The Browser - Going Infinite

A weekly letter from the founding editor of The Browser. Correspondence and criticism gratefully received and always read: robert@thebrowser.com

This week: Michael Lewis and Sam Bankman-Fried; books that I am reading

MY THANKS to correspondents who have written to me about philosophy of mind. I hope to return to this subject next week and to look at some of Karl Friston's ideas.

But this week let me do you a small service by pointing out that Going Infinite, Michael Lewis's account of the rise and fall of Sam Bankman-Fried, is an extraordinarily good book. I read it at a sitting, I enjoyed every page, and I came away with a much-improved understanding of Effective Altruism, of cryptocurrencies, and of the strange atmospherics which overtook the world's financial markets in the Covid years of 2020-2022.

"No surprise there", you might respond. For does not Michael Lewis always write good books, much as Ferrari always makes fast cars and Taylor Swift always sells out concert tours?" I surely agree — which is why I was surprised and dismayed to see Going Infinite reviewed in tones ranging from the damning to the merely patronising:

"Going Infinite is the story of how Lewis, the best long-form journalistic writer of the past 20 years, fell for his protagonist and may have maimed his long-justified reputation in the process" — The Times

"Michael Lewis had incredible access to Sam Bankman-Fried but got played by his own protagonist" — Fortune

"Reading Going Infinite, Michael Lewis’s strange new book about the disgraced crypto entrepreneur Sam Bankman-Fried, you soon get the sense that Lewis felt unusually flummoxed by his material" — New York Times

"What you won’t learn from Michael Lewis’ book on FTX could fill another book" — Los Angeles Times

"[A] dissonant hagiography of the world’s most boring second-tier villain" — Slate

Going Infinite may one day be regarded as either the pinnacle or the nadir of Lewis's career. The trial will make him look like a fool or it will make him look like a genius. — New Yorker

I believe Going Infinite deserves more and better consideration.

Going Infinite is well worth reading for its account of Effective Altruism alone. I knew something of the Effective Altruism movement and of its philosophy; I knew that Bankman-Friedman was one of EA's earliest adherents and one of its main financial supporters; but I had not previously appreciated quite how EA operated, nor quite how large a part it played in Bankman-Fried's life. I have more sympathy now for those who call EA a cult rather than a movement.

Bankman-Fried was a junior at MIT when he was recruited into EA by William MacAskill, one of the movement's founders:

Completely out of the blue, a twenty-five-year-old lecturer in philosophy at Oxford University reached out and asked to meet with him. Sam never learned how the guy had found him — probably from the writing Sam had been doing on various utilitarian message boards. MacAskill belonged to a small group inside Oxford that had embraced ideas hatched long ago by an Australian philosopher named Peter Singer. He wanted Sam to join him for coffee, then attend a talk he was about to give down the road at Harvard.

The argument that MacAskill made in his Harvard talk was that if people like Sam wanted to "do good" in the world, they should do it systematically. They should organise their own lives in such a way as to save the maximum possible number of other people's lives.  

They could start, said MacAskill, by making an appropriate choice of career. Four options recommended themselves. An Effective Altruist might become a doctor or an aid worker, saving lives directly. They might become a scientist, making life-saving discoveries. They might become a politician or an educator, changing the rules and attitudes of society. Or they might pursue a job on Wall Street, maximising the earnings with which they could support the altruistic work of others.

Given the choice, said MacAskill, it was probably best to become a banker. Anybody who went into medicine, or science, or teaching, was likely to do good in any case. But that was not the case with bankers. If you turned down a job in banking, the job would be taken by somebody else who was very probably not an altruist, and the gains to altruism would be lost. Thus anyone with the ability to go to Wall Street and make vast sums of money had something like a moral obligation to do so.

One obvious omission from this calculus was the possibility that a banker might do more harm in their professional life than they did good in their private life; but MacAskill was untroubled. "Many lucrative careers are really pretty innocuous", he said.

