The Call for Corporate Action: NYU Stern Student Voices, Vol. 6 Spring 2019

FOR CORPORATE ACTION

NYU STERN STUDENT VOICES

VOL. 6 / SPRING 2019

EDITED BY

PROFESSOR JEFFREY J. YOUNGER, AMY DONG, JANE LIN, POOJA NARAYANAN AND TARA RANGWANI DESIGNED BY

JESSICA FUNG PHOTOGRAPHY BY

FOR CORPORATE ACTION

NYU STERN STUDENT VOICES

VOL. 6 / SPRING 2019

Front and back cover photos by Zach Asato, NYU Stern ‘20

ZACH ASATO

contents Letter from the Dean

DEAN GEETA MENON

Concluding Concussions: An End to Head Trauma in Soccer

Organic Waste Recycling with Black Soldier Flies

Introduction to Business and Society

PROFESSOR MATT STATLER

The Social Network: Using Social Media to Tackle Teen Suicide

LEAH SMITH

RANDALL ZUCCALMAGLIO

Cassava as Currency: The Plant that Can Provide an Education

Cleaning Crypto: How to Achieve Environmental Sustainability in Bitcoin Mining

Fewer Painkillers, More Profits: Ending America’s Opioid Crisis

On-Track to Deliver the Solution to Port Congestion

Combating Coyotes: Fighting Labor Trafficking in U.S. Agriculture

Saving the Cures of the Future

RAFAELA LAITAMAKI

AVERY FARM

Black Imprisonment Ends with Black Employment

BLAKE HEKMATPOUR

ALAN XIA

WHITNEY DANKWORTH

AMAN ASIJA

CASEY CHEN

Acknowledgements PROFESSOR JEFFREY J. YOUNGER

DHARAA RATHI

Photo by Zach Asato, NYU Stern ‘20 CONTENTS / 03

letter from the dean

GEETA MENON Dean of the Undergraduate College Abraham Krasnoff Professor of Global Business and Professor of Marketing NYU Stern School of Business

I am delighted to share the sixth edition of The Call for Corporate Action.

The NYU Stern Undergraduate College has experienced another fabulous year, and I am so proud of all the students and their achievements that contribute to this vibrant community. We have achieved another record-breaking number of applications for the incoming first-year class, and our selectivity has increased even more, hitting single digits at eight percent for the first time. The graduating class continues to impress with a 98 percent placement within six months of graduation.

We were proud to be included as a school to watch by Poets and Quants.

We believe that recognition is the result of our efforts to prepare students with coursework spanning core business fundamentals, global studies, and the liberal arts. We remain committed to educating students about the impact of business on society.

The Call for Corporate Action showcases essays written by students in their Business and Society course, tackling issues impacting society that can be addressed and mitigated by corporations.

I am excited by our students’ in-depth analyses on global issues and their proposed innovative solutions to the myriad of important global challenges.

We are so proud of these students as they embark on a bright path to change the world for the better.

I hope you take some time to read their inspiring work.

Warm regards, Geeta Menon

04 / LETTER FROM THE DEAN

introduction to

business and society

MATT STATLER Richman Family Director of Business Ethics and Social Impact Programming Clinical Associate Professor of Business and Society

Business and Society is the first of four courses in the Social Impact Core Curriculum required of all Stern undergraduate students. It includes weekly plenary sessions where students gather to listen and pose questions to prominent speakers as well as breakout discussion sections where students analyze texts and engage in dialogue, refining their ability to speak and write persuasively. The course (formerly titled Business and its Publics) has been a part of the Stern undergraduate experience for more than twenty years, providing a foundational touchstone for the entire Bachelor’s degree.

When it comes to the role of business in society, we live in interesting times. The news headlines present crises on many levels—from leadership scandals to rising inequality to climate change. At the same time, due in no small part to business innovations, people around the world are increasingly rising up from extreme poverty, while developing technologies hold the promise of continued social and environmental value creation.

So when first-year NYU Stern students are given the chance in Business and Society to bring their creative minds and passionate hearts to bear on the challenges facing global society, the results are awe-inspiring. Please join me and my faculty colleagues in celebrating what these student writers have accomplished in these pages. Together we can not only cultivate hope but also develop and implement strategies that lead toward a prosperous, just, and sustainable future.

Matt Statler

INTRODUCTION TO BUSINESS AND SOCIETY / 05

ESSAY BY

LEAH SMITH

CONCLUDING

CONCUSSIONS

Head trauma injuries, which are common in many contact sports, are dangerous to players’ long-term health.

While some sports organizations have taken steps to address concussion-related symptoms, soccer leagues have fallen behind. In this paper, Leah Smith explores how Viconic, a company that engineers passenger car safety gear, can utilize its technological expertise to develop similar protective headgear for soccer players.

AN END TO HEAD TRAUMA IN SOCCER

I

mpact-related injuries in sports are a common threat to an athlete’s success and development, yet most sprains, tears, and bone fractures—while undesirable—are still treatable and preventable. Head trauma, commonly referred to as a concussion, however, is an impact-related injury that has not been as successfully treated. In many contact sports, this injury has become a threat to players’ safety, impacting the lives of many professional athletes with rigorous “work” schedules. Findings from the American Association of Neurological Surgeons have stressed the issue of increased protection for athletes, encouraging doctors and athletic federations to take action and develop new resources to better address head trauma specifically. Unfortunately, because sports are bound to involve injuries, those who can address them often neglect the issue entirely. The injuries are deemed unpreventable and untreatable; they are simply “part of the game.”1 Instead, decision makers are more focused on the profitability of sports and their obligations to shareholders, which further draws attention away from any head trauma prevention tools that will have an honest impact.

Recently, the safety of athletes has become a more prevalent issue. The National Football League (NFL) was one of the first institutions to begin addressing these impact-related injuries after their limited knowledge and lack of protection for players’ health sparked widespread outrage. NFL players with multiple concussions have historically been neglected by the league, which, as a profit-driven business, deemed player revenue and fan excitement far more important than the safety of its athletes.

However, findings by Dr. Bennet Omalu, who conducted research on deceased NFL players, found that constant head trauma increased the chances of developing Chronic Traumatic Encephalopathy, a degenerative brain disease that often leads to depression, suicidal thoughts, and erratic behavior.2 The 2015 film Concussion by Peter Landesman later

documented the struggle that Dr. Omalu faced in his fight for players’ protection, generating even more conversations that eventually paved the way for new plans of action.

The NFL donated $30 million in an attempt to protect players’ safety rights by providing funds for brain trauma research by the National Institutes of Health, encouraging further studies and the development of new tests. The league also implemented new kick-off rules, such as moving the starting point to reduce the speed and frequency of collisions.

Additionally, the NFL employed a new and improved concussion protocol, which requires more attention to be given to the players who experience an impactful hit deemed worthy of evaluation. With these efforts, the NFL began to show signs of improvement; yet, it still faced backlash from players who felt their responses were driven by a desire for profit rather than a genuine concern for players’ wellbeing.3 The increased attention that football received has also led to developments in other sports; however, soccer seems to have been overlooked. The National Women’s Soccer League (NWSL), one of the largest and most well-known female leagues, faces similar concussion incidents as the NFL. Given the relatively new focus on the subject, however, very few studies have been conducted on the effects concussions have on sports players in general. Nevertheless, building on the studies carried out for football, doctors have found similar results for head injuries in soccer and have begun to address them accordingly.

An improved understanding of concussions has encouraged the U.S. Soccer Federation to take action and respond to the issue. The federation has implemented initial evaluation tests, such as the IMPACT test, that participating athletes must take before registering for the league. The results of this baseline neurocognitive test are compared to the results that the same player achieves after potentially receiving a concussion. The test evaluates concentration, short-term memory, and attention span, all of which

are severely affected by concussions. The federation also uses the Recognize and Recover Initiative, a standard procedure used to identify and address concussions in both professional and amateur club leagues. While both protocols have been adopted by all programs, they show limited effectiveness, ultimately making it the job of the players, coaches, athletic trainers, and league officials to properly address head trauma.4 A current NWSL player, Ali Krieger, describes how unreliable the IMPACT test can be by stating that she received similar results when she had a concussion versus when she was healthy. In many instances, the test is not conclusive unless the player exhibits extremely serious symptoms.5 Concussions vary in their severity, causing some players to experience symptoms more rapidly with greater effect. Nevertheless, because all head related injuries can be detrimental to an individual’s life, a protocol to test for both mild and serious concussions is necessary.

Mild concussions are most common in soccer particularly, as they can occur as a natural part of the game. “Heading the ball,” a common play, often causes head trauma, whether by repeated contact over time or or an immediate concussion.

Scholarly articles have indicated that heading the ball can be dangerous, and the extent of its severity has yet to be determined. According to Damaris Christensen, “If a person heads a ball properly…the force of the blow affects the front and back of the brain…the brain sloshes forward against the front of the skull, then it rebounds and hits the back of the skull.”6 The essential reality of this statement is that it applies even to players who head the ball “properly.”

From this, one can conclude that it is almost impossible to prevent such head trauma when it is simply a part of the game. Because players often head the ball in matches, they will almost certainly experience head injuries at some point.

While sports like football and lacrosse have helmets to protect them from these injuries, soccer does not. This fact has led to the development of new products, such

as the Full90 headgear, that are designed to combat the issue of head trauma in soccer. From the Full90 website, “the entire line of Full90 headgear has been designed to mitigate the typical impact forces that occur in soccer…and include coverage to the crucial impact zones at the forehead and temple.”7 This new innovation for players, approved by FIFA, NCAA, and many other soccer federations, is a positive step towards fighting this epidemic. However, there has been much criticism directed towards the headgear, as it has been noted that its effectiveness is based on “scientific uncertainty.”8 In particular, critics are skeptical of Full90’s construction methods and materials used. Full90 uses certain foams that are marketed to be both a cushion and a breathable material.

Whether they actually prevent head injuries or are simply comfortable and stylish to wear, however, has not been well-tested. Thus, while the effectiveness of Full90 headgear may be proven with more developed imaging technologies, a more realistic approach would be to increase protective measures in other ways.

Rather than use the designs developed by a sports-product company, a different approach could be to use car manufacturers’ advanced technology that protects drivers and passengers against head trauma. Viconic Sporting, a corporation that engineers protective solutions to impact-related injuries, has the expertise and resources to develop better headgear for soccer players by incorporating the technologies developed for passenger vehicle protection.

Viconic’s mission statement is to “Create and Promote Excellence.” Its technology has led the market for over a decade due to continuous innovation and has already protected against over 500 head, side, and leg injuries in the vehicle industry. More importantly, Viconic’s experts have developed an energy-absorbing system that can also be implemented in headgear for soccer players. Using this technology, Viconic can develop proper soccer headgear that will not only prevent traumatic impact

CONCLUDING CONCUSSIONS: AN END TO HEAD TRAUMA IN SOCCER / 09

but also allow players to play without distractions from the gear itself.9 Since Viconic has prior experience developing sports-related products, a shift to soccer headgear is entirely feasible. In fact, the company recently entered the NFL Head Health Challenge, in which it helped develop new technologies to better support concussed players’ health. As the leading developer of energy-absorbing systems and the most widely used technology in passenger car head injury protection, Viconic can plausibly become the leading manufacturer of soccer headgear as well, overtaking current leaders like Full90.

A partnership between Viconic, the NWSL, and Occupational Safety and Health Administration (OSHA) is a practical and profitable solution to soccer-related head trauma. Viconic’s technological expertise will keep R&D costs low, resulting in reduced opportunity costs for the corporation and higher margins. However, before Viconic can produce such headgear, it must ensure that soccer players will actually rely on its use. Its various partners, such as the NWSL, can promote the new gear by using their platforms to champion Viconic’s brand and market its specific products. Viconic could also work with its partners to get professional players currently using a different brand to switch to its own headgear. Full90 specifically pays certain professional

“

athletes to endorse its gear; Viconic could implement similar sponsorships with the backing of the NWSL. These endeavors should successfully bring the product widespread exposure and adoption, thus ensuring its profitability.

This initiative is unlikely to be completely successful without additional support from governmental organizations like OSHA, which can require the product to be worn and recognize concussions as an occupational hazard. Currently, OSHA does not support athletes’ safety due to its strict notion of what an “employee” truly is.

OSHA defines employees based on their relationship with their employers and whether they are privately contracted or not. As such, athletes are generally not considered “employees” based on specific wording in their contracts. In the professional leagues, OSHA should move to recognize soccer players as employees and require the use of headgear. This action would eventually encourage amateur leagues to understand the severity of head trauma and enforce similar regulations. Overall, recognition by organizations such as OSHA can positively influence the way all soccer leagues think about concussions and their impact on players’ safety.10 Support from both the NWSL and OSHA will be instrumental in spreading awareness of head-related injuries and expanding Viconic’s new product

Because sports are bound to involve injuries, those who can address them often neglect the issue entirely. These injuries . . . are simply ‘part of the game.’”

line, which will allow the corporation to profit and promote soccer players’ safety. Their product endorsement will encourage amateur soccer players to purchase Viconic’s products as well because young athletes tend to view professional athletes as role models. The ability to attract a younger audience and highlight the importance of preventing head injuries will encourage both players and their parents to purchase the gear, as many parents will be willing to purchase a product that protects their children’s lives.

Of course, the aim of the initiative is more than just profit—it will also dramatically reduce the lasting impact of head trauma in soccer. Viconic’s experience and credibility will position the headgear well in the market, and the NWSL and OSHA will help ensure its success. Together, these three organizations will help decrease head injuries and symptoms of players even after they have suffered repeated head trauma.

While Viconic’s new product will decrease the impact of head trauma, it will not eliminate the problem entirely.

Ongoing medical research should be carried out extensively to better understand concussions as a whole and how they can potentially be treated.

Sports will always involve injuries, which is unfortunately a risk athletes must take for doing what they love.

However, initiatives such as Viconic’s— if implemented properly—can mitigate such risks. Hopefully, this strategic

partnership will encourage the use of a new safety product, resulting in higher quality play and better health for all

“Sports-Related Head Injury.” AANS, American Association of Neurological Surgeons, 2018, www.aans.org/Patients/ Neurosurgical-Conditions-and-Treatments/Sports-related-HeadInjury.

2 Ward, Joe, et al. “111 N.F.L. Brains. All But One Had C.T.E.” The New York Times, The New York Times, 25 July 2017, www.nytimes.com/ interactive/2017/07/25/sports/football/nfl-cte.html.

3 Ezell, Lauren. “Timeline: The NFL’s Concussion Crisis – League of Denial: The NFL’s Concussion Crisis.” PBS, Public Broadcasting Service, 8 Oct. 2013, www.pbs.org/wgbh/pages/frontline/sports/ league-of-denial/timeline-the-nfls-concussion-crisis/.

4 US Soccer Federation. “Head & Brain Conditions.” Recognize to Recover, www.recognizetorecover.org/head-andbrain/#concussions.

5 Megdal, Howard. “Competitive Environment Complicates Decisions About Head Injuries.” The New York Times, The New York Times, 3 May 2015, www.nytimes.com/2015/05/04/sports/soccer/ competitive-environment-complicates-decisions-about-headinjuries.html.

1

LEAH SMITH I hope to educate my audience on the severity of concussions and how they have often been overlooked, particularly in soccer. As recent studies and movies have come out about concussions in football, many people forget that there are similar rates of concussions happening in soccer and even higher rates for female players. I hope that my paper educates and offers a solution for this issue in order to prevent long-term damages to players.

soccer players.

Christensen, Damaris. “Heading For Injury.” JSTOR [JSTOR], 27 Nov. 1999, www.jstor.org/stable/pdf/4011950. pdf?refreqid=excelsior:62f8a3f4c36fa15cb4c2646261ec3145.

7 “ABOUT FULL90.” Full90 – KEEPING YOU IN THE GAME, full90. com/about/.

8 Longman, Jere. “Soccer Headgear: Does It Do Any Good?” The New York Times, The New York Times, 27 Nov. 2004, www.nytimes. com/2004/11/27/sports/soccer/soccer-headgear-does-it-do-anygood.html.

9 “Viconic’s Focus Is to Engineer Solutions That Provide the Most Effective Protection from Impact-Related Injuries. Our Proprietary Technology and Engineered Solutions Are the Future of Sports Safety.” Viconic Sporting, www.viconicsporting.com/.

10 “UNITED STATES DEPARTMENT OF LABOR.” Occupational Safety and Health Administration, www.osha.gov/.

Photo Credits: MSC U15 Green/Flickr—page 6 U.S. Air Force photo/Kemberly Groue—page 8 Eric Kilby/Flickr—page 10 6

CLASS OF 2021 • ACTUARIAL SCIENCE

ESSAY BY

RANDALL ZUCCALMAGLIO

Organic Waste Recycling with Black Soldier Flies

Population growth in developing nations necessitates the need for more food and specifically, increased protein production. To address this issue, student Randall Zuccalmaglio proposes that TakaTaka Solutions in Nairobi, Kenya, shifts its use of organic waste to rear black soldier flies as livestock feed.

B

y 2 0 5 0, t h e w o r l d population will grow to 9.7 billion. More than half of this growth will occur in developing nations.1 Rising global incomes will cause the demand for animal-based protein to double by 2050, and meeting this demand will result in an 80 percent increase in agricultural carbon emissions. 2, 3, 4 If the world continues to grow crops and raise livestock using current systems of production, then climate change will quicken, food insecurity will spread, and natural resources will be depleted. To avoid such a future, environmentally sustainable systems of crop and protein production must be adopted, especially in developing nations.

COSTS OF CONVENTIONAL CROP PRODUCTION

Farmers must increase the yield per acre of major crops by 70 percent by 2050 to avoid the need to convert millions of acres into farmland. 5 Public and private sector institutions are currently attempting to close the yield gap between developed and developing nations by sponsoring the adoption of genetically modified organisms (GMOs) and chemical fertilizers. While these strategies are intended to raise crop yields, they also increase the risk of ecological disruption and water pollution.

Recent agricultural blight has led multiple African nations to begin trial tests of GMOs in various regions. 6 An examination of the long-term performance of genetically modified crops in the United States, however, yields worrying results: American yields are significantly lower than those in Western Europe, whose farms do not use GMOs.7 Furthermore, predatory growth strategies by GMO suppliers globally have led to monopolistic markets that decrease agricultural biodiversity, which increases the risk of a singular pest, disease, or climate-related event disrupting the entire food supply.8, 9 GMOs are also often used in conjunction with nitrogen-phosphorous

14 / RANDALL ZUCCALMAGLIO

fertilizers, which leave a large carbon footprint and pollute local rivers, lakes, and oceans. The fertilizer releases chemical gases upon use, while leftover nitrogen enters the water table through rainwater to create dead zones: areas so devoid of oxygen that they become uninhabitable by fish and other marine populations.10, 11 Should developing nations adopt GMOs and nitrog en-phosphorous fertilizers, they risk facing significant supply chain disruptions and increased levels of pollution. Already bearing the brunt of climate change effects, developing nations in Africa and Southeast Asia may further struggle with economic growth and food security if these risks are magnified by higher levels of pollution.12, 13

COSTS OF CONVENTIONAL LIVESTOCK REARING

The rearing of livestock requires a steady supply of animal feed, the production of which accounts for half of the world’s agricultural acreage. 14 Additionally, farmers predominantly rely on marine life to provide livestock with a protein-rich diet, yet this dependence is unsustainable in the long-run.

An overreliance on the ocean as a source of protein has caused the global fish population to fall by 49 percent since 1950.15 This decline underscores a harsh reality: if fish continue to reproduce at a rate slower than depletion, their inevitable population collapse will devastate oceanic ecosystems and lead to global food insecurity. While effects would be far reaching, one unfortunate result would be that farmers are left without a reliable source of protein.16 While farmers in developing nations are making efforts to optimize rearing conditions—to increase the yield per acre of protein production and thus reduce demand for fish-based feed­— experts agree that successful long-term rearing will come only with the adoption of an alternative, more sustainable source of protein for animal feed.17

TAKATAKA SOLUTIONS

If developing nations adopt Western m et h o d s o f i n c r e a s i n g c r o p a n d protein yields, the amount of pollution, loss of biodiversity, and reliance on unsustainable protein sources will ultimately result in heightened food insecurity, a more acute risk of ecosystem collapse, and a faster rate of climate change. To avoid food insecurity and pollution, farmers in Africa must find a sustainable way to boost agricultural yields and feed livestock. One potential solution can be found in TakaTaka Solutions, a composting company based in Nairobi, Kenya.

Nairobi, the capital of Kenya, produces over 900 thousand tons of waste each year, less than 40 percent of which is processed by public or private waste management companies. 18 TakaTaka Solutions, a waste management company, provides affordable waste management services to 25 thousand citizens in the city by fully repurposing 95 percent of total collected waste, processing approximately 20 thousand pounds per day into sellable recycled and composted products. 19, 20, 21 The collected organic waste is also used to create the TakaTaka Solution Biobooster, a high-quality, chemical-free compost fertilizer, which hundreds of farmers around Nairobi currently rely on to support their farm operations.22

BREEDING BLACK SOLDIER FLIES

TakaTaka Solutions strives to create a cleaner and healthier city by treating waste as an opportunity rather than a burden. As such, a new opportunity arises for TakaTaka Solutions to take advantage of the waste in developing nations, including Kenya, of which approximately 60 percent is organic. 23 TakaTaka can collect this waste and use it to rear black soldier flies. In their pupal stage, these flies can not only serve as a sustainable source of protein as animal feed but also convert organic waste into high-quality fertilizer capable of raising agricultural yields.

Black soldier flies (BSF) have a life cycle of 45 days, maturing from eggs to

pupae just 18 days after birth.24 To obtain the energy needed for their life cycle, they consume massive amounts of organic waste. Once in the pupal stage, they can be used as animal feed for chickens, fish, pigs, or any other animal raised for consumption. The pupae are 40 percent protein and 30 percent fat, the ideal ratio of protein to fat in livestock feed.25 The rearing of black soldier flies to convert thousands of pounds of organic waste is neither capital nor technology intensive. Breeding black soldier flies requires a small building—usually 20 by 40 feet—that houses mating units in cylinders of mosquito netting and wood with cardboard in the center. 26 Eggs,

Using an initial ten tons of organic waste, this model produces 300 kg (~660 lbs) of dried larvae and 3,346 kg (~3.7 tons) of organic compost.28 TakaTaka Solutions already has the facilities and infrastructure necessary to collect and sort organic waste, as well as a network of farmers that trusts the organization to provide quality agricultural products. To follow through with this plan, TakaTaka would need to invest in new infrastructure and a pellet machine; neither, however, requires much upkeep. The buildings require no heating or cooling, the conversion process is not labor-intensive, and the only input is organic waste, which TakaTaka already

THE BENEFITS OF BLACK SOLDIER FLY-BASED ANIMAL FEED

Using black soldier fly pupae as animal feed alleviates the need to use fish or soybean as a protein source, has no adverse effects on the health of livestock, and creates an economic incentive to collect food waste. Looking at a variety of protein sources, including quail, fish, cattle, and pigs, studies have concluded that there are no harmful effects associated with switching from a fish- or soybean-based feed to feed consisting of black soldier fly pupae; in fact, the introduction of BSF feeds often results in accelerated growth, healthier populations, and heavier weights, increasing profits for livestock

“

Using an initial ten tons of organic waste, this model produces 300 kg (~660 lbs) of dried larvae and 3,346 kg (~3.7 tons) of organic compost.”

which are laid inside the cardboard, are then transferred to conversion buildings, which can contain either large, rectangular concrete tubs or garbage bins functioning as composting bins.

The pupae hatch in the waste almost immediately and crawl out of the organic waste themselves, thus removing the need for labor-intensive extraction.27 In both building setups, they exit the waste via ramps that lead to collection buckets in a process known as “self-harvesting.”

