SPEAKER_00 0:38

Hello, you're listening to the Philanthropisms Podcast. This is the podcast where we try to put philanthropy in context. With me, your host, Rodri Davis. And this week I thought we'd take a bit a little bit of a look at some things that are going on in the news at the moment around big philanthropy, because it feels like it's been perhaps the uh the newsiest couple of weeks ever in the world of big philanthropy. So lots of the issues that I spend a lot of time thinking about and talking about on this podcast have very much been at the forefront of kind of comment and debate in the news as a result of a couple of stories that we're going to talk about. The main one is particularly the uh spectacular downfall of Sam Bankman-Fried, the uh crypto billionaire uh who founded the FTX Exchange, which has sort of collapsed uh amidst allegations of wide-scale mismanagement and fraud um and the implications of that for philanthropy. And then assuming I don't go on far too long about that, uh, I'm also hoping to talk a little bit about what's been going on with Jeff Bezos of Amazon Fame and also his former wife, Mackenzie Scott, who uh you know I'm uncomfortable calling her his former wife, really. It's been a few years, and she's also a very notable philanthropist in her own right, um, perhaps you know, the most notable and admirable philanthropist uh currently operating at that scale anywhere in the world. So I just wanted to talk a little bit about these stories, what's interesting about them, kind of what to keep an eye out for, what the implications might be for philanthropy as a whole, and some of the sort of specific um things that we should be thinking about in terms of effective altruism, crypto philanthropy, philanthropic funding for journalism, uh the interaction between philanthropy and democracy and all kinds of other stuff. So uh without further ado, let's kind of kick off by thinking about uh Sam Bankman-Fried and FTX and EA. So uh a lot of acronyms here, uh particularly because Sam Bankman-Fried himself is often referred to as SBF, and I will probably lapse into doing that myself uh during this podcast. So the basic background to this story is um Bankman Freed is a young uh crypto billionaire, I think he's in his late twenties now, who has become uh very famous um for the amount of money he's generated in such a short space of time, also for his kind of distinctive um personality and persona, so he very much kind of dresses quite schlubbery um in kind of t-shirts and and shorts, uh attends sort of big meetings in that way. It was reported many, many times in lots of stories about him that often when holding meetings with kind of um very senior investors and others, he would clearly be kind of looking at another computer screen and playing games, particularly uh League of Legends, I think, which at the time was you know kind of written up as one of these slightly breathless wow, isn't you know, isn't this guy kind of kooky and and weird but brilliant? But to be honest, I always found slightly jarring and actually at the time thought, you know, this seems like the behaviour of a sociopath, and and maybe that will prove to be more the assessment uh from from here on in. Um but essentially what what happened over the last few years was that Bankman Fried became very prominent as a philanthropist as well, and not just sort of accidentally, he's been heavily tied to the effective altruism movement from the outset. So, for anyone listening who who doesn't know, um effective altruism is a movement that kind of came out of academic moral philosophy centred on uh the University of Oxford and it's subsequently spread into the world of tech and is sort of very popular among a certain type of billionaire. And it's essentially a kind of hyper-rationalist philosophy which espouses the idea that when it comes to giving, you should not uh seek to rely on your own choice or kind of you know subjective view about what to give to. Instead, you should apply fully objective measures of how to do the most possible good with the resources available to you. And this is kind of often tied into sort of utilitarian reasoning about maximising well-being for the uh the largest number of people. And this has become quite a powerful movement as well as an idea, as we'll we'll discuss in a bit, uh and has many kind of prominent followers. Uh, and Bankman Fried became perhaps one of the most prominent of these because the story always told about him was that as um a uh student while he was at uh MIT, I think, he ended up meeting Will McCaskill, who is um one of a philosopher at Oxford who is one of the most sort of prominent figures within EA and very much its kind of you know thought leaders. And McCaskill uh convinced him of the merits of effective altruism. Um, and Bankman Fried subsequently worked a bit within effective altruist organizations and then spotted an opportunity to get into the crypto field, reportedly on the basis of buying into the effective altruist idea that you the best way you could possibly maximize your good in the world often would be not to go and work in a non-profit or to do something that obviously had a direct social good, but instead to go and earn vast amounts of money that you could then give to effective altruist endorsed causes. And this is the route that Bankman Freed took. Um so he went into the crypto world, founded his exchange FTX, and also a few other organizations, including one called Alameda Research, which will be pertinent to our story, on the basis that his plan was always to make vast amounts of money that could then be given to effective altruism. And it was always written up as though he was kind of peculiarly frugal and still lived well within his means and slept on people's couches and drove drove a Toya to Corolla and all these sorts of things. I think it's subsequently in the fallout from this story become apparent that perhaps he was enjoying uh the lavish lifestyle a bit more than was was being reported a lot at the time. Um, and this has perhaps kind of raised some eyebrows and and uh increased scepticism about whether this origin story of Bankman Fried is perhaps quite as it has been built. But basically, it turns out that the FTX empire was built, if not on a house of cards, then on the basis of kind of pretty wide-scale fraud um or alleged fraud. It's not really the place to go into the detail of that. And to be honest, I can barely get my head around a lot of it. Um, and the fallout of that is sort of going on at the moment. Um, bankruptcy has been declared, and bankruptcy uh specialists have kind of taken over the running of FTX in order to deal with all that. In fact, uh it's the guy who dealt with the similar situation at Enron, which kind of gives you an idea of the sort of precedent we're talking about here. But basically, it seems as though um FTX just didn't have enough money to cover all of the deposits that that it was taking from customers. Um, and that was partly because it was using that money then to pay off debts um of uh some of its associated organizations like Alameda Research, which is very much a kind of big no-no. And the claim from uh Bankman Fried and others around him is that this was, you know, even if they did do this, it was naivety and uh kind of just slightly losing track of how much money they had. Lots of people don't really buy that and actually feel as though there was uh a pretty kind of concerted wide-scale fraud perpetrated, but that is still very much kind of playing out at the moment. It's been a very fast-moving story, um, and you know, there've been some really kind of notable moments in it. One just to flag up, and I'll put a link in the show notes, um, because it has a lot of pertinence for the philanthropy angle on the story, was that uh Bankman Fried gave a rather bizarre kind of late night interview via direct message um with the Vox journalist Kelsey Piper, who is herself involved in the effective altruism movement and has been for many years. And he quite unbelievably candidly answered lots of questions about um what had been going on at FTX, and in particular about his effective altruist beliefs and whether they were genuine, which lots of people sort of were fascinated by and are still trying to kind of interpret to some extent. So that's kind of the the story and where we are at the moment. As I say, we're still kind of in the thick