Search

By David Levine

The general public’s strong opposition to the oft-called "Muslim travel ban" was not surprising -- but the business community’s reaction was. Companies are typically silent on a presidential executive order that doesn’t directly address business. Not this time.

Amazon went on record early, supporting the judicial roll-back of the executive order. In a widely reported effort, nearly 100 famous-name, mostly-tech companies, including Apple and Microsoft, jointly filed an amicus brief against the travel ban.

Levi-Strauss and Tesla were also involved in the filing. Y Combinator is supporting the ACLU, whose lawyers successfully challenged the ban at its outset. Amazon joined with Expedia in supporting Washington state’s lawsuit against the ban -- the case in which the federal judge granted a temporary stay, returning travel to normal. Disney and other mega-firms also expressed concern.

The amicus brief statement – echoed by Amazon in the Washington state case -- explained that the travel ban “disrupts ongoing business operations” and further that it “threatens companies’ ability to attract talent, business and investments to the United States.”

Boosting the voice of responsible business

The American Sustainable Business Council launched a sign-on letter to help build a broad, collective business voice protesting the travel ban. It stated, in part, “Many businesses will suffer financially, as fearful employees will be less productive and lower consumer confidence will decrease sales. Many talented, loyal employees throughout the economy should be hard at work contributing to our success -- instead, they are now in a legal quagmire.”

Within two weeks, more than 350 business leaders signed the letter, including Seventh Generation, Dansko and Earth Friendly Products.

Being a force for good means speaking out

Many of these companies are fervent competitors, but they share an awareness that business leaders not only can be, but must be, a force for good on behalf of their fellow human beings – and that this sometimes means standing up and speaking out.

The interconnectedness of buyers and sellers, workers and employers is not new, but respect for it is overdue. Companies like the ones in action here are the cutting edge of a smarter, broader definition of what it means to be “businesslike.” This new definition of businesslike is transforming every industry. It also  has the potential to transform government policy.

With businesspeople dominating the new Administration, we should expect policies designed to be business-friendly. But with conventional business lobbies entrenched in Washington and state houses across the country, the prevailing definition of “business-friendly” government will fall into two unhelpful categories: short-term, profit-at-all-costs, crony capitalism, or disruptive policies – like the immigration ban -- that distract from voters’ other concerns.

'Business-friendly' government looks very different to companies that are economically, socially and environmentally responsible. These companies operate from ethical principles and live their values through their everyday business practices. Menacing the wellbeing of valued employees and customers disrupts their operations, and policies that do that are never “businesslike.”

Conventional business voices have always had enormous influence on policy decisions. The U.S. Chamber of Commerce is the largest lobbing group in Washington for a reason. Despite defections of well-known brand companies because of the Chamber’s positions on certain policies, the Chamber still spends more than two-and-one-half times more on lobbying than the next biggest lobbing group.

When business leaders speak, policymakers listen. But for too long, responsible business leaders have focused on their work and let others, like the U.S. Chamber, talk for them. Now it appears responsible businesses want to send a different message.

That’s good news for our economy, our environment and our democracy. Responsible business leaders understand we don’t need to damage our environment to have a strong economy. They realize fair regulations are the only way to ensure markets work for the long-term, not just the next quarter. And they know trampling human rights will not bring better jobs.

Responsible company leaders are signing on and speaking up to bring a smarter business voice to the table. In condemning the travel ban specifically, they’ve reminded government that the ban undermines the interconnections and workforce mobility on which all businesses depend. They’ve also reminded government that, since immigrants have consistently added value to our economy, banning them not only violates America’s basic beliefs but threatens America's competitiveness and prosperity.

The more that ethical business leaders speak out to explain how responsible public policy is good for business, the more impact we’ll have on policymakers. We have the advantage of surprise: business defending the good is news. If we use this advantage and provide a better voice for “what business wants,” we’ll give government cover to enact policy that brings out the best in American business, and in people, too.

Business leaders may sign the ASBC letter here.

Image credit: Flickr/Peg Hunter

David Levine is co-founder and CEO of the American Sustainable Business Council.

Think the Wall Street bailout was painful? Soon that may seem like the good old days as America pays for the boomer generation's retirement and poor health.

