What Happened Today: December 12, 2022
Justice for Lockerbie; Fusion is real; Beware the Do Gooders
The Big Story
On Sunday, the Justice Department confirmed that a former Libyan intelligence officer allegedly responsible for the bomb that blew up a Pan Am passenger plane in 1988 over Lockerbie, Scotland, is now in U.S. custody. The suspect, a former Libyan intelligence operative named Abu Agila Masud, is set to appear in a U.S. District Court in Washington, D.C., as early as this week for his role in the death of 259 passengers on board and 11 on the ground. Masud was first charged for the terror attack by then outgoing U.S. Attorney General William Barr, in 2020. The charges followed a 2017 breakthrough in the case when the FBI obtained an earlier interrogation of Masud conducted by a Libyan law enforcement agent in 2012 after the fall of the Gaddafi regime. In that interview, Masud admitted to making the suitcase bomb with metallic components placed near the metal locks of the suitcase to avoid detection by airport security. Legal experts have raised doubts about whether Masud’s previous confessions to involvement in the bombing, given while he was in custody in a Libyan prison, would be admissable in a U.S. court.
Only one person, a Libyan intelligence officer named Abdel Basset Ali al-Megrahi, had previously been convicted for his role in getting the bomb onto the Pan Am flight 103, which was the deadliest terror attack to ever take place in Britain and the largest loss of life against American citizens until 9/11. After years of declining requests from the United States and Britain to turn over Megrahi, Libyan leaders finally relented in 1999, handing him over to a Scottish court that sentenced him to life in prison. The court’s decision to release Megrahi because of a terminal cancer diagnosis in 2009 was roundly criticized by U.S. officials who’d spent the better part of the ’90s trying to bring him to justice. After being freed from prison, Megrahi spent the past two years of his life living in Tripoli at a lush villa overlooking a pool and garden.
Read More: https://www.bbc.com/news/uk-scotland-63933837
In the Back Pages: Beware the Do Gooders
The Rest
→ Scientists have been chasing the so-called holy grail of carbon-free power for the past 70 years—and now the Department of Energy is set to announce on Tuesday that fusion scientists working in a government lab have done just that. The team at the Lawrence Livermore National Laboratory in California have for the first time produced a fusion reaction that smashes two atoms together and transforms the energy of the collision into electricity, all without producing any carbon or radioactive waste or byproducts. For decades, scientists have tried to engineer a fusion reaction like this that produces more energy than it consumes, and it’s likely it’ll take decades more for the process to be scaled up to make fusion energy capable of generating electricity for the power grid. Still, the findings mark a major milestone in the quest for fusion energy into which governments worldwide have poured billions of dollars.
→ Quote of the Day:
“I think about what it would be like, and it’s scary. Where am I going to go?”
That’s Debbie Shelley, 62, a retired social worker who’s worried she soon might be without a place to live after her rent was recently raised on her Boise, Idaho, home. With ongoing medical issues of her own, and the death of her husband from COVID-19 two years prior, Shelley joins a growing number of older Americans who are facing the prospect of homelessness caused by the spike in rental prices nationwide coupled with a dearth of affordable housing options. In Shelley’s city, average rents are up to $1,778 a month after hovering at about $1,200 in 2019. The number of patients older than 50 seen by the National Health Care for the Homeless Council, an organization that runs 300 health programs nationwide, has continually increased, growing from 25% in 2008 to 36% in 2021. For those older than 65 who are participating in the programs, that number has tripled over that same time frame, rising from 3% to 8%. “This is a level of a problem that we have not seen before,” said Barbara DiPietro, who oversees policy for the Homeless Council. “We are seeing older people in shelters and encampments, or who are living in their cars at a rate that we never had before.”
→ After nearly three decades in circulation, Bookforum announced on Monday that the magazine’s current issue will be its last. The influential New York-based literary publication was founded in 1994 and has been publishing five issues a year since 2005. The slow collapse of the New York literary world continues apace.
→ As part of an ongoing investigation into possible bribes made by Qatari officials to members of the European Parliament (MEPs), Belgian police raided the homes of several current and former MEPs and seized €600,000 in cash over the weekend. The raid came after a Belgian judge signed off on a warrant against four people accused of “participation in a criminal organisation, money laundering, and corruption.” The raid prompted a wave of resignations across parliament and halted a forthcoming vote to grant Qatari nationals visa-free entry into the European Union that was set for next week. The scandal comes as Qatar, which is currently hosting the World Cup, has struggled to temper international scrutiny of its abuse toward migrant workers and its stance on gay rights. Investigators have not named any suspects, although Eva Kaili, an E.U. parliament member from Greece, was stripped of her legislative assignments and her membership within the PASOK, the Greek socialist party. Kaili was an outspoken advocate of Qatar in November, speaking of the Gulf country’s sterling reputation as “a frontrunner in labor rights,” even as watchdog groups reported in recent months about the deaths of hundreds of migrant workers toiling in dangerous conditions to build the World Cup facilities.