The other big thing which happened to Sam Bankman-Fried in his junior year at MIT was that Jane Street Capital gave him an internship which led to a job. He thrived there. Nothing in life had ever really interested him except games and puzzles, and Jane Street treated the financial markets as a massive multiplayer game with real money.

Jane Street interns and traders were encouraged to make small bets with one another throughout the day as form of adversarial learning. One of the first lessons you learned at Jane Street was to wonder why a bet was being offered to you: What did the other person know that you did not?  

Lewis's chapter on Jane Street is one of the best things I have read about the workings of a financial institution, a worthy successor to Lewis's classic account of his own time at Salomon Brothers in Liar's Poker. Here is a taster:

The older traders, anyone over the age of thirty, were built differently than the younger ones. They were bigger and taller. They’d come of age at a time when trading was still done human-to-human, either on trading floors or in trading pits. In a crowd their bodies needed to be seen and their voices needed to be heard ... The younger traders were less socially adept than the older traders, because they could afford to be. Now that trading was done machine-to-machine, it mattered less how well traders negotiated with other people. What mattered was their ability to help the machine replace humans in financial markets—either directly, by writing code, or indirectly, by giving instructions that might be codified. To their minds it was silly not to just let the computer do all the mental math.

When Bankman-Fried left Jane Street in 2017 to try his luck in the Bitcoin boom, he was fully formed. Jane Street supplied his business model, which began as arbitrage. Effective Altruism supplied his rationale, his investors, and his first employees.  

I could happily summarise the rest of Lewis's book, but that would sit awkwardly with my claim that the book should be read in its entirety. Let me halt the recap here and get back to my contention that the book was unfairly reviewed.

The big problem for reviewers, I think, was that what Michael Lewis found in Sam Bankman-Fried was an idiot-savant rather than a crook. In Lewis's view Sam was naive, delusory, reckless, callous, self-pitying, and contemptuous of almost everything except game theory. His approach to the law, and to most other things, was a mixture of ignorance and indifference. But he did not act with mens rea, criminal intent. He was not, as it were, evil. And (although I do not think Lewis makes this particular point), in most jurisdictions an action done without criminal intent is not a crime.

When you read Lewis's book, therefore, what you get is hard to square with what you get on the front page of the New York Times. The day on which Going Infinite arrived in the shops was also the day on which Sam Bankman-Fried arrived in a U.S. Federal Courthouse charged with masterminding one of the largest frauds in American history. If convicted he faced up to 85 years in prison. (The consensus on the Metaculus prediction market is that he will be convicted and sentenced to 16 years.)

If I am right in arguing that Lewis has written not only a wonderfully readable book, but has also provided a considered, coherent and entirely believable account of Bankman-Fried's rise and fall which does not insist on Bankman-Fried's criminality; and that Lewis did so in full knowledge of what had happened and what is alleged to have happened at FTX; then I probably need to account for the critical consensus elsewhere that Lewis was "taken in" by Bankman-Fried, or, alternatively, that Lewis was so far into his book when FTX collapsed that he could not bear to tear it all up and start again.

My explanations are (i) it is hard not to assume that somebody is a crook when their business is cryptocurrency and they appear on the front page of the newspapers surrounded by US Marshals; and (ii) envy. Most of Lewis's 21 books have been best-sellers, all have been widely admired, and some have been turned into blockbuster films. When an opportunity presents itself to claim the high moral ground and to castigate Lewis for having fallen short of his own standards, one can hardly expect a reviewer not to seize that opportunity and run with it.  

I think it likely that Going Infinite will be my favourite non-fiction book of the year, in a strong year for non-fiction. As for fiction, I had been starting to think of this year as a slow one, but it turns out that publishers were just holding off their best stuff until autumn. I am now juggling half-a-dozen books that are dazzling in their different ways, and I have not even started on The Fraud.

The Glutton, by A.K. Blakemore, is being compared to Hilary Mantel's Wolf Hall, and rightly so in terms of sheer accomplishment. But in style and substance I would compare it rather with Daniel Kehlmann's Tyll. Both books combine folklore with magical realism to spellbinding effect.