The baby boomer generation is so large that it has shaped the American economy since their births between between 1946 and 1964. Their current size approximates the combined populations of California, Texas and Florida. Now image the populations of all three states having no money and poor health. That is the crisis about to hit the boomer generation and America.

The boomer generation’s financial crisis

The vast majority of the boomer generation has failed to adequately save for retirement. The average baby boomer has saved $136,000. But averages can be highly deceiving. In fact, 25 percent of the boomer generation has zero money saved for retirement. And less than half have saved $50,000 or more.

That equates to 37 million Americans having zero or little savings. Texas has 30 million citizens. So the coming boomer generation crisis will be similar to everyone living in Texas declaring bankruptcy because they have no savings, their medical costs are soaring and their health issues preclude them from working.

The boomer generation cannot afford its weight

The boomer generation is in a weight crisis. Seventy-five percent of boomer generation women and 80 percent of boomer generation men are either overweight or obese. Their historical diet and lifestyle choices are now endangering their health and is driving government healthcare expenditures to record levels.

Medicare is the federal health insurance program for citizens 65 years of age or older. Fifteen percent of the U.S. budget is spent on Medicare because the premiums paid by those on Medicare do not cover the full cost of its health services.

Two huge funding issues confront Medicare. One is that the Affordable Care Act, also known as Obamacare, actually reduced Medicare costs. If Republicans repeal Obamacare, then Medicare costs go up. The options if this happens are to:

• Ask the generation that has not saved for its health care to pay more


• Provide less medical coverage leading to sooner and more painful end of life


• Increase government payments to Medicare.

A massive increase in Medicare spending is the second issue. Medicare expenditures are projected to reach more than $1 trillion annually in 10 years. That is almost double current expenditure levels.

The bottom line for all politicians -- and our country -- is that the boomer generation cannot afford its health care without massive government support. The alternative is to subject the boomer generation to painfully shortened lifespans.

Four actions that address the boomer generation crisis

There are sustainable solutions if, as a nation, we can overcome healthcare industry lobbying and ideological posturing over individual rights. They are:

1. A Manhattan Project type effort to cut medical costs: The Manhattan Project brought together America’s greatest engineers and physicists to design a nuclear bomb. We need a similar effort to achieve affordable health care.

This effort would push aside health industry lobbying and engage America's business and technology best and brightest. They would be charged with designing business systems and implementing technology solutions that pushed down costs while enhancing the quality of healthcare. Like Amazon is doing to Sears, this will probably wipe out much of today’s inefficient health care business practices and companies. The result will be affordable, quality health care.

2. Tax unhealthy foods like we do cigarettes: We can no longer afford the health consequences of what we eat! For example, sugary drinks, and the sugar that permeates most of our manufactured food, is destroying our health. Our food system needs to be redesigned to deliver health.

This, of course, smacks into the individual right to eat and drink whatever we want. The proven economic solution is to charge more for behavior that inflicts self harm or high societal costs. For example, higher cigarette taxes have cut smoking rates with measurable reductions in cancer incidents. Similar public policy applied to unhealthy foods will mitigate our nation’s healthcare costs and reduce human suffering.

3. End workplace age discrimination: Most members of the boomer generation can cite specific examples of workplace age discrimination. This is a barrier to extending their working lives. Enforcing age discrimination laws will increase the amount of money the boomer generation can spend on Medicare payments.

4. Technology training for boomer generation workers: This generation’s employment can be extended with government-funded job training on work place technology. Doing so is a lower cost alternative to providing them with government substance funding.

Affording the boomer generation

America has never been here before. We cannot afford our largest demographic group.

The alternatives are crystal clear. We can keep the failed systems we now have in place and tax/borrow funds to financially bailout the boomer generation. Or we can develop solutions that deliver:

1. affordable/quality health care


2. improved individual health through a national adoption of a healthy food system


3. an extended boomer generation work horizon through enforcement of age discrimination laws while also funding work place technology training.

Image credit: Pixabay

The U.S. has the highest incarceration rate in the world. Although African Americans are only 13 percent of the U.S. population, they make up 40 percent of America's prisoners. African American men are incarcerated at over five times the rate of white men.

Google believes it can help be part of the solution. The company plans to invest $11.5 million in grants to American organizations working to reform the criminal justice system. “Mass incarceration is a huge issue in the United States, and a major area of focus for our grants,” Justin Steele, principal of Google.org, Google's charitable arm, wrote in a blog post.

