The Portland Tribune's Steve Law reports that much of the recycled paper collected on the West Coast is being shipped to China.  The problem?  This raises the price of recycled paper higher than U.S. producers can afford.

Law says that a decade ago, the pulp and paper industry in the Portland, Oregon area provided 6,300 family-wage jobs. But that number has fallen to 3,500 jobs by early 2011.  Those remaining manufacturing jobs "support additional positions for suppliers, truck drivers and other workers."

Law says the the entire American paper industry is struggling, and the U.S. now "ships more and more recycled paper to China, which uses it to manufacture finished paper goods that are exported abroad."

A 2010 EPI study on China’s paper industry found that China tripled paper production in the past decade, becoming the world’s leading paper manufacturer. Law quotes the study's author Usha Haley as saying that China’s economic advantage in the paper industry is "due to massive government subsidies, not cheap labor."

“They get free land. They get free electricity. They get free saplings to plant in plantations. They get free water. They get loans that don’t have to be repaid,” says Haley, author of a for the Economic Policy Institute in Washington, D.C.

Haley found that China provided $33.1 billion in subsidies from 2002 to 2009 to propel its paper industry to become a major exporter. Not all the subsidies are easy to document, she says, so that figure understates the full amount.

Read Haley's full study.

Read the full article in the Portland Tribune.