Inside Job: A Review

This year's Oscar for Best Documentary went to Inside Job. Since I read (although didn't quite finish) Sorkin's Too Big to Fail, which is about the financial collapse, I thought I would like the movie even more. I didn't.

The movie tells a one-sided story about the financial collapse, blaming it all on Wall Street. Since Paul Krugman has actually blamed a global savings glut for the bubble and the recession, I have to accept that the documentary is not telling the full truth.

But I do believe that the financial industry along with moderate and conservative politicians and many economists, bear significant blame for the size of the recession and the need for a bailout. So I am only slightly offended that the movie beat up on those parties that called for deregulation.

What really bothered me about the movie though was that the interviewer was not very good at asking good tough questions. His questions were too broad and vague and he often allowed people to simply disagree without any explanation. He probably thinks this made the respondents just look stupid when you compare their answers to the evidence. But I think it doesn't give the interviewees a fair shake and at the same time it missed an opportunity to really get the interviewees.

For example, when talking about executive compensation, he asks if it is excessive. The industry lobbyist was able to simply say, "no". Instead he should have asked whether the compensation rewarded bad behavior by rewarding short term profit without punishing long term risk and loss.

Similarly, he asked about conflicts of interest among economists. The economists would just say no and were never pushed. Instead of asking whether it impacted objectivity when an economist was writing about complex derivatives but also being paid by companies that made a lot of money on derivatives, the interviewer just asked where the economist got his compensation from.

The whole movie had the feel of wanting to beat up on the guilty parties instead of having a real dialogue with them. It seemed to actually try to avoid conversation and using tricks to tell the viewer to hate the person on screen. In fact, most people it wanted to portray negatively refused to appear on screen, which seemed to work fine for those making the movie since they made it seem like those how refused were trying to hide something. But it would have made a better movie had they been able to convince those people that they would have had a real conversation.

As for how it won an Oscar, I wonder if Hollywood was overjoyed to see a movie that made other really rich people look like monsters and made the Hollywood-types - also very rich - feel superior. Just a hunch.

The one thing I hadn't known or thought about before seeing the movie was the issue of conflicts of interest among economists. I think it is a serious issue, but it is one that permeates so many other industries that need to be regulated (conflicts in the pharmaceutical industry has been getting attention lately, but we know that revolving door issues affect many government programs' effectiveness). An across the board - for all industries - conflicts of interest policy is much needed.