The Maniac, by Daniel Labatut, is not quite as good as When We Cease to Understand the World, but that still leaves plenty of room for it to be very good indeed, and better than any other book I have read about John von Neumann, fiction or non-fiction. As to whether The Maniac itself should be classed as fiction or non-fiction, who knows? Were it not prose I would call it poetry.

The Prophet, by Helen Macdonald and Sin Blaché, is every bit as "fabulous" as Neil Gaiman declares it to be in his blurb. And yes, this is the same Helen Macdonald who wrote H Is For Hawk, and whose office address is the University of Cambridge Department of the History and Philosophy of Science. The Prophet tells of a clandestine mentalist summoned to investigate the sudden appearance of an American diner in an English field; some history, some philosophy, and some science.

Rental Person Who Does Nothing, by Shoji Morimoto, is probably the least possible novel you can get for your money. Not "least" in quantity, for it is a respectable 160 print pages; and not "least" in quality, quite the opposite; but least in affect, if that is the right word. The narrator rents himself out to people who just want to have somebody around for a while. Not for any salacious purpose, nor for any practical purpose. No bodyguard-duty, no lawn-mowing, no expert advice — preferably no stated purpose at all. The fact that a living can be made in this way is as baffling to the narrator as it might be to you or me, and the result is strangely delightful.

And that is the end of this letter. There are some more words below, but they are like one of those scenes that can pop up after the credits when you think the film is over and you are already leaving the cinema. I am guessing that you think I overdid it with my praise of Michael Lewis, so I am going to postscribe here some lines that I highlighted when reading the book because they gave me so much pleasure:

Sam was trying to persuade forty or so employees to move nine thousand miles to an island without a school to which they’d be willing to send their kids. He was deciding whether to simply pay off the $9 billion Bahamas national debt himself, so the country could fix their roads and build schools and so on. He’d recently met with the new prime minister to discuss this idea.

Sam treated everything on his schedule as optional. The schedule was less a plan than a theory. When people asked Sam for his time, they assumed they’d posed a yes or no question, and the noises Sam made always sounded more like “yes” than like “no.” They didn’t know that inside Sam’s mind was a dial, with zero on one end and one hundred on the other. All he had done, when he said yes, was to assign some non-zero probability to the proposed use of his time. The dial would swing wildly as he calculated and recalculated the expected value of each commitment, right up until the moment he honored it or didn’t.

One interpretation of Sam’s childhood is that he was simply waiting for it to end. That’s how he thought about it, more or less: that he was holding his breath until other people grew up so he could talk to them.

Every time he flipped through books or articles on management or leadership, he had roughly the same reaction he’d had to English class. One expert said X, the other said the opposite of X. “It was all bullshit,” he said.

He told his fellow managers that in his estimation there was an 80 percent chance that the money would eventually turn up. Thus they should count themselves as still having 80 percent of it.

“I’m a utilitarian,” he wrote. “Fault is just a construct of human society. It serves different purposes for different people. I guess maybe the most important definition — to me, at least — is how did everyone’s actions reflect on the probability distribution of their future behavior?”

He hired Ryan without being totally sure what Ryan would do. “The job description was sort of make it all better”, said Ryan.

Right from the start, FTX should have hung a sign on the door that said No Experience Necessary. “It’s a moderately bad sign if you are having someone do the same thing they’ve done before,” Sam said. “It’s adverse selection of a weird sort. Because: why are they coming to you?”

A guy from Blackstone called Sam to say that he thought a valuation of $20 billion was too high. Blackstone would invest at a valuation of $15 billion. Sam said: "If you think it is too high, I’ll let you short a billion of our stock at a valuation of twenty billion". “The guy said: "We don’t short stock". Sam said: "If you worked at Jane Street you’d be fired the first week".

A lot of effective altruists chose not to have kids. After all, in the time it took to raise a child to become an effective altruist, you could persuade some unknowably large number of people who were not your children to become effective altruists.

And that really is the end. Thank you for humouring me. If you enjoyed those highlights from Going Infinite, you can find highlights from my other reading at The Reader. — Robert

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