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Chapter 2

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Council on Sustainable  Development

Chapter 2: Consumption

History and Scope of the Consumption Issue

Unlike traditional environmental issues-even population growth-consumption of materials and energy is not customarily considered a problem; indeed, it is welcomed in nearly all quarters as a good thing.

Agenda 21, in contrast, identifies "the unsustainable pattern of production and consumption, particularly in industrialized countries," as "the major cause of the continued deterioration of the global environment." Facts support this assertion: approximately 20 percent of the world's population in the late 1980s lived in industrialized countries. These countries consumed 85 percent of the aluminum and synthetic chemicals used in the world; 80 percent of paper, iron, and steel; 75 percent of timber and energy; 60 percent of meat, fertilizer, and cement; half the world's fish and grain; and 40 percent of the fresh water.

Varying by commodity, this scale of consumption ranges from three to 19 times the consumption levels of developing countries. Industrialized countries also generate most of the world's hazardous chemical wastes, 96 percent of radioactive wastes, and nearly 90 percent of all ozone- depleting chlorofluorocarbons.

The United States plays a singular role in the consumption of natural resources, even among industrialized countries. As the world's largest economy, the United States is the largest single consumer of natural resources, including fossil fuels, and is the greatest producer of wastes of all kinds.

Raw materials use in the United States multiplied 17 times between 1900 and 1989, during which the U.S. population multiplied three times. To yield the 4.5 billion tons of materials actually used in the United States annually (see box for details regarding the components of this total), about 10 billion tons of crude materials are handled. About half of that becomes waste, such as mining wastes, before any saleable products are made. Another billion tons of waste are generated in manufacturing and materials processing. About two billion tons of materials such as pesticides and fuels are dissipated into the environment during use. Americans product the most municipal waste per capita of any country on earth.

After consumers use a final product, it joins the 200 million tons of postconsumer waste produced in the United States annually. Americans produce the most municipal waste per capita of any country on earth. The United States is also the leading producer of greenhouse gas emissions (contributing 19 percent of total world emissions in 1991) and is probably the world's largest producer of toxic wastes.

U.S. Natural Resource Use, 1989
(In Millions of Metric Tons)
1,800 : construction materials
1, 700 : energy fuel
317: food (meat and grains)
317: industrial minerals
157: forestry products (including paper)
109: metals
107: nonrenewable organic materials (asphalt, chemicals)
7: natural fiber

Source: World Resources Institute, 1994

Not surprisingly, US. natural resource use per capita is high compared with average world consumption. In 1990, Americans used nearly seven times the world average in plastic and petroleum feedstocks per capita; over six times the synthetic fibers and aluminum; nearly five times the industrial salt (used to salt roads, for example); four or more times the potash, industrial sand and gravel, and copper; around three times the nitrogen, iron, and steel; about twice the bauxite, phosphate, and iron ore; and one and a half times the cement.

Except for petroleum, bauxite, and potash, 70 percent or more of the mineral and metal commodities consumed in the United States is also produced here. Thus, the environmental- impacts of mining, processing, and transport take place domestically as well.

When people think of resource consumption in the United States, they often think that per capita consumption is rising. This is true only for plastic and paper. Total resource consumption is still on the increase, however, illustrating the power of population growth alone to increase environmental stress from resource use.

Interestingly, the composition of materials used in the US. economy is changing, as lightweight but high-volume materials, such as paper and plastic, increasingly substitute for dense, heavy materials, such as metals. During the 1980s, the United States used a greater volume of plastic than of all metals combined. This has important implications for solid waste disposal as the volume of wastes increases.

As the world becomes increasingly aware of the environmental impact of pattern and scale in natural resource production and consumption, it will look to the United States, with its large role in that problem, for leadership. It also makes sense for the United States to address the sustainability of U.S. production and consumption out of sheer self-interest in domestic environmental quality.

Further, while the data is not comprehensive, studies indicate that consumption is not buying the high quality of life desired by Americans. In the last 20 years, personal consumption of goods and services has risen by an estimated 45 percent. But an Index of Social Health-which subtracts from the positive features of American life such things as child abuse, teen suicide, and the gap between rich and poor-has dropped by more than half.

To address the enormous issue of consumption of natural resources, economists, environmentalists, and others often call for decoupling materials and energy use from economic prosperity-in addition to other noneconomic environmental policies. This means reducing the amount of materials and energy needed to make and do all the things that Americans use, whether it is industrial machinery, roads, computers, houses, cars, household appliances, transportation, or heat. It means getting more out of each unit of material and energy: making and doing everything more efficiently, or raising resource productivity. Analysts of natural resource consumption agree that one overriding economic condition is the most powerful force encouraging inefficient use of natural resources. Throughout the entire life-cycle of natural resources, the resources themselves are nearly free of cost in traditional economic terms. Any harm done to the environment costs nothing on anyone's balance sheet except when environmental laws impose a partial cost. Thus, existing prices of natural resources generally do not reflect true environmental costs.

Neither industries, retail firms, governments, nor individual consumers, therefore, have an incentive to use natural resources frugally. They are artificially cheap, and gross national product and other measurements of economic health do not capture environmental harm.

In the absence of "internalizing" environmental costs, Americans pay for environmental damage after it occurs, which is generally inefficient. Practical experience reinforces the adage that the cost of prevention is far less than the cost of the cure.

It is also widely agreed that a single strategy would, at less cost than command-and-control regulation, encourage the efficient use of natural resources, reduce waste and environmental harm of all kinds, and promote the development of technologies to improve efficiency and provide alternatives to existing practices. That strategy is to let the price of natural resources rise to reflect "the ecological truth."

The tools for achieving a price increase are twofold: imposing charges and reducing subsidies.

Market-based economic instruments such as taxes, charges, fees, deposit-retum charges, or tradable-permit schemes, may be imposed on effluent, emissions, and environmentally damaging activities or products. Under this strategy, environmental "bads," such as water and air pollution, sulfur-containing materials, or toxic chemicals, could be taxed, while purchase of potentially harmful materials, such as lead-acid batteries and automobile tires, might include a deposit that is redeemed when the products are returned safely for disposal.