of it, and the fallout is is still being felt in all sorts of different ways. I guess what I want to focus on is what is the implic what are the implications for philanthropy uh in various different ways of this story. Um so if we take, you know, first of all, I think let's just think about the implications for big philanthropy as a whole. Um and I say big philanthropy there advisedly, because I think like a lot of stories, um, what we need to do is be clear that this is about a very specific kind of tiny subset of philanthropy that is at the very, very, very top end of it, and is particularly prominent because the amounts of money are so massive that they do make up a significant proportion of the overall amount of money within philanthropy as a whole. But in terms of extrapolating to ideas and and kind of themes about what is going on in philanthropy, I do think we sometimes have to be a bit careful about assuming that the philanthropy of people like Bankman Fried or Jeff Bezos or Mark Zuckerberg actually reflects the reality of philanthropy among even very wealthy people, but at kind of significantly lower amounts of money. Similarly, there are lots of kind of US-specific angles to this that we should be, again, slightly wary of, just assuming that the same applies in the UK or anywhere else in the world for that matter. That being said, you know, this story really has caught the attention, I think, partly because there's some just really kind of eye-popping uh different aspects to it. It it's at the middle of a Venn diagram that kind of brings together big philanthropy, effects of altruism, cryptocurrency, um, funding for political parties, journalism, and all sorts of things. So I think there's lots of things for people to grip on to. And I think you know, the most basic point is it is really grist to the mill of those who were already pretty sceptical or cynical about big money philanthropy and argue that it's you know just a front for um the very, very wealthy to uh get away with all sorts of bad behaviour and try and kind of buy um the complicity and silence of um the media and the political classes uh and the public. Again, it's difficult in this particular case because it's not entirely clear yet what the lessons we should take from it are and whether Bankman Fried was genuine in his belief in effective altruism, whether it actually was being used the whole time as a convenient front to cover up fraudulent behaviour or something in between. Uh but and I think, as I say, I you know, I kind of caution a a little bit of care about assuming that you can extrapolate from this one example to a conclusion that, oh, C told you, you know, it's all terrible, all philanthropy is awful. But there are those who will take that view. I mean, if you are of the mind of um people like Anna and Girard Aradas, who, you know, kind of prominent philanthropy critics, they will just turn around and say, well, you know, C told you so. And it's kind of difficult to argue with that assessment on the basis of this particular example. But again, I think we need to be careful about um, you know, uh reasoning by induction from, well, here's yet another example of a billionaire uh purported philanthropist doing something bad, therefore uh it's all a sham uh and you know it's terrible and we could should stop the whole thing. I think it's it's too easy to kind of lapse into to that kind of polemic. So I think it's more useful to focus in on what is specific and what are the specific lessons that we can take from from the Bankrom Fried example. Uh and I think on that front there are a few, and I want to kind of split them into three things. So there's what can it, what does it tell us about what might be happening in terms of crypto philanthropy, so the sort of intersection of philanthropy and cryptocurrency. What does it mean uh for the philanthropic funding of journalism and uh politics? And I'm gonna lump those two together just because the point I want to make is sort of broadly similar. And then probably the most substantive is what does it mean for effective altruism uh as a whole? Uh and this is where a lot of the focus of the analysis has been so far, um, and I'm not gonna be any different. So stay tuned and uh we'll kick off with that in just a moment.

SPEAKER_03 13:28

At Meeting of Industrial Leaders in Washington, here's Julius Rosenwald. Most people are of the opinion that because a man has made a fortune, that his opinions on any subject are value. Don't be fooled by believing because a man is rich, it is necessarily rich. There is ample proof to the future.

SPEAKER_00 14:00

Okay, so in terms of breaking this story down a bit, the first thing I want to look at is what impact will this spectacular implosion of uh SBF and FTX uh have on uh crypto philanthropy. So I'm here thinking of crypto philanthropy as philanthropy coming from people who have made lots of money in cryptocurrency, whether that's uh the ownership of or the operation of exchanges that deal with cryptocurrency, and also just the wider usage of cryptocurrency as a means of donation. And again, we'll need to sort of break this down a little bit because I think the potential implications are different for various different interpretations of what we mean by crypto philanthropy. I guess one thing to say is that this story comes at a point where cryptocurrency was already on something of a bit of a downturn. I mean, crypto markets have been significantly down over the last year or so, and I guess questions were already being asked about whether the beginning or the end uh is in sight for crypto uh currency as a whole, uh, and whether it's become something that is just too volatile and too risky, and and we should just kind of do away with the whole idea. I think that had already slightly filtered into a cooling effect in terms of crypto philanthropy. I think there are organizations that are heavily invested in crypto philanthropy and perhaps kind of tapping into uh crypto philanthropy, but I'm I'm not sure it's moved forward uh in the way that lots of people, uh, you know, myself included, a few years ago thought it might and kind of developed into a genuine uh significant trend within the non-profit world. I suppose the thing to say about the FTX story is it does absolutely nothing um to dispel any concerns that crypto is kind of inherently fraudulent and risky. If if you were looking at these uh markets and these currencies and thinking, well, there's something a bit off about them. The fact that there's been such a spectacular um uh kind of uh collapse in one of the biggest cryptocurrency exchanges, and that many individual investors are unfortunately likely to lose significant amounts of money is not going to do anything to kind of reassure you, is it? And I guess in a practical terms, that that contagion may have an actual effect on markets as well. So, you know, as I say, um cryptocurrencies were already in a slightly pareless state, um, it's possible that the fall of FTX will uh lead to something of a domino effect where other exchanges uh and other organizations dealing in crypto will subsequently collapse as well because their own financial viability is questionable. Uh and if that adds to a picture where the value of cryptocurrency gets significantly lower and at the same time the the risk of it, or the the perceived risk, is much higher, that surely makes it a lot less appealing. I mean, I think the reason people have kind of got into this that space at all is because even if the risk and the volatility were high, it seemed as though the rewards at times were enormous as well. So it was maybe a risk worth taking. But if it's high risk and lower return, then you know it doesn't take a financial expert to say that that might be less appealing. And I think that's particularly true from the point of view of non-profits, because I think there are a kind of large class of non-profits that might have been vaguely aware of cryptocurrency and sort of thinking about whether it's something that they wanted to get into, and they may even have started dipping a toe and experimenting. I think where that has happened, and where I've seen it in in the charity world, it seems to me to have been largely driven by individuals within organizations who themselves are kind of knowledgeable and enthusiastic about crypto, and they might be sort of heads of innovation, or it might be somebody