Big Plastic Asks for $1 Billion Coronavirus Bailout

The companies seeking taxpayer dollars to fund recycling already have hundreds of billions at their disposal to pay for the processing of their products.

PORTLAND, ME - APRIL 10: A truck empties its load of recycling at ecomaine on Friday, April 10, 2020. (Staff photo by Derek Davis/Portland Press Herald via Getty Images)
A truck empties its load of recycling at ecomaine in Portland, Maine, on April 10, 2020. Photo: Derek Davis/Portland Press Herald/Getty Images

The plastic industry is asking Congress for $1 billion to bail out plastic recycling during the coronavirus crisis. “Recycling is an essential service and consumers are demanding products with more recycled content,” an alliance of industry groups that included Dow, the American Chemistry Council, Berry Global Group Inc., and the Plastics Industry Association wrote in an April 16 letter to House Speaker Nancy Pelosi and other House members. “In order to meet the demands of this crisis, we need investment now.”

The companies and industry trade groups seeking the money are calling themselves the Recover Coalition, a reference to the Recover Act, a bill introduced in the House in November that calls for allocating $500 million to recycling infrastructure over five years. In their letter, which was first reported in Plastics News, members of the coalition “implore” the House members to include the Recover bill “in any infrastructure package Congress considers either in response to the COVID-19 pandemic or separately” and to double the original funding request, noting that “We feel the time and need is right to seek a program of $1 billion.”

But others feel that the middle of a deadly pandemic, when millions of people don’t have enough money to pay rent and eat, is not the right time for the plastics industry to seek a government bailout. “Having multinational companies with their tin cups out asking for taxpayer dollars at this moment in time is wrong,” said Judith Enck, founder of the environmental group Beyond Plastics. “We need the federal spending to go to things like more testing, contact tracing, investments in clean energy — and not to attempts to prop up the feeble plastics recycling infrastructure.”

It’s worth noting that the companies now seeking additional taxpayer dollars to fund recycling already have hundreds of billions at their disposal to pay for the processing of the products they create. The 223 companies that belong to and fund the American Chemistry Council and the Recycling Partnership — both of which signed the letter — include 60 publicly held companies with a combined revenue of $2.7 trillion and net profit of $210 billion.

The American Chemistry Council is a trade group that represents some of the biggest plastic manufacturers in the world, including Dow Chemical, LyondellBasell, ExxonMobil Chemical Company, SABIC, BASF, Chevron Phillips Chemical Company, and Lanxess. The Recycling Partnership is an organization focused on recycling policy that is funded by trade groups and big brands. Just five of the beverage companies that support it — Coca-Cola, PepsiCo, Danone, Unilever, and Nestle — spent more than $24 billion on advertising alone in 2019.

In its letter, the coalition notes that the coronavirus crisis has led to a reduction in plastics recycling, as “many localities have reduced/eliminated recycling collection or suspended enforcement of bottle deposit laws, greatly reducing a much-needed manufacturing feedstock.” Yet, because recycled plastic generally costs more than “virgin” plastic, the demand for recycled plastic was already weak and declining long before the pandemic.

A downturn in plastic recycling could interfere with pledges made by Coca-Cola and other companies to include more recycled plastic in their packaging. But many big beverage companies, including Coke, have long opposed bottle bills that have been shown to dramatically increase recycling rates.

Asked whether the coronavirus crisis might make it harder to meet its commitments, Coke emailed a statement, saying,“While the pandemic will create temporary challenges, we remain focused on our goals. Through a partnership with our beverage industry, we took action in 2019 to create a $100 million fund, matched three to one by other grants and investors, to improve sorting, processing and collection of recyclables in U.S. communities with the biggest infrastructure gaps.”

As The Intercept has previously reported, the U.S. is in the midst of a recycling crisis and has never managed to recycle even 10 percent of its plastic. The rest is either burned, sent to landfills, or littered. While the Recover Act would address the problem by subsidizing the recycling process with government funds, another bill, the Break Free From Plastic Pollution Act, would instead put the financial onus for recycling back onto the companies that make and use plastic.

Sen. Tom Udall, who introduced the Break Free From Plastic Pollution Act in the Senate in February, has criticized the plastics industry for “relying on local taxpayers and beach-combing volunteers” to clean up the mess. Udall is similarly disdainful of the industry’s most recent attempt to get additional funding tied to the Covid-19 outbreak.

“By asking for a billion-dollar handout, Big Plastic is trying to maintain what already is the status quo: that is, taxpayers funding and taking responsibility for the waste of plastic producers,” Udall wrote to The Intercept in response to questions about the industry letter. “When we surface from this pandemic, plastic pollution will still be at crisis levels­ — and matters may be even worse, as industry tries to exploit this pandemic to leverage more marketing for single-use products.”

Udall was referring to recent attempts by the plastic industry to use the coronavirus crisis as a justification for rolling back bans on plastic bags and producing more single-use products. In March, the Plastics Industry Association wrote to the secretary of Health and Human Services, Alex Azar, asking him to “make a public statement on the health and safety benefits seen in single-use plastics.” The group also supplied its member companies with form letters requesting that their businesses that make single-use plastics, including packaging, be deemed essential.

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