The release of The Big Short, which I saw last week, gives me a moment to connect it with another film that bookends the long financial crisis that started in the 1980s. I watched Trading Places again recently 30 years after it was released, and with the benefit of hindsight it seems like a harbinger for the “gilded age” and its less gilded aftermath.


Pygmalion-plus

At the time it seemed funny but slightly old-fashioned, reusing what looked like a classic plot device from the heyday of 1940s film, with shadows of Pygmalion and the Mark Twain story The Prince and the Pauper. It’s an all-star vehicle: Dan Ackroyd, Eddie Murphy (before he became a caricature), the fine character actors Ralph Bellamy and Don Ameche, Jamie lee Curtis and Denholm Elliott, all directed by John Landis.

The story (spoilers): the absurdly wealthy commodity traders Duke and Duke decide for a bet to see if they can take Eddie Murphy off the streets and turn him into a commodities dealer, while also—not so Pygmalion—turning their preppy office manager (Ackroyd) into a desperate criminal.

Harbinger of a boom

From a creative point of view, the plot hums along and the script, by Timothy Harris and Herschel Weingrod, is so full of good things that it’s something of a master class. The Duke brother who has bet on nurture rather than nature wins it, but in the hearing of Murphy, which drives the plot towards a happy ending in which their cruelty is punished (and I won’t say more about that here in case you decide to watch the film again).

So why does it now seem like a harbinger for the long financialised global boom, and the increases in inequality that went with it?

Three or four scenes do it for me.

❯ When the Duke brothers are explaining to Murphy how their business works, taking a commission for clients whether they’re selling or buying, he says, “You’re just like bookies.” This is an echo of Keynes’ remark that the Stock Exchange was like a casino, and a pervasive idea in The Big Short: the people who are “shorting” the market, in other words betting that it’s going to fall, wonder repeatedly who is on the other side of their bet. (Towards the end, they find out).

❯ When Ackroyd is pawning his $7,000 watch after he has lost his house, fiancée and credit cards, he has a wonderful exchange with the pawn broker:

WINTHROP: This is the sports watch of the ’80s. $6,955 retail.
PAWNBROKER: Got a receipt?
WINTHROP: Look, it tells the time simultaneously in Monte Carlo, Beverly Hills, London, Paris, Rome and Gstaad.
PAWNBROKER: In Philadelphia, it’s worth 50 bucks.

❯ Third, of course, the plot is built around the insider dealing of the Duke brothers – they’re paying someone to feed them the details of the American orange forecasts before the rest of the market knows them. By 1989, when Wall Street comes out, everyone knows that insider dealing is illegal, and the corrupting of the Bud Fox character is shown through the way he moves through grey to dark.

❯ And, throughout, the film reeks of the entitlement of the rich, from the way in which Winthrop Lewis III—early on, before he realises his humbling—talks to the police officer who is booking him (“you are making a career decision here”) to the obnovious preppies who are his circle of friends, to the desperate way in which one of the Dukes tries to get the trading market reopened, just for him, at the end of the film.

The bad guys lose

Trading Places is a comedy, and it follows the rules of comedy. The good guys win, the bad guys lose, and their crimes are appropriately punished.

That, of course, is where it gets disconnected from what actually happened. Just before the film’s climax (more spoilers), Denholm Elliot, the butler, and Jamie Lee Curtis, the whore-with-a-heart-of-gold, each entrust their life savings to Ackroyd and Murphy, now teamed up, to play the orange juice futures market. They win, big.

But perhaps there is another reading of this: that the film plugged directly into one of the founding myths of neoliberalism, that everyone would get to participate in some kind of “people’s capitalism.” In the UK, this myth reached its apogee in the ’80s, during the first great wave of state sell-offs, in which huge swathes of value were transferred from the state to the financial sector under cover of this myth. It is best exemplified by the “Tell Sid” campaign for the British Gas privatisation. How much value was thus gifted to the financial sector undercover of this voter-friendly rhetoric? It’s impossible to tell. But if you have any doubts that the policy was largely for the benefit of the financial sector, this extraordinary Treasury document (pdf)—it reads like a sales pitch for Britan’s privatising skills—should put them to rest.

The interests of Wall Street

As for The Big Short, it captures well—certainly at a visceral level—the way in which the financial services sector in the US has become a form of crony capitalism propped up by the state.

It leaves hanging the question of how that came to happen. Or, to be more explicit, of when and how politicians decided that they should represent the interests of Wall Street rather than their constituents. In the States, the obscenities of its electoral financing system provide some of the answer. It got so it cost too much to run unless you were beholden to the oligarchy, at least until Sanders and Trump came along with their essentially political challenge to some of these financial assumptions.

In the UK, where oligarchy comes a little cheaper, the Conservatives are significantly dependent on the good wishes, and finance, of hedge funds, and are also socially connected as well. For New Labour, it came through some kind of fatal combination of Blair’s desire to belong, and Mandelson’s, and Brown’s misguided belief that the financial sector could help him square the Treasury’s books at no real cost. Money for nothing that will be paid for, expensively, for at least another generation.

But there’s more to be said on this whole question of political capture, perhaps in another post.

The banks have won

Unlike in Trading Places, the financiers ended up enriching themselves with our savings, and at our expense, something that is clear in both the film and the book of The Big Short. The anthropologist Joris Luyendijk reviewed the film in The Guardian.

The banks have won. Not a single “top banker” has been jailed and few, if any, have had to return undeserved bonuses. Measures taken since 2008 are being watered down before our eyes and, most dangerous of all, the deeper causes of the crash remain essentially intact. The Occupy movement should call a reunion so we can have a ceremony to bury all remaining hope.

Even before the financial crisis, the scriptwriters of Trading Places, Harris and Weingrod, returned to a related subject, this time as producers, in a far darker film, Falling Down. In Falling Down, an apparently comfortably-off middle class American gets trapped in a spiral of descent. The first time as farce, the second time as tragedy. There is no happy ending.

The image at the top of this post is from Vintage Movie Posters, and is used with thanks.