NYFF ’10: Charles Ferguson Uncovers an Inside Job

In a field that included films from Oliver Stone, Woody Allen, Olivier Assayas, Mike Leigh and others, a documentary filmed on a $2 million budget was heralded as the best film at Cannes in a poll of 19 top film critics conducted by IndieWire. That film is Charles Ferguson’s Inside Job – a sprawling documentary chronicling the causes and impact of the global economic crisis.

Ferguson, a former political scientist and software entrepreneur, is no stranger to exposing corruption. His debut, the 2007 Oscar-nominated documentary No End in Sight, focuses on the two year period following the American invasion of Iraq in March 2003, and the Bush administration’s failings in the initial Iraqi occupation. Time magazine called the film “without question the most important movie you are likely to see this year.”

Three years later, Ferguson has chosen to document the worst economic downturn since the Great Depression. Narrated by Matt Damon, Inside Job provides a comprehensive, easy-to-follow analysis of the events surrounding the global financial crisis of 2008, which came at a cost of over $20 trillion. Meticulously researched and containing loads of interviews with key financial insiders, politicians, journalists, academics, and even a Wall Street psychologist and Wall Street madam, Ferguson’s film vividly captures an out of control industry that’s corrupted everything from politics to academia.

The film is also beautifully shot – no small feat for a film about finance – with IMAX-like helicopter shots that transport you from the luscious hills of Iceland to the picturesque Manhattan skyline. “It might well be the most important film you see this year, and the most important documentary of this young century,” said Salon’s Andrew O’Hehir.

MMM attended a post-screening discussion of Inside Job with filmmaker Charles Ferguson at Lincoln Center’s Walter Reade Theater as part of the 2010 New York Film Festival.

MANHATTAN MOVIE MAGAZINE: One of the things that struck me about the film is what you describe is really a through-line that goes from the 70s/80s to the present and covers both Republicans and Democrats. Considering how polarized our government is, it seems this is one area where there’s a lot of agreement.

CHARLES FERGUSON: Unfortunately, yes. It makes the problem much more disturbing, and much more difficult to deal with. The fact that the problem is completely bi-partisan also makes it more difficult for the American people to understand what to do.

MMM: What happened to the whistleblowers? How do people look at them now?

FERGUSON: There was a guy who’s actually in the film, Dr. Rajan, who’s now at the University of Chicago. At the 2005 Federal Reserve Conference, there was a fete for Alan Greenspan, and he gave a paper that said, “You guys are heading for the biggest crash that there ever was,” and he laid out how, why, and when it would happen. People like Larry Summers stood up and called him names, and he was almost booed off the platform. Even now, I don’t think he gets a lot of credit for it.

MMM: Clearly, when you’re interviewing all these people, word must have gotten around that there was this guy Charles Ferguson who made a well-regarded film about Iraq and is asking a lot of questions. Was there some technique you used to nail down these interviews?

FERGUSON: I was terrified that that would in fact be a problem, and in some cases, it was. Some of the people who declined to be interviewed knew what I was doing and clearly didn’t like it. In the case of Glenn Hubbard and Frederic Mishkin, we interviewed them three days apart – Hubbard first. I crossed my fingers for 72 hours that they weren’t going to talk during that period. One thing – this is funny and it’s also not funny – that helped me in this regard, in the case of Hubbard and a number of others, they were so embarrassed, ashamed, and fearful at the end of their interviews, that the last thing they wanted to do was tell anybody what had occurred.

MMM: With the downfall of Lehman, why didn’t you look at the antagonistic relationship between Henry Paulson and Dick Fuld? Many people point to that as the reason why the government didn’t decide to save Lehman Brohters.

FERGUSON: The question of why Lehman was forced into bankruptcy is one of those questions like why the Bush administration started the Iraq War. There are 20 different possible explanations; each of them probably has some degree of truth. I would love to be Henry Paulson’s psychiatrist. Unfortunately, I am not. Let me give you the list. One is that Richard Fuld has apparently antagonized just about everybody on the entire planet just with his personality – arrogant, abrasive, etc. Second, most of the other Wall Street firms, the top management of Lehman Brothers was primarily – with just one exception, a cousin of President Bush – composed of Democrats who were substantial contributors to the Democratic Party. Third, Paulson really did care about the moral hazard argument and wanted to make an example of this company. Fourth, he didn’t have the faintest idea of how much damage Lehman’s bankruptcy would actually cause. Fifth is that Lehman had been emerging in the previous decade as an increased competitor to Goldman Sachs. Finally, there’s also the possibility that there was an ego issue; that there was no easy way for Paulson to back down, personally, when the British said that they wouldn’t [bail out Lehman] unless there was a federal guarantee. So, that’s the list. Choose what you like.

