For Clients & Friends of The Gualco Group, Inc.
IN THIS ISSUE – “Sharpening Their Knives…”
‘TIS THE SEASON…
CAPITAL DATA MATTERS
- California Leaders Contemplate Recession Preparations
- Birth Rate Decline Continues
- Legislatures Refuses to Release Future Sexual Harassment Data
DISASTERS, WATER WARS & TECH VILLAINS
- State Auditor Faults Disaster Preparedness
- Climate Change Cascade Predicted…Soon
- Silicon Valley’s Eccentric Uncle Takes on Tech’s “Authoritarian” Billionaires
FOR THE WEEK ENDING DEC. 6, 2019
Capital News & Notes (CN&N) harvests California legislative and regulatory insights from dozens of media and official sources for the past week, tailored to your business and advocacy interests. Please feel free to forward.
READ ALL ABOUT IT!!
NOTE: The Gualco Group, Inc. is co-founder and convener of the California Food Waste Roundtable, a pro bono group of ag, foodmaker, restaurant, government, nonprofit and academic senior executives who gather to support food waste reduction and feeding hungry people.
National Public Radio
As the season of big holiday meals kicks off, it’s as good a time as any to reflect on just how much food goes to waste.
If you piled up all the food that’s not eaten over the course of a year in the U.S., it would be enough to fill a skyscraper in Chicago about 44 times, according to an estimate from the U.S. Department of Agriculture.
And, when all this food rots in a landfill, it emits methane, a powerful greenhouse gas that contributes to climate change. In fact, a recent report from the United Nations from a panel of climate experts estimates that up to 10 percent of all human-made greenhouse gas emissions are linked to food waste.
So, here’s one solution to the problem: Dairy farmers in Massachusetts are using food waste to create electricity. They feed waste into anaerobic digesters, built and operated by Vanguard Renewables, which capture the methane emissions and make renewable energy.
The process begins by gathering wasted food from around the state, including from many Whole Foods locations. We visited the chain’s store in Shrewsbury, Mass., which has installed a Grind2Energy system. It’s an industrial-strength grinder that gobbles up all the scraps of food the store can’t sell, explains Karen Franczyk, who is the sustainability program manager for Whole Foods’ North Atlantic region.
The machine will grind up all kinds of food waste — “everything from bones, we put whole fish in here, to vegetables to dry items like rice or grains,” Franczyk says as the grinder is loaded. It also takes frying fats and greases.
While Whole Foods donates a lot of surplus food to food banks, there’s a lot waste left over. Much of it is generated from prepping prepared foods. Just as when you cook in your own kitchen, there are lots of bits that remain, such as onion or carrot peel, rinds, stalks or meat scraps. The grinder turns all these bits into a slurry. “It really becomes kind of a liquefied food waste,” Franczyk says.
From here, the waste is loaded into a truck and sent to an anaerobic digester. “There’s no question it’s better than putting it in the trash,” Franczyk says. She says the chain is committed to diverting as much waste as possible and aims for zero waste. In addition to food donations, Whole Foods composts; this waste-to-energy system is yet another way to meet its goal. “We really do like the system,” she says.
We visited Bar-Way Farm, Inc. in Deerfield, Mass. Owner Peter Melnik, a fourth-generation dairy farmer, showed us how his anaerobic digester, which is installed next to his dairy barn, works.
“We presently take in about a 100 tons [of waste], which is about three tractor-trailer loads, every day,” Melnik says.
In addition to all the food waste from Whole Foods, he gets whey from a Cabot Creamery in the area, as well as waste from a local brewery and a juice plant.
In the digester, he combines all of this waste with manure from his cows. The mixture cooks at about 105 degrees Fahrenheit. As the methane is released, it rises to the top of a large red tank with a black bubble-shaped dome.
“We capture the gas in that bubble. Then we suck it into a big motor,” Melnik explains. Unlike other engines that run on diesel or gasoline, this engine runs on methane.
“This turns a big generator, which is creating one megawatt of electricity” continuously, Melnik says — enough to power more than just his farm. “We only use about 10 percent of what we make, and the rest is fed onto the [electricity] grid,” Melnik explains. It’s enough to power about 1,500 homes.
He says times are tough for dairy farmers, so this gives him a new stream of revenue. Vanguard pays him rental fees for having the anaerobic digester on his farm. In addition, he’s able to use the liquids left over from the process as fertilizer on his fields.
“The digester has been a home run for us,” Melnik says. “It’s made us more sustainable — environmentally [and] also economically.”
Vanguard Renewables hopes to expand its operations in the state and elsewhere. “There’s more than enough food waste in Massachusetts to feed all of our five digesters, plus many more,” says CEO John Hanselman.
Massachusetts has a state law that prohibits the disposal of commercial organic waste — including food — by businesses and institutions that generate at least one ton of this waste per week. This has created an incentive for food businesses to participate in the waste-to-energy initiative.
