Book review: Griftopia by Matt Taibbi

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      Published by Spiegel & Grau, 252 pp, hardcover

      Bile is the fuel of American politics these days, but it doesn’t usually enter serious writing about the financial industry and the state of the economy. You don’t usually see phrases like “crude oil prices” and “full of shit” on the same page, or “effective tax rate” and “completely fucked”. But you do in Matt Taibbi’s latest book, Griftopia: Bubble Machines, Vampire Squids, and the Long Con That Is Breaking America.

      This willingness to play dirty has brought the Rolling Stone journalist lots of attention in recent years, much of it hostile. Even Goldman Sachs CEO Lloyd Blankfein had to react when Taibbi described the investment bank as “relentlessly jamming its blood funnel into anything that smells like money” in a 2009 magazine feature that’s been updated for inclusion here. But focusing on the insults and expletives means neglecting the weight of the author’s attack on Wall Street’s high-rollers and the financial implosion they caused in 2008.

      Taibbi traces the whole sordid thing back to former U.S. Federal Reserve chairman Alan Greenspan, a man once fatuously nicknamed “the Maestro”. Most financial writers would consider using a phrase like “A Giant Stumbles” to title a chapter about Greenspan’s rise and fall, but Taibbi calls his own chapter on the subject “The Biggest Asshole in the Universe” and proceeds to build his case by describing Greenspan’s formative love of Ayn Rand and comical record as an economic forecaster. As Taibbi recounts, Greenspan was for decades praised as the architect of great surges in the American economy, accomplished largely by deregulating the financial industry and maintaining bizarrely low interest rates. But what Greenspan actually created, Taibbi notes, was a string of old-fashioned, textbook-worthy economic bubbles, the last of which wound up driving the world’s economy into a marsh of subprime mortgages.

      Putting the rhetorical boots to laissez-faire money men and the deregulators who love them is standard work for left-leaning pundits, but Griftopia makes a defiant point of being nonpartisan. Taibbi readily shows sympathy for Tea Party members enraged by the bank bailouts and accuses Barack Obama of being two-faced in the debate over health-care reform in the U.S. Indeed, the author’s central idea is that party politics is aimless as long as “there are really two Americas, one for the grifter class, and one for everybody else”—meaning everybody outside a stratospherically wealthy network of financiers and lobbyists in Manhattan and Washington, D.C.

      “We no longer have the attention span to deal with any twenty-first-century crisis,” he writes. “We live in an economy that is immensely complex and we are completely at the mercy of the small group of people who understand it—who incidentally often happen to be the same people who built these wildly complex economic systems. We have to trust these people to do the right thing, but we can’t, because, well, they’re scum.”

      That final jab is typical of Griftopia. It’s a move Taibbi pulls throughout the book, and it sometimes comes off as bad-boy posturing. Even so, next to the actions of those who knowingly made rigged or insanely sloppy bets on millions of citizens’ homes and livelihoods, it hardly counts as outrageous.




      Dec 12, 2010 at 10:09am

      Recommend reading another great Matt Taibbi article: Looting Main Street: how the nation's biggest banks are ripping off American cities with the same predatory deals that brought down Greece.
      Article depicts life in Third World America after predatory bankers and corrupt politicians bankrupted cities and municipalities with complex financing deals. for example: Sewer system with estimate of $250 million balloons to $5 billion. Public services cut to the bone to pay debt. Sewer bills of $14.71 per month swell to $64.00 per month. Insightful and forewarning article.


      Dec 15, 2010 at 2:24pm

      Thanks for above Taibbi's old blog. Max Keiser's rant is right on....