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by M. Faust
The Fog of Finance: Inside Job
If you’re like me, it doesn’t take much financial talk to put you into a coma. I flunked accounting in college, and have never been able to figure out exactly what it is that the Dow Jones average measures. When the financial system threatened to collapse in September 2008, I believe I was not alone in hearing in the phrase “too big to fail” an unspoken “too complicated to understand.”
Thanks to Charles Ferguson’s new documentary Inside Job, I now have a grasp on the worst financial crisis since the great depression. This is a film I cannot recommend highly enough—ignorance may be bliss, but bliss doesn’t make you a good citizen. And even if you have a solid understanding of the subject, I daresay you will come away with a deeper perspective of it. (If you want to argue with its presentation, I would appreciate hearing what you have to say. I have searched the internet without being able to find any rational counterpoint to Ferguson’s explication.)
One thing I should say right off the bat: Inside Job is not a political screed. Politicians are blamed, but they all take their lumps, Clinton and Obama as well as Reagan and Bush. If you have a tea party friend or relative with whom you’d like to find common ground, this film will certainly do it.
If you saw Ferguson’s previous film, the Oscar-nominated documentary No End in Sight: The American Occupation of Iraq, you know that he has a talent for unwinding tangled skeins and making the murky clear. He came to filmmaking after a career in academia; he has a Ph.D. in political science from MIT and was a Senior Fellow at the Brookings Institution.
The film opens with a very neat microcosm of the coming collapse: the case of Iceland, a model democracy of modest ambition that met its people’s needs. But deregulation of the banks in 2001 led inexorably to a financial bubble that burst in 2008, leaving the country’s economy in ruins.
Using interviews with a wide variety of informed commentators and participants in the world economy, Ferguson lays out the roots of our economic problems with the move for bank deregulation in the 1980s. From there, he traces out how opportunity led to the rise of a criminal strain in American finance. Warning signs pop up—remember the Savings and Loan scandals of the late 1980s? But they are soon laid to rest in the mania to get while the getting is good.
The housing bubble, he makes clear, was not so much the cause of the collapse as it was the final tool of a system that had spun out of control. Experts had been predicting big trouble for years. (My wife, who works in banking, was talking about it in 2006.) But no one listened because there was too much money being piled up.
Aside from explaining the actions and failure of various players and the manipulations invented to turn the American economy into a giant Ponzi scheme, Inside Job is most damning in shedding light on how deep this culture of corruption runs. What does it matter which party is in office when they all listen to the same advisers, the ivy league economists who make far more from financial consulting and lecture fees than they do from their academic work?
Ferguson’s film is, I think, the best documentary of it’s kind since 2003’s The Corporation. It won’t make you happy. It doesn’t offer much hope for improving the system. But it does one absolutely essential thing: it exposes the system for what it is. At least it’s a start.
Watch the trailer for Inside Job
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