The counterpart to imposing charges or fees is to remove subsidies that keep the price of environmentally harmful activities and products artificially low. Such subsidies include federal sales of national forest timber and Bureau of Reclamation-managed water at below-market prices.

Environmental fees, charges, and other economic instruments are often proposed as part of broader tax reform proposals aimed at shifting taxes from income and savings to "consumption" in its traditional economic sense-the use of goods and services to meet current wants. A broad "tax shift," as it is usually called, has the benefit of encouraging savings and investment. (The U.S. savings rate is currently at 3.6 percent of gross domestic product, very low in comparison with that of its trading partners.)

Savings and investment are the principal sources of funds for financing the machinery, buildings, and other capital investments that drive economic activities. Savings and investment also drive technological developments, such as ways to raise resource productivity and develop alternatives to materials and uses that harm the environment. Indeed, as sustainable development depends heavily on technological innovation, it depends heavily on savings and investment.

Environmental taxes imposed as part of a comprehensive tax shift could be revenue neutral, replacing taxes on income, payroll, and savings on a dollar-for-dollar basis. Environmental taxes introduced piecemeal could also be made revenue neutral by substituting for selected existing taxes, again dollar-for-dollar.


As with population issues, the Task Force recommendations on consumption drew from material presented at the Task Force's roundtables, as well as from the expertise of Task Force members, their liaisons, and non-Council Task Force members. As in the population chapter, relevant policy recommendations of the Task Force are listed before each section below.

Shifting Taxes The federal government should reorient fiscal policy to shift the tax burden from labor and investment toward consumption, particularly consumption of natural resources, virgin materials, and goods and services that pose significant environmental risks. In this process, the federal government should seek replacement revenue measures that encourage maximum economic, energy, and materials use efficiency. Finally, in order to alleviate concerns about regressivity, and, in fact, to promote a more progressive system of taxation, the federal government should offset consumption taxes at the lower end of the economic scale with corresponding reductions in payroll taxes.
Reducing Inefficient and Environmentally Harmful Subsidies Inefficient and environmentally harmful government subsidies, particularly those related to natural resource extraction and use, should be eliminated.

The Price Factor
Without a doubt, prices are powerfully capable of changing the ways a resource is used. As price goes up, use of a resource generally goes down, though the precise extent varies.

The American experience with energy during the 1970s and early 1980s is often offered as evidence of the way price-hikes reduce per capita use and promote efficiency and technological innovation. After years of paralleling economic activity, the rate of total energy use stabilized during the 1970s and early 1980s, even as GDP grew. Similarly, per capita use of all energy fell during that time, and average fuel economy (miles per gallon of gasoline) rose nearly 60 percent. (Total energy use in the transportation sector grew during this period, illustrating the impact of a growing population and increased consumption in another form-vehicle-miles traveled per person.)

Existing Provisions
Federal market-based environmental policy instruments already exist in the United States, though they were usually adopted to raise revenue rather than to achieve environmental ends. The federal tax code currently allows tax credits for the production of ethanol and other renewable fuels, imposes excise taxes on gas-guzzling cars and chemicals that deplete the ozone layer, taxes crude oil and imported petroleum products to finance the Oil Spill Liability Trust Fund and Superfund, and allows charitable deductions against income or estate taxes for donations of land or conservation easements. Perhaps the best-known economic instrument in federal environmental policy is the tradable permit scheme for sulfur emissions developed under the Clean Air Act Amendments of 1990.

State and local jurisdictions also impose a number of fees and related charges that affect the environment. Numerous states levy severance taxes on petroleum and other mineral resource extraction, have deposit-refund schemes for beverage bottles, and impose packaging taxes. Many municipalities impose user fees for local solid waste disposal and offer recycling incentives. The precise forms and degree of these taxes vary greatly.

Damaging Policies
At the same time, both federal and state tax codes encourage a number of environmentally damaging activities and discourage beneficial ones by lowering production costs and distorting the true price of resource-related activity. At the federal level, for example, farmers can deduct from their taxable income part of the value of groundwater withdrawn for irrigation beyond annual recharge. Employers can provide free-parking to employees as a tax-free fringe benefit, and businesses engaged principally in natural resource development or processing may avoid the corporate tax. Owners of interests in fuel and nonfuel minerals can take "percentage depletion" deductions against taxable income from the mining enterprise, deductions that may ultimately exceed the taxpayer's total capital investment. For a tax shift to become real, more fully developed rationales, public participation, and the support of the business community are required.

The percentage depletion allowance has enormous reach. The Office of Management and Budget has estimated that the federal government loses more than $1 billion annually to this deduction, which partially pays for production of some of the country's most toxic minerals, among them lead, mercury, and asbestos.

Federal law also encourages environmentally destructive activities with programmatic subsidies outside the tax code. Below-cost timber sales and road building, below-market grazing fees, the treatment of hard-rock mining under the 1872 Mining Law, below- market charges for irrigation water, below-market charges for federal power, agricultural subsidies, subsidies for highway construction, and federally underwritten insurance are among the programs that distort the cost of natural resources. All of these subsidies shift part of the true cost of doing resource-related business from the resource developer or user to the taxpayer.

The introduction of new environmental fees or taxes and the elimination of existing subsidies that harm the environment are two sides of the same policy coin. Developing new taxes without eliminating subsidies is, again, like working to reduce natural resource consumption without stabilizing population-akin to walking up a down escalator.

Benefits of a Tax Shift
Of all 1991 federal tax receipts, 42 percent came from payroll taxes, 41 percent from personal income taxes, and 9 percent from corporate income taxes. (Corporate income taxes ultimately tax investments and capital gains, because the costs are borne by stockholders.) Nearly all taxes work to discourage the activities being taxed and encourage alternatives. Similarly, taxes on payroll make workers more expensive to employers, therefore inducing employers to find alternatives such as layoffs, heavier work loads on a smaller workforce, automation, or moving operations overseas. Taxes on income from investments lower after-tax returns, encouraging people to seek tax shelters or to invest less. Thus, taxes on income, payroll, and corporate income have economic costs in the form of lost income and investment.

