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Sundance Review – The Flaw

When former Federal Reserve Chairman, Alan Greenspan, was being question by the US Congressional Committee investigating the worldwide financial crises in 2008, and was asked if his ideology pushed him to make decisions that he wished he hadn’t have made, Greenspan responded: “Well, remember that what an ideology is, is a conceptual framework with the way people deal with reality. Everyone has one.  You have to – to exist, you need an ideology. The question is whether it is accurate or not.  And what I am saying to you is, yes, I found A FLAW. I don’t know how significant or permanent it is, but I’ve been very distressed by that fact.”

The goal of this documentary, The Flaw,  by director David Sington, a former Audience Award winner at Sundance for his feature documentary In the Shadow of the Moon, was to find this fundamental FLAW that Greenspan mentioned.  While Sington confesses that he is not an economist, he was able to interview world-renowned economist and people who are at the highest level of finance because of the connections the London investors of this film had.

In this fascinating and educational documentary, Sington shares his research with us in an entertaining, down to earth kind of way. He weaves the expert opinions of Nobel laureate Joseph Stiglitz, housing expert Robert Shiller and economic historian Louis Hyman, together with Wall Street Insiders and victims of the crash to help us understand the complexity of this crises and some of the primary causes.  In-between these interviews he imports slices of cartoons, old clips and charts to give a historical and comic dimension to the film, which made these 82 minutes, feel like 28 minutes.

Sington, who considers himself right of center (he is a Tory, politically speaking), thinks that the fundamental flaw that caused this financial disaster is “believing that asset markets would behave like good markets” which creates a consumer economy driven by debt, where because of the increasing income inequality, most people are tempted to purchase goods using credit cards and other kinds of loans.  This in turn leads people to invest more in debt, making bankers and banking a much more profitable field.  As a result, he says (during the Q & A), “We have built a system where capital is invested in debt, rather than invested into the productive capacity of the country.”

While I am not able to comment on the economic merits of this documentary, I found what he had to say in my personal interview with him after the film incredibly enlightening.  He said that one of the important facts he wanted to point out in the film is how the growing income inequality distribution “where the rich get richer”, is a major flaw in our unchecked capitalistic system.  He mentioned the kind of income inequality that has been developing in America over the last thirty years is the kind of thing you see in underdeveloped countries.  “One of the first things you want underdeveloped countries to do is build a middle class.” He feels that America is regressing and becoming more of an undeveloped country in this way.  One of the most interesting things he told me in my interview is that while he doesn’t consider himself a leftist, he thinks the economy should be more equal, not for moral reasons (like those on the left) but for economic reasons.

In the general Q & A time Sington said that the making of this film has changed his politics.  He says, “I’m beginning to be a little more sympathetic to my left wing friends.  I certainly changed my view about the role of government in the economy.”

I give the documentary 5 out of 5 stars because it has increased my appetite to study economics, to understand how the growing income inequality in America has added to our current crises as well as investigate ways in which unbridled capitalism can be tamed for the good of all. Economic justice is a topic that each of us should concern ourselves with.

The Flaw was acquired by New Video, which plans to release the film on DVD, cable video-on-demand and digital distribution.

Venue: Sundance Film Festival – Yarrow Hotel Theatre – Park City, Utah
Category: World Cinema Documentary Competition
Date Viewed: Tuesday, January 25th at 3 p.m.
Director/Screenwriter: David Sington
Executive Producers: Stephen Lambert, Christopher Hird, Luke Johnson
Associate Producers: Sarah Kinsella, Heather Walsh, Celine Fitzmaurice
Cinematographer: Clive North
Editor: David Fairhead
Composer: Philip Sheppard
Animation: Peter J. Richardson

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