As someone once said, “We laugh that we may not cry”. I certainly got that feeling when watching the documentary Inside Job. I saw it in a reasonably full cinema and in some places people were laughing almost hysterically at the distorted version of reality being presented to them. In other cases they simply gasped at the naked effrontery on display.
Inside Job is an examination of 2008’s Credit Crunch, that led to the largest recession in living memory. While we are now out of the recession, the impact of the subprime crisis is likely to be felt for decades to come in terms of government cuts and job losses. Inside Job looks in forensic detail at why the crash happened and who was to blame. Using a combination of interviews and animation it lays bare the sheer greed at the heart of our financial system as the banking industry and politicians conspired to increase their profits and bonuses at the expense of the public good.
The lie that was sold to the world from the late 1980s to very recently, was that the banks had found a way to increase their profits while decreasing the risk of their investments. The actual truth was that they had managed to increase their profits, but only by taking bigger and bigger risks to the point where a huge systemic crash had to happen sooner or later. Anyone who questioned the wisdom of these actions was either shouted down or shunned for rocking the boat.
For me one of the biggest shocks of the film was the picture it painted of academia. It’s one thing for businessmen and politicians to be corrupt, however all of this was made possible only because so many academic economists supported it through their research and writing. As it turns out now, large numbers of them were in the pay of the banks, despite the significant conflict of interest this created. When questioned about this in the film all of the academics are incredibly evasive about where their funding comes from but deny that it’s an issue.
One of the things that struck me watching the documentary was that no one involved seemed to think they had done anything wrong. Time and time again the same excuses trotted out are; “But everybody was doing it”, “It was the public’s fault for borrowing so much”, “We did our jobs to the best of our ability”. It was only halfway through that I began to realise the horrible truth. These people weren’t just defending their position because they felt they had to, they genuinely didn’t believe that they’d done anything bad. Equally they all sincerely seemed to believe that they deserved the huge paychecks and bonuses that they’d received as payment for their services.
All the way through Inside Job, certain names kept cropping up of the people blamed for the crash. For instance, Head of the Federal Reserve Ben Bernanke, who allowed the markets to be deregulated so they could take bigger risks. The really scary thing though was that Obama reappointed most of them to office when he became President. Therefore the people who helped cause a trillion-dollar financial disaster, that led to millions of job losses worldwide, are now back in government. As the director Charles Ferguson noted during his Oscar acceptance speech for best documentary, no one has yet gone to prison for any of the financial wrongdoing involved in the crash and it looks like no one will now.
One reason why they were able to get away with all this for so long was the incredible complexity of the global financial system. The triumph of Inside Job is that it explains what happened in a way that anyone could follow, and hopefully after its Oscar win more people will see this film. The only downside, if you’re anything like me, is that you’ll be incredibly angry for about a week afterwards
Here is the trailer for Inside Job: