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Effective Altruism Is Bunk, Crypto Is Bad for the Planet, and Other Basic Truths of the FTX Crash

News Feed
Friday, November 18, 2022

Twitter’s implosion isn’t the only astonishing story in the tech world this week. There’s also the collapse of FTX, a cryptocurrency exchange led by its 30-year-old founder Sam Bankman-Fried, who is now under investigation by federal regulators for multiple wrongdoings and, by the public, for reportedly being a member of what may now be world’s most despised polycule. What’s made the FTX unraveling so shocking is that Bankman-Fried was thought to be special—the reasonable voice of a Wild West industry. He was also believed to be in possession of a moral compass. Now, as headlines about FTX proliferate, people are starting to question the philosophy of “effective altruism,” which Bankman-Fried promoted and claimed to live by. This rethinking of effective altruism may be the one bright spot in an otherwise depressing crash that may devastate many vulnerable people. Despite its good reputation in some affluent and influential quarters, the effective altruism philosophy has always contained quite a bit of dangerous nonsense.  The goal of effective altruism—a philosophy and “social movement”—is to “try to find unusually good ways of helping, such that a given amount of effort goes an unusually long way,” according to EffectiveAltruism.org. That can mean donating a kidney, spending money on pandemic preparedness, or attempting to ward off space crimes in the year 3423. The actions of effective altruism devotees are guided by a few core principles, including prioritization. “The goal is to find the best ways to help, rather than just working to make any difference at all” using “numbers,” the group’s website states. Decisions should be impartial so as to “give everyone’s interests equal weight.” Adherents are committed to open truth-seeking, finding the most rational ways to make change rather than “starting with a commitment to a certain cause, community or approach.” EA acolytes pride themselves, that is, on a cool rationality that rejects the emotional satisfaction of helping someone face to face, or having the kinds of material or emotional stakes in an issue that organizers use to enlist recruits into union drives or grassroots movements pushing systemic change. It’s that reasoning which leads the EA-career advice site 80,000 Hours—featuring a testimonial from Bankman-Fried himself—to rank climate change seventh on a list of the world’s most pressing problems. Climate change, this site claims, is dangerous mainly for its potential to exacerbate other, more grave existential threats like pandemic or nuclear war. The case for that is as follows: “If climate change poses something like a 1 in 1,000,000 risk of extinction by itself, our guess is that its contribution to other existential risks is at most a few orders of magnitude higher—so something like 1 in 10,000.” Numbers! The most pressing threat, this site claims, is superpowered artificial intelligence at some point executing a plan to kill or enslave all of humanity.The most pressing threat, this site claims, is superpowered artificial intelligence at some point executing a plan to kill or enslave all of humanity. The unlikely event of the world warming by 13 degrees would constitute “a humanitarian disaster of unprecedented scale,” per an 80,000 Hours issue brief. But even at those temperatures ”it seems very likely that we could adapt to avoid extinction (for example, by building better buildings and widespread air conditioning, as well as building more in the cooler areas of the Earth),” the guide writes. “​​We would have to live in a much smaller area, but civilisation would survive.”Effective Altruism’s intellectual grandfather is utilitarian Peter Singer. But its best hype man is Oxford philosopher William MacAskill. His particular hobby horse is something called longtermism, spelled out in his latest book What We Owe The Future. As Alexander Zaitchek summarized in his excellent review for this magazine, longtermism “posits that one’s highest ethical duty in the present is to increase the odds, however slightly, of humanity’s long-term survival and the colonization of the Virgo supercluster of galaxies by our distant descendants.” Our chief concern should be the trillions of people who’ll live on earth for hundreds of thousands, if not billions of years to come. Oddly, the rationale for climate change not being a more pressing threat to EAs is that it would take “some time (decades or maybe centuries)” for extreme levels of warming to develop via the burning every fossil fuel reserve currently in the ground. MacAskill, who seems to have personally recruited Bankman-Fried to the EA community, has now condemned Bankman-Fried on Twitter for failing at effective altruism. “I had put my trust in Sam, and if he lied and misused customer funds he betrayed me, just as he betrayed his customers, his employees, his investors, & the communities he was a part of,” MacAskill tweeted last week. To demonstrate that Bankman-Fried’s actions were inconsistent with effective altruism and therefore Bankman-Fried’s fall does not discredit effective altruism, MacAskill posted a few sections from his book that emphasize the need to live a “rounded ethical life.” The ends do not always justify the means, MacAskill argues in these segments, even if it might theoretically save billions of lives in the far-off future. And it’s “particularly important to avoid doing harm,” he writes. But like much of EA, this sidesteps some more basic ethical issues under capitalism—issues highly relevant to the FTX collapse. Quite simply: There is no ethical or non-harmful way to make a billion dollars in an economic system rife with—and arguably premised on—exploitation and passing the true costs of a product on to others. To MacAskill, creating a Ponzi scheme and gambling away customer savings is beyond the pale. The ordinary exploitation involved in the process of accumulating extraordinary wealth—low wages, poor working conditions, and union busting—is all copacetic. In the case of crypto, especially, amassing wealth has tended to come with a massive carbon footprint. Bitcoin mining using so-called proof of work operations are extraordinarily carbon intensive. Shuttered coal and gas-fired power plants in the U.S. have surged back to life to mint cryptocurrency, sparking pushback from lawmakers in New York and elsewhere. The practice uses more electricity than the country of Norway and its 5.3 million inhabitants. Attempts to switch to another, much less emissions-intensive method called proof of stake have so far been a mixed bag. While Ethereum underwent a high-profile switch, old mining devices are still being put to work. Though pollution from fossil fuels