Should we ban food dumping?

Source: one20farm.blogspot.ca

Source: one20farm.blogspot.ca

In the United States, about 40% of food goes to waste, and only 5% of food waste is composted, the rest is dumped in landfills. What really boggles the mind isn’t just imagining all these rotting piles of food in the landfill. It’s that all those people are spending so much time farming, transporting, and processing all of that food. And then a whole bunch of other people are spending their time collecting just under half of that food, and dragging it to trash pits.

Never mind the massive soil degradation that the United States is seeing, as well as the continuing destruction of natural habitats through pesticide use, resource depletion, water over-use, and so on.

Apparently Massachusetts has decided to ban the landfilling of non-residential food waste. They are, in effect, making food dumping illegal. Via the Boston Business Journal:

About 25 percent of Massachusetts’ solid waste is organic trash that consumes valuable and dwindling landfill capacity and, as it breaks down, contributes to greenhouse gas emissions. Most of that waste can be put to better uses — whether by feeding people, ensuring a reliable feedstock for operators of anaerobic digestion units, or providing opportunities, including for Massachusetts farmers, to operate commercial compost facilities.

In a recent piece, Darden Copeland argues that, in fact, this is all wrong. Consider, he argues, the massive financial costs of redirecting food waste:

From a financial perspective, sending waste to a landfill is far and away the cheapest method of disposal, and the new regulations will force tons of waste to be sent to places like anaerobic digestion facilities at a much higher cost. Businesses will have to sort and separate their waste at the source, store it separately and have it picked up by a separate vehicle—all of which will increase their costs and, ultimately, their customers’ costs.

In the end, he says, it’s the consumers who pay. This analysis is quite right, if you only understand “payment” in terms of direct monetary costs, i.e., the price tag of food. But one could just as easily re-write this paragraph with a different angle:

From a social cost perspective, sending waste to a landfill is quite expensive, and the new regulations will force tons of waste to be sent to places like anaerobic digestion facilities at a much higher financial cost, but the social and environmental costs will, in the end, be less. Businesses will have to sort and separate their waste at the source–as they should–store it separately–why don’t they already do this?–and have it picked up by a separate vehicle—all of which will increase their costs and, ultimately, make them pay for the massive environmental and social damages that they have inflicted on their customers.

When a company doesn’t have to pay for the damages it causes (say, polluting a river), this is also expensive, but not necessarily for the company. The pollution is called an externality, since the company doesn’t have to pay. Externalities are problematic because those who cause them tend to not have to pay for them, and the costs end up being offloaded on people who are already impoverished. In the case of the polluted river, those people downstream will have to pay. Environmental economics is all about internalizing externalities.

Another example of an externality is climate change. While the world’s most affluent people consume the most and have a way bigger carbon footprint, it’s the world’s poor that will suffer the most from climate change. Similarly, consumers who get to shop at supermarkets pay a premium price for the nicest foods, while poor people line up at food banks, and simultaneously have landfills placed in their backyards.

In this way, making corporations pay for the food they dump in landfills is a pretty good idea: it’s holding people accountable that are externalizing what it costs to process food waste to society. Downstream, there will be less people paid by the state to process food, less equipment needed to bring food to landfills, and less greenhouse gasses emitted at the landfill. Upstream, this might actually have an effect on the food system: distributors will be forced to streamline their operations and limit food waste from the farm to the warehouse.

Copeland is on to something, though. Banning corporate food waste means that corporations will be forced to internalize that externality, and this will increase the costs of food. But it will also decrease other social and environmental costs, not measurable by money.

But there is something else at stake that Copeland doesn’t talk about. It’s highly probable that food distributors will just find another solution to the problem. Since the state doesn’t really care where the food goes, it just cares that it doesn’t go into a landfill, it’s totally conceivable that food distributors will find another solution. In the name of efficiency, it’s easier to outsource the costs of food processing to society. And there are plenty of people out there who are willing to work for free so they can give slightly old food to the needy.

When it becomes more and more difficult for companies to dispose of food waste, they’re going to be encouraged to outsource that processing, externalize it, so they don’t have to pay for it. This already happened in the 1970s, and the result was the establishement of a nation-wide network of food banks that run on volunteers and corporate sponsorship. Now that Massachussets has banned food dumping, corporations are just going to step up that process, and keepdumping their food waste on the poor.

“What’s the problem?” you might ask. “Food banks feed the poor, and food distributors don’t have to waste their food. Everybody wins.”

The problem is one of social cost. While the distributors make a mean profit, the working poor are now forced to spend time processing waste, transporting it, and handing it out to their own. Local social networks will become over-burdened, where more and  more people will be trying to solve hunger, not even getting paid to do it. What’s more, many people who volunteer at food banks are themselves often down-and-out, existing on meager pensions or attending because they themselves get food there. In effect, lower class people are treated as waste disposal units, mini-landfills, no strings attached. It’s their health, pockets, and communities that suffer.

I suggest an alternative solution to banning corporate food waste. Calculate how much time it takes for society to process a pound of food waste, multiply that by the minimum wage, and then fine food companies by the pound of food waste. Take that money, put it in a public trust, and use it to support local, grassroots, community food security initiatives.

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