World Resources Institute (WRI) analysts looked at the effects of a tax shift that would tax resources and pollution instead of income and investment. They found that every dollar shifted could gain the economy-in the form of additional work and investment and in environmental damages averted-$O.45 to $0.80 beyond the revenues replaced.

Without the disincentive from taxes on work and investment, more people would work and make investments, thus adding to income and investment. With the disincentive applied to pollution and resource use, pollution and environmental harm would be discouraged. The WRI study calculates benefits in the aggregate. Individuals and firms in some businesses would experience losses, as with any change in tax policy. The long-term effect, however, is positive.

Thus, environmental taxes are very likely to meet the requirement of all taxes that they be "economically rational," or raise revenue at the least overall cost to the economy.

Meeting the Standards
Environmental taxes must also meet standards of equity, administrative feasibility, and stability of the revenue stream required of any tax. These concerns are real. A system of environmental taxes would require a change in administration and enforcement, as well as coordination among now separate agencies dealing with natural resources, the environment, and taxes. The new taxes would, however, resemble existing excise and sales taxes, and both federal and state tax authorities have considerable experience with those. Some criticize environmental taxes on the grounds that stability of revenue cannot be guaranteed. But careful framing-including gradual increases in tax rates, periodic adjustments, and changes in the targets of taxes--can counter these concerns.

Similar treatment of taxpayers in similar situations and taxation according to ability to pay are of particular concern to the Task Force. Provisions of any tax shift can compensate for regressivity through a number of measures: rebates to individuals and businesses disproportionately affected by a tax; income and payroll tax credits or deductions; and investment of revenues in worker training or other appropriate compensatory programs, particularly for the poor who do not pay taxes. The sustained public conversation on the tax shift issue that the Task Force envisions will allow the fall airing of concerns over the possible uneven burden of such a shift on specific populations; for example, tribal governments may be especially dependent on payroll taxes, and provisions of a tax shift can be crafted to alleviate disproportionate impacts.

In the course of the debate that would necessarily swirl around any proposed tax shift, it is crucial that empirical analyses make the distributional effects clear, in order to avoid misinformation about "winners" and "losers." It is also important in the calculation of benefits and burdens to use as a baseline or benchmark for comparison other tools for implementing environmental policy, rather than an imaginary "no environmental policy," which would artificially increase the apparent burden of the tax shift policy. At the same time, valid analysis of "losers"-workers in particular resource industries, for example-will allow precise tailoring of the tax shift to compensate for short-term local effects.

The Population and Consumption Task Force recognizes that a tax shift represents a significant change in many quarters, requiring consumer and taxpayer education and administrative realignment. But no other single policy step could so effectively and at so low a cost move the country toward more efficient-and eventually sustainable-resource use.

The Task Force's goal in recommending a tax shift and the elimination of environmentally harmful subsidies is not to put forward a fully worked out, take-it-or-leave-it proposal-either within the President's Council on Sustainable Development or in the broader policymaking arena. Since such a proposal is the most powerful option available for moving significantly toward sustainable resource use in the United States, we are calling for thoughtful analysis and political discussion to work out the details and make such a policy a political possibility.

Public Involvement
We note that for a tax shift to become real, more fully developed rationales, public participation, and the support of the business community are required. We also note, with optimism, that the polluter-pays principle receives broad public acceptance as a fair and efficient approach to environmental policy, and market-based instruments often receive support from both sides of the political aisle.

Finally, we urge that today s tax reform debate be opened to consideration of a tax shift for implementing environmental policy. It makes sense to us, and we think it could make sense to many Americans, to be able to reduce one's tax bill as an individual or a corporation by saving resources or developing a new technology for increasing materials and energy efficiency, rather than by working and earning less-as economists say that taxes on income and investment make us do-or by taking advantage of tax loopholes, which are the only options available today.

If unsustainable goods and services cost more than sustainable ones, it would provide an instantaneous and powerful environmental education to consumers of all kinds, from households to large industries and governments. It is the Task Force's belief that the marketplace should soon reflect environmental costs and that prices should be moving the United States effectively toward sustainability.

Environmental taxes, charges, fees, and other economic instruments, however, whether part of a comprehensive tax shift or not, represent a dramatic change from the status quo and will no doubt take time. To move the country toward more efficient use of resources in the meantime; to enlist the considerable power of individual consumers, most of them eager to do environmental good; to enable consumers to make wise choices in the marketplace, and to build popular support for difficult political changes in the future, it is important to educate consumers and make available the full range of information required for good environmental citizenship.

Individual Americans are eager to make a difference to the environment with their own actions. In a poll released by ICR Research of New York in April 1995, 85 percent of respondents said they "were interested in doing more in their daily lives to help the environment." And most agree that sustainability requires making changes.

Nearly 90 percent of those surveyed in a national poll commissioned by the Merck Family Fund and conducted by the Harwood Group agreed that "protecting the environment will require most of us to make major changes in the way we live." Nearly half said, "if we all reduced the amount of stuff we consume," it would make a big difference to helping the environment. Another 40 percent said that it would make some difference.

Education's Effects
Education can make a dramatic difference. In its experience teaching 300,000 people money management and financial independence, the New Road Map Foundation has found that, on average, people reduce their spending by 20 percent simply by attending to and tracking what they spend-without making any effort to cut down or eliminate purchases.

The program Global Action Plan for the Earth, which enlists households in resource saving, has found after five years of experience that households participating in their program reduce what they send to the landfill by 42 percent, cut water use by 26 percent, push carbon dioxide emissions down by 16 percent, and cut transportation fuel use by 15 percent. On average, participating households saved over $400 in the course of the program.