Google.org will give $5 million to the Center for Policing Equity’s (CPE) National Justice Database (NJD), the first database in the nation to track and standardize police stops, use of force and other police interaction data from law enforcement agencies. The grant will be spread over three years and will allow CPE to incorporate resident surveys that directly link police behavior to the community perceptions of police, expand the NJD to more cities, and reduce reporting times back to police departments once data analysis is complete. Google will help CPE automate the process it uses to extract data from participating police departments.

The NJD began in 2012. Police departments responsible for over half of the country’s major cities and representing over a third of the U.S. by population have made commitments to participate.

“Google’s deep investment will help us think bigger and bolder about how to make policing more democratic and more American,” CPE president and co-founder, Dr. Phillip Atiba Goff, said in a statement.

“It’s nothing short of a financial miracle in terms of what it allows us to do evidence to reduce racial disparities in the criminal justice system,” added Justin Steele of Google.org. 

Google is also supporting two California-based organizations that focus on ways data can help bring more equity in U.S. court systems.

It granted $1.5 million to Measures for Justice, which is working to create a Web platform that allows anyone to see how their local system treats people based on ethnicity, sex, indigent status, age and offense history. Google granted the W. Haywood Burns Institute $500,000 to ensure this data are accessible to criminal justice reform organizations across all of California’s 58 counties .

Google also granted:

• $1 million for Impact Justice’s national Restorative Justice Project, which aims to keep 1,900 youth out of the juvenile justice system.
• $650,000 to support JustLeadershipUSA, which works to train a national network of formerly incarcerated leaders across the U.S. to lead criminal justice reforms.

Google has also made re-investments in organizations that are working to provide services to formerly incarcerated people and their communities, which includes Defy Ventures, Center for Employment Opportunities, Silicon Valley De-Bug and Code for America.

Google has committed over $5 million to organizations advancing racial justice since 2015. Two years ago, the company granted $2.35 million to support leaders, including #BlackLivesMatter co-founder Patrisse Cullors; Chris Chatmon, who leads Oakland's African American Male Achievement Initiative; and Raj Jayadev, who founded the criminal justice reform organization Silicon Valley De-Bug. Last year, Google gave $3 million in grants to four organizations working to help eliminate racial bias in educational systems: San Francisco’s My Brother and Sister’s Keeper program, Oakland’s Roses in Concrete Community School, the tech-enabled college success startup Beyond 12, and the national Equal Justice Initiative.

Google says it has also done work within its own company to create more equity. The company started to have what it terms an “internal conversation” about unconscious bias in 2013 when 65 percent of its employees participated in workshops. The company shared its “unbiasing” materials and research on re:Work with Google to allow other companies to create unbiasing trainings.

Image credit: Google

By Matthew Pietrafetta

Though education entrepreneurs may differ in their opinions of President Donald Trump and the new Secretary of Education, Betsy DeVos, they can agree on one thing: This new administration will mean a significant shift in American education policy.

Because federal education policy impacts school budgets, standards, curriculum and evaluation metrics, a new public policy direction can have a major impact on education organizations and entrepreneurs.

This impact is especially pertinent for those who define their business model narrowly on one set of policies which, if repealed or modified, can force education organizations to completely redefine themselves.

The rise and fall of Common Core?

While the election of President Trump means a potentially favorable rollback of regulations for businesses in other industries, the rollback in education standards may not be so favorable for organizations invested in education. Consider Common Core standards, which President Trump has pledged to eliminate, and DeVos also claimed she does not support.

With $200 million in start-up money from the Gates Foundation and $4.35 billion in Race to the Top federal grants to support its implementation and adoption, the Common Core aspired to serve as a universal framework for standards-based education. While controversial and often misunderstood from the start, Common Core garnered both conservative and liberal support for a more rigorous set of national college and career readiness standards that would lift public education in America.

Swept up in this tremendous gravitational pull of education reform and private and federal funding, many education companies rushed to align to Common Core in their curriculum, assessments, and professional development services to help teachers and school leaders adapt to the new standards. An explosion of entrepreneurship followed as education companies large and small retooled entire curricula and technologies to serve as vendors to states and districts making the Common Core transition.

