April 14, 2009
Anti-recyclers like the Cato Institute’s Grant Schaumberg, Katherine Doyle (1991), James DeLong of the Competitive Enterprise Institute (1994), Lynn Scarlett (1995) of the Reason Foundation, Jeff Bailey (1995) of the Wall Street Journal, Alan Caruba (2003-01), Daniel K. Benjamin (2003) of the Property and Environment Research Center (PERC), John Tierney (1996), J. Winston Porter of the Waste Policy Center in Leesburg, Va., Libertarian Michael Mungerar (2007) and La Giorgia (2009-01) argue that “the market” should determine what if anything is recycled. Anti-recycler Tierney claimed that the well-publicized 1000s-of-miles journey of the Mobro 4000, a barge carrying Long Islanders’ trash, trying to unload its cargo, incited a garbage guilt epidemic among Americans. He like other anti-recyclers, also claimed that the garbage crisis that emerged from this image continues today under false pretenses: there is no shortage of environmentally safe landfill sites; curbside recycling rarely pays for itself in direct returns; recycling is not economically efficient. (Tierney 1996-06-30)
Recycling advocates Richard A. Denison and John F. Ruston (1996) of the Environmental Defense Fund in Washington, DC argue that the think tanks quoted by the anti-recyclers such as The Competitive Enterprise Institute, the Cato Institute (both based in Washington DC), the Reason Foundation (based in Santa Monica, CA) and the Waste Policy Center (based in Leesburg, VA) that tend to promote market interests over the state, minimal government intervention in general and government programs of any kind. At least some of these think tanks accept funding from companies involved in “solid waste collection, landfilling and incineration, the manufacturing of products from virgin materials, and the production and sale of packaging and consumer products. Many of the corporations that fund the anti-recyclers have a direct economic stake in maintaining the waste management status quo and in minimizing consumers’ scrutiny of the environmental effects of products and packaging.” (Denison and Ruston 1996-07-18)
1960s A political movement to save the environment emerged called the greening of America
1960s Martin Lapierre’s father founded Profix Environnement, an industrial collector of corrugated cardboard based in Laval, Quebec by collecting used boxes and selling them back to manufacturers for reprocessing. Martin, who inherited the business estimated that the cardboard the firm has recycled over the years has saved at least 750,000 trees (“(La Giorgia 2009-04-09).
1970-04-22 20 million people celebrated the first Earth Day in the United States.
1970-04-22 United Congress created the Environmental Protection Agency (EPA).
1972 the Club of Rome published Limits to Growth arguing that the American way of life was not sustainable.
1980 Property and Environment Research Center (PERC) in Bozeman, Montana was formed by a group of economists claiming dedication to improving environmental quality through markets and property rights through research and outreach education. Research is at the heart of PERC’s work followed by outreach and education. PERC claims to have pioneered the approach known as free market environmentalism (FME).
1987 A barge named the Mobro 4000 wandered thousands of miles trying to unload its cargo of Long Islanders’ trash, and its journey had a strange effect on America.” Anti-recycler Tierney claimed that the garbage crisis that emerged from this image continues today under false pretenses. He also claimed that there is no shortage of environmentally safe landfill sites. (Tierney 1996-06-30)
1987 America devised a national five-year plan for trash. The Environmental Protection Agency promulgated a “Waste Hierarchy” that ranked trash disposal options: recycling at the top, composting and waste-to-energy incinerators in the middle, landfills at the bottom. The E.P.A.’s five-year goal, to recycle 25 percent of municipal trash, was announced in a speech in early 1988 by J. Winston Porter, an assistant administrator of the agency. Even as Porter was setting the goal, he realized that it was presumptuous for a bureaucrat in Washington to tell everyone in America what to do with their trash. “After all the publicity about the barge,” Porter recalls, “I sat down with some engineers in my office to estimate how much municipal waste could be recycled. At that time, about 10 percent was being recycled. We looked at the components of waste, made a few quick calculations and figured that it was reasonable to reach a level of 25 percent within five years. It wasn’t a highly quantified thing. Some of the staff didn’t even want me to mention a figure. But I thought it would be good to set a target, as long as it was strictly voluntary and didn’t involve a lot of regulations.” Politicians across the country had bigger ideas. State and city officials enacted laws mandating recycling and setting arbitrary goals even higher than the E.P.A.’s. Most states set rigid quotas, typically requiring that at least 40 percent of trash be recycled, often even more-50 percent in New York and California, 60 percent in New Jersey, 70 percent in Rhode Island. Industries were pressured to set their own goals. Municipalities followed the Waste Hierarchy by building waste-to-energy incinerators and starting thousands of curbside recycling programs-all in the belief that it would be cheaper than landfilling. But the incinerators turned out to be disastrously expensive, and the recycling programs produced a glut of paper, glass and plastic that no one wanted to buy.” (Tierney 1996-06-30)
1989 J. Winston Porter left the Environmental Protection Agency and became president of a consulting firm, the Waste Policy Center in Leesburg, Va. By 1996 he was advising cities and states to abandon their unrealistic goals of recycling and he “ridiculed EPA policies he had helped implement saying, “People in New York and other places are tilting at recycling windmills. [...] There aren’t many more materials in garbage that are worth recycling.” (Tierney 1996-06-30)
1991-09 anti-recyclers, Grant Schaumberg and Katherine Doyle, “Wasting Resources to Reduce Waste: Recycling in New Jersey,” Washington DC: Cato Institute,
1994-01-26 James DeLong, of the Competitive Enterprise Institute in Washington said, “The solution to the Municipal Solid Waste (MSW) non-crisis is to recognize that trash disposal is a commodity, like coal or asparagus, and to treat it accordingly. The government could establish a few rules to avoid externalities and cost shifting, and then let the free market work. Operating within this framework, waste disposal companies, truckers, railroads, municipal officials, recyclers, waste generators and others could all perform their receptive functions. The result would be a complex amalgam of regional landfills, short- and long-haul transportation by truck and rail, incineration, recycling, and source reduction. In a few years people would wonder what all the shouting was about.”
