Politics. The excuse offered – that Sam Bankman-Fried gave tons of money to politicians and bought some peace – is an unsatisfying one. His Protect Our Future PAC's independent expenditures were mostly really stupid.
(Independent expenditures are made by Political Action Committees without any coordination with the candidate.)
Raised in a risk-free world where the primary unit of measurement, money, was free, Mr. Bankman-Fried’s political strategy was ill-advised, aimed at primary campaigns and particularly those seats left open due to redistricting.
Take Support Our Future’s involvement in Oregon’s 6th. Carrick Flynn, a first-time candidate with a sparse voting record and just recently relocated back to the district, benefited from $11M in independent expenditures. Additionally, Protect Our Future spent about $1M opposing the crowded field’s leader and ultimate victor, Andrea Salinas.
If that was not enough political malpractice – placing an outsized bet on an unknown running against an experienced politician in a safe district – Support Our Future also managed to convince a PAC aligned with House Speaker Nancy Pelosi to violate campaign norms and donate to Mr. Flynn’s primary effort as well.
(Party affiliated PACs don’t normally pick favorites in partisan primaries for obvious reasons.)
In all, Support Our Future placed bets on 19 candidates including Mr. Flynn. Independent expenditures on the other 18 total about $12M. All but two will not make their way to the House of Representatives in January.
To wield the political power Mr. Bankman-Fried sought – assuming that is what he was after – means doing a lot better than the venture capital standard of a 10% yield.
Policy. Interestingly, Mr. Bankman-Fried’s Support Our Future fund has but one cause, according to its website: Pandemic Preparedness.
Mr. Flynn, apparently, was moved to run for Congress because sections dedicated to pandemic preparedness were stripped out of the Inflation Reduction Act in late 2021.
Of course, no one has put their thinking cap on long enough to wonder if all the pandemic preparedness we have done since 2005, when President George W. Bush made it a priority, did any good.
Nor will they.
“Pandemic Preparedness” is policy shorthand in much the same way “anti-communism” was in the mid-20th century. From the perspective of proponents, it can also mean whatever you like and last as long as you can scare the public into believing you.
Like the “red-scare,” the abstract nature of global viral threats probably does not hold the public’s attention much longer.
Republicans in the House have promised investigations into c. 2020-21 pandemic spending. The political power Dr. Anthony Fauci has accrued walks out the door with him next month. A series of continuing resolutions are not likely to increase funding at NIH.
If history is any guide, the missteps of Mr. Bankman-Fried will accelerate the American policy pendulum’s swing away from its decade long obsession with microbes. Pandemic preparedness is now inextricably linked to the cynical exercise of power by a confidence man in cargo shorts and dirty t-shirts.
Power. Implicated in the tarnished reputation of “pandemic preparedness” is the philanthropy movement toward “active” involvement in issues. The Bill and Melinda Gates Foundation pioneered a philanthropy model that sought not to just give money away but to get meaningful results.
The by-product of “effective altruism” or “active philanthropy’ now practiced by BMGF, The Arnold Foundation and, rather poorly, Sam Bankman-Fried, has been a blurring of lines of philanthropy and market capitalism.
The single biggest beneficiary of pandemic preparedness has been pharmaceutical companies like PFE, BNTX and MRNA, and others who have vigorously explored vaccine programs with some philanthropic support from BMGF and reduced legal liability threat thanks to the PREP Act.
Recently, a group of 70 Africa-based agriculture organizations took public issue with Bill Gates program to fund the development of fertilizers and genetically modified seeds to defend the continent against starvation in the face of climate change.
The Arnold Foundation, with fewer resources at its disposal, uses a strategy of funding academic research to influence public policy. They, among others, funded research at Yale that was influential in the press coverage of “surprise bills” that influenced the soon-to-be-hated No Surprises Act.
The strategies are different, but the results are similar in that they alter the economics of certain industries. The Arnolds have taken aim at private equity investments. The BMGF is opening new markets in vaccine development and agriculture.
As for Mr. Bankman-Fried, well, his effort died aborning with ill-advised program to influence American elections. There is no doubt more to that story and we shall wait for it to be told.
The warning through the ages holds. Beware of Greeks or software engineers or math wizzes bearing gifts.
Have a great rest of your weekend.
Emily Evans
Managing Director – Health Policy
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