"Effective Altruism," as widely espoused these days in neoliberal / libertarian ECON circles, is a self-serving perversion of the utilitarian moral philosophy that first gained global traction via the works of Australian activist academic Peter Singer.
The original elevator speech went something like this: "in a world where needs will inexorably exceed available resources, we have a moral imperative to direct our charitable resources to the "highest & best" / "most effective" use.
Bang for the buck, essentially.
The roughly 10 Grand I've plowed into my veterinary frequent-flier Ranger, my 2018 California 90 lb Chocolate Lab mix stray rescue, is ostensibly "morally" wanting in such regard, given the massive intractable human miseries around the globe.
Whatever. Ranger stays. As do our monthly contributions to the MD Food Bank and a number of other worthy causes. I have no need of self-appointed moral critics evaluating the extent and "effectiveness" of my relative beneficence.
In light of my Master's in applied ethics ("Ethics & Policy Studies"), I found it intriguing, and thought I ought give EA a close, charitable read. Alluring in gauzy, vague principle, nonetheless it raised more questions than answers.
“EFFECTIVE ALTRUISM" CIRCA 2022
Nowadays it's fashionable in rapacious digerati circles to wield "effective altruism" as impenetrable Virtue Signaling armor—akin in a way to "Prosperity Gospel."
"Think about how much good you could do if you were a young, adroit, fearless crypto billionaire."
Which brings us back around tot this shitstorm.
More to come. This kid's parents are both Stanford Law professors (Joseph & Barbara). The 28 yr old Caroline Ellison he chose to be CEO of his wholly-owned Alameda Research (uh, hel-LO?) is the daughter of two vaunted MIT Economics professors (Glenn & Sara).
Prestige institutions, the Best-and-Brightest offspring. Depressing.
For now, read this.
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A response at Naked Capitalism. Well worth your time.
MORE NEWS
Key Institutional Crypto Player, Genesis, on Verge of Failure; Possibility of “Apocalyptic” Bitcoin Liquidation
Posted on November 23, 2022 by Yves Smith
…The unwind of FTX is certain to dominate business press, pundit, and politician attention due to how its uber connected and very recently idolized top brass have been revealed as drug-addled business incompetents who neverless seem to have done a very good job at disappearing a lot of the moolah, presumable for their personal use. The level of media noise and coming prosecutions (both the Southern District of New York and Bahama are reportedly ginning up filing) and the failure of supposedly sophisticated player to find anything amiss will presumably chill interest in crypto, particularly if other firms fall over due to FTX contagion…
FROM THE NEW YORKER
Sam Bankman-Fried and the Long Road to Taking Crypto MainstreamAT THE ATLANTIC
The disgraced founder of FTX played on the vanities of the establishment, reassuring V.C. firms and the media that smart-guy insiders like him could save the world.
In the beginning, there was Satoshi Nakamoto, the pseudonymous programmer who created Bitcoin and promised an entire new way of thinking about money—and, by extension, power and politics. But, after it became clear that Nakamoto wasn’t going to appear on some mount and pass his tablets down to the masses, the cryptocurrency world began to yearn for a proper evangelist. The people who have tried to fill that role have mostly been self-appointed, such as Roger Ver, the loud and impassioned former C.E.O. of Bitcoin.com, and the man behind Bitcoin Cash; Vitalik Buterin, the enigmatic and perpetually bemused creator of Ethereum; and the Winklevoss twins, the Facebook-involved duo immortalized in the film “The Social Network,” who started the Gemini exchange and pushed for years for a Bitcoin exchange-traded fund, which they argued would spread the gospel to every brokerage account in America. The reason that the crypto community felt like it needed someone in this role was relatively simple: Internet money requires a leap of faith in a new society. What that particular new world might look like has always been a bit vague, with a few nods to the Austrian School of Economics, or seamless economies that are run entirely on smart contracts. But the pitch to you, the consumer, has always remained the same: In the crypto future, whatever it is, you will be incredibly rich…
Sam Bankman-Fried, the disgraced founder of the cryptocurrency exchange FTX—which went bankrupt this month in one of the most spectacular financial implosions since the Bernie Madoff scandal—was the latest and the most effective crypto messiah, precisely because he did not really seem to take crypto all that seriously. His creation myth has it that, after a very credentialled early life in which he, the son of two Stanford law professors, excelled in his private school, went to M.I.T., and then went off to go work on Wall Street, Bankman-Fried became enamored with effective altruism (E.A.), a somewhat scattered philanthropic philosophy that tries to optimize the good that can be done through charity, but whose members also spend an unusual amount of time worrying about the threats of sentient artificial intelligence. Bankman-Fried decided that he would try to make as much money as he could, in order to give it away in an E.A.-optimized way. He claims that he didn’t know what a blockchain was when he got started in crypto, which, he also said, was a field made up of projects that were mostly “bullshit.” But it also was a means to an end. The world would be better if he, the smartest guy in the room, had more money to distribute, and crypto was the fastest way to get rich. All it took, it turns out, was a series of massively leveraged bets, some hilariously creative bookkeeping, and an abiding belief that the trust in his credentials and in his philanthropic vision would keep people from even peeking under the hood…
For anyone checking out “the team,” the entire mix of Bankman-Fried’s appeal can be found here: the litany of prestigious universities, the association with serious thinkers, and the belief in a philosophy that doesn’t set off any ideological alarms. Among the people who wanted to turn Bankman-Fried into an A.T.M., the details added up to the story of a new type of smart guy who believed all the same things they did about crypto, and who was going to change the world.
