The image for which Matt Taibbi is perhaps best known is in a 2009 article in Rolling Stone magazine, for which he is a contributing editor, where he described Goldman Sachs, the US investment bank, as “a giant vampire squid wrapped around the face of humanity, relentlessly jamming its blood funnel into anything that smells like money”.

Unfortunately, the vampire-squid description is just one example of what is contained in a terrible book. Griftopia (Spiegel & Grau, $26) is a coarse, superficial and one-sided rant that oozes contempt for humanity.

Taibbi does not just hate the leaders of the US Tea Party movement (“egregiously stupid morons”), Sarah Palin (a “dingbat”), Alan Greenspan (“a one-in-a-billion asshole” and a “self-important pseudo-intellectual”) or conservative journalists (he describes one as a “douchewad”). By implication he also despises ordinary people – or “schmuck-citizens”, as he calls them at one point – for their failure to see through the conspiracy. Only he can penetrate the complexities of American finance to reveal the truth.

Yet there is something truly interesting going on here: not the book itself, but the Griftopia phenomenon. Why are such works, usually lacking Taibbi’s bad language but sharing his outlook, taken seriously?

Taibbi’s basic thesis is that a grifter class of financiers has taken over the US. In a classic circular argument, it is both the premise and the conclusion of the book. This power enabled Wall Street to create a massive Ponzi scheme that eventually devastated the US economy. Goldman Sachs is at the centre of this conspiracy.

In this account, the tentacles of finance extend to corrupt the US political system. Not only have senior Goldman Sachs figures held high-ranking roles in US public life, but they were aided by a pernicious free-market outlook. Greenspan not only helped engineer the bubble in his role as chairman of the Federal Reserve, but also provided an ideological justification for it.

In Taibbi’s world, there are two main reasons why the grifter class gets away with it. One is US politics, in particular the Tea Party. He argues that conservative politicians somehow manage to caricature attempts to curb the power of the financial oligarchy as attacks on ordinary people. Most notably, they condemned President Barack Obama, with his mild proposals for healthcare reform, as a socialist. The financiers are also aided by their second favourite weapon: stooge media outlets such as CNBC and Fox News.

To be clear, there is nothing inherently wrong with sketching the role of financial institutions in the creation of the US mortgage bubble. The fundamental problem with Taibbi’s work is that it purports to explain the 2008 financial crash as well as its relationship to the US. Yet any proper examination of these developments would need to be broader and more thorough and open-minded than anything he attempts.

Instead, he has the annoying habit of asserting things are self-evidently true or untrue rather than weighing up the arguments. A typical formulation is to claim in relation to energy that “one thing we know for sure is that the [2008] price increases had nothing to do with supply and demand”. Yet the evidence he gives to substantiate his claim that the price spike should all be blamed on speculation is flimsy at best.

Indeed, Taibbi explicitly dismisses any discussion of economics as unnecessary in explaining the financial bubble, as it was essentially created by a criminal conspiracy. But in reality it makes no sense to examine the mortgage-centred boom in isolation from broader economic factors.

The US authorities helped create the conditions for the credit boom by liberalising lending rules, keeping interest rates low and maintaining high public spending. Their motivation was not free-market ideology or manipulation by finance. Instead, they pursued desperate measures in trying to compensate for the economy’s underlying sluggishness. Rather than tackle some of the US’s chronic economic weaknesses, they took the short-termist option of making credit easier.

Ironically, Taibbi shares key assumptions both with liberal commentators and many of the financial journalists he despises. The tendency to focus obsessively on Wall Street while missing the bigger picture is far from unique to him.

Griftopia is a graphic example of the failure of the critics of mainstream US society to present a convincing explanation of recent events. If the people Taibbi derides as “schmuck-citizens” are not swayed by his superficial arguments, he only has himself to blame.

The writer is the author of Ferraris for All (Policy Press, 2010)

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