Inside Job, Charles Ferguson’s follow-up to his Iraq War gut-twister No End in Sight, is a documentary that inspires less shock and awe than sickening ire. The movie, which had its first local showing last week at the New York Film Festival, opens with the cautionary tale of little Iceland, an idyllic nation so stable that, as put by one local, it enjoyed “almost ‘end-of-history’ status.” But the beat goes on: Evil entered the garden with the deregulation, privatization, and multinational exploitation of the nation’s local banks. Sound familiar?
Ferguson is a less rabble-rousing filmmaker than Michael Moore, but 20 minutes into his lucid yet stupefying account of the 2008 global economic meltdown—around the time a stroll down memory lane recounts Ronald Reagan’s role in facilitating the Savings and Loan debacle of the mid ’80s—my vision was clouded by the steam wafting from my ears. Next up, the quotidian Clinton-era crimes of corporate money-laundering, book-cooking, and pol-bribing. This may have been business as usual, but the 1999 repeal of the 1933 Glass-Steagall Act re-stoked the coals of my indignation as savings banks were set free to merge with investment houses, and the wholesale merchandising of speculative derivatives opened the way for the full-scale casino-ization of the American economy.
Inside Job makes a familiar tale cogent. Bankers pumped up the housing market by offering subprime mortgages like free tastes of heroin, then bundling these dubious loans as investments to create an international Ponzi scheme—the debt sold to eager and/or naïve customers while they themselves were insured against loss with credit default swaps. Encouraging even more gambling, the federal SEC lifted leverage restrictions on the banks so that they could play with ever-more borrowed money; rating agencies colluded in the frenzy by certifying dubious investment bonds and thus creating the conditions for a massive sell-off. You may remember that the party ended with a bang two years ago last month, when the reality police appeared at the frat-house door. Venerable investment houses collapsed, intolerable pressure fell on the fissuring pillar that was insurance giant AIG, the temple tottered, and the capitalist system went into cardiac arrest.
Were individuals to blame or was it simply the unfettered system being itself? (As Marx wrote of credit, debt furtively crept in as “the humble assistant of accumulation” to become “a new and terrible weapon” in the redistribution of wealth.) Midway through Inside Job, Ferguson begins a search for accountability, polite but firm as he mixes it up, off-screen but on-mic, with unrepentant Big Board hustlers, confounded government regulators, and obfuscating academic pundits. Small solace to watch the rogues squirm: No one, Ferguson points out, has yet been prosecuted for fraud. Indeed, resuscitated at the public trough, the surviving banks are even more powerful. Their lobbyists clog the Capitol, and campaign contributions are bigger than ever.
The bingo hall may have closed, but the fix is in. Although Inside Job attempts to exit on a positive note, the movie is most despairingly proof of the existence of a permanent government. Bill Clinton’s slack-jawed grin as he poses beside thuggish Larry Summers is nearly as appalling as George W. Bush’s thin-lipped smirk in introducing delusional Hank Paulson. (The closest thing to a political hero is Eliot Spitzer, mirror image of a self-entitled Wall Street master of the universe.) Although Inside Job is rife with bullshit artists, the most contemptible are the tenured Ivy League professors such as Columbia’s Glenn Hubbard and Frederic Mishkin or Harvard’s John Campbell, who, eager for crumbs at the table, are little more than paid flacks for the corporate buccaneers.
There’s not much sense that the system can be voted out—not least because Barack Obama, shown campaigning on the crisis and elected in part to change the game, recruited his economic advisers from those who enabled the disaster. Despite the populist tendency to blame the gummint (although, curiously, not its lax regulation), the upcoming election is less likely to throw the rascals out than, abetted by the same band of billionaires, elect a new passel in.