Jun 10, 2019

Axios Future

By Bryan Walsh
Bryan Walsh

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Today's Smart Brevity count: 926 words, ~4 minute read.

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1 big thing: The no-name chocolate maestros

At Dandelion Cafe, San Francisco. Photo: Molly DeCoudreaux/Dandelion

Wine experts get loads of respect, with their oenologists, viticulturists, masters of wine, not to mention white-gloved sommeliers. Ever since Starbucks elevated the cup of coffee, "Q graders," the mandarins of the Arabica bean, have achieved similar gravitas. Craft beer has its cicerones.

Now, a still-tiny phalanx of fancy chocolate companies, most based in the U.S., think they are on the brink of the same sort of coming of age.

Their product has not yet reached the zenith of niche dining — a fancy appellation to single out its best experts. But exotically sourced chocolate may be the new thing in haut cool.

  • A decade ago, there were just a dozen or so small U.S. companies buying and processing cocoa beans for ultra-premium craft chocolates, said Emily Stone, founder of Uncommon Cacao, who talked to Axios from Belize.
  • Today, the number is about 190, according to the Fine Cacao and Chocolate Institute, and 480 around the world.
  • "We're at the beginning of a chocolate revolution," said Megan Giller, author of "Bean to Bar Chocolate." "We now have access to some of the best chocolate that has ever existed, with brands like Dandelion, Patric and Fruition blowing my mind consistently."

The big picture: Americans spent about $22 billion on chocolate last year, almost a 1% increase over 2017, according to the National Confectioners Association. But sales of premium chocolate, approximately 6% of the market, grew by more than 19%.

  • By comparison, specialty coffees account for some 59% of all of the coffee consumed in the U.S., according to the Specialty Coffee Association.
  • And craft beers are about 23% of U.S. retail beer sales, says the Brewers Association.
  • "We are about 20 years behind everyone else," said Ed Seguine, an authority on flavor in cocoa beans.

But craft chocolate is growing.

  • What craft chocolate is: Premium and fine craft chocolates are made in small batches at small companies with much higher cacao content than the 10%–30% contained in most mass-market brands. The beans come from around the world but mostly Madagascar and South America.
  • An example: Dandelion Chocolate runs a factory and cafe in San Francisco's Mission District, where it serves handmade baked goods using 70% cacao content (see photo above). It is frequently packed with customers.
  • As of now, the typical customers for craft chocolate are older millennials with above-average incomes who are concerned about social and environmental issues, said Bill Guyton, executive director of the Fine Chocolate Industry Association.

The growth in sales does not necessarily mean that chocolate is the next Starbucks. But consumers are demanding less-sugary and darker chocolate, says Kristy Leissle, author of "Cocoa" and a professor at the University of Washington. "For me, the question is how far will this trend go? Will consumers keep on this quest for healthy living through chocolate, and will the big manufacturers and processors continue to innovate to meet this demand?"

Chocolate has a resonance that is missing from the others.

  • "Chocolate is not about food intake," Seguine said. "It's about passion, romance, ecstasy even. It's about memories and shared relationships. Chocolate is not something we need as part of our diet. But it is something our soul needs."
2. A new era of antitrust

Photo: Hulton Archive/Getty

A slow but increasingly determined drumbeat to update antitrust laws — held over from the time of enormous railroad companies — has tech companies in the crosshairs, but could spill over into other merger-happy industries.

What's happening: Asked today whether Google, Facebook and other tech giants are too big, President Trump told CNBC, “Obviously, there’s something going on in terms of monopoly.”

What's next: Monopoly-busters have largely focused on the short-term effects of a merger — does it drive up prices, are consumers immediately worse off? But a longer view could change the playing field for modern monoliths, writes Axios' Dan Primack.

For tech companies, the focus on price is something of a loophole. It can perpetuate Big Tech dominance, as consumers don't pay direct dollars for services like Google, while Amazon's size helps it lower prices (at least in the short term).

  • Categorizing some Big Tech platforms and infrastructure in a category of new, 21st-century public utilities could be a way forward.
  • Another is to consider what happens to consumer data, and not just price, when Big Tech firms merge.

There is plenty of fodder beyond Silicon Valley, too. The health care system, for example, is full of monopolies, writes Axios' Sam Baker.

  • That includes everything from big insurers and hospital systems all the way down to syringe-makers, IV solution companies and hospital bed manufacturers.
  • This all contributes to high health care prices in the U.S. compared to the rest of the world.
  • “America’s health care crisis is brought to you by monopoly,” Phil Longman, policy director of the Open Markets Institute, told Axios.
3. Stagnated wages for high school grads

High school graduation in Denver in 1991. Photo: Emmett Jordan/The Denver Post/Getty

Average wages for high school graduates in the U.S. are finally higher than they were in the middle of the financial crash — but they remain lower than they were in 2000, according to a new report from the Economic Policy Institute, Erica writes.

  • The average pay for white high school graduates increased about 1% from 2000 to 2019, but fell 2.7% for black graduates.

Why it matters: The cost of a college education is ballooning while incomes for high school grads are shrinking, making young Americans increasingly reliant on sky-high student loans if they want degrees.

4. Worthy of your time

Illustration: Aïda Amer/Axios

Walmart workers who feel like robots (Drew Harwell — WP)

Profiting from prison (Stef Kight, Dan Primack — Axios)

China moves to stop an electric car crash (Bloomberg)

Experts at work (People are awesome — Tweet) (video)

The light side of America's darkest crime writer (Leo Robson — Economist 1843)

5. 1 AI thing: UN speeches in a box

Inside the UN. Photo: Atilgan Ozdil/Anadolu Agency/Getty

It took two researchers 13 hours and $7.80 in cloud computing costs to build an AI system that can generate fake United Nations speeches on refugees, climate change and nuclear disarmament on command, Erica reports.

In a new paper, reported by MIT Tech Review, the researchers detail how they pulled it off:

  • They took an AI program that had already been trained on text from Wikipedia and fed it all the speeches that were delivered to the UN General Assembly from 1970 to 2015.
  • The speech generator's work "matched the style and cadence of real UN speeches roughly 90% of the time," per Tech Review.
Bryan Walsh