Photo courtesy: Consulate of the People's Republic of China, Chicago

Parts 1 and 2 of this series examined China’s foreign exchange rate policy and how it contributes to the accumulation of structural imbalances, making the argument that it’s past time for China to graduate to a floating exchange rate currency management system and open up its domestic financial markets.

In this third, final installment, recent China-US trade and foreign exchange rate figures are examined in light of China’s fixed, or semi-fixed, rate currency management system, which pegs the value of the yuan to the US dollar. Also examined are arguments from economists and analysts who support and contend that China should continue to maintain its dollar peg.

Global Trade Imbalances – Still Growing

The growing and increasingly global economic imbalances and strains caused by China’s current policies are apparent in light of other recent US national accounting statistics. The US current account deficit – which totals trade in both goods and services - rose to $470.2 billion in 2010, while China’s 2010 current account surplus grew to $306.2 billion. The U.S. trade deficit with China in goods alone hit a record high of $273.1 billion.

If China maintained a floating rate foreign exchange system, that should have led the value of the yuan to increase against the value of the US dollar. While the yuan has indeed risen in value against the dollar, its appreciation has been ‘managed’ by the Chinese monetary authorities. Resisting repeated calls to move to a floating exchange rate system, China’s State Policy Committee in 2005 said it would enact a “managed float” that would result in a gradual appreciation of the yuan. Recent signs indicate that this policy has been rescinded in light of recent economic weakness, the result being that China’s now holding the line against further appreciation, however.

China’s currency did appreciate against the dollar – nearly 20% between 2005 and 2008, but economists contend that it’s still undervalued by as much as 40%. And it’s become evident to many economists that China shifted back to a fixed exchange rate policy to prevent its export markets from collapsing during the global financial crisis.

CFR article authors Roya Wolverson and associate staff writer Christopher Alessi note that the nonpartisan Congressional Research Service cited the sharp increase in China’s foreign exchange reserves from $403 billion to $1.5 trillion between 2003 and 2007, and a US trade surplus totaling $268 billion in 2007 as clear indicators of imbalances in global trade and misaligned foreign exchange rates. In addition was the 2010 increase, to around $3.2 trillion, in China’s foreign exchange reserves, though its trade surplus narrowed to a a mere $183.1 billion.

“Chinese authorities did not announce an official change in policy during this period. Instead, experts ‘infer it from the fact that the rate hasn’t moved,’” US Council of Foreign Relations’ (CFR) Adjunct Senior Fellow for International Economics Steven Dunaway was quoted as saying in an updated November 2011 article on CFR’s website.

Other economists and experts cite a number of reasons why China shifting to a floating exchange rate won’t do much to alter the chronic US trade and current account deficits. Stanford University professors Robert Staiger and Alan Sykes say that not only would it be very difficult to prove China manipulates its currency to the detriment of other economies in violation of WTO policy, they say that currency devaluation does not alter trade balances in the long run. If that were true, or at least believed to be true by Chinese monetary authorities, then currency devaluation would be a way for Chinese leaders to address international demands at little or no cost.

The CRF authors also cite a 2010 paper in which analysts Yuqing Xing and Neal Detert used the supply and value chain of Apple’s iPhone to illustrate how globalization “dilutes the relationship between exchange rates and US-China imbalances.” The paper’s authors point out that China is the last “assembly point” for a chain of iPhone components sourced from the US and other countries, yet the full value of exported iPhones is credited to China in trade statistics. Well and true enough, but at the end of the day, what still matters is the amount of foreign currency reserves being accumulated irrespective of accounting conventions. And that numbers continues to set new records.

A Multilateral Problem

Morgan Stanley Asia chairman Stephen S. Roach, they also note, says that America runs chronic trade and current account deficits with 87 other countries, some, including Saudi Arabia, that also peg their currencies to the US dollar. True enough, it is a multilateral problem, but China is the world’s second-largest economy with by far the largest trade surplus.

