What Actually Happens to Donated Clothes? - Recycling Is a Booming Business

For Adam Baruchowitz, every t-shirt tells a story—whether or not he wants to hear it.

"People want to explain to you every item, like 'this is the shirt I lost my virginity in,'" said the 41-year-old founder of Wearable Collections, a Brooklyn-based textile recycling company that retrieved more than 2 million pounds of synthetic rompers, snapback hats, and skinny jeans from New York dorm rooms, apartment buildings, and green markets last year. "People have really close association with their clothing. But when the cycle is done, we're going to help give it another life."

That new life, like the life of most clothes "donated" in the United States, bears little resemblance to its previous owner's, nor what its previous owner's imagines. Of the roughly 2 million tons of used clothing Americans recycle each year, less than half is ever worn again: 30 percent is cut up for use as industrial rags, and another 20 percent is shredded for couch stuffing and home insulation. Those clothes that continue as clothes — some 860,000 tons valued at nearly $700 million a year, according to the Department of Commerce — are next worn in Phnom Penh, Cambodia or Mombasa, Kenya.

All of which makes recyclers like Adam and his ilk a comfortable, if highly competitive living.

"They always get villainized every time people find out they make a profit from what they do," Elizabeth Cline, journalist and author of the fast-fashion expose Overdressed, told me."It's a funny little conundrum, because all recycling is for profit—as it should be. Otherwise, it probably wouldn't exist."

Unlike glass and aluminum recycling, which has only been in vogue for the past 40 years, the rag trade has been making American recyclers rich for more than a century. But a new crop of competitors—young upstarts like Adam and old-school scrappers like the Gromans of SpinGreen in Sheepshead Bay, along with quasi-legal operations like New Jersey's omnipresent Viltex—are stirring up the schmatta business in New York City, where it ranks among the most cut-throat and least regulated industries around.

"This is one of the dirtiest businesses I've ever seen," said recycler Eliot Groman, an ex-Soviet immigrant who sold the used cooking oil processing business he built with his wife Polina to get into the rag trade. "People set fire to the bins, they climb into the bins."

Other bins just vanish.

"A bin is an ATM; it's like a reverse ATM," Adam said. "There's are reasons people drop these bins all around. They can be lifted with forklifts. It's very territorial."

I asked Eliot which laws govern his year-old company and others like it. He scoffed.

"It's like the Wild West," he said. "There's only one law that basically says that you have to put [collection bins] on private property, and that's it."

Even that rule, Local Law 31, gets little respect. The City's Department of Sanitation was called to collect about 70 illegal bins since July 2012, and virtually none before that.

What makes the bins illegal is their wanton placement on public property, not their profit margins. But in New York, as in scores of municipalities across the country, the sudden realization that old clothes are being collected for industry rather than altruism is what has people up in arms.

"A lot of people aren't aware that textile recycling exists or that 95 percent of clothing and textiles can be recycled," said Jackie King, executive director of the Secondary Materials and Recycled Textiles association, which represents recyclers across North America and has recently begun fighting back against proposed bans. "A ban on for-profit bins, that doesn't help the situation from a collection standpoint for keeping this material out of the landfill."

Recycled textiles are still barely a drip compared to other consumer goods diverted from the waste stream: Americans recycle about 95 percent of batteries, 70 percent of newspapers and more than 50 percent of aluminum cans, yet, 85 percent of old clothes end up in the trash, a full 5 percent of the country's annual waste.

The reason, many say, is public perception.

"Americans go around operating under the assumption that there are still all these poor underdressed people in America who desperately need our castoff clothing," when in reality, "we are drowning in our own textile waste," Cline said. "It can't all possibly be reused here and it can't all continue on as clothing. People have to think about how much they're buying."

She said the industry itself is often complicit in the problem.

"These companies are private and they're very secretive," she said. "It's just this really old-school industry that doesn't have a lot of interaction with the public and it needs to be overhauled."

The rag-traders agreed.

"It's been a very underground market," Adam said. "They have these really strong operations going already, so they don't necessarily benefit from the higher profile of the industry."

Although he and others are upfront about their for-profit status, many would-be donors are aghast to learn still where their goods are really going.

"I'm not going into your closet and stealing your clothes," Adam said. "We never were a not-for-profit, but the perception of this world is that it's nonprofit, and you're always giving to nonprofits."

That argument elides the fact that established thrift-store charities like Goodwill and Salvation Army retail only a tiny fraction of the donations they collect, selling 80 percent "out the back door" to recyclers. The Department of Sanitation's nascent textile recycling program has diverted castoff clothes to the charity Housing Works, but the nonprofit relies on industrial for-profit recyclers to dispose of the excess.

"It's too expensive for them. The only way [municipalities like New York] can do it is for a private entity to do it," Eliot said. "We don't pretend to be a charity."

Like panty girdles and JNCO jeans, the donation model may simply have outlived its era.

"Disposable clothing is a reality," Cline said. "Why can't [collectors] just say, 'recycle your clothing here?'"

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