The PJ Tatler

Under a Green International Plan, the Price of US Wood and Paper Products Will Necessarily Skyrocket

Get ready to hold onto your wallets. If an international “green” plan goes forward, another US industry will lose out to international competition and the price that American consumers pay for items like paper, pencils and building materials could start rising. At issue: Whether the US Green Building Council will adopt a single standard for all forestry lands that is being pushed from overseas.

With North America accounting for 40 percent of the world’s certified lands, the US is a leader in forest certification — but there is some bad news. The US’ edge in responsible forestry management is being forced to the sidelines by government actions and environmental activists that are working to establish one international standard, FSC (Forest Stewardship Council), as the only legitimate standard in the US. Because over 90 percent of the world’s FSC-certified land is found in foreign countries, if the US adopts a monopoly standard, three-quarters of our nation’s certified lands could be excluded from the market. That exclusion could mean a significant reduction in domestic production, the loss of American jobs, and sending US dollars overseas.

The proper role for government and how it deals with forest certification lags behind the realities of the marketplace. A study released this week by The American Consumer Institute quantifies some of the costs of these government procurement policies have on businesses, consumers and the environment.

The study found several troubling consequences of this de facto monopoly that undermine the very sustainability goals of these certification programs. The study noted that the FSC program did not have consistent standards at all; instead they used benchmarks and requirements that differ from country to country. No surprise, under the FSC program, the US landowners face the strictest FSC standards in the world, while in more environmentally risky countries, such as Russia, landowners are allowed to game the system.

What does this mean for consumers? These added certification costs are passed on to US producers and ultimately American consumers of timber products in the price range of 15 percent to 20 percent. The study estimates that if an FSC standard becomes a controlling requirement for American forests, consumer welfare would drop by an estimated $10 billion for wood products and $24 billion for paper products each year.

Here’s the study.