00:01hey everyone today we need to talk about something that just happened in
00:05California that nobody is connecting the bigger picture so imagine this for a
00:10moment 1910 11 California almond farmers band together in Sacramento because
00:16they've tried they're tired of the middleman taking their pay they script
00:20together enough to build a small packing house at the rail yards and by 1915 they
00:26have a name and a symbol the blue diamond sons farm beside fathers families
00:32become districts districts become a cooperative and over the next century they
00:37invent the first almond sheller a first silvering machine the first electronic
00:43sorter they sent California almonds to Japan Britain Brazil to China by the
00:501980s of the world's largest almond cooperative 3,000 farming families
00:55eighteen hundred employees one blue diamond stamped on every box and then
01:01our own state capital prices them out CEO walks into a meeting 600 Sacramento plant
01:07workers and tell them they'll plant their grandfather's bill cancer 5 and blue
01:12diamond growers that's a company we are talking about the man who just signed the
01:18closure of their founding manufacturing plant is named Kai Bachmann his statement
01:24rippled through every food cooperative every farmer every manufacturer left in
01:30California and you might say I don't live in California well this pattern is
01:34coming to a state near you so hit that subscribe button because this one is going
01:39deep let's get into it so here's what's happening Friday morning June 6 2025
01:46Sacramento Bachmann walks into a meeting room at the company's 53 acre Midtown
01:52plant the same plant blue diamond has operated out of since 1914 and he tells
01:57people work in the line that the facilities closing 600 jobs are phased out
02:02over the next 18 to 24 months the first round of layoffs starts in September
02:07second comes March 2026 third is in September 2026 the 53 acres site goes up for
02:15sale operations consolidate to existing blue diamond plants in Turlock and Salida
02:20both deep in Central Valley away from the state capital and the same morning the
02:25company releases a public statement and Bachmann doesn't sugarcoat it he says and
02:30this is a direct quote the challenge of running a plant from these historical
02:34buildings has become too costly and inefficient that's a language the CEO uses
02:40when the math on a 115 year old facility has finally collapsed streamlining he calls it the
02:49right business move the cooperatives grower members come first even thanks a
02:53Sacramento team for the work ethic the drive that built blue diamond into what
02:58it is today before telling them that work ethic is now going to do its job
03:03somewhere else the closure announcement landed in every almond trade
03:07publication every Sacramento newsroom within hours and the moment the news broke a
03:14question started circulating California's agricultural industries if blue diamond
03:20can't make Sacramento work who can to understand why this announcement landed
03:24like a bomb on California's almond industry you need to know what blue diamond
03:30actually is because this isn't some Wall Street holding company shedding a
03:35satellite office blue diamond was founded in 1910 the California almond growers
03:41exchange the first successful grower owned cooperative ever created to market
03:47California almonds 11 families one packing house built in Sacramento because that's where
03:53the railroads meet the orchards by 1915 they had a brand blue diamond stamped on
03:59every box over the next century they invented half the technology the almond industries run on the
04:07the first commercial almond sheller the first size grader the first continuous
04:12blanching line the first electronic sorting machines the first commercial
04:17slivering and dicing equipment they open export markets in over 80 countries they put
04:24California's almonds on shelves in Japan in the UK in South Korea and Brazil by 2021 the
04:30cooperative was doing 1.59 billion in annual revenue and today blue diamond snack almonds
04:36brands brands owns more than half the US market almond breeze is the number one almond milk in the US
04:43South Korea Thailand Brazil South Africa the cooperative is owned by roughly three thousand
04:51California almond growers half of every almond grower in the state and the man who just signed the
04:58closure of their founding plan Kai Boakman isn't a homegrown executive he took the CEO job January 2023
05:05after running international operations at Saputo the Montreal based dairy giant before Saputo
05:13he ran international markets at McCain foods he arrived at California with a resume built on consolidating
05:19operations to lower cost geography and by 28 28 months later that exactly what he announced their own state
05:30capital price to mark because the second announcement landed Sacramento's economic establishment had to
05:36confront a problem they've been talking around for years California is one of the most expensive places on
05:43earth to operate a manufacturing business and the state capital itself just stopped being competitive
05:50Dr. Sanjay Varnish a finance professor at Sacramento State University the founder of Goldenstone Wealth Management
05:59didn't hedge he said and this is direct quote proof is in the pudding blue diamond walking away is just
06:05another sign
06:06there's something wrong with how we are doing business here and then he went a little further he called
06:13a lesson for civic leaders and politicians political leaders who keep believing Sacramento is in his words
06:19the Mecca where people in business should be based up and lining to do business here then he flat out
06:24said
06:24that is not true anymore hmm here's the part the political class doesn't want you to hear California's top
06:31corporate tax rate is 8.84 percent its top personal income tax rate is 13.3 highest in the nation
06:38the tax
06:38foundation puts California near the bottom of its state business tax climate index every single year
06:44citing and i'm quoting them the high tax rates with an uncompetitive tax structure a chief executive
06:51magazine has ranked California dead last on its best and worst states for business list for 14 years in a
06:58row
06:58not three not seven 14 because blue diamond isn't the only one leaving but to understand what this actually
07:07costs step in the shoes of a Sacramento plant worker for a minute who's been on the blue diamond line
07:13for 30 years packed almonds since the 90s your kid went to Sacramento schools your mortgage is built
