responsibility will reveal the next CD or MP3 standard).

If we set young people's passions ablaze over something we haven't researched, we are doing what the "No Nuke People Power!" people did for me in 1978. Waste my time and turn me a little bit Republican the more I looked back on the effort. The next generation has less leaded gas fumes in their lungs and is potentially smarter and more practical than my generation. We have a responsibility to keep our powder dry, and truly decide this is an issue we need to spend environmentalists blood and treasure for.

Of late the argument I hear is that recycling must be free. Falling in price by 20% per year is not enough. The legislation will save consumers money. First, does it really save the consumer money, or is the cost being passed on as it is in CA, MN, ME? And when consumers are paying $XX per month for cable TV and $XX per month for broadband internet access, how much time should we spend to save them $5 recycling fee every 3 years?

If I give free garbage disposal one day per week, the garbage will pile up on that day, but it does not mean that the total MSW collected at the end of the year will increase. If I give bottles of water away, and my parking lot is swamped for 5 hours, it does not prove that consumers won't buy bottled water. If we spend a billion dollars to save consumers $250,000, we will have wasted limited environmental capital when every cent counts.

5) Silly assumptions distract from better ideas

EPR is monopolizing the airtime on resource conservation policy.

The philosophical principle behind involving manufacturers is that their production methods will be adjusted when they begin taking back the product. Ok, I use DVDs now. Explain to me the justice and cost effectiveness of sending my old VCR back to Samsung? Samsung would have designed it differently? Won't Samsung just outsource it to another scrap processor? How will this teach them to anticipate new DVD technology?

That's the cycle with MOST obsolete products.

Q: What made cassette tape players Obsolete? A: CDs
Q: What made Pentium 1s Obsolete? A: Windows 98
Q: What made Pentium 2s Obsolete? A: Windows XP

What will make the TVs obsolete? Federal analog bandwidth auctions.

Asking the 1980s cassette player manufacturers to take responsibility for a CD technology that hadn't been invented is just silly. If you want to fund the program, apply the costs to FCC auctions and Microsoft Vista.

Polaroid is gone. The Polaroid brand name was auctioned off and is being licensed to a company in Taiwan. Saying over and over and over again that Polaroid needs to take back the Polaroid TVs, Polaroid monitors, Polaroid digital devices is just silly. There is no Polaroid to take them back to. Smart people need to sit down and read some M.I.T. research papers on assembly and component manufacturing (example) and understand what "manufacturing" is. A factory in Taiwan (where land is very scarce) invests in manufacturing tiny little chips. A factory in China molds the frames, and a factory in Mexico hires people to attach the screws. The more 'moving parts' (RAM, Hard drive, video card, plastic base, CDRom, etc.) the more different "producers" are involved.

Wal-Mart basically controls all the money and has final say-so over who assembles where. OK, that's a provocative oversimplification... but it makes more sense than some of the environmentalist theses I've read. Do we want to involve Wal-Mart? Or will the result be rules that the smaller retailers can't follow?

At least Wal-Mart low low prices redistribute wealth to the USA's poor (and do a lot better job than the federal tax cuts). But EPR policy could hurt the poorest.

6) Hurting the poorest

The weekend blog below tried to explain emphatically that the "exports" problem is that unscrupulous companies are mixing in bad stuff with the good stuff. If the good companies stop exporting the good stuff, the bad companies get to mix in even more bad stuff. VT H.106 wades into end-markets with a really simple idea, the only logical response to which will be for good companies to export less.

Like most of the laws out there, Vermont H-106 draws lines around a tiny little state and sets "rules" for recyclers operating inside that state. Look what that did to Maine. Right now, my company in Vermont is benefitting by more complicated rules in New York. If Vermont matches NY, I'd have to move my operations to NH. I'm not trying to be difficult or argumentative (it comes naturally), I'm just saying let's put RFPs out there which reward the behavior you want, and the free market will meet those standards. Using regulations to modify behavior is expensive compared to concentrating market dollars towards the behaviors you want to encourage. (That was a mouthful... I'll leave it in, just in case someone googles that phrase and I meet a doppelganger)

Conclusion:
Vermont House H-106 has the best of intentions, but arrives 6 years late when we already have 80% of the problem solved. For this reason, the unintended consequences are too great to testify in favor of. Let the manufacturers come up with voluntary takeback programs. But don't tell us all that we can't resell our Chevrolet without a law involving General Motors in the negotiation.

