It turns out that SVB’s board of directors was rather thin on investment banking experience and heavy on political connections. (To be fair, there’s also a sound economic incentive to appoint board members with political clout.) One member of the board—Tom King, who joined the board in September 2022—had extensive experience in the industry, but others have relatively little or none.

This is one of the dangers of “wokeism” and social justice theory. These value systems are explicitly hostile to concepts like individual merit. Baked into the ideology is the temptation to hire people based on factors—race, gender, ideology, etc.—other than the value they can bring to an organization; to ignore profit and shareholders, and instead serve greater social causes.

If you doubt this, consider this 2021 interview with SVB board member Elizabeth ‘Busy’ Burr. In the interview, Burr spurns focusing on “numbers.” The words value and shareholder don’t even appear. Her focus is equity, inclusion, and the “tide of racism and white supremacy” in America. Months after the interview, the Carrot CCO joined the SVB board.

[A more experienced board would have foreseen the crisis coming in bonds when the Fed started hiking interest rates, although Credit Suisse missed it. However, they would have had a better chance of seeing the writing on the wall and hedging against it. In the end, it may not even be ‘wokeism’ but crony corporatism and political corruption in the higher levels of the financial industry, fueled in part by bailouts and too-big-to-fail incentives. — Ed]