We should recycle more because it costs lots!

We do tend to think that this is not convincing logic:

A plastic recycling industry potentially worth £2bn and 5,000 jobs is dying in the UK because of government failure to close a loophole that allows 600,000 tonnes of plastic waste to be exported each year.

The argument runs as follows. It’s cheaper to send waste plastic abroad than it is to recycle it here. It’s cheaper to make plastics anew than it is to use what is recycled here. Therefore we must ban the export and also insist upon the use of recycled. This will then create 5,000 jobs and £2 billion.

This is all, obviously, to insist that the use of plastics must be £2 billion a year more expensive and those 5,000 people must be dragged away from doing something useful to stare at plastic waste.

As we never tire of pointing out yes, obviously, some recycling is worth it - that which makes a profit. Some recycling is not and that’s the type that makes a loss. Where the resources devoted to doing it are more than the value created by it being done. Yes, we can insist that there are externalities and so on which prices do not fully capture but please show your workings.

When people start shouting about how expensive the recycling is going to be - what they’re doing here with the 5,000 jobs created line - then we know this is the sort of recycling we shouldn’t be doing.

Moving resources from lower to higher valued uses is the very definition of wealth creation. Moving economic assets from higher to lower is the very definition of making us poorer - and why would we want to do that?

Anyone beginning to gain a clue as to why there’s been so little economic growth recently, why productivity is flatlining? Yes, you at the back there, you’re wholly correct. It’s because we keep doing things which subtract, not add, value.

Don’t even dream of trying to recycle everything - just recycle what’s worth recycling and don’t the rest.

Tim Worstall