Today's Seattle Times has a graphic outlining the environmental impacts of plastic bags. It says "Here’s a look at the environmental costs of bags," noting water use and CO2 emissions would be reduced. It indicates that water use for bag production will be reduced by 39 million gallons each year and it will reduce CO2 emissions by 6,000 tons each year. The estimated annual cost to achieve these goals is $10 million.
It is useful to put those numbers in context and relate the costs to the benefits.
One key question for any environmental policy is whether we could achieve the same environmental benefits for a lower cost. This is not only a concern about keeping taxes low (which in a tough economy should be reason enough), but it also asks whether we could do more for the environment with the same amount of money.
With regard to water and CO2 and even trash, the answer is "yes." Even if the bag tax performs as supporters promise, it wastes resources and misses opportunities to make real environmental improvements.
While 6,000 tons of CO2 sounds like quite a bit, it is actually a very small amount. In Europe it currently costs $20.52 to reduce one metric ton (2,204 lbs) of CO2. Reducing 6,000 short tons of CO2 would cost $111,731.40, or 1 percent of the cost of the bag tax.
When it comes to water, the Seattle Times' graphic notes that the tax would reduce the water used to make bags but doesn't put the number in context. Each day, Seattle uses about 130 million gallons of water. Reducing water use by 39 million gallons a year is less than one one-hundredth of one percent of water used in Seattle. Even that number is probably too high. Many of those 39 million gallons are used outside the city limits of Seattle, so reducing water use for bags doesn't reduce Seattle's direct water use. So, the amount of water saved by this tax is infinitesimal.
How much is that amount of water worth? Using residential rates, which have the highest marginal rates, the cost for 39 million gallons (5,213,904 cubic feet) is between $169,452 and $553,716 depending on the amount used, assuming use during peak times.
In other words, the bag tax will cost $10 million to create environmental benefits that could be acquired for $281,183.40.
Finally, the focus of most of the argument is on the reduction in trash in landfills. The Times estimates that plastic bags cost about $3.85 million annually to manage, about 2.5 percent of the total trash budget. Assuming that the bag tax reduces bag use by 50 percent, it could save $1.9 million each year. There are two things to understand about this number.
First, this number is high because it is unlikely that the City will reduce staffing or overhead costs because they still have to deal with all the other trash. Thus, a reduction of one percent in load does not equate to a one percent reduction in cost.
Second, it should be remembered that we already pay to collect that trash. While the bag tax increases costs for bags, it does not reduce the garbage taxes already being paid. So, Seattle taxpayers are unlikely to see any savings despite a reduction in trash volume. The Times does estimate that the City would use 47 fewer railcars of trash. Based on a rough estimate of cost per railcar, that amounts to less than $200,000 per year.
Adding the reductions in trash, water and CO2, the bag tax creates about $500,000 of benefit for $10 million in taxes.
Some will respond by saying that it is worthwhile to reduce our environmental footprint and that while the cost may be high, the need is great. But this argument is simply incorrect. Proponents of the bag tax claim to be concerned about waste of resources. Waste of money is waste of resources and the City could receive more environmental benefit by spending $1 million to reduce CO2, water and trash. The ironic conclusion is that the bag tax creates more waste by missing opportunities to reduce environmental impact.
Until environmental activists do a more rigorous analysis of the policies they propose, they will continue to support efforts that not only have little impact but are actually counterproductive.