The Population and Consumption Task Force focused on several aspects of consumer education. We first considered labeling products so that buyers can know the full environmental impact of a product throughout its entire life-cycle. So-called "green labeling" or "eco-labeling" is both a powerful force for wise consumption practices and desired by consumers frustrated by existing product claims.

Next, the Task Force considered "greening" government procurement-harnessing the more than $400 billion the federal government spends purchasing goods from the private sector. Our recommendation builds on existing efforts under President Clinton's 1993 Executive Order calling for the federal government to buy environmentally preferable paper products and to give preference generally to "green" products.

The Task Force's recommendations also deal with six aspects of public education: formal education; media messages; advertising; education for fiscal responsibility; community education; and the development of a stewardship ethic.

Environmental Labeling and Certification A public-private partnership should be established to develop criteria based on life-cycle analysis for labeling certain goods and services environmentally superior. An appropriate third-party, nongovernmental entity working with public and private sector experts should certify these products as a voluntary incentive program. After a necessary development phase, the third-party entity will be self-financed.

Perhaps the greatest leverage individuals can have on the environment is through their hundreds of billions of dollars of annual purchasing power. According to a poll by the National Consumer's League released in April 1995, 80 percent of consumers say they think of environmental considerations when shopping for groceries and household products.

Yet, it is very difficult for an individual consumer to "buy green." An examination of hundreds of supermarket products over the past five years revealed recently that although more companies are using labels designating products "recyclable" or "biodegradable," the terms are used more to attract consumers than to inform accurately.

Terms such as "environmentally friendly" are used a third more often in 1995 than they were in 1992, according to a study by researchers at the University of Utah, Oregon State University, and the University of Illinois. And yet the precise meaning of these terms is far from clear. Norman Dean of Green Seal has found examples of telephones labeled "foam-free," when ordinary telephones use no foam; of light bulbs labeled as "using 10 percent less energy" when they also produce 10 percent less light than the comparison light bulb. All of this contributes to enormous consumer confusion, if not cynicism.

Even without confusing or deceptive claims by manufacturers, it is difficult and time consuming for an individual to make an informed choice. The complexity of weighing all the environmental issues involved in whether to choose cloth or disposable diapers is a good example. Whereas disposable diapers have a large impact in materials use and on landfill space-constituting roughly four percent of the municipal solid waste stream-delivering and washing cloth diapers have environmental impacts in the form of detergents, water use, and air pollution.

Life-Cycle Analysis
A proper analysis should consider environmental impacts from the entire life-cycle of a commodity: whether the paper used to make disposable diapers was recycled or came from virgin materials, and, if from virgin materials, whether from a forest managed sustainably; whether cloth diapers were made from cotton grown with heavy pesticide use, or in an area where water is scarce; and whether raw materials growers or processors and manufacturers have fair hiring practices. Variations in local conditions-landfill space constraints are more important in some places, while water scarcities dominate in others-also matter. It is difficult for experts to determine the right choice, never mind a harried parent hurrying through a grocery store with no time to spare for rumination.

It is widely agreed that solving these problems requires holding manufacturers and advertisers to standards of honesty and fairness. This is discussed below in the section on Public Education. Another requirement is to develop life-cycle analyses by which to judge the environmental performance of appropriate products and label them accordingly-usually by stating whether a product meets a particular standard of acceptability. Such a label would parallel the popular nutritional labels now on food in grocery stores.

Twenty-one countries have "green labeling" or "eco-labeling programs," including Germany's "Blue Angel," Canada's "Environmental Choice," and Japan's "EcoMark." The European Union and China are both developing programs. In the United States, a fledgling private program exists under the group Green Seal.

Elements of an Eco-Labeling Program
Eco-labeling involves two steps. Based on life-cycle analysis, the first step involves establishing product criteria and setting standards that products must meet to be deemed environmentally acceptable or superior. Using the diaper example, analysts would choose criteria such as percent of virgin material, percent of secondary material, methods of production of virgin material, and compostability-to name just a few.

Then, analysts set the standard within each criterion that a product must meet to win approval. For the diapers, these might be no more than 40 percent virgin material and complete return to natural materials within 10 years, under certain specified composting conditions.

For the second step, experts--often independent entities such as the International Standards Organization, the International Society for the Testing of Materials, or Underwriters Laboratory--test and certify actual products. At this stage, continuing the diaper example, analysts would evaluate Pampers, Huggies, Luvs, and other brands of both disposable and cloth diapers to see which meet the standards and merit an environmental seal of approval.

The group of experts that certifies and awards the seal of approval for products should be an independent, or "third party" entity-neither private-sector manufacturers nor the government- capable of fostering an effective program.

A good program also has certain other characteristics: it involves all key interests (businesses, consumer and environmental groups, and governments, for example); it is open, public, and involves peer review; its certification and assessment processes are transparent; its data are independently verifiable; it is accompanied by a public education program; its standards and criteria are updated as science and technology change; and the cost of obtaining the seal of approval does not keep small- and medium-sized companies from participating.

Environmental labeling programs provide consumers with an immediately available, objective, and accurate evaluation of a product's environmental impact. They also provide an incentive to manufacturers to meet the standards-to make products with environmental impact deemed technically acceptable by an unbiased, third-party entity.

To the Task Force, these programs are powerful strategies for educating the consuming public. In addition, they allow U.S. manufacturers to compete in a marketplace increasingly emphasizing clean products, as the labeling programs of the EU, Canada, Germany, Japan, and China attest.

Government Procurement Government procurement procedures should be reformed to increase the use of environmentally preferable products whose full life-cycle costs are most economical. Consideration should be given to insuring that only certified environmentally preferable products within product categories for which standards/criteria have been established will be available for purchase by the U.S. government. In addition, the federal government should join with the private sector in offering incentives, in the form of guaranteed purchase awards, to businesses that create new products exceeding the standards for environmental superiority.

Government Procurement
The federal government is the single largest consumer of goods, products, and services in the United States and spends an enormous sum every year buying goods from private-sector suppliers. It is the largest single consumer of paper in the world.

