Meet the Pistachio Barons Who Control California’s Water

“Pistachio Wars” is streaming on pistachiowars.com

I have always considered the pistachio to be a harmless little snack. That was, until I watched Yasha Levine and Rowan Wernham’s “Pistachio Wars,” which shells open a world of greed and corruption that is hanging the state of California out to dry.

At the center of the story is the billionaire-couple Stewart and Lynda Resnick. He is the country’s wealthiest “farmer”; she is the daughter of the producer of the cult favorite “The Blob” and a marketing whiz who could sell coal to Newcastle. Together, they have built up The Wonderful Company into a billion-dollar enterprise and gained control over much of California’s water, a subject that has drawn fresh interest in the wake of this year’s deadly LA fires, during which city fire hydrants ran dry. 

Truthdig spoke with Levine and Wernham last month, just as the wildfires were coming under control, about how they uncovered this real-life “Chinatown,” the cameo played by Iran and the mechanics of agricultural power in the Eureka State. Our conversation has been edited for brevity and clarity.

Truthdig: Yasha, what got you interested in water politics?

Yasha Levine: In 2010, I was reporting on the aftermath of the Wall Street crash in California. There were entire communities in the suburbs that were essentially built to market mortgages to Wall Street. I was specifically focusing on Southern California, and living in this little town called Victorville. People lost their homes after the crash and it was a weird abandoned place. The town was in the middle of the Mojave Desert, and because it expanded so quickly, it ran out of water. That led me to the topic of water and water politics in California. 

TD: What did you see there?

YL: The town was trying to buy water from anywhere that it could. And it bought water from this farmer whose fields are hundreds of miles away, and that water sale was worth like 70-something million dollars. I was intrigued, because how could a town, a government entity, buy water on this private market. And how could a farmer have that much water to just sell to someone? Pulling that thread really opened up a whole world. It showed me where power in California was and who wielded it. Nothing happens in California without water or access to water, because it is a pretty arid environment. Nothing can be built, nothing can be farmed. The people who control water could control life. 

TD: How did it become a film?

Rowan Wernham: I guess that’s probably my doing. I had read Yasha’s long-form article, “A Journey through Oligarch Valley” and a few things struck me. We initially started out making a movie focused on the role of Iran lobbying. But it was hard to get actual documentary material. That world is so opaque that the film was going to feel like a YouTube conspiracy documentary. We realized that there was another side to the story that was more cinematic, a kind of real-life “Chinatown” — with these overlords controlling the water for their own means and pulling a heist where they were going to drain the San Francisco Bay Delta. 

TD: How did you meet your protagonists? The folks who are organizing against these billionaires?

YL: In some places, people were actually dying to tell their story, because these things were going on in their communities, and no one really cared. Take this town called Porterville. The local water supply had been privatized by a small number of local farmers who were using all the water during a dry spell. People had nothing coming out of their taps. There had to be an emergency program to distribute water with trucks. When they saw some two guys with a camera, they approached us.  

TD: Are the L.A. fires related to the Resnicks owning much of the water in California?

YL: It’s connected through development. Nothing happens in California without water, and most places where life happens in California doesn’t have that much water. Where the farming takes place, it doesn’t usually have access to year-round water supply. So, farmers need water to be brought from far away, from the mountains, from these dams that are in the mountains. 

And it’s the same thing with suburban development, real estate development and the building of cities. Los Angeles, for instance, doesn’t have a lot of its own water in order to grow so big and in order to spread as much as it has — taking up the entire valley and the surrounding valley and building all the way up into the hills where the fires took place. That would not be possible without the creation of a massive aqueduct system that taps water in the mountains, hundreds of miles away from Los Angeles. That system of essentially privatized water is what the film is about: rich farmers and developers grabbing hold of water and controlling it to fuel their own wealth and power. The entire suburban civilization of California lives off of the same system. You would not be able to build in the hills like L.A. does, in places where there’s naturally occurring fires every every few seasons or so, without this aqueduct system moving water around for hundreds and hundreds of miles in California. 

These tragic fires are the unfurling consequences of development driven purely by profit.

The farmers privatize the water. That’s why L.A. is not getting it. That’s why L.A. can’t fight the fires. That’s why the fire hydrants are going dry. It’s a structural issue, and I think it’s scary, because it’s not like you can fix it by just telling these billionaires to let go of the water. The system is so entrenched. It underlies California so deeply that it’s almost impossible to change politically.

TD: When you say “farmers,” you mean billionaires who own these farming conglomerates, right?

YL: In California, there are very few small farmers. In terms of just acreage and market domination, they are a footnote. Most of the farms in California are dominated by giant corporations, usually privately held corporations owned by families. And some of these families are like an aristocracy. Their net worth is in the billions.

TD: So why single out the Resnicks?

RW: They are one of the biggest and most powerful out there. It is an unlikely story that these people are even farmers to begin with. They live in Beverly Hills. They’ve got a crazy backstory, a Hollywood brat whose father produces “The Blob.” And this guy who maybe came from a New Jersey mob-adjacent background. They’ve generated all this crazy marketing to boost up their products. No one used to advertise clementine oranges and pistachios. They added brands to foods that are just staples and turned them into commodities. They also have this public persona where they’re philanthropists. Unlike a lot of other farmers, they’ve stuck their neck out. 

