If Penn and Teller were publishing a series of research papers instead of an entertainment program, and their conclusion wasn't foregone from the title of the series, then they might be a credible source for such information. As it stands, they've presented as fact the opinions of two dissident scientists who disagree with what is the scientific consensus: recycling has net positive effects on the environment.
See
National Recycling Week - Recycling Statistics and Research: Is Recycling Worth it? - Popular Mechanics for a readable analysis of the environmental impact of recycling.
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Across the board, the key factor is the energy intensity of extracting virgin materials, which is an order of magnitude higher than that of recovering the same material through recycling. “Even if you doubled the emissions from collecting recyclables, it wouldn’t come close,” Morris says. Overall, he found, it takes 10.4 million Btu to manufacture products from a ton of recyclables, compared to 23.3 million Btu for virgin materials. And all of the collecting, hauling and processing of those recyclables adds just 0.9 million Btu.
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Recycling paper reduces the amount of land needed for tree farms, which should free up space for old-growth forests. It saves landfill space, which admittedly isn't a precious commodity. Recycling promotes widespread public awareness of environmental issues, and recycling saves energy overall. So keep on recycling; you're saving the planet, even if you're not saving the government money.