Hollywood

Inside Job Documentary Passes

November 01, 2010

Multiple Pages
Inside Job Documentary Passes

Typical documentaries, such as Waiting for “Superman” and Freakonomics, are made by people who know more about lenses and lighting than about their subjects. In contrast, Inside Job, a competent condemnation of Wall Street’s role in the recent economic unpleasantness, is the work of Charles Ferguson, a smart, rich generalist who didn’t get into the movie business until he was 50.

After obtaining a Ph.D. in political science from MIT, Ferguson cashed in on the dot-com bubble. In 1996, he sold FrontPage, a mediocre web-development program (which I, unfortunately, used for years) to Microsoft for $133 million. Not surprisingly, Inside Job contrasts Wall Street’s ethical cesspool with Silicon Valley’s supposedly shining moral high ground. (No mention is made of the options-backdating chicanery tainting Steve Jobs and other tech titans.)

Ferguson is angry that the Obama Administration hasn’t arrested any investment bankers. He helpfully outlines a hardball strategy for potential prosecutors: Round up Manhattan call girls and persuade them to roll over on their trader johns for putting hookers and blow on company expense accounts as tax-deductible “research.” Then terrify the traders into snitching on the Big Boys.

Instead, Obama has appointed numerous banksters to high office.

Inside Job is longer on well-informed indignation, talking heads, and bar charts than on directorial dazzle. Ferguson’s chief cinematic flourish is the cheap but effective trick of helicopter shots showing giant banks’ skyscrapers backed by ominous, irritating electronic music. I was soon convinced that the architecture’s malignity was a mere excrescence of the evil within…until Ferguson lingered on a malevolently looming Empire State Building. “Wait a minute!” I finally realized. “I like the look of the Empire State Building! And its tenants aren’t vampire squid colossi, they’re down-on-their-luck small-timers. Hey, my emotions are being manipulated!”

“Ferguson complains about government’s failure to regulate lenders but never mentions that the blowout happened precisely where politicians demanded more lending.”

Still, Ferguson understands the financial details enough to make a coherent story (superior to Oliver Stone’s recent Wall Street sequel) about how money, power, and ideology corrupted so many.

Inside Job’s most original segment details the cozy conflicts of interests through which numerous economists, including superstars Larry Summers, Martin Feldstein, R. Glenn Hubbard, and Laura Tyson, got rich off financial-industry directorships and consulting fees, all while pretending to provide students and citizens with disinterested economic insight (which coincidentally rationalized Wall Street’s wants).

Or at least Ferguson tells half of a coherent story. Inside Job is excellent at explaining why bogus assets—in general—would appeal to Wall Street. IMF economist Raghuram G. Rajan points out that paying annual bonuses calculated on short-term profits encouraged bankers to take on long-term risks that the public might wind up bailing out.

But why, out of countless financial instruments, did mortgages in the “Sand States” of California, Arizona, Nevada, and Florida—with minorities defaulting disproportionately—happen to be what blew up the world?

This insidious question wouldn’t even occur to an average documentarian such as Davis Guggenheim of the inane Waiting for “Superman.” Ferguson, however, knows more than he lets on in Inside Job. He leaves out the other half of Rajan’s even-handed blame-laying: The government undermined credit standards to boost home ownership among minorities and the poor. Ferguson complains about government’s failure to regulate lenders but never mentions that the blowout happened precisely where politicians demanded more lending.

Tellingly, Ferguson even includes a clip dated “Oct. 15, 2002” from George W. Bush’s catastrophic speech denouncing down payments and adequate documentation as mortgage requirements, a historic turning point otherwise shoved down the Memory Hole by ashamed Republicans and guilty Democrats. Of course, Inside Job doesn’t mention the politically correct occasion of Bush’s irresponsible oration: his White House Conference on Increasing Minority Homeownership.

In such a moral morass, whom can Ferguson trust to recount history? Comically, the director trots out as his reliable witnesses Congressman Barney Frank (!) and Robert Gnaizda of the Greenlining Institute. Like ACORN and hundreds of other “community redevelopment” shakedown artists, Greenlining demanded more mortgages for minorities to fight racist redlining.

Gnaizda, a green-eyed white man, has done very well for himself in the Diversity Industry. As a 2005 Los Angeles Times exposé implied, Greenlining is something of a Capitalist Front, suavely offering civil-rights certification to dubious lenders. Say you’re CEO of an aggressive mortgage firm and an anarchic ACORN whines to the feds that you racially discriminate. Well, Greenlining’s professionals can furnish you regulatory cover. Promise to lend more to “underserved” minorities, and they’ll issue a press release announcing you’re moral. Greenlining’s funders thus turned out to include subprime boiler-room operators such as the notorious Ameriquest.

In short, the rich (“Heads we win; tails we’re too big to fail”) needed the poor (“Heads we win; tails we’ve got little to lose”) to swindle the middle class.

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