Monday, 19 December 2011

Inside Job, outside job

There's a neat moment in the film Inside Job where, confronted about his interchangeable roles as select assistant to the US government and multiple consultancies to elite financial institutions, Glenn Hubbard, Chief Economic Adviser and Bush Administration Dean of Columbia Business School, turns irritable and angry, giving his interviewer sharp notice that the exchange is about to be terminated.

It's a seminal scene in Charles Ferguson's highly-revealing film, showing just how grandiose and reactive such people can be when their coveted world is challenged.

As part of his 'academic' services, Hubbard had co-authored a paper with Goldman Sachs' chief economic adviser, praising credit derivatives and other volatile instruments that led to the banking meltdown of 2008 - being handsomely rewarded for his efforts.

Another Harvard neoliberal guru, economics professor Martin Feldstein - adviser to Ronald Reagan and key architect of US financial deregulation - simply blanks the questions of financial impropriety with sly smiles and dismissals. 

Yet another, Chairman of Harvard Economics Department, John Campbell, looks similarly sheepish, calling all such evident conflicts of interest "basically irrelevant."

How awkward and irascible even the most confident 'intellects' can seem when their claims to 'academic integrity' have been rumbled. 

As Peter Bradshaw notes in his review of the film:
"Perhaps the most sensational aspect of this film is Ferguson's contention that the crash corrupted the discipline of economics itself. Distinguished economists from America's Ivy League universities were drafted in by banks to compose reports sycophantically supporting reckless deregulation. They were massively paid for these consultancies. The banks bought the prestige of the academics, and their universities' prestige, too. Ferguson speaks to many of these economists, who clearly thought they were going to be interviewed as wry, dispassionate observers. It is really something to see the expression of shock, outrage and fear on their faces as they realise they're in the dock."

However, contrary to Bradshaw, there's nothing actually "sensational" at all about the discipline's 'compromises' - how very Guardian to think so. The truth is that America's academic system, alongside its political system, was already long-corrupted - as one of the film's contributor's puts it - by America's "Wall Street government".

Still, how telling of market life that so many well-educated professors have discarded academia for trading floor consultancies, with mathematician 'wizards' creating mind-boggling instruments even they don't understand. As the resultant collapses show, speculation in these Frankenstein products isn't genius science or 'wealth-creating' enterprise, it's parasitical selfishness, creating nothing for society at large.  

It's a study in itself to observe these groomed figures squirm in discomfort as Ferguson lists, in meticulous detail, their revolving-door positions as key political advisers and directorships in profit-obsessed banks.

As his penetrating movie suggests, the capacity of elites to swindle and lie is as vast and excessive as the astronomical figures involved. In the immediate aftermath, the US Treasury approved more than $700 billion in lifelines, most of it now spirited away by the same crooks.

Despite the collapse of giants like Lehman Brothers, the exposure of serial malpractice within iconic banks like Goldman Sachs and the complicity of super-trusted rating agents such as Moody's, guilty directors have all exited with vast payoffs, bonuses and other untaxed remunerations, while those evicted from their sub-prime homes are cast aside to live on the street.

The scale of America's banking heist, the corporate villainy and the ensuing protection of those responsible is simply staggering. And so is the consistency of the financial cabal's defence against any regulatory adjustments. As the film notes, Wall Street is more consolidated and, through intensified lobbying, politically stronger than ever.         

Inside Job is not, however, without its more analytical flaws, among them the honorary assessments of 'philanthropist financier' George Soros as an advocate for 'fair reform' of a promiscuous system he himself has played a considerable part in creating.

More centrally, it has nothing at all to say about the corporate-run media which plays such a crucial role in legitimising the overall system of profit and greed. Where's the critique of the business press in all of this discussion, in particular the liberal business media? It's a vital omission.

The Wall Street Journal and its stable-mates may revel in exposing this or that instance of financial corruption. But is this not part of the bigger deceitful prop of a 'decent-but-flawed' system?

The elite financial towers don't stand apart from the rest of the corporate jungle, of which the corporate media is a central structure. 

Whether ultra-conservative or reformist liberal, daily appraisal, dissection and approval of the business world keeps the 'integrity' of the business culture intact. Alas, perhaps betraying his own liberal constraints, Ferguson offers no investigation of this key ideological cover or the propaganda role of the financial commentariat.       

Thankfully, the film spares us any romantic narrative on Obama the 'saviour president'. As we see, all the same guilty people have been retained as advisers, the promised prosecutions never happened, the gigantic sums Obama oversaw in his part of the bailout will never be returned.

All of which has been a great new learning curve for the American and wider global public. The belated mass disillusion over Mr Hopey Changey has generated a more acute understanding that all the political class are in the expansive pocket of big business.   

The ensuing Occupy Wall Street movement has also drawn-in new inside reformist elements such as the Alternative Banking Group, comprising many already working in high finance.   

Yet, as Occupy Wall Street, like Occupy LSX, seek to engage 'repentant' bankers, such notions of reform carries with it the risk of believing that the system is fundamentally sound, merely in need of adjustment and better regulation.

The 'far-reaching reforms' of the UK banking sector, just announced, is evidence of the elite's latest attempt to protect and maintain; another damage limitation exercise to sweeten the toxic austerity pill.

Again, our corporate-liberal media indulge this charade with dutiful gravitas, the cited objections to Vickers confined to possible 'adverse impacts' on small business and token concerns from the public. Nowhere is there the merest mention of capitalism in crisis or the case for radical alternatives.

The stark, bottom-dollar truth is that the entire structure is beyond redemption. Wall Street and its satellite bastions don't need reforming. They need dismantling.  And, while films like Inside Job partly educate us on the deep, challenging nature of the problem, that task will only progress, however slowly, as part of an outside job of mass, non-incorporated resistance.


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