account for one in five deaths worldwide, EA enthusiasts could undoubtedly offer a lengthy explanation as to why more emissions are ultimately justified in the name of battling intergalactic genocide. Effective altruism is the gospel of wealth for guys who fashioned their personalities in high school around subjecting their criminally underpaid teachers to debates about whether God exists.Effective altruism is the gospel of wealth for guys who fashioned their personalities in high school around subjecting their criminally underpaid teachers to debates about whether God exists. The implicit reasoning behind the philosophy is that the big, powerful brains earning fortunes are also the best equipped to figure out how they will make the world a better place. Any rube can go work at a non-profit. Making a real difference might just mean getting filthy rich (“earning to give”), as MacAskill once told Bankman-Friend over lunch. “Rich makes right” is not exactly revolutionary stuff. “Doing good by doing well” has been a long-held mantra of Davos-types spewing TED talk-ish bromides about wanting to make the world a better, greener place. “The laws of accumulation will be left free; the laws of distribution free. Individualism will continue,” steel magnate Andrew Carnegie wrote of his class’s charitable giving in 1899, “but the millionaire will be but a trustee for the poor; entrusted for a season with a great part of the increased wealth of the community, but administering it for the community far better than it could or would have done for itself.” Bizarrely, though, EA has been successfully marketed as new and innovative, mostly by dint of its proximity to tech. To be fair, EA-aligned think tanks like Open Philanthropy have sent money to plenty of worthy causes, including journalism and non-profits interested in tackling the root causes of what makes the world suck. Some EA adherents are merely self-congratulatory do-gooders. Some are people who have landed themselves in high paying jobs, yet have some vague sense that the world is bad and want to help out. Donating kidneys and mosquito netting isn’t exactly a bad thing. There may well be some way for EA to continue the good it’s doing in the world without Bankman-Friend and other wealthy backers. But on a basic material level, crypto and the institutions guiding EA remain deeply intertwined—so much so that many recipients of EA funds are now facing dire shortfalls amid the FTX implosion. Bankman-Friend more or less admitted this week that his ethical commitments were mostly a scam. When prompted by Vox’s Kelsey Piper over Twitter DMs to discuss the discrepancy between his public talk about ethics and his true perception of finance as a “game,” he responded, “ya,” and “hehe,” adding that he “had to be” good at talking about ethics since “it’s what reputations are made of.” Ethics in corporate culture, he added, is “a dumb game that we woke westerners play where we say all the right shiboleths and so everyone likes us.”As he also told Piper, “fuck regulators.” Any talk about wanting to make good regulations on crypto was “just PR,” he confirmed. To him, regulators are useless, inept drains on businesses. Regulators are obsessed with a “giant Crackdown on Big Tech,” and are “undermining US interests globally.” He called the Office of Foreign Assets Control—the enforcement arm of the U.S. Treasury, which also administers trade sanctions—“the single biggest threat to the US being a suprepower.” Echoing the Republicans who have deemed so-called environmental, social, and corporate governance (ESG) investment decisions a special enemy in recent years, on the theory that Wall Street banks are biased against fossil fuels, Bankman-Fried complained that “ESG has been perverted beyond recognition.” Reading this rant over Twitter DMs, it’s hard to avoid the conclusion that the effective altruism philosophy Bankman-Fried claimed to believe in is beside the point: Bankman-Fried is a garden-variety reactionary who wants to keep the government out of his business. Debating whether or not he did all this to serve some greater good is academic, leaning toward absurd.It was already clear beore the FTX implosion was Bankman-Fried spent plenty of money not to make the world a better place, but to influence policymakers, quickly becoming one of the largest donors to Democratic candidates. He gave $5 million to Joe Biden’s presidential campaign, and had pledged to put $1 billion toward supporting Democrats in 2024. This probably wasn’t because he’s a progressive at heart: Reporting by The American Prospect found that two Democratic-supporting political action committees funded by Bankman-Fried, Web3 Forward and GMI PAC, backed candidates based on how friendly they would be to the crypto industry—including on its considerable greenhouse gas emissions. These PACs sent questionnaires to candidates on these issues. As David Dayen writes: A section in one questionnaire labeled “Protecting the Environment” claims that Bitcoin “proof of work” mining, which has been criticized for using extreme amounts of energy, is actually a boost to a clean-energy electric grid, while using “2.5 times less energy than the banking system per dollar of value.” The Prospect asked Web3 Forward and GMI PAC to provide sources for this, but they have not responded. As the questionnaire even concedes at one point, the arguments appear to be based on theories from proof-of-work mining participants themselves. Independent energy experts have scoffed at the claims.Questionnaires also asked candidates to pledge to support a letter to SEC Commissioner Gary Gensler urging him to back off the industry. The letter was ultimately signed by both Republicans and Democrats, including Representatives Josh Gottheimer, Jake Auchincloss, Darren Soto and Ritchie Torres.  As The Lever reported, the Bankman-Fried-backed super PAC Protect Our Future spent millions this cycle, including to elect candidates who sit on committees relevant to the crypto industry. Bankman-Fried personally co-hosted a fundraiser for Torres with Democrat-aligned pollsters David Shor and Sean McElwee. The latter was reportedly an advisor to Bankman-Fried, whose group Data for Progress received $48,000 from Protect Our Future.  This is all very ordinary behavior for a billionaire getting involved in politics. Real or fake, the sheen of effective altruism seemed to have fooled plenty of people into thinking Bankman-Fried was extraordinary. It’s good that FTX’s collapse is finally making people rethink Bankman-Fried and effective altruism. But the problem with effective altruism isn’t that it’s populated by insufferable dweebs. The problem is these dweebs’ alliance with a profoundly anti-democratic project: to let its founders continue to make as much money as possible, whatever the cost to people and the planet. 

