"Nothing will fundamentally change" — including big bank bailouts

Episode 116 Sneak Peek

It’s deja vu all over again: the American government is bailing out banks. “What,” asks a recent piece by Bloomberg’s Michael Tobin and Hannah Miller, “was Silicon Valley Bank to the world of startups and venture capital? Practically everything.” Everything indeed: it has been “the single most critical financial institution for the nascent tech scene” since its incipience forty years ago, and until just this week it was the sixteenth-largest American bank by assets. SVB, a titan of the tech sector, thrived alongside venture capital, as past KK&F guest Branko Marcetic writes for Jacobin — but fears of inflation giving way to higher interest rates and a lower volume of available venture capital, among other things, spelled trouble.

Now, though it’s a word Biden won’t use, a bailout is what we’d call the measures our government is taking to shore up SVP’s spectacular fallout. (The head of the Troubled Asset Relief Program, or the 2008 bank bailout, is calling it a bailout, by the way.) Goodbye to taxpayer dollars (and lots of them) that might have gone to establishing universal healthcare, funding public education, building any of the social welfare programs we so often hear there’s not enough money for. To understand why this is such a damning moment for the Biden admin, how it exists on a continuum with the financial crash of 2008, and how the Left can respond, we’re inviting reporter Matthew Zeitlin on the show. Paying subscribers can tune in Friday to watch our convo — and as always it will be available to everyone Saturday through Spotify, Pandora, Apple Podcasts, and more.