During growth, the flies consume organic waste and excrete casts, a form of soil aggregate; the next-stage pupae leave behind high-quality organic compost.

collects.29 The initial capital costs would be recovered through two revenue streams: the sale of high-quality compost and the sale of insect-based animal feed.

TakaTaka could sell the organic compost to its existing customer base either as a separately branded product at a higher price point or as integrated portion of the TakaTaka Solution Biobooster. As for its animal feed, TakaTaka could leverage its existing relationships with farmers in Kenya or expand to new markets, developing sales pipelines that target protein-intensive farms.

farmers. 30 Because black soldier flies have a micronutrient composition that removes the need for additional plants or animals in the feed production process, they are an ideal alternative to other food sources.31 In addition to benefiting farmers in Kenya, the potential success of BSF feed in Nairobi may set off a chain reaction across the continent, prompting other waste manag ement companies to similarly process waste using black soldier flies. TakaTaka could facilitate this growth by sharing its model with companies and supporting their growth through partnerships. An article from

ORGANIC WASTE RECYCLING WITH BLACK SOLDIER FLIES / 15

the University of North Texas supports the validity of this plan, indicating that black soldier fly waste management systems have already been proven to be economically feasible in virtually every type of urban center, including cities such as Dallas and Accra.32 TakaTaka could thus pioneer a business model that works to alleviate the demand for overfishing and promote a healthier, more profitable protein industry by providing a more sustainable method of feeding livestock through black soldier flies.

THE UNIQUE BENEFITS OF BSF ORGANIC FERTILIZER

TakaTaka Solutions could rear black soldier flies to not only create sustainable animal feed but also produce an enhanced organic fertilizer. Throughout the waste management process, the flies decrease the presence of harmful bacteria.

Specifically, black soldier fly larvae cut the presence of E. coli, salmonella, and other harmful bacterium found in compost, reducing the risk of crop contamination.33 The larva filter the waste through consumption, leaving behind compost that has been processed by their digestive tracts and thus lowering the chance of animals coming into contact with harmful bacteria. 34 TakaTaka could thus take advantage of this process to increase crop yields and lower the cost of producing compost.

Rearing black soldier flies also results in a organic fertilizer that has a higher

concentration of nitrogen phosphorous.

Farmers typically increase crop yield by adding nitrogen and phosphorous to soil; this process however, uses natural gas to produce a chemical compound and often leaves toxic residues that pollute rainwater.35 Organic fertilizer, on the other hand, is more natural but lacks high levels of nitrogen and phosphorous, making it less effective than chemical fertilizer.

Because black soldier flies increase the amount of naturally occurring nitrogen, phosphorous, and ammonia in the compost they leave behind, they create a natural fertilizer that is more effective than traditional chemical fertilizers.36 Organic fertilizer is critical to boosting yields in developed nations because it provides crops with critical nutrients without relying on carbon-emissionheavy chemicals. TakaTaka should offer an organic fertilizer that is a viable alternative to chemical fertilizers without requiring the addition of chemical-based supplements. A BSF-based fertilizer would avoid the risk of polluting water sources or turning to GMOs designed to adapt to nutrient-deficient soil; it would also reduce emissions and preserve the natural biodiversity of East Africa.

THE CHALLENGE OF EDUCATING CONSUMERS

While consuming insects directly is practiced in a number of regions in Africa, East African cuisine does not typically include insects as a protein source. Furthermore, Kenyan farmers

RANDALL ZUCCALMAGLIO We need to drastically change the way we produce food so that it’s more sustainable, starting with new sources of protein and higher crop yields across the board. After reading about new insect-based foods and organic food waste, I found that we only need two things to do it: black soldier flies and some dedicated bug lovers.

16 / RANDALL ZUCCALMAGLIO

may not be eager to buy animal feed that is insect-based.

While there are programs designed by Western governments, NGOs, and the UN that aim to sponsor direct consumption in Kenya, there is still significant cultural resistance to eating insects. 37 Farmers may see insect-based animal feed as a risky alternative to fish-based feed and be reluctant to make the switch, which could decrease the price that TakaTaka is able to charge for their feed. There is hope, however, that recent, successful programs led by the Kenyan government and Dutch NGOs that fund BSF-rearing by Nyeri farmers will help change public attitudes towards the insects.38 The International Centre for Insect Physiology and Ecology (INCIPE) is also working to educate livestock farmers about the advantages of switching to BSF-based feed, thus sharing the burden borne by TakaTaka Solutions.39 To further shift consumer preferences, TakaTaka should consider partnering with INCIPE to execute joint market education campaigns and share any technological innovations. TakaTaka’s organic waste collection infrastructure could help INCIPE scale its existing black soldier fly facilities by providing easy and affordable access to organic waste, potentially providing TakaTaka with yet another revenue stream.

CONCLUSION

If TakaTaka were to use black soldier flies in their waste management process,

CLASS OF 2021 • BUSINESS & POLITICAL ECONOMY

it could provide farmers with nutrientdense, organic fertilizer and sustainable animal feed while simultaneously enhancing its own bottom line. So long as it is able to overcome the learning gap and

shift consumer preferences, TakaTaka can take waste, a negative externality that typically harms the environment, and use it to feed current and future generations of Africans in a sustainable, effective way,

Jones, Sam, and Mark Anderson. “Global Population Set to Hit 9.7 Billion People by 2050 despite Fall in Fertility.” The Guardian, Guardian News and Media, 29 July 2015, www.theguardian.com/ global-development/2015/jul/29/un-world-population-prospectsthe-2015-revision-9-7-billion-2050-fertility.

2 Henchion, Maeve et al. “Future Protein Supply and Demand: Strategies and Factors Influencing a Sustainable Equilibrium.”

Foods 6.7 (2017): 53. Crossref. Web. 3 Tilman, David, and Michael Clark. “Global Diets Link Environmental Sustainability and Human Health.” Nature News, Nature Publishing Group, 12 Nov. 2014, www.nature.com/articles/nature13959.

4 Ibid.

5 “2050: A Third More Mouths to Feed.” 2050: A Third More Mouths to Feed, 23 Sept. 2009, www.fao.org/news/story/en/item/35571/ icode/.

6 Carier, Steven. “Led by Nigeria, Africa Opening Door to Genetically Modified Crop Cultivation.” Genetic Literacy Project, 6 Mar. 2016, geneticliteracyproject.org/2017/03/06/led-nigeria-africa-graduallyopening-door-genetically-modified-crop-cultivation/.

7 Gould, Fred. Genetically Engineered Crops: Experiences and Prospects.

National Academies of Sciences, Engineering, and Medicine, 2016.

8 Keim, Brandon. “Monsanto’s Newest GM Crops May Create More Problems Than They Solve.” Wired, Conde Nast, 2 Feb. 2015, www. wired.com/2015/02/new-gmo-crop-controversy/.

9 Mitchell, Dan. “Why Monsanto Always Wins.” Fortune, 26 June 2016, fortune.com/2014/06/26/monsanto-gmo-crops/.

10 Gillis, Justin. “Damaging the Earth to Feed Its People.” The New York Times, The New York Times, 4 June 2011, green.blogs.nytimes. com/2011/06/04/damaging-the-earth-to-feed-its-people/.

11 Gold, Russell. “Entrepreneurs Wade Into the ‘Dead Zone’.” The Wall Street Journal, Dow Jones & Company, 12 Aug. 2009, www.wsj.com/ articles/SB125003834803724511.

12 Badjeck, Marie-Caroline, et al. “THE VULNERABILITY OF FISHING-DEPENDENT ECONOMIES TO DISASTERS .” FAO Fisheries and Aquaculture Circular, vol. 1081, 2013, www.fao.org/ docrep/018/i3328e/i3328e.pdf.

13 “Background Document: The Social and Economic Consequences of Malnutrition in ACP Countries.” European Parliament, 2014. http:// www.europarl.europa.eu/meetdocs/2009_2014/documents/acp/ dv/background_/background_en.pdf.

14 “New Research from MorningStar Farms, WRI Illustrates Environmental Benefits of Eating Less Meat.” Sustainablebrands. com, 20 Apr. 2016, www.sustainablebrands.com/news_and_views/ ict_big_data/sustainable_brands/new_lca_morningstar_farms_ shows_significant_environme.

15 Campbell, Andy. “Crucial Marine Populations Cut In Half Since The 1970s: Report.” The Huffington Post, TheHuffingtonPost. com, 17 Sept. 2015, www.huffingtonpost.com/entry/crucialmarine-populations-cut-in-half-since-the-1970s-report_ us_55f9ecd2e4b00310edf5b1b2.

16 Doyle, Alister. “Ocean Fish Numbers on ‘Brink of Collapse’: WWF.” Reuters, Thomson Reuters, 16 Sept. 2015, www.reuters.com/article/ us-environment-oceans/ocean-fish-numbers-on-brink-of-collapsewwf-idUSKCN0RG1JW20150916.

17 Johnson, Nathanael. “To Make Meat Greener, Make It More Efficiently.” Grist, 28 July 2015, grist.org/food/the-practical-casefor-producing-meat-more-efficiently/.

1

creating value for both the company and society.

Soezer, Alexandra. “Kenya: Solid Waste Management NAMA.” NDC Support Programme, www.undp.org/content/ndc-supportprogramme/en/home/resources/namas/kenya-solid-wastemanagement-nama.html.

19 “Impact.” Takataka Solutions, takatakasolutions.com/about/why-wecare-about-waste/.

20 “Why We Care about Waste.” Takataka Solutions, takatakasolutions. com/about/why-we-care-about-waste/.

21 “Impact.” Takataka Solutions, takatakasolutions.com/about/why-wecare-about-waste/.

22 “How We Operate.” Takataka Solutions, takatakasolutions.com/ about/why-we-care-about-waste/.

23 “Waste Composition.” The World Bank, http://siteresources. worldbank.org/INTURBANDEVELOPMENT / Resources/336387-1334852610766/Chap5.pdf.

24 “Alternative Sources of Food for Aquaponics in the U.S. Virgin Islands: A Case Study with Black Soldier Flies.” University of the Virgin Islands, 2016.

25 Lalander, Cecilia H., et al. “High Waste-to-Biomass Conversion and Efficient Salmonella Spp. Reduction Using Black Soldier Fly for Waste Recycling.” Agronomy for Sustainable Development, vol. 35, no. 1, 2 July 2014, pp. 261–271., doi:10.1007/s13593-014-0235-4.

26 Sheppard, D. Craig, et al. “A Value Added Manure Management System Using the Black Soldier Fly.” Bioresource Technology, vol. 50, no. 3, 13 Oct. 1994, pp. 275–279., doi:10.1016/0960-8524(94)90102-3.

27 Ibid.

28 Ibid.

29 “How We Operate.” Takataka Solutions.

30 Wang, Yu-Shiang, and Matan Shelomi. “Review of Black Soldier Fly (Hermetia Illucens) as Animal Feed and Human Food.” Foods 6.10 (2017): 91. PMC. Web. 30 Apr. 2018.

31 Ibid.

32 Barri, Tammy. “Evaluation of the Economic, Social, and Biological Feasability of Bioconverting Food Wastes with the Black Soldier Fly.” University of North Texas, 2004.

33 Lalander, Cecilia H., et al. “High Waste-to-Biomass Conversion and Efficient Salmonella Spp. Reduction Using Black Soldier Fly for Waste Recycling.” Agronomy for Sustainable Development, vol. 35, no. 1, 2 July 2014, pp. 261–271., doi:10.1007/s13593-014-0235-4.

34 Ibid.

35 Gold, Russell. “Entrepreneurs Wade Into the ‘Dead Zone’.”

36 Lalander, Cecilia H., et al. “High Waste-to-Biomass Conversion.”

37 Winsor, Morgan. “Insects as Food? Kenyan Scientists Propose Eating Bugs to Curb Food Insecurity, Malnutrition.” International Business Times, http://www.ibtimes.com/insects-food-kenyan-scientistspropose-eating-bugs-curb-food-insecurity-malnutrition-2329771.

38 Mugo, Irene. “Kenyan farmers benefit from insect rearing project.” Business Daily Africa, 19 October 2017, https://www. businessdailyafrica.com/news/counties/4-000-farmers-learn-howto-rear-insects/4003142-4147096-10lrseez/index.html.

39 Kanyi, Wambagu. “Nyeri farmers to rear black soldier flies.”

The Kenya Star, 23 October 2017, https://www.the-star.co.ke/ news/2017/10/23/nyeri-farmers-to-rear-black-soldier-flies_ c1645842.

Photo Credits: Egor Kamelev/Pexels—page 12 Dennis Kress/Wikimedia Commons—page 15 18

ORGANIC WASTE RECYCLING WITH BLACK SOLDIER FLIES / 17

The Social

Network:

USING SOCIAL MEDIA

TO TACKLE TEEN SUICIDE ESSAY BY

With teenage suicide rates increasing, it is more important than ever to find effective ways to diagnose depressed or suicidal teens. Alan Xia challenges Facebook, with its expertise in data mining and analytics, to use this profiling power to make a positive difference.

ALAN XIA

I

n the last decade, suicide has become the second leading cause of death among teenagers.1 According to the U.S. Center for Disease Control and Prevention, the suicide rate for adolescent boys has increased by 30 percent over the last five years. 2 For adolescent girls, this number has increased by 50 percent. 3 Furthermore, research from The Jason Foundation, a youth suicide prevention campaign, found that 2017 was a record year for adolescent suicides, with over three thousand teenagers losing their lives at their own hands.4 In a world where technology is becoming increasingly prevalent, social media may be in a unique position to lower these numbers significantly.

A SILENT CRY FOR HELP

Te e n s u i c i d e c a u s e s e n t i r e communities to suffer from emotional distress. The devastation of teenagers taking their own lives while in their prime traumatizes loved ones. Consequently, this trauma disrupts society, even causing people to become paranoid or distrust others. Research from support organization HealthyPlace found that anxiety and distress are common experiences shared by the friends, family, and peers of suicide victims. 5 An atmosphere of distrust emerges as well, making it even more difficult for a community to cope in the aftermath of a suicide. In extreme cases, whole communities can spiral into turmoil.

Furthermore, a survey conducted by support group Survivors of Bereavement found that suicide is just as contagious as any other common illness.6 Supporting this point, a study conducted by the Department of Psychology at Georgia State University found that siblings, friends, and peers of suicide victims typically had higher rates of depression and a significantly increased risk of committing suicide themselves.7 Labeled by the World Health Organization as “copycat suicide,” this phenomenon puts communities at risk of a suicide chain reaction and, in turn, contributes to

today’s high suicide rates.8 Communities have attempted to tackle this issue in the past. Schools have increased the number of counselors on campus. Doctors have connected families to specialized psychiatric practices. These common suicide prevention methods have been extremely successful, treating up to 80 percent of suicidal teenagers over the last ten years.9 However, these methods are post-diagnosis solutions; in other words, they are only able to help teenagers actively seeking help or already diagnosed as suicidal or depressed. A study conducted by the Depression Support Alliance found that nearly two out of three teenagers suffering with depression do not actively seek treatment.10 For these teenagers, existing treatment methods cannot help them.

Without a way to successfully diagnose depressed teenagers or treat undiagnosed ones, suicide rates will continue to rise, no matter how effective post-diagnosis treatment methods may be.

Although diagnosis of depressed or suicidal teenagers is extremely difficult, a recent study may open a plausible solution to this problem. A study conducted by Dr. Christopher Danforth of the University of Vermont and Dr. Andrew Reece of Harvard University found that teenagers who are depressed can be identified from their social media photos or posts almost 70 percent of the time. 11 The study found that using popular platforms such as Facebook or Instagram, at-risk teenagers often posted statuses signaling depression. 12 For example, depressed teenagers tended to use more greyscale pictures favoring lower saturation. 13 These teenagers also posted at a higher frequency than regular users.14 Furthermore, depressed teenagers commonly used dark keywords such as “depressed” or “stressed” in their captions.15 Interestingly, the large number of teenagers using social media may open a new avenue for detecting and thus effectively diagnosing depression.

Although teenagers may be actively showing signs of depression on social media, communities have not reacted

effectively. Research from the National Cyber Security Alliance found that although 83 percent of teenagers are friends with their parents on social media, 67 percent know how to hide what they do online.16 According to the World Health Organization, depressed teenagers are more inclined to hide information from parents.17 Therefore, even though many depressed teenagers are displaying signs online, the evidence is mostly inaccessible to parents, teachers, or counselors.

However, peers of depressed teenagers may see these signs. Still, a study from the Department of Public Health found that teenagers who see these red flags on social media may not report them because they do not want to get involved in their peers’ problems or invade their privacy.18 Only about five percent of teenagers have reported depressed or suicidal signs on social media to adults.19 The information

asymmetry makes it difficult for adults to be aware that teenagers may be displaying signs of depression. Thus, the responsibility of making sure teenagers’ cries for help are not ignored could fall to a third stakeholder group with access to social media posts: social media companies themselves.

THE STATE OF THE SOCIAL NETWORK

Facebook is in a unique position to ensure teenagers’ calls for help on social media do not go unnoticed. For a social media company to effectively tackle the issue of teen depression using their social media platform, it must have a large enough teenage user base and be popular among the teenage community.

Facebook’s 140 million teenager users and status as the world’s largest social media platform fit these criteria quite well.20 Furthermore, Facebook’s expertise

“

and established infrastructure in data analytics give the company enough technical knowledge to effectively detect signs of depression that would otherwise be hidden from parents, teachers, and counselors. Few other companies with a user base as large as Facebook’s would have the technology to do this. For example, the only social media platform with more teenage users than Facebook, Snapchat, has traditionally used servers that can only store user information up to 30 days, a feature incompatible with long-term illnesses like depression. 21 Furthermore, pictures sent to other users can only be viewed twice, making it difficult to predict trends of depressive behavior. Facebook’s dominant presence in the social media community, expertise in data analytics, and long-term storage of user data give it the ability to review signs of depression and potentially

Without a way to successfully diagnose depressed teenagers or treat undiagnosed ones, suicide rates will continue to rise, no matter how effective post-diagnosis treatment methods are.”

create an effective detection strategy.

By tackling this prominent issue, shared value would be created between Facebook and the community. More community stakeholders might trust and use Facebook if it aided teen suicide prevention efforts, and the feature itself might increase Facebook’s competitive advantage over other social media platforms such as Snapchat.

Nevertheless, there is still much controversy behind the use of data analytics. By most standards, the extraction and analysis of teenage user data is an invasion of privacy. To address this concern, Facebook would have to get permission from users to gather their information and make it clear to users that their information would be used for this purpose only. While Facebook could allow individual users to opt into the program, this choice would be counterintuitive. Teenagers showing signs of depression on Facebook would likely not agree to have their information analyzed. Facebook can resolve this issue by making an option for parents to allow Facebook access to their Wi-Fi network.

Then, Facebook could monitor all user activity under the network, including the teenager’s activity. Although this would undermine the social media privacy for all users under the Wi-Fi network, it is a tradeoff that some parents would make, especially in areas where teen suicide is extremely prevalent. In interviews with Jin Xiao and Yingshan Guo, two parents living in Plano, Texas—a city where teen suicide is unfortunately prevalent— both stated they would be willing to give up a little bit of their internet privacy to ensure the mental health of their children.22 They also agreed that most of their friends would feel the same, as the traumatic effects of the suicides of five Plano teenagers in 2017 still linger in many Plano parents’ minds.23 However, Facebook users have recently criticized Facebook for stealing user information without their consent.

They assert that Facebook’s practice of data mining is an invasion of their privacy.

Data mining involves the examination of user information databases to predict

future user trends.24 Facebook uses data mining and intelligent algorithms to detect and analyze patterns of interest.25 They then sell these “interest patterns” and demographic data to advertisers and profit from the sold data; advertisers, in turn, provide targeted ads for the user base. However, users have become skeptical of the true intentions of Facebook’s data mining. The Cambridge Analytica scandal revealed that nearly 87 million Facebook users’ information was sold and later targeted information was distributed, designed to influence the 2016 presidential election.26 Initially after the scandal in March, Facebook’s stock price dropped to its lowest price in nearly two years.

Its reputation and public image also suffered greatly. A Twitter hashtag “#DeleteFacebook” exploded over social media, with over 40 thousand users urging their followers to delete their Facebook accounts in the first two hours.27 Additionally, prominent newspapers such as the New York Times published articles calling Facebook “a Frankenstein” shortly after the events of Cambridge Analytica.28 Yet, according to the Wall Street Journal, Facebook did not suffer great financial losses after the scandal.29 Since the initial drop, its stock price recovered, and, as of June 1, 2018, is once again at an alltime high. 30 In fact, Facebook’s user count increased by nearly seven million users since the scandal.31 Nevertheless, Facebook’s negative public image may hurt it in the long run with decreased user trust and a damaged brand.

To address this concern, Facebook is actively making efforts to improve its public image. According to a post by CEO Mark Zuckerberg, Facebook has upgraded its privacy settings and locked down its security, reducing the amount of user information accessible to app developers.32 Furthermore, Zuckerberg appeared before Congress to address concerns the government had about Facebook.33 Zuckerberg ’s actions have made it clear that Facebook cares about improving its public image.

Despite these efforts, people are still skeptical about Facebook’s practice

of data mining. 34 While the optimal solution for Facebook would be to stop data mining entirely, this action is highly unlikely. Facebook’s entire business model revolves around targeting users with relevant ads, which requires data mining. 35 While Facebook has opt-out options for users that forbid Facebook from analyzing their activity, they must manually go into their settings to opt-out.

Most users are unaware of this option.

One possible way for Facebook to improve its image would be to show the public that its data mining can be used for good rather than evil. If there were a way for Facebook to use its analytics expertise to benefit society, users may be more receptive to data mining and ultimately have more trust in Facebook.

THE ROAD TO DIAGNOSIS

Envision a situation where Facebook uses its well-established expertise in algorithms and data analytics to profile teenagers with depression based on post and search history. Facebook already specializes in profiling users to deliver relevant ads. For instance, if a user searches up dog videos and posts about dogs, Facebook algorithms will profile that user as a “dog-lover” to present them ads about dogs. These same algorithms can be used to diagnose depression in teenagers who display relevant signs on social media. By extracting and analyzing teenage user data, Facebook algorithms could profile teenagers as depressed if their post and search histories follow the trends described in Danforth and Reece’s study. These algorithms, if written to uncover the correlation between online behavior—such as high frequency posting and low saturation pictures—and medical depression, could dramatically change the status quo of teen suicide.36 Furthermore, Facebook’s use of algorithms to profile teenagers with depression would create shared value between Facebook and society. Harvard professors Michael Porter and Mark Kramer define shared value as a practice that improves both the competitiveness of a business as well as the social conditions of the community in which

THE SOCIAL NETWORK: USING SOCIAL MEDIA TO TACKLE TEEN SUICIDE / 21

it operates. 37 Using data mining to help society diagnose teenagers with depression, Facebook could help address a serious social issue and simultaneously improve public perception of its business model. By tackling the difficult issue of teen suicide, Facebook could improve its image, allowing it to better compete against other social media platforms. At the same time, it could help thousands of undiagnosed teenagers receive the support they need. This system would help society take a big step towards tackling the pressing issue of suicide.

G i v e n a c c e s s t o a n et w o r k o f information, Facebook can begin to monitor the behavior of users. If Facebook believes a user on the network is displaying signs of depression, Facebook would send the parent who opted into the program a notification. The notification would include any red flags Facebook noticed about the teenager’s behavior. Furthermore, it would show parents locations of local psychiatric and counseling practices. It would then be up to parents to decide what to do with this information. Some parents might directly take their child for counseling or psychiatry. Some parents may try to console their child. Some parents might sit their child down to talk it over and realize the only reason their child has searched up numerous articles about suicide is because they are writing a paper on depression. Overall, Facebook would bridge the information asymmetry between teenagers and parents.