First, let's start with less and then add to the laws over time. For starters, Vermont could just pass a simple waste ban, like the ones on auto batteries, tires, and freon equipment (Massachusetts and New Hampshire already have this). Or ANR could issue a state funded contract, bid it out, and then find out how much it will cost to pay the fees.. then they can see if what the manufacturers are offering is worth the cost. As drafted, Vermont H-106 is a million dollar solution to a thousand dollar problem.

E-Scrap Traffic:

Why Good USA Recyclers Should Increase Exports

Warning: This entry became more a treatise than a blog. I am trying to capture the description of two problems - lack of electronics recycling access, and dumping of electronics on the export market. And I'm trying to address two proposed solutions: state legislation and a ban on export trade. My ability to 'compartmentalize' may become suspect about 3 turns down the road... Oh, what a tangled web we weave. But there is enough good description in here that I will leave it up for awhile and work separately on the Readers Digest version.

Chapter 1

A war is being waged on exports of electronic scrap. The chief target are the loads of toxic junk computers and TVs, thrown on the ground in Africa, or burned for scrap in Asia. There are several heros in that war to right the wrongs of unscrupulous recyclers, who have become the drug dealers and gangsters of the recycling world.

Unfortunately, thousands of shipments of affordable used computers have become collatoral damage in this war. Reputable American recyclers are turning away from digital divide programs, as more and more clients demand proof of downstream due diligence. This month National Geographic Magazine entered the fray, repeating the politically correct line, that 80% of material is exported, and most of the exports are junk.

Solution 1.1: boycott exports

The natural reaction of any red-blooded USA company is to sign a pledge, and refuse to export used computers. The entire state of California, and Maine, seem to be on a mission to crack and destroy a million working computer monitors this year. It's increasingly difficult to trace and perform due diligence of overseas end markets, and clients are relieved if you adapt a no export pledge. With so much attention on the junk exports, we may appear reckless if we sell the the nicer units for reuse, repair, or refurbishment.

As our best actors are taking the best computers off of the table, world demand for computers and internet access is growing.

Well meaning states like California and Maine have dramatically increased domestic processing, but few Americans bother with a used computer. Destroying exportable PCs makes recycling more expensive for consumers, but those costs are well hidden in the chain of a retail fees. The unintended consequence has been a banner year for the "mobsters" in our business. Lowbrow waste collectors now find it less difficult to force along unsorted computers... they hire fewer staff, make no effort to remove the junk TVs and monitors, and save money by not paying domestic destruction costs. As the sleazy guys get cheaper, the expensive guys are more tempted to shut the door on all exports.
Bad Outcome 1.1.1 - Continuing demand is met by worse export product.

Here's the irony - The fewer computers California exports, the more desperate overseas markets become. So poor villages get into the business, essentially outsourcing the sorting the Soprano Recycling company skipped.

Companies which are concerned about their reputations and which pay the tab for proper recycling are actually the best exporters, the ones which will NOT mix in "Toxics Along for the Ride" (TAR). WR3A only allows companies which document significant amounts of broken CRT glass and printed circuit boards (evidence of high diversion of bad components) to access export purchase orders.

In the beginning, those protesting the trade were ignorant of the unintended consequences of abandoning the export market to the worst actors. During the past two years, however, they have continued
to repeat a story that they either know, or should know, is a half truth. They have seen the pictures of legitimate factories, and they have read Annex IX of the Basel Convention itself... which explicitly allows export of monitors for refurbishment and repair, and has a footnote which expressly acknowledges the existence of these factories. But they continue to describe the exports in terms that make consumers squeamish.

BAN expresses concern that the 'fair trade' exports will open a 'loophole'. "Loophole" implies that the appropriate exports are a small percentage of what is being traded. But saying that selling a commodity is a "loophole" for trading waste is throwing the baby out with the bathwater. Clearly, monitors repaired or reused as monitors are not "waste". The convention goes to the effort to specifically label these as non-waste. Any kind of trade could theoretically open a "loophole". Approximately 10% of electronics sold at Wal-Mart are returned by the consumer as non-working... Would a Wal-mart selling new computers in Singapore be a "loophole" for the non-working computers inadvertently sold there?

When the good recyclers do sell the working and repairable units overseas, their costs go down. As their costs go down, more consumers can participate. The more who participate, the more junk is captured, which creates even more jobs at the good recyclers, properly managing more junk domestically. And the more junk we collect, the better the economy of scale to process it.

Of course, most of the CRTs we collect are NOT suitable for export. We ship more than four times the tonnage for domestic recycling that we sell for reuse. We want the cheaters thrown out of the game. I just think there are easier ways to do it than VT H.106. But allowing a modest percentage to be resold can reduce recycling costs dramatically.

