Yes, there are government subsidies to various recycling institutions. In California, for example, the state provides millions of dollars in aid to recycling centers (see article). California seems to provide more subsidy than most other states, however. What is going on at the state level in California is certainly not representative of the country as a whole.
I don’t think that we would have a recycling program in the US if it weren’t for subsidies. Without them I don’t think that they could offer enough money to make the recycler think it was worth it.
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