Another issue that arises within this program is the invasion of the teenagers’ privacy. The issue remains that Facebook would be extracting and analyzing teenagers’ user information without their consent but with their parents’ consent.

Although this program would infringe on the privacy of teenagers, there are times when parents deem it necessary to invade their children’s privacy to ensure their safety. Take parental controls, for example. While blocking their children from viewing explicit websites may be an infringement on their personal privacy, it is still something nearly 50 percent of parents deem necessary to protect their children from inappropriate sites.38 Similarly, in this case, the increasing prevalence of teen suicide may convince parents to take necessary actions to ensure the mental health of their children.

Although this solution would represent the first time that a social media site attempts to diagnose teenagers with depression through profiling, it would not be the first time social media influenced teenagers with depression. In August 2017, Grammy-nominated rapper and songwriter Logic released a song titled “1-800-273-8255.” Sharing its title with the National Suicide Prevention Lifeline phone number, this song took the world by storm, reaching #3 on Billboard’s Hot 100.39 The song quickly found its way onto social media, where its popularity grew even more. A few months after the song’s release, the National Suicide Prevention Lifeline reported a 25 percent increase

ALAN XIA Growing up, I heard the words “stress” and “depression” being thrown around constantly, but it wasn’t until I lost a friend to suicide that I realized just how severe these words were. My community banded together to develop mental health resources for adolescents like myself, but that didn’t change the fact that my friend was gone. From that moment on, I knew I wanted to address the issue of teen suicide before—rather than after—tragedy strikes.

22 / ALAN XIA

in number of calls, a 33 percent increase in visitors on their website, and a 100 percent increase in Google searches.40 The popularity of “1-800-273-8255” reflects the immense effect social media has on the lives of teenagers. Hopefully, Facebook’s efforts in using social media to address the rising suicide rate would bring similar, if not better, results.

CONCLUSION

Giving Facebook access to user information for the 6.8 million teenage users in the U.S. is a difficult and even controversial idea. 41 Furthermore, social media activity may not always be indicative of mental illness and could lead to misdiagnosis. Nevertheless, Facebook’s involvement in ensuring the mental health of the youth is a forward-thinking effort that may benefit all stakeholders in the long run. The targeted analytics program may greatly improve the mental health of communities around the world, starting with teenagers themselves.

As our world becomes increasingly dependent on technology and social media, our treatments for depression and suicide must be all the more effective. A collaboration between corporate and community stakeholders to profile, diagnose, and help depressed teenagers find the resources they need is the first, and perhaps most important, step for society to take to reduce the growing suicide rate. Many people call social media the future of tomorrow. It’s time for it to live up to that title.

CLASS OF 2021 • FINANCE & MANAGEMENT

“Suicide.” National Institute of Mental Health, U.S. Department of Health and Human Services, Apr. 2018, www.nimh.nih.gov/health/ statistics/suicide.shtml.

2 Holmes, Lindsay. “Suicide Rates For Teen Boys And Girls Are Climbing.” The Huffington Post, TheHuffingtonPost.com, 4 Aug. 2017, www.huffingtonpost.com/entry/suicide-rates-teen-girls_ us_59848b64e4b0cb15b1be13f4.

3 Ibid.

4 “Youth Suicide Statistics.” Parent Resource Program, <prp. jasonfoundation.com/facts/youth-suicide-statistics/>.

5 Tracy, Natasha. “Effects of Suicide on Family Members, Loved Ones Suicide.” HealthyPlace, May 2017, www.healthyplace.com/suicide/ effects-of-suicide-on-family-members-loved-ones/.

6 Survivors of Bereavement by Suicide. “How Suicide Affects Others.”

Survivors of Bereavement by Suicide, 2017, <uksobs.org/about/ suicide-bereavement/how-suicide-can-affect-you/how-suicideaffects-others/>.

7 Rogers, Catherine H., et al. “Long-Term Effects of the Death of a Child on Parents’ Adjustment in Midlife.” Journal of Family Psychology: JFP : Journal of the Division of Family Psychology of the American Psychological Association (Division 43), U.S. National Library of Medicine, Apr. 2008, www.ncbi.nlm.nih.gov/pmc/articles/ PMC2841012/.

8 “Suicide Data.” World Health Organization, World Health Organization, 20 Dec. 2017, www.who.int/mental_health/ prevention/suicide/suicideprevent/en/.

9 Depression and Bipolar Support Alliance. “Hotline Information.” Depression Statistics - Depression and Bipolar Support Alliance, <secure2.convio.net/dabsa/site/ SPageServer/?pagename=education_statistics_depression>.

10 Ibid.

11 Andrew Reece. “Signs of Depression Revealed by Social Media Photos.” Syslog, 28 Nov. 2017, www.spring.org.uk/2017/11/onlineimages-depression.php.

12 Reece, Andrew G, and Christopher M Danforth. “Instagram Photos Reveal Predictive Markers of Depression.” EPJ Data Science, Springer Open, 8 Aug. 2017, <epjdatascience.springeropen.com/ articles/10.1140/epjds/s13688-017-0110-z>.

13 Ibid.

14 Ibid.

15 Ibid.

16 National Cyber Security Alliance (NCSA). “Social Media Statistics | GuardChild.” Parental Control Software to Monitor Kids on Their Computers, Cell Phones, iPads and Tablets, www.guardchild.com/ social-media-statistics-2/.

17 “Suicide Data.” World Health Organization.

18 Wisdom, Jennifer P., et al. “What Teens Want: Barriers to Seeking Care for Depression.” Administration and Policy in Mental Health, U.S. National Library of Medicine, Mar. 2006, www.ncbi.nlm.nih. gov/pmc/articles/PMC3551284/.

19 Ibid.

20 eMarketer; Adweek. “Number of U.S. Social Network Users by Age 2018 | Statistic.” Statista, Jan. 2018, https://www.statista.com/ statistics/398136/us-facebook-user-age-groups/.

21 Yarow, Jay. “SNAPCHAT: We’ve Turned Over A Dozen Unopened Snaps To Law Enforcement.” Business Insider, Business Insider, <www.businessinsider.com/snapchat-weve-turned-over-a-dozenunopened-snaps-to-law-enforcement>.

1

“Third Suicide of Year Casts Shadow At Plano Senior High.” CBS Dallas / Fort Worth, CBS Dallas / Fort Worth, 5 June 2017, <dfw. cbslocal.com/2017/06/05/third-suicide-of-year-casts-shadow-atplano-senior-high/>.

23 Jin, Xiao. Personal interview. 3 Mar. 2018.

Guo, Yingshan. Personal interview. 3 Mar. 2018.

24 Leventhal, Barry. “An Introduction to Data Mining and Other Techniques for Advanced Analytics.” Springer Link, Palgrave Macmillan UK, 28 Oct. 2010, link.springer.com/ article/10.1057%2Fdddmp.2010.35.

25 Dr. Kulthida, Tuamsuk and Tipawan, Silwattananusarn. “Data Mining and Its Applications for Knowledge Management.” https://Arxiv. org/Ftp/Arxiv/Papers/1210/1210.2872.Pdf. 26 Confessore, Nicholas. “Cambridge Analytica and Facebook: The Scandal and the Fallout So Far.” The New York Times, The New York Times, 4 Apr. 2018, www.nytimes.com/2018/04/04/us/politics/ cambridge-analytica-scandal-fallout.html.

27 Hsu, Tiffany. “For Many Facebook Users, a ‘Last Straw’ That Led Them to Quit.” The New York Times, The New York Times, 21 Mar. 2018, www.nytimes.com/2018/03/21/technology/users-abandonfacebook.html.

28 Henninger, Daniel. “Is Facebook a Frankenstein?” The Wall Street Journal, Dow Jones & Company, 28 Mar. 2018, www.wsj.com/ articles/is-facebook-a-frankenstein-1522273843.

29 Seetharaman, Deepa. “Facebook Posts Surge in Revenue as It Tackles User-Data Crisis.” The Wall Street Journal, Dow Jones & Company, 26 Apr. 2018, www.wsj.com/articles/facebook-reports-higherrevenue-earnings-1524687694.

30 Ibid.

31 Ibid.

32 Ibid.

33 The Times Editorial Board. “Facebook Finally Steps up on Privacy.

Now It’s Congress’s Turn.” Los Angeles Times, Los Angeles Times, 6 Apr. 2018, www.latimes.com/opinion/editorials/la-ed-facebookprivacy-rights-20180406-story.html.

34 Ibid.

35 Ibid.

36 Ibid.

37 Kramer, Michael E. Porter Mark R., et al. “Creating Shared Value.”

Harvard Business Review, 25 Aug. 2015. Web. 24 Apr. 2017. <https:// hbr.org/2011/01/the-big-idea-creating-shared-value>.

38 Anderson, Monica. “Parents, Teens and Digital Monitoring.”

Pew Research Center: Internet, Science & Tech, 7 Jan. 2016, www.pewinternet.org/2016/01/07/parents-teens-and-digitalmonitoring/.

39 “Logic Chart History.” Billboard’s Hot 100, BillBoard, 29 Apr. 2018, www.billboard.com/music/Logic/chart-history/hot-100.

40 Rubin, Rebecca. “Thanks to Logic’s Song, the Phones at ‘1-800-2738255’ Are Ringing Off the Hook.” Variety, 29 Jan. 2018, variety. com/2017/music/news/1-800-273-8255-logic-song-suicideprevention-lifeline-1202542381/.

41 eMarketer; Adweek. “Number of U.S. Social Network Users by Age 2018 | Statistic.”

22

Photo Credits: Burst/Pexels—page 18 rawpixel.com/Pexels—page 20

THE SOCIAL NETWORK: USING SOCIAL MEDIA TO TACKLE TEEN SUICIDE / 23

Cassava as Currency:

THE PLANT THAT CAN PROVIDE AN EDUCATION ESSAY BY

RAFAELA LAITAMAKI

Uncontrolled urbanization has increased income inequality in Ghana, making it even harder for rural residents to afford education. Author Rafaela Laitamaki suggests that Omega Schools has the potential to help remedy this problem by altering its payment model to accept cassava as currency in exchange for access to education.

S

weat pours down abina’s face as she desperately tries to start a fire out of a few twigs and dried leaves. When finally successful, she pours contaminated lake water and three cassava roots into a rusted pot. Her six children crowd around as she smashes the cooked roots in a wooden bowl with an oversized stick. Although just a glimpse into Abina’s daily routine, this is the harsh reality for millions of rural residents in Ghana: working tirelessly to grow cassava as a source of food and income, yet unable to earn enough money (cedis) to cover public school fees for their children. Cassava can only be sold twice a week at the nearest market, nearly 40 minutes away and only accessible by motorbike. The reality of rural residents in Ghana is grim; their children will not complete their primary education and build better lives for themselves because families cannot afford public school fees.1 However, this harsh reality can be changed through Omega Schools, a chain of low-cost private schools in Ghana.

For poor rural residents in Ghana, limited access to education is a persistent problem exacerbated by uncontrolled urbanization. Over the past two decades, while urbanization drove rapid economic growth, rural areas were left behind and income inequality increased.2 Access to education for rural residents has been hindered by urbanization as subsequent rising prices make school fees more unaffordable.3 The Ghanaian government has not taken adequate action to mediate unequal access to education, but businesses such as Omega Schools have stepped in.

Omega Schools has attempted to improve access to education by introducing a daily fee system that accommodates families who cannot pay large sums of money. However, Omega Schools has not provided affordable education for poor rural residents like Abina because Omega’s current fee structure is beyond its budget. A new fee system that allows rural residents to utilize the resources they have would allow Omega Schools

26 / RAFAELA LAITAMAKI

to provide an affordable education for Abina’s children and thousands of other children like them. To do so, the business can modify its fee structure to meet the needs of rural residents by accepting a new form of payment: cassava.

Currently, Omega Schools utilizes a unique “Pay as You Learn Model” where parents pay an all-inclusive daily fee of 1.50 Ghanaian cedis, approximately $0.75, which includes uniforms, a school bag, work books, and a hot lunch.4 In contrast, students in government sponsored public schools pay larger monthly or term fees.

Unfortunately, most families cannot save enough money to pay public school fees because they can only sell products in local markets or harvest local crops, making their incomes unpredictable.

As a result, there are high dropout rates in Ghanaian schools, with the primary reason being a lack of financial resources.5 Ultimately, Omega Schools helps combat this problem through its “Pay as You Learn Model,” which improves access to education—specifically for students whose families can pay fees only when their seasonal income allows.

The Omega School chain is able to provide students in 38 schools with a more affordable education while generating a profit because the business hires senior high school graduates. Omega School teachers receive lower salaries than trained teachers because they have completed less schooling, but Omega teachers are given additional resources that compensate for their inexperience.

All teachers complete one week of preservice training in addition to two or three days of training throughout the school year. Furthermore, Omega teachers follow detailed daily lesson plans created by experienced education specialists for every grade and subject.6 With this “School in a Box” approach, Omega teachers are more than well prepared: evaluations reveal that their students perform 15 to 21 percent better on English tests than public school students.7 With its standardized education process, Omega is able to utilize its generated profits to build new schools, with the

aim to serve 200,000 students by 2021.8 Although Omega Schools plans on scaling its business, it will struggle to reach the lowest-income individuals in Ghana with its current fee structure.

According to the Omega Schools mission statement, “Omega Schools… are benefiting the poor and empowering aspirations of low-income families and their communities.”9 However, in reality, the Omega Schools chain is not helping poor rural residents like Abina who are largely left out of the formal economy.

All Omega Schools are located in Greater Accra and central regions of Ghana; there are no schools in remote rural villages where poverty is most prevalent.10 In 2016, rural poverty was almost four times as high as urban poverty, demonstrating that school fees are less affordable for rural residents.11 Omega has not opened schools in these rural areas because its current fee structure is infeasible for most rural residents—on average, the lowest-income families in Ghana would need to pay 40 percent of their income to afford the daily fee.12 Experts in the education field have questioned the impact of Omega Schools and argue that the chain only provides education for those who can already afford to pay, rather than extending access to the “most marginalized.”13 Co-founder James Tooley stated that “if the brand name of a private school is undermined, then the company will go out of business,” yet these criticisms are doing just that.14 To restore its brand name, Omega Schools needs to expand its reach before the business loses more credibility. In 2012, 50 percent of poor people in Ghana had not received an education, but Omega Schools has the potential to drastically improve access to education, particularly for poor rural residents.15 In order to fulfill its mission statement and preserve its brand, Omega Schools should begin accepting an alternative form of payment for education: cassava.

Instead of charging 1.50 Ghanaian cedis per day, Omega Schools can accept cassava—a locally grown, starchy root vegetable—from rural residents and use the same crop to prepare hot lunches for

students. The daily fee for Omega Schools includes a hot lunch, but the business would not need to source ingredients from other providers with this alternative payment. Instead, families that grow cassava can pay a reduced fee and provide a specific amount of cassava to the school each day to compensate for the lower daily fee. This structure would allow Omega Schools to continue preparing lunches for students while allowing more families to send their children to school.

Rural residents have extremely limited access to cedis but a surplus of cassava, a potential benefit for Omega Schools. In Ghana, approximately 70 percent of all farmers are involved in the cultivation of cassava, with smallholder farmers in rural areas accounting for more than 90 percent of its production. The farmers in these rural areas use cassava to feed their family, but they still have a surplus of 30 to 40 percent after all personal use. The excess is often wasted because families can only trade cassava with neighbors or sell the crop in local markets.16 Neither method is ideal: cassava can only be bartered rather than traded for cedis, and infrequent methods of transportation limit its access to local markets.17 Thus, there is an opportunity for Omega Schools to strengthen local clusters of cassava suppliers by helping farmers make the most of their output.18 Accepting cassava as payment for education would also benefit Omega Schools. The organization has provided hot lunches for students since the business began in 2008, and with this new fee structure, they would be able to boil, mash, or fry cassava to make lunches.

Cassava is an integral component of Ghanaian dishes because it is the number one crop produced and consumed in Ghana. Its value makes it the perfect alternative form of payment.19 By utilizing cassava from local farmers, Omega Schools can help rural residents use their extra cassava to pay for their childrenâ&#x20AC;&#x2122;s education and simultaneously bolster its own reputation at no extra cost.

Ultimately, helping the 36 percent of rural children who have never entered

OCEANIC PLASTIC POLLUTION SOLVED: COLLECTION, RECYCLING, REPURPOSING / 27

school afford an education provides more people the necessary skills and knowledge needed for higher paying jobs.

These educated rural students can receive higher incomes and utilize their learning to improve the community in a variety of ways.20 Furthermore, as the community develops, even more rural residents will be able to afford the daily fee for Omega Schools, which will in turn grow the business. Overall, this new fee structure will create a positive cycle of economic and social development that benefits the Omega School chain as well as the villages they operate in.21 To create this mutually beneficial cycle of economic and social development, Omega Schools only needs to make minor adjustments to their business model. Currently, the daily fee structure includes a hot lunch, an expense already factored into Omegaâ&#x20AC;&#x2122;s cost structure.

The meal system is already in place, and with extra cassava readily available, the Omega School chain needs to redefine value in their supply chain.22 Previously,

Omega Schools viewed cedis as the only method of payment, but viewing cassava as currency provides additional value for their business.

In order to effectively implement this alternative fee structure and fulfill its mission statement, Omega needs to open schools in rural areas. Omega Schools is already planning on expanding its reach, so the chain clearly has the ability to scale.23 With this new fee structure, the business can extract additional value by reaching out to more rural areas. Thus, Omega Schools can improve its business and extend the scope of its impact while transforming how low-cost private schools approach value and profit. Omega Schools can also set an example for lowcost private schools around the world by demonstrating that rural residents have valuable resources other than physical currency that businesses can utilize to create shared value. No other school currently tailors its fee system to overcome the constraints rural residents face while also providing high quality

education; Omega Schools is positioned to do just this.

This unique value proposition sets Omega Schools apart and provides it with the opportunity to enter an underserved market while generating profit and positive change. In 2008, when James Tooley and Ken Donkoh created Omega Schools, they hoped to empower the poorest individuals in Ghana by providing low-cost education. 24 Today, Omega Schools finally has the opportunity to truly accomplish this mission. By reconceiving private education and educational currency, Omega Schools can create shared value for its business and poor rural communities.25 In Ghana, limited access to education for the lowestincome individuals is a challenge that businesses and governments have yet to solve. However, Omega Schools has the power to address this problem by accepting a new currency: cassava.

“

By reconceiving private education and currency, Omega Schools can create shared value for its business and poor rural communities.”

Laitamaki, Rafaela, Abina, Vida, and Rejoice. “Interview with Local Villagers.” 12 Mar. 2018.

2 Mollini, Vasco; Paci, Pierella. 2015. Poverty Reduction in GhanaProgress and Challenges: Overview. Ghana in Brief;. World Bank, Washington, DC. copyright World Bank. https://openknowledge. worldbank.org/handle/10986/22733 Licence: CC BY 3.0 IGO. 3 Molini. Poverty Reduction, p. 41.

4 “Center for Education Innovations.” Omega Schools | Center for Education Innovations, 1 Jan. 2015, www.educationinnovations.org/ program/omega-schools.

5 Education in Ghana. World Bank Group, 23 Feb. 2010, openknowledge.worldbank.org/bitstream/ handle/10986/3012/597550Revised00elivery0March0902011. pdf?sequence=6&isAllowed=y.

6 Our Pay-As-You-Learn™ Model - Omega Schools, www.omega-schools. com/payl-model.php.

7 “Profile: Omega Schools.” World Bank Group, 2015, doi:https://www. innovationpolicyplatform.org/system/files/01%20Edu_Profile%20 Omega.pdf.

8 “Omega Schools.” Wise Qatar, 2018, www.wise-qatar.org/omegaschools-ghana.

9 Over & Mission - Omega Schools, www.omega-schools.com/overview. php.

10 Ibid.

11 Cooke, Edgar, et al. “The Ghana Poverty and Inequality Report.”

Unicef, Mar. 2016, page 1, doi:https://www.unicef.org/ghana/ Ghana_Poverty_and_Inequality_Analysis_FINAL_Match_2016(1). pdf.

12 Riep, Curtis B. “Omega School Franchise in Ghana: A Case of ‘Low Fee’ Private Education for the Poor or for-Profit Profiteering?”

Open Society Foundations, 2015, page 20–21., doi:http://www.

1

RAFAELA LAITAMAKI

periglobal.org/sites/periglobal.org/files/WP63%20Omega%20 Schools%20Franchise%20in%20Ghana.pdf.

13 Riep. “Omega School,” p. 26.

14 Tooley, James. “Lessons from Private Education in Developing Countries.” The Global Education Industry, Apr. 1999, page 22, documents.worldbank.org/curated/en/134581468178162812/pdf/ multi-page.pdf.

15 Molini, Vasco, and Pierella Paci. Poverty Reduction in Ghana. Page 31.

16 “Market Opportunities for Commercial Cassava in Ghana, Mozambique, and Nigeria.” Grow Africa, June 2015, page 20.

17 “Market Opportunities.” Grow Africa, p. 25.

18 Porter, Michael E, and Mark R Kramer. “Creating Shared Value.”

Harvard Business Review, 2011, page 72-73, drive.google.com/ drive/u/0/search?q=porter%20and%20kramer.

19 Agriculture in Ghana. Ministry of Food and Agriculture, Oct. 2016, page 12, www.agrofood-westafrica.com/fileadmin/user_upload/ messen/agrofood-Westafrica/Brochure/AGRICULTURE-INGHANA-Facts-and-Figures-2015.pdf.

20 “Out Of School Children.” Unicef, 4 Apr. 2015, www.unicef.org/ghana/ REALLY_SIMPLE_STATS_-_Issue_4(1).pdf.

21 Porter. “Creating Shared Value.” HBR, p. 72-73.

22 Porter. “Creating Shared Value.” HBR, p. 68-70.

23 “Omega Schools.” Wise Qatar, 2018, www.wise-qatar.org/omegaschools-ghana.

24 Our Board - Omega Schools, www.omega-schools.com/overview.php.

25 Porter. “Creating Shared Value.” HBR, p. 67.

Photo Credits: Roots, Tubers and Bananas/Flickr—page 24 CIAT/Flickr—page 27 Norma Morgan/Flickr—page 28 JIRCAS Library/Flickr—page 29

CLASS OF 2021 • FINANCE & SUSTAINABLE BUSINESS

I spent my spring break helping develop microbusinesses in a Ghanaian village with Stern International Volunteers and was inspired to continue researching the country’s education system after I returned. After discovering that Ghana has a surplus of cassava and witnessing firsthand the importance of this food staple to family life, I proposed a way for this starchy vegetable to serve another purpose: furthering children’s education.

CASSAVA AS CURRENCY: THE PLANT THAT CAN PROVIDE AN EDUCATION / 29

CLEANING

CRYPTO:

HOW TO ACHIEVE ENVIRONMENTAL

SUSTAINABILITY IN BITCOIN MINING ESSAY BY

BLAKE HEKMATPOUR

Bitcoin mining is projected to use more electricity than the entire world does today, which may lead to unprecedented environmental degradation. Blake Hekmatpour proposes a merger of operations between Bitmain, the worldâ&#x20AC;&#x2122;s flagship cryptocurrency mining company, and Hydrominer, an Austrian firm with expertise in hydropower, to decrease Bitcoinâ&#x20AC;&#x2122;s carbon footprint.

M

any have heard of Bitcoin, but few can comprehend the technology behind it.

While “Bitcoin” and “blockchain” have become buzzwords among students and professionals, the number of people that “mine” or maintain the Bitcoin blockchain remains incredibly small. Yet the amount of electricity required to power Bitcoin’s explosive growth is increasingly worrisome.

