The Next, Episode #33
Religious wars, how I'd fix the food system, and going nuclear
Hi there, and welcome to The Next - my take on health, wellness, and brand building.
In the last 4 years I’ve founded 3 health brands (Kettle & Fire, Perfect Keto, Surely), which each do tens of millions in revenue. I’ve raised ~$20mm to build Kettle & Fire, gotten into 10k+ retail stores, bootstrapped Perfect Keto, launched 80+ SKUs… and have a small portfolio of Shopify apps I run on the side. Previously, I worked in tech and had no experience in CPG, DTC, or any other 3-letter industries.
If you missed past episodes, you can catch up here (Episode 30, 31, 32). Otherwise, let’s dive in!
🆕 What’s new
I’ve written before about how everything is becoming political. Losing weight, eating meat, getting vaccinated… all choices that signal your red tribe / blue tribe affiliation. How did we get to this point where politics, anger, and polarization have made their way into everything?
I suspect you can better understand politics today by thinking of politics as a religious war. We don’t have two political parties working to create positive outcomes for a shared nation: we have two religious factions battling it out for ideological supremacy.
Why now? My suspicion is that people feel like - at some point - our major institutions just kinda stopped working. Trust in major institutions (government, media, “experts”) is at all-time lows, and many feel like these systems just plain aren’t working for them. And once people feel like things are no longer working, they start to look for enemies, to figure out who caused this. Thus we go from “things aren’t working” ➡️ ”it must be their fault” ➡️ recruiting allies to fight with you in the culture war ➡️hyper polarization.
Viewing our political landscape as a religious war has also helped me understand just why it is that discussions and choices seem so darn personal: the red/blue religion is part of many people’s core identity, not just a party they affiliate with. If someone says they hate my local gym, well, fine whatever. Yet the minute you signal beliefs different from mine, well, we’re suddenly on opposite teams. The political becomes personal.
This is where I think we are today: two religious groups, battling out the endless, churning cultural war. Ironically, I suspect this state of affairs won’t change until we have more and better filter bubbles. Today’s media and tech platforms are optimized to enable one tribe to dunk on the other: until that changes (likely via more opt-in media channels like Substack), well, get used to it. I guess.
💪 Health stuff
At lunch a few weeks ago, a few friends asked an interesting question. If I could do anything to improve the health of the US population, what would I do?
In my humble opinion, the thing I’d focus on is removing crop subsidies for wheat, corn, and soybeans.
Since 1995, corn subsidies in the US have totaled more than $116 billion since 1995: an average of over $4 billion per year. Wheat and soybeans aren’t far behind, at $48 and $45 billion each (1). And, shocker, because these crops are so heavily subsidized, they’re also by far the most abundant:
Because these crops are subsidized, they are planted everywhere. Farmers are incentivized to plant as many of these crops as they can, because they are practically guaranteed to make a profit. This profit guarantee means that farmers plant corn/soy/wheat in greater amounts than humans actually consume: in fact, less than 1% of all corn grown in the US is the sweet corn that’s eaten in its unprocessed form. Most of the corn grown here - that taxpayers subsidize! - is in fact used for animal feed, food additives (“residual use” in the graph below) and/or alcohol for fuel use.
Because these three crops are both planted everywhere AND are subsidized, corn, soy and wheat are all pretty darn cheap. And because they are cheap, they have made their way into everything. Have you ever wondered why Coca-Cola uses high-fructose corn syrup (HFCS) in Coke rather than real sugar?
It’s not because it tastes better: it’s because it’s cheaper, thanks to rampant corn subsidies! These subsidies have artificially made corn cheaper than sugar, which means there’s an incentive for Big Food companies to increase their margins by using it, which means that - within just a few decades - HFCS is now in everything and giving your mom and grandma diabetes.