Twitter’s implosion isn’t the only astonishing story in the tech world this week. There’s also the collapse of FTX, a cryptocurrency exchange led by its 30-year-old founder Sam Bankman-Fried, who is now under investigation by federal regulators for multiple wrongdoings and, by the public, for reportedly being a member of what may now be world’s most despised polycule. What’s made the FTX unraveling so shocking is that Bankman-Fried was thought to be special—the reasonable voice of a Wild West industry. He was also believed to be in possession of a moral compass. Now, as headlines about FTX proliferate, people are starting to question the philosophy of “effective altruism,” which Bankman-Fried promoted and claimed to live by. This rethinking of effective altruism may be the one bright spot in an otherwise depressing crash that may devastate many vulnerable people. Despite its good reputation in some affluent and influential quarters, the effective altruism philosophy has always contained quite a bit of dangerous nonsense.  The goal of effective altruism—a philosophy and “social movement”—is to “try to find unusually good ways of helping, such that a given amount of effort goes an unusually long way,” according to EffectiveAltruism.org. That can mean donating a kidney, spending money on pandemic preparedness, or attempting to ward off space crimes in the year 3423. The actions of effective altruism devotees are guided by a few core principles, including prioritization. “The goal is to find the best ways to help, rather than just working to make any difference at all” using “numbers,” the group’s website states. Decisions should be impartial so as to “give everyone’s interests equal weight.” Adherents are committed to open truth-seeking, finding the most rational ways to make change rather than “starting with a commitment to a certain cause, community or approach.” EA acolytes pride themselves, that is, on a cool rationality that rejects the emotional satisfaction of helping someone face to face, or having the kinds of material or emotional stakes in an issue that organizers use to enlist recruits into union drives or grassroots movements pushing systemic change. It’s that reasoning which leads the EA-career advice site 80,000 Hours—featuring a testimonial from Bankman-Fried himself—to rank climate change seventh on a list of the world’s most pressing problems. Climate change, this site claims, is dangerous mainly for its potential to exacerbate other, more grave existential threats like pandemic or nuclear war. The case for that is as follows: “If climate change poses something like a 1 in 1,000,000 risk of extinction by itself, our guess is that its contribution to other existential risks is at most a few orders of magnitude higher—so something like 1 in 10,000.” Numbers! The most pressing threat, this site claims, is superpowered artificial intelligence at some point executing a plan to kill or enslave all of humanity.The most pressing threat, this site claims, is superpowered artificial intelligence at some point executing a plan to kill or enslave all of humanity. The unlikely event of the world warming by 13 degrees would constitute “a humanitarian disaster of unprecedented scale,” per an 80,000 Hours issue brief. But even at those temperatures ”it seems very likely that we could adapt to avoid extinction (for example, by building better buildings and widespread air conditioning, as well as building more in the cooler areas of the Earth),” the guide writes. “​​We would have to live in a much smaller area, but civilisation would survive.”Effective Altruism’s intellectual grandfather is utilitarian Peter Singer. But its best hype man is Oxford philosopher William MacAskill. His particular hobby horse is something called longtermism, spelled out in his latest book What We Owe The Future. As Alexander Zaitchek summarized in his excellent review for this magazine, longtermism “posits that one’s highest ethical duty in the present is to increase the odds, however slightly, of humanity’s long-term survival and the colonization of the Virgo supercluster of galaxies by our distant descendants.” Our chief concern should be the trillions of people who’ll live on earth for hundreds of thousands, if not billions of years to come. Oddly, the rationale for climate change not being a more pressing threat to EAs is that it would take “some time (decades or maybe centuries)” for extreme levels of warming to develop via the burning every fossil fuel reserve currently in the ground. MacAskill, who seems to have personally recruited Bankman-Fried to the EA community, has now condemned Bankman-Fried on Twitter for failing at effective altruism. “I had put my trust in Sam, and if he lied and misused customer funds he betrayed me, just as he betrayed his customers, his employees, his investors, & the communities he was a part of,” MacAskill tweeted last week. To demonstrate that Bankman-Fried’s actions were inconsistent with effective altruism and therefore Bankman-Fried’s fall does not discredit effective altruism, MacAskill posted a few sections from his book that emphasize the need to live a “rounded ethical life.” The ends do not always justify the means, MacAskill argues in these segments, even if it might theoretically save billions of lives in the far-off future. And it’s “particularly important to avoid doing harm,” he writes. But like much of EA, this sidesteps some more basic ethical issues under capitalism—issues highly relevant to the FTX collapse. Quite simply: There is no ethical or non-harmful way to make a billion dollars in an economic system rife with—and arguably premised on—exploitation and passing the true costs of a product on to others. To MacAskill, creating a Ponzi scheme and gambling away customer savings is beyond the pale. The ordinary exploitation involved in the process of accumulating extraordinary wealth—low wages, poor working conditions, and union busting—is all copacetic. In the case of crypto, especially, amassing wealth has tended to come with a massive carbon footprint. Bitcoin mining using so-called proof of work operations are extraordinarily carbon intensive. Shuttered coal and gas-fired power plants in the U.S. have surged back to life to mint cryptocurrency, sparking pushback from lawmakers in New York and elsewhere. The practice uses more electricity than the country of Norway and its 5.3 million inhabitants. Attempts to switch to another, much less emissions-intensive method called proof of stake have so far been a mixed bag. While Ethereum underwent a high-profile switch, old mining devices are still being put to work. Though pollution from fossil fuels account for one in five deaths worldwide, EA enthusiasts could undoubtedly offer a lengthy explanation as to why more emissions are ultimately justified in the name of battling intergalactic genocide. Effective altruism is the gospel of wealth for guys who fashioned their personalities in high school around subjecting their criminally underpaid teachers to debates about whether God exists.Effective altruism is the gospel of wealth for guys who fashioned their personalities in high school around subjecting their criminally underpaid teachers to debates about whether God exists. The implicit reasoning behind the philosophy is that the big, powerful brains earning fortunes are also the best equipped to figure out how they will make the world a better place. Any rube can go work at a non-profit. Making a real difference might just mean getting filthy rich (“earning to give”), as MacAskill once told Bankman-Friend over lunch. “Rich makes right” is not exactly revolutionary stuff. “Doing good by doing well” has been a long-held mantra of Davos-types spewing TED talk-ish bromides about wanting to make the world a better, greener place. “The laws of accumulation will be left free; the laws of distribution free. Individualism will continue,” steel magnate Andrew Carnegie wrote of his class’s charitable giving in 1899, “but the millionaire will be but a trustee for the poor; entrusted for a season with a great part of the increased wealth of the community, but administering it for the community far better than it could or would have done for itself.” Bizarrely, though, EA has been successfully marketed as new and innovative, mostly by dint of its proximity to tech. To be fair, EA-aligned think tanks like Open Philanthropy have sent money to plenty of worthy causes, including journalism and non-profits interested in tackling the root causes of what makes the world suck. Some EA adherents are merely self-congratulatory do-gooders. Some are people who have landed themselves in high paying jobs, yet have some vague sense that the world is bad and want to help out. Donating kidneys and mosquito netting isn’t exactly a bad thing. There may well be some way for EA to continue the good it’s doing in the world without Bankman-Friend and other wealthy backers. But on a basic material level, crypto and the institutions guiding EA remain deeply intertwined—so much so that many recipients of EA funds are now facing dire shortfalls amid the FTX implosion. Bankman-Friend more or less admitted this week that his ethical commitments were mostly a scam. When prompted by Vox’s Kelsey Piper over Twitter DMs to discuss the discrepancy between his public talk about ethics and his true perception of finance as a “game,” he responded, “ya,” and “hehe,” adding that he “had to be” good at talking about ethics since “it’s what reputations are made of.” Ethics in corporate culture, he added, is “a dumb game that we woke westerners play where we say all the right shiboleths and so everyone likes us.”As he also told Piper, “fuck regulators.” Any talk about wanting to make good regulations on crypto was “just PR,” he confirmed. To him, regulators are useless, inept drains on businesses. Regulators are obsessed with a “giant Crackdown on Big Tech,” and are “undermining US interests globally.” He called the Office of Foreign Assets Control—the enforcement arm of the U.S. Treasury, which also administers trade sanctions—“the single biggest threat to the US being a suprepower.” Echoing the Republicans who have deemed so-called environmental, social, and corporate governance (ESG) investment decisions a special enemy in recent years, on the theory that Wall Street banks are biased against fossil fuels, Bankman-Fried complained that “ESG has been perverted beyond recognition.” Reading this rant over Twitter DMs, it’s hard to avoid the conclusion that the effective altruism philosophy Bankman-Fried claimed to believe in is beside the point: Bankman-Fried is a garden-variety reactionary who wants to keep the government out of his business. Debating whether or not he did all this to serve some greater good is academic, leaning toward absurd.It was already clear beore the FTX implosion was Bankman-Fried spent plenty of money not to make the world a better place, but to influence policymakers, quickly becoming one of the largest donors to Democratic candidates. He gave $5 million to Joe Biden’s presidential campaign, and had pledged to put $1 billion toward supporting Democrats in 2024. This probably wasn’t because he’s a progressive at heart: Reporting by The American Prospect found that two Democratic-supporting political action committees funded by Bankman-Fried, Web3 Forward and GMI PAC, backed candidates based on how friendly they would be to the crypto industry—including on its considerable greenhouse gas emissions. These PACs sent questionnaires to candidates on these issues. As David Dayen writes: A section in one questionnaire labeled “Protecting the Environment” claims that Bitcoin “proof of work” mining, which has been criticized for using extreme amounts of energy, is actually a boost to a clean-energy electric grid, while using “2.5 times less energy than the banking system per dollar of value.” The Prospect asked Web3 Forward and GMI PAC to provide sources for this, but they have not responded. As the questionnaire even concedes at one point, the arguments appear to be based on theories from proof-of-work mining participants themselves. Independent energy experts have scoffed at the claims.Questionnaires also asked candidates to pledge to support a letter to SEC Commissioner Gary Gensler urging him to back off the industry. The letter was ultimately signed by both Republicans and Democrats, including Representatives Josh Gottheimer, Jake Auchincloss, Darren Soto and Ritchie Torres.  As The Lever reported, the Bankman-Fried-backed super PAC Protect Our Future spent millions this cycle, including to elect candidates who sit on committees relevant to the crypto industry. Bankman-Fried personally co-hosted a fundraiser for Torres with Democrat-aligned pollsters David Shor and Sean McElwee. The latter was reportedly an advisor to Bankman-Fried, whose group Data for Progress received $48,000 from Protect Our Future.  This is all very ordinary behavior for a billionaire getting involved in politics. Real or fake, the sheen of effective altruism seemed to have fooled plenty of people into thinking Bankman-Fried was extraordinary. It’s good that FTX’s collapse is finally making people rethink Bankman-Fried and effective altruism. But the problem with effective altruism isn’t that it’s populated by insufferable dweebs. The problem is these dweebs’ alliance with a profoundly anti-democratic project: to let its founders continue to make as much money as possible, whatever the cost to people and the planet. 