Bad Outcome 1.1.2 - less affordable recycling and less participation

If the cost of recycling a computer is $10, then four computers cost $40 to recycle. If just one of the four computers can be sold for $20, then the price of the lot falls first by $10 (the avoided recycling fee) and then is offset by the $20 revenue. Reselling one out of four reduces the cost 75% (from $40 to $10). And a $20 computer may be the only one most people in the world can afford.

Bad Outcome 1.1.2 becomes Problem 2... affordable access.

While I had the luxury of entering electronics recycling from the side of government (as a regulator at Massachusetts DEP) my business philosophy draws more from my stint as a Peace Corps volunteer in Cameroon, Africa. The key is to trade fairly with our overseas partners, not to send them to buy new computers they cannot afford. In the beginning, I thought about helping poor people, like my kids in class, get onto the internet.

Bad Outcome 1.1.3 - less competition from "white box" PC manufacturing companies

Over time I have found that the story is bigger, and better, than classroom computers and internet cafes. The refurbishing market is complex and sophisticated, with entire factories and teams of engineers churning out billions of dollars in product. They are so good, in fact, that original equipment manufacturers (OEMs) created a trade association to fight them.

Vermont should not have a dog in that fight, or if we do, we need to help out the small dog.

Solution 1.2 - Legislation

The widespread criticism of the export market, and the rising cost of recycling at good companies who disqualify themselves from that market, leads to rising cost-to-recycle, which reduces participation, which reduces demand, which reduces access. A lot of states have very few places to recycle at all. To address both the export problem and the lack of affordable access, activists propose a legislative remedy. It's a bit of a dilemma to solve affordability at the same time as reducing buyers of the commodity. The more you reduce 1, the harder it is to promote 2. So a guy in California name Ted Smith (one of two or three in the industry whose ego compares aggressively to my own... which is understandable, since he was recognized by the Dalai Lama, citation needed), says something like "the manufacturers should be responsible to solve this problem, it's too complicated for us." A whole movement was born (or piggy backed on), labelled "Product Stewardship". This attracts more courageous souls like Ted and I.

There are several different ways the legislation has been proposed, and I can't do justice to them today. So I'll use Vermont's new legislation as an example. One premise that Vermont H.106 has right is that our business should be more regulated. That's exactly what WR3A is trying to do. Unfortunately, the VT bill tries to do so the way Minnesota and Maine have, with an elaborate command-and-control regime which bans Vermonters from purchasing 50% of the computers made in the world today. Those who drafted the legislation had a simple idea in their minds, and when the world didn't fit their model, they wrote off 50% of the computers made today, and probably 85% of the computer companies.

But does Vermont have Problem #2? And if not, is that because we have addressed Problem 1 in a "Fair Trade" manner. Right now, 83% of Vermonters already have access to permanent collection sites at rates more affordable than California, Maine, and Minnesota. We got where we are with yankee ingenuity, salvaging working parts for reuse and resale... and selling them primarily to the small factories which will likely be excluded from the Vermont market. As more Vermont communities added programs, we hired more people, creating more jobs, and the cost of recycling has fallen. We are already on track to have 100% recycling access, without the new tax regime or market interference that the bill forebodes.

Bad Outcome 1.1.4 - Big companies are initially reactive to being legislated, then they begin to realize (1.1.3) that it can be a non-trade barrier for entry into their markets.

The major manufacturers and retailers are friendly spirits. I like everyone I know at Sony, Sharp, Panasonic, Dell, HP, IBM, etc. I haven't looked closely at my retirement stock portfolio in awhile, but I wouldn't mind owning some HP and LG Philipps stock. But these were already interested parties in the marketplace, and drawing them into legislation makes them moreso.

A 2007 Harvard Business Review article tangentially but convincingly explains their interest by looking at their marketing strategies in China, where so many of the refurbished and white box manufacturers are growing. Vance Packard, who coined the phrase "planned obsolescence" understood the nature of the market. Controlling who is allowed to sell electronics in Vermont serves the same anti-competitive purpose.

The law would make it harder for our end markets, the folks overseas who need clean and working PCs... Some of them are even becoming big enough to sell their refurbished equipment back in the USA. And that may be the point of some industry support for the bill.

Environmentalists are trying to do something I applaud, to make it harder for sleazeballs to export the stuff everyone knows doesn't work, or like VCRs and Apple IIs, would be worthless if they did, and needs to be recycled. My company wants a level playing field more than anyone, and if Tony Soprano will be truly regulated (unlike the freon recovery industry, which has zero enforcement), that's great. But this bill reaches for the ceiling, trying to incorporate corporations in Taiwan, Japan, Germany in Vermont's infrastructure. It writes off the markets it doesn't understand, says that if they don't fit, they can't sell their product in Vermont.

