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TikTok’s C.E.O. Struggles to Make His Case in Washington

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TikTok’s C.E.O. Struggles to Make His Case in Washington

The C.E.O. of TikTok was grilled for practically 5 hours in Congress on Thursday about his firm’s ties to China, and his testimony did little to recommend the video platform’s issues are over. The aggressive questioning of Shou Chew has solely added gasoline to fiery U.S.-China relations and highlighted TikTok’s awkward place as a battleground between Washington and Beijing. The Biden administration needs TikTok’s Chinese language proprietor ByteDance to promote the corporate or face a ban, however hours earlier than Mr. Chew testified, China stated it opposed a sale.

How did Chew fare? It was at all times going to be powerful for Mr. Chew to placate his interrogators, given the extent of bipartisan anti-China sentiment in Washington. However many thought his look went even worse than anticipated, regardless of the corporate’s monthslong effort to win associates and affect coverage forward of the listening to.

Lawmakers often reduce him off midsentence and repeatedly requested if TikTok was spying on People on behalf of the Chinese language authorities. “ByteDance isn’t owned or managed by the Chinese language authorities,” he stated, in a response that failed to steer them.

What did we be taught? “The way forward for TikTok within the U.S. is unquestionably dimmer and extra unsure as we speak,” Lindsay Gorman, head of expertise and geopolitics on the German Marshall Fund suppose tank and a former tech adviser to the Biden administration, instructed The Occasions.

How are traders responding? Mr. Chew tried to allay considerations about Chinese language involvement in ByteDance partly by pointing to its large U.S. traders, together with BlackRock, KKR and Sequoia Capital. But when they’re attempting to assist, they aren’t speaking. BlackRock and KKR declined to remark and Sequoia didn’t reply to DealBook’s question.

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Shares of TikTok’s U.S. opponents, together with Snap and Meta, rose throughout Mr. Chew’s testimony. However the U.S. corporations shouldn’t wager on a ban: It’s not clear the Biden administration has the authorized authority to impose one, or that it’s well worth the potential political price, given the thousands and thousands of younger People who use the app.

How did TikTokers reply? Principally with mockery and disbelief on the lawmakers’ tech information. “You may’t make this up 😂” one consumer wrote after Buddy Carter, Republican of Georgia, requested Mr. Chew if TikTok makes use of cellphone cameras to evaluate customers’ pupil dilation and enhance algorithmic suggestions. “DOES HE NOT UNDERSTAND HOW INTERNET ACCESS WORKS?!” one other stated after Richard Hudson, Republican of North Carolina, requested if TikTok might “entry the house Wi-Fi community.”

Deutsche Financial institution leads a pointy fall in European financial institution shares. The inventory fell as a lot as 13 % on Friday morning after the price of insuring the financial institution’s debt rose sharply this week. The Stoxx 600 index of European banks was additionally down sharply regardless of efforts by policymakers to reassure traders.

Ukraine will want $411 billion to rebuild, the World Financial institution estimates. That new determine is considerably increased than the $349 billion the establishment forecast in September. In the meantime, President Volodymyr Zelensky of Ukraine urged E.U. leaders to impose extra sanctions on Russia and velocity up his nation’s software to hitch the bloc.

Chinese language authorities arrest staff at an American due diligence agency’s Beijing workplace. The New York-based Mintz Group stated its workplace was raided and all of its Chinese language workers members have been detained this week. The arrests have been made simply days forward of a gathering of Chinese language officers and world executives, together with Tim Cook dinner of Apple and the Bridgewater founder Ray Dalio, that’s supposed to rebuild worldwide investor confidence within the nation.

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The Financial institution of England raises charges once more to fight inflation. Britain’s central financial institution elevated charges by 1 / 4 level, to 4.25 %, following comparable strikes by the European Central Financial institution and the Fed. The Financial institution of England stated that the nation’s banks have been resilient, and indicated it was extra nervous about persistently rising shopper costs.