within the fundraising team who sees it as a way of kind of driving an adoption of a new potential form of fundraising. I don't think in most cases it's something that's being driven from the top down by kind of management and trustees. And and if anything, they've there has probably been a reasonable amount of work done to convince the management and trustees that this is something worth doing. I think the challenge will be if the the sort of background mood music shifts from I haven't really heard much about cryptocurrency and I don't understand it, but I do know that lots of people seem to be making loads of money in it and oh look, Goldman Sachs and JP Morgan seem to be doing it, so it's probably legitimate, to instead being, I don't know very much about it, but I did read this story the other day about this exchange that seems to have exploded and lots of people are losing money. If you as a senior manager or trustee, you know, that is your background knowledge about crypto, if somebody in in your organization turns up saying, I think we should get into fundraising via Bitcoin or Ether, you're probably likely to require a lot more convincing and have a lot more skepticism. So I suspect it will have quite a significant cooling effect for that reason, if no other. I think in terms of the impact on organisations that are already in crypto philanthropy, it'll depend to an extent on what the nature is of their exposure to crypto. And I think there's a couple of different ways you could be involved in crypto philanthropy at the moment. The first is that you have direct exposure to crypto and you are linked particularly to a sort of significant crypto donor. So this is the most direct parallel to the Bankman-Fried example. So if you have another crypto sugar daddy that is supporting your organization, you as an organization might think, now's the time maybe to do a bit of extra due diligence just to sort of check that that you know their business dealings seem legitimate, and maybe if we can get our heads around them and see whether there's any sort of potential problems. I mean, that's difficult for non-profits, I think, because I think one thing that the the FTX situation has shown is that it's very easy with the benefit of hindsight to say, oh yeah, this business looks like an you know absolute car crash. But there were lots of people, perfectly, you know, well-informed, intelligent people, who were going along with it right up until that endpoint. And so expecting non-profits that might be receiving donations in the form of crypto to be the ones able to kind of see through that is maybe putting uh you know, setting an unfairly high bar. That being said, you know, from from the point of view of the non-profits themselves and the risk to them and their reputations, perhaps you know, they do need to uh shift the default when it comes to crypto. Not necessarily as far as saying, well, all crypto money is tainted money. Um, although I think some people increasingly might argue that. They might say it's not for crypto as a form of money, it's not that you need to think about the specific instance of how it was made. The money itself is ethically compromised and questionable. So we should treat it in the same way as we would donations from sources that we have decided are tainted, like you know, the tobacco industry or arms manufacturers, and just have a kind of blanket rule saying that we won't accept it. And I think quite a few organizations have probably shifted to that way of thinking. I'm not sure all have, and so they might want to take it more on a case-by-case basis. I think for those that are taking direct crypto donations, but not necessarily linked to any individual billionaire or wealthy person, the considerations are slightly different. I mean, you might still be, I think, there more concerned about market impact and volatility and the value of any crypto that you're holding. And you might think, you know, do we want to hold along to that for the long term, or is now the time to kind of cash out even if the market. Markets down and make sure that we at least bank some of that in real fiat money. I don't know, but I I would guess it's sort of the time to be having a bit of a strategic review of that kind of thing. And then I guess the final bit of the crypto philanthropy market, and probably the bit that's in reality the biggest, is where organizations are tapping into crypto donations by uh signing up with a platform that enables this. And there are a handful of these. The the giving block is probably the most well-known and prominent. But essentially, these allow organizations to say, yeah, we'd like to be able to take crypto donations, we'll sign up with this platform, our organization will appear on it. People can give in various forms of crypto. That money will probably then get turned back into normal fiat currency before it ever gets passed on to us. So if you are a charity or a non-profit organization, your actual exposure to cryptocurrency market risk in that situation is pretty minimal. You're not holding any crypto yourself, so the fluctuations in value are not really going to affect you. You presumably aren't as affected by issues about the sources of wealth because the platform is playing some sort of role in intermediating, although there have been examples where that hasn't quite worked out in practice. But you you might think that this is a relatively low-risk way of engaging with cryptocurrency. And I would suspect for organizations that have already got to that point and have signed up with one of these platforms, they might think, yeah, I mean, the market's not looking good and the FTX situation is bad. But unless that has tipped them over into having deeper kind of ethical questions about the very idea of cryptocurrency, they might decide that they'll they'll stick with it for now on the basis that there's still money to be had in that marketplace and there still likely to be people wanting to give donations in that form. So they might as well be in a position to take those donations. Um so I suspect, you know, those organizations are not just going to deregister themselves in the platforms and kind of wash their hands of the whole thing. But you know, it'll be interesting to see over the coming year and years whether we do look back and sort of mark this as the beginning of the end for crypto philanthropy as a meaningful trend, or whether it's just another bump in the road and it rides it out and does become a major source of funding for the sect. I just wanted to say uh something briefly before we go on and talk about effective altruism, which is sort of the bulk of what I wanted to say, about the implications of the Bankman-Fried FTX uh story for the idea of philanthropy as a source of funding for journalism and and to some extent for politics, because Bankman-Fried have become very notable as a big political donor, so giving lots of money to the Democratic Party in particular, and supporting individual candidates for various offices in uh in kind of electoral races in the US, uh, some of whom were kind of effective altruism aligned candidates, and others, uh, I think more cynically, one would think were kind of crypto-friendly candidates. I think a lot of people would say looking back, a lot of that political money was largely focused on trying to influence decisions about the regulation of cryptocurrency that would have been favourable for FTX as a business rather than anything else or part of some big effective altruist grand plan. But it's very heavily sort of tied in with this philanthropic outlook as well. So it does bring the whole question of the legitimacy of big money philanthropists engaging in the democratic process as a means of trying to sort of drive change and have influence back to the forefront and raises all other kind of usual fawny questions about whether this makes big money philanthropy an anti-democratic menace or not. I think perhaps linked to that, but maybe a little bit more interesting in a way, is that Bankman Freed had become a significant uh source of funding for a handful of news outlets, kind of news startups and established media outlets, and was giving money to support these, one one would uh you know assume on the basis of some belief that uh investing in a healthy news ecosystem is in itself a public good. Although, again, the problem is that subsequent to this