Unfortunately, this doesn’t stop with corn. We’ve seen an explosion of gluten intolerance and allergies in the last few decades. Partially, I suspect this is driven by poor gut health and environmental contaminants. And partially, I suspect it’s because there is now wheat - highly, horribly processed forms of wheat - in nearly everything. Soy sauce, sauces, pickles, hot dogs, blue cheese, and vitamin supplements are all surprising things that contain gluten. Not because it tastes better - it doesn’t - but because wheat gluten is often the cheapest binder Big Food can use.
Why cheap? Again - subsidies!
I’ve talked before about the negative impact of vegetable oils on human health. Well, crop subsidies also play a role here. Before soybeans were so heavily subsidized, American consumption of soybean oil was basically negligible.
Today, after $45 billion of crop subsidies, the average American gets 20% of their calories from toxic, highly processed soybean oils (2)! Again - not because soybean oil is delicious! But because - thanks to crop subsidies - it’s cheaper for Big Food to spend a bunch of money turning dry, definitely-not-oily soybeans into oil for human consumption.
These subsidies also ensure that soybeans make their way into animal feed, as about 70% of soybeans are fed to chickens, pigs, and cows (3). In their natural environments, these animals would never eat soybeans: now, this subsidized, artificially cheap crop makes its way into feed of all kinds, human and animal.
In my opinion, these crop subsidies have directly led to the sickest, least healthy crop (heh) of Americans the world has ever seen. We’re overweight, we’re obese, and we suffer from chronic illness at a rate never before seen in history 🇺🇸. And the billions of dollars we, the taxpayers, pour into crop subsidies each year is a direct contributing factor.
Though this is an issue with a lot of lobbyist money behind it (after all, 33% of all subsidy dollars go to large corporate farms vs smaller, individual farmers), it’s one that just might be tractable. Rather than trying to remove these subsidies (which would be great, but f’ing hard to do given corporate interests), I wonder if you could lobby to subsidize nutrient-dense fruits and vegetables along with the corn-soy-wheat staples. If farmers could grow nutrient-dense crops at cost parity to the staples, I suspect we’d see a lot more vegetables making our way into the food system.
This is the type of upstream, unsexy policy work that I’d love to fund and talk to activists and others who are working on this stuff. If that’s you, or you know of an organization working on unsexy interventions like this in our messed up food system, please reach out!
🤑 Biz stuff
In this post, I’m going to wade a bit out of my depth here and talk about energy. I’m hoping that openly sharing my thoughts will allow me to take advantage of Cunningham’s law.
The cost of energy is upstream of almost everything in politics and business: if a nation has cheap energy, they have a LOT more economic flexibility. Cheap energy translates to affordable food, affordable production goods, and pretty much everything that we consider a benefit of living in a developed country.
In episode 29 I talked about how I thought that - thanks to increased energy prices and issues stemming from the UKR conflict - there was a high likelihood of global famine later this year. Well, it seems like that may already be happening.
I’m sure many of you have seen the chaos happening in Sri Lanka. A large part of the reason for Sri Lanka’s collapse is related to the ban of synthetic fertilizer and pesticide imports in the spring of 2021, due in part to fertilizer price increases. Essentially overnight, Sri Lanka’s farmers were forced to transition to organic farming and remove chemical inputs with no time for transition… leading to a 20% drop in rice production and 18% drop in tea production (the country’s largest export).
Earlier this week, California gubernatorial candidate Michael Schellenberger posted an article on his Substack called “Green Dogma Behind Fall Of Sri Lanka.” Here’s the key passage:
“But the underlying reason for the fall of Sri Lanka is that its leaders fell under the spell of Western green elites peddling organic agriculture and ‘ESG,’ which refers to investments made following supposedly higher Environmental, Social, and Governance criteria. Sri Lanka has a near-perfect ESG score (98) which is higher than Sweden (96) or the United States (51).”
As we’ve talked about previously, fertilizer and food under our conventional agriculture system are essentially derivates of energy prices. As energy prices go up, food prices go up: it’s as simple as that. And likely a large reason why here in the US, we’re seeing 15%+ annual inflation across meat and eggs (3).
I agree with Doomberg here: that ESG-motivated policies actively caused the collapse of Sri Lanka. And these same “green energy” ESG policies will cause similar issues in both Germany and the US if things don’t change course.