China has the resources and size to develop a healthier, much more balanced economy by focusing on stimulating domestic consumption and by opening up international investment opportunities to Chinese savers – companies and individuals. That would go a long way toward a re-balancing of worldwide flows in trade and investment.

Chinese leaders strive very hard to assure their place at the “adults” table in international assemblies and organizations. Their size, success and international aspirations should require that they play by the same rules as the “big boys” when it comes to foreign exchange, trade and investment as well.

Roach contends that it’s Americans’ chronically low rate of savings is the root of the problem. Again, true enough. That, combined with an expansionary US monetary policy and fiscal policy focused on debt-fueled consumption, are important factors in US trade and current account deficits. And that’s a problem that could, and should, be addressed by changes in tax and monetary, as well as private sector bank consumer lending policies.

While agreeing with these arguments, Chinese officials also point out the risks a yuan revaluation and floating exchange rate system would have – mainly a sharp slowdown in manufacturing and industry, concomitant drops in employment and heightened social instability. How well do these arguments hold up?

If Chinese authorities did allow the yuan to float and its value did rise against the dollar, the Chinese would have that much more international buying and investment power. Of course, the authorities would have to loosen or eliminate regulations to allow that to flow more freely both inwards and outwards, but that would support efforts to stimulate domestic demand and consumption.

And since so many US and European companies already manufacture so much in China, that demand could take up the slack created by a drop-off in Chinese exports. It would also increase imports, which would make the economy more balanced, but it may well not have as great an impact as many expect given that so many US manufacturers already source materials or have Chinese subsidiaries.

Adopting a strategic combination of interrelated, mutually supportive measures such as these would also stimulate domestic investment and realign foreign exchange rates and money and investment flows. Large parts of China lack adequate infrastructure and services. It could be a boon to many, many millions of Chinese, who in largest part, haven’t participated to any great degree in the two decades and still running economic boom times.

Global economic conditions over the past five years clearly indicate that fundamental changes are needed if some sort of balance in the global economic system is to be achieved. Given the tremendous growth China’s economy has experienced in the past two-plus decades, and the repercussions of its US dollar peg, transitioning to a floating rate currency system could serve both China and its trading partners worldwide well.

Foreign Exchange and China’s Central Bank

In contrast to its peers among the world’s largest economies – the European Union (EU), the USA and Japan – where central banks maintain at least some independence from politics, a political body, China’s State Council, establishes and controls China’s monetary and foreign exchange policy, not the People’s Bank of China, its central bank.

One key aspect of China’s current monetary and foreign exchange rate policy entails strictly controlling and limiting the availability and circulation of foreign currencies to and among Chinese businesses and individuals. To do this, it buys nearly all the dollars, as well as euros, yen, etc., that Chinese exporters earn and exchanges them for yuan, or rather Chinese treasury securities in most cases. Issuing government debt obligations as opposed to currency helps limit domestic inflation.

The success of this policy, along with the great strides made by Chinese industry and commerce, has made China the world’s largest holder of foreign currency (forex) reserves. As it doesn’t just want to let them sit idle, it invests them conservatively, which has led to China overtaking Japan as the largest holder of US Treasury securities.

As of August 2011, China held $1.14 trillion of its $3.26 trillion in foreign reserves in U.S. treasuries, according to the Xinhua, the government’s news agency. This figure has grown enormously in the past decade. In January 2001, China’s US Treasury securities holdings amounted to less than $100 billion.

That has helped keep US interest rates, particularly longer and medium term interest rates, lower than they otherwise should have been or are. Positive as that may be, it obscures the more fundamental distortions and negative effects of its foreign exchange rate policy, and the fact that China’s economy operates under fundamentally different rules than its peers among the world’s largest economies. Hard times in the US, Europe and Japan have made it more difficult for policymakers, politicians and the public in those countries to tacitly accept the situation and continue allowing China as much leeway as has been the case.

