Costco Connection - March 2011

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OB INSIDE JOB INSID
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n A filmmaker’s exploration of the financial industry’s meltdown A f
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H By Steve Fisher OW DID IT HAPPEN—the financial col- lapse that began in 2008 and cost millions of people their savings, their jobs and their homes? That is the question Charles Ferguson set out to answer in his award-winning doc- umentary, Inside Job. Through interviews with scores of indi- viduals—bankers, government regulators, international financiers, economists and more—Ferguson follows the trail of financial industry deregulation and the lack of government oversight that set the stage for the collapse. While much of the back story to the financial meltdown has already been exposed, what Inside Job illustrates is that the players involved in creating the crisis are still very much in charge on Wall Street and in Washington, D.C.

In addition, the film shows how economists at the leading universities are financially rewarded for lending credence to the policies they espouse. Ferguson compares their roles to that of a medical researcher who writes an article recommending a drug while taking money from that drug company. The head of the Harvard Economics Department seems stumped as to whether the examples are related or if ethical standards should be applied to university economists.

Ferguson, who produced, wrote and
directed Inside Job, holds a Ph.D. in political
science from the Massachusetts Institute of
Technology and claims no political agenda.
“The film is factually correct,” he maintains.
“I view myself as a documentary filmmaker,
and an investigative journalist and a policy
analyst.”
Recently, The Connection discussed
Ferguson’s film with him by phone.

The Costco Connection: How much of the story did you know going in?

Charles Ferguson: I knew some of the people who were involved in analyzing this and warning about it in advance. Then I did six months of research before we started filming. But even so, there were still things that came out in the interviews that were a surprise.

CC: Did you find it was worse than you thought it was?

CF: Unfortunately, I did. When I started making the film, if someone had told me we’d find out that … all of the investment banks

“ The film is factually correct. I view myself
as a documentary
filmmaker, and an
investigative journalist
and a policy analyst.”

Producer-writer-director Charles Ferguson

had been secretly creating securities that they hoped would fail and then profiting by betting against them, I wouldn’t have believed it. I would have said, “That doesn’t happen in the United States. We don’t do that.” The other thing I learned that was also very disturbing was how unprepared and disorganized and thoughtless the government’s response was to the crisis.

CC: What was the level of criminal involvement?

CF: We don’t really know, because unfortunately there has not been adequate investigation of that question. When I say we don’t know, I mean we out here in the public don’t know. People in the Justice Department might, people in the FBI might, people in the banks probably do.

CC: Why do you think there were no prosecutions?

CF: I think initially, in the early Obama
administration, for the first six months of
2009, there was to some extent a fear for the
stability of the system. I think that part of it is
unquestionably the people running the gov-
ernment were heavily involved in this. Not
necessarily directly criminally liable them-
selves, but they had spent the previous
decade saying that everything these guys
were doing was fine and the regulation was
fine, and it certainly wouldn’t look good for
their reputations and their public personas if
it turned out that everything and everybody
they had been working with and supporting
was now going to jail. And then there’s very
simply the political power of this industry.
Bankers don’t go to jail anymore.

CC: What do you want the viewer to take from this film?

CF: I certainly hope that people seeing the film will come away with the sense that there was something very wrong done here and that it hasn’t been fixed and that our current government is not going to fix it unless we make them. It’s going to take a very grassroots effort and come from the bottom up.

Ferguson has set up a way for people to be part of that effort by going to Facebook.com and searching “Inside Job.” A teacher’s guide to the film is available online at www.sony classics.com/insidejob/. C