Financial institution shares took a roller-coaster trip this week, as traders tried to maintain up with Treasury Secretary Janet Yellen’s steerage on what the federal government would do to shore up the sector. On Wednesday, shares tumbled after Ms. Yellen performed down the prospect of a common assure on financial institution deposits. She moved to wash up these feedback yesterday, although it’s unsure that markets really feel Washington’s method to propping up lenders is any clearer.

Buyers pointed to 11 phrases from Yellen’s ready remarks for a Home listening to. “Actually, we’d be ready to take further actions if warranted,” she stated in that testimony, on high of current authorities instruments to stabilize wobbly lenders.

These feedback stand in distinction to what she stated the day before today. She instructed senators that the Biden administration wasn’t contemplating briefly increasing authorities insurance coverage to all U.S. financial institution deposits with out Congressional approval. (Buyers had taken coronary heart from experiences that the Treasury Division was finding out simply that.)

And the feedback on Wednesday gave the impression to be a change from what Ms. Yellen stated Tuesday at a gathering held by the American Bankers Affiliation: “Related actions might be warranted if smaller establishments endure deposit runs that pose the chance of contagion,” she instructed the gathering.

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The lesson stays the identical. Buyers wish to know what the federal government will do if weakened lenders are battered once more. That uncertainty was mirrored in how financial institution shares traded yesterday: First Republic, which continues to be looking for a lifeline, fell 6 %, whereas PacWest dropped 8.5 %. The broader KBW financial institution index closed down 1.7 %.


Shares in Block, Jack Dorsey’s monetary expertise firm, plunged practically 15 % on Thursday after it was attacked by a formidable opponent: Hindenburg Analysis, the brief vendor that has already taken on the likes of the Indian conglomerate Adani Group and Nikola, the electric-truck maker.

In a prolonged report printed yesterday, Hindenburg accused Block of facilitating fraud by means of its Money App, a cell funds service, and inflating the service’s consumer numbers — and stated it was betting that the corporate’s shares would fall.

The report strikes at Block’s most outstanding service. The corporate, initially often called Sq., rose to fame by way of its ubiquitous bank card readers and later purchased the Afterpay buy-now-pay-later service and the Tidal streaming music platform. However Block needs to show Money App right into a monetary superplatform. “Every thing that you just want in your monetary life, you could find inside Money App,” Mr. Dorsey stated in November.

As of yr finish, Block stated Money App had 51 million lively customers, and it generated $2.9 billion in gross revenue for 2022.

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What Hindenburg says: Money App is rife with faux accounts that artificially inflate its consumer numbers and is getting used for a variety of crimes, from drug dealing to intercourse trafficking. (Maybe in a bid to seize consideration, Hindenburg cited a number of rap lyrics referencing Money App’s use in drug gross sales and tried murders.)

Block is preventing again. The corporate stated it plans to “work with the S.E.C.” and “discover authorized motion” in opposition to Hindenburg over what it referred to as an inaccurate and deceptive report. “We have now reviewed the complete report within the context of our personal information and consider it’s designed to deceive and confuse traders,” Block added.

What’s subsequent for Hindenburg? The agency’s founder, Nathan Anderson, instructed DealBook in October that Hindenburg was near publishing investigations into 4 publicly traded corporations. He gave few hints in regards to the targets, however stated he was targeted on companies susceptible to rising rates of interest. “When you might have a rising charge surroundings and extremely levered corporations, oftentimes you see extra intense efforts at accounting manipulation to try to paper over these issues,” he stated. “These may be actually fascinating areas for fraud analysis.”


Tidjane Thiam, the C.E.O. of Credit score Suisse from 2015 to 2020, on how final weekend’s shotgun merger of UBS and his former employer can have a long-lasting impression on traders and the European banking sector.


