Tuesday, September 29, 2009
I have not seen the film, nor any of Moore's past works, for that matter. For that matter, Michael Moore is tangential to the subject of this blog aside from his assertion that capitalism is evil. Scott Cendrowski, reporter for Money magazine, interviewed the controversial liberal filmmaker about the background of the film, and how for the first time publicly, Moore brought up his personal faith as a significant factor in his personal philosophy.
Interestingly, according to Moore, this film was not a reaction to the financial meltdown of 2008, but was in the planning stages well before the crisis. If you want to read the entire interview, please click on the link above.
Overall, in reading the interview I didn't find a great deal of surprises about Moore's philosophy, politics or agenda. He remains at his core a reactionary, knee-jerk, bleeding-heart liberal standing up for the little guy, and wanting to stick it to "the Man."
I'd like to focus on the concept that capitalism as an economic system is evil. I do not believe that assertion, for the simple fact that by and large, I see capitalism itself as a machine, much like a computer. Using the well-worn programmer's axiom "Garbage In, Garbage Out" as an example, I believe the system will yield results relatively consistent with the manner in which it's used. Now, I'm not saying that the results of economic policies and practices are always predictable and reliable. There are thousands of economic departments, doctoral candidates and professors that have been studying economics for centuries, and each of them has a unique view and philosophy on the nature of markets.
To put my personal belief about the nature of markets simply, I believe that excessive leverage and deficit spending, over an extended period, is a recipe for disaster. Knowing full well that our nation has been on this course in regard to federal spending for many decades, I'm bracing myself for what I feel is an inevitable day of reckoning.
I also believe lack of accountability, whether at the level of corporate governance or personal finance, breeds corruption and irresponsibility. An excellent example of which was the subprime mortgage meltdown in which people believed they could perpetually use their home's seemingly ever-rising equity as an ATM machine. Even though historical trends showed the trajectory to be unsustainable.
Not that I want to uphold myself as a great sage of financial markets, but I saw the mortgage market meltdown coming a long ways off. For no other reason that as an average working Joe, making an average working salary, there was no way I could ever hope to afford a home at the inflated prices that were the norm in the middle of this decade. Now, there were plenty of lenders willing to apply exotic, convoluted metrics to make a loan available, none of which I was comfortable with.
Were there a lot of characters involved in some way with the current crisis that consciously and willingly participated in questionable or even overtly illegal activities? Absolutely. But the point I want to end with is that it was fallible human actions and motivations that caused the outcome of the current crisis, for the most part. Did some of these people believe they were doing the right thing?
Certainly in the case of the relaxation of lending standards by congressman Barney Frank and the Clinton administration, the noble intentions of expanding the dream of home ownership to less privileged means had some unintended consequences. So what in the end was more evil? Loosening lending standards to allow those with less money and less sophisticated knowledge and understanding of finance to be approved for loans they likely could not afford? Or denying them that "right" to protect the interests of their investors, shareholders, and responsible homeowners who scrimped, saved and toiled to be able to afford a house the conventional way?