For more than a decade, Germany has pursued an “Energiewende” energy policy aimed to transition the country to a “low carbon, environmentally sound, reliable, and affordable energy supply.” Despite investing several hundred billion Euros implementing Energiewende, the plan has not worked. Even before UKR, Germany had among the most expensive electricity in the developed world. Now, with Russia threatening to ration natural gas and energy costs still exploding, Germany is beginning to ration hot water, dim their street lights, and shutting down swimming pools to limit energy consumption (4).
Nuclear has by far the highest energy return on investment. A country that refuses to go nuclear is one that - like the UK - will be forced to tap into coal and other energy sources to keep the lights on and their economy functioning.
As energy prices have gone up, major exporter Germany has suffered its first trade deficit in more than 3 decades. And things don’t seem likely to get better for them as winter approaches.
Worse, the US is making a similar mistake. We’re falling for the same psyops here, as California and New York both plan to shutter their nuclear plants.
That said, there is hope on the horizon. More and more Americans are signaling support for nuclear (5), and the US recently approved NuScale’s small nuclear reactor design. Today, just 93 nuclear reactors provide 18.8% of all electricity in the US, with zero carbon emissions. With China planning to invest in 150 nuclear power plants over the next decade (6), I’m hopeful that the US follows suit and gets behind the cheapest, most efficient, and greenest form of energy currently known.
😌 Dope stuff on the internet
Some of my favorite things since the last newsletter (note: I don’t get paid to recommend anything here):
📰 Article - The best post I read this month was Erik Torenberg’s The Hypocrisy of Elites. So many of the Current Things that enter the culture war crosshairs - “body positivity” (ie obesity is healthy), the role of luck in success, carbon emissions - are beliefs that our elites promote but do not follow. Erik’s post was the best summation of this idea I’ve come across. And once you see this in action once, you see it everywhere.
📚 Book rec - I’m about halfway into Balaji’s The Network State and - as you might imagine - it’s incredibly thought-provoking. Balaji outlines his thesis as to how and why now is the time to build new pseudo-countries (that he calls Network States). I’ve been wondering what it might be like to start a fully health-focused city: an opt-in community where you are literally unable to make an unhealthy choice if you live in the town, and I’ll say this book definitely got me thinking.
Also, if you’re looking for more of a fiction read, I devoured Altered Carbon.
⌚ Cool product - Being healthy is expensive, but doesn’t have to be. I’ve been working with a new company, True Medicine, that just launched into beta. With True Medicine, you can pay for healthy food (like Kettle & Fire!) or fitness activities (Barry’s classes, Peloton, etc) using money in your HSA/FSA accounts. Basically, you can pay for health and wellness spend using pre-tax money, which allows you to save 30-40% on everyday wellness spend. I’m really excited about the problem as it helps solve one of the key issues I see in the US healthcare system and make it more affordable.
🎵 Music - This Tony McGuinness set is absolute gold. I’ve been a big fan of Tony’s for a long time, and this is by far one of my favorite sets of his (plus its over 2 hrs!).
🏀 Random - Last month, I went on a 3-day hike and took what was probably (sadly) the longest break from technology I’ve had in at least 2 years. It was f’ing awesome. Though working online has enabled many amazing things in my life, I’m distinctly too attached to being online all the time. I’m now working on carving out more time away from devices a few times each year.
🙋♂️ Asks - I’ve finally started doing more public angel investing, and am starting to share some deals I’m looking at on my AngelList syndicate. If interested, apply to take a look at deals I’m doing, and if you know of any interesting or weird companies raising, please let me know!
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That’s all I got for you this month squad! Thanks for tuning in and a warm welcome to the 300+ of you that have signed up since the last time I wrote. Until next time!
👋 Justin
I felt extremely anxious without constant pull of information when I went on a 2-day hike myself. It took some meditation and time to get used to calm down. Have you felt any anxiety of the beginning of it and how have you dealt with it?