There’s been a significant breakthrough in one of many crypto world’s longest-running prison issues: Do Kwon, the manager wished within the U.S. and South Korea (and below investigation in Singapore) for the $40 billion collapse of his stablecoin firm final yr, was arrested yesterday in Montenegro.

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Kwon had been on the lam for practically a yr following the market crash of his agency’s twin digital currencies, the TerraUSD stablecoin and Luna. That implosion spooked the crypto market, setting off a brutal stoop in digital asset values that worn out traders and triggered a string of bankruptcies.

Hours after officers in Montenegro introduced Mr. Kwon’s arrest, federal prosecutors within the Southern District of New York stated they have been charging the 31-year-old founding father of Terraform Labs with eight counts of fraud and market manipulation. The S.E.C. has additionally charged him with masterminding “a multibillion-dollar crypto asset securities fraud.”

Police apprehended Mr. Kwon as he tried to move by means of airport safety with “counterfeit documentation,” Filip Adzic, Montenegro’s inside minister, said on Twitter.

The query is the place Kwon will go subsequent. In a congratulatory response to Mr. Adzic, Korea’s nationwide police company tweeted: “We sit up for your help” in extraditing Kwon to Korea.

Offers

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  • Tom Brady is taking a stake within the WNBA’s Las Vegas Aces. (Axios)

  • Adidas and Beyoncé reportedly agreed to finish the partnership behind the singer’s Ivy Park activewear line. (The Hollywood Reporter)

  • A chatbot start-up based by ex-Google staff was valued at $1 billion in a brand new funding spherical. (NYT)

  • MSCI is about to strip lots of of mutual funds of scores tied to environmental, social and company governance points, whereas 1000’s extra shall be downgraded. (FT)

Coverage

Better of the remainder

  • “Tradition conflict: the problem of uniting fierce rivals UBS and Credit score Suisse” (FT)

  • “The Youthful Brother Caught within the Center of the FTX Investigation” (NYT)

  • The brand new C.E.O. of Starbucks says he’ll work a shift a month within the firm’s shops. (CNBC)

We’d like your suggestions! Please e-mail ideas and solutions to dealbook@nytimes.com.

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Column: Disneyland just promised electric cars at Autopia. Gas will be gone by 2026

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Column: Disneyland just promised electric cars at Autopia. Gas will be gone by 2026

When the Walt Disney Co. announced earlier this month that it would at long last ditch the smog-spewing gasoline engines at its beloved Autopia attraction in Anaheim, the company left a few key details to the imagination.

Would the new ride vehicles be purely electric? Or would they be hybrids that still burned some climate-wrecking, oil-based fuel? And how long would it take for Walt Disney’s creative and engineering heirs to make the long-overdue switch?

After I wrote a story breaking the news about the company’s plans, a coalition of electric vehicle activists launched a campaign to pressure Disney to commit to electric vehicles — not hybrids — and to phase out gasoline within two years.

On Thursday, those activists won.

In a written statement, Disneyland spokesperson Jessica Good confirmed to The Times that electrification “means fully electric — it does not mean hybrid or any other version of a gasoline combustion engine.” She added that the theme park “will no longer be using the current engines within the next 30 months.”

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That means by fall 2026, Disneyland guests will no longer have to worry about breathing lung-damaging exhaust as they wait in line for Autopia — and park employees won’t have spend hours-long shifts inhaling those fumes as they work the ride.

It’s not yet clear when the newly electrified Autopia will reopen.

“Reimagining an attraction does take time, so we don’t have a reopening date at this time,” Good said.

Zan Dubin, the electric vehicle advocate leading the pressure campaign, was thrilled when she heard Thursday’s news. She called it a “huge victory” and a powerful reminder that climate activism works.

“All it takes for bad stuff to keep happening is for good people to do nothing,” she said, paraphrasing Abraham Lincoln. “And we refuse to stand by and do nothing.”

