5 ms·

The cost of drinks largely hasn't increased in line with inflation, so you'd very quickly arrive at an unsustainable situation where returning a can/bottle woul

The cost of drinks largely hasn't increased in line with inflation, so you'd very quickly arrive at an unsustainable situation where returning a can/bottle would give you more money than it cost you to buy it.

mschuster91 5y ago
Why is this unsustainable? You would still have to pay for the drink and deposit before you get the deposit back.
- dmurray 5y ago
  For one, it would increase the attractiveness of fraud where the same bottle is sold in multiple jurisdictions with different deposit rates. Instead of collecting trash across the border, buy cans there by the truckload, bring them back across state lines, empty them and redeem them for the "deposit" you never paid. Of course, there are some plausible technological or political solutions to this. But it does change the economics.
  - caslon 5y ago
    Isn't arbitrage like that just how markets are supposed to work? Still ends up with the cans redeemed and disposed, just goes about it in such a way that the maximum amount of value is extracted from them.
    - dmurray 5y ago
      No. This is almost the opposite of a market-based system. Aluminium cans are artificially made available only at tens or hundreds of times their cost to produce.
      - mschuster91 5y ago
        > Aluminium cans are artificially made available only at tens or hundreds of times their cost to produce. You forgot externalized costs... add the cost of cleaning up after irresponsible people leaving behind their cans wherever they want or the added costs and pollution of making a can from fresh aluminium ore (bauxite), and suddenly that "ten or hundred times" becomes "at cost". Deposits are a regulatory way to account for externalized costs, at least to a bit.
        throwaway0a5e 5y ago
        The deposit has nothing to do with the dirtiness of mining. It's so that people like you don't see a can blowing in the wind. If it were about the mining the deposit would be on everything else made of aluminum too. Of all the things to let into the environment aluminum is one of the least worst. As with everything else, it's yet another story about how narratives, marketing, knee jerk reactions and bike shedding are the name of the game when it comes to public policy.
  - mft_ 5y ago
    …which is easy enough to fix with bar codes. This is how it works in Germany. You pay a deposit on every bottle. To get your money back requires a machine to recognise each bottle/can as legitimate, based on the bar code. Now, yes, people could print stickers with fake bar codes on… but I don’t think that would work well at the scale of the major fraud operation you’re envisaging…
    - eru 5y ago
      And the German system is a bit silly, too. The Einwegpfand was supposed (I guess?) to make Einwegflaschen go away and promote Mehrwegflaschen. As far as I can tell, retail outlets just got good at crushing Einwegflaschen. An investment in capability that benefitted basically no one.
      - mschuster91 5y ago
        > An investment in capability that benefitted basically no one. There is a benefit: You rarely find plastic bottles and beer cans in the environment any more.
        lampe3 5y ago
        Really? I live in Hamburg, Germany. The amount of broken glass bottles is amazing... I lived in Hamburg for almost 30 years, but the city was never dirtier than it is right now.
        gambiting 5y ago
        I imagine the part of the problem is that once the bottle is broken, or the barcode is damaged, there is no incentive to return it anymore.
        csunbird 5y ago
        Same in Berlin, I had to replace my bike's tires more than once. Replying to sibling comment: The incentive is to not break the bottle, but return it instead.
  - markdown 5y ago
    > it would increase the attractiveness of fraud where the same bottle is sold in multiple jurisdictions with different deposit rates. Doesn't matter which way you slice it, it doesn't pay. The exception is if you can ship it on Mothers's Day.
midasuni 5y ago
If it had kept up with inflation a 45c bottle including 10c deposit in 1980 would be $1.52 including 33c deposit today Instead it’s about $2
- mbreese 5y ago
  The math a bit tougher than that. The volume of soda bottles is different now than in 1980. And most bottles aren’t glass, but plastic. Even the glass ones use different glass and cans use different amounts of aluminum. I agree that deposit values haven’t kept pace, but there are more variables at play.
  - schwartzworld 5y ago
    I doubt the volume of the soda bottle affects the cost to the manufacturer much. Soda prices are rarely linear to their size. At my local supermarket a 2-liter bottle from the aisle is typically cheaper than a 20oz from the fridge by the register.
    - mbreese 5y ago
      For plastic, you’re right. I think they use the same blanks for multiple sizes of bottles. For glass bottles, I’m not so sure. I don’t remember many plastic bottles in the 1980s. They were coming, but I still have glass in my head for all but 2L bottles at the time (but I was really young). But the point is the majority of bottles you’d see for recycling would have been glass (or cans) at that time. And the amount of materials used for packaging was different back then.
gnicholas 5y ago
It can never give you more than it cost — the redemption value gets added to the cost of the beverage. So a $1 bottle of Coke would cost $1.05 if the redemption value were 5¢ And it would cost $1.50 if the redemption value were 50¢. The reason the redemption value has not gone up much is that people would balk at paying so much for the goods upfront, IMO. Adding 20¢ per can would add nearly $5 to the cost of a 24-pack or soda. The cost per ounce of soda drops dramatically when you buy in volume, so the redemption value would grow to be a substantial portion of the total cost for larger purchases.
- kwhitefoot 5y ago
  They would soon get used to it. People are hardly going to give up drinking sugary soft drinks because of high deposit values. They might be reluctant but if there is no other way to get that sugary hit they will do it and eventually it will be just how things are done.
  - gnicholas 5y ago
    You're right that they won't give up drinking soda! But the experience of Philadelphia, [1] which imposed a per-ounce soda tax (later repealed) shows us that these tend to drive consumers to other jurisdictions (NJ) to buy groceries. This means Philadelphia lost out not only on soda sales, but also on other groceries purchased at the same time. Another issue that arises is that people will actually transport recyclables across state lines to arbitrage the differences in redemption value. [2] This only happens if there are large enough disparities, but in the US this is almost certain to happen due to the different policy choices made by nearby states. 1: https://anderson-review.ucla.edu/wp-content/uploads/2021/03/Seiler-et-al_SodaTaxes2020_SSRN-id3302335.pdf https://anderson-review.ucla.edu/wp-content/uploads/2021/03/... 2: https://www.recyclingtoday.com/article/arrests-in-16-million-recycling-fraud-case/ https://www.recyclingtoday.com/article/arrests-in-16-million...
    - gambiting 5y ago
      The thing I don't get about US though......people keep pointing out that US States are as big if not bigger than most European countries - and over there companies somehow manage to create completely unique packaging for every country, distribute their product and keep stock of what's where. Why not in the US? If this sort of thing is enough of an issue, why not make sure that each state gets different barcode, or slightly different label or whatever, to make sure the bottles are not returnable between state lines? Germany pays a lot more for cans and bottles than Poland does, but you can't return Polish bottles and cans in German stores because the barcodes and labels are different - you can cross the border without any issue, but there is no way to exploit the economic imbalance in recyclables returns.

