November 1972 Home   Newsletters

December 1972

January 1973

December Calendar
Letters from the City Charter Commission (Andrew T. F. Ing & Kay Jones)
Charter Wrap Up (or at least a pause) (Dee Lum)
Letters to the Editor (Judy Blatchford & Mable Keesling)
Garbage Bag - Taxes favor virgin materials
How Does Foreign Trade Affect You?
Population Growth Report to be Televised (Gretel McLane)
Foreign Trade Page
State and Local Program 1973-74

Garbage Bag

Taxes favor virgin materials

Capital gains treatment for profits, depreciation schedules, depletion allowances, and other tax write-offs for extractive industries encourage use of virgin material. A staff study for the Joint Economic Committee places the growth budgetary costs of federal tax subsidies for nation resources at 1.45 billion dollars in 1971… The study says, "the subsidies to timber, oil and other minerals appear to provide incentives to use these resources in greater amounts and instead of other alternatives". When the nation was young, exploiting its natural resources seemed necessary and wise, something to be encouraged. Now this policy seems less wise, It puts recyclable material at an economic disadvantage through a federal tax structure that helps keep the price of primary products low. Walter W. Heller, former chairman of the Council of Economic Advisors, put it this way, "To continue stimulating the overexploitation of oil, coal, timber and every mineral from iron to vermiculite and spodumene by big tax subsidies in the form of excessive depletion allowances, capital gains shelter, and special deductions, becomes ever more anomalous. Here is another case where the believers in the market pricing system ought to live by it."

Judy Blatchford attended a joint Environmental Protection Agency-LWV seminar on solid waste in Virginia in October, She reports that it was most instructive in terms of political reality,

  1. EPA is under orders to fund only demonstration projects that have national applicability. This makes it difficult for Hawaii td qualify.

  2. EPA regional officials seem to feel that their national offices policies reflect too much of an East coast-urban orientation which does not always sufficiently take into consideration the realities of other locations,

  3. With regard to new legislation that EPA may propose to congress in 1973, in the field of promoting recycling the path will probably be to recommend tax credits for industries using secondary materials rather than repealing depreciation allowances for industries using virgin Materials, Such a complex structure has been built by these later industries over such a long time that it might cause hardship to many people to try to reorganize it quickly.

  4. EPA policy seems Very strongly oriented toward enforcement. This seems to be useful in states with an ample land supply. League of Women Voters representatives from Hawaii the Virgin Islands and many other places with land problems felt that EPA's hard line emphasis on sanitary land fill was not the most helpful approach for the national agency to take.

  5. A great deal of citizen pressure will be required to move the interstate commerce commission to reverse its position that higher freight rates for scrap iron and steel are not discriminatory. The big steel producers use mostly ore, adding only a little scrap in cooling. Scrap users us 100% scraps. If rates are found to be discriminatory that either scrap rate could come down or ore rates could go up, Big producers are willing to pay a little more for scrap if they can avoid and increase for ore, therefore they pressure the ICC to maintain their findings that ore and scrap do not compete so a raise in rates for one is not discriminatory. What hurts is that the ICC has stated that this increase in scrap rates would have no adverse environmental impact. Abandoned cars litter the land while we import iron ore.


Solid waste is or only growing national resource.


Citizen "recycling centers" do not constitute recycling. They are simply collection centers. Recycling does not take place until the material collected is used, usually in some manufacturing process.

November 1972 Top   Home   Newsletters January 1973