As support of Common Core declines, not only are these companies at risk of failing, but the students, teachers and school leaders using their products could also lose valuable time and resources. The dilemma highlights two inherent problems in education reform:

1. The deep-seated frustration of educators who strive to build sustainable growth in their schools but are repeatedly undermined by changes outside of their control
2. The risk that education entrepreneurs take on in building educational services that are too narrowly tied to policies in flux

In the end, then, no matter the party in power, education entrepreneurs should strive to build businesses that can withstand policy change.

Preparing for change

So how can education entrepreneurs weather upcoming policy changes and provide services and resources to help schools do the same?

Education entrepreneurs should spend the time to gain a thorough understanding of existing policy and potential policy changes and avoid building their offerings to serve one given policy exclusively. Entrepreneurs should develop products or services of lasting value that can persist even in light of likely policy change and stand the test of time.

Ultimately, the most important thing for any education organization to do is to hone in on the academic value at the core of its offerings. While education policy is volatile, core academic values are largely shared across political groups. Whether the country is currently moving to increase or decrease standardized testing or shift test from one to another, students still need to develop grammar, mathematics, and critical reading skills, so they can interpret complex material and successfully problem solve.

What’s more, teachers speak in a skills-based nomenclature about their students that is not captured perfectly in any national or state standard system. For example, a teaching strategy or education organization that can measurably help a student recognize and correct sentence fragments, run-ons, and misplaced modifiers will last. Why? Not because of its standards alignment, but because it is good, effective teaching that can be proven to make students more accurate readers, writers, and editors.

If entrepreneurs focus first and foremost on delivering enduring, educational value — value that leads to growth in skills and achievement however measured — they can continue to adapt how that value is delivered to fit the specifics of current policy and help school leaders, teachers, and students navigate these transitions.

Image credit: Pexels

Matthew Pietrafetta, Ph.D. is the founder and CEO of the test preparation company Academic Approach.

Food waste is a massive global problem. About a third of all the food produced globally every year is wasted or lost, amounting to 1.3 billion tons. EU countries waste about 88 million tons of food annually, with associated costs estimated at $151 billion. In Britain, about 10 million tons of food is thrown away each year.

One British supermarket chain is looking to do its part to change that. Last month U.K. grocery chain Waitrose introduced 10 new trucks that run on bio-methane produced from food waste. Biomethane is 35 to 40 percent cheaper than diesel and releases 70 percent fewer carbon dioxide emissions.

Waitrose is the first retailer in Europe to run trucks on fuel made from food waste. And new technology allows the range of the trucks to increase from 300 to 500 miles. 

Although the trucks costs 50 percent more than diesel models, fuel savings of $18,690 to $24,920 in two to three years will offset the added costs.

The trucks will likely have a lifetime of five years, and during that time will generate savings of up to $124,600. Each truck will keep over 100 tons of carbon out of the atmosphere.

“Using biomethane will deliver significant environmental and operational benefits to our business,” Justin Laney, general manager of central transport for the John Lewis Partnership, the parent company of Waitrose, said in a statement.

“It’s much cleaner and quieter than diesel, and we can run five gas trucks for the same emissions as one diesel lorry.”

The John Lewis Partnership partnered with CNG Fuels on the Waitrose trucks. Philip Fjeld, CEO of CNG Fuels, said renewable biomethane “is far cheaper and cleaner than diesel, and, with a range of up to 500 miles, it is a game-changer for road transport operators.”

But new lorries aren't the only way Waitrose aims to reduce food waste. The upscale supermarket chain recently launched a charity food redistribution program that allows its stores to connect with local nonprofits. Stores can put details about available food into an app, and participating charities receive a text alert when the food is ready to be collected. The program will start in 25 stores stores, and if the trial is successful, it will be expanded to all Waitrose stores across Britain within 12 months.

Such efforts are nothing new for the chain: In 2012, Waitrose achieved its goal of sending zero food waste to landfills. Four years prior, it became the first British supermarket to send food waste to anaerobic digestion through a partnership with Cawleys, the first resource management company in the country to offer a commercial food waste recycling service for anaerobic digestion.

Waitrose is also a founding signatory to the Courtauld Commitment, a voluntary agreement that aims to reduce food waste within the British grocery sector. It is funded by Westminster, Scottish, Welsh and Northern Ireland governments and delivered by the organization the Waste and Resources Action Program (WRAP).