The state needs to start with "problem definition". Despite simple and affordable programs and competition across the state, some individuals and even townships refuse to participate. Massachusetts and New Hampshire ban disposal of computers and TVs... those laws are simple and effective. Massachusetts goes further by having a statewide contract which enforces best management practices with civil law.

If creating access to electronics recycling is not the problem, or at least is a problem that could be taken care of without involving producers and retailers (via a NH or MA style waste ban for example), what is the best way to curb the other problem - the export of junk? By exporting more, not less. The good companies need to step up and out-compete da Sopranos, by providing quality, inspected, computers at a cheaper cost.

If the legislation is too cumbersome, how can the problems be better addressed? First, as stated in an earlier blog, civil law is easier to enforce than international law. The offices and districts which buy recycling services need to state what they expect to happen to their bad CRTs and hard drive information. Bulk state contracts in MA dictate stricter terms of recycling. More insurance is good, end market audits are good. My company is trying to do that through the WR3A, or World Reuse, Repair and Recycling Association (http://www.wr3a.org/). WR3A members are trying to replicate the success of Fair Trade Coffee, an alternative to the "boycott Folgers" idea that circulated in the 1980s, before more rational people pointed out the result of a boycott... Juan Valdez and his mule would be really screwed.


Here is an internet cafe my partners in Mexico opened last year with PCs recycled at Retroworks de Mexico.