story blowing up and everyone finding out about what had been going on at FTX, it now looks as though some of those donations were more about trying to curry favourable coverage from um news outlets and to sort of deflect any criticism or digging around into what was going on at the organization. And arguably it's hard to it's hard to determine direct cause and effect, but it's certainly true, as many people have pointed out, that a lot of the coverage of Bankman Freed up to uh the last couple of weeks was pretty uncritical uh in many ways. And most of them were sort of laudatory profile pieces about this amazing young 20-year-old who'd made billions of pounds, and as I say, kind of talking about his effective altruism and the fact he likes to play computer games whilst not looking at people uh during meetings. So there was a definitely a certain amount of kind of breathlessly buying into a mythos and a and a kind of PR image there. Whether Bankman Fried's funding for these outlets was any sort of factor, not so much in him having sort of given money and said, you need to be nice to me, because I think that sort of thing doesn't work. But the question with philanthropic funding of journalism is whether it becomes something that drives self-censorship and kind of self-selecting choices for which stories to cover because people are aware that these sources of funding are available and may want to get future funding from them. So their kind of assessment of which stories are worth following is influenced or coloured by that. And those stories that are likely to annoy uh potential future donors, maybe they get kind of pushed down the list that bit more. Quite a few media outlets, I think, have been sort of having uh a bit of uh self-reflection in in the light of what has gone on in the last few weeks and asking themselves whether this was part of what happened and whether the fact that they were receiving money had any any influence. And I think most of them would very strongly say, you know, we have editorial independence and you know, absolutely not. Well, our sources of funding don't influence us in that way. But as I say, I don't think it's as clear as being direct. I think it influences in a sort of subconscious or semi-conscious way. And I think it is really important in the context of the overall question of whether philanthropy should is a potential future source of funding that can help uh ensure the sustainability of news media, that we we kind of address these questions about the relationship between editorial independence and philanthropic funding. I think the the thing is that actually the philanthropic funding of journalism is a potentially fascinating and really valuable area, um, particularly in the context of concerns about philanthropy and democracy. It's often put forward as one of the potential solutions, or at least part of the solution to addressing those concerns, that the more philanthropy is able to fund independent uh journalism and investigative journalism and public interest journalism, the better that will be for democracy as a whole. And so it's a way in which philanthropy could play a very sort of strongly pro-democratic role, um, strengthening the democratic system. So I think the the danger for this uh Sam Bankman-Fried story uh in terms of philanthropy and journalism is that it kind of breeds a certain amount of skepticism, justifiable skepticism in in many ways, but if that then sort of filters out into wider consciousness in in the form of skepticism about the very idea of philanthropic funding for journalism, that could be potentially quite damaging. So I think that is something that we we need to watch. Okay, let's just take a very quick break and then I'll come back and talk about the impact on effective altruism.

SPEAKER_01 30:37

Genius billionaire playboy philanthropist, genius billionaire, playboy philanthropist, genius billionaire, playboy philanthropist, genius billionaire playboy.

SPEAKER_00 31:09

Okay, so this is the sort of meat of what I wanted to talk about, and I'll try and keep it as as brief as I can. There's quite a lot to say, but so in terms of the impact of um the whole Bankman-Fried FTX story on uh effective altruism, as I've already mentioned, so Bankman-Fried himself was a kind of longtime prominent member of the AA community. Um he'd become a big source of funding for lots of effective altruist and long-termist organizations, particularly. And um I'm sure we've talked about long-termism before on the podcast, but this is uh a sort of separate but related movement that that um espouses the idea that we should focus far more on considerations about the the far future and kind of potential future lives when we are making decisions about what to do in the present. And it's relatively controversial for various reasons that we might come on to. But certainly, you know, uh a a few weeks or months ago, long-termism was all over the news because Will McCaskill, who is one of the leading lights of effective altruism, has a book out uh called What We Owe the Future, all about long-termism. And this was getting kind of laudatory rave reviews all over the place, and he was going on television talking about it. And it just goes to show, you know, how long a month can be. Sometimes it feels as though the uh the kind of narrative about effective altruism and long-termism has shifted pretty significantly in light of the Bankman-Fried fiasco. And I think the thing about Bankman-Fried and effective altruism is that it's not incidental in any way to the assessment of what happened in terms of the fraudulent behaviour at FTX, or at least that is the perception a lot of people have. It's as we've already said, it's common knowledge, or at least this story is that his belief in effective altruism and particularly the idea of earning to give, so sort of making lots of money and then giving it away, being the most effective way to do good in the world, influenced Bank Munfree to go into crypto in the first place. So it's not incidental from that point of view. But even more than that, lots of critics suggest that uh actually his effective altruist beliefs, and particularly the sort of combination of his long-termism, his belief in earning to give, and his his pretty sort of hardcore consequentialist view. So this is the you know the idea essentially that the end justifies the means. This allowed him to play, to basically justify to himself and to others that what they were doing was fine, potentially up to and including fraudulent behaviour, because you know what they were working towards was a greater good, and therefore all of this stuff could be justified more in the here and now. So I think because it is so inextricably linked to EA, I think this whole situation potentially brings something of an existential crisis for effective altruism. And in in terms of kind of unpicking that a bit, I think it's useful, uh I always think to to try and maybe distinguish between three different ways of thinking about EA, because actually I think we talk about effective altruism as if it is one monolithic thing, but increasingly it's kind of it's a a movement that has lots of different elements and people with different views, but but it's not even just that movement. So there is effective altruism as a movement, so as an actual thing that kind of has leaders and people who speak for it and people who are members and message boards and all that kind of thing. There's effective altruism as an ideology or a set of ideas or a framework that is applied by people, whether they kind of self-identify as members of that movement or not. And then I think there is also EA as uh an academic field, which is where it all started. And I think it's useful to distinguish in some ways between the bit of it that exists out in the wild, uh, as it were, and the bit of it that kind of exists more in graduate philosophy seminars, because they do have a slightly different flavour, and I think the implications of what's happened with FTX are slightly different for both. And so if you think first about effective altruism as an actual movement, well, I guess the most obvious impact of what's happened is there's going to be a pretty significant loss of funding. So the uh major philanthropic vehicle that Bankman Freed had set up, the the FTX Future Fund, all of the sort of senior management uh members of staff resigned pretty quickly