"Inside Job," A Movie Everyone Should See

Inside Job is a documentary written and directed by Charles Ferguson, narrated by Matt Damon and starring Ronald Reagan, Alan Greenspan, Bill Clinton, Henry Paulson, Robert Rubin, and many others whose obsession with deregulation and whose regulatory failures led to the banking crisis and worldwide recession that began in 2008 with the bankruptcy of Lehman and AIG and the collapse of GM and Chrysler.

The movie dissects the origin and development of the mortgage bubble, it's meltdown and the resulting world recession which resulted in 30 million people losing their jobs. Like Michael Moore's documentaries, Inside Job is composed of ambush interviews, news clips and comments by most of the key players who declined to be interviewed and by critics of banking practices and regulatory failures, beginning with the Reagan administration and continuing until the world wide economic crash which began at the end of the Bush administration in 2008.

The documentary takes viewers step by step through the developments, beginning with deregulation debacle in the savings and loan industry under Reagan and continuing through subsequent administrations including, importantly, the repeal under Bill Clinton of the Glass-Steagall Act which had required the separation of banking and riskier securities trading activities since 1933. The elements leading to the housing bubble and the financial meltdown were deregulation of the banking industry, securitization of the mortgage industry through the creation of mortgage derivatives, excessive bank leverage creating excessive risk and failure of the bond rating houses to accurately assess the risk brought about by securitization of subprime mortgages.

The movie is similar to several of Michael Moore's movies such as "Wall Street, A Love Affair." Inside Job's lack of Moore's humor is more than made up by the detail and clarity which it provides about the dogmatic faith in unregulated markets, abuses, growth and influence of Wall Street banking behemoths and how they have captured government economic and regulatory policy, including the recent weak regulatory bills signed by Barack Obama.

However, one of the most compelling and damning portions of the documentary is its expose of how the financial industry pays economists at top universities and graduate business schools to write articles expressing their viewpoints without disclosing the payments they get for the "research" and serving as directors of the companies. Larry Summers, former Clinton Treasury Secretary, Harvard President and chief Obama economic adviser has made millions consulting for hedge funds. The Dean of the Columbia Business School, former Bush chief economist, R. Glenn Hubbard, and Reagan economist Martin Feldstein came across as arrogant and defensive when pressed by the interviewer about their ties to Wall Street and their role in the rush to de-regulation and tax cuts for the richest Americans. John Campbell, chairman of Harvard's economics department and Glen Hubbard were reduced by the interviewer's questions "to stammering obfuscation," to borrow a phrase from A.O. Scott's N.Y. Times review of the documentary.

The most discouraging conclusion of the documentary is it's demonstration of how seamlessly the the baton was passed from the Wall Street insiders and fanatical Friedmanite free market economists to Treasury Secretaries and de-regulators in the Reagan, Bush, Clinton and Bush administrations. And many of the same true believer captives of Wall Street were appointed by President Obama, belying and undermining his eloquent vows to reform the financial industry.

To borrow another phrase from A.O. Scott's review , the movie is "about a crime without punishment" and with millions of victims.