Twitter’s implosion isn’t the only astonishing story in the tech world this week. There’s also the collapse of FTX, a cryptocurrency exchange led by its 30-year-old founder Sam Bankman-Fried, who is now under investigation by federal regulators for multiple wrongdoings and, by the public, for reportedly being a member of what may now be world’s most despised polycule. What’s made the FTX unraveling so shocking is that Bankman-Fried was thought to be special—the reasonable voice of a Wild West industry. He was also believed to be in possession of a moral compass. Now, as headlines about FTX proliferate, people are starting to question the philosophy of “effective altruism,” which Bankman-Fried promoted and claimed to live by. This rethinking of effective altruism may be the one bright spot in an otherwise depressing crash that may devastate many vulnerable people. Despite its good reputation in some affluent and influential quarters, the effective altruism philosophy has always contained quite a bit of dangerous nonsense.  

The goal of effective altruism—a philosophy and “social movement”—is to “try to find unusually good ways of helping, such that a given amount of effort goes an unusually long way,” according to EffectiveAltruism.org. That can mean donating a kidney, spending money on pandemic preparedness, or attempting to ward off space crimes in the year 3423. The actions of effective altruism devotees are guided by a few core principles, including prioritization. “The goal is to find the best ways to help, rather than just working to make any difference at all” using “numbers,” the group’s website states. Decisions should be impartial so as to “give everyone’s interests equal weight.” Adherents are committed to open truth-seeking, finding the most rational ways to make change rather than “starting with a commitment to a certain cause, community or approach.” EA acolytes pride themselves, that is, on a cool rationality that rejects the emotional satisfaction of helping someone face to face, or having the kinds of material or emotional stakes in an issue that organizers use to enlist recruits into union drives or grassroots movements pushing systemic change. 

It’s that reasoning which leads the EA-career advice site 80,000 Hours—featuring a testimonial from Bankman-Fried himself—to rank climate change seventh on a list of the world’s most pressing problems. Climate change, this site claims, is dangerous mainly for its potential to exacerbate other, more grave existential threats like pandemic or nuclear war. The case for that is as follows: “If climate change poses something like a 1 in 1,000,000 risk of extinction by itself, our guess is that its contribution to other existential risks is at most a few orders of magnitude higher—so something like 1 in 10,000.” Numbers! 

The most pressing threat, this site claims, is superpowered artificial intelligence at some point executing a plan to kill or enslave all of humanity. The unlikely event of the world warming by 13 degrees would constitute “a humanitarian disaster of unprecedented scale,” per an 80,000 Hours issue brief. But even at those temperatures ”it seems very likely that we could adapt to avoid extinction (for example, by building better buildings and widespread air conditioning, as well as building more in the cooler areas of the Earth),” the guide writes. “​​We would have to live in a much smaller area, but civilisation would survive.”

Effective Altruism’s intellectual grandfather is utilitarian Peter Singer. But its best hype man is Oxford philosopher William MacAskill. His particular hobby horse is something called longtermism, spelled out in his latest book What We Owe The Future. As Alexander Zaitchek summarized in his excellent review for this magazine, longtermism “posits that one’s highest ethical duty in the present is to increase the odds, however slightly, of humanity’s long-term survival and the colonization of the Virgo supercluster of galaxies by our distant descendants.” Our chief concern should be the trillions of people who’ll live on earth for hundreds of thousands, if not billions of years to come. Oddly, the rationale for climate change not being a more pressing threat to EAs is that it would take “some time (decades or maybe centuries)” for extreme levels of warming to develop via the burning every fossil fuel reserve currently in the ground. 

MacAskill, who seems to have personally recruited Bankman-Fried to the EA community, has now condemned Bankman-Fried on Twitter for failing at effective altruism. “I had put my trust in Sam, and if he lied and misused customer funds he betrayed me, just as he betrayed his customers, his employees, his investors, & the communities he was a part of,” MacAskill tweeted last week. To demonstrate that Bankman-Fried’s actions were inconsistent with effective altruism and therefore Bankman-Fried’s fall does not discredit effective altruism, MacAskill posted a few sections from his book that emphasize the need to live a “rounded ethical life.” The ends do not always justify the means, MacAskill argues in these segments, even if it might theoretically save billions of lives in the far-off future. And it’s “particularly important to avoid doing harm,” he writes. 

But like much of EA, this sidesteps some more basic ethical issues under capitalism—issues highly relevant to the FTX collapse. Quite simply: There is no ethical or non-harmful way to make a billion dollars in an economic system rife with—and arguably premised on—exploitation and passing the true costs of a product on to others. To MacAskill, creating a Ponzi scheme and gambling away customer savings is beyond the pale. The ordinary exploitation involved in the process of accumulating extraordinary wealth—low wages, poor working conditions, and union busting—is all copacetic. 

In the case of crypto, especially, amassing wealth has tended to come with a massive carbon footprint. Bitcoin mining using so-called proof of work operations are extraordinarily carbon intensive. Shuttered coal and gas-fired power plants in the U.S. have surged back to life to mint cryptocurrency, sparking pushback from lawmakers in New York and elsewhere. The practice uses more electricity than the country of Norway and its 5.3 million inhabitants. Attempts to switch to another, much less emissions-intensive method called proof of stake have so far been a mixed bag. While Ethereum underwent a high-profile switch, old mining devices are still being put to work. Though pollution from fossil fuels account for one in five deaths worldwide, EA enthusiasts could undoubtedly offer a lengthy explanation as to why more emissions are ultimately justified in the name of battling intergalactic genocide. 

Effective altruism is the gospel of wealth for guys who fashioned their personalities in high school around subjecting their criminally underpaid teachers to debates about whether God exists. The implicit reasoning behind the philosophy is that the big, powerful brains earning fortunes are also the best equipped to figure out how they will make the world a better place. Any rube can go work at a non-profit. Making a real difference might just mean getting filthy rich (“earning to give”), as MacAskill once told Bankman-Friend over lunch. 

“Rich makes right” is not exactly revolutionary stuff. “Doing good by doing well” has been a long-held mantra of Davos-types spewing TED talk-ish bromides about wanting to make the world a better, greener place. “The laws of accumulation will be left free; the laws of distribution free. Individualism will continue,” steel magnate Andrew Carnegie wrote of his class’s charitable giving in 1899, “but the millionaire will be but a trustee for the poor; entrusted for a season with a great part of the increased wealth of the community, but administering it for the community far better than it could or would have done for itself.” Bizarrely, though, EA has been successfully marketed as new and innovative, mostly by dint of its proximity to tech. 

To be fair, EA-aligned think tanks like Open Philanthropy have sent money to plenty of worthy causes, including journalism and non-profits interested in tackling the root causes of what makes the world suck. Some EA adherents are merely self-congratulatory do-gooders. Some are people who have landed themselves in high paying jobs, yet have some vague sense that the world is bad and want to help out. Donating kidneys and mosquito netting isn’t exactly a bad thing. There may well be some way for EA to continue the good it’s doing in the world without Bankman-Friend and other wealthy backers. But on a basic material level, crypto and the institutions guiding EA remain deeply intertwined—so much so that many recipients of EA funds are now facing dire shortfalls amid the FTX implosion. 

Bankman-Friend more or less admitted this week that his ethical commitments were mostly a scam. When prompted by Vox’s Kelsey Piper over Twitter DMs to discuss the discrepancy between his public talk about ethics and his true perception of finance as a “game,” he responded, “ya,” and “hehe,” adding that he “had to be” good at talking about ethics since “it’s what reputations are made of.” Ethics in corporate culture, he added, is “a dumb game that we woke westerners play where we say all the right shiboleths and so everyone likes us.”

As he also told Piper, “fuck regulators.” Any talk about wanting to make good regulations on crypto was “just PR,” he confirmed. To him, regulators are useless, inept drains on businesses. Regulators are obsessed with a “giant Crackdown on Big Tech,” and are “undermining US interests globally.” He called the Office of Foreign Assets Control—the enforcement arm of the U.S. Treasury, which also administers trade sanctions—“the single biggest threat to the US being a suprepower.” Echoing the Republicans who have deemed so-called environmental, social, and corporate governance (ESG) investment decisions a special enemy in recent years, on the theory that Wall Street banks are biased against fossil fuels, Bankman-Fried complained that “ESG has been perverted beyond recognition.” 

