The Clinton Administration and Recycled Paper

All over the country, controversies are raging over what to do with solid waste trash. The three alternatives are (1) dump it in landfills; (2) incinerate it; and (3) recycle it. A growing movement behind recycling is registering gains with more and more local and state governments.

Paper makes up 40% of the what is called the solid waste stream in this country. An effective way to induce the paper and pulp companies to invest in paper mills that can recycle paper using significant postconsumer (the paper we use and throw out) content is to have the federal government — a big buyer of paper -­require such content in its purchasing specifications. The Clinton Administration proceeded to do just that earlier this summer. It proposed an executive order requiring federal agencies to buy paper with recycled fiber, starting with 15% postconsumer content and going up later in the decade. The Clinton folks saw nothing unusual about their proposal, because several countries in Europe (Germany, Sweden, Finland) and Japan were buying printing and writing papers with 25% or more.

A federal procurement standard has great influence with other larger buyers of paper, can accelerate enabling investment by the industry, and can speed up the use of such paper, save lots of trees and other costs.

The paper and pulp industry got its hands on the proposal and unleashed a massive lobbying effort to water down the proposal to 10% recycled content which recycling specialists, local and state government officials and some people in the White House described

as “why bother?”

Industry lobbyists hired the Wexler Group — a lobbying firm with extensive Democratic contacts in the Clinton Administration. They reached the usual minions of the industry, including the powerful Senate majority leader, George Mitchell from Maine, to send letters of protest to White House aides. High level meetings between paper company executives and the Clintonites were held at the White House in August.

When I met with some of these aides a few days ago, it was clear that the paper industry’s power had gotten to them. Although a 15% starting purchasing standard was entirely feasible from existing capacity, and although two companies at least were willing to dispute privately the united paper industry’s stand, it looks like the White House is going to crumble and accept the 10% level.

Ten percent post consumer content is just the industry’s bargaining position. Why take it?

Environmental groups, led by the Environmental Defense Fund’s precise, technical advocacy, the U.S. Conference of Mayors, the National League of Cities, the National Association of Counties and the National Institute of Governmental Purchasing all favor a 20 to 25% standard. Some are willing to start at a compromise figure of 15%. But the paper industry seems to be winning.

Note, please, that a government purchasing standard is not a regulation. It is not coercive. A paper company doesn’t have to sell to the U.S. government, nor does the government have to buy from that paper company. What a purchasing standard can do is stimulate competition, investment and innovation, just as the government purchase of 5500 air bag equipped cars from Ford in 1985 did in the auto industry.

Yet the White House is treating this procurement standard with the political anxiety usually reserved for a tough regulatory proposal.

The Environmental Defense Fund (EDF) has demonstrated that the federal government should not have to pay more for recycled paper, that market forces already are reducing the small price premiums for such paper, and that the indirect environmental savings are impressive.

Once the government’s consumer demand registers, says EDF, low-cost manufacturers will produce these papers on their state of the art machines, and then incorporating post-consumer fiber will actually lower paper manufacturing costs, as Union Camp and International Paper are planning to do with new plants to open in 1995.

The paper and pulp companies, as was pointed out in a page one Wall St. Journal story in the Seventies, have a tradition of behaving collusively. Their trade association has organized a united front on this recycled paper issue that smacks of “product fixing” which could be an antitrust law violation. We have asked the Justice Department’s antitrust division to investigate recent meetings of paper companies in this regard.

In the meantime, Clinton has not yet signed off on the watered down version yet. The White House telephone number is 202­456-1414 in case you wish to register your opinion with staffer, Thomas McLarty.

For more detailed information on this subject, write the Environmental Defense Fund for a free copy of their position on postconsumer content paper at 1875 Connecticut Avenue, NW, Washington, DC 20009.