1995 anti-recycler, Jeff Bailey, “Curbside Recycling Comforts the Soul, But Benefits are Scant,” Wall Street Journal,
1995-01-19 anti-recycler Lynn Scarlett (Reason Foundation) “A Consumer’s Guide to Environmental Myths and Realities,” Dallas, TX: National Center for Policy Analysis,
2002 “The continuing dialogue about recycling is well illustrated by the February 2002 response of the National Recycling Coalition (NRC)—one of many groups formed around this issue—to the white paper put out by the EPA. The NRC finds much to approve of in the EPA recommendations but returns to the fundamental issue of sustainability: can we go on producing and consuming and disposing of material goods at an ever-increasing rate?”
2003-09 Daniel K. Benjamin published the report entitled Recycling Rubbish: Eight Great Myths about Waste Disposal with Property and Environment Research Center.
2009-04-09 “From last year’s peak, prices [for recyclable material] have dropped 50 to 90 per cent,” said Mairi Welman of the Recycling Council of British Columbia (RCBC), a group of government and industry members with a stake in recycling ( “(La Giorgia 2009-04-09).
2009-01 Profix Environnement, an industrial collector of corrugated cardboard based in Laval, Quebec was struggling to survive as the price of cardboard dropped to zero (“(La Giorgia 2009-04-09).
2009 Quebec promised $4.8 million in loan guarantees to support its recycling industry, as well as legislation allowing recycling companies and municipalities to renegotiate contracts (“(La Giorgia 2009-04-09).
Webliography and Bibliography
DeLong, James V. 1994-01-26. “Wasting Away; Mismanaging Municipal Solid Waste.” Competitive Enterprise Institute Monograph.
Denison, Richard A.; Ruston, John F. 1996-07-18. “Anti-Recycling Myths Commentary on ‘Recycling is Garbage‘”.
La Giorgia, Giancarlo. 2009-04-09. “No cents in recycling as economy kills demand for material.” CBC News.
Munger, Michael. 2007-07-02. “Think Globally, Act Irrationally: Recycling.” July 2, 2007. Library of Economics and Liberty. Accessed 2009-04-13.
Tierney, John. 1996-06-30. “Recycling is Garbage.” New York Times Magazine.
Benjamin, Daniel K. 2003-09. Recycling Rubbish: Eight Great Myths about Waste Disposal PERC Reports: 21:3.
Caruba, Alan. 2003-01. “The Utter Waste of Recycling.”
January 2, 2009
The credit crisis erased $14 trillion (McKeef 2008-12-31) from world stock markets in 2008. Where does $14 trillion in world stock markets go? How can that much capital disappear from the market? The infamous year 2008 will be known in the future as the year that fundamental concepts in the moral mathematics of the market were forever changed. This credit crisis was the worst since the Great Depression of the 1930s but its ramifications may be even deeper.
How can we visualize a billion dollars? How much more difficult is it to imagine a trillion dollars?
The most recent wiki entry (2009-01-01) describes how any attempt to visualize numbers higher than a million is complicated because there are too systems of numeric names and the difference between the two scales grows as numbers get larger. Million is the same in both scales, but the long-scale billion is a thousand times larger than the short-scale billion, the long-scale trillion is a million times larger than the short-scale trillion. The short scale system is used in the US and a long scale system is used in the UK. The short scale system of numeric names means every new term greater than million is 1,000 times the previous term: “billion” means “a thousand millions” (109), “trillion” means “a thousand billions” (1012), and so on. Long scale refers to a system of numeric names in which every new term greater than million is 1,000,000 times the previous term: “billion” means “a million millions” (1012), “trillion” means “a million billions” (1018). (wiki).”
