America Continued from page 15 By law, auditors must state whether


they have any doubt about a company’s ability to survive over the next year. In both cases, KPMG expressed no doubts. Within two weeks, both banks failed. If auditors are unable to detect fraud or risk, what are they paid for? Twenty months ago, when SVB


acquired Boston Private Bank and Trust, the Fed Board unanimously authorized this acquisition, stating that SVB would not “pose significant risk to the financial system in the event of financial distress”—exactly the opposite of the Fed’s March 13 statement to jus- tify its intervention to save the bank’s depositors. We also know that on March 7, three


days before SVB failed, Fed chairman Jay Powell stated in his Senate hear- ings that “American banks are strongly capitalized.” After the bank failures, the Fed


promised to conduct an internal review. Internal reviews, however, are tooth- less. They are bound to absolve the very parties who commission them. After the Challenger explosion in


1986, the investigation of the disaster was not left to NASA but to a presiden- tial commission led by William P. Rog- ers, a former U.S. attorney general. The Rogers Commission was a top-


notch group that counted among its members Richard Feynman (Nobel Prize in physics), Neil Armstrong (the first man to walk on the moon), and two Air Force generals. Precisely because it was indepen-


dent and authoritative, the commission was able to identify the root cause of the Challenger disaster (including NASA’s responsibilities) and propose some rem- edies to avoid similar disasters in the future. Of course, the 2023 banking crisis


differs from the Challenger tragedy, which killed seven people. Neverthe- less, there are many similarities. After succeeding in taking a man


to the moon and bringing him back to earth safely, NASA was the pride of the nation, the pinnacle of American tech- nology and organizational capability. The Challenger explosion undermined that confidence. Only a presidential investigation


From ‘Woke’ to Broke Silicon Valley Bank gave $70 million to “social justice” causes as it was going bust.


BY MARISA HERMAN AND DAVID A. PATTEN B


efore it was shuttered by federal regulators after a


bank run, Silicon Valley Bank donated more than $70 million to various “social justice” initiatives that sought to advance the Black Lives Matter agenda. The Claremont Institute’s


Center for the American Way of Life created a database tracking corporate contributions and pledges from 2020 to the present that goes to the Black Lives Matter movement or a related cause that advances BLM’s agenda. Of the more than $83 billion allocated by corporations to the


16 NEWSMAX | MAY 2023


Black Lives Matter movement and afiliated causes, the database found that Silicon Valley Bank made $70.6 million in donations to groups pushing initiatives including race-based, discriminatory hiring programs; race-based sub-prime lending; partisan voter initiatives; and diversity, equity, and inclusion efforts, commonly abbreviated as DEI. According to the report’s


“facts” page, SVB spent $2.8 million on “gender parity innovation” and “diverse emerging talent.” In 2021, the bank doubled


could expose how NASA, sitting on its laurels, had become complacent and inefficient. The same can be said for the Federal


Reserve. Handling the 2008 crisis might not have been like taking a man to the moon, but it was probably more impor- tant for human welfare. In a world where most institutions


are plagued by partisan divisions, the Fed appeared until recently as the only bipartisan institution run by highly skilled technocrats who could do no wrong. No longer. In the last two years, the


Fed has failed twice. It has failed to see inflation coming, and it has failed to see the banking crisis coming. The only way to recover this trust


is through a transparent, independent, and authoritative commission whose findings are believable. President Biden should appoint such a commission without delay.


Luigi Zingales is contributing editor of City Journal and author of A Capitalism for the People: Recapturing the Lost Genius of American Prosperity.


down on its commitment to environmental, social, and governance standards – a strategy often abbreviated as ESG – in a filing to the World Economic Forum. “We aim to enable


relevant comparisons of our ESG performance with peer companies,” read its index to the global financial institution. While the bank made several


alarming decisions – such as having an unusually high level of uninsured deposits and investing heavily in long-term government bonds and mortgage-backed securities that plummeted in value as interest rates rose – conservatives say the bank’s focus on “woke” causes helped lead to its demise. It reportedly went eight


months last year without a chief risk-management oficer.


According to Claremont


Institute, SVB also made Environmental, Social and Governance-related “investments” in activist groups, including Color of Change, the NAACP, the National Urban League, and the American Civil Liberties Union.


Among the other indications


SVB “went woke before it went broke”:


A Morgan Stanley index


gave SVB an A rating for ESG. The Daily Mail reports SVB


pledged to invest $5 billion in environmental sustainability initiatives by 2027. Its European ofices held a


Pride celebration that spanned an entire month. SVG claimed to be striving


to create “a more just, equitable, and sustainable world” in its 2022 ESG Report.


RARRARORRO/SHUTTERSTOCK


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