Too Big to Fail

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(342)

Andrew Ross Sorkin, Penguin, £14.99

Too Big to Fail soon developed another title in my head: "Why Socialists Yell Jump to Bankers". This book claims to be a moment by moment account of the greatest financial crisis since the Great Depression. However, it turned out to be full of tittle-tattle and gossip.

We discover that Erin Callan, the chief financial officer for Lehman Brothers, is concerned that she won't be able buy her dream apartment once the financial crisis hits. We learn that Hank Paulson leaves the door open when he goes to the loo and that he is passionate about the environment. We are even told where Tim Geithner of the New York Federal Reserve gets his hair cut. This can give us a glimpse into the lives of these incredibly wealthy and arrogant bankers but it at no point helps us understand what happened to cause the crisis.

If the lives of these financial wizards were compared with the lives of working class Americans it could have been a powerful indictment of the huge gap between the rich and the poor in the US.

When I was told that Callan fought back the tears as she resigned I wanted to fling the book across the room. Callan will be OK! Sorkin simply does not mention the effect that the financial crisis will have on ordinary people. The hundreds of thousands of people who faced homelessness are absent, those whose pensions were wiped out have vanished and those who lost their jobs are nowhere to be found.

The lack of analysis of how the financial crisis occurred is a problem. It is sometimes mentioned that there wasn't enough regulation on the banks but why this led to the crash is not explained. Sorkin doesn't mention that the same people running around trying to solve the crisis are the people who argued for less regulation.

For the banking industry the lack of analysis in this book must be the book's appeal. Business Week actually argued that this book could become required reading for colleges in the future.

Any real analysis has at least to rock the boat. In 2007 the World Economic Forum named Sorkin a Young Global Leader and Vanity Fair named him as one of 40 new members of the "Next Establishment". If the role of the New Establishment is to protect the old order he has done his job well.