Reading this rant over Twitter DMs, it’s hard to avoid the conclusion that the effective altruism philosophy Bankman-Fried claimed to believe in is beside the point: Bankman-Fried is a garden-variety reactionary who wants to keep the government out of his business. Debating whether or not he did all this to serve some greater good is academic, leaning toward absurd.

It was already clear beore the FTX implosion was Bankman-Fried spent plenty of money not to make the world a better place, but to influence policymakers, quickly becoming one of the largest donors to Democratic candidates. He gave $5 million to Joe Biden’s presidential campaign, and had pledged to put $1 billion toward supporting Democrats in 2024. This probably wasn’t because he’s a progressive at heart: Reporting by The American Prospect found that two Democratic-supporting political action committees funded by Bankman-Fried, Web3 Forward and GMI PAC, backed candidates based on how friendly they would be to the crypto industry—including on its considerable greenhouse gas emissions. These PACs sent questionnaires to candidates on these issues. As David Dayen writes: 

A section in one questionnaire labeled “Protecting the Environment” claims that Bitcoin “proof of work” mining, which has been criticized for using extreme amounts of energy, is actually a boost to a clean-energy electric grid, while using “2.5 times less energy than the banking system per dollar of value.” 

The Prospect asked Web3 Forward and GMI PAC to provide sources for this, but they have not responded. As the questionnaire even concedes at one point, the arguments appear to be based on theories from proof-of-work mining participants themselves. Independent energy experts have scoffed at the claims.

Questionnaires also asked candidates to pledge to support a letter to SEC Commissioner Gary Gensler urging him to back off the industry. The letter was ultimately signed by both Republicans and Democrats, including Representatives Josh Gottheimer, Jake Auchincloss, Darren Soto and Ritchie Torres.  As The Lever reported, the Bankman-Fried-backed super PAC Protect Our Future spent millions this cycle, including to elect candidates who sit on committees relevant to the crypto industry. Bankman-Fried personally co-hosted a fundraiser for Torres with Democrat-aligned pollsters David Shor and Sean McElwee. The latter was reportedly an advisor to Bankman-Fried, whose group Data for Progress received $48,000 from Protect Our Future.  This is all very ordinary behavior for a billionaire getting involved in politics. Real or fake, the sheen of effective altruism seemed to have fooled plenty of people into thinking Bankman-Fried was extraordinary

It’s good that FTX’s collapse is finally making people rethink Bankman-Fried and effective altruism. But the problem with effective altruism isn’t that it’s populated by insufferable dweebs. The problem is these dweebs’ alliance with a profoundly anti-democratic project: to let its founders continue to make as much money as possible, whatever the cost to people and the planet. 

Read the full story here.
Photos courtesy of

Who turned out the lights? Los Angeles-area landmarks go dark in observance of Earth Hour

Lighting at some local Los Angeles landmarks will go dark from 8:30 to 9:30 p.m. Saturday in observance of Earth Hour, an annual event promoted by the World Wildlife Foundation.

The famed Pacific Wheel at Santa Monica Pier and the glowing Gateway Pylons at Los Angeles International Airport are just a couple of the local landmarks that will go dark Saturday night in observance of Earth Hour. “Tonight, LAX will temporarily turn off its iconic gateway pylons in observance of Earth Hour. The pylons will be lit green before going dark from 8:30 to 9:30 p.m. in unison with other city-owned buildings and famous landmarks across Los Angeles,” the airport posted on social media. Earth Hour, which began in Australia in 2007, is sponsored by the World Wildlife Fund. The event is intended to engage the public’s interest in matters involving global warming and to encourage individuals and businesses across the globe to dedicate an hour to activities benefiting Earth’s environment.The Ferris wheel at Santa Monica Pier, which bills itself as the world’s only solar-powered wheel, will turn off all but its wheel rim safety lights. The lights-off event can be viewed online at the Pacific Park website. “In an increasingly divided world, Earth Hour serves as a beacon of positivity, hope and inspiration to rally as many people as possible, in particular people who are not fully engaged with the environmental crisis yet,” read a statement from Pacific Park operators. Newsletter You're reading Boiling Point Sammy Roth gets you up to speed on climate change, energy and the environment. Sign up to get it in your inbox twice a week. You may occasionally receive promotional content from the Los Angeles Times.

Tightened fishing regulations: No pickled fish this Easter?

This year pickled fish may not be possible for many as there might be shortages of this delicacy amidst tightened fishing regulations. The post Tightened fishing regulations: No pickled fish this Easter? appeared first on SAPeople - Worldwide South African News.

Many South Africans follow a tradition of eating pickled fish or snoek over Easter. The tradition originated in Cape Town. This year, however, this may not be possible for many as there might be shortages of this delicacy amidst tightened fishing regulations. TIGHTENED REGULATIONS The Department of Forestry Fisheries and the Environment (DFFE) has tightened regulations on catch limits for small-scale fishers. In addition, traditional fishers are experiencing delays in permit processing and reductions in permitted boats, according to Biz Community. More recently, the DFFE enlisted the South African National Defence Force (SANDF) to inspect fishing vessels. This sparked concerns among fishers along the West Coast about meeting the demand for snoek over the Easter weekend. Maria Welcome, spokesperson for environmental society organisation Green Connection, said fishers along the West Coast were struggling with quotas to meet the demands of fish supply. “Snoek migration starts a cultural ritual that has been practiced for as long as fishers can remember. Eager consumers of snoek and partakers in the Easter weekend fish rituals and delicacies should be warned – the shelves and pantries may be empty this year,” she said. AFFECTED FISHERMEN Welcome said that the government informed many of the 62 newly formed fisheries co-operatives who only received their rights recently, of quota cuts. For many, this meant that more than half of their fishers will not be able to go to sea to catch snoek or any other traditional line fish. A small-scale fisherman from Port Nolloth, Walter Steenkamp, expressed his disagreement with the situation. He said that the government is trying to cut them out of the fishing industry, according to IOL. “We’re trying to make a business. The government must try to bring co-management in so that we can negotiate and sit around one table and put the regulations and everything on the table. We are suffering as small-scale fisheries. This government doesn’t care for us,” said Steenkamp. ALSO READ: Zuma loses court bid to remove Billy Downer from corruption trial The post Tightened fishing regulations: No pickled fish this Easter? appeared first on SAPeople - Worldwide South African News.

Honduras Ratchets Up Battle With Crypto-Libertarian Investors, Rejects World Bank Court

After the Honduran president repealed a law granting unfettered authority to outside investors, the cryptoquistadors took the dispute to a World Bank arbitration court. The post Honduras Ratchets Up Battle With Crypto-Libertarian Investors, Rejects World Bank Court appeared first on The Intercept.

