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Taxpayers Bailing Out Venture Capitalists After Silicon Valley Bank Collapse

© AP Photo / Jeff ChiuA food delivery worker enters Silicon Valley Bank in Santa Clara, Calif., Friday, March 10, 2023.
A food delivery worker enters Silicon Valley Bank in Santa Clara, Calif., Friday, March 10, 2023.  - Sputnik International, 1920, 15.03.2023
US President Joe Biden has improbably promised that the government bailout of Silicon Valley Bank will not cost the taxpayer a cent — and that its shareholders will not get their money back. But technologist Chris Garaffa, a co-host of the Covert Action Bulletin podcast, is skeptical.
Ordinary Americans are paying to bail out reckless investors who gambled their money away on "risky" technology start-ups.
Chris Garaffa told Sputnik that venture capitalists were lobbying hard for the US government's emergency takeover of California's Silicon Valley Bank (SVB), which went insolvent last week after a sudden run by its crisis hit tech-sector depositors.
That wave of major withdrawals exposed a black hole in its asset portfolio of government bonds, which had been undermined by the Federal Reserve's decision to hike interest rates in the face of rampant inflation — ultimately caused by President Joe Biden's sanctions on Russia.
"We have bailed out a number of venture capitalists and investors who provide actually no real benefit to Silicon Valley, to the world, except the fact that they have money and they choose to give it to what turned out to be some pretty risky investments," Garaffa said.
"That's how we should be looking at this," he added. "The class divide between those of us who just provided the money to save those who invest, who put their investments in SVB, and the people who actually put the investments in SVB."
FILE — In this July 26, 2021, file photo, Gov. Gavin Newsom appears at a news conference in Oakland, Calif. Supporters of the effort to recall Newsom are asking a court to prohibit him from calling the effort sRepublican recall in the state's official voter guide. The lawsuit was filed by July 30, 2021, by Orrin Heatlie, the Republican activist who launched the recall effort. - Sputnik International, 1920, 14.03.2023
Three Wineries Belonging to California's Newsom Were Reportedly Among Silicon Valley Bank Clients
The commentator said the likes of German tech magnate Peter Thiel, Sam Altman — founder of 'startup accelerator' Y Combinator — and IT sector investor Jason Calacanis had been "spent all weekend basically on Twitter, on podcasts and blogs" arguing that the US treasury should bail out the failed bank for the sake of "you know, job creation and stuff like that."
Those "super wealthy angel investors and venture capitalists" are "some of the same people who are saying... we can't or shouldn't be spending money to solve the... homeless crisis in California" or that student debt is "a problem of the individual," he said.
"But when it comes to their investments, in fact, then we should all take responsibility for their so-called bad choices," Garaffa pointed out. "I say they should all just learn how to code and get a job."
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