07:19around this paycheck your health care is built around this paycheck the plants been in your neighborhood
07:26longer than you have and now you've got an 18 month window before the line you work goes dark some
07:34of
07:35you will get relocation offers to turlock or salida 100 miles south two hours of new commute or a sold
07:43house and a move family some of you will get severance most of you will get a layoff notice and
07:48a placement
07:49pamphlet and multiply that across 600 families in Sacramento then multiply that across growers
07:57steven gordon owns cadena farm is esperado out his grandfather opened that farm in 1971 54 years of
08:06selling almonds to blue diamond three full generations when news broke he told reporters the connection
08:12between the buyer and the farmer is going to change dramatically with everything moving down to central
08:20valley his exact words suddenly the backdrop has changed the landscape has changed around us and here's
08:26the irony of it the growers the workers the buyers didn't make California unaffordable they just
08:32live with what the political class built oh and the political class built a tax and regulatory
08:39environment so expensive that the world's largest almond cooperative just decided its founding plant
08:45isn't worth keeping open here's what nobody in Sacramento wants you to see even with blue diamond
08:50closure even with chevron leaving for houston after 145 years even with tesla oracle and charles
08:57schwab and hewlett-packard hp enterprise and palantir and toyota all relocating even with all that
09:05california's non-partisan legislative analyst office that lao just published its outlook fiscal year
09:12from 2026 to 27 the number is 18 billion that's the deficit california is facing next year 18 billion and
09:20the
09:20part that makes this number worse state revenue is currently running approximately nine billion
09:25dollars ahead what budget anticipated they're taking in more money than expected and the structural
09:30deficit is still 18 billion see the math doesn't work the state general fund is roughly 17 percent
09:37dependent on personal income tax most of it from high earners the same high earners who are now
09:44packing up for texas packing up for tennessee and florida the 2025 legislative session ended with
09:51lawmakers having proposed more than 16 billion dollars in additional taxes and fees according to the
09:57california taxpayers association and it gets worse the state has been defaulting on the federal
10:02unemployment loan it took during covet roughly 20 billion dollars still outstanding the federal government
10:09recovers it by automatically raising employer employer payroll taxes additional 126 per employee in 2025
10:18alone climbing toward over 400 per worker by the end of the decade every business operating in california
10:26is paying that surcharge including the ones still deciding whether they want to stay and so the loop
10:33closes the state spends like a state with no deficit the deficit grows the legislature has proposed new
10:40taxes to cover it the businesses leave the tax base shrinks the deficit grows it's not a policy guys
10:47it's a death spiral so what are people in charge doing about it that's really the infuriating part
10:52governor gavin newsom has spent the last two years publicly denying that california is losing
10:57residents and businesses to other states even his u-haul january's report short more californians rented
11:04one-way trucks to leave the state in 2024 than the residents of any other state his office talks up
11:10the world's fourth largest economy the reality according to the public policy institute of california
11:16is that three percent of all california businesses relocated out of state in 2025 alone and sacramento's
11:23his own response to blue diamond's departure tells you everything mayor kevin mccarty's official
11:30statement thanked blue diamond for his own words 115 years of partnership then pivoted in the same
11:37paragraph to looking forward to again his words the next chapter for the 53 acre site a century and
11:44a half of partnership framed in one sentence as a real estate opportunity not a wake-up call about why
11:50115 year old california co-op can't afford to run a plant in california's capital anymore a redevelopment
11:57pitch and here's the part where both sides fail blue diamond's leadership chose efficiency
12:02over loyalty to the city that built the brand california's leadership chose denial
12:07over structural reform that might have kept them 600 sacramento families are caught in the middle and
12:13this just isn't about california new york illinois new jersey massachusetts those four states
12:20plus california have seen a combined net out migration of roughly 3.7 million residents
12:26since 2022 according to the census data cited by the heritage foundation guys same playbook same result
12:33so let's bring it full circle we start with 11 california almond farmers in 1910 banding together
12:40in sacramento because the middlemen were eating their pay they built a packing house at the rail yards
12:48they put a blue diamond on every box over the next 115 years they grow that single sacramento
12:55operation into the largest almond cooperative on earth 3 000 farming families 1800 employees
13:04almond milk on the shelves five countries 1.59 billion annual revenue half the u.s snack almond market then
13:12in june 2025 the man bought into lead them a ceo with a global consolidation resume walks in sacramento
13:19plant and tells 600 families it's over because the city that grew his co-op has become too expensive
13:26for the co-op to operate that's the bottom line this isn't about one ceo making a balance sheet decision
13:32this is about a state where the math has gotten so broken even its homegrown agricultural icons cannot afford
13:40to run a plant in the state capitol whether you're in california watching from anywhere else
13:45this affects you because when companies leave jobs disappear the tax base shrinks and the families
13:52who built the place pay the price so i want to hear from you in the comments below do you
13:59think california
13:59can reverse this or is this exodus permanent if this opened your eyes hit that like button hit that
14:07subscribe button for more deep dives into stories that actually affect your wallet and your future
14:11hit the notification bell stay informed stay engaged and remember 11 farmers built a global powerhouse
14:19from sacramento packing house 2026 the same state that grew them is the reason they're closing it
Comments