If that narrative sounds familiar, it’s because it’s become the standard bildungsroman in journalism covering business, tech, and, in some ways, sports. It’s how many journalists talked about Mark Zuckerberg and Paul DePodesta, the Harvard graduate who convinced Billy Beane, the general manager of the Oakland A’s to build his team around analytics and “Moneyball.” In these stories, some young person who went to Harvard is always outsmarting the dumb establishment, the members of which all went to Harvard, too. The addendum is that the world will somehow be a better place if they win…
My Crypto ConfessionARE YOU SHITTING ME?
Sam Bankman-Fried was a member of two cults: one I have criticized, and one I belong to.
By Derek Thompson
Sam Bankman-Fried, the disgraced founder of the trading platform FTX, was a member of two cults. Or, more precisely, he was a figurehead of two movements that outsiders considered cultish. One of these movements I have criticized relentlessly. The other I belong to.
The first is the cult of crypto. I’ve made little secret of the fact that, although I think crypto is anthropologically fascinating, its substance, so far, is almost completely lacking. The blockchain and its related innovations are sometimes described as extraordinary technology in search of an ordinary use case. They are also a glossary in search of a spine—pages worth of lingo (gm, ngmi, maxis, DeFi) that are, as of now, unglued from any stable vision of the future besides the bet that certain asset values will go up. To reinvent the casino and tell yourself that, next up, you’ll reinvent the world, requires either the mind of a time-traveling genius or the faith of a simple zealot…
Sam and Caroline, Titans of DigiFi.
I have every confidence that there is much more skeevy stuff to come.
AGAIN: Old School here doesn’t know much about crypto etc per se but my profitable 2000-2005 tenure in subprime risk management left me with a material thought or two. Technologies may change, but the lure of the grift does not.
UPDATE: AS REPORTED BY DIGBY
“Cryptocurrency is a giant scam, although a complicated scam . . . ” So begins Stephen Diehl’s diatribe against the crypto industry. When he published it in June, Bitcoin and other crypto assets were trembling. Since then, the collapse of FTX, the second-largest crypto exchange, has created a potentially existential crisis. Billions of dollars of customer assets seem to have been incinerated, along with FTX founder Sam Bankman-Fried’s status as an altruistic visionary. Is crypto all just a mirage?
Like Bankman-Fried, Diehl is a thirtysomething American with a nerdy manner and unbrushed hair. But while Bankman-Fried urged US lawmakers to carve favourable new regulations for crypto, Diehl pulled the other end of the rope. He lobbied for crypto to be regulated like other assets. In June he co-ordinated a letter of 1,500 technologists to senior members of the US Congress, urging them to look past “the hype and bluster of the crypto industry” and understand its “inherent flaws”.
Diehl has the grasp of programming and economics to question crypto from first principles. He has tried to sell blockchain technology — the distributed databases on which crypto is built — and believes that he could have ridden the crypto wave: “Anybody who looks like a nerd like me can probably go to the Valley and raise $50mn from some very credulous [venture capitalists] to pump a token and make a life-changing amount of money.” Instead he stood on the sidelines, blogging about crypto’s failings. That won him a following — but also harassment, including death threats. “The past three years have been hell,” he says, naturally shy. “It’s not easy being a crypto sceptic.”