The Dollar Peg, Chinese Savings and Investment

While China’s foreign exchange rate and monetary policy has served the Chinese government and economy well, especially when it comes to the export sector and employment in export-driven industry and manufacturing, it does have substantial costs, both domestically and internationally. At the corporate, business and individual level, Chinese savers are narrowly constrained in terms of the options they have to invest their savings.

That’s funneled savings into strictly domestic real estate development and stock market investment and speculation. These have grown tremendously in the past decade, which has resulted in rapid asset price inflation.

These are essentially the same combination of factors that led to the implosion of Japan’s economy in the early 1990s. Though the details vary to a greater degree, they also parallel the conditions that led to rapid asset price inflation and more recent boom-bust cycles in the US and Europe. As Chinese authorities maintained their focus on reducing inflation in 2011, the mega-rich property developers began to feel the pain and question their earlier assumption that Chinese policymakers would relent on their inflation fighting promises sooner rather than later. That’s led to some steep drops in property prices.

Reports of large property developers in Shanghai and Beijing drastically cutting prices on their huge inventories of unsold apartments have surfaced. That’s led existing owners, who paid much higher prices, to revolt, in some cases violently. Real estate policy-driven revolts have also occurred in rural areas. It may also lead to positive feedback loop, as growing numbers of property buyers seek to sell their properties before the bottom falls out of the market. This would lead to a sort of deflationary real estate ‘death spiral’ of the type experienced in the US in 2008-2009 and Japan in the early 1990s.

The Dollar Peg and Mercantilism Redux, Chinese-style

China’s economic growth and development policy can be characterized as an updated, central government controlled and Chinese form of mercantilism, which the U.K. employed in the days of the British Empire. It comes with other costs.

Maintaining the Chinese yuan-US dollar foreign exchange rate means it must hold more currency reserves on hand to intervene in the market to hold the dollar peg. That money is potentially capital that could be invested. It also means using that money to invest in foreign, in this case US dollar assets, not only buying US treasuries but companies, real estate, stocks and corporate and other bonds.

One of the key benefits of a floating exchange rate system is that automatic stabilizers are built into it. If the Chinese yuan were allowed to float, i.e. if international forex market flows were allowed to determine its value, it’s most likely that it would take a lot more US dollars to purchase a given amount of yuan than is the case today.

If China employed a floating exchange rate system as opposed to its current fixed, or semi-fixed, rate system, the value of the yuan would likely appreciate. Chinese goods would become more expensive, making goods produced in the EU, US and Japan cheaper. That should result in adjustments in trade flows, barring other actions or policies that would make foreign goods more expensive in China.

Focused on developing export-driven industry and manufacturing, strictly controlling foreign investments and strictly constraining forex and investment flows has proven to be tremendously successful for China. It’s also come at significant costs and created significant problems, both domestically and internationally. It’s led to historic, and still growing, imbalances in international trade and associated tensions. China’s trade surplus with the US hit yet another record high in 2010.

Economically, as well as in other important respects, China cannot be considered an international lightweight. It’s now the world’s second largest economy, the world’s manufacturing powerhouse, and its largest polluter. Yet it continues to receive preferential treatment as a member of the World Trade Organization (WTO), primarily because of the size of its population and its only relatively recent emergence as a ‘market-based’ economy.

These two factors led foreign businesses to practically climb over one another to find Chinese partners, establish operations and gain a foothold in China, accepting terms that they would never accept from any smaller, resource-poor nation. Recent hard economic times at home and their experiences in China have led them to reconsider these values and attitudes.

(Note: This is the same John Boehner (R-Va.) and House Republican Tea Party members that want to eviscerate environmental protections, stymie and snuff out clean energy policy and incentives, cut back on infrastructure, education and social spending, refuse to roll back tax rates on corporations on the super-rich to pre-crisis levels, refuse to remove huge, longstanding subsidies for heavy polluting industries and want to pay for extending payroll tax cuts by cutting back on Medicare payments and other social services. Wow. They’ve got my vote.)