Bitcoin miners generate “bitcoins” by creating blocks of valid transactions and affirming these transactions onto the blockchain’s public ledger. By solving complex mathematical problems through hashing algorithms, certain mining nodes are randomly awarded 12.5 bitcoins every 10 minutes. This concept is known as proof-of-work (PoW).1 Unlike PoW, proofof-stake (PoS) correlates the number of coins owned by an entity to its mining capability. In doing so, PoS and a number of additional consensus algorithms for distributed systems are more scalable and energy-efficient than the PoW system used by Bitcoin.2 PoW requires significant “hashing,” or computational power.

As the number of bitcoins awarded for each block halves every four years, the amount of energy needed for Bitcoin mining increases. And as the difficulty of Bitcoin mining and the number of people utilizing Bitcoin multiplies, the potential for environmental collapse only grows.

The Bitcoin Energy Consumption Index, an analytical tool that measures various metrics associated with Bitcoin miners, discovered that Bitcoin currently consumes 62.24 terawatt hours of electricity and produces a carbon footprint of 30,495 kilotons of carbon dioxide annually.3 As of December 2017, Bitcoin mining consumed as much electricity as the country of Serbia. By November 2020, it is projected to “use more electricity than the entire world does today.” 4 These statistics refer solely to Bitcoin mining and not the mining of additional cryptocurrencies.

Since Bitcoin’s market capitalization accounts for just 38% of the entire

32 / BLAKE HEKMATPOUR

crypto market,5 the energy consumption of other cryptocurrencies poses even broader consequences. A merger between technology and renewable energy serves as the sole alternative for the protection of the environment from the harmful effects of Bitcoin’s continued growth.

Theoretically, Bitcoin functions on millions of individual computer nodes worldwide; in reality, however, the power used is much more concentrated. Bitmain, the world’s flagship cryptocurrency mining company and developer of the Antminer S9—the most power-efficient, consumer-grade miner—has nearmonopolistic control on the industry.

As the most popular mining hardware company, Bitmain influences most of the processing innovation in the space. More importantly, Bitmain operates the mining pools Antpool and BTC.COM.6 Mining pools lower revenue variance for miners by pooling computing power and then proportionally distributing rewards when successful blocks are mined.7 Bitmain acts as the fund manager of Antpool and BTC. COM, so the firm takes a commission on all profits. Via its subsidiary mining pools, Bitmain accounts for approximately 29 percent of all global hashing power.8 How e ve r, B i t m a i n o p e r a t e s i n China, a coal-reliant economy, and the energy demands of Bitcoin mining are projected to increase given the current consensus algorithm. As a result, Bitcoin mining will consume an exponentially increasing amount of non-renewable energy, benefitting a very select few while decimating the world environment for all.

The impact of Bitcoin mining extends beyond the digital realm and into the physical. Bitmain and most other mining companies conduct business in China due to its cheap, government-subsidized, coalpowered electricity. 9 Bitcoin’s carbon footprint due to coal-burning severely harms the environment, however.

According to Greenpeace, coal is “the single largest source of climate-changing pollution” because burning it “creates millions of tonnes of waste products that contain toxic levels of heavy metals and minerals.”10 Scientists and researchers

not only consider coal the worst fossil fuel because of its climate repercussions; they also find its burning as one of the most detrimental processes to collective human health.11 Contrary to the stakeholder model proposed by R. Edward Freeman, members of the Bitcoin community make improper tradeoffs that strip, rather than capture, value from the rest of society.12 Though bitcoin miners focus almost exclusively on profit margins, an opportunity exists to create shared value for the greater global community.

Clean, renewable energy for Bitcoin mining exists, but currently not in China.

Bitmain’s strong presence in the Chinese economy and the firm’s comfort with navigating the subsidized electricity hubs owned by the Communist Party (CPC) make it difficult to incentivize the development of new and sustainable solutions. Therefore, a strategic merger between Bitmain and Hydrominer, an Austrian cryptocurrency mining firm with proprietary technology and expertise in hydropower, could alleviate the potential infrastructure headaches for Bitmain while drastically decreasing Bitcoin’s carbon footprint in the long-run.13 As the first-to-market in cryptocurrency hydro-mining and the largest Bitcoin mining company in the world, Hydrominer and Bitmain each offer capabilities that will not only mutually strengthen their own business models but also provide for the overall well-being of society as well.

H y d r o m i n e r ’s s p e c i a l i z e d infrastructure, deployment tactics, and proprietary cooling system, for instance, allow for higher profit margins without the use of coal.14 Its server-based shipping containers, software near power stations, and cooling systems using Alpine currents allow the company to mine cryptocurrency sustainably. 15 If Bitmain incorporates this technology into its existing infrastructure, then its monopolistic position will send a powerful market signal to other mining entities to adopt similar practices. Hydrominer will also benefit by gaining brand recognition

“

Bitcoin mining will consume an exponentially increasing amount of non-renewable energy, benefiting a very select few while decimating the world environment for all.”

REINVENTING WHOLESOME / 33

and attracting new retail or corporate clients to use its service. Under this initiative, all three parties win: Bitmain reduces electricity costs and increases profit margins, Hydrominer grows its revenue stream, and society enjoys the benefits of a cleaner and healthier environment.

The viability of such a merger is strong given the economic incentives provided to both firms. Hydrominer’s current initial coin offering (ICO) titled H2O acts as a voucher for mining time in existing Hydrominer facilities. Furthermore, with its second ICO named H3O, Hydrominer has the necessary capital to build more proprietary mining facilities across the world.16 By incorporating a Hydrominer plug-in onto the interfaces of Antpool and BTC.COM, Bitmain will be able to purchase these tokens and thereby utilize Hydrominer’s advantageous services.

The purchase of such ICOs will not only provide Bitmain with the most efficient and effective transfer of capital but also increase Hydrominer’s market value.

As a hardware provider, Bitmain can supply actual miners to Hydrominer, which will then modify the miners according to its renewable energy solution.17 Moreover, the success of this project could have trickle-down benefits by encouraging other cryptocurrency mining pools across the world to follow their example. By spearheading this effort, Bitmain and Hydrominer could recapture the lost social value found in environmental degradation from Bitcoin mining, thereby attending to the needs of

34 / BLAKE HEKMATPOUR

each business and society as a whole.

Beyond the validity and scalability of this merger, the environmental benefits from transitioning to more renewable energy also make this proposal favorable.

Because the PoW algorithm governing the Bitcoin blockchain is immutable and inefficient, the only way Hydrominer and Bitmain can tackle the issue of increasing carbon emissions and energy usage is by transitioning to renewable energy. With aligned economic incentives and the possibility for a healthier, more energyefficient society, Hydrominer and Bitmain have the opportunity to create shared value that is both viable and desirable.

As noted by NYU professors Wiesenfeld and Statler, firms make organizational design decisions by deciding “ how quickly and sustainably they can achieve their founding purpose.”18 The key word here is “sustainably:” while the current business model of Bitcoin miners does not incorporate sustainable practices, a new partnership between two key players in the Bitcoin mining space will help create shared value and thus unleash sustainable growth and innovation in this increasingly popular space.19 In 2017 alone, the value of the cryptocurrency market ballooned from $18.3 billion to nearly $600 billion. 20 Despite the rapid increase in market capitalization, cryptocurrencies and the underlying blockchain technology are still in their early stages. Consensus algorithms like PoW and PoS will likely undergo thousands of iterations of redevelopment as computer hardware

processing power increases and more energy-efficient algorithms are encoded into the blockchain. However, as the utility, usability, and scalability of Bitcoin and other cryptocurrencies rise over the coming years, the electricity needed to power such mining processes could easily surpass the amount predicted by current models.

Ve r y f e w p e o p l e f o r e s a w t h e explosion of cryptocurrencies; even fewer understand the environmental implications of current mining processes now. Still, the merger of operations between Bitmain and Hydrominer is a crucial determinant of the environmental sustainability of cryptocurrencies as a whole. Their partnership will not only expand the triple bottom line of each firm but also encourage sustainable replication across other tokens later on. Ultimately, such a partnership will advance blockchain innovation while protecting the means and ends of such innovation. By creating shared value in this ecosystem, cryptocurrency businesses can continue growing at unprecedented rates while simultaneously protecting the values and health of the general community.

Acheson, Noelle. “How Bitcoin Mining Works.” CoinDesk.com, CoinDesk, 29 Jan. 2018, www.coindesk.com/information/howbitcoin-mining-works/.

2 King, Sunny, and Scott Nadal. “PPCoin: Peer-to-Peer Crypto-Currency with Proof-of-Stake.” 19 Aug. 2012, pp. 01–06., pdfs.semanticscholar. org/0db3/8d32069f3341d34c35085dc009a85ba13c13.pdf.

3 “Bitcoin Energy Consumption Index.” Digiconomist, digiconomist. net/bitcoin-energy-consumption.

4 Rogers, Adam. “The Hard Math Behind Bitcoin’s Global Warming Problem.” Wired, Conde Nast, 1 Feb. 2018, www.wired.com/story/ bitcoin-global-warming/.

5 “Cryptocurrency Market Capitalizations.” Cryptocurrency Market Capitalizations | CoinMarketCap, 26 Apr. 2018, coinmarketcap. com/.

6 “Asic Bitcoin Mining Hardware from Bitmain.” Bitmain.com, Bitmain Technologies, 2018, www.bitmain.com/.

7 Bonneau, Joseph, et al. “SoK: Research Perspectives and Challenges for Bitcoin and Cryptocurrencies.” pp. 1–18. Princeton University, wws.princeton.edu/system/files/research/documents/Felten_SoK. pdf.

8 Pollock, Darryn. “Bitmain’s Mining Monopoly Compromises Bitcoin’s Decentralized Nature.” Cointelegraph, Cointelegraph, 30 Aug. 2017, cointelegraph.com/news/bitmains-mining-monopolycompromises-bitcoins-decentralized-nature.

9 Swanson, Tim. “Bitcoins: Made in China.” Ofnumbers.com, pp. 1–14., www.ofnumbers.com/wp- content/uploads/2014/05/BitcoinsMade-in-China.pdf.

10 “The Problem of Coal: in China.” Greenpeace East Asia, Greenpeace, 2012, www.greenpeace.org/ eastasia/campaigns/climate-energy/ problems/coal/.

1

BLAKE HEKMATPOUR

Ebnesajjad, Sina. “Why Is Coal the Worst Fossil Fuel – Emissions, Climate, Health, Smog...?” Chemical R&D | Chemical R&D, Elsevier, 15 May 2017, chemical-materials.elsevier.com/chemical-rd/coalworst- fossil-fuel-emissions-climate-health-smog/.

12 Freeman, R. Edward. “Managing for Stakeholders.” SpringerLink, Palgrave Macmillan UK, 30 July 2008, dx.doi.org/10.2139/ ssrn.1186402.

13 “Hydromining.” Hydrominer, 2018, www.hydrominer.org/ hydromining/.

14 Ibid.

15 Tirone, Jonathan. “This Cryptocurrency Miner Says It Solved Bitcoin’s Power Problem.” Bloomberg.com, Bloomberg, 16 Nov. 2017, www.bloomberg.com/news/articles/2017-11-16/thiscryptocurrency-miner-says-it-solved-bitcoin-s-power-problem.

16 Damblon, Nadine. “Update of the H3O Token Sale.” Medium, Hydrominer, 7 Jan. 2018, medium.com/@nadine_3242/update-ofthe-h3o-token-sale-2800ffe2bab.

17 Brandenberger, Adam. “Strategy Needs Creativity.” 7 Jan. 18AD, pp.

01–11.

18 Wiesenfeld, Batia M., and Matt Statler. “Market, State, and Community: A Dynamic Three-Sector Model of Societal Institutions .” pp. 01–08.

19 Porter, Michael E., and Mark R. Kramer. “Creating Shared Value.”

Harvard Business Review, 2011, pp. 62–77.

20 “Cryptocurrency Market Capitalizations.” Cryptocurrency Market Capitalizations | CoinMarketCap, 26 Apr. 2018, coinmarketcap. com/.

Photo Credits: Marko Ahtisaari/Flickr—page 30 Crypto360/Flickr—page 33 Dmitry Horov/Flickr—page 34 11

CLASS OF 2021 • FINANCE & DATA SCIENCE

I began trading Bitcoin and other cryptocurrencies in early 2016. After the explosion in Bitcoin’s price and its wide press coverage in mid-2017, I decided to delve deeper into the actual mining process only to find that its energy consumption will soon be unsustainable. With this paper, I am pushing for innovation in the cryptocurrency space, focusing particularly on its environmental impact.

CLEANING CRYPTO: HOW TO ACHIEVE ENVIRONMENTAL SUSTAINABILITY IN BITCOIN MINING / 35

Fewer Painkillers,

More Profits: ENDING AMERICAâ&#x20AC;&#x2122;S

OPIOID CRISIS ESSAY BY

Opioid overdoses are now the leading cause of death for Americans under 50. The communities that have been hardest-hit are often rural manufacturing ones. This solution proposes a partnership between Invidior and Groups to expand access to life-saving drug Suboxone to rural areas.

WHITNEY DANKWORTH

O

pioid overdoses are now the leading cause of death for Americans under 50. 1 This statistic should not come as a surprise— most Americans have heard news reports about increasing overdose rates lately— but few have heard as many as Ohioans.

For them, it is impossible to watch local news without hearing about overdoses, and for good reason. In 2015, Ohio’s overdose rate was 35.9 per 100,000 people, which is nearly double the national rate of 19.1 and almost 10 times Ohio’s overdose rate in 1999. While Ohio is one of the hardest-hit states, the opioid problem is national: last year alone, 64,000 people died of opioid overdoses across the country.2 A combination of questionable business practices and loose government insight created the problem. But now, business can end the crisis.

HISTORY OF THE CRISIS

Purdue Pharmaceuticals and Oxycontin In 1993, Purdue Pharmaceuticals was looking to maintain revenues as its 1972 patent on extended-release morphine, MS Contin, was about to expire. Worried that its flagship product was about to lose its monopoly, Purdue realized it could apply its extended-release technology to another old and widely-accepted opioid: oxycodone.

With this new patented product, OxyContin, Purdue began its marketing scheme. Loose laws and regulations for pharmaceutical marketing made breaking the rules appealing, with seven-figure fines offsetting ten-figure profits.3 In other words, Purdue had every incentive to make false claims. It paid researchers to publish reports declaring that OxyContin was “addiction free,” sent sales representatives to convince doctors of this falsehood, and lobbied the government to require doctors to prescribe OxyContin, claiming that leaving patients in pain was inhumane.4 Purdue Pharma’s false marketing and lobbying caused opioid prescriptions— especially those for OxyContin—to skyrocket, planting the seeds of today’s

opioid crisis.

Fentanyl Ten years later, in the late 2000s, policymakers began to recognize that a staggering number of people were addicted to opioids. Rather than focus on treating existing addicts, these lawmakers introduced policies to prevent others from becoming addicted. As Dr. Jeffrey Milks, former Director of Geriatric Fellowship at an Ohio hospital describes, these new policies regulated opioid prescriptions by forcing pain clinics to register with states and shutting down “pill mills,” where doctors distributed opioids for illegitimate purposes to collect prescription fees. In other words, these policies made getting opioid prescriptions much more difficult, which limited legal drug access to hundreds of thousands of existing opioid addicts. While their medication disappeared, their addiction did not. As a result, many of these addicts turned to street heroin.

After the heroin switch, the opioid crisis turned much more lethal. Between 2010 and 2014, heroin overdose deaths increased by 248 percent. 5 Worsening the problem was the influx of fentanyl: a cheap, Chinese-made, synthetic opioid 100 times stronger than heroin. While heroin is only semi-synthetic, requiring material from highly controlled opium poppies, fentanyl is completely synthetic, making it much cheaper and easier to produce. Dealers began to combine heroin with fentanyl to give customers a stronger high, but because the lethal dose of fentanyl is only the size of few grains of sand, as the number of addicts shot up, so did the death toll.

LARGER TREND: GLOBALIZATION

Globalization, another significant national trend, made the situation even worse. As production jobs moved abroad, middle- and lower-class incomes fell.

Not surprisingly, the communities that were hurt most by globalization were the same ones hit hardest by the opioid crisis: rural communities with vanishing manufacturing industries. Indeed, there

is a statistically significant, positive correlation between 2010 unemployment rates and 2015 opioid overdose rates.6 As the authors of the Ohio State study Taking Measure of Ohio’s Opioid Crisis reveal, this crisis is a story of “deaths of despair.” Rural residents, especially those who lost employment in a previously thriving industry, can remember a time when their parents or grandparents could achieve “success” with only a high-

“

more likely to experience opioid abuse, addiction, and overdose. Therefore, a long-term solution to the crisis must not only curb opioid addiction rates but also revitalize the hardest-hit communities in America.

THE COST OF THE CRISIS

The opioid crisis has placed the hardesthit communities in a positive feedback loop with negative consequences. As

naloxone auto-injectors that cost up to $2,250 each—a cost that is draining already limited resources and raising citizens taxes. 8 In some parts of Ohio, firefighters respond to more overdoses than fires. Overdose-related 911 calls have become so common now that Middletown, Ohio City Councilman Dan Picard suggested a three-strike system: 3 overdoses, no ambulance.9 While this policy will likely not be implemented, it

Current treatments like naloxone, while critical and lifesaving, are merely expensive band-aids covering a greater, untreated issue: addiction.”

school education. Now, the barrier to entry for most careers is a college degree, something seemingly unattainable for someone living in rural Ohio or West Virginia. And though globalization has benefitted America as a whole, the influx of cheap foreign labor has lowered prices and left some groups unemployed. Out of jobs and out of hope, these groups turned to drugs to escape.7 As these citizens and their communities continue to be neglected, the opioid crisis will only get worse.

Ohio State’s study confirms that those with fewer economic opportunities are

38 / WHITNEY DANKWORTH

poor economic conditions exacerbate the opioid epidemic, local governments spend more resources to help save lives. Their actions, however, only add to economic strains and make the crisis worse. For these communities, first responders shoulder the largest part of the burden, struggling to repair the damage as they drain public funds.

Most opioid overdoses can be treated with naloxone, a medication that blocks opioid receptors. The medication’s effects are dramatic, seemingly bringing patients back from death. Firefighters, police, and EMT workers, especially in Ohio, carry

draws attention to the burden imposed on first responders by the crisis, a burden also shouldered by society as a whole.

Altogether, the opioid crisis cost approximately $78 billion in 2013, with medical care and treatment costs comprising the largest percentage.

The second largest cost was losses in productivity due to overdose deaths, followed by losses in productivity of current opioid addicts.10 Beyond sheer economic cost, the cost of human life itself cannot be ignored.

Although economic studies measure overdose death costs by estimating

victims’ lifetime productivity lost, considering the crisis solely through an economic lens would ignore the intangible value of human life. As a nation, we value human life by outlawing murder, regulating abortion rights, and treating those with life threatening injuries even if they cannot afford it.

The opioid crisis is the leading cause of death for Americans under 50, and more Americans die each year to opioid

overdoses than in the entire Vietnam War.11 It’s time we found a solution.

TRIED AND FAILED SOLUTIONS

The opioid crisis is not the first drug epidemic to hit America. During previous epidemics, the nation has tried to implement a number of solutions— most of which have not worked.

Historically, one attempt to mitigate drug use has been to increase penalties for drug dealing and use. Richard Nixon rose to infamy for cracking down on drug use in response to the counterculture

movement. However, his “war on drugs” proved to be ineffective and was followed by two of America’s largest drug epidemics for crack cocaine and opioids. His policies, such as harsher sentences and mandatory minimums, have not been effective and will continue to be ineffective because drug addiction is not a criminal issue—it is a health issue.

On the opposite end of the spectrum are advocates for the legalization of all drugs. They argue that all drugs—even substances like heroin, methamphetamine, and crack—should be legalized and sold over-the-counter in controlled dosages. Supporters argue this would decrease overdoses because consumers would know exactly how much of a drug they are taking. However, legalizing drugs would increase their availability, which may lead to a higher number of addicts. A solution that increases the number of people addicted to drugs would only make that health issue worse. While enticing and simple, this libertarian solution is also not the answer to this crisis.

An effective solution to the opioid epidemic must reduce the social costs created by those addicted to and overdosing on opioids. Current treatments like naloxone, while critical and lifesaving, are merely expensive band-aids covering a greater, untreated issue: addiction. Ending this crisis means ending addiction, which leaves an opening for businesses to provide addiction treatment.

INDIVIOR: MAKING THE CRISIS RIGHT

America has exhausted nearly all of its options, but one remains untested on a large scale. Medication-assisted treatment has proven to be the most effective method, both in terms of results and cost, to end addiction and prevent overdose.12 Unfortunately, for those hit hardest by the crisis— those in bankrupt communities with minimal economic opportunity—treatment is neither available nor affordable. Ohio State’s study estimates that Ohio only had the

capacity to treat 40 percent of opioid addicts in 2012. Since then, the number of overdoses has increased while the number of treatment facilities has not.13 Developing more treatment facilities is the most crucial step in ending the opioid crisis. Indivior, manufacturer of Suboxone, one of the best treatment drugs for opioid addiction, is perfectly positioned to profit from ending the opioid crisis by expanding availability of medication-assisted treatment.

There are two main treatment drugs for opioid addiction: methadone and buprenorphine. These drugs decrease the effects of withdrawals by fooling the brain into thinking it has consumed opioids. They also block the full effect of opioids so that patients are unlikely to feel additional effects if they consume them. Because these treatment drugs can also cause psychological and physical dependence, however, they are heavily regulated.

To deter abuse, current federal regulations deem that methadone must be provided in a supervised, daily-visit setting in a clinic specifically designed for methadone treatment. To access a methadone clinic, patients must drive to receive treatment, which can be a burden for addicts living in rural areas far from one of Ohio’s 22 methadone treatment centers. Buprenorphine, however, can be prescribed by doctors, so long as they undergo the necessary training. For that reason, buprenorphine is more readily available than methadone. What’s more, Suboxone, Indivior’s patented drug, combines buprenorphine and naloxone to decrease abuse potential. Using Ohio as a case study, Suboxone seems to be the ideal treatment drug, preferred to methadone for ease of prescription, and preferred to buprenorphine for lower potential for abuse.

Several counties in Ohio lack even one buprenorphine-certified doctor.

While major cities have high numbers of certified doctors, the crisis has hit rural areas the hardest, leaving an unfilled market for buprenorphine in these rural counties. Indivior can profit by tapping

FEWER PAINKILLERS, MORE PROFITS: ENDING AMERICA’S OPIOID CRISIS / 39

and expertise Groups needs to expand. A partnership between Groups and Indivior would be ideal in expanding access to buprenorphine-certified doctors.

For Indivior, providing Suboxone treatment to rural addicts would be a monumental challenge. It would not only have to fund physician training but also build a network of clinics across rural Ohio, Indiana, Kentucky, and West Virginia.

This process is slow and expensive, and Indivior’s patent for Suboxone expires in 2023. Groups, however, already has the existing infrastructure to help Indivior expand and increase its Suboxone sales; thus, a partnership with Groups could help bring about an end to the opioid crisis.

INDIVIOR + GROUPS: FIGHTING OPIOIDS TOGETHER

into that market in Ohio and in other hard-hit states like Indiana, Kentucky, and West Virginia.

Since Indivior makes Suboxone, the only patented combination of buprenorphine and naloxone, it can boost sales by providing free buprenorphine training to physicians in the hardest-hit areas of the opioid crisis. In Erie county, for instance, there are no buprenorphinecertified doctors. However, the county had a high 2015 overdose rate of 78 per 100,000.14 Brown county is in a similar situation, with no certified doctors and an overdose rate of 62 per 100,000. 15 Even in counties with certified doctors, buprenorphine access needs to be expanded. In Miami county, the overdose rate is 77 per 100,000, but there is only one doctor certified to prescribe buprenorphine. 16 This number is not nearly high enough, as current federal regulations limit doctors to only 30 patients a year, with 100 and 275 patient limits as attainable rewards over time.17 Furthermore, because estimating the total number of opioid addicts is difficult,

40 / WHITNEY DANKWORTH

researchers only measure overdoses.