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Dubin had been planning to lead a rally outside Walt Disney Studios in Burbank on Sunday, to urge the company to do better on Autopia. She’s told me she’s moving forward with the event, although she said it will now be more of a celebration.

“We are thrilled,” she said.

The stories that Disney tells at its theme parks — and on its streaming services, cruise ships and other platforms — are far more than entertainment. They play a powerful role in shaping how we understand our world and ourselves. That’s why the company’s decision to close Disneyland’s Splash Mountain ride — which was based on a racist film — and its increasing embrace of LGBTQ+ characters in its films have become such political flash points. The opponents of progress know that these choices matter.

If you care about climate progress, you should care about Autopia.

Disneyland visitors wait to exit the Autopia attraction in March.

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(Allen J. Schaben / Los Angeles Times)

When the ride opened in 1955 as a centerpiece of Walt Disney’s Tomorrowland, it helped cement in the American consciousness the idea that gas-guzzling cars — and sprawling freeways — were the promise of the future. Within a year, President Eisenhower had signed the bill that would create the Interstate Highway System as we know it today.

Nearly 70 years later, cars, trucks and other modes of transportation are the nation’s largest source of heat-trapping emissions — emissions that have fueled record global temperatures for 10 straight months, resulting in deadlier heat waves, fires and storms. Fossil fuel combustion also produces regular old air pollution that researchers say kills millions of people each year.

Switching from gasoline engines to electric cars alone won’t solve all of our environmental and public health problems.

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Mining to supply lithium for lithium-ion electric car batteries can be environmentally destructive in some places. Freeways have historically been built through low-income communities of color, tearing apart vibrant neighborhoods. The more we can rebuild our cities around public transit, electric bikes and green space — and less around cars — the happier and healthier we’ll be.

Beyond Autopia, Disney has an opportunity to promote that kind of future in Tomorrowland.

As I wrote earlier this month, Disneyland fans agree that the once-futuristic land hasn’t been especially forward-thinking for a long time. To my mind, clean energy and sustainability would make the perfect theme for a new and improved Tomorrowland. There’s already a major public transit element in the Monorail. Throw in some gas-free induction stoves at the main restaurant, some solar panels, some environmental films at the currently empty movie theater — it could be pretty awesome.

But even short of all that, we’re going to need a lot of electric vehicles, fast, to get the climate crisis under control. And for Disney to start telling the story of those EVs at Autopia is a big deal. The company deserves credit for getting it right.

“I’m glad they’re stepping up and doing the right hitting,” said Joel Levin, executive director of Plug In America, a national electric vehicle advocacy group that’s sponsoring this Sunday’s rally. “It’s a great way for the public to experience electrification, to turn it into a teachable moment, rather than the experience of standing next to a gas lawnmower, which is what it feels like now.”

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Column: The salmon industry faces extinction — not because of drought, but government policies and politics

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Column: The salmon industry faces extinction — not because of drought, but government policies and politics

Snapshots from an environmental and economic disaster:

Kenneth Brown, the owner of Bodega Tackle in Petaluma, reckons he has lost almost $450,000 in the last year.

“I haven’t taken a paycheck in seven or eight months,” he says. He has had to lay off all but one employee, leaving himself, his son and the one remaining worker to run the business.

James Stone, board president of the Nor-Cal Guides & Sportsmen’s Assn., says more than 120 guides who serve recreational fishing customers in and around the Sacramento River and San Francisco Bay have been all but put out of business, costing the economy as much as $3.5 million a year.

Salmon have survived droughts in California for millennia. But when on top of that you have incredible water diversions and temperature pollution, you’re killing these baby fish. And when you kill the baby fish, they don’t come back as adults.

— Scott Artis, Golden State Salmon Assn.

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Sarah Bates, the owner of a commercial fishing boat in San Francisco, has seen 90% of her income washed away. She has watched a commercial fleet capacity of nearly 500 boats reduced nearly to zero.