Other British supermarket chains have also made reducing food waste a priority. Sainsbury is Britain’s second largest grocer, and its charitable food donation partnerships are on the rise, according to data for 2015/2016. 

The supermarket chain Tesco has not sent food waste to landfill since 2009. It avoids waste by donating excess food to charity in partnership with FoodShare. Through an initiative called Community Food Connection, Tesco lets local charities know how much extra food stores have at the end of the day. It has donated over 6 million meals to over 3,500 charities and organizations. Tesco also turns food waste into animal feed, and repurposes chicken fat and cooking oil into bio-diesel.

Image courtesy of Waitrose (press use only) 

On Friday, U.S. President Donald Trump added a new layer to his self-defined 'pro-business' list of executive orders: a rule that equips every agency with its own cost-cutting oversight watchdogs to whittle down rules that seem overly complex or burdensome for U.S. commerce.

The order calls for “task [forces that] will make recommendations to repeal or simplify existing regulations,” Trump said.

And the starting point for making those decisions is pretty simple, the president argued. “Every regulation should have to pass a simple test: Does it make life better or safer for American workers or consumers?”

Trump, who unveiled the latest order at the Conservative Political Action Conference before signing it in the Oval Office, boldly stated: “Regulations are crushing our economy.”

The signing was attended by prominent American business leaders, including Alex Gorsky of Johnson & Johnson, Andrew Liveris of the Dow Chemical Co., Gregory Hayes of United Technologies and Marillyn Hewson of Lockheed Martin.

The new order come amid revelations of growth in sales for U.S. businesses. Fourth-quarter results for both Johnson & Johnson  and Dow Chemical reaffirmed a “Goldilocks economy,” as Kimberly Amadeo, president of WorldMoneyWatch, refers to the country’s economic uptick last year.

But Trump said the order that adds one more source of expense for agencies is necessary.

“This executive order is one of many ways we’re going to get real results when it comes to removing job-killing regulations and unleashing economic opportunity.”

According to the order, federal agencies have 60 days to come up with a “regulatory reform officer” (RRO) who will “oversee the implementation of regulatory reform initiatives and policies to ensure that agencies effectively carry out regulatory reforms.” The task force will be responsible for reviewing regulations and identifying regulations “for repeal or modification.” One of the tasks of the oversight committee will be to identify regulations that “eliminate jobs or inhibit job creation."

The order doesn’t explain how cost-cutting task forces will work when it comes consumer safety issues. Will reducing regulations implemented by the U.S. Department of Agriculture, for example, make it harder to protect consumers from potential food-borne bacteria? The 2014 Heidelberg salmonella outbreak at Foster Farms took the better part of a year to address due to the breadth of the infection. Equally, how will decreasing regulatory oversight incentivize research into toxic substances to which consumers may indirectly be exposed? And what if those eliminated regulations actually lead to a loss of jobs?

Obviously much is unknowns at this point as to the implications of this latest order. American businesses and the economy will just have to wait to find out.

Image credit: Flickr/Michael Vadon

The struggle is often loud and boisterous while the progress happens in a hush. That was the case last week when ExxonMobil quietly announced it would remove significant tar sands oil assets from the books.

The move was, at least in part, a response to concerns about stranded assets. That’s when assets that have been used to calculate the net worth of a company lose part or all of their value before they can be monetized.

The company previously published a report identifying carbon asset risks, in response to shareholder pressure. But although it acknowledged the risk of climate change, the report was short on specifics. Exxon did not quantify the assets that were susceptible to being stranded, choosing instead to play the uncertainty card. In the report, the company said it “believed that any future capping of carbon-based fuels to the levels of a ‘low carbon scenario’ is highly unlikely due to pressing social needs for energy.”

What it boils down to is this: Scientific reports like this one say that we can only burn so much carbon before crossing the 2-degrees Celsius threshold beyond which we face serious physical consequences from climate change. That means billions of dollars worth of fossil fuels need to remain in the ground.

But ExxonMobil is going with a more traditional definition of stranded assets, which refers to assets that are no longer sellable. So the company's dodgy language is saying, in essence, while it may be true that our planet is doomed if people keep buying oil and gas beyond the 2-degree mark, as long as they keep buying it, ExxonMobil will keep selling it, because that’s what it's in business to do.