Consequently, with so few certified doctors, such small patient limits, and so many addicts, these rural counties are the perfect market for expanded buprenorphine access. Other companies have also realized this and are working to exploit it.

Groups, a New York City based opioid treatment startup, has left methadone clinics behind in favor of partnering with doctors to prescribe buprenorphine.

Groups reimburses doctors who take the buprenorphine certification course, and for a fee of $65 a week, addicts receive group therapy and buprenorphine treatment. Most treatment centers serve only major cities, but Groups has clinics in rural areas across the country, serving a historically neglected patient base.

However, while operating in rural areas has many benefits—rural rent is low and doctors can be paid at an hourly rate— Groups is currently operating at a loss as it seeks to expand access to treatment.18 Indivior can capitalize on its profitable business model by providing the funding

A proper partnership should create value for all parties involved. If Groups and Indivior were to team up to end the opioid crisis, Indivior would benefit from increased sales, Groups would benefit from increased revenue and an easier expansion, and society would benefit from increased buprenorphine treatment availability. To execute this partnership, Indivior could first provide capital to Groups to finance its rapid rural expansion. This would increase Suboxone sales in the short- and long-term; most medication-assisted treatment lasts at least a year, and Groups could expand its market over time. Next, Indivior could sell Suboxone to Groups at a discounted rate. Groups would benefit because Suboxone is simply buprenorphine with a lower potential for abuse, and Indivior would enjoy higher sales. Groups could then continue providing its cost-effective treatment using Suboxone as the drug of choice. Finally, Indivior could use its marketing capabilities to boost Groups enrollment, further increasing sales for both. In the end, everyone benefits— Indivior profits from increased Suboxone sales, Groups profits from increased enrollment, and society benefits from the increased availability of medicationassisted treatment.

ASSUMPTIONS

The effectiveness of this plan hinges on two key assumptions. First, it assumes that Groups would agree to partner with Indivior. Second, it assumes that buprenorphine would not become a substitute for opioids—that is, that these clinics would not become next-generation “pill mills.” Since buprenorphine works by filling the same receptors as normal opioids, this is a significant concern.

While this threat is less dangerous with Suboxone, excessive and unmonitored buprenorphine prescriptions could lead to the same consequences as Oxycontin prescriptions in the ’90s and early 2000s.

To prevent this outcome, clinics should provide counseling services and monitor patients’ use of the medication. Groups already does this by administering urine tests to ensure that patients have stopped taking opioids while taking buprenorphine only as directed.19 So long as this standard remains, the danger of a “buprenorphine epidemic” would be averted.

CONCLUSION

Suboxone, combined with counseling and therapy, could be the drug that ends the opioid crisis. While Indivior is already positioned to profit from its production and distribution of this medication, a

Reynolds, Dean. “Overdoses Now Leading Cause of Death of Americans under 50.” CBS News, CBS Interactive, 6 June 2017, www.cbsnews.com/news/overdoses-are-leading-cause-of-deathamericans-under-50/.

2 Ibid.

3 Keefe, Patrick Radden. “The Family That Built an Empire of Pain.” The New Yorker, The New Yorker, 12 Dec. 2017, www.newyorker.com/ magazine/2017/10/30/the-family-that-built-an-empire-of-pain.

4 Sarpatwari, Ameet, et al. “The Opioid Epidemic: Fixing a Broken Pharmaceutical Market.” Harvard Law & Policy Review, vol. 11, no. 2, 2017, pp. 463–484.

5 Ibid.

6 Rembert, Mark, et al. Taking Measure of Ohio’s Opioid Crisis | AEDE. Swank Program in Urban-Rural Policy, 2017, aede.osu.edu/aboutus/publications/taking-measure-ohios-opioid-crisis.

7 Ibid.

8 Gupta, Ravi, et al. “The Rising Price of Naloxone - Risks to Efforts to Stem Overdose Deaths | NEJM.” New England Journal of Medicine, 8 Dec. 2016, www.nejm.org/doi/full/10.1056/NEJMp1609578.

9 Wootson, Cleve R. “One Politician’s Solution to the Overdose Problem: Let Addicts Die.” The Washington Post, WP Company, 30 June 2017, www.washingtonpost.com/news/to-your-health/wp/2017/06/28/acouncil-members-solution-to-his-ohio-towns-overdose-problemlet-addicts-die/?utm_term=.ad2c2ba19a71.

1

WHITNEY DANKWORTH

partnership with Groups would increase Suboxone’s availability and market share before Indivior loses its patent rights in 2023. This partnership would be profitable for both businesses and simultaneously help curb the opioid crisis.

While a longer-term solution involving government intervention may be needed to address the underpinnings of the opioid crisis—including America’s urban-rural divide and job loss from globalization—a partnership between Groups and Indivior can still be profitable, provide medication assisted treatment to rural areas, and save countless lives. At the moment, this is the best business can do.

Florence, Curtis S., et al. “The economic burden of prescription opioid overdose, abuse, and dependence in the United States, 2013.”

Medical care 54.10 (2016): 901-906.

11 Ibid.

12 Rembert, Mark, et al. Taking Measure of Ohio’s Opioid Crisis | AEDE. Swank Program in Urban-Rural Policy, 2017, aede.osu.edu/aboutus/publications/taking-measure-ohios-opioid-crisis.

13 Ibid.

14 “County Health Rankings.” County Health Rankings & Roadmaps, www.countyhealthrankings.org/.

15 Ibid.

16 Ibid.

17 Anson, Pat. “The Coming ‘Economic Bonanza’ in Addiction Treatment.” Pain News Network, 25 May 2016, www. painnewsnetwork.org/stories/2016/5/25/the-coming-economicbonanza-in-addiction-treatment.

18 Popper, Ben. “The American Fix.” The Verge, The Verge, 20 Sept.

2017, www.theverge.com/2017/9/20/16335562/groups-recoveryaddiction-treatment-heroin-opioid-epidemic-suboxonemedication-access.

19 Ibid.

Photo Credits: CC0 Public Domain/pxhere—page 36 cabriolet2008/Flickr—page 38 Whitney Dankworth—page 40 10

CLASS OF 2021 • BUSINESS & POLITICAL ECONOMY

Born and raised in Columbus, Ohio, I was constantly surrounded by the opioid crisis. Having known addicts, I found myself frustrated that they are often treated as criminals rather than as victims, so I found myself researching addiction treatment. Once I knew the demographics of the opioid crisis, the treatment options available for addicts, and framed all that in the context of business, I could easily see my proposed solution.

FEWER PAINKILLERS, MORE PROFITS: ENDING AMERICA’S OPIOID CRISIS / 41

ESSAY BY

AVERY FARM

ON-TRACK TO DELIVER THE SOLUTION TO

PORT CONGESTION

Avery Farm proposes an innovative solution to end port congestion in Long Beach, California by revolutionizing the transportation involved in shipping supply chains.

O

ver 25,000 trucks file up and down the 710 freeway in Los Angeles every day, shuttling 43 percent of the nation’s imports between the Port of Long Beach and the western terminus of the continental railroad at train depots 25 miles north. 1 Thousands of other drivers must contend with these trucks as they jostle for room on the nation’s most congested highway network.

Meanwhile, residents along the 710 freeway are exposed to the highest levels of toxic diesel emissions in the city. 2 The truck drivers themselves fare no better: inefficient loading practices at the dock result in excessive wait times, which—when compounded by bumperto-bumper conditions on freeways—trap drivers in their cabs for hours on end. 3 In short, the over-reliance on short-haul trucking, also known as “drayage,” has adversely impacted multiple stakeholders in Los Angeles.

Congestion on the 710 will only worsen in the coming years. Shipping volume at the port is set to double by 2030, and the Los Angeles MTA is feeling pressure from the shipping community to accommodate the expected surge in truckers through the aging freeway. The rise of Amazon and other online retailers that promise fast shipping has increased pressure on global trade routes to regularly supply warehouses with foreign goods. To meet this demand, volume through the Port of Long Beach has surged significantly, making it the fastest-growing port by volume in the United States.4 On March 1, 2018, the MTA voted to move forward with plans to expedite certain projects along the 710 freeway meant to increase capacity. 5 While freeway expansion projects, especially in such a congested corridor, seem theoretically beneficial, any increase in capacity results in at least a proportionate increase in traffic per the law of induced demand: when roadways clear up, commuters immediately adjust their route to benefit from the promise of a shorter commute.6 Ultimately, nearly every major freeway expansion project in the United States has led to increased traffic congestion.7 There 44 / AVERY FARM

is no reason for the 710 to be any different, which is why a state-sponsored solution will only lead to more shipping traffic and pollution. Given that shipping volume will increase regardless of the expansion project, the shipping community needs a better plan moving forward.

While the state cannot remedy this impending drayage nightmare, private businesses are poised to help secure a more sustainable method of transporting the nation’s imports. Rather than increase freeway capacity, an alternative solution should focus on decreasing the demand for freeway use itself. Conveniently, International Transportation Services (ITS), the operator at the Port of Long Beach, already has access to an alternative mode of transportation that can achieve this goal: on-dock rail. On-dock rail describes the process of loading shipping containers directly onto trains, thereby eliminating drayage from the distribution process. These mile-long trains haul containers from the Port of Long Beach to train depots where they can be transferred to other freight trains. These depots can then leverage their extensive freighting equipment to transfer goods delivered via on-dock rail onto appropriate trains more efficiently than from individual trucks, which carry only one container at a time.

Drayage is prone to scheduling backlogs due to the sheer number of individual trucks involved. According to an estimate by the Harbor Trucking Association (HTA), a coalition of truckers based in Long Beach, drayage delays of just one minute per truck “create the need for 52 additional trucks in the harbor.” 8 This means that as shipping volume increases, congestion will worsen exponentially. In an uncontrollable cycle, ITS will be forced to hire more truckers, which will only crowd the port further.

Alternatively, by loading one additional freight train via on-dock rail, ITS could take 750 trucks off the road, greatly alleviating congestion, increasing the port’s efficiency, and eliminating the costs of hiring extra truck drivers.

However, ITS must take a few preliminary steps before fully integrating on-dock rail into its operations.

Presently, ITS’s existing on-dock facility is equipped with outdated technology, which makes loading full-length freight trains inefficient and thus too costly an alternative to pursue. 9 This is part of the reason why ITS has been unable to better utilize its on-dock facilities despite recent spikes in shipping volume.

Therefore, ITS needs to first invest in expanding and updating its current ondock facility to better accommodate the port’s shipping volume. Second, ITS should assess its current fleet’s destinations and strategically select train depots to maximize the efficiency of each trip. Trucks will still be necessary to make short trips and deliver goods to the inaccessible, but rail can remove the majority of drayage operations, especially because railroads already connect most train depots with Long Beach. Finally, ITS should instruct its international shipping providers to place shipments for earlier trains near the top of the stack, hence decreasing the time needed for offloading.

Through these simple steps, ITS can load each freight train more systematically and efficiently. After implementing these steps, ITS will make on-dock rail a viable solution for mitigating port congestion.

To fully evaluate the quality of this proposal however, it is necessary to examine potential benefits to community, state, and private stakeholders. ITS, the primary stakeholder in the business sector, will see both economic and social benefits from fully implementing ondock rail into its operations. While the recent increase in shipping demand has been good business for the port, drayage companies have raised rates for their services to capitalize on this boom. This year alone, for example, drayage rates are expected to increase by five to seven percent.10 Without feasible alternatives, harbor operators such as ITS will be forced to pay higher rates for even more drayage operations. If ITS were to further expand its on-dock operations, however, it would be able to avoid these higher rates. It would also enjoy the reputational benefit of being an environmentallyconscious company. The company has already emphasized its commitment

to reducing its environmental impact through its Clean Air Action Plan, which “identifies strategies to reduce pollution from every source” of the port’s operations.11 By implementing on-dock rail and pulling pollutant-emitting trucks off of roadways, ITS can cut costs and serve its stated environmental mission.

Beyond ITS, port congestion is also detrimental to the truck drivers themselves. Truck drivers spend an average of 85 minutes waiting for their designated shipment, but this delay can reach two hours or more during peak shipping seasons.12 Because most drivers spend so much of their work day waiting, drivers’ productivity has decreased precipitously; they used to deliver four or five containers a day and now average just two.13 Drayage, then, is both less efficient for port operators and unhealthy for truck drivers. By allocating more of its shipping volume towards on-dock rail, ITS can reduce the strain it places on truck drivers to constantly meet increasing shipping demand, thereby improving its own productivity as well as the drivers’.

In addition to the businesses that will benefit from ITS’s increased use of on-dock rail, the public sector will also be positively impacted. For example, the Alameda Corridor Transportation

Authority (ACTA), a city agency that maintains and operates what is known as the Alameda Corridor, will see financial gains from ITS’s increased use of on-dock rail. The Alameda Corridor, a twenty-mile network of railroad tracks that connects the Port of Long Beach to train depots in Vernon, Commerce, and downtown Los Angeles, is the result of a $2.4 billion project meant to speed goods to market.

It was hailed as “a key to future successes of the ports”14 when it opened in 2002; however, ITS’s lack of infrastructure investment has left the route operating at just 25 percent capacity and the ACTA with $4 billion in debt.15 Financial projections show that the ACTA can cover most of its debt if it operates at 50 to 60 percent capacity by 2030.16 ITS can help the ACTA fully recover its losses—and even turn profitable—by diverting 80 percent of its truck-bound containers to train beds. The City of Los Angeles can then reinvest any generated profits in the community itself rather than railroad debt.

In addition to reallocating city funding, on-dock rail has numerous benefits for the Los Angeles community.

Residents along the 710 currently suffer from toxic diesel fumes emitted by passing trucks. The recent increased

presence of trucks has only exacerbated the dangerous levels of carbon dioxide and carbon monoxide in the South Coast Air Basin, which includes the Port of Long Beach and its surrounding communities.17 An additional study found that exhaust from trucks in the 710 corridor has been specifically linked to an elevated presence of health problems “such as decreased lung function, asthma, increased lung and heart disease symptoms, and chronic bronchitis.”18 These health complications are so pervasive and widespread that neighbors have dubbed the houses nearest the freeway “Cancer Alley.” 19 Approximately one million people live in the area affected by exhaust from trucks, most of whom are communities of color with low socioeconomic means.20 If Los Angeles officials were to increase the carrying capacity of the freeway as planned, they would be neglecting these residents’ health and interests. Thus, corporate action is a more efficient and effective way to mitigate the negative externalities that port operations pose to the surrounding community.

Community agencies will also benefit from a shift towards on-dock rail. For instance, the Los Angeles Area Environmental Enforcement Collaborative aims to “partner with

CAN A SPONGE SAVE THE DEEPWATER HORIZON? / 45

communities, proactively identify community concerns, and work with partner agencies to identify resources available to address problems” regarding air pollution along truck routes. 21 The agency’s credibility depends on its ability to advocate for community interests. By collaborating with the ITS, the group can bolster its reputation and increase its ability to affect intended change.

Finally, in addition to benefiting residents living along the 710 freeway and around the port area, on-dock rail will also benefit the commuting public at large simply due to the reduction of truck traffic on roadways. Surging truck traffic has led to a spike in truck-related accidents: in 2009, truck collisions comprised 4.8 percent of all crashes in Los Angeles, but by 2014 that number had climbed to 5.6 percent.22 Increasing demand for container goods is expected to push this number even higher in the coming years. Additionally, collisions involving trucks are twice as likely to be fatal than those involving passenger cars, and any fatalities are more than twice as likely to be incurred in the passenger car than in the truck.23 These data show that reducing unnecessary truck movement on roadways will both free up space on highways for commuters and make commuting safer, too.

While implementing on-dock rail will benefit multiple stakeholders, there are a number of risks associated with overhauling the transportation methods

at the largest port in the nation. Most prominently, a de-emphasis on port drayage means that some truck drivers will inevitably lose their jobs. While the current collection system at the Port of Long Beach is less than ideal for truck drivers, it is still a source of employment.

The decrease in demand for drayage at Long Beach will be partially offset by an increase in demand at train depots; however, there is no guarantee that displaced drivers from Long Beach will be able to make a switch very easily, especially if their drayage companies have dealt exclusively with the Port of Long Beach. The shift in the location of drayage services from ports to train depots leads to a second risk: train depots must increase capacity to accommodate the spike in train movements resulting from this proposal’s implementation. Given these risks, a valid question is whether the benefits of investing in on-dock rail realistically outweigh long-run costs.

A recent shift towards on-dock rail at a port in Seattle suggests that the benefits do indeed outweigh the costs. At the Seattle-Tacoma Port, implementation of on-dock rail has decreased truck movements by onethird, which has significantly increased the port’s operational efficiency. 24 In fact, the Port of Tacoma “sees efficient rail operations as a strategic advantage in its competition for market share with Canada and California ports.”25 Harvard professor Christopher A. Bartlett explains

AVERY FARM I began my research in Los Angeles, the traffic capital of the world, and found that container trucks that transverse a freeway servicing the nation’s busiest port complex expose one million Angelenos to cancer-inducing levels of pollution in their homes.

To pull container trucks off the road, I investigated alternative transportation methods for the shipping containers and eventually focused my attention on an underutilized freight rail corridor owned by the City of Los Angeles.

42 / WYMAN 46 AVERY FARM LI

the basis of the Tacoma Port’s success: “overcapacity and intense competition are the norm in most global businesses . . . as technologies and markets converge, new growth opportunities [are created] where traditional businesses intersect.”26 The Tacoma Port implemented a solution at the intersection of technology and business in order to streamline its processes and become more competitive.

The ensuing success of its on-dock solution demonstrates the potential for similar success in Long Beach.

Pe r h a p s t h e m o s t c o n v i n c i n g arguments in favor of on-dock rail are the consequences of maintaining the status quo. Companies from FedEx to Lululemon Athletica have begun to feel the effects of congestion at the port in their west coast operations. Some brands have even resorted to “airlifting their goods or diverting them to the East and Gulf Coasts” to ensure their shipments arrive on time. 27 Not only are the environmental repercussions of these expedited shipments tremendous, but these tactics hurt both ITS and its customers financially. As Frederick Smith, FedEx’s CEO, states, “The slowdown in the West Coast ports has been a much bigger deal than people think.”28 Drayage is economically and environmentally incompatible with a growing world trade market. On-dock rail, on the other hand is a reasonable solution that—while not without its shortcomings—mitigates port

CLASS OF 2021 • FINANCE & BS/MS ACCOUNTING

“

Health complications [from truck exhaust] are so pervasive and widespread that neighbors have dubbed the houses nearest the freeway ‘Cancer Alley.’”

inefficiency and creates shared value for all stakeholders in the process.

When executives step back from their short-term, profit-driven mentality and focus on creating lasting shared value instead, business, state, and community

sectors all stand to benefit. In this case, the shipping executive ITS has greater incentives and more control than government agencies to regulate port congestion and pollution. This is because on-dock rail, unlike any government

Parvini, Sarah. “Breathing Uneasy: Living Along the 710 Freeway Corridor.” KCET, 23 Feb. 2016, www.kcet.org/shows/departures/ breathing-uneasy-living-along-the-710-freeway-corridor.

2 Nelson, Laura J. “710 Freeway Is a ‘Diesel Death Zone’ to Neighbors – Can Vital Commerce Route Be Fixed?” Los Angeles Times, 1 March 2018, https://www.latimes.com /topic/transportation/ airtransportation/los-angeles-international-airport-PLTRA0000070topic.html.

3 Ashe, Ari. “Cargo Volumes, Truck Delays Rise at Ports of Los Angeles and Long Beach.” Transport Topics, 18 June 2017, www.ttnews.com/ articles/cargo-volumes-truck-delays-rise-ports-los-angeles-andlong-beach.

4 Tirshwell, Peter. “Time to Get on-Dock Rail on Track.” 22 Oct. 2015, www.joc.com/portnews/us-ports/its-time-get-dock-railtrack_20151022.html.

5 Chiland, Elijah. “Metro Board Moves Forward with 710 Overhaul, but Wants to Wait on Widening.” Curbed LA. 1 Mar. 2018, la.curbed. com/2018/3/1/ 17067400/710-freeway-widening-expansion-plan.

6 Duranton, Gilles, and Matthew Turner. “The Fundamental Law of Highway Congestion: Evidence from the US. The Fundamental Law of Highway Congestion: Evidence from the US.” Https://Www. parisschoolofeconomics.eu/En/, Paris School of Economics, www. parisschoolofeconomics.eu/IMG/pdf/traffic_seminar3b.pdf.

7 Ibid.

8 Ashe. “Cargo Volumes, Truck Delays Rise.”

9 Gamette, Sean, et al. “The New Pier B On-Dock Rail Support Yard On Track for Tomorrow.” Board of Harbor Commissioners Meeting. 16 Nov. 2018, Los Angeles. http://polb.com/civica/filebank/blobdload. asp?BlobID=14750.

10 Mongelluzzo, Bill. “US Drayage Drivers: Little Resistance to Rate Hikes.” JOC.com, Journal of Commerce, 9 Feb. 2018, www.joc. com/trucking-logistics/us-drayage-drivers-little-resistance-ratehikes_20180209.html.

11 “Strategies.” Clean Air Action Plan, The Ports of Los Angeles and Long Beach, 2017, www.cleanairactionplan.org/strategies/.

12 Ibid.

13 Ibid.

1

mandate, combines public benefits with private profits. Although the shipping industry is not intrinsically motivated by environmental consciousness, it has the power to substantially mitigate this social problem while profiting all the same.

Uranga, Rachel. “Alameda Corridor Dream Becomes Financial Nightmare for Los Angeles and Long Beach Ports.” Press-Telegram, Long Beach Press Telegram, 1 Sept. 2017, www.presstelegram. com/2016/09/24/alameda-corridor-dream-becomes-financialnightmare-for-los-angeles-and-long-beach-ports/.

15 Ibid.

16 Ibid.

17 Parvini. “Breathing Uneasy.”

18 Ibid.

19 Ibid.

20 Ibid.

21 “Los Angeles Area Environmental Enforcement Collaborative.”

EPA, Environmental Protection Agency, 18 Sept. 2018, www.epa. gov/environmentaljustice/los-angeles-area-environmentalenforcement-collaborative.

22 Carino, Meghan McCarty, and Aaron Mendelson. “Big Rigs, Big Risks: Truck Traffic Rising along with Crashes.” KPCC, Southern California Public Radio, 2 May 2017, www.scpr.org/ news/2017/05/02/69883/big-rigs-big-risks-as-socal-economyimproves-truck/.

23 Ibid.

24 Mongelluzzo, Bill. “Tacoma Uses on-Dock Rail as a Competitive Advantage.” JOC.com, Journal of Commerce, 12 Nov. 2015, www. joc.com/port-news/us-ports/port-tacoma/tacoma-uses-dock-railcompetitive-advantage_20151112.html.

25 Ibid.

26 Bartlett, Christopher A., and Sumantra Ghoshal. “Beyond Strategy to Purpose.” Harvard Business Review, Harvard Business Publishing, Nov. 1994, hbr.org/1994/11/beyond-strategy-to-purpose.

27 Khouri, Andrew. “Congestion at Ports of L.A., Long Beach Is Putting a Damper on Economy.” Los Angeles Times, 25 Dec. 2014, www. latimes.com/business/la-fi-port-traffic-20141226-story.html.

