He can write about these kinds of people with such skill in part because he is one of them. At a time of peril for his industry, Lewis has managed to build what amounts to a personal empire of long-form journalism, with a Warren Buffett-like collection of brands and eye for the next big thing. “He’s got good instincts for the individual story and for the broader picture of where that story belongs,” says Vanity Fair editor Graydon Carter. “The big story of the day is the world financial crisis, and he’s the most kick-ass business writer out there.” His aptitude for translating and enlivening financial concepts has made him an indispensable observer of the crisis: In May 2010, Politico reported that The Big Short had been name-checked on the official Senate record at least fifteen times since its publication just two months before, and that Hill staffers had been calling Lewis at home for advice.
Johnny Lewis was a Hollywood actor who starred in series such as The O.C. and Sons of Anarchy. He soon began exhibiting troubling behavior that led to a grisly murder:
In late October 2011, Lewis lost control of his Triumph motorcycle near Twentynine Palms. At the hospital the staff checked him for signs of a concussion, but he was allowed to leave after tests came back negative. Michael Lewis, however, noticed that his son’s behavior was becoming erratic and bizarre. Had the accident shaken something loose in his brain? he wondered. The elder Lewis scheduled two MRIs, which Johnny refused to undergo. Friends picked up on Lewis’s change in behavior, too. During an acting class in December, he kept speaking in a vaguely British accent. “I asked him about it because I was confused,” Tucker says, “but he shrugged it off.” By the new year Lewis’s behavior would turn from curious to dangerous.
I’m not sure when Barack Obama first entered my consciousness: whether it was a 60 Minutes segment during the first campaign or reading about him in the July 10th, 2008 issue of Rolling Stone — which, albeit slightly crumpled — remains on our coffee table to this day.
The time leading up to his first election was the darkest period of my life to date and during those long nights in late 2008, I took strength from the enthusiasm surrounding him, his campaign, and his election. The optimism was part antidote to my troubles, part encouragement to move on. Of all the articles written about Obama over the years, the ones that intrigued me most were the ones that helped me get to know the man and what he stood for, just a little bit better.
Thursday, January 19th, 2017 is the last day in office for Barack Obama as the 44th president of the United States. With this reading list we remember the man, his time in office, and take a peek at what’s in store after the White House.
1. “The Conciliator” (Larissa Macfarquhar, The New Yorker, May 7, 2007)
Macfarquhar reports on Obama in action with constituents before being elected president, observing his calm demeanor, “freakish self-possession,” and ability to connect with humans of every description. She describes a man who, early on, eschewed political outrage as an impotent, empty tactic — a distraction to achieving unity.
2. “A Conversation with Barack Obama” (Jann S. Wenner, Rolling Stone, July 10, 2008)
In this wide-ranging interview during Obama’s first bid for president in 2008, Wenner takes us back to the optimism surrounding the candidate and his campaign. They chat about Obama’s three favorite books, musical tastes, pop culture, getting endorsed by Bob Dylan and Bruce Springsteen, and Obama’s overall approach to governing a nation.
3. “Obama’s Way” (Michael Lewis, Vanity Fair, October, 2012)
Michael Lewis spent six months with the president before Obama was elected to his second term in office. Lewis reports on the emotional demands of the presidency, avoiding distraction to save decision-making energy as commander-in-chief, the potentially disastrous human consequences of those decisions, and what the president does to soothe his soul after a particularly hard day.
4. “The way ahead” (Barack Obama, The Economist, October 8, 2016)
In his own words, Barack Obama examines the state of the U.S. economic union, positing that globalization, inclusion, and closing the gap between the richest and poorest Americans will aid U.S. prosperity.
5. “Barack Obama is Preparing for His Third Term” (Jason Zengerle, GQ, January 17, 2017)
Most former presidents avoid the spotlight to spend more time with family and maybe enjoy some golf. Even though Barack Obama is stepping away from political office, he’s gearing up to influence the direction of the United States by advising his successor.