The circumstance affecting all three is the shutdown of the crucial fall-run salmon fishing in California, which the Pacific Fishery Management Council, a governmental body, recently extended for 2024, the second year in a row.

The main reason is the decline of the salmon population in the Sacramento River to such an unsustainable level that there’s reason to fear that it may not recover for years, if ever — unless government policies are radically reconsidered.

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Commercial fishers who relied on the fall-run salmon as their dominant source of income have struggled to find alternatives.

“Some people are bringing in black cod or rockfish or albacore,” Bates told me. Some land Dungeness crab. But prices for those products don’t match the value of Chinook salmon.

“That allows for some income, but doesn’t really make up the difference for what you lose,” Bates says. “There are members of the fleet who have taken land jobs, or are relying on household members to pay the bills.”

One can’t minimize the scale of the shutdown, which follows a long-term decline in the fishery and is the first such shutdown since 2008-2009, which was driven by a severe drought. In 2022, the last year of salmon fishing in California, the fleet consisted of 464 commercial vessels, down from 4,750 in 1980.

Private and chartered recreational trips in California, which reached 98,900 in 2022—down from 148,000 in 2012—have also been shut down.

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The closing of both categories has rippled across the entire fishing economy, affecting hotels and restaurants that catered to recreational fishing customers as well as bait and tackle shops. For Brown’s Petaluma shop, there are no sales of bait or commercial gear — “no more boots, no more rain slickers, all that business is gone and there’s nothing to replace it.”

There’s more to the salmon crisis than the devastation of livelihoods of tens of thousands of Californians working in an industry valued at more than $1.4 billion annually.

The crisis underscores the utter failure of the state’s political leaders to balance the needs of stakeholders in its water supply. In this case, the conflict is between large-scale farms on one side and environmental and fishery interests on the other.

For decades, agribusiness has had the upper hand in this conflict. It’s not hard to discern why: The growers have more money and therefore more political influence. Westlands Water District, the vast irrigation district sprawled over Fresno and Kings counties in the Central Valley—the largest such district in the nation—spent more than $4.7 million on Sacramento lobbying over the last decade.

During the same period, Stewart Resnick, whose Roll International conglomerate owns the Central Valley almond orchards that are the largest growers of those nuts in the world and enormous consumers of water, donated $2.8 million to political campaigns in California, chiefly to Democratic candidates and in support of ballot box initiatives; among his contributions was $125,000 to oppose the 2021 recall of Gov. Gavin Newsom.

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Officially valued at $1.4 billion a year, the salmon fishery can’t hope to compete with agriculture on a dollar-for-dollar basis. The market value of all agricultural products in California was $59 billion in 2022, according to state figures; salmon weren’t counted. The 10 most lucrative farm crops, led by dairy products, brought in some $35 billion that year.

The salmon fisheries are bellwethers for ecological health generally. “Fishermen are directly dependent on a healthy ecosystem,” says Barry Nelson, an advisor to the Golden State Salmon Assn. Their fortunes reflect not merely adequacy of water flows in California rivers and bays, but water quality. Any factor that falls outside a given range can produce a crash in fish populations, endangering whole species while putting men and women out of work.

As my colleague Ian James has reported, a key factor in the survival of the salmon population is water temperature. The diversion of ever more water from the federal government’s Shasta Dam for farm irrigation has driven temperatures in the Sacramento River to murderous levels.

That river, Nelson points out, is “the most important salmon-producing system south of the Columbia River.” But California authorities haven’t required the federal Bureau of Reclamation, which owns and manages the dam, to meet temperature standards downstream of the dam, even though it has the power to do so. “The state just hasn’t done its job,” Nelson says.

Talk to stakeholders in the salmon fishery, and one term keeps cropping up: “water management.” Their point is that drought isn’t the most important factor in the survival of the species — policy is, specifically the management of water supplies so that they’re balanced among users and serving irrigation demand from farmers doesn’t wipe out competing interests, especially during dry years.