An important aspect of trade, monetary and overall economic policy, foreign exchange rate policy is an issue that’s best dealt with by governments and economic policy makers, ultimately China’s, rather than at the industrial and commercial level. As with any contentious issue, prominent macro economists and economic policy think tanks have come out arguing both in support of and against China’s foreign exchange rate policy.

The ‘Jekyll and Hyde’ Nature of US Economic Policy

Proponents of pushing China to drop its US dollar peg, such as former MIT, now Princeton University economist Paul Krugman, assert that it’s a key factor in US, as well as global, trade and economic imbalances that continue to build, one that works to the detriment of trade and productive investment. Those who support China’s policy, such as Xu Hongcai of the China Center for International Economic Exchanges, point to the benefits the availability cheap Chinese goods have had for the US economy, as well as the benefits it’s had in terms of Chinese economic growth, development and social stability. They lay most, if not all, of the blame for current US economic ills on domestic conditions and policies, particularly the easy monetary policy, lack of regulatory oversight and lax lending standards of US banks for creating successive asset bubbles and subsequent busts.

Elements of the arguments’ on both sides have their validity. China’s policy of fixing the foreign exchange value of the yuan to the US dollar certainly isn’t the only cause of the US’ current economic ills, or even the primary one. Since at least the 1990s, the US Federal Reserve has employed a strongly asymmetric monetary policy that fuels credit expansion in times of economic growth, floods the banking system with liquidity and holds down interest rates at the first sign of an economic slowdown or potential contraction.

This ‘pro-cyclical’ policy in times of credit expansion adds to the ‘natural’ tendencies and instability of markets for financial assets and property, as opposed to goods. Congressional actions compounded expansionary monetary policy, breaking down longstanding protective barriers between commercial and investment banking while allowing banks to add leverage their capital bases to a much greater degree. At the same time, they significantly weakened financial industry regulations and oversight.

In contrast, monetary and fiscal policies have been ‘counter-cyclical’ when the first signs of economic contraction are perceived. Successive financial crises – which pro-cyclical policies played a big part in creating in the first place – have led to increasingly large ‘rescue’ packages and stimulative monetary and fiscal policy responses.

The Efficient Markets Fallacy

A growing number of economists contend that this coupling of monetary and fiscal policies and actions have played the leading role and shaped the course for the US economy in the past decade. Not only that, it’s ideologically inconsistent. While standing aside and letting credit expansions run their course is an orthodox ‘laissez faire’ approach, stepping in to prevent contractions and possible deflation is a distinctly ‘Keynesian’ approach.

The ideological quagmire and ‘Jekyll and Hyde’ condition macro economists and the nation find themselves in can be traced back to implicit acceptance of the Efficient Markets Hypothesis. Cxcept in times of economic contraction, that is, when it becomes clear in a painful, politically unacceptable way that the theory does not reflect economic reality. But this is a topic for another post, one I hope to examine at another time. Let’s return to China’s foreign exchange rate policy.

That domestic US policies have played a major role in the country’s economic ills doesn’t negate the vastly increased impact China’s US dollar peg has come to have on the US economy. Its foreign exchange and foreign investment policies have and continue to be long-term structural factors that not only distort and destabilize capital allocation, trade, money and investment flows within and between the US and China, but across all the world’s trading nations. The arguments China used in defense of the US dollar peg in the early part of the new millennium weren’t completely valid at that time. They’re not completely valid now, and in today’s circumstances, they’re increasingly politically unacceptable. I’ll examine them in the next part of this three-part series.

