We were pretty big fans of The Price of Loyalty, Ron Suskind's book about George W. Bush's first treasury secretary, Paul O'Neil, and the first media source to really question the run-up to the Iraq War. So we were extremely excited to see that Bush's last treasury secretary, Hank Paulson, had written a memoir. Not because we were expecting a tell-all account of the real origins of the Bear Stearns sale, TARP, TARF, and all the other acronyms that came to define the crisis, but rather because On the Brink heralded the emergence of a new and great literary genre: books by and about former Bush treasury secretaries. John W. Snow, our nation turns its lonely eyes to you!
Sadly, though, as an account of the financial crisis On the Brink comes up woefully short. All the events are there, sure—even described in dizzying detail. Paulson tries to avoid complex financial language and numbers in order to make the book intelligible to laymen (the infamous Joe Six-Pack, proud Tea Party member), but he still presents agencies and metrics in rapid-fire succession without introduction, offering financial figures and politicians one after another without explication. The problem with Paulson's book is a surfeit of information: the only narrative is the calendar, and without narrowing his account to a few events, it's often hard to tell what Paulson believes were the pivotal moments and true origins of the credit crisis.
Paulson opens the book by explaining that he doesn't take notes or keep a journal and that the book is largely composed from memory, yet the problematics of memory hardly matter here. There are no points of obscurity or uncertainty in the truth of his words, and there are very few attempts at real reminiscence, at capturing the feeling of what it mean to be there at that time—just a few meaningless adjectives of doubt, and scattered lines about betraying his free-market beliefs only because it was absolutely necessary to pull us off THE BRINK. It's a feint to the memoir, rather than an embrace of the form. No, the guiding metaphor for On the Brink is the call log: the endless list of names that provided Paulson's source material, sequences of detail instead of a filtered product.
Still, there are some very well-drawn moments in the book, such as Hank's description of the AIG bailout, not to mention the book's high point: the political battle over TARP. (You remember, when John McCain suspended his presidential campaign to "solve" the financial crisis.) At these points, Paulson slows down enough to add exposition, to introduce the figures affecting the decisions and uncover the human drama involved. Unfortunately, the book's occasional successes only underscore its general (flat) shape.
We've stressed the point of narrative because Paulson himself identifies the need to understand the events that transpired, distinguishing between the proximate causes of the crisis and the embedded problems waiting to ignite—yet he himself rarely looks past the general consensus. He joins in the argument that there was a regulatory breakdown, but he doesn't ask what enabled that breakdown. It wasn't just that the regulatory system failed to keep pace with the financial system, but that the agencies were defanged by twenty years of deregulation. Paulson's indignant that House conservatives blocked TARP and other "solutions" to the crisis out of pure free-market ideology, but he doesn't ask how the culture of blind ideological purity was engendered in the first place.
No one is expecting Hank to have been a secret follower of Paul Krugman, but if anyone was in the position of making an appeal for economic pragmatism, it was Paulson. At the very least, he could have used the form of the memoir to slow down and reflect on the larger causes.
Paulson can be a good writer when he restricts himself to a limited word count and a set topic. The afterword is a well-reasoned introduction to regulatory reform—a topic he wrote about recently in the Times—and, again, there are excellent sequences in the book. But those looking to understand what happened and why we entered such a deep recession should look elsewhere. Those who want to find out who Hank Paulson called when should buy this book.
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