Bad Statistics: The Jumping Off Point for E-Waste

Well, since EPA and Basel Secretariat won't defend themselves from the bully in Seattle, it seems to fall on me to defend sanity.   Should poor people be allowed to accept donations from, and do business, with well meaning rich people?   My answer is yes.   HR2284 says no, and makes that opinion law.

Using Halloway (post yesterday) as a jumping off point, let's look at all the assumptions for the case banning trade in used electronics between rich nations and poor.

They keep saying 80-90% of electronics exported are burned in horrific condtions.
" has been widely reported that 90 percent of the USA's e-waste ends up in either China or Nigeria—a figure that appears to originate from an estimate made by Jim Puckett, Director of the Basel Action Network. "
It has been widely reported, indeed.   The figure "appears to originate" from Basel Action Network.  Basel Action Network credits the statistic from a 2002 interview they did with my buddy Mike at DMC.   My buddy Mike says, via this blog, that he was including ALL exports - clean baled steel, demanufactured copper, aluminum, plastic - everything that comes out of electronics.  And he meant exports to Europe (printed circuit boards) as well.

The actual studies with actual data show an imperfect but rational marketplace.  85% of used electronics imported into Africa are working or repaired.  The other statistic is that MOST Africans can only afford a used device - for now.  China has a plan to change that.

African business people can't afford to pay $10 to ship an item worth $3.52 in scrap.   BAN says that a good unit would pay for the transport of the bad units... but that's only if the African Geek is willing to donate his share of the profits to disposing YOUR junk.  Meaning he would have to charge you, or lose his money.  The more rational step is for the African to be very careful about picking and choosing items he can repair and reuse.

- The goods from the USA are mostly good.
- The bads at the dump are mostly generated over there (after decades of reuse).
- The mostly good were mostly purchased at thrift and second hand shops in the USA/EU
- China and other rapidly-ermerging nations are a new source of cheap and "gently used" goods

The question for China and USA is, how do we make money selling into this market?  Do we resell our used cars and electronics for their best value, giving us an incentive to take care of them?  Or do we just withdraw, to keep our consciences shiny and our Goodwills and Salvation Armies beyond the reproach of export markets?  Because THAT's where the Africans (and Haitians, and South Americans) buy from, the used goods marketplaces in USA and Europe.  And the number of "rich" people (used goods owners) doubles each year - and they are cropping up everywhere.

Salvation Army and Goodwill have competition.  Not just from for-profits like Savers and eBay.  The used goods market is growing as the world economy grows.   New consumers are created as wifi and electric cable wrangles its way into the slums, and as slumdogs become middle class, they generate their own used display devices, laptops, and cell phones.  The cup of used goods runneth over.  But the solution is not to ban the poorest from getting the leftovers.

The African who has an education (like my best students in Cameroon) has a limited choice of jobs.  Agriculture, government, and resource-curse multinational corporation employee are at the top of the list.  But the savvy African who finds rich people throwing money away, because they can't and won't fix their TVs, follows a shrewd path which created many Chinese millionaires before him.

To wire a market which has electricity and wifi, but earns $3000 per year, the emerging market entrepreneur goes to mine the "urban ore" in the cities in Europe and USA.  The African traders must either "fly and buy" or have his own associates on the ground to inspect the goods.   

With BAN's phony statistic in mind, Interpol and Halloway deduced that the African and his partners inspecting the good must be "organized" and therefore, "organized crime" (I'm not joking, that's the actual Interpol report reasoning, see blog from last year).

Basel Action Network makes all its money by scaring people into giving the added-value goods to certified e-Stewards.  E-Steward inspection is more expensive than R2 certification, so BAN attacks R2 companies.  In other words, BAN makes its money selling you insurance that they won't attack you for exporting.  Since they have demonstrated time and again that they don't need facts, just a picture of an export container at your dock, and will judge your book by its cover, the safest thing is to shred the added value.  The Planned Obsolescence corporations ears perk up, and they give donations to Goodwill to make them ban the Africans from buying the working computer you donated there.

Not a dime goes to the kids in Africa whose photos BAN exploits - kids breaking down mostly African e-waste collected from African cities and traded in at African used goods stores.  And America loses the residual value of the assets from our heyday, setting "speculative accumulation" rules on antique markets.

This entire racket blows up if the truth comes out, that 80-90% is a completely bogus statistic.  It was completely is made up and speculated to begin with a decade ago, and now "is said thought to originate" itself back into the press despite detailed studies.  Holloway really ticks me off because he correctly sites statistics from one of those studies and then applies the 80-90% horse manure statistic to it and appears to make a contribution... but actually just generates another 2012 publication which someone else will cite in another poorly researched Open University article as a source for the 80-90% e-waste export drama statistic.

There are real Africans, African geeks, being exploited here.  They are being exploited by dictators, by planned obsolescence, and now by idiots in the environmental community.  But there's good news!

Peru sells used China TVs
As I reported from Lima Peru, businesspeople in Africa and South America can get their used TVS and cheap new Chinese TVs, too.   The emerging markets used to have to choose between a containerload of affordable gently used TVs from Europe, or a container of almost cheap new Chinese-made LCDs.

Now they can buy half a container of used CRTs, half new LCDs.  From China. It is a way China now has to reduce its costs of goods sold to Africa - something China cares about.  China has already taken over the new goods market, and they will take over the sale of used goods, as well.

The market in Lima which sold used USA TVs now sells used Chinese CRTs, and new Chinese LCDs.

That's the good news... It's all non-OECD to non-OECD trade... legal under the esteemed Basel Convention.  What we really needed is a law to take Americans out of the picture entirely, and to guarantee economic Apartheid between the fair-trading rich and the idle poor.   China is lending Africa $20B to buy more Chinese goods, new and used.  Read about the conditions on the loans.  China will be able to discount orders from China, i.e. apply a hire rate of loan repayment if Africa purchases Chinese goods.   Basel and WTO will have fun trying to untangle THAT technique of economic jujitsu.  The USA has done the same thing with agriculture and grain sales, which economists blame for poor investment in African agriculture.

Why invest in growing food in Africa if you must then make a higher loan repayment than you would if you buy the food from America?  China has learned to apply that lesson to electronics.

It's about accounting for our accountability.

Chinese loans to Africa are like data and garbage.  Garbage in, garbage out.

No comments: