Corbin loved words like “fractionate.” I would have to spend an evening with the dictionary just to understand half of what he had been saying. But I could see a problem right away.
“If garbage is such a God-damned delight, why has nobody ever gotten rich off it before?”
Corbin puckered up his mouth and thought about that one for ten seconds, max. “Because,” he said, “no one has taken in the scope of it. Like a kid going to the town dump, everyone has looked for a particular prize. Aluminum, they say, we could take that out! Except the market isn’t high right now. Or the cost of separation is too great. So the project isn’t feasible.
“Or, take the old recycling programs. They’d go after a wider range of products, sure, but only if the people throwing them away—the recyclers’ suppliers—would spend the time to separate the green bottles from the brown, the aluminum cans from the steel, then haul it all in their cars to a collection point. It was too much trouble for most people, so the volume was never big enough to compete, economically, with scraping away whole forests and raping the Earth.
“But when you go after the whole enchilada, ‘every part of the pig but the squeal,’ as the old-time packers used to say, then your separation costs are lumped together. They become a smaller part of the overall cash flow. And by dipping your hand in half a dozen different markets at once, you can weather the periodic slumps. When aluminum’s down, wood pulp may be up, or chemical feedstocks, or gold.”
“How do we get this garbage?” I asked.
“You already own it, under the same legal fiction by which the EPA made it your responsibility for cleaning the garbage up. City scavengers will already truck the solid wastes thirty miles to an approved landfill—so let them send it to your reclaiming station. The sewer system runs twenty miles to a wastewater treatment plant—so build a fractionating plant next door.”
“Who is going to put up the money for all these plants?”
“Anybody who wants to get rich. There’s a venture capitalist born every minute, Billy. All you have to do is dazzle them out of the trees.”
Corbin picked up his fork and began eating the eggs, cold salsa and all.
Dazzle the investors we did, with colored brochures showing an artist’s renderings of processing plants. We gave them reams of computer analysis showing discounted cash flow and return-on-investment projections. We even had tiny lucite capsules made up with samples of real garbage sealed inside. Corbin and I raised such a big chunk of working capital that we seriously debated, for half an hour, putting it in a satchel and flying to Mazatlan. Finally, Jay—or Granny—pointed out that three times that amount was available in credit lines and bond underwritings, but we could only get our hands on it by going ahead with the project instead of running. I had to take that on faith, but we went ahead.
We started with a demonstration plant in Alviso on the edges of the Bay’s marshlands. It was sized to take in 50 tons of municipal solid waste a day. The machinery that worked with the garbage was really simple: It ground up whatever came in, metal and all; cooked it till the fibers and plastics were softened; mulched it to digest the organic matter; and ran the whole mess through a set of centrifugal separators. We could then reprocess the almost-pure fractions of metals, glass, organics, and oils: melting the first two, pelletizing the third, refining the fourth.
The only thing our first plant could not do was separate the green glass from the brown. For a while, we let them mix and added a heavy shot of nickel oxide to the molten glass, producing a deep-purple color. That turned it all into black glass, which has an industrial and artistic market. But we soon found a high-temperature process to settle out the green and brown dyes and make clear glass, which is more widely saleable.
The Alviso plant cost us about N$2.5 million to build. It returned more than N$1.5 million a year at the market rate for refined products, not even counting what we charged the local businesses and municipalities for taking their “wastes.” Oh, we did give them a nice walnut plaque, laser-engraved with the signature of their local Environmental Protection Agency representative—me—affirming that they had complied with all regulations for safe disposal of solid refuse blah-de-blah-de-blah.
When we branched out with city scavengers, our cash flow started seesawing. It took five months for Corbin to figure out that the secret to the residential market was seasonality.
“Bid up the price of metal in December and January,” he advised. “There’s more aluminum foil then: Christmas tree tinsel and wrappings for gifts, leftovers, and the neckwrappers from champagne bottles. There’s more other metal, too, when people are throwing away last year’s bicycles, ski poles, and video recorders.
“Bid up cellulose in April and May, when everyone is tossing away scratch paper while they figure taxes and throwing out a year’s worth of old magazines during spring cleaning.
“In summer,” he said, “the profit comes from plastics. Everything from suntan oil to franks is packaged in plastic bottles and film. And we’ll eat it all.”
So I would reset the separator equipment in the plant to track these greater seasonal volumes and we made an even higher margin. Yes, I was the manager, the chief operating officer, and the practical hand. Corbin, with his polished manner and his feeling for the money end, became our chief executive and front man.
What did we call the company? The paperwork said “Alviso Associates, Inc.,” which was smart, you see. To our suppliers of municipal solid waste, we were just garbage men. To our buyers of refined products, we were metals servicemen, glass wholesalers, paper makers, oil retailers. And when we branched out into sewage sludge—selling end products like methane, garden fertilizer, and animal feeds—well, the separation of our image became even more important.
At the end of our first full year, we toasted in 2001 and the new millennium with a magnum of champagne that we drained then dropped in the grinder. Within five years, Corbin and I had ten plants going all over Northern California and were well on our way to owning half of the markets we sold to. Who could compete with us when we got paid to take our raw materials and produced just as much as each market needed?