Diehl’s book, Popping the Crypto Bubble, traces Bitcoin’s emergence during the global financial crisis to the post-2016 crypto gold rush, which he refers to as the “Grifter Era”. He argues that crypto is slow (it relies on broadcasting transactions across decentralised networks) and unreliable (individuals are responsible for securing their assets; when they lose passwords or die, there is much less recourse than with, say, a bank). It cannot be both a great investment, which goes up and up, and a viable currency, which offers stable value. He argues that crypto assets’ price is based largely on there being an even greater fool who believes the hype.
“After 14 years, it is still a solution in search of a problem. It’s not building a new financial system. It’s not building a new internet. It’s not an asset uncorrelated with the market. It’s not a hedge against inflation. It is a vehicle for pure, naked speculation detached from anything in the economy. It’s a casino that’s wrapped in all of these lies. When you tear back those lies, what’s left looks like a net negative for the world.” You may not be interested in crypto, but you should be. “It reveals a lot of our dark tendencies,” Diehl says. “And it’s a mirror for a lot of the political struggle in society.” ...
UPDATE: bought the book. An interesting read thus far. Squares with my broad historical knowledge of pre-crypto economic bubbles and frauds, along with my thus far relatively shallow (albeit accruing) education on this new finance technology.
UPDATE2: I'm about 80% through the book. Hugely informative and enjoyable read, highly recommended. This crypto crap has gotta be stopped. It's dangerous. UPDATE3: Finished it. Excellent.
Are we havin' fun yet?
Crypto: Everyone Was Just That Stupid
$2.1 trillion.
That’s a rough approximation of the total value destruction across the cryptocurrency space from the peak seen in early November 2021 through Tuesday morning, when Bitcoin sat at a two-year low, and endorsement payments to Tom Brady from FTX were being scrutinized by Texas regulators.
Who could’ve known, just 12 months ago, that things would turn out this way for crypto? After all, the private money business sounded even more compelling this go-around than it has in the past.
I’m being sarcastic, of course. The private money business never works, and this time most assuredly wasn’t “different.”
In the wake of the FTX fiasco, much of the breathless crypto coverage emanating from the financial media (mainstream, alternative and otherwise), seems to intentionally avoid addressing the elephant in the room. If that’s the case, it’s understandable. Because to address it would be to concede that nearly everyone — from large media conglomerates to the most respected venture capitalists on the planet to storied hedge funds — was duped into believing that all it took to make the private money business viable was a single innovation.
That’s plainly absurd. For one thing, some experts offer trenchant arguments against the idea that blockchain constitutes a “technology” at all, if technology is supposed to be synonymous with true innovation. Even if it is an innovation, many skeptics argue it’s not an especially useful one. In the interest of brevity, I won’t walk through those arguments, but you can certainly do so yourself if you have Google and half an hour to spare.
Beyond that, though, the notion of private money at scale, and, more to the point, the notion of private money at scale as an investable proposition, is stupid. Not “misguided,” not “misplaced” and not any other more generous adjective either. Just plain old stupid…
"ALTRUISM," MY ASS
FTX Group corporate funds were used to purchase real-estate properties in the Bahamas, where the company had its headquarters, for employees and advisers. Reuters has reported that FTX, Bankman-Fried’s parents, and company executives bought a hundred and twenty one million dollars’ worth of real estate, mainly “luxury beachfront homes.” (FTX, Bankman-Fried, and the company executives did not respond to Reuters’ requests for comment. A spokesman for Bankman-Fried’s parents said that they had been trying to return the property to FTX before the bankruptcy proceedings. Separately, James Bromley, the FTX attorney, said on Tuesday that the company spent three hundred million dollars in the Bahamas buying homes and vacation properties for its senior staff.)
This is how Mr. Effective Altruist lived in the Bahamas. Notably absent were any rescued starving orphans from the Sudan or Syrian refugee camps.
In fairness, Mr. Bankman-Fried cannot begin to be His Most Awesomely Effective Philanthrophic Self until he achieves Trillionaire status (a notion he has mused about). Ya gotta do stuff At Scale these days. Hang in there, kiddies.CODA
LOL. The irascible Randian contrarian take on "altruism."
Lordy, Mercy. She's also quoted as exhorting "Individualists of the world—UNITE!"
Whatever. So much fatuous incoherence, so little time... I think I need a drink.
__________ #cryptNOcurrency
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