When the runaway train that was Wall Street's culture of reckless greed went off the rails and took this nation's – and the world's – economy with it, everybody suffered. Or almost everybody. The heavy hitters responsible for the collapse still got their bonuses so God forbid they shouldn't walk away and take their expertise elsewhere. Financial giants that were too big to fail got bailout money from the federal government, while people who were just the right size to fail saw their savings wiped out and their homes taken away.
How could this happen? Was somebody asleep at the switch? As writer/producer Andrew and writer/director Leslie Cockburn point out at the top of their jeremiad on the causes and victims of the meltdown, there was no one at the switch. In fact, there wasn't even a switch. In 2000, Sen. Phil Gramm (R-TX) slid a provision into the Commodity Futures Modernization Act that effectively shielded Wall Street from federal and state regulation. This is the same guy who in 2008 was forced to step down as co-chair of John McCain's presidential campaign after deriding Americans as "a nation of whiners" and insisting that the economy was fundamentally sound. Gramm of course wasn’t a lone voice in support of a free unregulated market. Among other shills for laissez-faire economics was Alan Greenspan, who belatedly admitted before Congress in the wake of last summer's collapse that he had discovered "a flaw in the model" of his perception of how the market works. Greenspan's ideological model trusted that enlightened self-interest would ensure that the marketplace would regulate itself and police unscrupulous excesses that might otherwise get out of hand and bring the economy to grief.
The Cockburns paint a picture of a financial world devoid of morality and scruples, a culture in which reckless disregard of reason and caution led to a towering house of cards that could only come crashing down. Frank Raiter, a Standard & Poor's analyst who is one of the expert talking heads interviewed in the film, recalls an internal email at his company that read "Let's hope we're all wealthy and retired by the time this house of cards falls." The fever that infected the system as regulations were stripped away brought on a light-headed cockiness; risk was spread out and consequences delayed so the players all felt, like children at a game of musical chairs, that they would be able to find a seat when the music stopped. At Christmas, Raiter says, his colleagues would joke that "we ought to be sending Alan Greenspan a bonus."
Reckless disregard was not the only seed of ruination that plagued the system. There was deliberate deception. BBB-rated sub-prime mortgages were repackaged, and their values were magically inflated. The inmates were rating the asylum. Who designed these shady Rube Goldberg financial instruments? "Idiots," says an expert who is seen only in silhouette to protect his identity.
Pursuit of bottom-line profits led mortgage hawkers to create loan packages so complex even the experts couldn't fully understand them. Minority neighborhoods were targeted for unscrupulous loans. True costs and fees of mortgages, such as escrow payments, were often concealed from the borrower until the closing. A lawyer who is interviewed calls this "the civil rights issue of our time."
The Cockburns personify the cost of these practices by introducing us to three Baltimore African-Americans who have seen their world come apart as a result of the mortgage shell game. We meet a minister who lost the house she grew up in and now lives in a friend's car. We meet a teacher whose dream home has been foreclosed, and a health care worker who faces the same fate. They talk about the shattering impact of coming home to find all your possessions on the sidewalk. Scored to the beat of local hip-hop musicians, their stories are wrenching, but cinematically they drag on beyond the point of maximum impact. There's plenty of red meat in this documentary, but it wants seasoning.
In California, we see signs of the environmental residue of the punctured American dream. A laid-back pool man shows us abandoned swimming pools that now serve as breeding grounds for rodents and West Nile mosquitoes, or as dumps for household items and even cars that the departed owners can no longer afford.
American Casino is a sobering, if sometimes meandering, treatise that lays the responsibility for the financial collapse at the feet of an amoral, unscrupulous profit-driven system. As with other issues of moral and legal culpability that have been topics of the national conversation lately, the brunt of the reckoning will fall not on the people at the top, but on the foot soldiers. And the film warns that without meaningful regulation, even as we find ourselves struggling out of the worst of it and breathing easier about our escape from a full-fledged Great Depression, the rot is in place for another and potentially worse collapse.
Recently President Obama visited Wall Street to tout the signs of upturn in the economy, but he cautioned that "instead of learning the lessons of Lehman and the crisis from which we are still recovering, (some in the financial community) are choosing to ignore them." A few days earlier, the New York Time ran an alarming headline: A Year After a Cataclysm, Little Change on Wall Street. "But the same investors and economists who predicted, and in some cases profited from, the collapse last fall," the story observed, "warn that if the industry’s systemic risks are not addressed, they could cause an even bigger crisis — in years, not decades. Next time, they say, the credit of the United States government may be at risk."
Meanwhile, Wall Street is into the American public for $12 trillion in bailouts. The casino is open for business, and they're playing with house money.
© Text 2009 Jonathan Richards - Filmfreak.be