28 Ibid.

Photo Credits: Tom Fisk/Pexels—page 42 Michael/Flickr—page 45 Samuel Wölfl/Pexels—page 47 14

ON-TRACK TO DELIVER THE SOLUTION TO PORT CONGESTION / 47

Combating:

Coyotes

FIGHTING LABOR

TRAFFICKING IN

U.S. AGRICULTURE

S

panning over two thousand acres, the Grant Family Farm in Colorado is a private supplier of vegetables to brands like Whole Foods.1 Its owner, Andy Grant, labels himself as an “adherent to social justice” and always pays workers above minimum wage. Thus, Grant was shocked to see his name in a civil lawsuit for labor trafficking in 2004. He claimed to be unaware that the labor broker he employed illegally trafficked and consistently abused the workers on his farm.2 Large deductions were also taken out of the wages Grant paid so that only about $2 per hour made it to the workers.

Moreover, Grant’s labor broker utilized smugglers, known to the locals as coyotes, to recruit and transport Mexican workers. The corrupt labor broker was exposed and brought to justice when five undocumented workers took their case to court. In the end, Grant filed for bankruptcy and settled with the workers, in fear that litigation would cost him his connections to major retailers. 3 With even farm owners claiming ignorance to worker conditions, it is unsurprising that consumers are generally unaware as to how food ends up on their tables.

In U.S. agriculture, Grant’s case is far from an anomaly. USDA studies have found that about 97 percent of American

farms are family-owned and incorporated just like the Grant Family Farm.4 The seasonal and low-skilled nature of agricultural jobs are so unattractive to domestic workers that these farms largely rely on foreign workers.5 A federal survey revealed that undocumented workers account for more than half of the farm workforce, but Grant claims from personal experience that actually around 70 to 80 percent of agricultural workers are undocumented. 6 Undocumented workers often fall prey to corrupt labor practices in an effort to find work in the United States. In fact, the Global Slavery Index estimated in 2016 that over 50 thousand people, including trafficked and forced labor, live under modern slavery in the U.S.7 Moreover, an array of other abuses—most prominently wage theft and violence—also plague the agricultural system. 8 These painstaking problems, however, present a market opportunity for two organizations leading the fight against labor trafficking.

In comparison to other nations, the U.S. government performs well above average in preventing trafficking through policy and enforcement. For example, H2A, a specialized guest worker visa set aside for agricultural workers, has well-defined terms and conditions. 9 Furthermore, under the Trafficking Victims Protection

Act, U.S. law criminalizes all forms of trafficking. In 2016 alone, over 200 cases of trafficking were prosecuted.10 Yet, despite these protections, trafficked labor is still prevalent in U.S. agriculture. A news report describes U.S. agriculture as “a massive, market-driven exploitation of largely Mexican, Haitian, and Guatemalan migrant workers.” 11 But what really drives farmers and labor brokers to risk years in prison in order to exploit trafficked labor? Market conditions, including high demand for cheap labor and sophisticated trafficking networks, drive stakeholders to exploit various loopholes in U.S. legislation.12 For example, in his testimony, Grant confessed he was aware that hiring through brokers increased the chances of trafficking and abuse, but he had no other options. He complained that small farms struggle to survive in fierce competition, and labor contractors became a necessity for his farm when he had to hire a large number of laborers in a short period of time. 13 He further noted that the recent escalation in border security and deportation was “killing ” an already shrinking legal labor force. 14 On top of these concerns, there also exists general fear among farmers that their crops will rot, unharvested, despite growing wages.15 Overall, the shortage of a legitimate

Trafficking, abuse, theft, and violence plague the agricultural system in the United States. Casey Chen proposes a partnership between the Coalition of Immokale Workers and Verité, a labor advocate, to create a Fair Hiring Initiative that would directly compete with illegal labor brokers.

ESSAY BY workforce causes market failure and drives farmers to engage in trafficking and abuse.

O n t h e s u p p l y s i d e , c u tt h r o a t competition between labor brokers results in the shortage of legitimate workers. There are over one thousand labor brokers legally registered in the U.S., and numerous more illegal ones. 16 Many of them, even ones that provide legal documentation, employ coyotes, or smugglers, in foreign countries. U.S. law prohibits brokers from charging fees for visas, but a reputable coyote can charge each worker some thousands of dollars, leaving workers deeply in debt even before they set foot on U.S. soil.17 Brokers are also known to coach their victims to lie to U.S. custom officers on various issues, from fees to contracts.18 Aside from debt bondage, threats of violence and deportation as well as restriction of personal liberty are some methods abusive labor brokers use to manipulate their victims.19 Investigations revealed that coyotes often entrap victims with false promises of a better life, so much so that some victims volunteer to pack into the backs of trucks to steal across borders. 20 Organized criminal gangs have also been deemed responsible for trafficking cases across the U.S.-Mexico

border to get their cut of the lucrative business.21 To redirect unregulated market forces to the path of social value creation, a global Fair Hiring Initiative should match growers in need with prospective laborers in Latin American countries with the largest at-risk populations. The Initiative would be a joint venture between two organizations committed to stop labor trafficking: the Coalition of Immokalee Workers (CIW) and Verite.

The CIW is a worker’s cooperative that spearheads the efforts against labor trafficking and abuse by increasing consumer awareness of these issues.

Starting out in the tomato farms of Florida, CIW was instrumental in transforming the labor conditions in the tomato industry. Even as early as the 1940s, Immokalee, Florida was known for its horrendous labor conditions, described by journalists as “pig pens filled with humans.”22 To make consumers aware of these conditions, CIW initiated a “clean labor” movement in 2010 and put “Fair Food” labels on farm produce grown and picked ethically.23 By 2017, over 90 percent of Florida tomato growers had joined the Fair Food program and operated according to its Codes of Conduct.24 CIW also forged partnerships with large growers and influential

CASEY CHEN

retailers such as Walmart, Whole Foods, and McDonalds. The Fair Food program filled regulation gaps by implementing third-party auditing over farmers’ hiring and labor practices.25 Despite raising consumer awareness, however, CIW fails to address farmers’ needs. In 2017, “Participating Buyers” (i.e.

Whole Foods) in the Fair Food program paid a total of $26 million in premiums for Fair Food labeled goods; proceeds were used to pay workers. 26 Following large retailers, farmers had no choice but to join the program; otherwise, they would run the risk of losing important clients. This transition to fair hiring and labor practices, however, remains difficult and costly. Moreover, unregulated labor brokers and coyotes stand in the way.

CIW does not have any existing programs that address the difficulties farmers face in adapting labor practices, despite its expressed desire to expand the Fair Food program all over the United States.27 The Fair Hiring Initiative would complement CIW’s existing Fair Food program so that value is created for all stakeholders, including farmers.

The Fair Hiring Initiative would act as a labor intermediary, matching farmers with legitimate foreign workers and smoothing the transition to a Fair Food certified farm. It would help proliferate

the adoption of the Code of Conduct already drawn up by CIW that sets a wide range of standards concerning wages, hours, and the working environment. The extensive spread of the Code of Conduct in the Initiative would improve workers’ quality of life on farms through the zerotolerance policy on violence, sexual harassment, and forced labor.28 C u r r e n t l y, C I W o n l y o p e r a t e s domestically, but it could partner with Verite—an international advocate of fair labor—to reach out to prospective workers in foreign countries. Verite has a global network of fair labor projects and extensive experience in supply chain management. 29 For instance, it has consulted for well-known brands like Nestle and Patagonia to advocate for better recruitment practices and migrant labor conditions.30 In this partnership, Verite would be responsible for setting up stations in Latin American regions with large supplies of farm laborers. Its understanding of labor conditions in foreign countries would help CIW connect with local populations. Additionally, Verite’s partners such as Nestle and Target would further strengthen CIW’s own extensive network.31 This partnership would allow CIW to utilize Verite’s expertise in foreign markets; together, the two independent organizations would share governance roles, economic responsibilities, and financial returns while working jointly toward the success of the Initiative.

To thrive in the competitive labor broker industry, the Initiative needs the efficiency and scalability of a forprofit business. At the same time, the reduction of labor trafficking must be the business’s central focus. The Initiative should therefore be a for-profit social venture with the potential to excel both

“

financially and socially. 32 Financially, the Initiative can measure its success in terms of revenue and growth; socially, it can measure success by the positive impact on workers’ lives and the decrease in trafficking figures.

The Initiative would enjoy a large and growing market of documented agricultural workers, which exceeded 300 thousand in 2016.33 It could generate revenue by charging farmers a fee of around $100 per worker for a visa, education, and transportation.34 Higher productivity and better relationships with major retailers would be the unique competitive advantages of the Initiative.

CIW currently operates with three crops in Florida: tomatoes, strawberries, and peppers. 35 Farmers with these products must become Fair Food certified before they can sell to Participating Buyers like Whole Foods. The same rule would apply to the crops CIW becomes involved with in the future. It took seven years of dedicated work for the Fair Food program to win fair wages for Florida farm workers, but with the established connections and resources from the Fair Food program at its disposal, the Fair Hiring Initiative would have an easier time reaching farmers.

To further enhance its appeal, the Initiative could create a database of all registered workers and farmers and match them based on skills and preferences. Traditional labor brokers are often criticized for supplying farmers with workers that do not possess specific skill sets needed to grow certain crops.36 For instance, picking fruits and tending to vineyards require distinct skill sets. The Initiative would validate registered workers’ experiences and then match them with farmers with certain specifications. It should also consider

building its own platform for labor matching or forming partnerships with existing agri-tech companies. Granular, for example, is an advanced farm management software that helps small farmers choose crops, manage labor, and make informed financial decisions.37 It has the technology to match large quantities of farmers’ inquiries with worker profiles and already serves thousands of small farmers.38 It may be difficult for a fledgling initiative to partner with a large, forprofit business, but the Initiative can start small. In time, increased awareness and expansion could manifest into such a partnership.

To minimize risks, the Initiative should launch a pilot program in Mexico before expanding to other countries. An estimated 60 percent of undocumented agricultural workers are from Mexico; the proximity to the U.S. also means lower transportation costs.39 To gather the rather high start-up funding, the Initiative should seek investments from its existing partners as well as impact investors.

Impact investors share for-profit social ventures’ goals to make positive social impacts with the expectation of financial returns.40 In 2016, impact investments climbed above $2.2 billion dollars, with sustainable agriculture as a major sector.41 As a non-profit leader in the growing labor contractor industry, CIW has demonstrated excellent management of a passionate, dedicated team. Thus, from an investor’s perspective, the Initiative has competent management, competitive advantages, and huge potential for growth.

Though other organizations have used labor intermediaries as way to combat trafficking, their focus has been on regulation. For example, the Integrated Program on Fair Recruitment, a UN project founded in 2015, addressed

Coyotes often entrap victims with false promises of a better life, so much so that some victims volunteer to pack into the backs of trucks to steal across borders.”

50 / TARA RANGWANI

widespread abusive recruitment practices in Hong Kong ’s hiring of Philippine workers. One of its main objectives was to build “fair corridors” for migrant workers by promoting ethical labor intermediaries while exposing deceptive or coercive ones.42 At the same time, it pushed for policy changes and regulations to monitor private labor brokers. At its conclusion, the project reported “increased safe migration options” and “effective regulation” of agencies.43 This project recognized the importance of regulated labor contractors and demonstrated the viability of fair hiring practices. But in the United States, the agriculture industry is significantly larger and more difficult to monitor. The Fair Hiring Initiative is distinct in that it competes with abusive labor brokers rather than try to regulate them. Its profitability and scalability give it potential to influence the entire industry.

The Fair Hiring Initiative reduces trafficking and abuse through a “value chain” that creates social value at every step in its daily operating activities.

Technology and ethical shopping will be important drivers in this value chain.44 First, to reach workers in Latin America, Verite should start local campaigns revealing the dangers of trafficking and the lies of the coyotes. This would act simultaneously as a marketing campaign and a public service announcement.

To effectively reach those vulnerable to trafficking, Verite needs to first understand their circumstances and empathize with them—a difficult task for those disconnected from farm labor.

Sean McMahon is an immigrant defense attorney at the Urban Justice Center, an organization committed to empowering the working poor. McMahon specializes in legal support for workplace

abuse.45 In a personal interview, he reflected that the definition of “labor trafficking victim” remains controversial in American politics.46 Most victims were not coerced but willingly smuggled, and many were victims of circumstances before trafficking occurred. They may have faced insurmountable debts or had little-to-no career options, and were easily deceived by the smugglers’ false promises.47 Under the UN Trafficking P r o t o c o l , h o w e v e r, a n y p e r s o n trafficked and exploited “at a position of vulnerability” constitutes a victim.48 While the UN Protocol recognizes these laborers as victims, one could argue from a U.S. standpoint that they are alien smugglers who have committed crimes against the state. America’s cognitive dissonance on labor trafficking has led us to a strange point where “exceptional victims of trafficking receive temporary care while illegal aliens considered responsible for breaking the law are criminalized and condemned.” 49 The Initiative, on the other hand, would uphold humanitarian values and choose to view all victims equally as victims of exploitation.

Case studies show that people desperate for a living go to reputable coyotes willingly, and coyotes personally reach out to those more reluctant and persuade them with promises of a better future.50 Verite should design its message to reach vulnerable populations: the poor, debtors, and desperate parents, before the coyotes do. Research finds that 70 percent of workers get in contact with coyotes through word of mouth.51 This makes building personal connections more important than broadcasting advertisements. Verite should not only advertise broadly, but also engage with local communities to help spread the

message. Verite could recruit local antitrafficking institutions, faith groups, and volunteers to help as well as use CIW’s reputation to establish itself as a trustworthy and safe alternative to smuggling. CIW has received a breadth of international and national recognition, including the 2015 Presidential Medal for Extraordinary Efforts to Combat Human Trafficking.52 After acquiring registered workers, the partnership would educate these workers on their rights in the U.S. In an interview with the author, McMahon addressed concerns over how the H2A program ties workers to a single employer who may fire them freely.53 According to one news article, “even visa holders are often loath to complain about abuses, given that their working papers tie them directly to a single employer… who can send them home at will.” 54 However, McMahon refuted this statement, pointing out that documented workers have the right to sue for immigration relief the moment they are threatened with deportation or violence. Certain laws also grant workers the ability to move between employers.55 This information, however, is not readily available or easily accessible, especially for workers with restricted personal liberties and limited English fluency.

The Initiative solves this problem by providing education. CIW has a successful track record of promoting worker-toworker education, with experienced workers educating newcomers on their rights every harvest cycle.56 This method has proven to be effective and inexpensive. The Initiative can continue educating workers in the same framework but cover more topics. Workers will be more knowledgeable and receive the contact information of institutions like the Urban Justice Center. Workers with

COULD TRASH CURE HAITI’S EMPLOYMENT CRISIS? / 51

poor English skills can receive longterm education from fluent workers. The Initiative can also organize vocational training that broadens workers’ career options and increases their productivity on farms.

The Initiative and the Fair Food Program will complement each other, creating a positive feedback loop. In this partnership, CIW will audit labor conditions. CIW has established a framework to encourage compliance with its Code of Conduct, including unannounced professional audits and an effective worker complaint process.57 It will use its domestic influence to find small farms with the potential to transition into Fair Food farms. Interested farmers will need to adhere to the Code of Conduct to become Fair Food certified.

The zero-tolerance policy for using labor contractors in the framework helps eliminate the influence of labor brokers altogether.58 But the seasonal demand for labor and an exhausted domestic worker supply make direct hiring tremendously more difficult.59 Additionally, as seen in Grant’s testimony, small farms do not have the financial power or influence to reach a large quantity of workers in a short window. With the implementation of the

Fair Hiring Initiative, farmers will have a choice between direct hiring and hiring from the Initiative’s trusted source. The reduced transition costs will attract more farmers, increasing brand awareness of Fair Food labels and attracting more retail partners and farmers.

CIW’s past success has proven that it is possible to transform an entire industry.

However, while it has the potential to succeed and scale, it will not totally eradicate labor trafficking. Even though the Initiative eases the hiring process, some farms will invariably opt out of the program. Trafficked labor will continue to attract farmers unable to afford H2A visa costs such as reimbursements for transportation, housing, and health care. 60 Simultaneously, the demand to work in the U.S. will most likely exceed the supply of visas, an imbalance that will continue to incentivize trafficking.

Finally, organized crime syndicates supporting trafficking pose a threat to the Initiative. If the Initiative threatens their operations, there is the worrying possibility that criminal gangs will take unpredictable actions to fight back.

People become victims of trafficking because of poverty, national crisis, systematic discrimination, and lack of

CASEY CHEN

education.61 It is unreasonable to expect one perfect solution to eradicate labor trafficking. Roberto Pires, an economist and fair labor advocate, observes that a solution to such complex social problems requires “acupuncture” that applies pressure at precise spots in order to induce systematic change. 62 The Fair Hiring Initiative may only be a needle, but it can burst the unregulated and opaque bubble of the labor broker industry. Combined with CIW’s existing Fair Food Program, the Initiative will reward farmers for ethical hiring, protect workers from abusive employers, and demonstrate that trafficking is not necessary to stay competitive.

Beyond agriculture, the systematic changes brought forth by the Fair Hiring Initiative will serve as an example for industries equally rife with workers’ rights abuse, such as fishing and forestry.

The Initiative will also plant the seed of workers’ rights awareness in other developing Latin American countries so that, over time, these nations will move to protect workers’ rights as well.

CLASS OF 2021 • FINANCE

My primary goal is to show the severity of human trafficking unknown to most people. It also shows that as long as there is a demand, a legal and ethical business can still be established to drive out illegal activities in most cases.

“Immigrant Workers in US Agriculture: The Role of Labor Brokers in Vulnerability to Forced Labor.” Verite, Verite, Jun.2010, https://www. verite.org/wp-content/uploads/2017/03/HELPWANTED_A-Verite%CC%81-Report_MigrantWorkers-in-the-United-States.pdf.

2 Ibid.

3 Ibid.

1

52 / CASEY CHEN

Philpott, Tom. “Does ‘Corporate Farming’ Exist? Barely.” Mother Jones, 24 June 2017, www.motherjones.com/food/2013/09/doescorporate-farming-exist-barely/.

5 Ibid.

6 “Immigrant Workers in US Agriculture: The Role of Labor Brokers in Vulnerability to Forced Labor.” Verite, Verite, Jun.2010, https://www.

4

verite.org/wp-content/uploads/2017/03/HELPWANTED_A-Verite%CC%81-Report_MigrantWorkers-in-the-United-States.pdf.

7 “United States.” Global Slavery Index 2016, https:// www.globalslaveryindex.org/country/unitedstates/.

8 “Fair Food 2017 Annual Report.” Coalition of Immokalee Workers, 17 Apr. 2018, http://

ciw-online.org/wp-content/uploads/FairFood-Program-2017-Annual-Report-ForPrint-4-17-18.pdf.

9 “H-2A Temporary Agricultural Workers.” USCIS, 8 Mar. 2018, www.uscis.gov/working-unitedstates/temporary-workers/h-2a-temporaryagricultural-workers.

10 “Trafficking in Persons Report 2014.” U.S. Department of State, U.S. Department of State, www.state.gov/j/tip/rls/tiprpt/2014/index.htm.

11 Jonsson, Patrick. “Trafficking: In Florida’s Tomato Fields, a Fight for Ethical Farm Labor Grows.”

The Christian Science Monitor, The Christian Science Monitor, 16 Nov. 2015, www.csmonitor. com/World/2015/1116/Trafficking-In-Floridas-tomato-fields-a-fight-for-ethical-farm-laborgrows.

12 Ribando, Clare. “Trafficking in Persons in Latin America and the Caribbean.” Organization of American States, Congressional Research Service, 15 Dec. 2005, http://www.oas.org/atip/ latin%20america/crs%20dec%202005.pdf.

13 “Immigrant Workers in US Agriculture: The Role of Labor Brokers in Vulnerability to Forced Labor.” Verite, Verite, Jun. 2010, https://www. verite.org/wp-content/uploads/2017/03/HELPWANTED_A-Verite%CC%81-Report_MigrantWorkers-in-the-United-States.pdf.

14 Kitroeff, Natalie, and Mohan Geoffrey. “Wages Rise on California Farms. Americans Still Don’t Want the Job.” Los Angeles Times, Los Angeles Times, 17 Mar. 2017, www.latimes.com/projects/la-fifarms-immigration/.

15 Ibid.

16 “Immigrant Workers in US Agriculture: The Role of Labor Brokers in Vulnerability to Forced Labor.” Verite, Verite, Jun.2010, https://www. verite.org/wp-content/uploads/2017/03/HELPWANTED_A-Verite%CC%81-Report_MigrantWorkers-in-the-United-States.pdf.

17 Ibid.

18 Ibid.

19 Ribando, Clare. “Trafficking in Persons in Latin America and the Caribbean.” Organization of American States, Congressional Research Service, 15 Dec. 2005, http://www.oas.org/atip/ latin%20america/crs%20dec%202005.pdf.

20 “Labor Brokers and the Bait-and-Switch for Temporary Workers.” Polaris Project, https:// polarisproject.org/blog/2016/03/08/laborbrokers-and-bait-and-switch-temporaryworkers.

21 Ribando, Clare. “Trafficking in Persons in Latin America and the Caribbean.” Organization of American States, Congressional Research Service, 15 Dec. 2005, http://www.oas.org/atip/ latin%20america/crs%20dec%202005.pdf.

22 Jonsson, Patrick. “Trafficking: In Florida’s Tomato Fields, a Fight for Ethical Farm Labor Grows.”

The Christian Science Monitor, The Christian Science Monitor, 16 Nov. 2015, www.csmonitor. com/World/2015/1116/Trafficking-In-Floridas-tomato-fields-a-fight-for-ethical-farm-laborgrows.

23 Coalition of Immokalee Workers, ciw-online.org/ about/.

Ibid.

Ibid.

26 “Fair Food 2017 Annual Report.” Coalition of Immokalee Workers, 17 Apr. 2018, http:// ciw-online.org/wp-content/uploads/FairFood-Program-2017-Annual-Report-ForPrint-4-17-18.pdf.

27 Coalition of Immokalee Workers, ciw-online.org/ about/.

28 “Fair Food 2017 Annual Report.” Coalition of Immokalee Workers, 17 Apr. 2018, http:// ciw-online.org/wp-content/uploads/FairFood-Program-2017-Annual-Report-ForPrint-4-17-18.pdf.

29 “About.” Verité, www.verite.org/about/.

30 Ibid.

31 Ibid.

32 Dees, Gregory & Anderson, Beth Battle. “For Profit Social Ventures.” Ed. Marilyn L. Kourilsky et al.

2003. Senate Hall Academic Publishing. Web. 33 Twohey, Megan et al. “Brokers Who Recruit Foreign Workers to U.S. Exploit Vulnerabilities.”

Reuters, Thomson Reuters, 19 Feb. 2016, www. reuters.com/investigates/special-report/ workers-brokers/.

34 There is little information on how much labor brokers charge on average. Prices vary depending on country, crop and whether transportation and housing are included.

Typically abusive brokers charge farmers very little to compete for their business, but charge laborers up to thousands of dollars. By law the H2A visa prohibits charging workers recruitment fees, and transportation and housing must be reimbursed by employers.

Therefore I decided on a relatively low fee for farmers, knowing that they will be burdened with worker housing and health care. The Initiative should use CIW’s ties to interview farmers before deciding on a final price.

35 “Fair Food 2017 Annual Report.” Coalition of Immokalee Workers, 17 Apr. 2018, http:// ciw-online.org/wp-content/uploads/FairFood-Program-2017-Annual-Report-ForPrint-4-17-18.pdf.

36 “Immigrant Workers in US Agriculture: The Role of Labor Brokers in Vulnerability to Forced Labor.” Verite, Verite, Jun.2010, https://www. verite.org/wp-content/uploads/2017/03/HELPWANTED_A-Verite%CC%81-Report_MigrantWorkers-in-the-United-States.pdf.