Unilever, which has a presence in 100 countries throughout the world, is doing away with its CSR department calling it “redundant”. According to an article last week on Environmental Leader, the goal is to get rid of the department and integrate its practices throughout the company. This is an admirable move in that the company seems to understand the importance of working towards a social and financial benefit, while doing its part to cut down on its environmental impact. In fact, along with competitor, Procter and Gamble, Unilever has spent much of its time developing cheap sanitation products in order to address issues arising from overwhelming urban migration in developing countries. The company launched a “Sustainable Living Plan” in November 2010 in order to “help more than a billion people to improve their hygiene habits and bring safe drinking water to 500 million people by 2020.” An admirable goal to be certain. Whether they attempt this, as a loss leader in order to gain new customers amongst a growing middle class in these countries or are actually able to turn a profit will be interesting to see.

From a different sector, it was announced this past week that Reuters was doing away with its “Green Business” page. An announcement on the company blog had this to say:

“One of the goals of the sustainability movement is to integrate its objectives into all facets of business. In this light, Reuters.com is ahead of the game as we enter a time when solar panel companies are mainstream enough to be on the regular business page and not siphoned off to a private green niche.

Of course, green companies, technology and economies are not going away. At Reuters.com we embrace this opportunity to bring the business of the environment into the fold of the rest of the site, and welcome you to continue your dialogue with us as we branch out to yet another new chapter.”

Interestingly enough, during the same week, Bloomberg announced that it will be launching a sustainability page on its website. Meanwhile, the Guardian in the UK is one of the few (if not only) mainstream media outlets that has specific sections covering both international development issues and the world of social enterprise. However, Reuters is the first media company that I’m aware of to take this step towards integration.

Perhaps we are moving towards a new era of social and environmental stewardship amongst companies big and small. We are seeing the rise of interest in social enterprise amongst young people (look at how many MBA programs are now offering this type of focus) and it appears that some large companies are now integrating these initiatives into mainstream processes. It will be interesting to see where CSR 2.0 takes us.

Image Credit by Serena via Flickr under a CC license

Apparently, Americans aren’t getting the message that renewable energy is dead. Following the Solyndra bankruptcy and the avalanche of negative news coverage, 90 percent of the American public still thinks that developing sources of clean energy should be a very high (30%), high (35%) or medium (25%) priority for the president and Congress. This is from a survey released this week by the Center for Climate Change Communication (4C) at George Mason University.

It hasn’t been a good couple of months for government efforts to develop clean energy. The high profile failure of Solyndra precipitated significant negative coverage of renewable energy from the mainstream media. Even Google is giving up on it’s initiative to make renewable energy cheaper than coal.

But according to the 4C survey, all the negative news has had no impact on Americans’ belief that the president and Congress should give them cleaner sources of energy. The Solyndra scandal erupted in September and this survey was taken in late October and early November, when it would have been fresh in the public’s mind. But their support for clean energy is virtually unchanged since the same question was asked in May, when 91 percent felt that it should be a very high, high or medium priority.

Significant majorities supported government funding for renewable energy research (78%), tax rebates for efficient cars and solar (78%) and requiring utilities to produce 20% clean energy (63%).

Public support for clean energy is higher than global warming, but a majority wants the president and Congress to make global warming a priority (12% very high, 25% high and 33% a medium priority). The public also wants corporations and industry to do a lot more on global warming with 67% saying they should be doing more or much more to address global warming.

So, while policy makers and the press have spent much time over the past few months trying to determine what the future of government support should be for renewable energy, the public remains committed. They want the president and Congress to give them cleaner energy.

Two international advocacy organizations, Global Witness (based in the UK) and the Enough Project (based in the US) decided it was time to devote a great amount of their resources to the cause in attempt to influence policy makers, primarily in the US. Not only would this highly emotional issue resonate with donors, but the organizations also successfully found a way to get western consumers involved. This was done by discussing and addressing the involvement of conflict minerals, some of which end up in consumer electronics and the proceeds of which have, according to the organizations, been fueling the fighting.