after the news came out about um FTX, citing concerns about the business dealings and where the money had come from. What's going to happen to that funding now is still very much up in the air. It looks very likely that lots of money that was kind of committed to various uh effective altruist organizations is not going to be forthcoming. And potentially even worse than that for some organisation, it's been suggested that actually, as part of the bankruptcy proceedings going on with FTX, money that's already been given in the form of grants to certain organizations will be clawed back from them. So there are some quite serious consequences, I think, potentially for certain organizations. I I think probably this get has been written up in some places, particularly as kind of a story about you know charities being affected. I think it's important to say, yes, there are some actual non-profits and charities that are probably recipients of money from effective altruist organizations, but a lot of the money, the vast bulk of it, has gone into organizations that are very much part of that effective altruist ecosystem and are kind of researching and promoting EA ideas, which is, you know, many of them have charitable or non-profit status. So they are charities in that sense. They're not necessarily what your average person would think of as a charity. They're not, you know, existing there to kind of help uh people in need directly. So I think it's kind of worth being aware of of that reality when we're thinking about this story. I think one of the other big questions for EA as a movement is about whether its leaders, so people like Will McCaskill uh and others, um question really is what did they know about what was actually going on with Banklin Fried and FTX? Um and if they didn't know what was going on and they were kind of blind to it, should they have known more? So I guess the question is, were they complicit in any sense, which some people within the movement have suspicions about, or were they just naive? I mean, I would say, you know, the temptation certainly for those leading the movement is to claim the latter because that's less bad. But but neither seems particularly desirable. Um I think to to say that you had no idea um and were just naive about this sort of stuff is a perfectly defensible position. But when you have had such a close relationship as an advisor and as a kind of sounding board for, you know, uh this billionaire who is giving large amounts of money to your movement, and the whole movement is predicated on the idea that the people within it are of a certain level of kind of insight and intellectual brilliance and are uniquely good at thinking about the the long-term future and assessing risks and kind of assigning Bayesian probabilities to things, to turn around and say, Oh, actually, I never saw that coming. I just I didn't really understand what was going on. It it's not, I don't think it's an especially good look. So I think either way, whether you are complicit in the bad behaviour or you just didn't realise what was going on, I think that is damaging to the perception of the current leadership within EA. I think there's a question, you know, more broadly, not not specifically about Sam Bankman Freed, but was it a bad idea to become so reliant on a single big money donor? I'm sure it was very tempting because if you can land that one very, very big fish and they'll give you huge amounts of money, that is a lot easier than trying to convince large numbers of people to give you smaller amounts of money, particularly for a movement like EA, which maybe always has a slightly uh limited niche appeal. But I think obviously concentrating that amount of power within the movement in one person would always bring risks. And I think above and beyond that, I think some people I've seen within the EA movement saying, well, I think we should have been aware, or the leadership should have been aware, that the risk was significantly higher, given that this person was in the world of crypto and crypto exchanges, not a field that is, you know, well known for its stability and lack of risk. And you know, actually the EA movement has had previous experience with crypto donors that have subsequently caused them some kind of ethical and reputational issues. So it's not even like this was the first time. So I think you know that's an interesting question. And then I guess you know, in terms of finally the the impact on the movement, it's what lesson everyone chooses to take from what has happened. Um, and a huge amount of you know, uh comment and and response and analysis seems to have been going on in the EA world, if you look at the the forums and things, between people who think that this is a pretty sort of fundamental uh less you know um moment for EA, and that you know, actually maybe the movement needs to totally redefine itself and change the way it talks about it, change the name, have more humility, get away from some of its core ideas, like the sort of earning to give idea and acknowledge some of these problems, and others wanting to say actually, you know, Bankman Fried is just a sort of lone bad apple, and we don't we shouldn't be taking uh wider lessons from it, um, and all these kinds of things. And I think it will be interesting to see whether that division does lead to kind of fundamental schisms within within the movement in in coming years. Which I guess leads on to thinking about what the impact on EA as a broader ideology might be. I think that if the narrative that Bankman Fried's Bankman Fried's effective altruism beliefs weren't weren't just incidental to what happened in his business, but actually fundamental to it. If that view takes hold, then that is potentially quite damaging for effective altruism. You know, the the picture that we get is one of a kind of diehard consequentialist utilitarian who basically sort of believed the means justified the ends, and and had a lot of intellectual hubris and self-confidence, and and essentially kind of believed that he and his friends within this movement were so brilliant that they were kind of uniquely well placed to determine what the biggest problems facing society are and how to address them, and so therefore, you know, they had a right, if not a duty, uh to get as much money as possible in order to spend it uh in the ways that they thought necessary, and that this may well have led them to a point where they believed bad behaviour up to an including outright fraud was justifiable by those ends. Now, some people might think that that is a caricature, and and you know, I'm not particularly claiming that that's my my view of events, I think it's more complicated than that. You know, I think people within the EA movement will point out that not all EAs are strict consequentialists by any means. So they don't, you know, lots of them will say, of course I never thought that the end justified the means to that extent. And you know, lots of them are coming out now to to make statements to that effect. There was a uh post on the EA forum saying, you know, we need to be very clear that fraud is in the service of EA is not something that we're uh we're down with, which you know it is good that you say it. I mean, the fact that you feel the need to say it seems a bit peculiar, but there we go. I think some people have kind of countered to that and said, well, yes, but if you're saying uh, you know, we never thought the end justified the means, and obviously we needed to kind of stick to more common sense moral norms on the way, that would be more credible if it wasn't for the fact that lots of the time uh effective altruism goes out of its way to kind of uh engage with slightly counterintuitive uh views and to to kind of question established uh social norms and moral norms. Um so actually, you know, it's not beyond the realms of possibility to think that somebody within that world would have just thought that actually you know an end justifies the means mentality. That did go against uh kind of uh established moral norms and and actual laws was acceptable. So I think you know it's it's difficult to shift that perception. I mean, another rejoinder from people within the EA world is that you know that Bankman Fried wasn't actually, in fact, one of them. So, you know, it has some people sort of subsequently questioned whether he was even really an effective altruist at