→ A second journalist covering the World Cup in Qatari has died suddenly under mysterious circumstances. On Sunday, U.S. journalist Grant Wahl, 48, died soon after he collapsed at the match between the Netherlands and Argentina. Wahl had been detained early in the tournament by Qatari officials and denied entry into a stadium because he wore an LGBTQ rights T-shirt, which violated the country’s strict stance against display of support for gay rights. “I do not believe my brother just died. I believe he was killed,” said Eric Wahl, Grant’s brother, as details about his death remain sparse. On Sunday, Khalid al-Misslam, a Qatari photojournalist, “suddenly” passed away, said Gulf Times, the Qatari news outlet.
→ Number of the Day: $2.5 billion
That’s how much Mars, the world’s largest maker of confectionery sweets and candies, has made so far as part of its massive push to bring chocolate to developing countries. Banking on the success of such delights as a bacon-flavored Snickers bar, Mars hopes the annual volume of confectionary products consumed in emerging markets will at least double by 2024, pushing its snacks into Kenya, Nigeria, and other nations with low consumption of factory-made candy. “The amount of chocolate that an Indian or a Mexican consumes is 10 times or less than a European,” said Blas Maquivar, who runs the global emerging markets team of the Mars snack division. “There is a gigantic opportunity to take that low … per capita consumption closer to Europe.” Some of that opportunity relies on getting more candy on more shelves in independent stores and street stalls that don’t participate in the Mars distribution networks, though it won’t be just chocolate goods that Mars hopes to bring to mom-and-pop shops across the Global South. In 2020, the company plunked down big bucks for the “wholesome” snack bar maker, Kind, valued at $5 billion, which Maquivar says will help it tap into the ongoing “mega trend of health and well-being.”
→ “Demand for these new agents has been unlike anything I’ve ever seen in my time in medicine,” said Dr. Michael Albert, a specialist in weight-loss treatment discussing the explosive popularity of Wegovy, Ozempic, and other drugs originally designed for the treatment of diabetes that have since become a social media sensation for their ability to reduce appetite. Online endorsements from Elon Musk and other celebrities have only fueled the demand for the drugs, despite their hefty price tag, with Novo listing its Wegovy at $1,349 a month, though some insurance companies are picking up the tab. The run on pharmacies for the miracle pills have left some patients who need the drug for their diabetes treatment scrambling, and a shortage of the drug because of production missteps by Novo has only worsened the supply bottleneck. Analysts say a rush of competitors entering into the space to produce the medication that imitates the hormone known as GLP-1, which suppresses appetite, will help propel the anti-obesity drug market, currently worth $2.4 billion globally, to $50 billion by 2030.
→ Thread of the Day:
Photographer and writer Marc Davenant breaks down why so many novels, books, and television series today often feature characters that look alike, have the same problems, and share the same narrow band of preoccupations, often without any real grasp of the experience of American or British working-class people. Across the creative arts in Britain, the number of people who come from working-class backgrounds has shrunk by more than half since the 1970s.
→ It’s not looking good for Credit Suisse. Financial documents seen by the Financial Times show that a $140 million loan the bank made to Greensill Capital, a supply chain firm with ties to former U.K. prime minister David Cameron, was based at least in part on invoices for services from companies that denied they’d ever provided the services mentioned. The likely fraudulent invoices add to the ongoing accusations of gross negligence against management at Credit Suisse, as the documents were used as collateral for the loan. In recent weeks, top Credit Suisse executives have left divisions of the bank in China and Italy, departures that follow the elimination of thousands of positions at the Swiss firm amid a comprehensive restructuring to try to stabilize investor confidence.
Read More: https://www.ft.com/content/595c3c7e-8652-45da-87eb-ca70da3b1b8f
TODAY IN TABLET:
The Best Jewish Children’s Books of 2022 by Rachel J. Fremmer
This year’s picks include two stories about Sukkot, two about a remarkable scientist, and many more tales to take young readers from the shtetl all the way to Atlantic City
A Woman’s Voice by Nomi Kaltmann
Chana Raskin breaks new musical ground with an album of Hasidic melodies
SCROLL TIP LINE: Have a lead on a story or something going on in your workplace, school, congregation, or social scene that you want to tell us about? Send your tips, comments, questions, and suggestions to scroll@tabletmag.com.