6 zeros = 1 million, a thousand thousands or (106)1, 000, 000
8 zeros = a hundred million (108) 100, 000, 000 this image
9 zeros = 1 billion in the short scale system used in the US = a thousand millions or (109) or 1,000,000,000
12 zeros = 1 trillion in the short scale system used in the US = “a thousand billions (1012) or 1,000,000,000,000
12 zeros = 1 billion in the long scale system used in the UK: 1,000,000,000,000
18 zeros = 1 trillion in the long scale system used in the UK is a million billions (1018) or 1,000,000,000,000,000,00
1,000,000 6 zeros = 1 million, a thousand thousands or (106)1, 000, 000
“World stock markets ended on an uptick for the year on Wednesday, after some bourses registered their worst annual losses in history. Global stocks as measured by the MSCI world index ended up 0.76 percent for the day and posted their first monthly gain in seven months, but lost 43.36 percent for the year. About $14 trillion (9.6 trillion pounds) in market capitalisation was erased from world stock markets in 2008 in the wake of the worst credit crisis since the Great Depression of the 1930s. “It has been a shocking year, hardly anything was spared in the carnage,” said Michael Heffernan, strategist at Austock Group in Australia. U.S. stocks edged up on Wednesday and saw their first monthly gain in five months, but the year has been the worst for Wall Street stocks since the Great Depression (McKeef 2008-12-31).”
Is this another complex financial instrument that will help the wealthiest investors pay fewer taxes while making charities believe they actually have received more funds? Imagine the worthless stocks from oil company cash flows when the exploration comes up empty. Imagine Calgarians contributing these stocks to their favourite charity.
“The resource mining industry in Canada has been given special treatment under Canadian tax law to make it easier for the industry to raise capital — by issuing flow-through shares to investors. If you invest in flow-through shares, the company enters into an agreement with you to incur Canadian exploration expenses (CEE) or Canadian development expenses (CDE) in an amount equal to the cash you paid for the shares. The company also agrees to renounce and flow through to you the expenses incurred, so the CEE and CDE expenses are deemed to be your expenses, not the company’s. The result? You’re able to claim a deduction for the full amount of the money invested, with most of the deduction (often about 90 per cent) falling in the year you make the investment, and the balance being deductible in the second and third year. For tax purposes, your flow-through shares will generally have an adjusted cost base of zero. By now, you may be aware that the federal budget of May 2 changed the tax law to eliminate the capital gain on any publicly traded shares that you donate to a registered charity (excluding private foundations) after May 1, 2006. Because flow-through shares typically have a zero adjusted cost base (ACB), there will generally be a capital gain when you sell them. You can avoid tax on that gain, and help a charity at the same time, if you donate the shares. Check out the math; it’s quite amazing: Suppose you invest $10,000 in flow-through shares. You’ll save approximately $4,600 in taxes from the $10,000 deduction you’ll be entitled to (assuming a marginal tax rate of 46 per cent). If you donate those shares to charity after two or three years, when the development is completed, and we assume the shares are still worth $10,000, you’ll pay no tax on the capital gain (the gain results from your ACB being zero). You’ll also be entitled to a donation tax credit for the $10,000 value of the shares, which will save approximately $4,600 in tax. So, you paid $10,000 for the shares, got $4,600 back in tax savings from the deduction, and $4,600 from the donation tax credit, leaving a net out-of-pocket cost of just $800. That is, a $10,000 donation to charity cost you just $800. That’s what I call charitable arbitrage (Cestnick 2006-07-08).”
“It is important for charities to ensure that the receipts issued in respect of flow-through shares received are accurate. First, charities have the duty to exercise due diligence when issuing charitable donation receipts to ensure that the information on the receipts is accurate. Failure to issue receipts reflecting the accurate eligible amounts may lead to charities being exposed to intermediate sanctions that were proposed by the 2004 federal budget and implemented in 200516 for issuing incomplete receipts17 or false receipts,18 or may even lead to the revocation of their charitable status. In this regard, subsection 248 (41) provides that if a donor fails to provide the charity with relevant information19 that may cause the eligible amount of the gift to be less than the fair market value of the property gifted, then the eligible amount of the gift would be deemed to be nil. Second, a charity must be careful in ensuring that the eligible amount of a receipt reflects the accurate true value of the donation received in order not to negatively impact the ability of the charity to meet its disbursement quota. The amount for which the receipt is issued is included in the charity’s disbursement quota requirement for the following year. If a charity issued a receipt for an inflated amount and later sold the property for an amount far below the amount for which the receipt was issued, the charity may have a shortfall in meeting its disbursement quota. Failure to meet the disbursement quota is grounds for the revocation of a charity’s registered status.20 (Carters Professional Corporation 2007-06-12).”
Theresa L.M. Man; Karen J. Cooper; Terrance S. Carter. 2007-06-12. “Donation Tax Shelters Involving Flow-Through Shares”. Charity Law Bulletin. No. 116. June 12, 2007.
Cestnick, Tim. 2006-07-08. “Flow-through Mining Shares Can Produce Charitable Bonanza.” Globe and Mail.