Send It Back, Ben!

Will Semafor really keep Samuel Bankman-Fried's scammy money?

One of the early investors in Semafor, the ambitious new media venture launched by two unrelated Smiths, Justin and Ben, was Sam Bankman-Fried, the now largely disgraced crypto tycoon. Just six months ago, SBF invested in Semafor’s initial $24.6 million Series A funding round — one of only five principal funders, apparently. After SBF’s fall, Semafor’s spokesperson issued a statement:

“We closed our seed round in May and received all investments in full in USD. While we are monitoring the evolving situation closely, we don't anticipate an impact on our financial outlook or our business …”

That's nice, but actually I wasn’t worried that Semafor wouldn’t be able to hold on to its Bankman bucks. The question is more:

Will Semafor give the money back?

Legally, the issue may be murky--could the many creditors of a bankrupt FTX try to claw back SBF’s investment? I have no idea. But morally, it seems almost open and shut.  Maybe Bankman-Fried wasn’t a felon: The jury is still out —or, more accurately, has yet to be empaneled. But the stench of sleaze and scamming is unmistakable and familiar. SBF's empire seems to have opportunistically incorporated bits of Elizabeth Holmes (selling people on a crypto  "box" that may or may not have been empty), Lehman Brothers (massive overvaluation of assets), Tyco (SBF helped himself to a loan of a billion dollars); John Corzine (using client deposits to cover for investment losses) — with a little bit of Bernie Madoff (Ponzi) thrown in. People were ripped off and are in the process of losing their savings, including many people in West Africa, a target of SBF’s marketing. Semafor has an African bureau. Maybe it can interview them while it keeps their fellow victims’ money.

Would the Smiths be willing to found their grand new enterprise -- catering to an “elite global audience",” promising to end “polarization, distrust of journalists” -- on mob money? No. On Madoff money? I doubt it. Semafor's origin story is filled with mentions of Davos - where Justin Smith first pitched Ben the idea -- as well as the aspirationally highbrow Atlantic, with its “elite group of intellectual bloggers” (Smith’s description). Does fleecing crypto fools fit with this image? If only to be able to hold their heads up, they should send the money back. Given their salience, it would probably generate enough good press to attract an equivalent amount in new funding. Give to earn!

P.S: I’d add a line about how this would ensure Semafor a bright future, except I'm not sure Semafor has a bright future. The market for international news geared to a business elite is not exactly unserved (Financial Times, Bloomberg). Semafor’s founders seem to be assuming a decline in social media, and its attendant polarization, that may not materialize. They're launching into a potential global recession. And Justin Smith has shown an alarming tendency to build snobby products designed to not only please elites but exclude the peons. If the Aspen Institute didn't exist he'd invent it, and sell ads. I can’t say I’m rooting for them to succeed (and not just because Ben Smith once wrote a strange hit piece on me).

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Who Cheats First? Many Republican analysts have concluded they got clobbered in the midterms because they didn't have the Democrats’ national mail-in ballot operation--in part because Trump disparages mail-in balloting as a playground for fraud.  These Republican analysts are correct, I assume. If "harvesting" mail in ballots is allowed, for example, the party can hardly afford to unilaterally disarm.

But that doesn't mean vote-by-mail isn't a playground for fraud!  With mail-ins, you don't know how the ballot was filled out (was there pressure, subtle or unsubtle — there’s certainly no guarantee of secrecy). You don’t know who actually filled it out, or if both sides were given equal opportunity to vote. You don't know if the opposing party’s ballots were accidentally dropped in the river.

If you think this is fanciful paranoia, you ‘ve never met the people who work at the ground level in day-to-day campaigns. They are often idealistic — they work long hours for little pay. They are also often slightly insane — maniacs consumed with a desire to win. They’re unlikely to respect commonly accepted ‘guardrails,’ or the law, for that matter. I’ve seen this with my own eyes — e.g. when low level activists in a campaign I was involved with openly talked about “going to the phone books” to collect signatures on a ballot petition (as they had previously done, successfully). The people running the campaign almost certainly never knew about this.

We’re told mail-in voting has worked for years in Oregon and Colorado. But now that both parties are playing the game in every state in the union, it's only a matter of time before we have a large, democracy-damaging scandal that will make us regret this arms race ever started. Maybe it will now be a Republican scandal, which doesn't make it any better.

That’s a prediction. If I’m wrong you can personally harvest my ballot.

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Pass the Schlag: When Elon Musk first talked about taking over Twitter, I had a common, Appollonian view of how it would operate: It would be a national public square, governed by formal First Amendment rules the same way an actual public square (run by the government) would operate. Everyone would say their piece. Nobody would be penalized, outside of the accepted categories (e.g. libel).

After three weeks of Musk, it looks like that will not be what Twitter is. I've already seen enough people penalized (even if lightly, or humorously) by Musk, to the point where — I have to admit — I censor my own tweets for fear of offending him. Chilling effect! (He’s only one guy but he seems to notice even the little sparrow.)

There's a better analogy, maybe, than “public square”: Twitter is a 1910 Viennese coffee house. A really big Viennese coffee house, with a cranky proprietor. All species of views are present and accounted for. There's Freud over in one corner, Jung in another, some communists over near the door. Every now and then Kafka stops by. Many of these people hate each other -- a few activists are always trying to get the TERFs kicked out -- but in the end they all must coexist and sometimes they talk to each other. Still, they're all a bit careful not to piss off the proprietor, who occasionally walks up to a table, points to someone and says "You! Out!" And that person has to leave. Yet this happens so infrequently it doesn't really dampen the hubbub of argument.

It's not the ideal. But it's freer than before, freer than anywhere else. It's a lot of fun. And it's the best we're going to get. Very glad it happened.