Economic Crash Through the Works Term Paper
- Length: 8 pages
- Sources: 3
- Subject: Economics
- Type: Term Paper
- Paper: #61217064
Excerpt from Term Paper :
Sorkin's book does a good job of giving the details on what happened among Lehman Brothers, Barclays, JP Morgan, Goldman Sachs, the Fed, and Big Gov following the collapse. Essentially, everyone had egg on his face -- but some of the bigger powers had the muscle to save face -- and sink competitors at the same time: which is exactly what Goldman Sachs did to Lehman. Goldman had been placing its cronies in the White House for years -- and it would now go through the White House to see who got bailed out and who did not. AIG got one -- because it owed a large chunk to Goldman (who had figured out the game ahead of time and started betting against itself by buying insurance through AIG). Sorkin's work is a work full of the kind of details that other writer's like Taibbi and Lewis do not take the time to give their readers. Taibbi is more about taking the knife to the jugular. Lewis finds that human element -- that human interest story, such as belongs to Vinny and Eisman. Wessel tries to find it in Bernanke, Geithner, and Paulson -- but there is not much to find there. Their humanitarian efforts were akin to helping everyone sort out his chips at the end of the game in the most orderly fashion. That was all.
Nonetheless, Wessel attempts to put these men in heroic roles in the same way Arthur Miller tries to make a salesman a dramatic hero -- it does not work. What really happened is clear enough, as even Wessel cannot hide: the poker game ended, the crestfallen sat with hanging heads, the ones who still had cigars left lit up; the mood was quiet and deferential -- everyone had to show his cards. Wall Street, the Fed, and the White House all made grim faces at one another, made speeches to the public, and if they were on the winning side, lined their pockets with gold. If you were Lehman, you just went home empty-handed: "On Sunday, September 14, after it became clear that Lehman would not be salvaged, the other big Wall Street firms were told to open their books to one another at the New York Fed" (Wessel 188) (a laughable idea -- Vinny had spent six months trying to understand those same books: the fact was that no one could understand them -- they had been cooked six different ways from Sunday).
However, such actions are typically performed to show the public with what transparency everyone in big places is conducting his affairs. Such nonsense is somewhat propagated by Wessel -- it is not by Lewis. Wessel states the facts blandly in casino terminology and quickly moves on to the political maneuvers that really interest him: "Firms that had bet one way with Lehman could settle up with firms that had bet the other way, reducing the eventual burden on the bankruptcy court. Some did, but not many" (Wessel 188).
Here is the difference between reporting styles: Lewis gives the story behind the story -- illustrating what caused the crash, who was on top of it, who got caught under it, who watched, who prophesied, who ignored. Wessel reports from the other side of the field: his work is information with judgments set aside, even the most basic. While journalists like Taibbi find it hard to control their rage and reflect in their writing the fact that they are beside themselves with anger, Wessel is strangely subdued in his analysis, allowing himself to describe such scenes as the hypocrisy that allowed the meltdown to occur with remove and slight indifference. After all, it would be difficult to cast Bernanke, Geithner, and Paulson in the heroic role were he to take a more critical approach to the narrative -- as it is, he has his work cut out for him already, attempting to convince the world that "in Fed we [can still] trust." How he goes about doing so is seen in descriptions like this:
The havoc in the financial markets didn't leave Bernanke, Geithner, or Paulson much time for contemplation. All three men could see another big plane -- AIG -- about to crash. Worse, the engines on the two remaining independent investment banks, Morgan Stanley and Paulson's former employer, Goldman Sachs, were now sputtering.
It became apparent to Bernanke that the government was now in the business of forcing instant mergers to save and restructure the American financial system. Bernanke wondered: What is going to solve this? What is going to stop this? As the deal to save Lehman Brothers fell apart, he had an epiphany: 'That weekend really hit home to me that this was a fiscal issue.' (Wessel 189)
It was not. It was an accountability issue. To have his hero say such an idiotic thing and count it as an epiphany shows the lack of depth in Wessel's journalism. Lewis is able to pump more epiphanies into his first two pages than Wessel is able to give in two hundred -- and that is because Wessel is all surface, much like Sorkin. To say that the collapse was a fiscal issue and chalk this up as an epiphany is outrageous. To have such a thing be said by the head of the Fed and chalk it up to an epiphany is untenable. It is unaccountability plain and simple -- and that is the reason, as Lewis makes clear early on, that everything happened the way it did. Ponzi was unaccountable back in the 20s. Wall Street, the Fed, and the White House were unaccountable from the 80s on. And they will continue to be so -- because there is no power on earth big enough to demand accountability from them. The people? Far from it -- such patriotism does not get you far these day. Accountability will have to come from God Himself.
In conclusion, the three books by Sorkin, Wessel, and Lewis offer three different looks inside the economic crash of 2008 -- and each gives its own accounting. Lewis offers the best vision of what true accounting looks like: it looks like Eisman, a man who has his head on squarely. Wessel gives the best vision of what people who do not like Eisman want that accounting to look like: they want it to look like Bernanke, Geithner, and Paulson know what they are doing and doing it the best way they know how -- for the good of America. The fact is they do what they do for the good of themselves, because that is their world vision -- self-centric. Sorkin's vision is not too much different -- it is lost in the forest, unable to see it for all the trees. Such details as Sorkin and Wessel offer are helpful for knowing the history with greater depth, but it is the right-thinking perspective of Lewis that helps supply what is missing -- a worldview that works.
Lewis, Michael M. The Big Short: Inside the Doomsday Machine. New York, NY: W.
W. Norton & Company, 2010. Print.
Sorkin, Andrew. Too Big to Fail: the inside story of how Wall Street and Washington
fought save the financial system -- and themselves. New York, NY: Penguin, 2010. Print.
Wessel, David. In Fed We Trust: Ben Bernanke's War on the Great…