Conspicuous silence over fallen crypto king’s Democratic ties
Becket Adams
The story of FTX’s downfall is complicated, convoluted, and unbelievably stupid.
And the only thing dumber than the people who fell for a 27-year-old tech bro’s promise of wealth and unimaginable riches has been the corporate press’s coverage of the crypto exchange’s implosion.
The short of it is this: FTX founder Sam Bankman-Fried is almost certainly a conman and a thief. He opened a “bank” (a crypto exchange), accepted deposits of real money, helped himself to customers’ deposits without their knowledge, and then distributed mountains of cash to friends and, more importantly, Democratic coffers. Indeed, Bankman-Fried ranked as the Democratic Party’s second-biggest individual donor in the 2021–2022 election cycle, pumping an estimated $40 million into various Democratic campaigns and activist groups.
Bankman-Fried was able to get away with the scheme for so long because he wrapped himself in the cloak of “effective altruism,” deflecting scrutiny and probing questions by promising to use his enormous “wealth” to address climate change, diversity and inclusivity, world hunger, etc., etc.
Don’t take my word for it. He admitted in a private conversation with Vox journalist Kelsey Piper the altruism bit was a front.
“You were really good at talking about ethics,” Piper said in a private message chat, “for someone who kind of saw it all as a game with winners and losers.”
“Ya,” Bankman-Fried wrote back, “Hehe. I had to be. It’s what reputations are made of, to some extent. I feel bad for those guys who get f***ed by it, by this dumb game we woke westerners play where we say all the right shibboleths and so everyone likes us.”
One would think the national press would take a sledgehammer to Baby Madoff and his apparent Ponzi scheme. But one would be wrong.
The New York Times and the Washington Post, for example, have covered the story with kiddie gloves.
“FTX collapse dooms founder’s effort to prevent another pandemic,” read a since-amended headline published by the Washington Post. Its subhead also read, “Flush with crypto cash, Sam Bankman-Fried spent tens of millions of dollars on campaign donations and projects intended to bolster public health and track emerging viruses.”
Yes, it’s a real shame the crypto world’s equivalent of Fyre Fest founder Billy McFarland will no longer be able to fund the projects that helped keep uncomfortable questions regarding his shady business model to an absolute minimum.
“When the coronavirus pandemic hit and the world shut down in the spring of 2020, many mourned the loss of life, jobs and normalcy,” the Washington Post report continues. “Sam Bankman-Fried, then a 28-year-old cryptocurrency entrepreneur, and his brother Gabe, a 25-year-old congressional staffer, said the pandemic provided them with something else: an opportunity to make a difference.”
It adds, “Harnessing the enormous wealth created by FTX, the cryptocurrency exchange that Sam Bankman-Fried had founded, they undertook a project to spend potentially billions of dollars on pandemic prevention, a long-neglected priority on Capitol Hill even amid the coronavirus crisis. The plan, drawn from the brothers’ adherence to a philosophy called effective altruism, sought to maximize philanthropic giving in ways that can have the most impact.”
The Washington Post has since amended the headline, and the wording of the story, to be somewhat less sympathetic: “Before FTX collapse, founder poured millions into pandemic prevention.”
At the New York Times, which published an article this week titled “How Sam Bankman-Fried’s Crypto Empire Collapsed,” the sympathetic coverage continued.
“Mr. Bankman-Fried said in an interview that he had expanded too fast and failed to see warning signs,” reads the story’s subhead. The report adds elsewhere, “In the interview on Sunday, he voiced numerous regrets over the collapse of FTX.”
“Mr. Bankman-Fried [agreed] with critics in the crypto community who said he had expanded his business interests too quickly across a wide swath of the industry. He said his other commitments had led him to miss signs that FTX was running into trouble,” the report continues.
The explicit implication here is that Bankman-Fried, who, again, is almost certainly a crook, simply got caught up in some bad fortune, as opposed to simply getting caught.
Notably absent from the New York Times’s report are mentions of the words “fraud,” “crime,” “stolen,” “hidden,” or “criminal.” The report does mention, however, that Bankman-Fried is getting good sleep. Thank goodness for small mercies.
Loophole
A slate of judges has struck down President Joe Biden’s unconstitutional student debt forgiveness program, arguing the White House scheme is, well, unconstitutional.
But you try explaining the law to the brain trust at the American Prospect, which characterized the ruling this week as a shadowy right-wing conspiracy reliant on legal “loopholes.”
“Right-wing judges across the country are finding loopholes to strike down President Biden’s student debt cancellation plan,” writes executive editor David Dayen. “The Biden administration needs to push back and prove it wasn’t a political stunt to attract young voters.”
The article adds, “The judiciary’s legitimacy is already at a low ebb; making up different sets of rules depending on the plaintiff would nosedive that even further. This legitimacy, while it seemingly doesn’t matter to unelected elites in robes, clearly had an impact on the 2022 elections. And in U.S. history, when the judiciary has been seen as a cancer on American life, it has often changed course, like the Lochner Court during the New Deal.”
It’s not entirely clear how “not authorized by Congress” counts now as a “loophole,” but OK!
Anyway, for what it’s worth, here’s some relevant text from the Constitution:
Section 7: Legislative Process: “All Bills for raising Revenue shall originate in the House of Representatives; but the Senate may propose or concur with Amendments as on other Bills.”
Section 9: Powers Denied Congress: “No Money shall be drawn from the Treasury, but in Consequence of Appropriations made by Law; and a regular Statement and Account of the Receipts and Expenditures of all public Money shall be published from time to time.”
Editorializing
Please, corporate media, we’re all begging you: Be professional.
Donald Trump announced this week he will run again for president in 2024. His announcement inspired major newsrooms to engage once again in the overwrought and self-indulgent style of coverage that defined much of the Trump-era news reporting.
Just observe these headlines and news blurbs marking Trump’s announcement.
From NPR: “BREAKING: Donald Trump, who tried to overthrow the results of the 2020 presidential election and inspired a deadly riot at the Capitol in a desperate attempt to keep himself in power, has filed to run for president again in 2024.”
From the Washington Post: “Trump, who as president fomented an insurrection, says he is running again.”
From NBC News: “Trump, whose lies about the 2020 election inspired an insurrection, announces third White House bid.”
They could’ve just said, “Trump announces a third White House bid.” The readers know who he is. They know what he has done. There’s no need to juice the headlines, begging readers to share in the author’s emotional response. There’s no need for handwringing or pointed asides. Keep that stuff in the opinion section where it belongs. People want to know what happened, not how some anonymous headline writer feels about it.