With this purchasing power, the federal government can have a significant impact on markets for-and on the commercial viability of-recycled and other environmentally superior goods. At the same time, the government can set an example for other U.S..consumers, both individual and institutional; it can strike a blow for sustainability; and it can move toward operating at the least possible cost to society, both in economic and environmental terms.

RCRA Requirements
The federal government already makes some effort to "buy green." Section 6002 of the 1976 Resource Conservation and Recovery Act (RCRA) calls for the federal government to buy recycled products. Under the law, the U.S. Environmental Protection Agency (EPA) designates procurement items and their recycled content, and agencies buying these items must match or exceed the recycled content of the EPA designations-within the constraints of price, competition, availability, and performance.

By 1993, the EPA had issued guidelines for only five products (cement, paper, lubricating oil, tires, and insulation), a poor showing, and the percentage of federal purchases of these commodities that were recycled was not impressive. (Although 80 percent of insulation purchased met the guidelines, less than 50 percent of paper, 33 percent of cement, five percent of tires, and one percent of oil did.)

Since 1993, President Clinton has significantly strengthened the government's green procurement efforts with a series of six Executive Orders. They deal with recycling and waste prevention, ozone-depleting substances, alternative-fueled vehicles, energy-efficient computers, pollution prevention, energy efficiency, and water conservation.

New EPA Guidelines
The EPA has now issued guidelines for 21 additional products, from engine coolants and plastic piping to carpeting and plastic trash bags. The federal government has also accelerated purchase of alternative-fueled vehicles and products without ozone-depleting chemicals.

Despite these efforts, green procurement by the federal government remains a small part of the total. The process is complex and time-consuming, and the exceptions in Section 6002 are numerous. To flex the muscle of its considerable purchasing power in favor of sustainability, the government needs to accelerate, intensify, and broaden its existing efforts. In particular, it needs to modify the requirement that goods be purchased at the lowest price.

Public Education and the Development of a Stewardship Ethic Educate all sectors of society in numerous ways about consumer practices and choices that will lead to sustainable consumption patterns and lifestyles and about living in accord with a stewardship ethic.

Direct and indirect, formal and informal educational programs for consumers are appropriate strategies for creating the awareness required to move toward sustainable levels of consumption. The Population and Consumption Task Force examined six kinds of public education: formal education, media messages, advertising, educating for financial literacy, community education, and development of a stewardship ethic.

Formal Education
The Population and Consumption Task Force refers the reader to the report of the Public Linkage, Dialogue and Education Task Force of the PCSD, which examines the issue of incorporating sustainability issues into formal and informal education and makes detailed recommendations on this score. We support that Task Force's work and add our voice to the call for broad environmental education in our formal educational system. We are particularly interested in educating consumers to evaluate advertisers' claims so that they can distinguish emotional manipulation from objective information and are able to make prudent, considered choices.

Mass Media
Mass media powerfully drives consumption patterns in the United States and is an equally powerful force for changing consumer behavior. Family planning programs in some developing countries have found that incorporating story lines in television shows can promote responsible sexual behavior. Story lines about the benefits of postponing sexual activity and using birth control--and the harm that can follow not doing these thing--can be a powerful force encouraging viewers to think about responsible sexual behavior.

We certainly know that stories showing wealth become models of a desirable lifestyle to many viewers. The media could instead be an influential source of education about sustainable ways of living.

In an average American life, an entire year is spent watching television commercials. By the time they graduate from high school, typical American teenagers have been exposed to 360,000 advertisements. Thousands of consumer messages a day tell Americans to buy things. Advertisements are often the only source of information a consumer has about a product, and as discussed in the section above on eco-labeling, complex information is required for a consumer to make an informed decision about the environmental impact of a product.

In 1992, the Federal Trade Commission (FTC) undertook to hold advertisers and manufacturers to a standard of honesty and fairness, issuing "Guides for the Use of Environmental Marketing Claims." These guides describe various terms such as "biodegradable ... .. compostable," "recyclable," and "ozone safe." Marketers are asked to avoid certain claims likely to be misleading and to qualify other claims to avoid deception - the guides are not legally enforceable, but provide guidance only.

The FTC is currently gathering public comment on whether to modify the guides. Observers note that it would aid consumer education to strengthen the FFC's efforts, in particular by standardizing definitions. An internal code of ethics, developed and adopted by advertisers themselves, would also improve advertising's ability to educate consumers.

Financial Literacy
We also call for formal and informal education, adult education, and other avenues of public education to teach individual fiscal responsibility so that individuals know how to live within their means and steward personal resources. A citizenry that values savings and knows how to save money understands sustainability at a personal level.

As a matter of economic definition, whatever is saved is not used for consumption. Yet savings in the United States are abysmally low and falling, while current consumption is high and often financed with rising levels of debt.

The average 50-year-old American has saved $2,300 for retirement. About half of all grocery and hardware store purchases are made on impulse. In 1990, 83 percent of disposable income was spent on personal debt payments. Consumer debt increased 140 percent in the 1980s; in 1993, 4.2 percent of disposable personal income was allotted to savings, compared to 8.6 percent in 1973.

A higher savings rate would contribute not only to individual financial soundness, it would also buttress the national need to increase savings for financing economic prosperity and technological change. And it would empower individuals to live within their means-sustainably.

Work Patterns
Another way of moderating high-consumption lifestyles in the United States would also aid in job creation, reduce employee stress, and allow Americans to turn to nonmaterial sources of satisfaction-modifying work schedules for greater flexibility.

Working Americans today typically spend 163 more hours on the job annually than they did in 1969, contributing to a pervasive sense of being rushed and overworked. Nearly 70 percent of Americans would like to "slow down and live a more relaxed life." Seventy percent of Americans earning over $30,000 a year say in response to questioning that they would give up a day's pay each week for a day of free time; nearly half of Americans earning less than $20,000 would make the same trade. A third of American workers would forego raises and promotions to spend more time with their families.

