What would be the best metaphor for the U.S. financial system before the 2008 economic crash? A bubble? A ticking time bomb? A house of cards built on quicksand next to a row of dominoes in a strong wind? Charles Ferguson's impassioned, detail-oriented documentary Inside Job explicitly uses the first two images, and leaves something like the latter in the viewers' heads as the film parcels out blame for the economic mismanagement that precipitated the Great Recession.
Former Internet entrepreneur Ferguson previously applied his policy-wonk perspective to the calamitous groupthink that lead to the Iraq War in No End in Sight. Given Inside Job's even more complex and arcane subject matter, Ferguson jazzes up the narrative with lavish helicopter shots of Wall Street, snappy sound bites during the opening credits, pop songs like Peter Gabriel's "Big Time" and simple, accessible graphics. The density of information doesn't obscure Inside Job's righteous anger.
After a wry prologue in Iceland, where banking deregulation leads to a financial crisis like America's writ small, Inside Job traces America's recent economic highs and lows such as the 1980s Savings and Loan crisis. The first sections "How We Got Here" and "The Bubble" explore, in a wonderful phrase, "the threat of financial innovation" and how financial instruments like derivatives, sub-prime mortgages and credit default swaps set up Wall Street for a fall. Inside Job does the best job I've seen to date at explaining the Byzantine instability of the system.
Ferguson's thesis holds that the investment bankers and captains of financial industry knew they were running reckless, unsustainable games, and that institutions responsible for oversight either looked the other way or couldn't see what was in front of their faces. Inside Job paints a portrait of a corporate culture so pointlessly competitive and intoxicated by greed, it never occurs to anyone to question their actions. Ferguson remains an off-camera voice that can scarcely believe some of his subjects' evasive non-answers. Expert witnesses include economist Nouriel "Doctor Doom" Roubini and feisty consumer advocate Robert Gnaizda of the Greenlining Institute.
Wall Street madam Kristin Davis, who's physical appearance is both hypersexualized and uncomfortably artificial, attests to the institutional popularity of cocaine and prostitutes among high-flying traders. Former New York governor Eliot Spitzer makes compelling arguments that criminal activities are so pervasive that an aggressive prosecutor could flip low-level employees to go after the bosses, but no law enforcement organization seems to have the stomach to pursue such cases. (Spitzer also deadpans that he's not the person to speak to against sexual transgressions, acknowledging the prostitution scandal that cost him the governorship.)
Most of this will be loosely familiar to anyone following the major financial news — and after the largest single Dow Jones point drop in history and two years of nearly 10 percent unemployment, who doesn't? Ferguson covers fresh ground in his fourth section, "Accountability," where he claims the financial system "has corrupted the study of economics itself." Here, Inside Job focuses on Ivy League academics who deny they have conflicts of interest, despite their sweetheart deals with the big banks and other organizations. Former Federal Reserve governor Frederic Mishkin stammers like Woody Allen when Ferguson questions him about his report on Iceland's financial sector, for which the country's chamber of commerce paid $124,000. And whaddya know, it was highly favorable, despite the country's impending crash.
The most openly nasty and defensive figure turns out to be Columbia Business School dean Glenn Hubbard, a champion of the 2003 Bush tax cuts. Hubbard bristles at the questions about professional ethics until he snaps, "This is not a deposition! ... You have three minutes. Take your best shot." Which, of course, makes him seem far guiltier of something than if he'd simply kept to "no comment."
These scenes feel reminiscent of the time Jon Stewart grilled TV stock-picker Jim Cramer on "The Daily Show." Partly, they present attempts to hold people accountable who should've known better, or did know better and kept silent. But the confrontations also feel like Stewart and Ferguson are venting their frustrations with individuals who only had indirect responsibility for the crash, while key decision-makers Henry Paulson, a former Treasury Secretary and Goldman Sachs head, remain out of reach.
Matt Damon narrates Inside Job, prompting some political pundits to wonder if Hollywood has abandoned President Barack Obama. But the U.S. financial disaster leaves plenty of indignation to go around. Inside Job articulately argues, to take an overused metaphor from the midterm elections, that the Bush administration drove the U.S. economic car into the ditch. However, Bill Clinton's deregulatory policies gassed up the car, and now Obama seeks driving advice from the same so-called experts who caused the accident in the first place.