The Hightower Lowdown

High Tech Brought Low; All Expenses Paid


High Tech Brought Low

Well, the high-flying high tech industry has certainly hit a downdraft, with many gazillionaire hotshots suddenly reduced to mere millionaires, having been brought closer to earth by a couple of basic business questions: One, "Do you actually produce anything?" and Two, "Do you produce anything people actually will buy?"

An example is right here in my hometown of Austin, where a software start-up company calling itself Agillion was awash in venture capital, had a couple of high-profile techie stars at the helm, and was considered a can't-miss business success by Wall Street. Agillion's founder was a guy named Steve Papermaster, who had sold his previous company for a third of a billion bucks. He'd also played host to a widely ballyhooed Fortune 500 CEO confab in Austin last year, he'd raised a ton of cash for his political pal George W. Bush, he has been mentioned as a possible official in Little George's administration.

But -- poof! -- much of the glitter is gone from Papermaster's golden boy image. Only a year ago Agillion was so cocky that Steve even wrote a $3 million check for one advertising spot during the 2000 Super Bowl broadcast. But now, Steve's been ousted as honcho of Agillion, the stock price has plummeted, the company has a negative cash flow, and half of its staff has been dumped. Maybe it could change its name to Half-A-Gillion.

It turns out that the geniuses behind Agillion didn't know much about the business they were in. The company was founded to provide customized Web pages to help small businesses communicate with their customers. It turns out, though, that not a lot of small businesses had any interest in buying this software, and that Papermaster and team had miscalculated on the product's price, making it next to impossible to cover their cost of production, much less make a profit.


All Expenses Paid

Lockheed Martin, America Online, MGM Grand Casino, Philip Morris, Archer Daniels Midland, Microsoft, and oh so many others are among the major corporations that eagerly plopped down $100,000 each to fund George W. Bush's inaugural festivities. They're eager to shove so much money at the new president, not because they love a good party, but because each of them has special governmental favors they need from him, and they know that money has always been a good way to grease George W.'s skids.

However, the Bush team had to be sensitive to the fact that such flagrant money exchanges are despised by We the People, so the Bushites made a big show of limiting corporations and individuals to maximum donations of "only" $100,000. This is Bush's idea of egalitarianism: Anyone can give $100,000 to his party fund, but no one can give more.

As always, however, Bush integrity had a loophole, and several outfits leapt nimbly through it, grossly exceeding his so-called maximum donation. For example, Carl Lindner, CEO of American Financial Group, donated $200,000 in his own name. The Bush team publicly repudiated his excess and sent half of Lindner's money back. No problem -- Carl simply wrote another $100,000 check, this time in the name of his company. So he gets credit for $200,000 without technically exceeding the advertised limit.

Likewise, Pepsico sent in $200,000, but said that half of it was from its subsidiary, Frito-Lay. Marriott played this subsidiary shell game, too, donating $100,000 in the corporate name, then another $650,000 in the name of its subsidiaries.


Pharmacy Farming

As every child knows, "Old MacDonald had a farm," but industrialized agribusiness is rapidly displacing Old Mac, replacing our family farmers with corporate pharmacists who fatten their livestock not with grass and corn, but with antibiotics. E-I-E-I-O!

The nonprofit, independent research group, Union of Concerned Scientists, recently issued a report revealing that cows, pigs, and chickens are being fed much more massive doses of antibiotics than the drug companies and livestock corporations have admitted. These drugs are not being administered to treat animal diseases, but simply as a quick and cheap fix for fattening the animals. The UCS reports that while only 3 million pounds of antibiotics are used each year to treat humans, industry is feeding 3.7 million pounds of the drugs to cattle, 10.3 million pounds to pigs, and 10.5 million to poultry -- all to speed up their growth.

This nontherapeutic use of antibiotics means fatter profits for the drug and agribusiness giants, but it poses a real and present danger to you and your family's health. Such overdosing means that bacteria that have a natural resistance to any given antibiotic survive in the animals, becoming "superbugs" that can't be killed by that antibiotic. So, when you eat beef, pork, or poultry contaminated with these superbugs, the very antibiotic medicine that could have saved you before ... is now powerless.

Another study by the Center for Disease Control finds that 14% of the bacteria that cause pneumonia are now resistant to three classes of antibiotics used to fight them, and that 25% of the pneumonia bacteria are immune to penicillin. Likewise, salmonella bacteria are now being found to be immune to the antibiotic used to treat the most severe cases of salmonella food poisoning -- an antibiotic related to those used to fatten livestock.

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