all, because they thought, you know, nobody who was a true EA believer um would do something like this. And certainly in that ill-advised um interview that Bankman Fried gave to Kelsey Piper at Vox, he seemed to say some things that suggested there that maybe he didn't really believe everything he was saying when it came to questions of ethics and morality. It's not entirely clear what he was quite referring to there and whether he was talking about his EA beliefs or whether he was talking about actually the need to kind of acknowledge uh broader kind of common sense moral principles. So it's so it's not clear from that point of view whether or not that that is a sort of smoking gun that tells you he wasn't an EA believer. It does seem a bit implausible in some ways to say that he wasn't, and this was part of a kind of brilliant Machiavellian scheme from the outset to dress you know this wolf in the the sheep's clothing of EA in order to um to kind of uh get people on board with with what he was doing um and let him get away with his fraudulent behaviour. I mean, I guess for a couple of reasons. One is that he was into effective altruism before he even started getting into crypto and he worked at effective altruist organizations. So you have to believe that at some point at least he genuinely believed this stuff. I think the other thing is if if you were going into fraudulent activity and you wanted to use philanthropy as a means of deflecting criticism, I'm pretty sure I wouldn't go into EA and long-termism as the way of doing that, because I think that's going to attract more scrutiny and criticism in a lot of ways. I'd probably go for a much kind of blander, more traditional form of philanthropy. But but you know, I don't actually think that was what's happening. So perhaps you know it's unsurprising that that didn't happen. And then just think finally about the the impact on EA and uh as a kind of field of academic study. Um I think here maybe the impact will be slightly less keenly felt. I mean, only because so utilitarianism thinking and kind of consequentialism has been around for hundreds of years, at least, at least uh since the thinking of people like Jeremy Bentham uh in the 18th century. And it, you know, it that whole time, certainly in the latterly, it's been criticised for its potential real-world unintended consequences. And you know, you might think that this is just another example that will kind of strengthen that case, because people will say, well, look, this is what happens when you adopt these views in the real world, is you know, this kind of situation. But I guess the the point to make there is that ethical theory, particularly in philosophy, doesn't tend to live or die in empirical terms. Um, what happens in the real world uh is not always taken as a reason to abandon a particular particular ethical framework. I mean, if you've ever sat in a philosophy uh seminar, you'll know that philosophers don't necessarily really uh care about whether or not what they're proposing um has been applied properly in the real world if it if it works in kind of uh theoretical terms. Um and so you know, we're still talking about utilitarianism 200 years after Bentham because actually at a at a sort of deep theoretical level, it makes quite a lot of sense of you know complex real-world problems, and so it has a definite appeal for moral and ethical philosophers. And so I don't think you know effective altruism uh in that sense will go away. It's just kind of the latest iteration of a of a pretty kind of continuous line of thinking that has always had some appeal. I guess what there might be is an acknowledgement that the move from the classroom to the real world uh maybe has been slightly more problematic than first thought. I think that transition from something 10, 15 years ago that was largely the preserve of kind of academic discourse into the real world and the influence that has had and what it has led to, some people might sort of think, hmm, yeah, actually maybe that wasn't such a a great idea. And maybe they will maybe that will kind of then develop into people who acknowledging that in the move into the real world, you probably do need to kind of translate and and change the the way in which EA thinks about things in order to kind of acknowledge uh real world factors, and some people who might want to kind of revert to the classroom and stick to the kind of purer form of EA almost as a theoretical exercise. And then I guess you know, in practical terms, there might be less money for EA aligned research institutes in in future, of which you know there are some in kind of academic centres as well. So it might that might be another kind of impact. Um I guess just to finish this thought, you know, what what is it that's going to happen? Well, over the shorter term, I think EA is really kind of struggling with a bit of uh a kind of crisis of image and you know, lots and lots of newspaper articles and comment pieces uh coming out at the moment being very critical of EA at a pretty sort of fundamental level. As I say, if that kind of sticks as a narrative or if elements of it do stick, I think that could make things difficult for effective altruism in its current form as an ideological framework kind of movement to to kind of continue to exist. I don't think it will just wink out of existence. That's not how things tend to happen. I think what might happen is that the movement itself might fracture, as I've success as I've suggested, and that those, you know, there might be a split, for instance, between phase one or traditional effective altruists who want to kind of go back to more of the focus on treating, you know, diseases in the developing world and malaria and bed nets and deworming and that kind of thing, and those who kind of got on board with long-termist ideas about existential risks and AI safety and that kind of thing. Maybe we'll see those kind of split into to two slightly different movements, because you know, there have been tensions there anyway. Maybe the movement will acknowledge that it needs a bit more intellectual humility. I think it's long been accused of being quite kind of uh, you know, self-regarding in in that sense. And, you know, maybe kind of acknowledging that the the quite top-down donor-driven approach that effective altruism takes um needs to be kind of tempered with some thought of allowing others within the community of recipients and kind of people and communities that they're they're doling out money to to have some say and kind of acknowledging that they have a valid viewpoint as well, which is obviously a trend that is going on more widely in philanthropy, but I don't think has necessarily filtered into EA in in a meaningful way. And I guess the other thing that might happen is just that more ideas from effective altruism basically end up kind of filtering into more mainstream philanthropy, and then EA in its current form kind of goes a bit by the wayside, but but it's you know, its ideas, or at least those that people think are worthwhile, live on. And this is something that tends to happen quite a lot, you know, historically, if you look at other examples of movements that have tried to kind of make philanthropy more rational in some sense, and particularly if you look at the history of charity organization societies and the scientific philanthropy movement in the late 19th and early 20th century, eventually they kind of dissipated, but the charity organization society movement particularly kind of became it, you know, it left behind the legacy of casework and investigation, which essentially became part of the grounding for modern social work, and the scientific philanthropy movement became uh kind of interpreted into the big philanthropy of the early 20th century and and foundations set up by people like Carnegie and Rockefeller and others who kind of very much bought into those ideals. So they they stopped existing as movements necessarily, but their ideas lived on in various different forms. And I wonder if something similar will happen for EA. Okay. Uh well that's a lot of thoughts on EA. Um, just briefly in a moment, I'm gonna just quickly run over what's been going on with Jeff Bezos and Mackenzie Scott, uh, a bit of compare and contrast just to finish things off, because I think it's worth kind of um just giving you uh a couple of thoughts on those, so stay tuned for that.

