The inside story of America’s economic ‘fire fighters’
Arvamus 30 Dec 2009  EWR
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Andrew Ross Sorkin entertainingly describes the dithering and panic at the heart of the US financial system as the 2008 banking crisis unfolded, but is too generous to those who allowed it to happen in the first place.
Sean Collins, Spiked Review of Books

‘Paulson, who had been living on barely three hours of sleep a night for a week, was beginning to feel nauseated. Watching the financial industry crumble in front of his eyes – the world he inhabited his entire career – was getting to him. For a moment, he felt light-headed. From outside his office, his staff could hear him vomit.’

Andrew Ross Sorkin’s Too Big to Fail provides a richly detailed, behind-the-scenes account of the unravelling of the financial crisis in the US in 2008. Puking, swearing, infighting – it’s all here. Sorkin, a New York Times journalist, gained remarkable inside access to the key players. His book reads like a gripping novel, and he manages to keep the dramatic tension high even though we know the outcome.

Too Big to Fail focuses on the US government’s response to the crisis, from the aftermath of the Bear Stearns rescue in March 2008 to capital infusions directly into banks in October 2008. The central character is the treasury secretary, Henry Paulson, with support from Federal Reserve chairman Ben Bernanke and New York Federal Reserve head Timothy Geithner (who is now treasury secretary under Obama). Sorkin also draws detailed portraits of the leading bankers, especially the gloomy head of Lehman Brothers, Dick Fuld, who becomes something of the villain of the piece.

Sorkin’s tale is useful because it provides raw material for understanding how American government officials sought to respond to this extraordinary crisis. A number of people have credited the US authorities with taking decisive action to prevent the system from collapsing. In particular, Paulson and Bernanke’s establishment of the $700billion Troubled Asset Relief Program (TARP) is often cited as a creative and daring move to stabilise the financial sphere. But Sorkin’s tale reveals the opposite: a disoriented and panicked group of regulators whose actions were dithering and indecisive.

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