37 “About Us.” Granular, https://www.granular.ag/ about-us/.

38 Ibid.

39 “Immigrant Workers in US Agriculture: The Role of Labor Brokers in Vulnerability to Forced Labor.” Verite, Verite, Jun.2010, https://www. verite.org/wp-content/uploads/2017/03/HELPWANTED_A-Verite%CC%81-Report_MigrantWorkers-in-the-United-States.pdf.

40 “Research and Opinions.” Global Impact Investing Network. https://thegiin.org/research-andopinions/.

41 Ibid.

42 “Integrated Programme on Fair Recruitment (FAIR) - Philippines.” ILO, International Labor 24 25

Organization, http://www.ilo.org/manila/ projects/WCMS_484153/lang--en/index.htm.

43 Ibid.

44 Dees, Gregory & Anderson, Beth Battle. “For Profit Social Ventures.” Ed. Marilyn L. Kourilsky et al.

2003. Senate Hall Academic Publishing. Web. 45 McMahon, Sean. Personal interview. 18 April 2018.

46 Ibid.

47 Palacios, Simon Pedro Izcara & Yamamoto, Yasutaka. “Trafficking in US agriculture.”

Antipode, Ed. Jazeel Tariq et al. 2017. Wiley Online Library. Web. 48 Ibid.

49 Ibid.

50 Ibid.

51 “Immigrant Workers in US Agriculture: The Role of Labor Brokers in Vulnerability to Forced Labor.” Verite, Verite, Jun. 2010, https://www. verite.org/wp-content/uploads/2017/03/HELPWANTED_A-Verite%CC%81-Report_MigrantWorkers-in-the-United-States.pdf.

52 Coalition of Immokalee Workers, ciw-online.org/ about/.

53 “H-2A Temporary Agricultural Workers.” USCIS, 8 Mar. 2018, www.uscis.gov/working-unitedstates/temporary-workers/h-2a-temporaryagricultural-workers.

54 Jonsson, Patrick. “Trafficking: In Florida’s Tomato Fields, a Fight for Ethical Farm Labor Grows.”

The Christian Science Monitor, The Christian Science Monitor, 16 Nov. 2015, www.csmonitor. com/World/2015/1116/Trafficking-In-Floridas-tomato-fields-a-fight-for-ethical-farm-laborgrows.

55 McMahon, Sean. Personal interview. 18 April 2018.

56 “Fair Food 2017 Annual Report.” Coalition of Immokalee Workers, 17 Apr. 2018, http:// ciw-online.org/wp-content/uploads/FairFood-Program-2017-Annual-Report-ForPrint-4-17-18.pdf.

57 Ibid.

58 Ibid.

59 “Immigrant Workers in US Agriculture: The Role of Labor Brokers in Vulnerability to Forced Labor.” Verite, Verite, Jun.2010, https://www. verite.org/wp-content/uploads/2017/03/HELPWANTED_A-Verite%CC%81-Report_MigrantWorkers-in-the-United-States.pdf.

60 “H-2A Temporary Agricultural Workers.” USCIS, 8 Mar. 2018, www.uscis.gov/working-unitedstates/temporary-workers/h-2a-temporaryagricultural-workers.

61 Ribando, Clare. “Trafficking in Persons in Latin America and the Caribbean.” Organization of American States, Congressional Research Service, 15 Dec. 2005, http://www.oas.org/atip/ latin%20america/crs%20dec%202005.pdf.

62 Hobbes, Michael. “Why It’s Impossible To Shop Ethically.” The Huffington Post, TheHuffingtonPost.com, highline. huffingtonpost.com/articles/en/the-myth-ofthe-ethical-shopper/.

Photo Credits: Wally/Wikimedia Commons—page 48 Adman Payne/Wikimedia Commons—page 50

COMBATING COYOTES: FIGHTING LABOR TRAFFICKING IN U.S. AGRICULTURE / 53

ESSAY BY

AMAN ASIJA

Saving the

Cures of

the Future

The continued deforestation of the Amazon rainforest has led to significant losses not only for the environment but also in areas of pharmaceutical research. Aman Asjia explores the potential value that can be saved by pharmaceuticals company Pierre Fabre if it purchases rainforest land to protect and utilize its biodiversity.

THE CURRENT STATE OF THE AMAZON RAINFOREST

R

ampant corporate deforestation of the Amazon rainforest has resulted in a market failure wherein biodiversity has been put at significant risk. The Amazon is a hotspot for biodiversity: a single hectare of land, for instance, can contain a hundred species of trees.1 The Cocha Cashu Biological Station, which only encompasses a tenth of a hectare, is home to more than 1,856 species of plants. 2 In total, the Amazon accommodates at least ten percent of the world’s known biodiversity.3 Scientists have currently distinguished over 40 thousand unique plant species, of which 75 percent are endemic—only to be found within the borders of the rainforest.4 Unfortunately, with the continued destruction of the Amazon, these endemic plants may be lost forever.

The implications of biodiversity loss extend beyond negative environmental effects; they also interfere with the creation of pharmaceutical treatments.

Plant-based remedies are frequently lauded as invaluable alternatives to conventional medicine, and in praising these more natural cures, media sites often allude to the untapped potential of plants within the Amazon rainforest specifically. While sales of plant-derived pharmaceuticals exceeded $30 billion in 2002, there are still hundreds of thousands of plants in the Amazon whose complex biochemistries have yet to be analyzed and used.5 Two studies from the 1990s suggest just how important biodiversity has been and will be for medicine. An audit of the top 150 prescription drugs in 1993 found that over half of all prescriptions filled in the United States “contained at least one major active compound now or once derived . . . from biological diversity.” 6 Another study in 1997 by Harvard professor DJ Newman found similar results, concluding that 42 percent of sales for the top 25 selling drugs are derived from natural products.7

56 / AMAN ASIJA

While no similarly extensive studies have been conducted in recent years, one can assume that pharmaceuticals still prize and mass produce such natural drugs due to their highly successful “ability to target proteins coded by essential genes.”8 With future medicinal research at stake, it is crucial, now more than ever, that the plants of the Amazon are protected.

Unfortunately, due its high profit potential from pharmaceuticals and other resources, the Amazon is facing a state of overexploitation, or in economist William Foster Lloyd’s words, a “tragedy of the commons.”

Lloyd’s “tragedy of the commons” refers to a situation in which entities acting in their own self-interest ultimately deplete a public good, which is soon to be the case with the Amazon.9 From roots to bark to tips, corporations and collectors are seizing every inch of the rainforest possible, marking the Amazon as “probably the greatest market failure” and the “starkest example of a ‘tragedy of the commons’ the world has ever seen.”10 Unchecked market practices have given way to widespread destruction, and important plants and medicines have been lost along the way.

U n f o r t u n a t e l y, d e f o r e s t a t i o n threatening biodiversity is hardly a new phenomenon. In 1987, the U.S. National Cancer Institute funded a plant collection expedition in Belize, hoping to find novel cures to various cancers and the human immunodeficiency virus (HIV).11 Before they could collect multiple samples of a rare tree species that showed promise in combatting HIV, however, a logging company cut the tree down. 12 In this case and many others, the market took advantage of the lack of governmental protection and produced a harsh negative externality—the inability to explore and possibly develop essential cures.

EXPLORING GOVERNMENT

THE

ROLE

OF

In Brazil, the government’s close relationship with the market has resulted in limited regulation and increased deforestation. Rainforest protection has been de-prioritized by lobbying efforts

and political turmoil. 13 Furthermore, current president (as of May 2018) Michel Temer is “fast-tracking major development projects that will lead to further deforestation, including hydroelectric dams and highways.” 14 Driven by corporate interests, Brazil’s current administration does not bode well for the future of the Amazon.

A recent example of this deprioritization is the abolishment of the Renca reserve in the Northern Amazon.

The Brazilian government contended the decision was made to attract foreign investment, improve exports, and boost an economy that has been “struggling to emerge from its deepest recession in decades.” 15 An opposing senator, however, criticized the action as “the biggest attack on the Amazon of the last 50 years.” 16 Regardless, due in part to Temer’s anti-conservation views and Brazil’s dire economic conditions, the government caved to pressure from over 20 multinational firms and opened the land for mining.17 The removal of protection measures on the Renca reserve is not an isolated incident. As Christian Poirer of non-profit Amazon Watch stated: “Temer’s decision [has] to be seen in the context of wider efforts by his government to erode protected areas, weaken environmental licensing, and diminish indigenous rights in the interest of wealthy supporters in the extractive industries.”18 Poirer’s sentiment is matched by many activists, who point out that similar decisions have opened the floodgates for commercial exploitation and widespread destruction.

Temer’s policies are undeniably linked to increased deforestation in the Amazon.

In 2017, a study from the University of Vermont found that mining-related activity accounted for ten percent of all Amazon deforestation, the first time this factor has ever been considered “significant.” 19 Previous estimates suggested that mining caused “maybe one or two percent of deforestation”; the fact that deforestation has reached the ten percent threshold is “alarming and

warrants action.”20 Corporate support for the Brazilian government’s policies has worrying results for Amazon biodiversity as well.

Carlos Nobre, chair of Brazil’s National Institute of Science and Technology for Climate Chang e, and Thomas Lovejoy, professor at George Mason University, warned in a 2018 editorial that the deforestation of the Amazon will soon reach a threshold leading to “irreversible changes that transform the landscape into degraded savanna with sparse, shrubby plant cover and low biodiversity.”21 Their research found that rampant deforestation, when combined with increasing climate change, poses an immediate threat to biodiversity.22 Thus, each day, biodiversity is placed in greater peril, and potential pharmaceutical

“

over 130 countries including Brazil.23, 24 The company is best known for its anticancer drug vinorelbine (Navelbine), a vinca alkaloid that is derived from the Madagascan periwinkle Catharanthus roseus L.25 The drug is comprised of “such complex molecular architecture” that relying solely on laboratory chemical synthesis would make it too expensive to treat patients. Thus, even today, drug manufacturers rely on natural cultivation to provide this key medicine.26 Such drug complexity is not unique to the periwinkle.

In fact, the chemical structures of most natural drugs are very complex, and because “simple extraction is usually less expensive than synthesis,” 90 percent of higher plant-based prescription drugs involve direct extractions. 27 For

important in fighting cancer—70 percent of plants identified to have potential anticancer properties by the United States National Cancer Institute are endemic to rainforests—protecting it directly aligns with Pierre Fabre’s philosophy, research goals, and business model.30 Preventing deforestation would thus allow Pierre Fabre to not only make a profit but also create opportunities for better cures and save rich areas of biodiversity.

CREATING SHARED VALUE

How can Pierre Fabre conserve the Amazon in a way that is also economically beneficial? The primary factors driving the Amazon’s destruction are largescale: climate change, deforestation, and land-use change. 31 Correcting for these underlying issues would require

From roots to bark to tips, corporations and collectors are seizing every inch of the rainforest possible, marking the Amazon as . . . the ‘starkest example of a “tragedy of the commons” the world has ever seen.’”

treatments are lost. But the government is in a position to change this. While the current administration is unwilling to directly intervene, it has shown enthusiasm for corporate partnerships, thus creating an opportunity for a business to step forth and profit and reduce deforestation simultaneously.

ENTER PIERRE FABRE

One company that has already realized the potential of rare medicinal plants and is in a unique position to act is Laboratories Pierre Fabre, a French multinational pharmaceutical and cosmetics company that operates in

companies that thrive on sophisticated endemic plants, protecting the Amazon and its biodiversity is key.

Pierre Fabre is already one of the most active plant researchers: it owns the largest private collection of plant samples in the world, generates 40 percent of its turnover using products containing active plant-based substances, and develops between three and five new active plant-based active substances annually. 28 Biodiversity is crucial to Pierre Fabre, specifically for its prominent anti-cancer division to which it devotes over half of its R&D budget.29 And because the Amazon is particularly

resources much larger than any one company can provide. Pierre Fabre can spearhead change, however, by first purchasing sections of land that would otherwise be ravaged by other groups.

If the price of the land is less than its potential pharmaceutical value, there may be enough incentive to support a marketbased conservation of biodiversity.

Ultimately, the selling price of rainforest land is determined by its controlling government. Fortunately, Temer’s administration in Brazil has repeatedly demonstrated its openness to corporate action in the Amazon. In 2013, for example, it revisited the Brazilian

SAVING THE CURES OF THE FUTURE / 57

Forest Code to revise conservation plans for the Amazon.32 Reviewing legislation such as the Forest Code helps the government better appraise the value of rainforest land.

The theoretical benefits of rainforest land, however, make it extremely difficult for lawmakers to decide on an exact price point. They must not only ascertain local value but also assess global conditions, such as the value of carbon preserved when the land is not utilized.

Furthermore, finding “true” protection values of particular parts of the forest can be “complicated and controversial,” in part due to strong interaction effects: the removal of rainforest land in one area, for example, can have “synergistic effects on other areas” and even induce “‘tipping points’ whereby catastrophic changes may be triggered.”33 These confounding v a r i a b l e s h ave m a d e i t v i r t u a l l y impossible to predict future selling prices of Amazon land, so the next best option is to review past deals that have been made.

In 2016, Ecuador sold one-third of its Amazon property to Chinese oil companies. The deal was $80 million f o r r o u g h l y 5 0 0 t h o u sa n d a c r e s, approximately $395 per hectare. 34 In the same year, a 221-acre plot of land in Brazil’s Atlantic Forest sold for $56 thousand, roughly $630 per hectare.35 Both sales touted some of the most biodiverse regions in South America, and therefore can help provide an estimate of

what Pierre Fabre can expect as a price when purchasing biodiverse areas of land.

While knowing the selling price of the land is important, Pierre Fabre must also determine its potential pharmaceutical value to drive a profitable and sustainable transaction. It can use a process known as “bioprospecting” to appraise the financial value of land based on its potential for creation of medicinal drugs.36 The most recent bioprospecting survey of the Amazon was conducted in year 2000, utilizing past pharmaceutical research and cures as the basis for assumptions in its numerical model. Researchers concluded that bioprospecting can be “large enough to finance meaningful biodiversity conservation,” and that the most valuable sites are potentially worth between $9 thousand and $11 thousand per hectare.37 At present, these values exceed the cost of the land, thus providing a significant economic incentive for Pierre Fabre to take on this initiative and begin research.

There are, however, potential issues after the acquisition of land; for instance, other stakeholders may impede Pierre Fabre’s research plans. Business projects based on biodiversity must first receive approval by the Ministry of Environment’s genetic research and development board Conselho de Gestao do Patrimonio (CGEN) before moving forward. 38 CGEN, which must balance the needs of scientists against those of indigenous people, is notorious for blocking

AMAN ASIJA I wanted to come up with a feasible solution that would help save the Amazon while also providing an opportunity for a business. Utilizing the rainforest’s resources for its medicinal properties seemed intuitive to accomplishing both objectives.

58 / AMAN ASIJA

business projects focused primarily on technological advancement. 39 Even if CGEN approves of Pierre Fabre’s plan, the process of receiving an official permit can then take up to five additional years due to inefficient regulatory procedures. In 2011, CGEN only granted 86 permits, with over 150 requests still pending.40 Despite the Temer administration’s corporate leanings, the complex relationship between other governmental agencies, the people they represent, and Pierre Fabre still poses a potential roadblock.

Additionally, land price is not the only cost when undertaking such a project. Pierre Fabre will also have to allocate additional resources to its location in Brazil, incur higher R&D costs, and perhaps even open a new site.

Nevertheless, a 2013 research study on the value of the Amazon rainforest concluded that the potential for investment in plantbased pharmaceuticals and cosmetics in Brazil is still highly favorable.41 Given Pierre Fabre’s vast resources and expertise, it can likely lead this endeavor and make it a reality. As a firm with over 50 years of operating experience, Pierre Fabre continues to invest heavily in its medical research; in recent years, it invested $172 million annually in R&D.42 As such, the initial setup costs for this project would only represent a mere fraction of its total allocated budget.

Pierre Fabre is thus in a good position to wield the potential of the Amazon rainforest.

CLASS OF 2021 • FINANCE

HEADING TOWARDS A BIODIVERSE FUTURE

Over the last few years, Temer’s administration has exposed the Amazon and its biodiversity to increased risk.

How e ve r, w i t h t h e g ove r n m e n t ’s pro-corporation policies comes an opportunity for businesses to step in and

take action themselves. Pierre Fabre, a global pharmaceuticals company that has already found success in obscure plant research, can lead the charge to preserve biodiversity in the Amazon rainforest.

It can purchase land that has far more potential value than the current selling price, and while the company may run

“Amazon Plants and Trees.” WWF Global, wwf.panda.org/what_we_ do/where_we_work/amazon/about_the_amazon/wildlife_amazon/ plants/.

2 Foster, Robin B. “The Floristic Composition of the Rio Manu Floodplain Forest.” Four Neotropical Rainforests, by Alwyn H. Gentry, Yale University Press, 1990.

3 “About the Amazon.” WWF Global, wwf.panda.org/what_we_do/ where_we_work/amazon/about_the_amazon/.

4 “Plants.” Amazon Aid Foundation, amazonaid.org/plants/.

5 Kingston, David G. I. “Modern Natural Products Drug Discovery and Its Relevance to Biodiversity Conservation.” NCBI, U.S. National Library of Medicine, 25 Mar. 2011, www.ncbi.nlm.nih.gov/pmc/ articles/PMC3061248/.

6 Grifo, Francesca, et al. “The Origins of Prescription Drugs.”

Biodiversity and Human Health, by Francesca Grifo and Joshua Rosenthal, Island Press, 1997.

7 Newman, D.J., and S.A. Laird. “The Influence of Natural Products on 1997 Pharmaceutical Sales Figures.” The Commercial Use of Biodiversity: Access to Genetic Resources and Benefit-Sharing, by Kerry ten. Kate and Sarah A. Laird, Earthscan Publ., 1999.

8 Kingston, David G. I. 9 “Tragedy of the Commons.” Wikipedia, Wikimedia Foundation, 30 Apr. 2018, en.wikipedia.org/wiki/Tragedy_of_the_commons.

10 Nobre, Carlos A., et al. “Land-Use and Climate Change Risks in the Amazon and the Need of a Novel Sustainable Development Paradigm.” PNAS, National Academy of Sciences, 27 Sept. 2016, www.pnas.org/content/113/39/10759.

11 Cragg, Gordon M, and David J Newman. “The U.S. National Cancer Institute’s Approach to the Discovery and Development of New Drugs for the Treatment of Cancer and AIDS: A Report on Plants Evaluated from Collections in Belize During 1987–1996 .” Messages from the Gods: a Guide to the Useful Plants of Belize, by Michael J. Balick and Rosita Arvigo, Oxford University Press, 2015.

12 “Owed to Nature: Medicines from Tropical Forests.” Rainforest Trust, 31 Aug. 2017, www.rainforesttrust.org/news/owed-to-naturemedicines-from-tropical-forests/.

13 Schiffman, Richard. “Amazon Rainforest under Threat as Brazil Tears up Protections.” New Scientist, www.newscientist.com/ article/2129024-amazon-rainforest-under-threat-as-brazil-tearsup-protections/.

14 Ibid.

15 Ibid.

16 “Watts, Jonathan. “Brazil Abolishes Huge Amazon Reserve in ‘Biggest Attack’ in 50 Years.” The Guardian, Guardian News and Media, 24 Aug. 2017, www.theguardian.com/environment/2017/aug/24/ brazil-abolishes-huge-amazon-reserve-in-biggest-attack-in-50years.

17 Ibid.

18 Ibid.

19 “New Amazon Threat? Deforestation from Mining.” Phys.org, University of Vermont, phys.org/news/2017-10-amazon-threatdeforestation.html.

1

into some regulatory hurdles, Pierre Fabre has the experience, resources, and economic incentives to overcome them.

Through the acquisition of bio-rich areas of the Amazon rainforest, Pierre Fabre will be generating profits, protecting biodiversity, and producing cures of the future.

Ibid.

“Amazon Deforestation Is Close to Tipping Point.” Phys.org, Sao Paolo Research Foundation, phys.org/news/2018-03-amazondeforestation.html.

22 Nobre, Carlos A., et al.

23 “Laboratoires Pierre Fabre.” Wikipedia, Wikimedia Foundation, 10 Apr. 2018, en.wikipedia.org/wiki/Laboratoires_Pierre_Fabre.

24 “Darrow.” Pierre Fabre, www.pierre-fabre.com/en/darrow.

25 “Vinorelbine.” Wikipedia, Wikimedia Foundation, 30 Apr. 2018, en.wikipedia.org/wiki/Vinorelbine.

26 “Owed to Nature: Medicines from Tropical Forests.”

27 “Medicinal Treasures of the Rainforest.” Adventure Life, www. adventure-life.com/amazon/articles/medicinal-treasures-of-therainforest.

28 “Plant Research.” Pierre Fabre, www.pierre-fabre.com/en/plantresearch-0.

29 “Biography of Pierre Fabre.” Zonebourse, www.zonebourse.com/ barons-bourse/Pierre-Fabre-119/biographie/.

30 “Medicinal Treasures of the Rainforest.”

31 Nobre, Carlos A., et al.

32 May, Peter H., et al. “How Much Is the Amazon Worth? The State of Knowledge Concerning the Value of Preserving Amazon Rainforests.” Policy Research Working Papers, 2013, doi:10.1596/1813-9450-6668.

33 Ibid.

34 Kaiman, Jonathan. “Controversial Ecuador Oil Deal Lets China Stake an $80-Million Claim to Pristine Amazon Rainforest.” Los Angeles Times, Los Angeles Times, 29 Jan. 2016, www.latimes.com/world/ mexico-americas/la-fg-ecuador-china-oil-20160129-story.html.

35 “Hunting in the Atlantic Forest.” World Land Trust, 20 July 2016, www.worldlandtrust.org/news/2016/07/hunting-atlantic-forest/.

36 “What Is Bioprospecting? - Definition & Examples.” Study.com, Study.com, study.com/academy/lesson/what-is-bioprospectingdefinition-examples.html.

37 Rausser, Gordon C., and Arthur A. Small. “Valuing Research Leads: Bioprospecting and the Conservation of Genetic Resources.”

Journal of Political Economy, vol. 108, no. 1, 2000, pp. 173–206., doi:10.1086/262115.

38 May, Peter H., et al.

39 Castro, Luiz. “The Future of Sustainable Use Biodiversity in Brazil.”

Nature News, Nature Publishing Group, 24 Mar. 2015, blogs.nature. com/tradesecrets/2015/03/24/the-future-of-sustainable-usebiodiversity-in-brazil.

40 May, Peter H., et al.

41 Ibid.

42 “Key Figures.” Pierre Fabre, www.pierre-fabre.com/en/key-figures.

20 21

Photo Credits: NASA Earth Observatory/Wikimedia Commons—page 54 Sam Beebe/Flickr—page 57

SAVING THE CURES OF THE FUTURE / 59

Entrenched in historic precedence and perpetuated by the War on Drugs, black incarceration and recidivism rates are excessively high in the city of Chicago. Dharaa Rathi sees an opportunity for the Safer Foundation to step forward and train ex-felons to give back and rebuild their communities.

BLACK IMPRISONMENT ENDS WITH

BLACK EMPLOYMENT ESSAY BY

DHARAA RATHI

E

ver since the reaganera War on Drugs, inner-city black communities in particular have been targeted by the government in its efforts to rid American society of drugs.

“Mandatory minimums,” the most notorious product of the War on Drugs, are sets of excessively harsh laws regulating drug possession, usage, and dealing that swept across the country in the 1990s.

They serve as a narrow “one size fits all” approach, giving judges little discretion to adjudicate defendants’ individual cases. 1 Moreover, because sentencing for drug-related offenses is extensive and often racially targeted, government resources are used to imprison thousands of black men for excessive periods of time rather than rehabilitate communities and lower crime rates.

