"In contrast, Inside Job is all about assigning blame. The documentary makes a moralistic case that the crisis was all the fault of Wall Street villains and their helpers. To be sure, mistakes can cross over into villainy - some creators of toxic securities must have known that they were not doing God's work. But Inside Job takes this to a populist extreme, assuming malevolent motivations and spattering blame through ambush interviews of hapless crisis participants who agreed to speak on camera (I took a pass when the filmmakers called me in the spring of 2009). The portrayal of Eliot Spitzer is especially ironic, with the former New York Governor shown as a saint commenting on all the sinners.
In truth, the striking feature of the crisis was how many different people committed mistakes: banks and other firms made bad loans and packaged them into subprime securities; rating agencies rubber stamped them as AAA; pension funds bought the junk assets; government officials missed the mounting problems; and so on. But surely also at fault are the multitude of individual homebuyers who turned into mini-speculators during the housing bubble. These folks are off the hook in Inside Job."
Phillip Swagel is a non-resident scholar at the American Enterprise Institute and a professor at the University of Maryland's School of Public Policy, where he teaches courses on international economics and is a faculty associate of the Center for Financial Policy at the Robert H. Smith School of Business. He was Assistant Secretary for Economic Policy at the Treasury Department from December 2006 to January 2009.