Beware the Do Gooders
How a new class of capitalists couched their profit-seeking in the language of social justice and altruism
By Sean Cooper
Gone are the days when villains dressed the part and Wall Street vampires suited up like Gordon Gekko. These days, an American who wants to avoid being swindled needs to watch out for the t-shirt clad do gooders spouting the proper politics and pieties while claiming that they only want to save the world. The recent collapse of Sam Bankman-Fried’s cryptocurrency empire, FTX, fit the larger pattern: it was a massive financial scam marketed as a moral cause that got away with it by flattering the high priests of the press and offering elected officials promises of gifts and donations.
Before FTX, it worked wonders for Theranos, WeWork, and the Black Lives Matter Global Network. Millions and then billions of dollars were poured into corporate vessels promising change, their founders cozy with a media that long ago abandoned its role as a check on the nakedly self-promotional claims of the rich and powerful.
With the financial and philanthropic worlds now firmly wedded, there are even bigger bubbles yet to burst, like the Environmental, Social, Government (ESG) funds that consulting powerhouse McKinsey estimated had a total global value of $2.5 trillion midway through 2022. The conditions that allowed for a $10 billion crypto empire to vanish into thin air have only become more conducive to the Do Good grift, like a virus replicating itself inside a host’s body.
As a public face for the effective altruism movement, Bankman-Fried’s particular brand of swindle was different in detail but not in kind from the snake oil sold by Theranos founder Elizabeth Holmes. Holmes was sentenced last month to 11 years for charges related to misleading investors about the fact that her $9 billion genetic testing startup was a fraud with no ability to do the things it promised. A similar pattern of financial swindling, albeit on a smaller scale, has taken place at the Black Lives Matter Global Network Foundation. In a new lawsuit filed in September, more than 25 local BLM chapters sued the foundation’s current leader, Shalomyah Bowers, for allegedly “devising a scheme of fraud and misrepresentation” to siphon out more than $10 million from donor coffers. Bowers was brought into the organization by BLM co-founder Patrisse Cullors before Cullors stepped away amid her controversial spending of $3.2 million on four luxury residential properties. Clapping back at the local BLM chapters, Bowers accused them of perpetuating the “carceral logic and social violence that fuels the legal system,” for reporting his alleged grift.
The child of two Stanford law professor parents who debated the merits of political activism at the kitchen table, Sam Bankman-Fried (SBF) was steeped in the do gooder ethos from a young age. He first attended an elite prep academy and then MIT, where he fell in with Will MacAskill, an Oxford-trained philosopher looking for recruits to his new effective altruism (EA) movement. Rooted in the utilitarian philosophy of Peter Singer, EA practitioners injected philanthropy with a dose of financial optimization by claiming a moral obligation to make as much money as possible for the sake of giving it all away. The opportunity to appear entirely noble while accumulating a fortune apparently appealed to SBF, who took up the EA mantle as he moved on to the New York trading firm Jane Street before hanging out his own shingle with what would soon become the FTX crypto exchange.
“SBF’s purpose in life was set: He was going to get filthy rich, for charity’s sake,” went a profile on the website of Sequoia Capital, the venture fund that would soon plow $214 million into FTX. But even a small fortune wasn’t going to fully quell SBF’s itch to truly make his mark. As the Sequoia profile noted, SBF “needed to take on a lot more risk in the hopes of becoming part of the global elite.”
Bankman-Fried’s timing was fortuitous—the EA movement itself was growing in stature amongst the global aristocracy he aspired to join, and which already included high profile practitioners like Facebook co-founder Dustin Moskovitz and Linkedin leader Reid Hoffman. As SBF’s crypto exchange grew, so too did the number of articles depicting his beneficent intentions to save millions of lives with malaria interventions, $2,000 at a time. The signs that SBF was using the language of altruism as a cover for a naked pursuit of power were ignored. Much was made of SBF’s dogged work ethic and modest lifestyle—how he slept on a bean bag beside his computer in a house with nine roommates. Little scrutiny was given to the fact that the house was a $40 million dollar condo in the tax haven of the Bahamas, or that he shuttled himself around on a private jet.
The growing gap between the truth and the reality of SBF’s practice was as obvious to those within the effective altruism movement as it was to his own employees. “The problem was that there was a story about his frugality that was something adjacent to a lie,” one EA movement figurehead told The New Yorker. Within Alameda, the investment arm of FTX, SBF pushed his staff to take on the highly speculative crypto derivatives that other exchanges wouldn’t touch because they seemed so obviously designed to fleece ill-informed investors. “He was so excited about these products that are just so predatory―they are blatantly short-term gambling, and in the long term the house wins,” an Alameda staffer told the same The New Yorker reporter. “You can talk about ‘means justify ends’ stuff … but this was pretty clearly just, ‘We want to make this product so that we can essentially scam people out of their money and then give it to charity.’” Of course, the “give it away to charity” part of the equation ended up being less essential than the scam. For instance, of the $95 million that the Ontario Teachers’ Pension Plan invested in FTX, it was reported that SBF took a significant portion not for EA-branded charity but rather for his own personal use.