This is getting long, but I'm going to continue after a cup of coffee, in order to try to cite more external sources, especially periodicals which tell a more complete story. Two do an especially good job, the Harvard Business Review of September 2007, and the NIH Perspectives article published in 2006. The perfect world envisioned by Vermont's new legislation is a case when the perfect is the enemy of the good.

~~~~~~~~~~~~~~~~~~~~~~~~~

Harvard Business Review published a very good article in September by Orit Gadiesh, Philip Leung, Till Vestring titled "The Battle for China's 'Good Enough' Market" It explains how a few billion people in China and India and Indonesia and Malaysia are getting to where they can have a home, and start to want a TV or a computer. They may not be rich, but they can afford a cheap product. They are not the same as an American consumer.

The article explains how major corporations like Sony and Panasonic have traditionally concentrated on the most expensive, most profitable, market segment. I've heard the expression "the 80/20 rule" and have applied it to a lot of things, in this context 80% of the profit margin are in 20% of the TVs being sold. If you are selling a $2000 TV to an American, they probably can afford the TV, and you can afford to support it, and you can make a lot more money selling $2000 TVs to the 20% of people who want and can afford those than selling to the next 40-50% of the market. So the big corps leave the sales of under $200 TVs to companies who are selling a product 'good enough' for emerging consumers.

The article goes into the danger of leaving the less profitable market segment. The companies that do come in and sell to that segment wind up getting very big, creating more of an economy of scale, ie larger purchases of raw materials, more employees, and more potential to take on the more profitable segment later.

"White box" computers, according to Gartner (a market research company) now make up 50% of computers sold worldwide. What I know from my trips overseas is that while people tend to think of white box sellers as local guys who assemble PCs from 'barebones' cases (PCs sold without the video cards, RAM, hard drives, and other components that the tech can use to selectively build the PC). But a large number of the so-called "white box" PCs are actually much larger scale operations, factories even, which are using used floppy drives, used CRTs, used ATX computer chassis, etc., and adding faster motherboards, larger hard drives, etc. In fact, the photo is from a trip WR3A made to a very large factory which purchases 5000 USA computer monitors per day, strips them down to the CRT, and completely rebuilds them into digital TVs which can pick up TV signals in any country - PAL, PAL2, SECAM, NTSC1, NTSC2, etc.

For those of you who don't know, the entire TV broadcast industry was specialized country-by-country in the first place in order to protect domestic TV manufacturing. If Germany had its very own broadcast signal, it was harder for USA, or France, or Japan, to scale up a factory which made TVs that worked in Germany (the same standards wars go on today, with beta v. VHS, and different DVD settings).


In the past decade, a Taiwanese firm created a circuit board which 'hacks' any signal, allowing the TVs to work in any country (some think this pushed HDTV in the USA). They started Monitor factories, 14 of them, but found they could grow even faster by selling the circuit board in mass 'kits' to factories like the one in these photos. Those factories that buy the kits now have a choice. They could buy new CRTs from Asahi, Samsung, LG Philips, or TCL the largest CRT manufacturing factory in the world, based in China and owned by the Chinese Comunist Party (CCP). New CRTs are good for 15-25 years (depending on quality and hours of use). They are made of mined lead silica, barium, copper, stainless steel, etc., involving huge furnaces which melt the glass cullet and mold CRTs in an extremely technical process that produces a cathode ray tube costing $50-$150.

OR.. they can buy a 5 year old used USA monitor for $5 and reuse the CRT, which will be good for 10-20 years. That TV can be sold at half the cost for twice the profit. And it is "good enough" for most people in China, India, Africa, etc. Good enough for me, in fact... I used second hand CRTs while waiting for the price of LCDs to drop.

I bought a new LCD monitor last year. It was a "Polaroid" which cracks me up, Polaroid is a brand name licensed out to an assembler in the same Taiwanese market. The Waltham Massachusetts camera factory has NOT reopened and is NOT making LCDs. Incidentally, that new LCD lasted one year. I bought a second one that also stopped working. I don't know if I am hoaxed or if there is going to be a big LCD 'disposables' market... of course if I lived in Egypt or Malaysia or China I would have had the two LCD screens fixed, but as an American I saw that the DPI and monitor screen size had gone up, so I bought a new one. I'm in that 20% rich person market, you see.

So anyway, the point of the Harvard Business Review article is that little companies can grow to be big competitors by selling things that are not good enough for rich people to less rich people. This market is, in dollars, the primary end market for used electronics, refurbishment and resale. Ask Michael Dell, who began his business retrofitting IBM PCs in Texas. Ask biographers of Lee Byung-Chull (founder of Samsung) who began as a trading company refubishing electronics discarded from Japan. Ask two of the wealthiest billionaires in China, one a former bicycle repairman, and the other a former farm tractor repairman.

Who of us had heard of Lenovo five years ago? Would they even have been mailed the application for the Minnesota law, or VT H.160? If they received it in the mail at their office in China, would they have read it or known what to do with it? Or would they wind up not selling Lenovo computers in VT? I'm writing this blog on one of their laptops.

One suspects that may be the whole point. This lesson has not been lost on some well heeled companies. The free market dynamic desribed is the point of the "Anti Gray Market Alliance", and the point of putting little holographic 'killer chips' on the inkjet cartridges, and the point of the US Supreme Court case of Fuji vs. Jazz camera, and the ban on used shoes importation into Nigeria following the opening of a Nike factory. Refurbishment is a gateway to becoming a big company.