A group of prominent international economists is applauding the recent move by Honduran President Xiomara Castro to push back against American crypto investors attempting to seize billions in public money from the Central American nation. The crypto crew is exploiting a dispute mechanism nested inside the World Bank, created by an obscure provision of the Central America Free Trade Agreement. Castro has deemed the forum, called the World Bank’s International Centre for Settlement of Investment Disputes, or ICSID, to be an illegitimate usurpation of Honduran sovereignty and has hit upon an elegant solution: She has taken steps to withdraw Honduras from ICSID. The crypto crowd is crying foul. The spectacular battle playing out in Honduras and inside global financial institutions blends the 19th-century American legacy of gunboat diplomacy and banana republicanism with a contemporary twist: The lead group of investors battling Honduras by exploiting international financial institutions is made up of a band of crypto-libertarians. The fight presents an almost-impossible-to-believe scenario: A group of libertarian investors teamed up with a former Honduran government — which was tied at the hip with narco-traffickers and came to power after a U.S.-backed military coup — in order to implement the world’s most radical libertarian policy, which turned over significant portions of the country to those investors through so-called special economic zones. The Honduran public, in a backlash, ousted the narco-backed regime, and the new government repealed the libertarian legislation. The crypto investors are now using the World Bank to force Honduras to honor the narco-government’s policies. Since Castro took office in 2021, the World Bank’s ICSID has seen investors bring no fewer than 10 cases targeting her government. The largest case, brought by U.S. corporation Próspera Inc., seeks more than $10 billion in compensation, which would equal roughly a third of the country’s GDP. Próspera, rooted in the world of crypto finance, describes itself as a “platform [that] powers the development of new cities in special economic zones that maximize generalized prosperity and wealth creation.” A city the company set up in Honduras accepts bitcoin as official tender. In an open letter published on Tuesday, the economists argued that Castro’s decision was a smart move. “We view the withdrawal as a critical defence of Honduran democracy and an important step toward its sustainable development,” reads the letter, which was organized by Progressive International, a left-leaning coalition. “For decades, international arbitration courts like ICSID have allowed corporations to sue states and restrict their freedom to regulate in favour of consumers, workers and the environment. Since 1996, governments in Latin America alone have been forced to compensate foreign corporations over $30 billion, intimidating regulators away from raising minimum wages, protecting vulnerable ecosystems, and introducing climate protections, among other domestic policy priorities. We find scant economic evidence that mechanisms like ICSID stimulate meaningful foreign direct investment, in return.” At issue are so-called ZEDEs created by previous governments of Honduras. The law that established ZEDEs — short for Zone for Employment and Economic Development — effectively carved out portions of Honduras and turned them over to American investors, who operate as effective sovereign governments. The ZEDEs could one day control 35 percent of Honduras’s territory, according to the United Nations, which has said that the zones raise human rights concerns. It took enormous political muscle more than a decade ago to force the ZEDEs into law. They only became possible when Castro’s husband, Manuel Zelaya, was removed in a U.S.-backed coup in 2009. After Zelaya was ousted, a new election brought in President Porfirio Lobo Sosa, who quickly moved to undo Zelaya’s social reforms, attacking workers rights and reneging on land reform efforts. The Supreme Court struck down the first version of the ZEDEs law as unconstitutional, but after the constitution was amended and four new justices were added to the Supreme Court, the law stuck in 2013. Lobo Sosa’s rise was fueled not just by U.S. support but also by narco-trafficker cash, according to U.S. prosecutors who convicted Tony Hernández, the brother of former President Juan Orlando Hernández, for trafficking “monumental” amounts of cocaine. Juan Orlando Hernández was Lobo Sosa’s successor and was himself convicted of drug trafficking earlier this month in a U.S. federal court. He was president of the National Congress, Honduras’s legislative body, from 2010 to 2013, and was a primary mover of the ZEDEs legislation. He also led the overnight takeover of the Supreme Court that enabled their implementation. Prosecutors in the Tony Hernández case linked the brothers with Lobo Sosa in their sentencing memorandum. “Between 2004 and 2019, the defendant secured and distributed millions of dollars in drug-derived bribes to Juan Orlando Hernandez, former Honduran President Porfirio Lobo Sosa and other politicians associated with Honduras’s National Party,” prosecutors wrote. So to put the ZEDEs in context: The radical “free market” intervention was only jammed into law as the result of a military coup and the stacking of the Supreme Court. The ZEDEs were then enacted and implemented for the benefit of U.S. investors by two narco-governors. On March 8, in celebrating the conviction of the former Honduran president who shepherded the law into being, and then oversaw its implementation, Attorney General Merrick Garland said that Hernández — a man propped up throughout his tenure by his allies in the State Department — oversaw “a narco-state where violent drug traffickers were allowed to operate with virtual impunity.” Zelaya was overthrown ostensibly over his attempt to extend his presidency to what was deemed an unconstitutional second term. Yet Hernández breezily ran for reelection in 2017 and claimed victory amid an absurd amount of irregularities, all of them brushed aside by a supportive Trump administration. The years of chaos and violence led to a surge of migration toward the U.S. border. The U.S. had no evident problem with that freewheeling narco-state while Hernandez was in office and remained useful, yet once Castro took power in a backlash to the U.S.-fueled corruption, the United States suddenly rediscovered its respect for the rule of law and the sanctity of contracts with U.S. investors. Castro quickly and successfully moved to repeal the ZEDEs law in the face of intense bipartisan U.S. pressure to maintain them. The American response has been to repudiate the very idea of Honduran democracy and sovereignty, with investors using the World Bank’s ICSID to force the new Honduran government to respect the policies carried out by the former president now sitting behind federal bars. Among the dozens of signatories to the Progressive International praising Castro’s decision to exit the arbitration court are prominent South Korean economist Ha-Joon Chang; Chilean Gabriel Palma, of the “Palma Ratio of inequality”; American economist Jeffrey Sachs; former Greek Finance Minister Yanis Varoufakis; British economist Ann Pettifor; and Indian development economist Jayati Ghosh. Melinda St. Louis, director of Public Citizen’s Global Trade Watch, has been fighting the crypto crew for years and welcomed Castro’s move. “The Honduran people overwhelmingly opposed the ZEDE law, and when the Honduran legislature unanimously repealed this law, that should have been the end of the story,” she said. “This is just the latest example of corporations abusing this ISDS mechanism to challenge environmental, health, land use, and other public interest policies around the hemisphere. Honduras was wise to withdraw from the World Bank venue where many of these cases are brought as an important first step.” In its case before the ICSID, Próspera retained a top lobbying firm, employing former Democratic lawmaker Kendrick Meek, to pressure Honduras to pay up. Last year, Sen. Elizabeth Warren, D-Mass., and Rep. Lloyd Doggett, D-Texas, came out against the effort by Próspera to exploit the dispute resolution system to undermine Honduran sovereignty. “In the case of Próspera,” they write, “a ZEDE located largely on the Honduran island of Roatán, investors have created a governing council where 44 percent of members are appointed by the private company and 22 percent are elected by landowners in a system where their number of votes is proportional to the size of their property.” A conference Próspera held on Roatán last year signaled the company’s ethic. “Próspera aims to be the best jurisdiction for the crypto/web3 industry in the world, and we welcome the best ideas on how to achieve that with a sound legal framework,” said Chris Wilson of Próspera in publicity materials that described the confab as “specifically designed for legal hackers, crypto lawyers, jurisdictional polymaths, and businesses that want to create better laws to do business under.” The company’s response to a request for comment on the letter from the economists was representative of the unusual corporate structure it has been able to implement. The company’s communications director told The Intercept that a response to our questions would be submitted by Jorge Colindres, representing the “Office of the Technical Secretary.” Colindres’s email signature alludes to the public-private nature of the corporation, reading: Jorge Constantino Colindres Technical Secretary – Próspera ZEDE Zona de Empleo y Desarrollo Económico República de Honduras Manager – General Service Provider Colindres responded as a government official. “Attached you will find my office’s statement on the unconstitutional withdrawal from ICSID by the Honduran government,” he said. His statement insisted: Próspera ZEDE is [a] local government and special economic zone of the Republic of Honduras. It is governed by the Technical Secretary, a Honduran citizen by birth, appointed by the Government of Honduras and empowered by article 329 of the Honduran Constitution and the ZEDE Organic Law to oversee the implementation of new policies and rules designed to foster economic development, facilitate job creation, attract national and foreign direct investment, and safeguard the fundamental rights of the workers and residents of this special jurisdiction. National and foreign companies alike are bound to comply with Próspera ZEDE Rules, which are Honduran rules, as they have been adopted by a local government of Honduras with the legal blessing of the country’s Executive Power, National Congress, and Supreme Court of Justice. Colindres claimed that the ZEDEs had resulted in more than $100 million in foreign investment so far, and that Castro had not gotten approval from the National Congress to withdraw from the World Bank’s dispute body. “We stand proud of our achievements in job creation and investment attraction, which run in stark contrast to the job killing policies of the national government, and we continue undeterred in our mission to transform the Honduran economy and catalyze prosperity through the oasis of economic freedom and rule of law that Próspera ZEDE offers to the Honduran people,” Colindres said. Fernando Garcia, a presidential commissioner appointed by Castro to oppose the ZEDEs, said that while the Honduran Constitution requires the National Congress to ratify new international treaties, it does not require the executive branch to notify the legislature ahead of a withdrawal. “The ICSID convention establishes the possibility of a sovereign state’s withdrawal from its convention,” Garcia told The Intercept. He added that the arbitration court has already legally accepted Honduras’s withdrawal, effective August. This does not, he said, “prevent those who have requested arbitration from proceeding in accordance.” The post Honduras Ratchets Up Battle With Crypto-Libertarian Investors, Rejects World Bank Court appeared first on The Intercept.