It shouldn’t have taken more than a reporter’s quick look around the FTX conference table, with the Caribbean ocean view off in the distance, to wonder what, exactly, SBF was up to. He’d carefully courted officials from the regulatory offices meant to oversee his business, bringing in Mark Wetjen and Jill Sommers from the Commodity Futures Trading Commission to serve as his head of FTX US regulatory policy and as a member of his FTX US Derivatives board, respectively. There were red flags in his Washington connections just the same. In March 2022, the so-called Blockchain Eight―a group of 4 Republican and 4 Democratic house representatives―sought to stall a new SEC’s probe into FTX and several other crypto firms. Of those eight officials, 5 had received donations directly from FTX staff, including more than $500,000 to North Carolina’s Rep. Ted Budd from a super PAC started by a top deputy of SBF’s at FTX, Ryan Salame. Though SBF has been described as a major donor to progressive candidates, he was giving lavishly to both sides of the aisle. Between SBF’s donations through dark money groups and those passed on by Salame, FTX contributed more than $60 million to Republican candidates this past election cycle.
Is the blame, then, for the total absence of scrutiny of FTX, or the scandals that preceded it, a failure of the fourth estate, or the government agencies presumably tasked with preventing industrial strength fraud and theft? Might it be both, and something else besides? For those charged with asking questions and holding power to account there’s an increasing reluctance to exercise that responsibility. It’s no mystery why, given the animus directed against those who do inquire about concentrations of wealth and power behind causes branded as socially beneficial. Just look at anyone who’s ever raised an eyebrow at the massive amount of money George Soros has plowed into district attorney elections to support stridently progressive candidates and then been called an antisemite.
Now, though, there’s a cold logic that’s starting to assert itself amongst those who must prioritize their fiduciary responsibilities above the feel good shoveling of money into a furnace labeled Good Cause. The world’s largest mutual fund manager, Vanguard, said last week that they were cutting ties with Net Zero Asset Managers, a climate-focused ESG alliance of investment firms with roughly $66 trillion in managed assets. "We have decided to withdraw from NZAM so that we can provide the clarity our investors desire,” said Vanguard, which manages $7 trillion in assets. That move comes after the chief financial officer of the State of Florida said earlier this month that he was removing the $2 billion of the state treasury portfolio invested in Blackrock because of their allegiance to ESG over their duty to the bottom line. “We are disturbed by the emerging trend of political initiatives like this that sacrifice access to high-quality investments and thereby jeopardize returns, which will ultimately hurt Florida’s citizens. Fiduciaries should always value performance over politics,” Jimmy Patronis, the CFO said, echoing a move made by the Republican-controlled treasuries in Missouri and Louisiana, which took out roughly $1.2 billion collectively from Blackrock in October for similar complaints.
That mutual fund managers and financial officers in oil-rich states both see more money to be made away from ESG virtue signaling speaks as much to the incentives pegged to fossil fuel profits as it does the loosening of the grip ESG has had on the financial sector. But moralizing investment ventures are no more likely to disappear completely, as Silicon Valley’s most noble-minded hucksters continue to reinvent the do good scheme under refreshed logos and branding. After WeWork founder Adam Neumann’s attempt to “elevate the world’s consciousness” with his shared-office business led to a failed IPO and a scandalous resignation from his own company, he was back on his social change grind this summer, raising $350 million from Andreessen Horowitz for Flow, a real estate startup selling branded apartments and communities.
On Friday, Crain’s New York reported that the ratings firm Fitch projected that WeWork, Neumann’s first attempt at transforming society, was on the brink of bankruptcy, with only 12 months of cash on hand to offset 18 months of losses on the horizon. The largest commercial tenant in New York as of 2019, WeWork could simply cancel out $700 million in leases during bankruptcy, Fitch noted, which wouldn’t matter much for Neumann, who would still have his $1 billion golden parachute even after leaving a blood bath to clean up at all the abandoned offices that once promised communal harmony.
Correction:
A previous version misattributed a $350 million investment by Andreessen Horowitz to Flowcarbon when it was made to Flow. Both start ups were co-founded by Adam Neumann and backed by Andreessen Horowitz. The Flowcarbon crypto token is not related to the Flow real estate venture.
this article falsely claims that sbf/ftx gave $60 million to republicans. there is zero evidence that is in any way accurate. so why would they publish a naked lie?? perhaps the sbf money train made a stop at tablet/scroll?