The PIRG advocates I spoke to admitted they didn't understand this "white box" market that sells 50% of the PCs in the world. But I think it seemed acceptable to them for us to have a choice of Sony, Panasonic, Dell, HP, etc. If we don't know these little companies that won't be selling their wares in VT, what's the cost?

Who ever heard of Michael Dell in 1991? Whoever heard of Acer ten years ago?

Creating a barrier for "white box" computer manufacturers to sell in Vermont is being represented as a necessity to create an infrastructure for recycling. But the infrastructure is growing on its own. 80% of Vermonters live within a few miles of a permanent collection site for used TVs and computers, open 6 days per week. Before VPIRG "solves" this problem, they need to explain what the problem is. Is it the 20% of Vermonters? Well, eight years ago 0% of Vermonters could affordably recycle their TV or computer... the legislation seems like a last minute effort to "rescue us" on the way to success.

Moreover, get this... the white box market worldwide is the biggest buyer of working used electronics collected in VT!! People think the little Mexico internet cafe I have pictured is typical, but just one of the white box recyclers buys 5000 monitors per day. Here is a video of a company very similar to ones we have visited in China, Malaysia, and Indonesia.


video
I think I may have confused my PIRG friends when I explained that the white box manufacturers that we needed to protect included a lot of overseas importers of used electronics. After all, the most frequently cited reason for interfering in the free market is the export business. I sometimes refer to them as "manufacturer takeback programs", which the PIRGs are calling for after all. And they are. Why should we care that they take back other brands? If Dell offered to take back HPs, would that be a problem?

Until you understand that entire factories run on legitimate escrap imports, you cannot rationally explain the export of escrap halfway around the world. Did the barefoot chinese children form a coop and gather $3000 to ship 35000 lbs of junk, just to dump it?


Now in their defense, BAN.org and Greenpeace visit these villages, and see nothing but crap. Peter Essick of National Geographic saw the same thing. Of course it's nothing but crap! The good stuff isn't getting thrown in a rice paddy, it's being resold at the Foshan Market! It's like going to a cemetary and expecting to find live people. The ones on the ground were the TAR, the junk, the ones they couldn't sell!

And speaking of Foshan Market they got whacked last summer. The Chinese communist party came in with their heavy boots and cleaned out all the resellers. You see, the CCP owns new manufacturing, and just arresting people is easier than doing it the way Fuji tried to stop Jazz Camera (a one-use camera recycler that repairs and resells discarded Fujis), ie paying lawyers to take them all the way to the Supreme Court (and lose).

I could get into the "war on drugs" analogy here... when you ban trade in something in strong demand, people go underground for it, and it becomes less feasible to regulate the trade. What I tried to do this year is tell the story in a video, available on youtube (search WR3A), of an African trader who had reliable suppliers of working monitors in California until California SB20 "drank the anti-export koolaid" and specifically mandated that processors "compromise the vacuum seal in the CRT monitors upon redemption".



  • Result 1: California processing costs jump to 48 cents per pound (since you have to ruin the good monitors).

  • Result 2: Souley moves his computer reuse business to New York.

  • Result 3: Souley buys his first load from "Tony Soprano" and opens a container of CRAP in Senegal.

  • Result 4: BAN photographs junk on the ground in Africa, and says that people like Souley are international criminals, and the trade in used computers is illegal.

During my two years as a Peace Corps Volunteer in Cameroon, Africa, I fell in love. I fell in love with my class. I had the best, smartest kids in my 9th and 10th grade class. God, I loved those kids. Crying love. I really strongly debated whether I should stay in Africa, but renewing my post as a teacher in Peace Corps didn't really seem like the way to bring sustainable change there.

A lot has been written about how to help Africa, and I remember the idea of going to work for Oxfam occured to me. I kind of liked the story of buying a poor African a cow instead of buying him food. But agriculture was not the best hope for my kids. Working for the African government is more likely for a well educated African, which is the biggest tragedy, it is so corrupt I felt certain that it would chew my kids up and ruin them as adults. It was almost tempting to see MultiNational Corporations investing in factories as a solution, something I wrote a paper against in high school. But the number of my kids who would really gain pride working for a European, USA, or Asian factory was not appealing to me.

What appealed to me was my Cameroonian roomate's brother, Aaron Cho Kum of the Bamenda area. He had found that a part that wears out of coffee bean hullers, replaced from a company in France, was costing a month's wages (over $40) for most coffee farmers. He figured out a way to replace that part with scrap aluminum. He did so well he later bought new aluminum sheets and made a little factory. He had a TV, a lot of happy kids, a proud wife, and a great sense of humor (the best things about living in Africa is laughing and crying there.. I got so much more of both than I had ever tasted in the USA).

Aaron Achou Kum and the shade-tree mechanics who fixed mopeds (how often do you see 30 year old mopeds being maintained in the USA?) were the best hope for my kids. People creating their own entrepreneural jobs.

Those were the people arrested in Foshan Market in Guangdong, darn it.

