Monday, March 14, 2011

Another look at "Inside Job"

This weekend, I got my first look at the newly-released Blu-ray version of this year's Oscar-winning documentary.  Inside Job is a remarkably important movie because it is likely that for many, it will be the dominant (maybe only) explanation of the 2008 global economic meltdown they will see.  So it is important that Charles Ferguson got it right.  And as I have written previously here at real economics, I believe he got it very right indeed.

This does not mean Inside Job is above criticism.  The Blu-ray version exposes some weaknesses that would have probably gone unnoticed by merely seeing this doc in the theater (at least that is true for me).  The biggest shows up in the little 12-minute "The making of Inside Job" mini-movie tucked in the extras folder of the disc.  Watching it I discovered that Ferguson is FAR from being a bomb-thrower.  In fact, his attitude seems that of a rich man (he sold his software company Vermeer for $133 million in 1996) who is sadly disappointed by the ethical failings of some in the financial services business.  (He might have even lost a large chunk of his nest egg and is pissed by the thieves who stole it.)  His film does not examine the systemic failings of the institutions of finance--rather it looks for (and finds) bad guys.

Nowhere is this concentration on the personalities over institutions more apparent than with Ferguson's treatment of the economics profession.  When I first saw Inside Job, this was by far my favorite part of the whole movie.  This time around, I found it sad and irrelevant.  This does not mean I have suddenly forgiven the Predator Class ravings of someone like Harvard's Martin Feldstein, it's just that I don't find it terribly important that he took money (gasp) to write position papers that supported the crooks who crashed the global economy.  Why?

First of all, while the thousands of dollars that these economists picked up for writing papers for the banksters might seem like a lot of money in the academic world, it is just peanuts in the world of global finance.  If these economists were really selling out, they were doing it for very little.

Which leads to the more important problem that Ferguson doesn't even touch--It is HIGHLY unlikely that it would have made a bit of difference how much the academic economists made for writing a paper for the Icelandic Chamber of Commerce, their conclusions would not have changed much, if at all, had they been writing for free.  These academics have managed to convince themselves that economic deregulation was a good idea.  They are true believers.  This is their loving-held worldview.  They have drunk the kool-aid.  This is difficult for Ferguson to accept because it means that the Ph.Ds who run the economics departments of the prestigious universities are not so much corrupt as really, REALLY, goofy.  (I am reminded again of Michael Boskin of Stanford who said as George H. W. Bush's chief economist in response to complaints that we were offshoring critical electronics industries "It doesn't matter if a country makes computer chips or potato chips."  Boskin wasn't being paid or corrupted at that moment to sound like the biggest idiot in the history of economics--he actually thought this was true and will probably defend that crazy sentence to this day.)

Because Ferguson is obviously a bright guy, I am willing to bet that his giving a free pass to academic stupidity is probably more of a class solidarity thing--he has been an academic himself.  And like the truly bright, he seems quite willing to update his information base.  We will see.  Perhaps he has a documentary in the works covering the subject The Dumbing Down of Economics.

And NONE of this criticism detracts from the reality that Inside Job is still one of the great movies.  It is truly remarkable.  And it is a movie one hopes everyone will see.

In the meantime, the unseen hero of Inside Job, Matt Damon, who narrates the film, has already grown past his mindless backing of Goldman Sachs' favorite candidate--Barack Obama.  Someone's evolving!

Is Matt Damon's Narration of a Cannes Doc a Sign that Hollywood is Abandoning Obama?
5/16/10 at 01:45 AM 
Two nights ago Cannes audiences watched Oliver Stone take down the moneymen of America through greed avatar Gordon Gekko with Wall Street: Money Never Sleeps. But yesterday, documentarian Charles Ferguson (No End in Sight) came right out and said what Stone could only fictionalize with the rip-snorting, indignant documentary Inside Job. Though Ferguson's film begins with a scrolling shot of the New York skyline that’s almost identical to one in Stone’s film, Inside Job directly takes on the bankers behind the 2008 financial crisis, attacking early and often. Ferguson gets support from interviews with professional Cassandra Nouriel Roubini, Barney Frank, George Soros, Eliot Spitzer and others. But the most effective presence may be the trusted voice of all-American actor Matt Damon, who narrates the furious takedown of the financial services and the government. It's a fairly bold move by the actor.
This isn’t some maudlin and comical tale, like Michael Moore’s Capitalism: A Love Story; this film is a smart, inciting rant. The documentary argues, as many have, that there is a kind of toxic co-dependence between the financial services industry, Washington, and university economics departments. If Goldman Sachs is a vampire squid, Ferguson is attempting to map out all the major conflicts of interest in the financial world: a kind of Transylvania Sea World.
The aggressive (and, yes, utterly biased) tone of the film makes Damon’s participation all the more notable. As the narrator, Damon explicitly takes President Obama to task for hiring so many of the financial executives who pushed deregulation, and for neglecting to push the feds to pursue any criminal cases against executives on Wall Street. Damon, who campaigned for Obama, has also recently said he’s “disappointed in the health care plan and in the troop buildup in Afghanistan.” This doc may be one more sign that Democratic celebrities are going to push harder against the man they helped elect. more
From No 1 fan to critic-in-chief, Damon takes aim at Obama
The President has rolled over to Wall Street completely, the star tells Tom Teodorczuk
Sunday, 6 March 2011
Few of Barack Obama's celebrity supporters at the 2008 US presidential election were as committed to his cause as the Oscar-winning actor Matt Damon. Rather than merely support Mr Obama in an online video, Damon, one of Hollywood's highest-profile liberal activists, campaigned for the Democratic nominee in Florida. Not content with that, he provided one of the most cutting insults of the campaign when he described the Republican vice-presidential nominee Sarah Palin as "really terrifying... like something out of a bad Disney movie".
Damon, 40, star of the Bourne spy trilogy and two new films, The Adjustment Bureau and True Grit, is scrupulously polite and mild-mannered when we meet in a Manhattan hotel. But laying bare his disenchantment with the Obama administration, he doesn't hide how let down he feels. President Obama's record on the economy particularly rankles. "I think he's rolled over to Wall Street completely. The economy has huge problems. We still have all these banks that are too big to fail. They're bigger and making more money than ever. Unemployment at 10 per cent? It's terrible."
What has proved to be a challenging time in office for President Obama culminated in significant Democratic reversals to the Republicans at last November's mid-term elections. Many of his star backers have either kept quiet about politics or, as in the case of George Clooney, Damon's close friend and co-star in the Ocean's trilogy, remained steadfastly loyal. Not Damon. He is upset that Mr Obama, who promised to "spread the wealth around", has extended the Bush tax cutsand that the inequality gap has widened.
"They had a chance that they don't have any more to stand up for things," he says. "They've probably squandered that at this point. They'll probably just make whatever deals they can to try to get elected again."
Damon appears so disillusioned that, playing devil's advocate, I ask whether he is considering voting Republican. "Good God, no! I just got a 3 per cent tax cut. Do you think I'm going to start a small business with that money? You're out of your mind if you think so. I'm going to put it in the bank. So is every other guy that makes the kind of money I make. I don't think that's what's best for the country. I think a stronger middle class makes for a stronger country." more

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