Connecticut wants to penalize insurers for backing fossil-fuel projects

A new bill could impose a fee on any company insuring a fossil-fuel project in the state.

The nation’s insurance industry has gone haywire in recent years amid a succession of floods, fires, and other climate-fueled disasters. These catastrophes have forced carriers to pay out billions in claims, and many have responded by raising premiums in disaster-prone states like Florida and Oregon or leaving certain markets altogether. But many of these companies also provide coverage for fossil fuel projects, like pipelines and natural gas power plants, that would never be built without their backing. This gives the insurance industry a unique role on both sides of the climate crisis: insurers are helping make the problem worse by underwriting the very projects that warm the earth even as they bear the costs of mounting climate disasters and pass them on to customers. Legislation in Connecticut, the capital of the American insurance industry and home to several of its largest carriers, could make insurers pay for that contradiction. If passed, the bill, which just cleared a committee vote in the state senate, would move toward imposing a fee for any fossil-fuel projects companies insure in state. That revenue would go into a public resilience fund that could underwrite sea walls and urban flood protection measures. “It’s important to begin to hold [insurers] accountable for how they’ve played it both ways in terms of climate change,” said Tom Swan, the executive director of Connecticut Citizen Action Group, an economic justice nonprofit that has joined several environmental organizations in lobbying the legislature to pass the bill along with several environmental organizations. “People are seeing skyrocketing rates, or they’re pulling out of different areas, and they continue to underwrite and invest in fossil fuels at a pace much greater than their colleagues across the globe,” he said.  The group pushed a more aggressive proposal last year that would have charged insurers a 5 percent fee for any fossil fuel coverage they issued in the United States, but that bill failed after critics raised several legal questions. In particular, the industry argued that the Constitution’s interstate commerce clause prohibits taxing a company’s out-of-state business. The new version, attached as an amendment to a climate resilience bill proposed by Democratic Governor Ned Lamont, would only require the state to produce a proposal for an insurance mechanism. The surcharge would apply only to fossil-fuel projects these companies insure in Connecticut, avoiding that constitutional challenge. The assessment would apply not only to new pipelines and fuel terminals, which require ample insurance to attract lenders and investors, but to current coverage for existing infrastructure as well. This means anyone covering the state’s dozens of oil- and gas-fueled power plants would be contributing to the resilience fund. A report from Connecticut Citizen Action Group and several other environmental nonprofits found that the state’s insurers have together invested $221 billion in fossil fuels. Supporters argue the reduced fee would still raise tens or hundreds of millions of dollars for climate resilience. Connecticut received about $318 million in FEMA disaster aid between 2011 and 2021, or about $149 in spending per capita, according to the climate adaptation nonprofit Rebuild by Design. That puts the state well below disaster-prone locales like Louisiana, which saw $1,736 in federal disaster aid per capita, but far above those like Delaware that haven’t experienced a major disaster in the past decade. Eric George, the president of the Insurance Association of Connecticut, the state’s largest insurance trade association, said the organization would “strongly oppose” any surcharge, but added that he was still studying the bill. The state’s insurance commissioner has testified in favor of the legislation, saying it has his department’s“full support.”  The legislation comes as other states, including Vermont and Maryland, introduce “polluters pay” bills to hold oil producers accountable for climate damages. Connecticut’s proposed law is an iteration of that effort focused on an area where state regulators wield significant influence, said Risalat Khan of the Sunrise Project, a nonprofit focused on energy transition policy.  “People are very directly seeing their premiums rise, in relation to climate disasters,” he said. “There’s a direct question there of, why aren’t state level regulators using more of their power to take local action?” The significance of this financing mechanism could vary from state to state, says Benjamin Keys, a professor of economics at the University of Pennsylvania and an expert on climate insurance risks.  “One major issue is that the fuels are collected and burned everywhere, but the pain of natural disasters is local in nature,” he said. Because of that, he questioned whether the financing mechanism “would be feasible for all communities to emulate, because many places have [lots of] disasters hit, but very little in the way of fossil fuel production.” Florida, for instance, doesn’t have much more fossil-fuel infrastructure than Connecticut, but faces extreme weather and other catastrophes far more often. Even though the legislation is weaker than the previous version, supporters say passing it in the home of the country’s insurance industry would send a message to big companies that are still underwriting oil and gas projects. “I think it’s a good policy, but from a narrative-setting perspective, it’s really important,” said Swan. This story was originally published by Grist with the headline Connecticut wants to penalize insurers for backing fossil-fuel projects on Mar 19, 2024.

Managing ‘Brown Gold:’ the Challenges—and Opportunities—of Spent Substrate

A version of this article originally appeared in The Deep Dish, our members-only newsletter. Become a member today and get the next issue directly in your inbox. The lumpy blocks are spent substrate, the living material left over after growing  mushrooms. Composed of sawdust and soy pellets woven through with mycelium—the thread-like aspect of the fungus from which mushrooms sprout—spent […] The post Managing ‘Brown Gold:’ the Challenges—and Opportunities—of Spent Substrate appeared first on Civil Eats.

