Jeffrey Lane, Vice Chairman Lehman Brothers from 2003-2007, in Inside Job
Two recent, searing scandals — sexual abuse by Catholic priests and the scheming of Wall Street financiers that triggered the world economic collapse — have some instructive, appalling similarities. Both involved egregious betrayals by people of stature of the trust placed in them by their powerless victims: in one case, the boys and girls scarred by the sins of their fathers; in the other, the middle- and working-class Amiercans who lost their homes, jobs and security. Both ruined thousands of lives. And both sets of atrocities were covered up by the agencies that should have protected the weak. The Church hierarchy stonewalled police investigations and shuttled offending priests to other parishes; Congress and the whole system of financial regulation let the high rollers keep playing, ever more recklessly, until the trillion-dollar tab had to be paid — by the taxpayer.
The only difference in this pair of capital crimes: the pederast priests didn't make money from their malfeasance. The finagling financiers did, in the cumulative billions. After their crimes were exposed, and the U.S. government bailed out their companies, they became even wealthier. If a class designation were to be appended to these brigands, it would be "the filthy rich."
This year's Cannes Film Festival has showcased a handful of movies about the money meltdown, including Oliver Stone's fizzy, sardonic Wall Street: Money Never Sleeps and Jean-Stephane Bron's Cleveland vs. Wall Street, which imagines a lawsuit brought by the city against the banks that foreclosed on so many local home mortgages. Now comes Inside Job, a cogent synopsis of the decisions that led to the Wall Street bubble and collapse, from documentary filmmaker Charles Ferguson, whose Oscar-nominated No End in Sight laid out the Bush Administration's slipshod planning of the Iraq invasion and occupation. In each case, Ferguson has addressed complex issues, involving dozens of key players, and made it all lucid. In Inside Job, narrated by Matt Damon, the filmmaker's tone is calm and professorial; yet you detect his growing anger as he digs beneath the headlines; and the fury is infectious. If you're not enraged by the end of the movie, you weren't paying attention.
The movie opens in Iceland, ends in the Halls of Ivy. Iceland, for years among the sturdiest European economies, in 2005 privatized its three largest banks — which jumped into speculative investments and, as one local economist says tartly, "wrecked the place." By 2008, the Parliament had to take drastic action to avert national bankruptcy. But the masters of the Wall Street universe saw Iceland's crisis as a fluke, not a harbinger, and kept their own party in high gear.
The central part of Inside Job details the history of deregulation, from Reagan to Clinton to George W. Bush, and the rise of financial instruments like derivatives and credit default swaps. Much of this material is familiar, both from news reports and books on the crisis and from earlier docu-blasts, particularly Leslie and Andrew Cockburn's American Casino and Michael Moore's Capitalism: A Love Story. In a way, Ferguson is the un-Moore: he's off-camera, asking questions, not front and center; his tone is serious and precise, not comedic-bombastic. Nor is Ferguson, who earned his Ph.D. in political science from M.I.T., a knee-jerk anticapitalist. In the '90s he and a partner created a software company, Vermeer Technologies, which they sold to Microsoft for $133 million. Unlike Moore, he's more at ease talking to the powerful than to the tearfully dispossessed. Inside Job contains just one brief interview with a woman who lost her home; the other conversations are with the articulate elite of bankers and professors.