Greater flexibility in work schedules would allow workers to take wage increases in the form of time rather than money-a trade-off a large percentage of Americans would like to make, and one that would also contribute to a more sustainable way of life.

Community-Based Education
Education programs based in communities are capable of making the message of sustainability particularly relevant to individuals at the local level. Landfill closings, difficulties over siting new ones, water shortages, congested highways, and fiscal constraints on new construction have already sparked programs to educate individuals about recycling, composting, water and energy conservation, ride-sharing, and other strategies for sustainable ways of living.

The local results are readily apparent once programs are in place. Further efforts are an appropriate focus of public education for sustainability.

Stewardship Ethic
Concern for the environment and the growing gap between the rich and the poor at home and abroad are leading many Americans to give new and serious attention to humanity's moral responsibility to care for the planet, its people, and the generations that will follow. Ninety percent of Americans polled by the Merck Family Fund agreed that "an underlying cause of environmental problems is that we focus too much on getting what we want now and not enough on future generations."

Religious communities have for centuries examined what is today called sustainability, terming it stewardship. Stewardship derives from the perception that creation is a gift from God that includes the responsibility to care for it. Also, certain American intellectual traditions, not part of a formal religion, have examined the same terri tory in determining the nature of the "good life." These traditions include civic republicanism, the thinking of Ralph Waldo Emerson, and John Dewey's progressivism. Most Americans associate themselves with a religious community. Recent polls reveal that more than 90 percent express a religious preference, two-thirds are members of a church or synagogue, 40 percent of adults attend services in any given week, and more than half say that religion is "very important in their lives." The vast majority of America's religious communities embrace an understanding of the stewardship tradition. A North American Coalition on Religion and Ecology (NACRE) poll of 30 Christian denominations found that 93 percent support the notion of stewardship of the Earth. Eastern and Native American religious traditions are rich with respect for the Earth. Religious communities have nurtured the concept of stewardship over the centuries and have much to share with those who are struggling to arrive at models for sustainable living today.

Various U.S. ecumenical and interfaith organizations have had an interest in environmental concerns for some decades. The National Council of Churches established an Environmental Stewardship Action Team in 1969. During the 1970s and 1980s, congregations all over the country concerned themselves with grassroots issues such as energy efficiency and recycling, while theologians examining the doctrine of creation and the concept of stewardship created a large scholarly literature.

The World Council of Churches worked throughout the 1980s on a program entitled, "Justice, Peace, and the Integrity of Creation." NACRE participated strongly in Earth Day 1990 activities. The National Religious Partnership for the Environment was launched in 1993 at the White House, bringing together major Catholic, Jewish, and Protestant institutions. Faith communities were a major presence at both the 1992 Earth Summit in Rio de Janeiro and the 1994 International Conference on Population and Development.

Much reflection on the concept of stewardship centers around four interacting moral concerns. The first is a commitment to sustainability-the same kind of sustainability discussed in this Task Force report, or a belief that current practices resulting in deforestation, groundwater mining, pollution, and other assaults on the health of the natural world must be corrected. The Native American concern for the seventh future generation has become a widely embraced example of the commitment to sustainability.

The second moral concern is represented in a commitment to live in solidarity with the poor. Religious communities are making connections between social injustice and environmental degradation and are drawing attention to environmental justice and the need to fight poverty at home and abroad.

The third and related concern is a commitment to sufficiency. Religious communities emphasize that all people have a moral right to certain basic human needs, and that "the good life" is discovered more in the sharing of wealth than in its accumulation.

Finally, many religious communities insist that all people must have the ability to participate in the decisions that affect their lives.

This rejuvenated reflection on the ancient stewardship tradition has given rise to a critical examination of materialism in American culture. A recent poll taken by Princeton University's Center for the Study of American Religion found that 74 percent of working Americans believe that materialism is a serious social problem in the United States. And yet, apparently without ambivalence, Americans live the most material-intensive lives of anyone in the world.

This contradiction is an indication of how difficult it is to live out an ethic of stewardship and achieve sustainability-to resolve the contradictions between moral beliefs and the messages and incentives sent by the larger society. Religious communities have nurtured the concept of stewardship over the centuries and have much to share with those who are struggling to arrive at models for sustainable living today.

Further elaboration of an explicit ethic of stewardship-care for all creation, for all time-would enrich understanding of sustainable ways of living, would provide grounds for choosing the most moral among the many alternative ways of living sustainably, and would inspire commitment to sustainable ways of life.

Reduction, Reuse, and Recycling of Packaging Materials The federal government should find ways to encourage U.S. manufacturers to ensure the appropriate reduction,recycling, reuse, and disposal-outside the traditional municipal waste stream-of all packaging they produce. Manufacturers, retailers, and distributors should work together to make packaging materials returnable to - manufacturers. A public-private partnership financed by manufacturers should certify packaging for sustainability.

Environmental analysts have been focusing increasingly on the way raw materials are used:[4] the consequences of extracting raw materials from the earth or from ecosystems through careless or wasteful mining and harvesting; of processing raw materials into products inefficiently; of designing products to be used once, sometimes briefly, and then discarded; of the difficulty of repairing goods; of the challenge facing those who wish to recycle the essential materials of products for use in something else; of the environmental, social, and economic costs of municipal landfills, space for which is increasingly scarce while the long-term effects of toxicity are just coming to be known; and of the environmental, social, and economic costs of incineration.

A new way of dealing with materials is needed that reduces the total volume handled and cuts reliance on virgin resources. The economy must use both raw and secondary materials more efficiently; rely lightly on the extraction of raw materials and reuse and recycle materials already used once; and it must design products for durability, ease of repair, and ease of recycling. This approach not only uses creatively what has until now been considered waste; it also produces less waste in the first place.

The implementation of the first two policy recommendations of the Task Force (a tax shift and elimination of environmentally harmful subsidies) would move significantly in the direction of a new materials economy. In addition, important work undertaken by the Eco-Efficiency Task Force, which we support, broadly defines a system to encourage extended product responsibility. It would seek to ensure that designers, suppliers, manufacturers, distributors, users, and disposers all take responsibility for a product's environmental impact.