Yes, let's stop the exporting of junk!! Yes, let's clean up the rivers in Guangdong!! But we won't do that by increasing the percentage of virgin lead ore at the Guangdong smelters!!!! THAT IS MORE POLLUTION!! China should be recycling MORE, not LESS. If i buy a car battery made in China, I want it to be 100% recycled content for God's sake, not 50% recycled and 50% newly mined lead!!

At times BAN saves me from losing a client to Soprano. But BAN is also exporting a form of madness, that the pollution in the Chinese rivers comes from recycling. The pollution comes from virgin material production. Recycling reduces pollution! To see how bad the virgin smelters are, type in "lead zinc smelter" and "pollution" or "spill" into a news search engine. Here's the first one in the Herald Tribune, likely a source UPSTREAM of the BAN recycling villages BAN visited.

So they get good companies to stop exporting good products, opening the market for the bad companies. Then there is less recycled material, and so China mines more and has more smelters like the one above. Metal smelting in the USA is the source of 45% of all toxics released by all US industry... and we want China to make our products that way instead of using recycled content?

And the press is drinking the kool-aid.

A few reporters have really tried to get to the bottom of the story. Charles Schmidt published an article, Unfair Trade e-Waste in Africa, which tried to cover both sides of the story in 2006 Environmental Health Perspectives.

But more typical is the John Stossel / ABC headline "Waste Dumped Abroad Is Rarely Recyclable or Reusable"

I had a long conversation with Stossel's staffer who interviewed WR3A for the story. I showed her pictures in this article, told her about the fight for the little guys trying to build businesses overseas who don't want, don't ask for, try to avoid the junk... but that banning exports forces them to buy junkier loads from less reputable suppliers. She said she really wanted to tell this story, but that she had a hunch Stossel wanted an "easier" story.

Bill Moyers got it partly right, but largely missed the mark, but that was way back in 2002 when I was saying the same thing, before I had actually travelled overseas to study the reuse market.

Of course, I don't want lead in toys made in China. But it would not console me in the least if the toys were made from virgin lead. When BAN "discovers" recycled content in the lead in the toys, we must all exclaim loudly DUH!!!!

According to the US Geological Survey 84% of all lead in all lead products is from recycled feedstock. That is a good thing. The percentage of recycled metals in metal products has always been high. Thank God!

My little Vermont company pays $3000 per week to properly recycle dud CRTs at an audited, state-contracted, properly inspected facility in Massachusetts. We could save a lot of money mixing the junk in with the good stuff as "Toxics Along for the Ride". So we kind of support BAN and Greenpeace.

The folks at BAN are good people, they want the world to be better. When I speak of the Digital Divide, however, and the best hope for Africa being internet access, so Africa can export its laugher and tears, and import the truth... Jim said that his vision was for the poor people to "leapfrog" the rich people countries. All the Chinese and Africans should get a new computer, I guess. Way to GO!! I'll shut down my Mexico internet Cafe, Souley in the WR3A Youtube video can empty his shop, fire the repair staff, and sell new PCs costing a year's wages.

Of course, the criticism of used working computers, from Silicon Valley Toxics Coalition, is that "they too eventually will not work, which will create a problem in the future for the poor countries"... I guess that is also true of the "Leapfrog" computers. So the solution is to give Africa neither the affordable 3 year old monitor (good for 12 more years) nor the new monitor...
It sounds like Africa should stay "barefoot and pregnant".

A lawyer I respect, John Bullock, gave a presentation at NRC a few years ago which I moderated, speaking along with Sarah Westervelt of BAN and Bob Tonetti of US EPA. Great debate, great participation, one of my favorite sessions, all three gave great insights. Sarah gave the BAN film, the John Stossel story, and exposed a problem which my industry applauded her for... we hate the sleazeballs who undercut our pricing by exporting junk. But John Bullock opened his presentation with an analogy. Walking along a sidewalk in China, he saw a man with a blanket rolled out on the sidewalk, selling western medecine. Hardly a pharmacy. John said he could clearly see the poor gentleman was just going to "make a mess of it", and speculated that someone could get killed. But he posed the question, will fewer people die if we deprive China of medecine?

In the beginning, BAN meant well and created awareness of a problem. At this point, BAN has had enough time to refine the story, and if they are still saying exports are 80% junk and that mining is better than recycling, then this has descended into a basic hoax. The VT legislation is one of the broomsticks of this sorcerer's apprentice, as it sweeps out anyone who sells working products to people who cannot afford new products.

Product Stewardship!! Pass legislation!! Make Ford take back the Fords, Honda take back the Hondas, IBM take back the IBMs, HP take back their toner cartidges.. so the factories in China won't refurbish them and sell them to us in Vermont at half price.

Look, if HP wants to buy my used printers and cartridges and run them through a big fancy shredder like MicroMetalics in California, thats fine. I like having that option, just as I like the option of selling my used Ford to a Ford dealership. But I don't want the state weighing in on that decision. Reselling my Ford to a kid in town may be better.

Some of my friends have said that our one day event in Burlington held last Earth Day, with our partner Small Dog Electronics, proved that people won't pay a toll to recycle. I tried to explain that if Starbucks advertises free coffee on Earth Day, Starbuck's parking lot will be packed and the lines will be long and they will give away a lot of coffee. It would not prove that those people would not otherwise pay for a cup of coffee.