mschuster91 5y ago

Why is this unsustainable? You would still have to pay for the drink and deposit before you get the deposit back.

dmurray 5y ago
For one, it would increase the attractiveness of fraud where the same bottle is sold in multiple jurisdictions with different deposit rates. Instead of collecting trash across the border, buy cans there by the truckload, bring them back across state lines, empty them and redeem them for the "deposit" you never paid. Of course, there are some plausible technological or political solutions to this. But it does change the economics.
- caslon 5y ago
  Isn't arbitrage like that just how markets are supposed to work? Still ends up with the cans redeemed and disposed, just goes about it in such a way that the maximum amount of value is extracted from them.
  - dmurray 5y ago
    No. This is almost the opposite of a market-based system. Aluminium cans are artificially made available only at tens or hundreds of times their cost to produce.
    - mschuster91 5y ago
      > Aluminium cans are artificially made available only at tens or hundreds of times their cost to produce. You forgot externalized costs... add the cost of cleaning up after irresponsible people leaving behind their cans wherever they want or the added costs and pollution of making a can from fresh aluminium ore (bauxite), and suddenly that "ten or hundred times" becomes "at cost". Deposits are a regulatory way to account for externalized costs, at least to a bit.
      - throwaway0a5e 5y ago
        The deposit has nothing to do with the dirtiness of mining. It's so that people like you don't see a can blowing in the wind. If it were about the mining the deposit would be on everything else made of aluminum too. Of all the things to let into the environment aluminum is one of the least worst. As with everything else, it's yet another story about how narratives, marketing, knee jerk reactions and bike shedding are the name of the game when it comes to public policy.
- mft_ 5y ago
  …which is easy enough to fix with bar codes. This is how it works in Germany. You pay a deposit on every bottle. To get your money back requires a machine to recognise each bottle/can as legitimate, based on the bar code. Now, yes, people could print stickers with fake bar codes on… but I don’t think that would work well at the scale of the major fraud operation you’re envisaging…
  - eru 5y ago
    And the German system is a bit silly, too. The Einwegpfand was supposed (I guess?) to make Einwegflaschen go away and promote Mehrwegflaschen. As far as I can tell, retail outlets just got good at crushing Einwegflaschen. An investment in capability that benefitted basically no one.
    - mschuster91 5y ago
      > An investment in capability that benefitted basically no one. There is a benefit: You rarely find plastic bottles and beer cans in the environment any more.
      - lampe3 5y ago
        Really? I live in Hamburg, Germany. The amount of broken glass bottles is amazing... I lived in Hamburg for almost 30 years, but the city was never dirtier than it is right now.
        gambiting 5y ago
        I imagine the part of the problem is that once the bottle is broken, or the barcode is damaged, there is no incentive to return it anymore.
        csunbird 5y ago
        Same in Berlin, I had to replace my bike's tires more than once. Replying to sibling comment: The incentive is to not break the bottle, but return it instead.
- markdown 5y ago
  > it would increase the attractiveness of fraud where the same bottle is sold in multiple jurisdictions with different deposit rates. Doesn't matter which way you slice it, it doesn't pay. The exception is if you can ship it on Mothers's Day.