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To better understand the threats to salmon, it helps to know about their life cycle. Salmon live and breed on a three-year timeline. Adult fish swim in the ocean, but migrate upstream to lay eggs in the gravel beds of inland rivers. After they hatch, the baby fry and juveniles, called smolt, begin migrating downstream, typically via San Francisco Bay, and out to sea. Then the cycle begins again.

The critical period for the fall-run salmon in the Sacramento is while the eggs are incubating in their gravel beds. At water temperatures of 54 degrees, they start being cooked to death. Irrigation releases from Shasta suck down the reservoir’s cold water, leaving surface water heated by the sun; that’s what ends up in the Sacramento River at spawning season.

In recent years, water in the spawning beds has been measured at 70 degrees or higher. In 2021, state biologists reported, 99% of winter-run Chinook salmon failed to reach the San Francisco-San Joaquin River delta and the bay.

“Salmon have survived droughts in California for millennia,” says Scott Artis, executive director of the Golden State Salmon Assn. “But when on top of that you have incredible water diversions and temperature pollution, that’s what’s killing these baby fish. And when you kill the baby fish, they don’t come back as adults.”

The need for painstaking water management is the result of human interventions in California’s natural environment. Over the last 100 years, rivers across the Central Valley were dammed to provide irrigation for farms, blocking salmon from their natural habitats. The federal government opened salmon hatcheries to compensate, but they have not produced enough fish to make up for the losses from poor water management.

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Meanwhile, the water demands of California growers became less flexible. Crops that could be fallowed during dry spells, leaving more water for the environment, were supplanted by almond and pistachio orchards, which require water in wet years and dry. California almond acreage rose to 1.38 million last year from 418,000 in 1995. In the same period, pistachio acreage rose to more than 461,000 from 60,300.

The crisis that has unfolded in 2023 and this year has its roots in actions taken during the Trump administration. In 2019, Trump installed David Bernhardt, a lobbyist for agricultural water users, as Interior secretary.

As an attorney in private practice, Bernhardt had sued the government on behalf of the giant Westlands Water District to challenge its enforcement of the Endangered Species Act, which conflicted with Westlands’ interests. As Interior secretary, Bernhardt advocated for loosening enforcement of the act.

In 2020, Bernhardt and Trump implemented an increase in water deliveries to big farmers under conditions that spelled disaster for the salmon fishery, among other ecological issues. California objected, asserting that Interior’s official biological opinions, which concluded that the increases wouldn’t adversely affect salmon and other species, bore no “rational connection [with] the facts.” The Natural Resources Defense Council labeled the opinions “a plan for extinction” of salmon and other endangered species.

They went through anyway. The demands from agribusinesses in the Central Valley for more water had received a friendly hearing from the Trump administration and Republicans in Congress, who recognized that the valley was perhaps the only strongly Republican part of California. They decried the passage of water from inland reservoirs to rivers and out to sea as wasteful; as I wrote at the time, their single-minded service for the growers deprived the salmon fishery of its lifeblood.

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The impact of the Trump policies was destined to be felt three years on. Indeed, last year only 6,160 adult salmon were estimated to have spawned in the Sacramento River, the worst level since the drought year of 2017 and obviously well below the annual average of 175,000 spawning from 1996 to 2005, the best period for the health of the salmon fishery over the last four decades.

In January, Newsom responded to the salmon crisis with an action plan encompassing restoring salmon habitats, modernizing hatcheries, and removing impediments to salmons’ upstream migrations. The fishery community supports many of those initiatives, but also recognizes that the package is largely aspirational, for money hasn’t been appropriated to fulfill all its elements.

The Newsom administration also outlined plans in March 2022 to reach a series of voluntary agreements with agricultural water users over water sharing. Environmental and fishing groups, which weren’t part of the negotiations, weren’t impressed — a coalition of those groups, including the Sierra Club and the Golden State Salmon Assn., panned the proposal as “incomplete, unenforceable, inequitable, inadequate, and [lacking] a scientific foundation.”