A version of this article originally appeared in The Deep Dish, our members-only newsletter. Become a member today and get the next issue directly in your inbox. Collar City Mushrooms occupies a small building along the post-industrial waterfront of Troy, New York. Out back, baking in the winter sun between a shed and a yellow Volkswagen bus, sits a waist-high heap of what looks like dozens of giant Frosted Mini-Wheats, each roughly the size of a cinder block. The weathered caps of oyster mushrooms sprout defiantly from various points in the pile. The lumpy blocks are spent substrate, the living material left over after growing  mushrooms. Composed of sawdust and soy pellets woven through with mycelium—the thread-like aspect of the fungus from which mushrooms sprout—spent substrate is a unique kind of waste. It’s also one with many potential uses; it can be used as compost, as a means of decontaminating soil, as biofuel, and simply for growing more mushrooms. And while each of those uses could provide revenue potential for mushroom farms, the expanding piles of spent substrate also represent a mounting logistical challenge. “If you’re gonna do it, awesome, but account for this waste stream you’re producing and how you’re gonna get it off of your property.” “Right now, we have people picking it up almost as a favor for us, because otherwise what are we doing with it?” said Avery Stempel, Collar City’s co-founder, as we gazed upon the pile. Stempel currently takes most of the material to a nearby compost facility, but local farms, gardeners, and florists also take a portion. So do individuals, whether for compost in their gardens or just to grow mushrooms at home. “People will come and buy a bucket for five bucks,” Stempel said. Before it’s put to work growing mushrooms, substrate is carefully mixed and sterilized to maximize efficiency and prevent competition for the fungus. Protected inside breathable plastic bags, the sawdust and soy hulls are inoculated with an edible mushroom strain, then stacked on racks in climate-controlled rooms. The bags are sliced open when the mycelium is ready, and out sprouts the first “flush” of mushrooms. To make the best use of space, many farms will dispose of the blocks after a single flush, but each block is capable of several rounds of mushroom production. In this sense, the substrate isn’t really “spent.” Spent substrate waiting to be collected and reused. (Photo courtesy of Central Texas Mycological Society) Collar City is a relatively small operation, producing up to 1,000 pounds of mushrooms a week. An hour south, in Hillsdale, New York, Tivoli Mushrooms produces around 20,000 pounds per week, and it’s currently only using half the capacity of its new 15,000-square-foot facility. Soon after moving in, Co-founder Devon Gilroy reached out to a neighboring organic farm, offering the spent substrate for free as compost if they would simply take it off his hands. It wasn’t a tough sell. “They showed up like two weeks later with a tractor and a big truck to load it in,” he said. “They insisted on paying us for the substrate, which really helped.” More Mushrooms, More Problems From a revenue perspective, specialty mushroom substrate’s greatest value is currently as compost, which can sell for around $150 per cubic yard. It has a low pH level, useful in soils with low acidity, and a carbon-to-nitrogen ratio of roughly 40 to 1, which is close to ideal for building healthy soil. Spent substrate is also a useful addition to vermicompost—worms love to eat mycelium, and in doing, so they also break down woody debris and support soil biodiversity. It is also an excellent addition for  structure and water retention. But that doesn’t mean every mushroom farm has an easy time finding a second life for its spent substrate, and the quandary of how to make use of the material is growing along with the scale of the specialty mushroom industry. “If you’re gonna do it, awesome, but account for this waste stream you’re producing and how you’re gonna get it off of your property.” That’s the advice Amanda Janney, founder of KM Mushrooms in California, offers new farmers. Janney’s farm is about as modest as they come, operating out of her home in Santa Rosa. As the farm’s output quickly grew, from 20 pounds of mushrooms a week to around 300, the leftover material quickly became a logistical problem to be solved. “In the beginning when we were doing really low volume, it was not much of a consideration; giving bags of spent substrate out via Craigslist and Facebook Marketplace was sufficient,” said Janney. “Then production increased a lot faster than I had planned on, which is a great thing, but a big piece of it became connecting with farmers that were interested in [taking substrate] and getting a workflow to move it off the property quickly.” In 2022, driven in large part by consumer interest in meat alternatives, global revenues for mushrooms were predicted to more than double to over $110 billion by 2030. The nutraceutical market for medicinal mushrooms—such as reishi, lion’s mane, and cordyceps—may follow a similar trajectory, with one forecast suggesting the market could triple to reach $62 billion by 2032. The vast majority—95 percent—of the mushroom production in the U.S. is in Agaricus: the common cremini, button, or portobello (all the same species). Every other variety, be it shiitake or oyster, falls in the specialty mushroom category. In the U.S., Agaricus mushrooms are produced in vast quantities by well-established farms, often generations old and mostly located in Kennett Square, Pennsylvania. Grown in a combination of manure and straw, they produce a distinct kind of spent substrate that is also used as compost, though it is a very different material from specialty mushroom substrate, with fewer applications. To farm button mushrooms cost-effectively is very labor- and space-intensive, and to take up producing them at small scales doesn’t make a lot of economic sense. “It’s a huge opportunity on a spreadsheet, but on the operational side, it’s like, ‘Get this stuff out of here right now.’” By comparison, it is relatively easy to grow enough oyster mushrooms to sell at market for more than $10 per pound, compared to around $5 per pound for button mushrooms. It’s also easy to buy a few ready-to-grow kits for home growers. For these and other reasons, specialty mushrooms are what most small and emerging farms are likely to grow. Sales of specialty mushrooms increased 32 percent between 2021 and 2022 alone, which means an equivalent increase in spent substrate, and more questions about what to do with it. On the extreme end of substrate volume are the emerging mycelium materials companies, like MycoWorks and Ecovative. [Disclosure: The author worked for Ecovative in 2022 and 2023.] Based on oyster mushroom mycelium, Ecovative ships most of its substrate off as compost, and the possible uses it is exploring include selling part of the enormous output of leftover substrate to farms in Pennsylvania for a second act producing mushrooms. There’s a limit to that market, though: “To be frank, you couldn’t possibly eat enough oyster mushrooms in the U.S. to use all the substrate we’re going to make if we meet our goal,” said Ecovative CEO Eben Bayer. “It’s a huge opportunity on a spreadsheet, but on the operational side, it’s like, ‘Get this stuff out of here right now.’” A Community Solution to Substrate Waste Emerges in Texas Rather than relying solely on the market, the question of what to do with substrate is largely being answered by communities local to the specialty mushroom farms. In Austin, for instance, the Central Texas Mycological Society (CTMS) has organized a network of about two dozen locations for free spent substrate pickup. They report that some 9,000 people have signed up since the program started three years ago, with a surge during the pandemic, when interest in homegrown mushrooms took off dramatically. “With spent mushroom substrate, we saw this opportunity to keep people connected,” said Angel Schatz, a lead organizer of the CTMS, whose front yard was the original drop-off point for the program. What people do with the material, though, is their own business. “I know a lot of people are growing the mushrooms, getting a second flush out of the bags, but we don’t want to steal the thunder from the commercial farms in any way, so we start first with teaching people the composting methods.” Photo courtesy of Central Texas Mycological Society Until recently, a significant amount of spent substrate for the CTMS pickup program came from Smallhold, which quickly became a prominent specialty mushroom grower over the last five years, before declaring bankruptcy in early February. With facilities in Los Angeles, Austin, and New York, the company’s objective was to grow specialty mushrooms near major cities. Each of its three large farms generated about 80 to 100 cubic yards of spent substrate per week, and the company employed a team dedicated to finding productive uses for the material. “At the end of the day, this is a valuable material,” said Travis Breihan, who was the company’s impact manager in charge of researching uses for spent substrate. “But it is a new material on the scene, and it’s not like there was an established industry of people second-flushing blocks, or using it as a garden amendment, or even a larger-scale farm amendment. So, I think it’s early in the world of adoption, but all signs are very strong that it’s a great area of focus for the mushroom industry overall.” CTMS isn’t concerned about losing the Smallhold  substrate. “We still work with another farm that produces around 1,900 spent substrate blocks a week, and they will probably grow now because Smallhold won’t be here. Meanwhile, besides giving away blocks, CTMS is working with local farms, food producers, and environmental remediation projects that utilize the material for cleanup of contaminated sites, such as the Circle Acres nature preserve on the edge of Austin. Given the limitations that scale creates for transporting and productively using spent substrate, any future market for the material may indeed be shaped most by smaller operations. Specialty mushrooms lend themselves to this dynamic. They don’t ship well over long distances, and can run on the waste streams—such as sawdust—of nearby industries. It can take many different shapes and, crucially, sizes. As the specialty mushroom industry grows, spent substrate may find a market for secondary mushroom production, or for building and remediating soil and waterways. The potential of the material may best be realized in connecting mushroom production with other food- and soil-based initiatives, and in  supporting more circular, regional economies. “The least we can do is make sure the cycle is complete, and put it back into the soil rather than a dump site,” said Schatz. The post Managing ‘Brown Gold:’ the Challenges—and Opportunities—of Spent Substrate appeared first on Civil Eats.

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