midasuni 5y ago

If it had kept up with inflation a 45c bottle including 10c deposit in 1980 would be $1.52 including 33c deposit today Instead it’s about $2

mbreese 5y ago
The math a bit tougher than that. The volume of soda bottles is different now than in 1980. And most bottles aren’t glass, but plastic. Even the glass ones use different glass and cans use different amounts of aluminum. I agree that deposit values haven’t kept pace, but there are more variables at play.
- schwartzworld 5y ago
  I doubt the volume of the soda bottle affects the cost to the manufacturer much. Soda prices are rarely linear to their size. At my local supermarket a 2-liter bottle from the aisle is typically cheaper than a 20oz from the fridge by the register.
  - mbreese 5y ago
    For plastic, you’re right. I think they use the same blanks for multiple sizes of bottles. For glass bottles, I’m not so sure. I don’t remember many plastic bottles in the 1980s. They were coming, but I still have glass in my head for all but 2L bottles at the time (but I was really young). But the point is the majority of bottles you’d see for recycling would have been glass (or cans) at that time. And the amount of materials used for packaging was different back then.

gnicholas 5y ago

It can never give you more than it cost — the redemption value gets added to the cost of the beverage. So a $1 bottle of Coke would cost $1.05 if the redemption value were 5¢ And it would cost $1.50 if the redemption value were 50¢. The reason the redemption value has not gone up much is that people would balk at paying so much for the goods upfront, IMO. Adding 20¢ per can would add nearly $5 to the cost of a 24-pack or soda. The cost per ounce of soda drops dramatically when you buy in volume, so the redemption value would grow to be a substantial portion of the total cost for larger purchases.

kwhitefoot 5y ago
They would soon get used to it. People are hardly going to give up drinking sugary soft drinks because of high deposit values. They might be reluctant but if there is no other way to get that sugary hit they will do it and eventually it will be just how things are done.
- gnicholas 5y ago
  You're right that they won't give up drinking soda! But the experience of Philadelphia, [1] which imposed a per-ounce soda tax (later repealed) shows us that these tend to drive consumers to other jurisdictions (NJ) to buy groceries. This means Philadelphia lost out not only on soda sales, but also on other groceries purchased at the same time. Another issue that arises is that people will actually transport recyclables across state lines to arbitrage the differences in redemption value. [2] This only happens if there are large enough disparities, but in the US this is almost certain to happen due to the different policy choices made by nearby states. 1: https://anderson-review.ucla.edu/wp-content/uploads/2021/03/Seiler-et-al_SodaTaxes2020_SSRN-id3302335.pdf https://anderson-review.ucla.edu/wp-content/uploads/2021/03/... 2: https://www.recyclingtoday.com/article/arrests-in-16-million-recycling-fraud-case/ https://www.recyclingtoday.com/article/arrests-in-16-million...
  - gambiting 5y ago
    The thing I don't get about US though......people keep pointing out that US States are as big if not bigger than most European countries - and over there companies somehow manage to create completely unique packaging for every country, distribute their product and keep stock of what's where. Why not in the US? If this sort of thing is enough of an issue, why not make sure that each state gets different barcode, or slightly different label or whatever, to make sure the bottles are not returnable between state lines? Germany pays a lot more for cans and bottles than Poland does, but you can't return Polish bottles and cans in German stores because the barcodes and labels are different - you can cross the border without any issue, but there is no way to exploit the economic imbalance in recyclables returns.