by Robert Gore
If two-thirds of a group of conspirators avoid prosecution, trial, and imprisonment, but the other third does not, has justice been served? That’s a question raised by the movie The Big Short’s treatment of the 2007-2009 financial crisis. The movie is a dramatization of Michael Lewis’s non-fiction book,The Big Short: Inside the Doomsday Machine.
This is not a review of The Big Short, which was entertaining and amusing, with clever writing and strong performances by Christian Bale, Ryan Gosling, and Steve Carell. The movie did not, however, feature a viable explanation of the causes of the financial crisis. Yes, bankers offered mortgages to people who could not afford them, bundled them into junky mortgage-backed securities and more complicated debt instruments, and with the help of asleep-at-the-switch ratings agencies, regulators, and government-blessed mortgage finance agencies, sold them to speculators and investors whose due diligence extended no further than the triple-A rating.
So The Big Short justifiably prosecutes and would like to put in jail the bankers and ratings agencies, but aside from light slaps on the wrists (a heavily leveraged, pole-dancing real estate speculator and a regulator-regulated revolving door vignette), the two other major conspirators—feckless, often dishonest mortgagees and the government—get off scot-free. However, even if the movie had figuratively hauled them off to the hoosegow, it missed entirely the real cause of the financial crisis: financial and political gravity. Gravity doesn’t make for very good cinema, but it’s an appropriate subject for an SLL piece. (SLL doesn’t have a $100 million production and advertising budget to cover, will never be in contention for an Academy Award, and only needs to appeal to an audience that’s maybe one-day’s tally of Big Short viewers at a typical Megaplex.)