David Dayen | Chain of Title: How Three Ordinary Americans Uncovered Wall Street’s Great Foreclosure Fraud | The New Press | May 2016 | 26 minutes (7,150 words)
Below is an excerpt from Chain of Title, by David Dayen, the true story of how a group of ordinary Americans took on the nation’s banks at the height of the housing crisis, calling into question fraudulent foreclosure practices. This story is recommended by Longreads contributing editor Dana Snitzky.
* * *
How could you not know who I am if you’re suing me?
Lisa Epstein drove down Highway A1A, along the Intracoastal Waterway, back to her old apartment in Palm Beach. At her side was her daughter Jenna, in a car seat; atop the dashboard was an envelope containing the monthly payment on her unsold co-op. Though her house was in foreclosure, Lisa always paid the mortgage on the apartment, her fallback in case of eviction.
Lisa gazed at the water out the window. She never wanted to miss mortgage payments; Chase told her to do it and promised assistance afterward, but then put her into foreclosure. The delinquency triggered late fees, penalties, and notifications to national credit bureaus. A damaged credit score affected a mortgage company’s decision to grant loan relief, which hinged on the ability to pay. Even if Lisa managed to finally sell the apartment, even if she could satisfy the debt on the house, the injury from this “advice” would stick with her for years. Chase Home Finance never mentioned the additional consequences, emphasizing only the possibility of aid. The advice was at best faulty, at worst a deliberate effort to seize the home. Lisa spent a lifetime living within her means, guarding against financial catastrophe. Now Chase Home Finance obliterated this carefully constructed reputation. She felt tricked.
America has a name for people who miss their mortgage payments: deadbeats. Responsible taxpayers who repay their debts shouldn’t have to “subsidize the losers’ mortgages,” CNBC host Rick Santelli shouted from the floor of the Chicago Board of Trade on February 19, 2009, two days after Lisa got her foreclosure papers. “This is America! How many of you people want to pay for your neighbor’s mortgage, that has an extra bathroom and can’t pay their bills, raise your hand!” The floor traders in Chicago, between buying and selling commodity futures, hooted. This rant would later be credited as the founding moment of the Tea Party. And it signified a certain posture toward delinquent homeowners, a cultural bias that equated missing the mortgage payment with failing the duties of citizenship. The indignation didn’t account for mortgage companies driving customers into default. However, lenders welcomed anything that humiliated deadbeats into blaming themselves. In most cases it worked: in the twenty-three states that required judicial sign-off for foreclosures, around 95 percent of the cases went uncontested.
But Lisa had an inquisitive mind. Before she would acquiesce, she wanted to understand the circumstances that led to this lawsuit from U.S. Bank, an entity she had never encountered before seeing it listed as the plaintiff. She had three questions: who was this bank, why did it have a relationship with her, and why was it trying to take her house? Read more…
The crisis in Greece is getting worse. Its people on July 5 voted against the terms of the most recent bailout deal in a referendum, rejecting austerity. If a new deal isn’t reached soon, its government won’t be able to pay its debts and will run out of euros, which many expect it will mean exiting the euro zone. This 2010 Michael Lewis classic for Vanity Fair, “Beware of Greeks Bearing Bonds,” helps explain the current situation:
For most of the 1980s and 1990s, Greek interest rates had run a full 10 percent higher than German ones, as Greeks were regarded as far less likely to repay a loan. There was no consumer credit in Greece: Greeks didn’t have credit cards. Greeks didn’t usually have mortgage loans either. Of course, Greece wanted to be treated, by the financial markets, like a properly functioning Northern European country. In the late 1990s they saw their chance: get rid of their own currency and adopt the euro. To do this they needed to meet certain national targets, to prove that they were capable of good European citizenship—that they would not, in the end, run up debts that other countries in the euro area would be forced to repay. In particular they needed to show budget deficits under 3 percent of their gross domestic product, and inflation running at roughly German levels. In 2000, after a flurry of statistical manipulation, Greece hit the targets. To lower the budget deficit the Greek government moved all sorts of expenses (pensions, defense expenditures) off the books. To lower Greek inflation the government did things like freeze prices for electricity and water and other government-supplied goods, and cut taxes on gas, alcohol, and tobacco. Greek-government statisticians did things like remove (high-priced) tomatoes from the consumer price index on the day inflation was measured. “We went to see the guy who created all these numbers,” a former Wall Street analyst of European economies told me. “We could not stop laughing. He explained how he took out the lemons and put in the oranges. There was a lot of massaging of the index.”
