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Press: The perils of reducing morality to a spreadsheet

18 November 2022

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DURING the past fortnight, Sam Bankman-Fried has mislaid about $34 billion, most of it belonging to other people. It is the latest and loudest collapse in the cryptocurrency business; but what makes it interesting is that, until the money disappeared, Mr Bankman-Fried was regarded as a moral exemplar, and not only by himself. As recently as September, Sequoia Capital, a well-regarded Silicon Valley venture capital firm, ran a profile of him which opened with the news that he “lives his life by a calculus of altruistic impact”.

It opens with the story of the hero’s quest: SBF, as he is known, had been a harmless physics major at MIT, when he was recruited as a trader by an elite Wall Street firm. By the time he was 25, he had made his first billion by “collapsing the kimchi premium”, or exploiting a marginal difference between the price of bitcoin as traded in Korea and in the rest of the world.

“SBF has amassed more wealth in a shorter period of time than anyone else, ever,” the Sequoia plug continues. “The 2022 Forbes Billionaires List pegs SBF’s net worth at $24bn. He’s now 30 years old.”

And all this was done for altruistic reasons. Even before he interned on Wall Street, SBF had met the philosopher William MacAskill in a coffee shop in Cambridge and been granted an epiphany. “Over lunch at the Au Bon Pain outside Harvard Square, MacAskill laid out the principles of effective altruism (EA). The math, MacAskill argued, means that if one’s goal is to optimize one’s life for doing good, often most good can be done by choosing to make the most money possible — in order to give it all away. ‘Earn to give,’ urged MacAskill.

“MacAskill couldn’t have hoped for a better recruit . . . right there, between a bright yellow sunshade and the crumb-strewn red-brick floor, SBF’s purpose in life was set: He was going to get filthy rich, for charity’s sake. All the rest was merely execution risk.”

And that is how our hero ended up in a penthouse in the Bahamas, living with nine of his friends and employees in a “polycule” (a polycule is a molecule of polygamist atoms, bonding together as altruistically — and, of course, efficiently — as possible). While it lasted, SBF’s racket was incredibly respectable and influential. Bill Clinton and Tony Blair turned up for a conference that SBF hosted in his Bahamian lair this autumn.

The Sequoia Capital story I’m quoting from has disappeared from the firm’s website almost as completely as the $34 billion that SBF’s empire was supposed to be worth. There were about 130 linked companies in his organisation, all of them ultimately dependent on a cryptocurrency of SBF’s invention.

When one of his rivals drove down the price of this crypto — which had, of course, no intrinsic worth at all, and nothing backing it but the confidence of its backers — the whole pyramid collapsed in a week. There is nothing left now. Even SBF himself, currently on the run, may be worth no more than one billion dollars or so. Anyone who believed in him has nothing now to show for their investment.


SET against this, the £6.6 million that Christ Church, Oxford, spent in its attempts to get rid of Dr Martyn Percy looks like the kind of oversight that anyone could make. It hardly counts as altruism at all.

The really astonishing thing about effective altruism is not that it asks how best a charity can spend its money. Outside of Christ Church, most charities do ask themselves how their spending will improve the world. It is the belief that really effective altruists should spend their money in the way that most benefits people who don’t exist and may never do so — the perfectly imaginary billions of future lives. This concern for the future of (non-existent) humanity is coupled with a firm belief in the rightness of abortion, because “the loss of an actual child’s life — a life in which a great deal of parental and societal resources have been invested — is much more consequential than the loss of a potential life, in utero.”

The most morally grown-up piece on the whole fiasco came from Stephen Bush in the Financial Times, who took seriously the idea that the effective altruists were trying to do good, but took them to task for supposing that they could — and must — reduce moral choice to something that would fit on a spreadsheet. “A little more focus on what we know works, rather than what we think might, is almost always a good thing,” Bush wrote.


THE other ethical pole is not to consider the consequences at all, but just to follow the commandments. James Runcie had a really moving excerpt from his book about his late wife in the Telegraph Magazine, in which he mentioned that, when the couple first fell in love in the early 1980s, “my father was Archbishop of Canterbury and the idea of my marrying a woman 11 years older, a divorced single parent, would have sent my parents into a spin.” I’m sure it would have sent the right-wing press into a spin, but his parents?

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