In the United States, approximately one in every nine black children has an incarcerated parent, as compared to just one in 57 white children.2 The city of Chicago, with its deeply segregated and historically impoverished black population, is hardly the exception to this tragic reality.

The current majority of Illinois’ prison population is black despite the fact that blacks only comprise a mere 15 percent of the state’s overall population. Not only is the rate of incarceration for black men high across all neighborhoods, but almost half of these inmates return to prison within three years of their initial release.3 Chicago suffers under its failing criminal justice system; rather than build safe and strong communities, it has created some of the deadliest neighborhoods in the country marked with rampant drug trade and cycles of black incarceration.

Both the prevalence and obscurity of mandatory minimum laws have prevented Illinois from implementing reforms to address the problems of the justice system. Many attempts to modify obsolete clauses have been met with resistance. Furthermore, white residents have little incentive to take action themselves. With most of the crime and poverty contained to segregated black and

Latino neighborhoods, the uninvolved can easily turn a blind eye.4 Due to their lack of awareness of such policies, many white voters view current “tough-oncrime” laws simply as warranted safety measures.

Another consequence of incarceration is that those who are waiting out their sentences lose their ability to vote. 5 Because lawmakers ultimately support the voting population with the most influence, mandatory minimums will continue to disproportionately incarcerate black men. Even with out-ofcharacter reforms, like Illinois Governor Rauner’s recent push to enfranchise citizens by signing laws that help exfelons search for employment, change is slow. 6 To truly mitigate the cycle of targeted incarceration of black men in Chicago, a social enterprise that can surpass government policies must take action, providing resources that empower community youth while helping exfelons re-enter society in a sustainable, profitable, and legal way.

The current situation faced by Chicago’s black communities stems from the city’s historical segregation, particularly through two institutional policies. One policy allowed the state g ove r n m e n t t o m ove p o o r w h i t e communities out of city limits. In the 1980s, the government only backed mortgages for white homeowners, leading to the phenomenon of “White Flight,” or the mass exodus of middleclass white families into suburbs and rural areas. The second policy allowed the government to create low-income

62 / DHARAA RATHI

housing in inner-city neighborhoods; however, it still did not back home mortgages for black families. Thus, newly integrated black families searching for a city-level income were funneled to inner-city projects.7 The effects of both policies have lasted to this day: South and West Chicago are predominantly black and Latino, while North Chicago is affluent and predominantly white.8 In other words, concentrated poverty in the city exists only within black and Latino neighborhoods—groups that never truly had fair opportunities for success.

The historical bias of past policies also influences the way the Illinois government enforces policies from the War on Drugs period. Prosecutors inflate the sentences required by mandatory minimum laws by manipulating sentence durations associated with various crimes.

They have virtually unchecked power in brokering plea deals for the individuals awaiting trial. By leveraging fine details of mandatory minimums, such as proximity to schools or speaking with someone involved in gang activity alongside the perpetrator, prosecutors can raise the duration of criminal sentences by several years. Young black men who are caught are then pressured into taking these unreasonable deals, thus funneling them into the cycle of incarceration. Due to judge indifference and partiality towards tough-on-crime policies, the Illinois government has not taken significant action to amend these laws. As a result. black incarceration continues to rise exponentially.9

Austin, a West Side black-majority neighborhood, has felt the full force of mandatory minimums and racial marginalization. In fact, streets in Austin that consistently add to Cook County Jail’s head count are referred to as “million-dollar blocks.” 10 The nickname reflects the monetary value of prison sentences for residents along these blocks, which, for Austin alone, totaled $644 million over the last ten years. Moreover, because these blocks are boarded up, black residents living here have little opportunity to become financially independent within the law.11 In a piece from the Chicago Reporter, community leaders acknowledged the clear culpability of young men arrested for drug crimes; however, they also stress that these ex-incarcerates have little chance to restart their lives once released. Reginald Bachus, the pastor of a church in Austin, notes the existence of a “domino effect”: the police are “arresting young men, but there’s nothing in [their] community for them to do.”12 As a result, the median household income for Austin straddles the poverty line and is not even half the income in white, North Side neighborhoods—a trend that is observable across all black areas in Chicago.13 Senator Patricia Van Pelt, the state representative for Austin, attempted reforms similar to Illinois Governor Bruce Rauner’s by removing barriers to employment. 14 Her policy, which offers tax incentives to businesses who hire ex-offenders, hopes to increase the proportion of Austin residents who hold jobs in the community, which

“

Rather than build safe and strong communities, Chicago has created some of the deadliest neighborhoods in the country marked with rampant drug trade and cycles of black incarceration.”

is currently only one in ten. While Austin residents seem to be in favor of this policy, however, the scarcity of jobs—resulting from the deprivation of resources in black neighborhoods with high incarceration rates—negates the increased ease in finding them.15 Thus, recidivism continues to occur at a high rate alongside an increasingly rampant drug trade, which places the burden of change on the communities themselves.16 Social justice groups based in Chicago have taken on this obligation, with many attempting to re-enfranchise ex-felons.

Most programs directed towards exinmates provide anger management classes or job training workshops. An article about East Harlem, New York—a neighborhood with similar struggles to Austin’s—encapsulates the importance of such tactics: “‘It’s really easy to commit crime when you can persuade yourself that no one else out there is convinced of your rehabilitation,’ said Martin, an exoffender who served six years in prison.”17 Unfortunately, with few government resources to spend on rehabilitation and a taxpayer cost of $40,987 per recidivism occurrence, Austin’s “million dollar block” reputation remains strong. 18 To ensure that proper attention is given to ex-felon rehabilitation and retraining, outside actors must step in.19 The Safer Foundation is one such organization in the Chicag o area that can help break the cycle of black imprisonment. It tackles incarceration and recidivism in a variety of ways, from providing education programs to teens in juvenile detention centers to offering job

search services to ex-felons. Its programs range from behavioral health and financial management classes to interview prep and clothing assistance. The most unique aspect of the foundation, however, is its foundation-sponsored social enterprises.

These revenue-generating businesses train ex-felons to provide marketable services (e.g. Reconstruction Technology Partners, LLC, which instructs members in building and repair services) and directly assist them in finding suitable employment. With the Safer Foundation brand, consumers around Chicago are more likely to respect employees and their work.20 As a reputable foundation with significant resources and reach, the Safer Foundation can spearhead efforts to improve incarceration conditions in Chicago and other similar cities.21 However, for communities like Austin that lack the multitude of local businesses looking to hire ex-felons, where can these individuals utilize their training?

B r a n d o n F l o w e r s, a f o r m e r l y incarcerated drug dealer from Austin, has the answer: “If you give ex-cons jobs to help rebuild their community, they start to care about it...You know, give them the power back to their community. Give them the keys back to their community.”22 His idea suggests that Safer Foundation can maximize its effectiveness not only by improving the surrounding neighborhoods but also making use of the resources that already exist there.

In 2013, in order to cut expenses, Chicago Public Schools began the largest mass school closure in history; of the students affected, 88 percent were black

and from poor neighborhoods.23, 24 These closures have shut down at least 50 schoolareas that have yet to be sold, repurposed, and redeveloped, and the list continues to grow. Austin’s Emmet Elementary, for example, was sold in this wave, but it has been left untouched and will likely remain vacant due to developer complications and bureaucratic inefficiencies.25 While some areas have been redeveloped as health centers or senior living areas, neighborhoods on the West Side have been left with many unsold, unoccupied buildings.26 Coincidentally, these same areas, including Lawndale and Garfield, are the ones contributing most to the high recidivism rates of Cook County Jail.27 This systemic problem presents a distinct business opportunity for the Safer Foundation to take advantage of.

The foundation can establish a new social enterprise similar to Reconstruction Technology Partners that trains exfelons to redevelop and repurpose buildings, which are skills they can also use to rebuild their own communities. All required skills, including construction and entrepreneurship, can be taught through the foundation’s existing social enterprises.28, 29 The funding needed to buy and repurpose schools—around $75,000 based on local costs—can potentially be supported by a venture capital firm that specializes in financing businesses with a social impact purpose.30 Indeed, impact investing is gaining momentum across the country, and Chicago is no exception: Benefit Chicago, for example, is a fund that invests in organizations with a social mission, which the Safer Foundation

BLACK IMPRISONMENT ENDS WITH BLACK EMPLOYMENT / 63

easily qualifies as.31 This proposal combines two largely untapped assets in Chicago: ex-felons who desire to be financially independent and vacant property that can be redeveloped to generate revenue as well as uplift the surrounding neighborhood. To add to their appeal, redeveloped buildings can contain low-income housing along with community centers, which provide services people have been demanding since the shutdown of the local YMCA.32 The buildings can also serve as places for the Safer Foundation to expand its services locally. Revenues from these services, as well as the widespread credibility of the foundation, are likely to make this project appealing to Benefit Chicago and other impact funds.

Finally, this business is scalable beyond abandoned school lots, as school buildings are not the only vacant public properties in Chicago. With the help of ex-felons and other members of the community, the Safer Foundation can help break the cycle of black incarceration and build happier, healthier neighborhoods throughout the city.

A similar venture was previously attempted in Austin with the sale of a school to “Kidz Express,” a group who has used the space for youth counseling, tutoring, and programming. 33 The organization is based in South Austin with the goal to “develop innovative, affordable neighborhood programs to address many of the challenges facing low income at-risk youth and their families

in difficult urban environments that can be replicated in other neighborhoods.”

Its website reflects on the success of its programming, and graduates often return to volunteer. Kidz Express has lasted for over ten years with a purpose similar to the proposed community center’s.

Of course, there are risks in this proposal. There is the possibility that the government may not want to sell to Safer’s enterprise. However, the primary requirement to receive the rights to the building is for the receiver to be the highest bidder. Moreover, these schools have been vacant for so long because developers assumed that these neighborhoods would never be profitable.

This proposal rejects that notion, instead capitalizing on the neighborhood’s necessity for both affordable housing as well as a new community center, services that generate revenue and a business model that a fund like Benefit Chicago would invest in.

Another risk is that ex-felons may not want to be involved in this venture. However, partnering with the Safer Foundation mitigates this risk significantly, as it has shown continued success and impact through its programs working with ex-felons. As Brandon Flowers said, the inmates returning to the South and West Sides would rather help build their communities while gaining an income, than go back to jail. Another mitigation is to work with local churches, influential groups in black neighborhoods in Chicago. Many churches are activist

DHARAA RATHI Though inspired by modern pop culture references from Kanye West’s music and the television show Shameless, my paper on black incarceration deals with a longstanding issue that is the result of centuries of policy and racial bias. In order to change the situation, particularly in the city of Chicago, I argue that outside help cannot always be relied on and that the most effective changes often come from within the community itself.

64 / DHARAA RATHI

groups as well and could use their establishments in their communities to persuade ex-felons to participate in the program to help stay out of prison.

Overall, the biggest reason Kidz Express worked—and why this proposal can work—is simply because neighborhoods like Austin and Lawndale need these resources. Mandatory minimums are set with no foreseeable end; even with Governor Rauner’s effort to reform, other lawmakers have ignored the Governor’s committee on criminal justice’s advice to alter or repeal mandatory minimums. 34 Large populations are looking for work in areas with very little opportunity; it is time to create the prospects of work in the neighborhoods that need them.

The proposal does not alter the original culture or structure of an area.

Residents were already wary about the vacant buildings long before the schools were shut down, and have voiced their concerns. “We’re going to have abandoned buildings that destabilize the neighborhoods around them,” said Karen Lewis, president of the Chicago Teachers Union.35 So why not provide all the benefits that a school once did? This is a space for older ex-felons to mentor younger kids by sharing hard-learned lessons through their life-stories. This is a space for all ages to feel safe and welcomed. This is a space where communities can begin to finally tear down black incarceration on their own.

CLASS OF 2021 • BUSINESS & POLITICAL ECONOMY

“Quick Facts.” FAMM. Accessed March 28, 2018. http://famm.org/ sentencing-101/quick-facts/.

2 “Race and the Drug War.” Drug Policy Alliance. Accessed April 30, 2018. http://www.drugpolicy.org/issues/race-and-drug-war.

3 “Illinois Prison Overview.” Illinois State Commission on Criminal Justice and Sentencing Reform. April 22, 2015. Accessed April 30, 2018. http://www.icjia.org/cjreform2015/research/illinois-prisonoverview.html.

4 Marin, Carol, and Don Moseley. “Where Do Released Inmates Go?” NBC Chicago. May 08, 2014. Accessed April 30, 2018. https:// www.nbcchicago.com/investigations/Released-Inmates-FaceRoadblocks-Adjusting-to-Society-258402151.html.

5 “Voting as an Ex-Offender.” Nonprofit Vote. Accessed March 28, 2018. http://www.nonprofitvote.org/voting-in-your-state/specialcircumstances/voting-as-an-ex-offender/.

6 “Gov. Rauner Signs Several Criminal Justice Bills, Blasts Racism.” The Chicago Defender. August 25, 2017. Accessed April 30, 2018. https:// chicagodefender.com/2017/08/25/gov-rauner-signs-severalcriminal-justice-bills-blasts-racism/.

7 Yousef, Odette. “Where Are Chicago’s Poor White Neighborhoods?”

WBEZ. Accessed March 27, 2018. https://www.wbez.org/ shows/curious-city/where-are-chicagos-poor-whiteneighborhoods/37e96521-d730-43b8-b645-633aab318314.

8 Ihejirika, Maudlyne. “Health Study Finds Huge Disparities Based on Race, Neighborhood.” Chicago Sun-Times. March 23, 2017. Accessed March 27, 2018. https://chicago.suntimes.com/news/health-studyfinds-huge-disparities-based-on-race-neighborhood/.

9 Kozlowska, Hanna. “America’s Prison Crisis Can’t Be Fixed until We Realize We’ve Been Looking at the Problem Wrong.” Quartz.

March 09, 2017. Accessed March 28, 2018. https://qz.com/923037/ americas-mass-incarceration-crisis-cant-be-fixed-until-we-realizewe-have-been-looking-at-the-problem-all-wrong/.

10 Olson, David E. “Characteristics of Inmates in the Cook County Jail.” Loyola E-Commons. April 1, 2011. Accessed April 29, 2018. https://ecommons.luc.edu/cgi/viewcontent. cgi?article=1003&context=criminaljustice_facpubs.

11 Caputo, Angela. “Cell Blocks.” Chicago Reporter. July 27, 2015.

Accessed March 27, 2018. http://www.chicagoreporter.com/cellblocks/.

12 Ibid.

13 “Community Health Counts: Sinai Community Health Survey 2017.” Scribd. Accessed March 27, 2018. https://www.scribd. com/document/342808573/Community-Health-Counts-SinaiCommunity-Health-Survey-2017#fullscreen&from_embed.

14 Krevlin, Sam. “Illinois Senate Passes Criminal Justice Reform Bill.”

The Daily Northwestern. April 27, 2017. Accessed April 30, 2018. https://dailynorthwestern.com/2017/01/18/city/illinois-senatepasses-criminal-justice-reform-bill/.

15 Ibid.

16 Board, Editorial. “At Last, Criminal Justice Reforms - Don’t Blow It.” Chicagotribune.com. August 27, 2016. Accessed April 30, 2018. http://www.chicagotribune.com/news/opinion/editorials/ ct-criminal-justice-reforms-illinois-rauner-edit-0826-20160824story.html.

17 Lee, Trymaine. “Times Of Trouble: Ex-Offenders Struggle To Escape Past Lives.” The Huffington Post. December 07, 2017. Accessed April 30, 2018. https://www.huffingtonpost.com/2012/06/09/recidivismharlem-convicts_n_1578935.html.

18 “The High Cost of Recidivism.” ICJIA. June 2015. Accessed April 29, 2018. http://www.icjia.state.il.us/spac/pdf/Illinois_Results_ First_1015.pdf.

19 “Half of the Inmates Shouldn’t Be Here, Says Cook County Sheriff.”

FAMM. Accessed April 30, 2018. http://famm.org/half-of-theinmates-shouldnt-be-here-says-cook-county-sheriff/.

20 Reconstruction Technology Partners, LLC. Accessed April 30, 2018.

1

http://www.saferfoundation.org/Reconstruction-TechnologyPartners.

21 “Employment Services.” Community-Based Services. Accessed April 30, 2018. http://www.saferfoundation.org/How-We-Help/ Employment-Services.

22 Caputo, Angela. “Cell Blocks.” Chicago Reporter. July 27, 2015.

Accessed March 27, 2018. http://www.chicagoreporter.com/cellblocks/.

23 Belsha, Kalyn, and Matt Kiefer. “What Happened to the Closed School in Your Neighborhood?” Chicago Reporter. April 23, 2018.

Accessed April 30, 2018. http://www.chicagoreporter.com/whathappened-to-the-closed-school-in-your-neighborhood/#emmet.

24 Rich, Steven Yaccino and Motoko. “Chicago Says It Will Close 54 Public Schools.” The New York Times. March 21, 2013. Accessed April 30, 2018. https://www.nytimes.com/2013/03/22/education/ chicago-says-it-will-close-54-public-schools.html.

25 Belsha, Kalyn. “Closed Schools Could Remain Vacant without Public Subsidy.” Chicago Reporter. October 12, 2017. Accessed April 30, 2018. http://www.chicagoreporter.com/closed-schools-scooped-upby-developers-could-remain-vacant/.

26 Belsha, Kalyn, and Matt Kiefer. “What Happened to the Closed School in Your Neighborhood?” Chicago Reporter. April 23, 2018.

Accessed April 30, 2018. http://www.chicagoreporter.com/whathappened-to-the-closed-school-in-your-neighborhood/#parkman.

27 Olson, David E. “Characteristics of Inmates in the Cook County Jail.” Loyola E-Commons. April 1, 2011. Accessed April 29, 2018. https://ecommons.luc.edu/cgi/viewcontent. cgi?article=1003&context=criminaljustice_facpubs.

28 Social Enterprise. Accessed April 30, 2018. http://www. saferfoundation.org/Social-Enterprise.

29 Aspire Entrepreneur Initiative. Accessed April 30, 2018. http://www. saferfoundation.org/Aspire-Entrepreneur-Initiative.

30 Belsha, Kalyn, and Matt Kiefer. “What Happened to the Closed School in Your Neighborhood?” Chicago Reporter. April 23, 2018.

Accessed April 30, 2018. http://www.chicagoreporter.com/whathappened-to-the-closed-school-in-your-neighborhood/#parkman.

31 “Benefit Chicago Is a New Collaboration That Aims to Mobilize $100 Million for Impact Investments for Nonprofits and Social Enterprises Working throughout the Chicago Region.” Benefitchi. org. Accessed April 30, 2018. http://www.benefitchi.org/.

32 Black, Curtis. “Closing South Chicago YMCA Continues Neighborhood Divestment Trend.” Chicago Reporter. November 06, 2017. Accessed April 30, 2018. http://www.chicagoreporter.com/ closing-south-chicago-ymca-continues-neighborhood-divestmenttrend/.

33 Belsha, Kalyn, and Matt Kiefer. “What Happened to the Closed School in Your Neighborhood?” Chicago Reporter. April 23, 2018.

Accessed April 30, 2018. http://www.chicagoreporter.com/whathappened-to-the-closed-school-in-your-neighborhood/#leland.

34 Krevlin, Sam. “Illinois Senate Passes Criminal Justice Reform Bill.”

The Daily Northwestern. April 27, 2017. Accessed April 30, 2018. https://dailynorthwestern.com/2017/01/18/city/illinois-senatepasses-criminal-justice-reform-bill/. https://dailynorthwestern. com/2017/01/18/city/illinois-senate-passes-criminal-justicereform-bill/.

35 Rich, Steven Yaccino and Motoko. “Chicago Says It Will Close 54 Public Schools.” The New York Times. March 21, 2013. Accessed April 30, 2018. https://www.nytimes.com/2013/03/22/education/ chicago-says-it-will-close-54-public-schools.html.

Photo Credits: With permission from Greyston Bakeries: https://greyston.org— page 60 Safer Foundation—page 62

BLACK IMPRISONMENT ENDS WITH BLACK EMPLOYMENT / 65

the call for corporate action

LEFT TO RIGHT: Zach Asato, Pooja Narayanan, Amy Dong, Professor Jeffrey J. Younger, Tara Rangwani, Jane Lin, Jessica Fung

Amy Dong senior editor

Jane Lin senior editor

Pooja Narayanan senior editor

Tara Rangwani senior editor

Jessica Fung design editor

Zach Asato photographer

66 / ACKNOWLEDGEMENTS

acknowledgements

we heartily congratulate the ten student writers published here and extend a warm thank you to all the numerous contributors to this sixth edition of The Call.

I thank all for their hard work and dedication.

We collected over 600 student essays from Business and Its Publics 2018, and all these writers are the ultimate inspiration for this magazine. It is our hope that current and future writers are moved by the high caliber of their prose and the challenging ideas contained in this work.

We selected the winning essays based on a number of criteria. We sought compelling content, powerful composition, and evidence of critical thinking. We looked for specific “calls for corporate action” that were realistic, creative, passionate, and unique. Ultimately, we wanted to present a mix of current student thinking across a complementary collection of topics. And finally, to demonstrate the complexity of societal connections, we looked for interesting insights into the interrelations between business, society, and government.

This publication was written, assembled, and edited by NYU students—most notably by our editors Pooja Narayanan, Jane Lin, Tara Rangwani, and Amy Dong—with timely editorial help from office assistants, Ahmed Razin, Christine Yen, Kristina Zheng, Meng Yu, Olivia Price, and Tazeen Siwani; thank you. We also could not have completed this publication without our talented art designer/graphic artist/photographer, Jessica Fung, and cover photographer, Zach Asato. Jessica’s beautiful work is present on every page, and our dramatic cover speaks for itself.

Thank you to NYU Stern Undergraduate Dean Geeta Menon for her gracious opening letter and to Professor Matt Statler for his

introduction to the current Business and Society course (formerly titled Business and Its Publics).

Thank you also to the dedicated instructors who facilitate the weekly discussions, critical thinking, and writing sessions that make up Business and Society.

Their instruction is evident within all these essays. Without their dedication this publication would not have been possible.

Thanks are due to all: Alec Applebaum, Aya Tanaka, Azish Filabi, Barbara Holt, Batia Wiesenfeld, Brian Hanssen, Bruce Buchanan, Bruce Meyerson, Caroll Newell, Casey O’Connor, Claudia Caruana, David Segall, Eileen Gilmartin, Ellen Pluta, Irv Schenkler, JanaLee Cherneski, Jeff Carr, Jessy Hsieh, Joe Foudy, Jorge Fortanez, Larry Menna, Larry White, Laura Noren, Maria Patterson, Mark Brennan, Matt DeBord, Matt Statler, Mira Dewji, Paul Melton, Rachel Kowal, Reima Shakeir, Robb Shoaf, Rob Lyon, Robert DiYanni, Robert Wosnitzer, Shelly London, Sophie Rifkin, Tara Wadhwa, Tim Gilman, Tim Glencross, and Tim Wood.

Finally, for all their support and guidance, I would like to separately thank Bruce Buchanan, C.W. Nichols Professor of Business Ethics and Director of the Business & Society Program; Batia Wiesenfeld, the Andre J.L. Koo Professor of Management and Chair of the Management and Organizations Department; Matt Statler, Richman Family Director of Business Ethics and Social Impact Programming; Susan Stehlik, Director of the Management Communication Program; Mara van Loggerenberg, Associate Director of Social Impact Programming; and Janeece Lewis, Senior Administrator of Management Communication.

Thank you, one and all.

JEFFREY J. YOUNGER Clinical Associate Professor, Management Communication

ACKNOWLEDGEMENTS / 67