Hanselman points to Europe, where there are thousands of digesters in operation. His hope is that the concept will spread here. “The food waste recycling through anaerobic digestion could be done in every part of the country,” Hanselman says.
The company is currently building an anaerobic digester on a farm in Vermont. The gas produced there will be piped to Middlebury College, which will help the college reduce its carbon footprint.
Public Policy Institute of California
“Sometime — and according to many forecasters, sometime soon — the nation and the state will go through a recession.”
Not the cheeriest of financial analyses for the Golden State, but it’s one that the Public Policy Institute of California laid out in a new report peeking into the next economic downturn and how it could affect the state’s “safety net” programs.
But the more grim perspective contrasts with what the institute described as California’s current “unusually bright” economy with “historically high levels” of fiscal prosperity and low unemployment rates. That sets California up for a better defense when the state experiences a negative turn in finances.
In its report, the institute reflected on the Great Recession and how lessons learned from that painful period can help inform California lawmakers during the financial slowdown.
- According to the institute, the rate of poor Californians during the Great Recession grew from 12.2 percent to 16.6 percent.
- The state also slashed $1.9 billion in funding from 2008 to 2012 from large safety net programs.
- Despite an uptick in revenue following the recession’s turnaround, poverty rates for years afterward “remained elevated,” the authors wrote, underscoring a need to plan ahead for the greater economic cycle rather than the immediate outlook.
- Between 500,000 and 1.2 million more Californians are likely to dip into poverty during a recession.
- EnsuringMedi-Cal, which now covers a greater number of people than during the last economic downturn, stays viable and maintains its “critical role” will be tough.
- One important “unknown?” It’s unclear, given the political climate, whether California will have a friend or foe in the White House during the next recession, and whether its residents can expect any federal assistance should they find their wallets a bit emptier than their pocketbooks of today.
- Because health and social services “account for nearly half of all expenditures,” they’re also more likely to be on the chopping block. That means Medi-Cal,CalWORKs, Supplemental Security Income and State Supplementary Payment and CalEITC, what the institute described as valuable programs, will have to be monitored and their access protected during the next recession.
If the economic fortunetelling seems a bit grim, the institute leaves readers on a positive note: “California has one tool in its kitbag that was not there a decade ago,” the authors concluded. “More than $20 billion in reserves set aside to provide a cushion in a budget crisis.”
Birth Rate Decline Continues
CalMatters, no link
Mirroring and perhaps leading a national trend, births in California continued to decline in 2018, according to data released by the Centers for Disease Control and Prevention.
California’s 454,920 births represented a 3.5% decline from 2017 and were spread across all ethnic groups. The nation’s 3.79 million births represented a 1.6% decline from a year earlier.
- 502,879births in 2014
- 531,959in 2000
- 612,628in 1990
Teen mothers: California’s rate of 13.6 births per 1, 000 girls 15-19 was far below the national average of 17.4 in 2018. Ten states, nine of which are in the South, had teen birth rates greater than 25 per 1,000.
Older mothers: California’s rate of 63.8 births per 1,000 women ages 35-39 was fifth highest in the nation. California’s rate of 17.3 births per 1,000 women 40-44 was second highest after Washington, D.C., and New York.
- Hispanics accountedfor 211,271 births, 46.4% of California’s total, and 23.8% of the nation’s total. Texas was second with 179,142, or 47% of its total.
- White parentsaccounted for 123,139 births, 27%.
- Parents of Asian descentaccounted for 68,444, 15% of California’s total and 28.4% of the nation’s Asian total. New York was second with 24,383.
- Black parentsaccounted for 22,380 births, 4.9% of California’s total. Texas’ 48,144 births to African-American parents led the nation.
National Public Radio
The California Legislature spent nearly $2 million last year investigating sexual harassment accusations involving lawmakers, staffers and lobbyists, and received 15 new allegations — including four against state senators and two separate complaints against an Assembly member.
This newly released data, obtained by CapRadio as part of a Legislative Open Records Act request, is from 2018 and the first month of 2019. The response includes no names, which is consistent with the same data released in the past.
But CapRadio’s request for data on all allegations made since January has so far been denied.
That means these newly released details about sexual harassment at the state Capitol will be the last ones the public ever sees — unless the Legislature chooses to disclose information from its newly formed, joint Senate-Assembly Workplace Conduct Unit.
The Senate and Assembly had previously released data on sexual harassment accusations in February 2018, which covered the years 2006 through 2017. CapRadio also sought that data for all allegations made since the Workplace Conduct Unit’s inception in February.
Since the Legislature is declining to release any information about the WCU, “it’s kind of a black box right now,” said Samantha Corbin, a Sacramento lobbyist who helped mobilize women as part of the Me Too movement in 2017 and currently serves as executive director for the advocacy group We Said Enough. “We’re not really sure if in fact it’s working, or how it’s working.”