The Population and Consumption Task Force adds to these recommendations strategies for three selected materials issues. We do this to draw attention to some practical ideas that build on the Eco-Efficiency report, but also to demonstrate the importance of identifying strategies in which all Americans can participate. Furthermore, we believe that these policies give effect to two themes essential to encouraging more efficient consumption: responsibility (corporate and individual)and the use of market-based tools with with or apart from tax shifts and subsidy reduction.

The Population and Consumption Task Force's three recommendations in the materials area call for:

  • streamlining of packaging materials;
  • weight-based municipal garbage fees; and
  • proper handling of household toxics.

We target these three for a combination of reasons. Packaging and garbage are well understood by the public, which is deeply concerned about them and can affect each directly. Both, in turn, affect the public daily, and working on them can keep people engaged in issues related to sustainability. Toxis materials are dangerous, concern the public deeply, and are more pervasive than most people know.

Packaging is an important component of the total municipal waste stream in the United States, and municipal waste is an important piece of the nation's total waste picture. Finally, consumer waste is critically important in shaping the marketplace, for consumers' demand for goods they can reuse, recycle, and repair will feed back to manufacturers.

These three issues-packaging, municipal garbage, and toxics in the waste stream-interact. Streamlining packaging would reduce household and commercial waste, thereby letting consumers avoid the highest garbage collection fees. The garbage-fee proposal, by supporting recycling, helps create a reliable supply of used materials. Finally, reducing packaging takes some toxic materials out of the waste stream. Details of these three proposals follow.

Streamlining Packaging in the United States
Packaging made up one-third of the municipal waste stream in the United States in 1990 and has grown rapidly in volume in the past several decades. Reflecting the fact that only paper and plastic use is rising in per capita and per GDP terms today, 53 percent of the municipal waste stream is paper or plastic. One-fourth is glass, also important to packaging.

Manufacturers, wisely responding to existing price signals, currently have no incentive to reduce packaging or design it for efficiency of production or ease of reuse and recycling. Essentially, the cycle of responsibility is broken once a consumer buys a product; then it is the consumer's job to dispose of it, not the manufacturer's. This is so even though many consumers actively wish for less packaging.

Making manufacturers responsible for recycling and disposal of the packaging they produce would "close the loop" and put incentives to design for efficiency, reuse, and recycling just where the authority to do it lies-with the manufacturers. Such a program would rely on the initiative and ingenuity of manufacturers to design their own, and likely best, response to the need to reduce, reuse, and recycle packaging.

The German Program
Germany, which produces more than 23 million tons of household wastes annually, has four years of experience with placing responsibility on manufacturers for the packaging they produce. The United States can learn from the successful and unsuccessful features of Germany's program how best to frame policies for reducing packaging.

The 1991 German Ordinance for the Avoidance of Packaging Waste specifically calls for manufacturers to reuse packaging or pay for recycling it. The program divides packaging into transport use (pallets, crates, corrugated containers, and the like); secondary packaging (packaging that does not directly contain the product being sold, such as outer boxes and cellophane wrapping); and primary packaging (bags, boxes, tubs, tubes, and other containers that actually hold the product being sold). Different requirements are placed on each kind of packaging-the percent of all packaging that must be reused or recycled-and are phased in gradually.

Consumers are able to leave at stores any secondary packaging they do not want, after paying for the product it held. Retailers must pay for the removal and recycling of the discarded materials, which creates an incentive for them to press suppliers to reduce packaging. Retailers also must take back primary packaging after consumers use up the product; mandated deposits on certain containers (beverage bottles, paint cans, and detergents, for example) create an incentive for consumers to return them to retailers.

Distributors then return the packaging to manufacturers, who are required to reuse it or recycle it privately, outside the municipal waste stream. The law also allows manufacturers to pool resources to form a large collection and recycling system. In line with this option, German industry has established a program by which materials are certified for recyclability-given a "Green Dot"-which has produced numerous changes in packaging design.

Fees from manufacturers based on the weight of packaging they produce funded the certification and collection program in the first few years. But problems with markets for the large amount of plastics collected, and unanticipated collection costs, marred the German program's experience in its first two years. In response, the program shifted to a sliding fee scale based on the ease of recycling each material and is now more financially sound. As a result of the fee structure, one- third of plastic's share of the market shifted to more easily recycled paperboard and glass. In fact, the fee now constitutes two-thirds of the price of plastic packaging in Germany.

The European Union Plan
The European Union recently adopted a packaging directive that must be incorporated in national laws by June 30, 1996. It calls for 50 to 65 percent of packaging to be "recovered" within five years of passage of the national laws (recovery includes recycling, composting, and incineration) and establishes percentages of packaging waste and material that must be recycled. Standards based on life-cycle analysis will be prepared for determining packaging acceptability with regard to heavy metals content, recycled content, and recycling and composting methods.

Volume-Based Garbage Fees State and local governments should adopt volume-based household waste collection systems and curbside recycling programs, with special provisions to avoid undue burdens on those with low incomes. The federal government will establish guidelines and models needed to initiate these programs.

Garbage Fees
Between 1960 and 1988, the volume of U.S. municipal solid waste more than doubled, while population multiplied 1.4 times. Today the average American produces 4.5 pounds of trash a day, by far the highest per capita production of municipal waste in the world. Americans could recycle or compost half this volume-yard waste, newspapers, corrugated cardboard, and beverage containers - Americans actually recycle or compost only 13 percent.

Municipal solid waste (residential and commercial waste, but not industrial, agricultural, or construction waste) makes up only three to four percent of the total U.S. waste stream, but it has an enormous impact on municipalities. Three-fourths of all municipal waste is landfilled, but space for, and political acceptability of, landfills grows ever scarcer. Household garbage is a familiar part of everyday life over which Americans have some control and through which they can gain environmental awareness.

