Reader Response to Brenda's Fair Trade WR3A paper

"Mike" writes:

I just read Brenda's paper on Fair Trade and, although a little dry, came away with a better understanding of what you guys do and in particular what the issues are in your industry.  Whether due to lack of comprehension or something else, I still don't understand the 'recycle stream' as opposed to the 'reuse stream'.  Is it preferable to do all the recycling (back to base materials) in the US?  Is there a legitimate recycling business that meets fair trade expectations and is also international?  Does RDM do recycling and/or reuse?

And an unrelated question from a news article on recycling...who are the 'lobbyists' who have been able to keep the US from joining Basel?

Thanks for the comments, Mike.

The central issue is the devaluation or of goods from commodity to scrap commodity to waste to hazardous waste.  The definition the courts use to distinguish between "commodity" (aka property) and "waste" is whether it is "discarded".   Natural depreciation in value is the free market's way of redistributing wealth, but in the form of waste, it has such diminishing returns that society accepts regulation.

Clearly, you don't want rich countries discarding drums of useless and toxic waste materials on west African beaches (the issue the Basel Convention was formed around).  But the "mission creep" of the Basel Convention into commodity scrap (based on residue or on lead solder) continues into actual repair and reuse or "value added" commodities.  The lobbying I'm familiar with on this issue is when a manufacturer practices "obsolescence in hindsight" by making the secondary market more difficult, forcing more purchases from the primary market, and Basel Convention is definitely a tool OEMs can use in fighting "market cannabalization" or sales lost to used and repaired goods.

I'm not familiar with lobbying by USA industry against Basel Convention ratification, per your second question.   Generally, the USA is loathe to sign international treaties which have gray areas, most often interpreted to the advantage of the interpreter, and often with "underdog vs. USA" outcomes (did you see the call by the ref from Mali nullifying the USA World Cup goal?).  The USA does not want USA soldiers tried for war crimes by Iranian courts, and does not want "waste vs. commodities" to be defined by Chinese courts.  The "dumping" in the free trade sense is already being negotiated at WTO, and the USA does not want Basel Convention to become in effect a "second front" in the commerce and protectionism wars.

My own philosophy is that the flow of wealth and value from rich to poor nations is represented in trade of value added products and commodity scrap, and selling or donating a used computer to someone who wants it is no more criminal than giving stale bread to a starving child.  In the 1980s, scrap dealiers in the Philippines were buying waste paper from USA offices and removing staples and sorting the paper by color, something USA paper recyclers couldn't afford to do.  Eventually USA paper mills put in better screens for the laser inks, but in the meantime "waste export" was debated as a reason not to export the scrap cellulose to SE Asia (also a concern that the Philippines scrap paper labor was reading the private information on the office paper, which I think was baloney).  At that precise time, which was before the Mobro Barge and the "landfill crisis" in the USA, environmentalists like myself were primarily concerned that paper industry was investing in massive tracks of land in Indonesia to turn the rain forests in by to pulpwood farms, and I argued that the worst recycling was better than the best deforestation.

In the case of RDM, there are several legal rules to follow for the maquila dora, for the commerce laws, for EPA, and for SEMARNAT.   A different administrator in each office makes a separate determination of  "waste" and "commodity".   We are on strong legal footing, but there is "spaghetti code" in the regulations because the USA defers to a "competent authority" quote/unquote in the foreign country, in effect putting us in violation of USA law if the competent authority, so-called, defines something as a "waste".   We believe we are in compliance an any case, as nothing is being discarded in Mexico at all, and we have stopped short of breaking or processing CRT glass (we will re-transport it north to be processed and re-import the cullet back south to the smelter.    Comically, the decision to repair or reuse something (currently as simple as plugging it in and gee, it works) is an economic decision - is it worth repairing?  And therefore, the joke concludes, I would have repaired it rather than recycle it if I had known you were going to call recycling "disposal".  This has been the joke about "speculative accumulation", if you say it is a waste because I haven't repaired the TV in 365 days, then I guess I can afford to hire a repairman based on the fines I will avoid by repairing it.  We believe that our transparency, and the fact we do NOT dispose of anything on Mexican soil, keep RDM compliant in every possible interpretation of USA and Mexican law, and we are just still waiting for the permit to break the CRT glass into cullet for the smelter.

The issues of commodity vs. waste keep getting bandied about in the political realm, and what I like about Brenda's paper is that it represents the type of apolitical and non-commercial analysis of the issues, juxtaposed against the "propaganda war" going on in the discussions over "ewaste" or "escrap" export.   The Chinese official's statement at the Interpol meeting, that China can define any product once owned by someone and now sold to a second person as "discarded" by the first and, therefore, "waste" under Basel, is an example of the legal can of worms we open if we don't expose the debate to honest study.  

I don't like the image of people eating out of garbage cans, or for that matter photos of lines of people at soup kitchens, but closing soup kitchens is no solution to hunger.  I believe that secondary market is the free market's natural response to redistribution of wealth, and if we close the secondary market or shred everything, the poor will turn to government- or worse - to redistribute wealth.


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