Mike Letizia, who runs a Stockton-based human-resources consulting firm and leads training courses on behalf of the California chapter of the Society for Human Resource Management, said the Legislature will “absolutely” need to report data on allegations in a “reasonable amount of time.”
“And I would think that a reasonable amount of time be within a 12 month period,” he said, “so that we understand how those efforts are succeeding or not succeeding.”
Letizia added that the Legislature will want to review the data, too, to evaluate whether their initiatives are having an impact. If they’re not, it might be time for “some different approaches.”
“The only way we can tell whether something is successful or not is measuring the results,” he told CapRadio after reviewing the Legislature’s responses to the records requests. “If we don’t ever find out results, then it’s an empty process.”
The title of the California State Auditor’s latest report sums up the finding, one Californians have come to know all too well: “California is not adequately prepared to protect its most vulnerable residents from natural disasters.”
- 25%of the state’s population lives in areas of high wildfire risk.
- 20%of the state’s population are either older or living with a disability.
The auditor called out three counties, Butte, Sonoma and Ventura, as being especially ill-prepared to alert, evacuate or shelter residents.
The Governor’s Office of Emergency Services “has not adequately supported cities and counties in planning to protect vulnerable populations during natural disasters,” the report says.
Some of the most alarming science surrounding climate change is the discovery that it may not happen incrementally — as a steadily rising line on a graph — but in a series of lurches as various “tipping points” are passed. And now comes a new concern: These tipping points can form a cascade, with each one triggering others, creating an irreversible shift to a hotter world. A new study suggests that changes to ocean circulation could be the driver of such a cascade.
A group of researchers, led by Tim Lenton at Exeter University, England, first warned in a landmark paper 11 years ago about the risk of climate tipping points. Back then, they thought the dangers would only arise when global warming exceeded 5 degrees Celsius (9 degrees Fahrenheit) above pre-industrial levels. But last week, Lenton and six co-authors argued in the journal Nature that the risks are now much more likely and much more imminent. Some tipping points, they said, may already have been breached at the current 1 degree C of warming.
The new warning is much starker than the forecasts of the Intergovernmental Panel on Climate Change, which critics say has until now played down the risks of exceeding climate tipping points, in part because they are difficult to quantify.
The potential tipping points come in three forms: runaway loss of ice sheets that accelerate sea level rise; forests and other natural carbon stores such as permafrost releasing those stores into the atmosphere as carbon dioxide (CO2), accelerating warming; and the disabling of the ocean circulation system.
The New Yorker
Roger McNamee started his career in 1982, as a twenty-six-year-old analyst at the investment firm T. Rowe Price. The personal-computer revolution was just beginning. He invested in Electronic Arts (now a leading video-game maker) and Sybase (a pioneering database firm), among others, eventually running one of the most successful funds in the industry. In 1991, he partnered with the venture-capital firm Kleiner Perkins, where he listened to pitches for Netscape and Amazon. He invested in those companies, too, and a few years later he co-founded Silver Lake Partners. The businesses in Silver Lake’s portfolio now produce two hundred and thirty billion dollars in annual revenue and employ three hundred and seventy thousand people. In the early two-thousands, McNamee helped create a private-equity firm, Elevation Partners, which invested two hundred and ten million dollars in Facebook in 2009 and 2010, two years before it went public.
If the founders of Big Tech were a family, McNamee might be its eccentric uncle. A longtime guitarist who still plays some fifty shows a year, he has toured for more than two decades with an evolving cast of venture capitalists, technologists, and career musicians such as Pete Sears, of Jefferson Starship. On tracks like the stoner anthem “It’s 4:20 Somewhere,” by his band Moonalice, McNamee performed under the stage name Chubby Wombat.
McNamee has mentored many of the people who have transformed Silicon Valley. In 2006, when Facebook was a two-year-old company with less than fifty million dollars in annual revenue, McNamee advised Mark Zuckerberg to turn down Yahoo’s offer to buy it for a billion dollars. (It’s now worth more than five hundred billion.) Not long afterward, he encouraged Zuckerberg to hire Sheryl Sandberg. His acquaintances have included Steve Jobs and Bill Gates, who was an investor at Silver Lake.
McNamee saw the tech industry as an experiment in creative and profitable problem-solving. He grew unnerved by its ethical failures only in 2012, when Uber came to him for investment capital. He decided that Silicon Valley had changed. “These guys all wanted to be monopolists,” he said recently. “They all want to be billionaires.”