Which is to say that even at the time, some observers noted that Greek numbers never seemed to add up. A former I.M.F. official turned economic adviser to former Greek prime minister Konstantinos Mitsotakis turned Salomon Brothers analyst named Miranda Xafa pointed out in 1998 that if you added up all the Greek budget deficits over the previous 15 years they amounted to only half the Greek debt. That is, the amount of money the Greek government had borrowed to fund its operations was twice its declared shortfalls. “At Salomon we used to call [the head of the Greek National Statistical Service] ‘the Magician,’ ” says Xafa, “because of his ability to magically make inflation, the deficit, and the debt disappear.”
In 2001, Greece entered the European Monetary Union, swapped the drachma for the euro, and acquired for its debt an implicit European (read German) guarantee. Greeks could now borrow long-term funds at roughly the same rate as Germans—not 18 percent but 5 percent. To remain in the euro zone, they were meant, in theory, to maintain budget deficits below 3 percent of G.D.P.; in practice, all they had to do was cook the books to show that they were hitting the targets. Here, in 2001, entered Goldman Sachs, which engaged in a series of apparently legal but nonetheless repellent deals designed to hide the Greek government’s true level of indebtedness. For these trades Goldman Sachs—which, in effect, handed Greece a $1 billion loan—carved out a reported $300 million in fees. The machine that enabled Greece to borrow and spend at will was analogous to the machine created to launder the credit of the American subprime borrower—and the role of the American investment banker in the machine was the same. The investment bankers also taught the Greek-government officials how to securitize future receipts from the national lottery, highway tolls, airport landing fees, and even funds granted to the country by the European Union. Any future stream of income that could be identified was sold for cash up front, and spent. As anyone with a brain must have known, the Greeks would be able to disguise their true financial state for only as long as (a) lenders assumed that a loan to Greece was as good as guaranteed by the European Union (read Germany), and (b) no one outside of Greece paid very much attention. Inside Greece there was no market for whistle-blowing, as basically everyone was in on the racket.
And in this essay published in mid-June, Wall Street Journal correspondent Matina Stevis shares her feeling of impotence as she watches her country struggle.
Elaine Brown is an American prison activist, writer, lecturer and singer. In 1968, she joined the Los Angeles chapter of the Black Panther Party as a rank-and-file member. Six years later, Huey Newton appointed her to lead the Party when he went into exile in Cuba. She was the first and only woman to lead the male-dominated Party. She is author of A Taste of Power (Pantheon, 1992) and The Condemnation of Little B (Beacon Press, 2002). She is also the Executive Director of the Michael Lewis Legal Defense Committee and CEO of the newly-formed non-profit organization Oakland & the World Enterprises, Inc.
Her 1992 autobiography A Taste of Power is a story of what it means to be a black woman in America, tracing her life from a lonely girlhood in the ghettos of North Philadelphia to the highest levels of the Black Panther Party’s hierarchy. The Los Angeles Times described the book as “a profound, funny and…heartbreaking American story,” and the New York Times called it “chilling, well written and profoundly entertaining.” Our thanks to Brown for allowing us to reprint this excerpt here. Read more…
Michael Lewis examines the psychological effects of income inequality. “There is a growing awareness that the yawning gap between rich and poor is no longer a matter of simple justice but also the enemy of economic success and human happiness. It’s not just bad for the poor. It’s also bad for the rich.”
Below, our favorite stories of the week. Kindle users, you can also get them as a Readlist.