TD: Then there’s the pistachio at the center of it all. You’d think it’s a harmless little snack.

RW: That is something very unique about the pistachio story, because it comes out of lobbying and sanctions against Iran. There’s the unusual geopolitics side of it and because this company has created a market through marketing, and there’s a monopoly on it. It’s only profitable because the main competitor in the global market [Iran] is locked out.

YL: They are actually pretty significant as far as the politics of California water goes. They helped negotiate the deregulation of California water laws. It’s called the Monterey Agreements, which privatized this underground water bank. It allows the Resnicks and a handful of other farmers to treat water like money. Like, water goes in the bank and it becomes theirs, and they can do with it as they want. They can use it to crush competition. They can sell it to cities that are in the middle of a drought. That makes them significant on a political level. 

TD: It’s fascinating how they present as these do-gooders saving the world from evil.

YL: Because the Resnicks are equal partners — you don’t really see that very often — there’s some sweetness to the evil shit that they do. And their philanthropy plays a major role in helping whitewash the nefarious side of their business operations. The Resnicks are one of the most generous benefactors of culture and the arts in California. They bring in a lot of different strands together and are perfect vehicles to tell the story of water in California, a topic that is not very sexy. It’s all about contracts, about legal stuff. When I first started writing about them 15 years ago, they stood out immediately; they wanted to be the central characters of the story. They really wanted their name on everything.

TD: Let’s walk back a little. How can something like water be controlled and sold?

YL: This is where you start getting into the boring details of water policy and water law. Ownership of water, control of water is a really big thing in western and southwestern states of America, primarily because they’re semi-arid, or sometimes totally arid. And whoever has rights to a river, whoever settled or bought land by a river, they determine how much water they can take, and you can take. Water rights and property rights are intertwined. On a simple level, you can ask how someone can own oil that has been accumulating underground for millions of years. It’s similar.

RW: If you look at the state constitution, they say that the water is a public resource and it’s not privatized. But because the way that the water is allocated, it can be controlled privately. If you control all the land in a certain water district, you basically have political control of the water. The system got more marketized in the ’90s when the Resnicks put in the Monterey Agreements. Now you can sell the rights to water and do bizarre things like paper water trading.

TD: And this problem isn’t as simple as Democrats vs. Republicans, right?

YL: The Resnicks are a perfect example of why the two-party system sits on top of a unified system. It doesn’t really matter that much who’s in power. The Resnicks are liberals and a lot of their political donations go to the Democratic Party and they’re backers of Gavin Newsom [California’s Democratic governor]. They also fund Republican politicians who represent the congressional districts where a lot of their agricultural land is. Those Republican politicians have the same politics as the Resnicks. As far as resource extraction goes, and as far as the deprivations of these corporations and their destruction of the environment go, I don’t think there’s much of a difference in terms of who the party in power is. 

TD: Yasha, in your decades of reporting, have things changed depending on governments?

YL: When I first started writing about the Resnicks and water privatization and water politics in California, Arnold Schwarzenegger was the governor of California. You could basically swap out Gavin’s name and put Arnold’s name in there, and they’d sound exactly the same in terms of their policy, in terms of the projects that they supported in terms of how they framed issues and in terms of just always fully supporting what the farmers wanted. And the farmers wanted more water. They didn’t care that an endangered species of fish would go extinct because of it. The rhetoric is the same, no matter what party it is. 

TD: Did you ever hear back from the Resnicks? They’ve been in the news lately.

RW: During the production, we heard that they were asking about the film in indirect ways, but they’ve never responded to any requests we made for an interview or contacted us directly. We’re kind of assuming that their policy is to sort of sit on it and just hope it doesn’t blow up and add fuel to the fire, so to speak. 

TD: What do you want this film to do?

YL: The documentary is an extension of my journalism. And for me, doing journalism means clarifying the world for people in a way that helps them understand the world and their rights. People’s understanding of water politics is so limited so for us, the objective was to just try to show people that this world existed. It exists underneath you, parallel to you. The first stage is ensuring people are really aware of the issue, and I guess you could talk about solutions. But we’re not there yet. 

The problem is so deep, it’s so structural that you essentially can’t really fix it without extremely broad political movement. You have to overthrow the powers that control California, and these are entrenched powers that won’t let go very easily. 

We want people to think about how water is used. It’s ridiculous that so much water gets used for pistachios, these nuts that no one really even asked for. It’s demand driven by marketing. 

TD: Do we just stop eating California pistachios?

RW: I think it’s an overconsumption problem. People probably could still have these things, but we just have too many, and part of that is pushed by marketing. Everyone can see the problems with our overarching system and our overconsumption, overdevelopment, and nobody really has a political solution because the powers are entrenched. I feel skeptical about the political power of raising awareness. But something Yasha told me when we started this film stuck with me. It was this idea that people like the Resnicks are like giants with all this money and power and political power, and journalists can buzz around them like insects and irritate them. Being enough of an irritation to these people is something in itself. And we start the film by buzzing around outside their gates. 

TD: What change do you want the film to bring?

YL: The documentary industry oversells the promise of change through information. We also need to have political organization and political movements. We’re at a time in America where people have no political power, and it’s very difficult to organize, even around simple issues. We’re very conscious of this. I don’t think we want to give people this idea that just watching this movie will change the world. At the same time, this film shows the dark side of California, and that is a story worth telling.