Skip ahead to the amendment to Dodd-Frank, mainly a “financial reform” bill that forces companies to disclose where they source their minerals. This bill is a perfect example of addressing an extremely worthy cause from afar, without understanding the complexities of the situation and the negative externalities that come with creating a one-dimensional approach that is virtually impossible to implement in the current environment. It turns out, forcing companies to determine where the minerals they put in their products originated was far more expensive than was originally calculated when the Dodd-Frank rider was put together. In fact a recent study by Tulane University determined that the industry costs would be $7.93 billion, more than 100 times the $71.2 million the SEC believed it would cost initially. And what happens when businesses are faced with insurmountable costs levied upon them? They go elsewhere for business (or in this case resources). They can do this because these minerals, mainly columbite-tantalite (coltan), cassiterite, gold and wolframite, can be found elsewhere in the world and are much more important to the DRC economy than that of the bottom line of mining companies. Of course not all companies are doing this. Some including Motorola are attempting to comply.

Interestingly, this is, on the surface what the Enough Project, Global Witness and Dodd-Frank would like to accomplish, however we have a problem. Minerals are a huge industry thoughout an impoverished country like the DRC (not just in the east where the conflict takes place) and much of the mining that is done is done by legitimate means, by people who are attempting to make a living, not by those funding rebel (or DRC government) movements.

Now the last section concerning the impact on livelihoods is for the moment a very contentious debate and while the interest and subsequent action by western NGO’s and the US government is admirable, it’s still a great example of addressing a symptom rather than a cause. As a Congolese gentleman on a recent panel I attended said, conflict mineral legislation is not Congolese policy. Washington must work directly with Kinshasa to strengthen accountability throughout the mining sector (and the government in general) in order to end violent conflict and improve the livelihood of all Congolese – an absurdly complex and difficult, but incredibly necessary task.

Here are previous my reports on conflict minerals and Dodd-Frank.

Image Credit by unmas via Flickr under a CC license

A sustainable business considers the impacts of every facet of its operation and then attempts to address each, from paper consumption to human resources, in a way that does, ideally, no harm. Instead it supports the conservation of resources for infinite future use and enjoyment. A sustainable business plan affirmatively avoids “burning anything out”, from trees to human health, while it marches towards economic development.

The model of Sustainable [Economic] Development, what I have named “Sustonomy”, is a goal whose bar can be high but for which we make the reach anyhow, knowing that the planet we live on has reached its limit. Opportunities for Green businesses are myriad.

If you’re an entrepreneur moving in that direction, know that businesses with a focus on sustainability have a unique set of concerns. However, there are consultants who can help you, and you don’t need to start from scratch researching the fundamental components of a business. From production to administration to marketing, there are specialists who not only apply themselves with an unusual passion (they are often environmentalists at heart), they come with on-point educational credentials.

On the production front, Bryan Sheehan, M.S., one of the The Long View’s radio hosts, has considerable insights as evidenced by the content he brings to his monthly interviews. Jeffrey Everson, PhD  is another. Jeff specializes in renewable energy impassioned by what he researches about Peak Oil.

Find a Sustainability or Green Business consultant in your area. It’s likely you can bend her or his ear if your approach ventures to help reverse the environmental blows of the past while helping you build your financial security for the future.

 “Growth for the sake of growth is the philosophy of a cancer cell” said Edward Abbey.

In one of the most stunning keynote sessions I have attended over the past five Net Impact Conferences, Keen Healthcare CEO Vail Horton, who was born without legs or proper bone growth in his arms, closed yesterday morning’s “speed keynote” session to a thunderous standing ovation at the Portland Convention Center.

Horton told the more than 2,500 in attendance that his challenges had nothing to do with his physical birth defects, which in his words amounted to excuses or “handicrap.” Instead, Horton joked that his disabilities of consequence were rooted in his management style:  impatience, a controlling nature and a tendency to push his people and his kids too hard.