While some might defend the company's right to say this, it shows exactly why these decisions should not be left in the hands of corporations, something our current administration seems intent on doing.

In this latest move, ExxonMobil  announced in a press release that it has decided to take 3.5 billion barrels of tar sands oil reserves at its Kearl project in Alberta Canada off books.

The company said that none of those reserves can be considered economical according to the accounting rules of the Securities and Exchange Commission, due to the recent precipitous drop in the price of oil. In essence this means that it would cost more for the company to extract the oil than it would make from selling it.

This was a change in policy for the company, which has long resisted calls to revise its estimates of economically-recoverable reserves. ExxonMobil previously doubled down on its Canadian oil sands investments, becoming a major player in that market.

The decision to remove the assets from its books, however, does not mean the company will cease operations there. Exxon intends to continue operations at Kearl, where it still claims 1.3 billion barrels of reserves.

The recovery of tar sands oil has been called “the most destructive project on the planet.” Here are a few reasons why: The combined operations use twice as much water as the Canadian city of Calgary. The water in the tailing ponds is toxic enough to be fatal to ducks that land in it. The amount of energy required to melt the tar so it can flow through pipes could otherwise heat 3 million homes. Finally, producing a barrel of oil from tar sands, emits three times more greenhouse gas than conventional oil production.

Let’s hope that this announcement is the first step in a process that will result in the company ceasing tar sands operations altogether.

Image credit: Howl Arts Collective: Flickr Creative Commons

Last week Alphabet Inc., the parent company of Google, filed a lawsuit against Uber in the U.S. District Court of the Northern District of California. Waymo LLC, Google’s former self-driving car project that is now an independent company under the Alphabet corporate umbrella, accused Uber of patent infringement, unfair competition and stealing trade secrets.

Court filings submitted to the San Francisco federal court allege that former Google employees left the company to found Otto, which was acquired by Uber last August for $680 million. The result, insist attorneys representing Alphabet, Google and Waymo, was a “calculated theft” that earned Otto employees $500 million and allowed Uber to “revive a stalled (autonomous car) program, all at Waymo’s expense.”

At the heart of the litigation is a tug-of-war over the companies’ LiDAR (light detection and ranging) systems. LiDAR is a laser-based scanning and mapping technology that reflects laser beams off objects in order to generate real-time, three-dimensional images. These systems can be applied to a bevy of settings, including in agriculture to determine what land is in most need of phosphates; in archaeology, to find objects otherwise obscured by ground cover; and by the military for weapons systems and aerial operations.

But it is their role as the “brains” of self-driving cars for which LiDAR is critical in order for these vehicles to navigate safely. Further development of this technology -- which emits laser beams in order to measure the shape and speed of other cars, vehicles and bicyclists -- will fuel what analysts say could eventually become a trillion-dollar industry.

As Bloomberg reported late last week, it took Waymo seven years to design its LiDAR system, while somehow Otto and Uber were able to develop a similar technology within nine months.

Waymo says this is because a former engineer, Anthony Levandowski, downloaded over 14,000 files related to the company’s LiDAR systems and circuit board designs six weeks before he left the company last year. Levandowski then allegedly wiped his company-issued laptop clean and reformatted it in order to erase any forensic evidence that almost 10 gigabytes of company information were pilfered. “Misappropriating this technology is akin to stealing a secret recipe from a beverage company,” the company wrote in a recent blog post.

Levandowski has repeatedly denied that he stole any intellectual property from Google and Waymo. And in a statement to Business Insider, Uber said Google’s accusations are without merit, dismissing them as “a baseless attempt to slow down a competitor.”

Google’s lawsuit against Uber comes while the ridesharing giant suffered plenty of pitfalls, many of them self-inflicted, over the past two months.

In January, #DeleteUber trended all over social media as the company was accused of trying to profit while other transportation companies pushed for a general strike due to the Donald Trump administration’s travel ban. Many of the company’s former customers were also furious over the reported ties between Uber CEO Travis Kalanick and the Trump White House. And that angst continued even after Kalanick quit Trump’s economic advisory panel.