MMM: Were there things in the film that you wish you put in but weren’t able to?

FERGUSON: There are many things I would have liked to put in the film. I would’ve liked to put more in the film about the specific cases where congressional action was the result of lobbying or influence of the financial services industry. There just wasn’t time.

MMM: Did you ever think of including the Tea Party movement – who want to deregulate the economy – and Stephen Shwarzman, who has become the bête noire figure of Wall Street?

FERGUSON: Again, there are many people who weren’t in the film for time or priority reasons, basically. Scharzman would be one. Pete Peterson, the founder of Blackstone, would be another. Jimmy Cayne, the chairman of Bear Stearns, would certainly be another. We actually had him in an earlier cut for kind of black humor purposes. How many people know this? When Bear Stearns was going down the drain, Jimmy Cayne was too busy to pay attention to his company because he was playing bridge at a bridge tournament in Chicago with two Italian professional bridge players who he pays half a million dollars a year to play bridge with him. There are many stories about Jimmy Cayne – marijuana, which he consumed in quite large quantities even though he was a conservative Republican, etc. We just couldn’t include it and I do have regrets about that. With regard to the Tea Party, one reason we couldn’t include it was time since we had to finish the film at a certain point. And the other was it’s not clear to me how important that phenomenon is. It could turn out to be important and lasting in American politics, it could turn out not to be. I would say I’m agnostic about that question.

MMM: How did Matt Damon get involved?

FERGUSON: Two ways: we asked him, and he said yes. He was the only person we asked. We thought he would be better than any person we could imagine. So, why did we like him? He’s somebody whose voice and character is very well known, is known to have political concerns in an intelligent way. And why did he say yes? It turned out he made a thriller set in Iraq called “Green Zone,” and while he was preparing for the film he saw my documentary about the occupation of Iraq, and apparently liked it. He turned out to be absolutely great – not just for the narration, but he had clearly read the transcript of the entire film quite carefully, and he had very intelligent suggestions about the precise places where we ourselves regarded as problematic. We had this very clunky, convoluted ending, and the ending we have now in the film owes quite a lot to his suggestions and our discussions with him about what to do. And, needless to say, given that the total budget of this film was $2 million, he worked for substantially less than his normal rate. [Laughs]

MMM: Do you think this is essentially a film about addiction – to money, power, sex – and the refusal of recovery?

FERGUSON: That’s actually a very interesting question, and a very perceptive one. The material in the film about that is there for two reasons: I do think there’s something to what you just suggested, and the other is that that environment led these guys to be remarkably disconnected from the things that would discipline you or me if we tried to behave in a similarly egregious fashion. They had so much money and insulated themselves in this bubble. I personally find it strange that somebody who already has $400 million would be willing to risk this in order to get more.

MMM: In terms of looking forward, do you see for consumers, the appointment of Elizabeth Waren [the new head of the Consumer Financial Protection Bureau], as another case like Brooksley Born [who attempted to regulate derivatives and was stopped], and do you see Larry Summers going back to Harvard [as a professor] where we’re instilling the same type of education that’s going back up the chain?

FERGUSON: Elizabeth Warren’s appointment is probably not going to do much good. Her appointment is temporary. She has a dual appointment in reporting to President Obama and the treasury secretary [Timothy Geithner], whom she is not friends. It’s pretty clear, given the overall pattern we see in the administration, we’re not going to expect much or get much from this agency in this administration. With regard to Summers going back to Harvard, yes it is quite ironic that he’s going to do as much damage there as he did in the previous administration.

MMM: One thing I like very much is how you bring in international perspectives, the IMF, the interviews with Singapore, China. I’m wondering how your idea of bringing that aspect in, and were there more international agencies?

FERGUSON: There were many more, and that’s one of the regrets I have about length limitations on the film. There were a large amount of extremely interesting people, several of whom are about to be indicted. The former prime minister of Iceland, who I was told last night, is soon going to be arrested and tried. He was trained as an economist in the United States. [Laughs] We interviewed him, and one thing I very much regret is that I asked him if there ever been a time in economic history when an entire nation’s banking system in a five year period has borrowed 10 times its GOP. And the pained laughter of his response was just priceless. But somehow it didn’t make the cut.