Nor were the proposed voluntary agreements favored by two key federal agencies. The Environmental Protection Agency wrote in January that the absence of strong mandates for higher water flows in the Sacramento River meant that the plan would have only a “insignificant impact” on water temperature in the river. The National Marine Fisheries Service questioned whether the $740 million in state and federal funding needed to implement the voluntary agreements was realistic, since none of it had been appropriated.

In other words, Newsom’s approach involves a heaping helping of hand-waving. From the standpoint of the salmon industry, his other water policies, including a 45-mile water tunnel under the delta and fast-tracking construction of the Sites Reservoir in the western Sacramento Valley, will make things worse. The tunnel would turn the delta into “a deathtrap for salmon,” Nelson says, and the Sites Reservoir would degrade downstream waters, possibly increasing temperatures.

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In many respects, the policies on the table are antiques. Some were developed without regard for the effects of global warming, and others reflect thinking that emerged in an era when California authorities thought the water supply was abundant, even unlimited.

That won’t do anymore. The federal government already lists Sacramento River winter-run Chinook salmon as an endangered species and the spring run as a threatened species. The all-important fall run might not be far behind.

California’s water policies need to be subjected to a thorough rethinking, and money to fix all that’s broken needs to be appropriated, not just put on somebody’s wish list.

Fishermen and -women are a constitutionally optimistic class. “There’s always hope that things will get better,” Artis told me. But hope is waning. “We have to educate the Legislature and the public so we get those water flow and temperature protections, or we’ll be here again year after year with fishery closures.”

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Avian flu outbreak raises a disturbing question: Is our food system built on poop?

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Avian flu outbreak raises a disturbing question: Is our food system built on poop?

If it’s true that you are what you eat, then most beef-eating Americans consist of a smattering of poultry feathers, urine, feces, wood chips and chicken saliva, among other food items.

As epidemiologists scramble to figure out how dairy cows throughout the Midwest became infected with a strain of highly pathogenic avian flu — a disease that has decimated hundreds of millions of wild and farmed birds, as well as tens of thousands of mammals across the planet — they’re looking at a standard “recycling” practice employed by thousands of farmers across the country: The feeding of animal waste and parts to livestock raised for human consumption.

“It seems ghoulish, but it is a perfectly legal and common practice for chicken litter — the material that accumulates on the floor of chicken growing facilities — to be fed to cattle,” said Michael Hansen, a senior scientist with Consumers Union.

It is still unclear how the cows were infected — whether by contact with birds, or via feed made from litter waste — but litter has been associated with previous outbreaks of disease, including botulism.

Poultry litter causing the bovine cases of avian flu is considered “very unlikely, though not impossible” wrote Veronika Pfaeffle, in a joint statement from the U.S. Department of Agriculture and the Food and Drug Administration.

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Poultry litter consists of manure, feathers, spilled feed and bedding material that accumulate on the floors of the buildings that house chickens and turkeys. It can contain disease-causing bacteria, viruses (including H5N1), antibiotics, toxic heavy metals, pesticides and even foreign objects such as dead rodents, birds, rocks, nails and glass.

It is typically mixed with hay or corn to make it palatable to livestock.

California bans the feeding of poultry litter to lactating dairy cows. However, it is legal to sell it as feed to beef and other cattle.

“It is a premium product used to help recycle waste into a sustainable product,” said Anja Raudabaugh, CEO of Western United Dairies. She said that although she could not make informed comments about its use outside of the state, “there is very little of it used here in California.”

California’s animal feed law — which applies to commercially sold feeds — requires that animal waste products sold for feed must contain no residues of pathogens, metals, pesticides or antibiotics.

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The Department of Food and Agriculture’s Feed Program “inspects every California facility manufacturing dried poultry litter and reviews firms’ treatment verification records onsite,” said Steve Lyle, department spokesman.