The story of Vail Horton captures the preservation, imagination and plain dogged pursuit of a better world that Net Impact is all about. He started Keen Healthcare at 23 when doctors told him the crutches he was using would lead to additional handicaps caused by carpal tunnel syndrome and other maladies related to their use. Horton decided that was unacceptable and there was market demand for healthcare products that added value and sustained mobility to the world’s disabled. He started Keen Healthcare with the objective of manufacturing world-class medical products focused on safety, mobility and comfort. Keen has been ranked within the top 50 companies on the Portland Business Journal  100 Fastest Growing Private Companies List for five consecutive years.

In addition to running a growing company and raising  a family of four children, Keen has also found time to raise $5 million with his Incight Foundation that provides education, employment, networking and independence opportunities for people with disabilities across the US.

Anyone short on optimism these days–President Obama, Occupy Wall Street–should consider the ethos of “handicrap” before they succumb to cynicism or complacency.

Earlier this month in my post “A Cynical Eye on Sprint’s ECO-mittment,” I got razzed a bit by a commenter about my ties to the printing and publishing industry. Do I have a bias towards paper and away from e-media? (I do, but not because I’m involved in the industry. It’s because I think e-media has a greater negative impact on the environment.)

I love comments like that, and frankly, if I couldn’t answer challenges from readers, I shouldn’t be writing for The Inspired Economist. But if you want another opinion, you’ll have your chance to poke the panel of experts during a discussion and debate over key issues related to paper production and sustainability next month in Belgium.

At the seminar, RISI, the European organization dedicated to information on the forest products industry, will be putting its panel out to the wolves for a discussion and debate. The event will be part of two half–day seminars at the Le Plaza hotel in Brussels, Belgium on November 15, 2011.

Panelists will include:

• Mark Rushton, RISI Seminar Chair, Editor, Pulp & Paper International (PPI), RISI
• Larry Tracy, Program Director, HP
• Martyn Eustace, Director, Two Sides and European Sustainability Manager and United Kingdom Country Manager, Print Power
• Jim Ford, Director, Climate for Ideas
• John Sanderson, Director, Environmental Market Support, UPM

The discussion will focus on these key issues:

• Identifying the challenges facing P&P producers to meet sustainability and environmental standards
• Ascertaining the obstacles and opportunities around recyclability of papers
• Understanding the business case for sustainable production and products
•  Expanding the reach of sustainability from production to printing and recycling/de-inking
• Where is the paper industry in terms of sustainability? What work has been done, and what needs to still be done?
•  How has the messaging around sustainability improved and what are the next steps needed?
• Is it more environmentally friendly to have certified paper from virgin pulp as opposed to recycled paper?
• Progress has been made, but what are we going to do next?

So got questions? Take them to RISI. This is quite a panel of experts, and I’m sure they’d love to field your rotten tomatoes  — I mean, respectful questions!

www.universalplastic.com

It almost happened again. I was in Kohl’s and purchased a handful of items — not enough to warrant packing them into a plastic shopping bag — so as the clerk reached below the counter, I stopped her and let her know that giving me a bag wasn’t necessary.

There it was, the startled, uncertain look of interrupted habit.  What should she do? Force me to take a bag because that is what she’s supposed to do? She was in process, after all. It’s hard to switch gears once you’re moving. Or stop mid-grab and respect my wishes as a landfill-conscious consumer?

To her credit, it was “cease and desist.” Some associates don’t get it. When I ask them not to put my items into a bag, to my horror they actually stuff the bag into the trash can. That can get really awkward. But to this woman’s credit, she put the bag back onto the packing handles.

But this interaction raises the question I’ve asked here before. What’s your policy toward shopping bags? Is your policy to have every customer’s purchased place into a bag automatically whether that purchase requires a bag or not? Or do you allow (or even encourage) the sales associates to ask customers if they want a bag in the first place?

I wonder if anyone has done a survey on the percentage of consumers who are given bags they don’t want? Or what percentage of consumers would accept (readily or reluctantly) not having a bag if given the option? I don’t know if anyone would pay for such a survey, but I for one would like to see the results.