I was content with getting good at this business, making my fortune from it, and being comfortable, but not Granny Corbin. He was too restless. As soon as he had a few hundred thousand out of the garbage business, Corbin backed a turn at the Montana State Lottery. All he had to do was put up a share of the prize money and pay off the administrative costs for the week. Then he could take fifteen percent of the receipts off the top and no taxes to pay. The balance went into the State fund. Corbin was guaranteed a two hundred percent return, minimum. He made six hundred percent that first week.
The only hitch to this little moneymaker was that the backer could not return to the well whenever he wanted. No, he had to sign up for a slot five weeks in advance. And until then, he had to put a percentage of the stake on deposit with the State Gaming Commission, which of course got beneficial use of the money in the meantime. However, the only risk was that while he was waiting, the people of Montana might lose their taste for Lotto-Jotto. You should sooner bet against sunrise.
In nine months, Granny was making as much money on the games as we had made in two years with the garbage. And still he was restless. So he bought a seat in the Southwest Electric Energy Pool. The usual asking price was five million, but he knew a broker who was in distress through a series of dumb deals that went sour. He would sell out for three. Corbin bought the seat but did not occupy it himself. Instead, he staffed it with professional representatives from Barton & Badger, the biggest pooling house in the nation. Corbin himself could sit back and watch the really big money roll in.
How did S.W.E.E.P. and the other regional markets get so big and—um—powerful? It was another fallout from the Money Warp that the economy went through.
After the power crunch of the Nineties—which some people say was caused by deregulation of the national electricity grid, and others believe just happ
ened at the same time—local utilities were hurting for available sources of energy. Of course, they had all long ago negotiated complex interconnection agreements, through their regional power pools. But in the palmy days of easy energy, these agreements were for mutual, short-term coverage. In formal language, the utilities told each other, “You help me meet a peak load this afternoon and I will pay you back with power tomorrow morning.” Their contracts merely specified a set of exchange rates, which were based only on the amount of power and when it was taken.
These mutual pooling agreements did not, could not foresee a time when local regulators, on the State or county level, would turn the simple decision to build a power plant into a twelve-year session of People’s Court. When the cost of capital would push the price of a kilowatt of installed capacity to as much as N$170,000. Or when, as a result, a couple of loose megawatts kicking around in a utility’s resource plan would draw a dozen bids from other utilities, industrial parks, shopping malls, housing developments, and growers associations strung out over wires a thousand miles in any direction.
Anytime resources are scarce and demand is high, you create a market. And for electricity, the market centered around those early power pools. Except that instead of remaining helpful industrial associations, they became cockfighting pits where brokers wheeled and dealed energy from supplier to distributor to end-user. All it took was money and a telephone—and a seat in the pool.
Through enterprises like our joint garbage processing, Lotto-Jotto, and S.W.E.E.P., and a dozen real estate deals and side investments, Granville Corbin was worth about N$150 million by 2005. He quickly discovered, or maybe he knew all along, that this kind of money had velocity. He had no Federal taxes, not on income, capital gains, excises, nothing. Most of the State taxes he might have owed could be ducked by operating interstate and moving assets around at opportune times. The States had not yet learned to cooperate by sharing data bases and holding joint audits. The net result was, his fortune was growing at about sixty percent a year, minimum. Which meant that in four years, he was worth almost a billion new dollars; in six years, two and a half billion; in seven years, over four billion. And that was just figuring on the bad years.
Corbin did have some braking mechanisms. He gave money to charities. He built a new wing on the law library at Harvard. He funded a home for orphaned Hispanic children in Monterey. He even set up a foundation with an educational bent, which he once told me had access to ten percent of his assets. These were all good works, from the heart. They had to be: After all, he got no tax deductions from them. Of course, he was making a name for himself. On the two coasts he was known variously as a smart financier and a great philanthropist.
I just looked up that word and it means he loved people. Women especially.
But Corbin was cleaning up his act. Putting a polish on it. Where once, when he and Anne were living in San Francisco, he would chase anything that had two good legs and an itch between them, now he was only seen publicly with respectable young women of the marrying kind. And, at the end of an evening, he was only seen to kiss them chastely in the elevator lobby and saunter off to the Rolls. In five years, Granny had earned a reputation on both coasts as a gentlemanly heartbreaker. Until he met Tracy Starrett—she was the pretty one.
Corbin and I had grown apart during those years. I was still managing grubby little garbage operations that now were not worth more than five percent of his time. It was a full-time job for me just becoming the municipal solid waste and sludge king of the West Coast, while Granny was always in motion, making money and a name for himself. He flew in just once a month for Alviso Associates’ board meetings. So by the time he turned up with Tracy Starrett on his arm, and she had a rock ring on her finger, it was too late to give him any fatherly advice.