However, it is unclear whether there are regulations addressing the private exchange or production of poultry litter or other animal waste for feed. Or how widespread the practice of feeding poultry waste to cattle is in the state or around the country.

It “was a common practice throughout the U.S. for many years,” said Lyle. “It is not a very common practice in California anymore.”

Chicken litter cannot be fed to lactating dairy cows under California law.

(Luis Sinco / Los Angeles Times)

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According to Michael Payne, a researcher and outreach coordinator at the Western Institute of Food Safety and Security at UC Davis, there was at least one commercial processor of poultry litter in the state — Imperial Western Products, based in Coachella. That company was bought in 2022 by Arkansas’ Denali Water Solutions — which has had recent legal run-ins with environmental authorities in Missouri and Alabama over its handling of animal waste. It is unclear whether Imperial still produces feed from litter. An operator at the company directed calls to “corporate,” or Denali Water Solutions, which is owned by TPG Growth, a private equity firm. Denali did not provide comments for this story before publication.

The federal government does not regulate poultry litter in animal feed, and in many states — including Missouri, Alabama and Arkansas — there are no requirements or regulations regarding contamination or processing.

“The FDA may take regulatory action if it becomes aware of food safety concerns with poultry litter products intended for use in animal food in interstate commerce,” Pfaeffle said in the statement from both the USDA and FDA.

An online guide from the University of Missouri notes there are “no federal or Missouri regulations governing the use of poultry litter as a feed.” However, the guide’s authors urge users to employ “common sense.”

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“Poultry litter should not be fed to dairy cattle or beef cattle less than 21 days before slaughter,” the guide notes, citing concerns about “residues of certain pharmaceuticals.”

Most other developed nations — including Canada, the United Kingdom and the countries within the European Union — have banned the practice. The FDA considered doing so in the U.S. in the mid-2000s.

For cattle farmers, the waste — which includes calcium, zinc and other minerals and vitamins — provides a cheap form of protein feed. For poultry farmers, the exchange allows them to divert the litter away from a landfill or from being burned.

In the 1980s, concerns about bovine spongiform encephalopathy — or mad cow disease — took hold across Europe, when cases of the incurable and invariably fatal neurodegenerative disease of cattle began to appear. The disease, which is caused by folded proteins known as prions, can transfer to people who eat the meat of infected cattle. In people, the disease is fatal and called Creutzfeldt-Jakob disease.

Just as cattle are fed poultry waste, chickens are often provided feeds that consist of cattle waste and renderings — creating a potential route for prions to re-enter the food supply. However, because the FDA mandates the removal of all tissues shown to carry the prions — such as brains and spinal cords — from poultry diets, the risk is reduced.

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However, other more common pathogens are also found in poultry litter. In one 2019 study of litter used on farm fields as fertilizer, researchers found that every sample tested from U.S. broiler chickens carried E. coli strains resistant to more than seven antibiotics — including amoxicillin, ceftiofur, tetracycline, and sulfonamide.

It is unclear if the litter was heat treated before it was applied.

Raudabaugh said all poultry litter feed in California is kiln heated and exposed to temperatures that can kill bacteria, such as E. coli, and viruses, including H5N1.

“Firms are sampling and analyzing finished product for Salmonella regularly,” said Lyle, the state’s food and agriculture spokesman.

He noted that poultry is regularly tested for bird flu and that poultry waste from a flock infected with bird flu “cannot leave the premises until it has met CDFA requirements for ensuring the virus has been eliminated,” he said. “The premises is also tested and the quarantine is not released until the premises tests negative for highly pathogenic avian influenza.”

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Lyle said cattle herds with “symptoms consistent” with bird flu infections “can be tested at the California Animal Health and Food Safety Laboratory in consultation with the CDFA Animal Health Branch.”

He added that no symptomatic herds have been identified, “although one herd that lost pregnancies was tested and was negative” for the virus.

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