SPEAKER_04 52:55

Yet today is not far distant when the man who dies leaving behind him millions of available wealth, which want me for him to administer during life.

SPEAKER_00 53:41

Okay, so yeah, I just wanted to briefly come back um and uh mention a bit about a couple of other pieces of news with uh some of the the kind of most notable big donors operating in the world today, and particularly Jeff Bezos, um Amazon's founder and sort of continual uh figure of controversy, and Mackenzie Scott, who is Bezos's uh former wife, but uh these days I think more importantly is just a really interesting uh and big money philanthropist in her own right. So the the kind of the news that probably caught slightly more column inches um in recent weeks was about Bezos, um, because he made a big announcement to pledge to give away most of his wealth uh during his lifetime. Um this is noteworthy because uh certainly during their his marriage to Scott, Bezos uh refused to sign the giving pledge, the the Bill Gates-Warren Buffett giving pledge. Scott subsequently did sign it as soon as they got divorced and has been kind of making good on that ever since. Bezos still hasn't signed the giving pledge, but he has sort of come out and made a pledge of his own. I think the first thing to say is, you know, again, it's a pledge to do something in the future rather than actually just giving the money now, which contrasts somewhat uneasily with Mackenzie Scott, who tends to make announcements about how much money she has just given, rather than making sort of bold claims about what she's going to do in the future. Um and I think there is some reason to have scepticism about this model of making big announcements about what you're going to do, particularly where some of the details are quite vague. And this is something Jeff Bezos is guilty of quite, you know, quite a few times. I think a few years ago when he launched the Bezos Earth Fund, uh, he kind of announced that he was going to give $10 billion to fund climate issues. And people sort of said, that's great, but what does that look like? How are you going to do it? What kinds of organizations? What are you going to focus on? And there weren't any answers to those questions. Similarly, this time, there aren't really any answers to how he's actually going to give away that money, uh, over what sort of timescale and what what the focus is going to be and all these sorts of things. So I think there's a lot more still to be said about it. You know, that being said, to give him his due, in the subsequent two years since the Basil Surf Fund was announced, it is now operational and has given away quite large amounts of money. So, you know, he is he is doing something, but it's just the model of kind of making the big announcement and getting the publicity without having all the details in place, I think, just uh sits uneasily with some people. The bit of of the announcement that really caught my eye as a history philanthropy nerd was Bezos made a big play of the idea that his kind of reticence to to make a big pledge like this previously had maybe been that it's it's hard to give money away, um, particularly as he said in a in a levered way. And this is an idea that has a really long history, because um certainly you can go back to Aristotle kind of saying uh anyone has the capacity within them to to give money, but you know, not all people have it within their power to give that money well. I'm paraphrasing there, but um, so he he was kind of saying that. And then Carnegie um famously and slightly apocryphally um said, you know, it's far harder to give money away effectively than it is to make it in the first place. Um and this is an idea that's really sort of stuck with big money philanthropists that it this this is somehow that something that is somehow kind of inherently very difficult. And there is an element of truth in that, in the sense of, yes, it is difficult to give away very, very large amounts of money, but it is also tied into what your view is about what it means to give money effectively, because I think the the paradigm has been one in which it's been very much sort of up to the donor to determine what the problem was and what the most effective way to deal with it is, and the measure of success will be how effective it is in terms of you know measures of the money being sort of well spent and and kind of metrics being established on the basis of sort of social impact outcome. But actually, when you look, for instance, at what Scott's doing, the really the really interesting thing about that to my mind is she's doing something very different that allows her to overcome that challenge. So she's given very large amounts of money away very quickly. And why is it that she's able to do that? Well, in large part, I think it's because her notion of effectiveness um is very different. So, from sort of Scott's point of view, uh when it comes to philanthropy, the point is to uh to cede power uh as far as possible to the organizations and the kind of communities that you're giving to on the basis that they know best what their problems are and how to deal with them. And so the measure of effectiveness is, to my mind, the extent to which you have achieved that by handing over money as quickly as possible and giving them that power. The measure is not then, you don't at the same time say, Oh, but I'm also going to set up my own list of metrics as a donor and then kind of track the effectiveness of of this against those. And if it turns out you didn't spend the money in the way I think you should have done, then my giving has been ineffective. But I think people do still kind of apply that that thinking. Interestingly, the Center for Effective Philanthropy in the US put out reports um just this last couple of weeks, the first of three over the next three years, looking at Mackenzie Scott's giving and assessing whether actually you know her her approach to giving is effective in a in a more general sense. And and their conclusion so far is yes, it is, because it seems to have had a very positive impact on the organisation she's working with. Um and she just announced the the latest tranche of her giving, and I think the thing that was really noticeable in that was the the very the centerpiece of what was admittedly quite a short blog this time, uh along with the sort of list of organisations she's given to, was just a poem that she she wanted to highlight, which essentially I think makes a key point about the dangers of paternalism within philanthropy. Um it's a poem called Dakota Homecoming by Gwen Nell Westerman, who I think is a Native American poet, um indigenous poet. Um and uh the poem just goes uh We are so honoured that you are here, they said. We know that this is your homeland, they said. The admission price is five dollars, they said. Here is your button for the event, they said. It means so much to us that you are here, they said. We want to write an apology letter, they said. Tell us what to say. So you know I think this is a really, really good poem. It makes sort of point about the the gap sometimes between saying that you want to kind of empower communities and and kind of hand over control to them, and the reality when you do that in a in a way