McNamee was convinced that Facebook was different. Then, in February, 2016, shortly after he retired from full-time investing, he noticed posts in his Facebook feed that purported to support Bernie Sanders but struck him as fishy. That spring, the social-media-fuelled vitriol of the Brexit campaign seemed like further proof that Facebook was being exploited to sow division among voters—and that company executives had turned a blind eye. The more McNamee listened to Silicon Valley critics, the more alarmed he became: he learned that Facebook allowed facial-recognition software to identify users without their consent, and let advertisers discriminate against viewers. (Real-estate companies, for example, could exclude people of certain races from seeing their ads.)
Ten days before the Presidential election, McNamee sent an e-mail to Zuckerberg and Sandberg. “I am disappointed. I am embarrassed. I am ashamed,” he wrote.
Recently, Facebook has done some things that are truly horrible and I can no longer excuse its behavior. . . . Facebook is enabling people to do harm. It has the power to stop the harm. What it currently lacks is an incentive to do so.
Within hours, both Zuckerberg and Sandberg sent McNamee cordial replies, assuring him that they were already working to address some of the issues he’d raised, and dispatched a Facebook executive, Dan Rose, to talk to him. Rose told McNamee that Facebook was a platform, not a publisher, and couldn’t control all user behavior. Since leaving the investment world, McNamee had been looking forward to being a full-time musician.
But Rose’s dismissiveness rattled him. “They were my friends. I wanted to give them a chance to do the right thing. I wasn’t expecting them to go, ‘Oh, my God, stop everything,’ but I was expecting them to take it seriously,” he said. “It was obvious they thought it was a P.R. problem, not a business problem, and they thought the P.R. problem was me.” McNamee hasn’t spoken to Sandberg or Zuckerberg since. (Both declined to comment for this article.) He now refers to Zuckerberg as an “authoritarian.”
As Russian election interference became increasingly apparent, McNamee published a series of op-eds—in the Guardian, USA Today, Time, and elsewhere—arguing that the social-media business model thrived on divisive rhetoric: the more extreme the content, the more users shared it; the more the algorithms amplified it, the more ad revenue was generated. McNamee also scheduled meetings with policymakers, investors, and Silicon Valley executives. He and Nancy Pelosi, now the Speaker of the House, had been introduced some twenty years earlier, by the Grateful Dead drummer Mickey Hart, and McNamee set out to expand his network of Washington contacts. As lawmakers prepared for hearings about Russian meddling, in the fall of 2017, McNamee put together a curriculum for them, which he jokingly called “Internet Platforms 101.” Adam Schiff, a member of the House Intelligence Committee, had been focused on foreign manipulation of social media, but, in a meeting, McNamee urged him to consider a broader problem—how the platforms were sowing discord among Americans. “Roger was really ahead of the curve,” Schiff said. “Time has borne out his warnings.”
McNamee is not a kombucha kind of Californian. He ordered a Diet Coke with his eggs and toast. As we ate, conversation veered from the civil-rights movement, which he says inspired his tech activism, to the number of Grateful Dead shows he attended before Jerry Garcia died (two hundred). Describing the arc of his career, McNamee attributed his business success mainly to “dumb luck.” Talk turned to Bono, whom he met through Sandberg in 2001, and with whom he co-founded Elevation Partners. “Bono said to me, more than once, ‘Your superpower is you’re not motivated by money,’ ” McNamee told me. “That’s the only reason I could do this.”
McNamee’s zeal for diagnosing problems soon evolved into a mission to devise a solution. He argued that piecemeal regulation would never get to the root of the problem: mining users’ private data for profit. In February, 2019, McNamee published “Zucked: Waking Up to the Facebook Catastrophe”—part memoir, part manifesto. He then embarked on a book tour that has turned into an ongoing public-shaming campaign. He has taken his message to bookstores, breweries, high-school gymnasiums, and college campuses. He estimates that he’s made his pitch to more than three hundred audiences in the past year. “I have a hippie value system,” McNamee told me recently. “I’m always going to speak truth to power.”
McNamee is not the first Silicon Valley insider to become a critic of the tech industry, but he may be the most strenuous. Kara Swisher, a co-founder of the tech-news site Recode and a New York Times columnist, recalled, “Whenever I would say negative things about Facebook, I’d always get a text or a call from Roger.” Now, she continued, McNamee is “sort of shunned” in the Valley. Last winter, Bill Gates told Forbes, “I think what Roger has said is completely unfair and kind of outrageous. They’re blaming Mark for everything.” Swisher thinks the Valley has been eager to portray McNamee as “off the rails.” As she sees it, “He’s a little wacky, but he’s not crazy. The more they make fun of him, the more I’m, like, He’s one-hundred-per-cent right.”
Among some skeptics, however, the profit McNamee has accrued from the technology that he now urges us to renounce makes him difficult to trust. One view of McNamee is that he has the gravitas of a man willing to admit that he was wrong. (“Shame on me,” he told one interviewer.) Another is that, having successfully ridden one wave, he is trying to ride another.