Tuesday, February 9, 2016

Recycling Economics

Occurring on the Amador Politics Facebook page is a discussion prompted by the closing of some local recycling facilities. Part of the reason for this is the lower prices paid for recycled materials due to our current economic downturn. The exposure of and cleansing from the economy of economically unsound enterprises is what is supposed to happen in this phase of the business cycle. But some participates in that discussion find the solution to be more government involvement to shift the uneconomic burden to the retailer or the manufacturer, which not surprisingly will just raise prices and cost us ordinary folks more money.

However, reusing materials is just common sense and these are my thoughts on improving the situation. Manual sorting needs to be replaced with a technological improvement in sorting. It could significantly lower costs and also the more skilled machine operators would make higher wages that the present manual sorters. At one time there was not a process to sort ferrous and non-ferrous scrap metals, but someone invented it. He became very wealthy and the whole world benefited. Perhaps this is a problem that green committed Apple or Google could tackle.

One of the reasons many recyclable materials have low values is the transportation cost. Before digital cameras film canisters from the Bay Area were shipped to LA for recycling. This was a money losing proposition but won on public relations. However, public relations doesn’t build a sound economy. But many Bay Area residents didn’t want recycling plants nearby. There was a frightening explosion at one and while I don’t know the specifics, accidents in low margin industries with less skilled labor are certainly more likely to happen there than elsewhere.

Local reuse works such as the fly ash from the Buena Vista Biomass Plant being used for cattle beds, but local opportunities are slim. And while localism is gaining adherents across the political spectrum and may work with produce and some other products the counter veiling trend will prevail. The more sophisticated the technology a greater initial investment is required along with a larger and more efficient scale of production. Cutting fabric by hand held scissors was replaced by a band saw style cutter. This could cut only ten bolts at a time since the bottom fabric would bind and be a little shorter. Anyone who bought two pairs of jeans the same size and found one pair a bit smaller may remember that problem.  But that was solved, and costs reduced, with laser beams cutting 100 bolts at a time.

Before the large leap in the technologically defined scale of production overwhelmed transportation costs it was more efficient to produce near the point of consumption. The former auto assembly plants in the Bay Area and Southern California were built during that time.  I find it futile to fight history and equally futile to support subsidies that are not even tax revenue but money borrowed from hostile foreign powers with unknown consequences.  So along with mechanized sorting I suggest localized (probably Stockton in our case) preliminary processing of recycled materials. This is similar to gold bearing rock being turned into dore close to the mine and then shipped to final refining. Is it now possible for one truck load of material to replace ten former truckloads of material to large scale regional facility? Is this sufficient to solve the transportation cost problem?

As with prior ideas I have written about, the above are suggestions, not detailed proposals as I am not a mechanical engineer or otherwise qualified.  But what I am certain of is that innovation solves problems.

That is what once made America great and can make America great again.

Copyright 2016, Mark L. Bennett

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