After growing up in middle-class affluence in Silicon Valley as the child of two Stanford Law School professors, as a super-smart kid who entered MIT to study physics, Sam Bankman-Fried decided in those teenage years. he wants to save the world in the worst way.
That’s what he wanted.
Young, and all idealistic, Bankman-Fried was lucky to attend a college where he studied and came to embrace the idea called “effective altruism” — that rising geniuses like him would not improve humanity through ordinary hard work like managing peasants. No, they need to use their brain power and some mathematical calculations to maximize the amount of money they make in free modern capitalism, and then give millions or maybe billions of dollars to the social causes they are most interested in.
“If what you’re going to do is contribute, you should make as much as you can and give as much as you can,” said Bankman-Gorengwhose mission is his calling card to the point where there are podcast episodes called “Sam Bankman-Fried Wants to Save the World.”
Bankman-Fried became the best student of altruism, because he went to Wall Street and turned out to be very good as part of the “make as much as you can” of all this. He used trading tricks in the new frontier of cryptocurrency to get rich and – still in his 20s – launched a small empire based on his crypto exchange, FTX. But while her net worth grew to an estimated $16 billion at her peak, Bankman-Fried hasn’t quite gotten to the “give as much as you can” part — perhaps several hundred million dollars — before. His Jenga empire tumbled down.
It turns out you can’t be an effective altruist if your money disappears, which started happening this spring in line with the worldwide cryptocurrency crash. It took several months or years of investigators to solve the mess in FTX, but by his own admission Bankman-Fried was involved in. risky and unethical practices to support one arm of his crypto empire – including tapping the accounts of FTX customers. Those duped investors may have lost as much as $8 billion.
Now 30 years old, effective altruism is not only ineffective in saving planet Earth. He made it worse, for reeling investors and possibly for all of us as FTX losses in the economy. Sure to be the subject of podcasts and biopics for the rest of our lives, the rise and fall of Sam Bankman-Fried is indeed a remarkable story, but it’s just the latest twist in what could be the story of the 21st century — and the ills of late-stage capitalism.
Messianic billionaires – and we all know who they are… Elon Musk, Jeff Bezos, Howard Schultz, Bill Gates, and even MBS in Saudi Arabia – have emerged as the ultimate winners in a winner-take-all economy. Income inequality exaggerated to a level beyond the notorious Gilded Age. And they are now spending many of those billions on what they are think make the world better – yet often marred by the same sociopathy that made them rich in the first place.
Indeed, the Bankman-Fried saga does not seem to have received as much attention as it usually does because journalists and some self-anointed thought leaders are busy obsessing over a different billionaire, Musk, and his $44 billion project – apparently in a personal and social obsession. media site Twitter that he now owns – the owner of the blue bird take a breath in a matter of days.
The erratic, mercurial leadership of Musk – electric car and space mogul still the richest person in the world, Although his Twitter travails have knocked his net worth down to $189 billion – he has brought the site that seemed to be able to survive OK before his purchase to the brink of the abyss. The problem around the spike in unmoderated hate speech or strange changes in verification had Twitter users, its distraught employees and confused advertisers racing each other to get out — and that was before Musk’s reprehensible decision on Saturday night to revoke Donald Trump’s lifetime ban on using Twitter to promote his violent coup attempt on January 6, 2021.
Accordingly, it was Trump – who used his own wealth as a maybe-maybe-not-a-billionaire in 2016 for perhaps the worst vanity project of them all, electing himself the president of America – who set the spell of these billionaire boys’ clubs. (and it was almost all boys) when he stated, “I can fix it myself.”
Indeed, the richest people in the world today—for all their differences in style or cause—seem to share a very similar philosophy. It goes something like this: “Let’s maintain this status quo where I can run a business by maximizing my own wealth – including historically low taxes and paying my workers – and I swear I’ll use that wealth to better the world. The catch? I’m alone decide what that better world is, and how to get there.
Just last week, Amazon founder Jeff Bezos – who was once the richest man in the world, before his messy divorce – set the blueprint for this model when he promised to give most of his $124 billion net worth during his lifetime. In an interview with CNN, Bezos admitted that this is easier said than done, that “there are a number of ways, I think, you can do things that are ineffective.”
Here’s what’s scary about this: It would really be easy for Jeff Bezos to be an “effective altruist” – to use his power as the founder of Amazon to make life better for the 1.1 million people who work there, not only with a living wage but. by spending to make the workplace safe and comfortable for those who are now explaining the state of hell. In contrast, Amazon Bezos spends untold millions in the fight to protect those workers from organizing.
Imagine: He could make the world a better place by giving away his wealth before it through his purse, instead of after. But that also means sacrificing what’s important to Bezos or Musk: total control.
The deal of how these billionaires think we can achieve a better world is very similar – a society where individualistic forms of free market libertarianism and technology fix everything, and trade unions and other forms of community organization. go away. That’s why many billionaires like Microsoft’s Gates are focused on giving money to the failing, teachers-unions. charter school project, conveniently forgetting the role that thriving public schools once played in building an American middle class. That’s why Starbucks’ Schultz out of retirement lead an anti-labor crusade against organizing baristas, because their work is shattering the dangerous myth of the modern, socially conscious corporation.
It should not be like this.
Of course, the battle cry at a time like this is usually, “Tax the rich!” – and, yes, we should be right do that. Historically low tax rates on the wealthy – created by politicians who run their campaigns on the wealth of these billions – must be repealed. And given our ridiculous levels of wealth inequality, we need to explore additional steps like wealth tax. (Sen. Elizabeth Warren proposed this as a way to pay for free public universities, which is a better system than billionaires writing giant checks to their favorite elite schools.)
But the fact that our billionaires spend so much of their energy in the union fight should tell a: What they fear even more than a high marginal tax rate is the assumption that we – the 99 Percent folks everyday – will work together, collectively. for our own good instead of begging for crumbs of their largess. The best and easiest way to reduce the grip of Musk or Bezos is strengthen organized labor.
I would argue more broadly that we need to rethink what the common good is and should be supported – financially and morally – by society, rather than by spinning the wheels of billionaire philanthropy. Social media sites like Twitter – which, for all its flaws, also give voice to social movements as diverse as the Arab Spring, Black Lives Matter and #MeToo – there should be more as a semi-public utility than as an entity that a man with a spare $ 44 billion can only light on fire. Ditto for things like community media, and higher education
We should never leave everything from our neighborhood schools to our favorite websites in the clutches of these madmen posing as altruistic visionaries. And sorry, Sam and Elon, but the path to a better world really isn’t rocket science.
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