You see, I had seen the face and remembered the name. Tracy was from one of those families that are richer than the Rolling Stones and all of them orbiting farther out than the asteroid belt. Her father was some kind of money connection to the Overthrust Formation gas fields out of Denver. Her brother wholesaled crack, cobra, and a collection of designer drugs along a 2,000-yard strip of the beach at Venice, California. One sister became a big mama in the kiddie porn around Portland, Oregon—which was how I knew the family—and was giving her younger sister lessons. Tracy had done some fly-weight modeling while still in high school, then had a couple of walk-ons in those low-budget formula flicks where the superhuman ghoul cuts up lots of nearly undressed teenage girls and also, by the way, boys.
Denver in the Oughts was one huge house party for white-anglo girls like Tracy. Corvettes, cocaine, and cock till it was coming out of their ears. The local police did not even try to stop it, just keep them from using their Porsches to score points on little old ladies crossing the street.
Tracy, however, had been busted on a morals charge when an almost-hit-and-run was followed up to a motel in Arvada where she and seven other mixed sexes were surprised in various states of undress and also penetration. That was no problem, except Daddy’s VCR was rolling and the movie lights were disturbing the neighbors. Ditto the heavy-metal beat. You see, the action was poolside. The oldest one there was Tracy, who at nineteen was considered an adult and a bad influence. The judge gave her a stiff lecture and probation, which still constitute a record in the State of Colorado.
Since that time, Tracy had evidently been polishing her act, too.
I did not know all this when she first turned up on Granny’s arm; I just remembered Tracy’s name and face and a faintly bad aroma. It took me a week to track down the references. By that time, they were back in New York and all over the society pages. Wedding bells were in the air, as they say, and who was I to call long distance and spoil the fun?
Maybe they deserved each other.
Chapter 10
Granville James Corbin: 100 Lost Days
I personally witnessed the start of the Hundred Lost Days. Well, I wasn’t actually in Washington to see it, because then I would have been dead, right? Or my eyes would have been burned black and my head torn off. But I was nearby, in Laurel, Maryland, which is on the Patuxent River, halfway to Baltimore.
It was during a research trip, a tour of Old Line State Scavengers’ new solid waste plant. They were trying out a new dry process, first shredding the material with diagonal cutters and then spewing it into an air column for gravity separation, like wheat and chaff. All the heavy stuff fell to the bottom of the column, where they took out the ferrous with magnets.
The process had a couple of disadvantages. For one, their handling of nonferrous metals was clumsy. They just tumbled all the aluminum, copper, and fragments—plus any steel the magnets didn’t pick up—in a big drum that settled it out in layers of, they hoped, similar material. However, the process was more suited to separation by size or weight than by specific gravity, which is what they were groping toward. But frankly, our own wet process wasn’t doing such a hot job with nonferrous either. We were selling some pretty strange alloys and couldn’t promise more than about fifty-five percent purity.
For another thing, Old Line was losing all the oils. That didn’t matter to them too much because they were pelletizing all their paper and fibers for furnace feed; so the embedded organics and plastics just made a hotter fire. But they knew what they were missing and had called me in to consult.
It was a clear December day, bright cold, about four in the afternoon. Our tour of the plant had just arrived at the maw where the trucks from Baltimore dumped their loads. This was a concrete funnel, twenty feet wide and fifteen deep, with a shiny screw conveyor thirteen inches in diameter running along a trench at the bottom. We were on the southwest side of the building and the low sun was casting long shadows. I noticed quite a pileup of loose paper and aluminum cans along the concrete wall on the southwest side of the truck turn-around. That told me they were using open trucks and the light stuff was fluffing off the top as they positioned for the dump. What would they be losing in that?
While Walt Doury, the plant manager, talked on about hauls per day and tons per haul, I bent down to study the sludge of stuff by the wall. Under a loose top layer, most of it was wet, slushy pulp with the cans flattened by truck tires so their losses were worse than I thought. I turned my head, still bent over, about to call their attention to my findings, when the group’s shadow suddenly leapt into focus. The metal siding of the building behind them brightened until its tan paint shone almost white, with the outline of their heads and shoulders in deep black.
Some instinct held my body, kept me from straightening.
“Jesus Christ! What was—” Doury broke off. His face in the white glare was slack with surprise.
“God, look at—” one of the others began.
“Don’t look!”
And, after a few seconds, from a third man: “I can see—see something like a—a white blob. But I can’t see you, John, and I’m looking right at you!”
“Was that Washington?”
I counted ten under my breath, raised my forearm—ready to shield my eyes—and stood up. Real slowly. There to the southwest was the setting sun. And beside it, brighter, redder, rose a ball of fire that was mottled and veined like the head of God’s penis. It was connected to the treetops by a glowing rope of smoke. I knew by my guts that it was Washington. And I knew by the map it was about fifteen miles away.
What could we expect at this distance? Radiation poisoning? Probably. How much we picked up would depend on the megatonnage of the blast, with the radiation’s intensity dissipating under the inverse square law, of course. That scurf of paper alongside a concrete wall may just have saved my life, but the Old Line men with me could all be dead and not know it yet. Nothing we could do about it now: We took our dose twenty seconds ago.
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