The whole principle of making someone who sells or donates a used product to a poor person somehow liable for the waste could become a huge tax on the poor. Should the state require that I do a "downstream audit" of the kid who bough my Ford? Gee, if used cars are being dumped in the ocean, or burned for scrap in Africa, maybe we need a Product Stewardship law which would stop this terrible free market and make us bring our Fords back to Ford, our Hondas back to Honda, and our HP printer cartidges back to HP.

The used car market is 7 times the economy of the new car market. We cannot let Ford "fix" that problem for us, even if some of the used car sales are problematic. That is the point in the Harvard Business Review article. As the electronics industry emerges, there will be more and more companies competing.

Conclusion... One hope was offered to me by a Chinese woman who was giving me a tour of a reuse market like Foshan's in Guangzhou. When I told her I was afraid for this reuse business, for these people, following a AGMA story about HP paying Chinese enforcers to shut down cartridge refilling businesses (a victory story since 'disappeared' from the AGMA website), she said she did not believe the government could police it. The free market is too big.


The very hope I got from her is the biggest despair of BAN. They confide to me that the demand is too big to regulate. Perhaps if everything sold has an RFID tag...

Obsolescence is often a matter of personal choice, a motorcycle which is too old for me may still get fixed up and resold on ebay. As the wealthy 20% of the world market (which includes 80% of Vermonters) chooses to think their product is obsolete, that doesn't mean the old products are not good enough for poor people.

BAN and Greenpeace and PIRG people are smart and good people, and I continue to try not to attack them, and every day it seems one of their stories saves me from losing a client to Tony Soprano. But if they truly understand the supply and demand equation, they will embrace WR3A's Fair Trade routine, promote our membership, and we in turn will invite them to inspect and participate in the standards. Civil law is a real solution.

The alternative may be the grave danger of becoming the unwitting ally of the AGMA (Anti Gray Market Alliance) When my ecologist friends mistake corporate support of takeback programs as a sign that Original Equipment Manufacturers (OEMs) are "coming around", brought to their knees by BAN and SVTC's stories.

AGMA is primarily a defensive move taken against the growing industry which supplies China, India and Africa's "Good Enough Market".

AGMA (renamed in 2004 to the Alliance for Gray Market and Counterfeit Abatement) got rid of the printer cartridge story, when HP teamed up with the CCP to shut down printer cartridge refurbishing shops in the Chinese city of Nanhai. I was there after the Communist Party EPA closed down all the repair shops, taking cartridge inventory and burning it in the street, and arresting entire families. My recollection is that I wrote an angry note to AGMA or HP, and the press release disappeared. But if you read closely, many old press releases are still available at http://www.agmaglobal.org/press_events/archive/past_news_releases.shtml

But it is truly an Orwellian world, and it will take a professional reporter to dig the AGMA/HP/Chinese Communist Party/ arrested printer repairpeople story out.

John Stossel's "Man Bites Dog" stories are easier to write... selling a working computer in Africa is not a story, it's more exciting to write about the bad one.

Someday, the good hearted people at BAN have to give up on using the press to maintain their status as the "Ayatollas of E-Waste", issuing ecological fatwahs against good companies who try to meet the world demand for working products. I hope I am not alone in raising these issues (it could be dangerous for my business). It would be so much easier for me to sell out, to stay in line, work with government and OEMs to crush up the working computers, draw a check, and act as a tolling facility on the side of the War On Reuse, or what I coined as Obsolescence in Hindsight.

I am doing this for the people of Fronteras, Mexico, who have their first internet cafe. I am doing this for the entrepreneural factories, which don't want to "close one eye" on the villages that screen Tony Soprano's loads. I am doing this for Sambeng, Achou, Sanda Martin, and so many of my other students from CES Ngaoundal class of 1986.

Yes, there are pirates in the grey market. I won't sell used laptop batteries any more, I think they are being resold as working. But the entire reuse market is not a black market, not a counterfeit market. There are white knights in it. Both the black market and the white markets threaten established OEMs like those named in the HBR article.

That's why it's called the grey market.

One of the things happening is that HP, Dell, Gateway and others are following the HBR advice, and selling their own "refurbished" or "good enough" computers via their own websites. I applaud this and want their reuse operations to participate in WR3A. I just don't want to put RFID tags and deposits and product stewardship laws to tell me they are the only market I can sell to.

We have met the enemy, and he is us, said Walt Kelly's character Pogo (one of my favorite comic strips). The legislation in California, Maine, Washington and Minnesota is not making the need for internet access go away in Asia and Africa... legitimate demand for the product is only growing. But we risk seeing fewer and fewer GOOD recyclers participating in meeting the demand, rather than disqualify themselves from the market. Vermont's proposed H.106 means well, and tries to make many improvements, but the risk of unintended consequences makes it too risky to let this become law as written.

Viva ebay.com



More information about AGMA can be found at http://www.agmaglobal.org/.
The Alliance for Gray Market and Counterfeit Abatement is a non-profit organization composed of companies in the technology sector. Incorporated in 2001, AGMA's mission is to mitigate the gray marketing and counterfeiting of technology products around the globe. The organization's goals are to protect the authorized distribution channels and intellectual property of authorized goods to improve customer satisfaction and preserve brand integrity.