MMM: One of the things that’s startling about this film and “No End in Sight” is these very public problems that are presented that have never been shown in such a way before. I wonder if you could talk about the media, which is absent from both movies, and their complicity in both Iraq and this story. Do you think they were lied to, or their interests are complicit with their subjects, and how do you see non-fiction filmmaking as a remedy for that complicity?

FERGUSON: It’s a complicated situation. On the one hand, it is certainly the case that the business and financial media did not do as good of a job as they could have done, and the nature of these problems has not been explained as widely as discussed, not as deeply investigated while they were building. It is not the case that you couldn’t read about this anywhere. There have been, actually, quite a number of good articles and books about different aspects of this subject. But, it is unquestionably true that the majority of the specialized press, the relevant specialized press—and this was also true of Iraq with our foreign policy military press—did not go as deep, did not push as far as they should have. Part of the problem I believe is the nature of access journalism, as significant measures come to be, what makes you good as a journalist is that you get an exclusive interview with this powerful guy, he gives you some fact, and you publish it tomorrow morning since you’ve got the scoop. It’s hard to practice that on a long-term basis if you are tough and critical. And perhaps because of the financial pressures on the media, or other reasons, investigative journalism is not in bountiful supply in the traditional media. And I hope and believe that the web and documentary film are taking up some of that slack.

MMM: As Elizabeth Warren certainly has Obama’s ear, are you doing anything specific to get her to see the film and make her comment in any way? And is Frederic Mishkin really back teaching at Columbia?

FERGUSON: Yes, Mr. Mishkin is certainly at the Columbia Business School, and this might stun you, but if you were to see the full interview that we did, he would look much worse. [Laughs] Actually what happened was that we had an earlier cut, and a couple people, including Michael Barker of Sony, came back and said you can’t do this, because people are going to have sympathy for him because you have destroyed him so completely. You’ve got to ease up. So we actually did. I won’t go into details. Mr. Mishkin does not come off well in the film. He and everyone else in the film have been invited to see it. He declined to come but sent a public relations executive to come report back. In regard to Elizabeth Warren, I’m sorry this might pain a number of you, and it’s somewhat politically incorrect, but Elizabeth Warren is not the solution to all of our problems. I admire her; I admire her work, but the only way she’s been able to get to where she is, is by being extremely careful not to criticize the Obama administration outside of the extremely specific issue that she is now, kind of sort of half in charge of dealing with. I spoke with her privately at great lengths, and she declined to be interviewed on camera for exactly this reason.

MMM: Were you pressured in any way to not put any of these interviews in, or was there anyone trying to influence the film?

FERGUSON: The simple answer is no—no one tried to pressure us. Several people tried to retract the permission for their interviews but we already had their signed released forms and that was that. In regard to pressure, I have to say something about the Sony guys—Michael Barker and Tom Bernard. They have been, and excuse me I’m going to be a bit vulgar to make my point, they’ve been totally fucking amazing. I was really scared when I started making this film I would get calls like this guy is my neighbor, this guy is a major shareholder, etc. Never once. Never once. And they are now supporting this film extremely strongly. I have my quibbles with the movie distribution business but they have been incredible.

MMM: When did the five-act structure of the film come to you? You obviously had a very high ratio of stuff you shot to what you actually used.

FERGUSON: I would say it’s about half and half. By the time we started editing, I had done an enormous amount of research and I knew what was in the interviews because I had conducted them. At the same time, there was an extraordinary amount of material. We filmed about 70 or 75 interviews, and most were about an hour and a half long, and some were even two or three hours long. In addition, we had an incredible mass of documentation of every kind—books, articles, lawsuits, government documents, and academic articles—huge quantity of stuff. So the editors were critical. The two editors, Chad Beck and Adam Bolt, are much more than what you think of normal editors. The structure of the film really emerged. I had about half when we started editing, and the rest emerged while working with them. And they worked really hard. The last four months, they were working 6 days a week, typically ‘til 1 or 2 in the morning. And I was typically in there with them for about 6-8 hours a day.

MMM: Where do you see the economy in five years, and do you think there will ever be any convictions?

FERGUSON: I think we have a rough five years ahead of us, and possibly a rough generation. The American economy and American society are troubled, and there’s all of this, which is a big thing, and then there are all of the other important things that aren’t being attended to because the people responsible just don’t care about attending to them. The high school graduation rate in South Korea is 96% and in the US its 78%, that’s a problem. With regarding convictions, I think there will only be convictions if the American people get angry enough.

INSIDE JOB is now playing in select theaters nationwide.