Financing Garbage Collection
Many municipal garbage collection efforts are financed with flat fees or through property or other local taxes. This structure fails to alert consumers to the real costs of garbage and does not encourage them to reduce their wastes. Even where direct fees for trash collection exist, the fees may not rise with the volume of trash collected. These municipalities thus offer no financial incentive to the producers of household garbage to reduce the discardables they bring into their homes or businesses, to keep goods longer, or to recycle and compost.

A number of other municipalities, however, scale the charge for trash collection to the amount of waste generated-the more trash, the higher the fee. Some are able to finance recycling programs with the additional revenue.

World Resources Institute (WRI) analyzed the experience of 10 municipalities that introduced . volume-based collection fees between 1980 and 1989 and found that households readily accept such fee systems, that most cities reduced the amount of waste generated, that illegal dumping was rare, and that local governments increased revenue for financing recycling programs.

WRI analysts found that a municipality that raised the cost of collecting a 32-pound bag of garbage from $0.00 to $1.50 would see an 18 percent reduction in the volume of solid waste it had to landfill. If the town introduced a curbside recycling program simultaneously, volume fell by 30 percent. Net savings to the city (the avoided costs of handling waste minus additional costs to householders) reached 17 percent in areas where disposal costs were high (densely populated areas with scarce landfill space, where disposal costs exceeded $50 per ton). Moderate-cost areas ($20-$49 per ton) realized savings of six percent.

Volume-based garbage fees show that when choosing of appropriate environmental policies, environmental fees (an economic instrument) can be superior to regulation (command-and-control) in certain circumstances. Regulating the amount of each type of waste that each household can produce is unimaginable. Yet scaling the charge for garbage collection to the volume produced is an appropriate, powerful, and efficient approach.

The Population and Consumption Task Force recognizes that decisions about municipal solid waste collection are best made at the local level, and we are in no way recommending a federalized garbage collection system. However, we believe that the federal government can usefully enter into partnership with local communities and serve them by sharing experiences and lessons learned in a growing number of communities experimenting with volume-based garbage fees.

Disposal of Household Toxics State and local governments should adopt programs to curb the flow of toxic materials into municipal waste streams, focusing on incentives for recycling, deposit or buyback systems, procurement mandates, and finding substitutes for the most troublesome materials. This policy aims to minimize the contamination of waste that goes to landfills and incinerators, and of sewage, from the dumping of products, including the following: batteries containing lead and mercury; paints and solvents; motor oil; electrical appliances; and tires.

Household Toxics
The average American household throws away 15 pounds of hazardous waste annually (one percent of the household waste stream), including paints, solvents, motor oil, electrical appliances, tires, and batteries.

Batteries alone contain concentrated doses of heavy metals, such as lead, arsenic, zinc, cadmium, copper, and mercury. Each year, 180 million gallons of motor oil are improperly sent to landfills or poured down U.S. drains, an amount that equals 16 Exxon Valdez oil spills. These hazardous materials, by definition harmful to human health, can contaminate landfills, leach into groundwater, become toxic incinerator ash, vaporize into stack gases, or concentrate in sewage treatment plants. One-fifth of the toxic waste sites placed on the U.S. Environmental Protection Agency's priority list as national problems in 1989 are municipal landfills.

As with garbage in general, it makes sense to approach the control of household toxics with economic instruments. The most appropriate form appears to be a system similar to bottle deposit/return schemes, under which buyers would pay a deposit on hazardous materials that manufacturers would redeem return. Manufacturers would then recycle or dispose of the hazardous materials properly.


Efficient and Clean Technologies Civilian technology should be developed and promoted in partnership with the federal government to provide new ways to increase materials and energy efficiency and prevent pollution in the first place.

The Population and Consumption Task Force throughout its work and throughout this report has emphasized greater efficiency in the production of goods and services, in order to reduce the total environmental impact of human activities. The goal is to reduce the total amount of materials and energy used in producing what Americans consume. Achieving that efficiency depends to an enormous degree on technological innovations.

Analysts agree that three strategies are especially powerful for encouraging research, development and commercialization of technologies required for a transition to sustainability. All are included in Task Force proposals.

  • Prices should reflect true environmental costs, so that clean and efficient technologies face other technologies on a level playing field.
  • Government procurement of environmentally superior goods and services should increase in order to stimulate demand and create markets for environmental technologies.
  • Eco-labeling should become widespread in order to create markets for environmental technologies.
Thus, proposals elaborated elsewhere-the tax shift, subsidy elimination, government procurement, and eco-labeling-would also assist the development of environmental technologies.

Further encouragement for the development of environmental technologies might include funding of research, public-private partnerships for technology transfer, and research and development tax credits for industries. A complete examination of the full range of action required to stimulate the development and commercial availability of clean and efficient technologies lies beyond the scope of this Task Force's work, but we urge all parties interested in sustainability to address themselves to this critical issue.


Analysts have attempted to estimate the amount by which the absolute use of energy and materials would need to fall in the industrialized world for the world's environment to be sustained. For example, Germany's Ernst Ulrich von Weizsacker, President of the Wuppertal Institute, cites the estimate that the world's material flows should be halved, and that the industrialized countries should make a 90 percent reduction.

The Population and Consumption Task Force has not reached such quantitative conclusions. Enough is known about resource use in the United States and its environmental impact, however, to conclude that greater efficiency in the use of all resources is warranted, as a first step toward sustainable production and consumption of resources.

This conclusion calls for four steps to be taken now:

  • A thorough and open debate on environmental fees and charges, as part of a fundamental tax shift from savings to consumption;
  • Education programs to enable individual consumers to make wise choices regarding the purchase of products and the stewardship of their financial resources;
  • A move to address materials issues of particular importance-packaging, household garbage, and household toxics; and
  • Support for development of the technologies required to move the United States to sustainability.

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Population and Consumption

Population and Consumption: Endnotes


Executive Summary


Chapter 1

Chapter 2

Chapter 3

Chapter 4

Bibliographic Essay