that isn't meaningful or you still kind of retain too much control um as a donor. Uh and I think by kind of putting this poem at the centre of a latest blog, Scott is is quite sort of uh subtly making that point. The other bit, just to note about the Jeff Bezos story, that's not directly, I think, linked to the announce the big announcement about trying to give away all of his money, is that at the same time he announced that he and his his new partner Lawrence they've uh decided to give a million and a hundred a hundred million dollars to the singer, uh country myest and singer Dolly Parton. So this is part of Bezos's annual courage and civility award, which has been going for a couple of years now, and I think sort of rewards people that they feel are doing work that can kind of overcome societal divisions and bring people together. You know, that that aim seems admirable, and and certainly Dolly Parton herself, I think, and what she does in philanthropy is is very admirable. I think she's a really interesting philanthropist. I I'm not sure from my point of view how this fits with Bezos' points about wanting all the giving to be levered and sort of you know highly strategic. It doesn't seem you know to fit so much with that model, but maybe that's because this is a kind of different bit of his philanthropy and and he was talking more about the bit he wants to to do with with the rest of the money, but perhaps. I think the suspicion from some people with this story is that it felt a bit more like it was informed by a desire for some nice PR. You know, I think basically if you wanted to get good PR as a philanthropist by giving money to another philanthropist to distribute, um, Dolly Parton would be pretty close to the top of your list. Um, I think she's you know, she's known for being really kind of committed, she's been doing this stuff for a long time. She's very focused on particular um set of issues uh around childhood literacy, particularly, although she subsequently um given quite a lot of money for developing vaccines as well. And she's seen, I think, as very authentic because her story about her own upbringing in really, really kind of severe poverty and how that informs her view of life is I think you know, really kind of uh compelling for people. I think also, you know, people sort of get her, they understand how she made money by being very successful in music. Whereas I think for lots of other billionaires and wealthy people, often the act the exact nature of their wealth creation is a bit of a mystery to most people because it's sort of something to do with finance or technology. So I think from that point of view, she's a really kind of um accessible, understandable, uh approachable philanthropist. And, you know, I can see how it would be appealing for Jeff Bezos to want a little bit of PR for his his philanthropy, because he, you know, objectively he he is giving away quite a lot of money, um, and yet he doesn't really get very good publicity for it. And you know, that might be partly because he is giving away a lot of money, but it's still not that much in proportion to his overall wealth, which is absolutely vast, and it seems to say a little bit kind of haphazard, he's had a few false starts here and there in terms of like having a big announcement about some plan and then not really seeing what's happening with that, and then moving on to something else. I think you know, for for those who are more kind of maybe in the world of philanthropy and and interested in philanthropy reform, his approach does still embody a quite a sort of top-down technocratic version of philanthropy that's very kind of donor-driven. And so maybe it doesn't contrast that well with Mackenzie Scott's approach to philanthropy. Um and then I think the other thing is inevitably whatever Jeff Bezos does in terms of philanthropy needs to be set in the context of his tax affairs, Amazon's tax affairs, the labour practices at Amazon, of which there are many, many justifiable criticisms. And so lots of people are saying, well, that's fine, you can do your philanthropy if you want, but that doesn't stop us uh kind of making those criticisms. And in fact, you've got a long way to go to answer those criticisms before we'll even sort of get to the point where we're willing to give you credit for your philanthropy. So I think you know, there's a a challenge for for him there. Just to kind of pull all those thoughts together, I guess, you know, what does all of this mean? I think it means that there's more scrutiny than ever before on elite philanthropy. Um, you know, there's there's scrutiny, there's also some scepticism, uh, and plenty of cynicism as well. You know, I think that is probably less helpful. I think the the scrutiny um is good. I think, as I said up front, I think we need to be careful about the lessons we take from particular examples. I think we need to be careful about extrapolating from individual examples of absolutely sort of vast ultra-wealth philanthropy to what philanthropy you know as a whole is and and what the trends are within it. And also take into account the the fact that a lot of this happens in a sort of US context, and that doesn't always read across to the UK or other places. I think some of the the critiques and criticisms maybe can be answered to some extent, uh, and I think engaging with them so that you can do that is important. Um, but I do also think, you know, even if they're sometimes overstated and some of them are kind of put in polemic ways, a lot of there is a kind of kernel of something pretty important and true in a lot of this critique, uh, and that needs to be taken on board uh by anyone who sort of works within philanthropy and remains uh positive about its ability to be a sort of a force for driving good in society, because I think that way we can make sure that we get not just more philanthropy, but better philanthropy in some sense, you know, philanthropy that is better for the recipients, better for society, better for democracy, and and to be honest, in the long term, I think better for the donors. I think it's positive all the ways around. And, you know, fortunately, I can leave you with the thought that I will have a book coming out next year called uh What is Philanthropy for with Bristol University Press out in March that will look very much at exactly this question. Uh it's almost as if I planned this whole thing, isn't it? But anyway, I hope you've enjoyed that. Um, I will put links in the show notes to uh lots of the things that I was talking about where you can read more. If you fancy just reading some more in general on philanthropy and civil society issues, do check out the website at whyphilanthropymatters.com. You can drop me a line at uh Rodery at whyphilanthropymatters.com if you've got ideas for people I could talk to on the podcast or or topics you'd like to see us cover. You can follow me still for now on Twitter at Rodery underscore h underscore Davis and uh at philiteracy. Uh, I'm also on Mastodon, uh so do check me out there. I'm on the mstdn uh dot social server. And other than that, just like, subscribe, tell all your friends about it, leave a nice review on iTunes or wherever you get your podcasts, and I'll see you next time. Bye.