13 Mar 2011

'the next line of coke, the next seven minutes, no longer serves anyone but the super rich'

I finally went to see this last monday, I have been busy with Green Party meeting, visit to squatted Gadaffi house and much else besides but finally have a moment for a short review.

I saw it at a very strange cinema that smelt of moth balls in Notting Hill. If you can, go and see it and pay cash or buy the DVD, I believe in free but this needs supporting.

Political documentaries are not really my thing, I find them often a bit dull and didactic and full of stuff I already know. 'Inside Job' was an exception.

It looks and sounds very good as you can see from the splendid trailer above, it is highly entertaining.

It explains the quite complex economics very clearly indeed. Its not a Michael Moore polemic, while I like some of his stuff, it can verge on the stunty and the silly.

The origins of the US financial crisis are presented with clarity. Over decades regulations were relaxed as city firms and big banks gained more and more control over the Republicans and Democrats.

Highly speculative financial instruments introduced risk into the system especially for small investors, auditors, accountants and economists turned a blind eye because they were being paid huge amounts of money.

The financial sector was based on huge salaries, often $bns and a culture of drug taking and prostitution.

The real story is the failed economics, though. These people could all be nuns but if you design a system to fail, chaos will result, irrespective of the personal ethics of those operating the machine.

The most entertaining and worrying aspect was the corruption of the economics profession, which surprised me, I thought people believed in market based economics rather than being bought.

The interview with Frederick Mishkin was damning, some wiki details here

Mishkin has been a consultant to the World Bank, the Inter-American Development Bank, and the International Monetary Fund, as well as to numerous central banks throughout the world. He was also a member of the International Advisory Board to the Financial Supervisory Service of South Korea and an adviser to the Institute for Monetary and Economic Research at the Bank of Korea.[2]
In 2006, Mishkin co-authored a report called "Financial Stability in Iceland".[3] The report maintained that Iceland's economic fundamentals were strong. The report was commissioned by the Icelandic Chamber of Commerce in response to critical coverage of the Icelandic economy and certain Icelandic companies in the international business media.[2] Mishkin was paid $124,000 to co-author the report.[4]
Iceland subsequently experienced a spectacular collapse within a year of Mishkin's report. According to the documentary "Inside Job," on Mishkin's CV the title of the report was changed to "Financial Instability in Iceland."

The film could have embedded its analysis in a wider account of the instabilities of our current economic system but you can't do everything in two hours, so this is a minor criticism.

Elinor Ostrom, the first women to win the Nobel Prize for economics, argues that in economics we should make decisions with the next seven generations in mind. Her insight is essential if we are to have sustainable prosperity. The think of the next $bn, the next line of coke, the next seven minutes, no longer serves anyone but the super rich.

Ironically the bankers, city boys and free market economists seem to have an ever stronger grip of the global economy, especially here in the UK, they don't want you to see this film. Give them the two finger salute by watching Inside Job and spreading the word.

Superb film!


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