Then last week, Uber dominated much of the news cycle for all the wrong reasons as accusations of sexual harassment rocked the company. Meanwhile, many Uber employees have reportedly been commiserating about the company’s work culture on chatting apps such as Blind as critics of the technology sector say Uber’s foibles are rampant throughout the industry.

The litigation within the nascent autonomous vehicles industry is analogous to the legal fistfights between the smartphone giants Samsung and Apple. As a sector grows and becomes more lucrative, companies will deploy any strategies they can to increase their clout in a market or at least stay relevant.

After all, Google and Uber are hardly alone when it comes to accusing competitors of underhanded dealings and unfair business practices. Last month, for example, Tesla Motors sued a former manager for allegedly poaching some of its employees while launching his own startup venture.

Image credit: Steve Jurvetson/Wiki Commons

In 2016 the Barack Obama administration instructed the federal Bureau of Prisons to phase out contracts with private prison companies. But incoming Attorney General Jeff Sessions overturned the order last week.

Asserting that the previous administration’s decision “impaired the Bureau’s ability to meet the future needs of the federal correction system,” Sessions ordered the BOP to return to its previous way of managing prisons. At its peak in 2013, the federal prison system housed almost 30,000 inmates within privately-operated prisons, or 15 percent of the federal prison population.

In August 2016, former Deputy Attorney General Sally Q. Yates (who was fired by President Donald Trump last month over her refusal to defend his travel ban) announced that as each private prison contract reached its, BOP was required to either decline its renewal or significantly reduce its scope.

“They simply do not provide the same level of correctional services, programs and resources; they do not save substantially on costs,” Yates wrote of private prisons in a memorandum to the BOP. “[And] they do not maintain the same level of safety and security.”

The change in policy will be a boon to companies that contract with the federal government for prison management services. And the results are“justifying investor bets on the impact of Donald Trump’s plans on crime, immigration and deportation," wrote Chris Strohm and Bill Allison of Bloomberg. Strohm and Allison pointed out that one prison contractor, Geo Group, donated $225,000 to a pro-Trump super political action committee and another $200,000 to a Republican senate super PAC. Another company, CoreCivic, donated $250,000 to Trump’s inauguration committee in December.

Both companies’ stock prices enjoyed a boost since Sessions’ memo was publicly released on Feb. 21. CoreCivic’s stock rose from under $33 a share to $35 at Friday’s close. Shares of Geo Group also jumped from just over $46 a share last Tuesday to almost $49 a share when the markets closed Friday afternoon.

Geo Group in particular has certainly been bullish about its future projects. The company, which describes itself as a “leading global provider of essential government services,” recently announced a $360 million acquisition of Community Education Centers, “a leading national provider of rehabilitative services.”

Despite the Obama administration’s policy and Sessions’ recent reversal, the reality is that, historically, state and local prisons have long held the lion’s share of America's privately-run prison population. The results, say some critics, have not necessarily offered relief for taxpayers. And one study suggests recidivism can actually increase in inmates housed in private facilities.

NGOs including the Sentencing Project say that despite companies’ promises to provide prison management services more cost-effective than publicly-run prisons, research over the past 20 years suggests those assumptions are not necessarily the case. One problem, as the U.S. Government Accountability Office reported a decade ago, is that even if a prison management company is publicly-owned, the data it provides its own clients often lacks transparency.

Journalists and academic studies have also suggested that the drive to increase profits per-prisoner, along with privately-fun facilities’ tactics to lengthen prison times, can drive up the costs of privately-operated prisons.

But even though the most recent federal crime reports indicate a mixed bag of statistics, the overall U.S. crime rate has been on a steady downward trend since peaking in 1991. Nevertheless, the Trump administration’s determination to increase deportations indicate that privately-run prisons will again be in demand.

Critics say many voters’ fears of illegal immigration and lawlessness catapulted Trump into the White House. But the stubborn truth is that deportations spiked sharply during the Obama years to a point at which the former president’s detractors called him the “Deporter-in-Chief.” Obama’s eight years in the White House presided over the largest raw number of deportations in U.S. history – policies that were arguably harsher than those of his predecessor, George W. Bush.

Now Trump is poised to accelerate that pace, which means more space will be needed in state and local prisons, as well as the services of private prison contractors.

Image credit: U.S. Customs and Border Patrol/Flickr