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Naomi Klein's "The Shock Doctrine":
Corporatism in Extremis


By Bernard Weiner
Co-Editor, The Crisis Papers


April 15, 2008
 

Most of the books I've read about the awfulness of the Bush presidency remind me of the old story about the blind men trying to figure out what an elephant looks like. Each one feels the part in front of him and describes the elephant within that singular context. The blind men's descriptions are correct but they don't really capture "elephant-ness," the totality of what such an animal might be.

"The Shock Doctrine" by The Nation/Guardian writer Naomi Klein gets the pieces of the elephant right, but, more importantly, the book displays the author's deep understanding of the dangerous political/economic philosophies that undergird U.S. domestic and foreign policy.

In this, "The Shock Doctrine" is the most compelling, intelligent, meticulously researched and holistic book I've yet read about how the U.S., over the past fifty years, got itself into the unholy mess it's in today.

In this, "The Shock Doctrine" is the most compelling, intelligent, meticulously researched and holistic book I've yet read about how the U.S., over the past fifty years, got itself into the unholy mess it's in today.

A large part of Klein's book, as you might guess, involves the catastrophe that is Iraq and the "war on terror" in general. But those military misadventures, she says, are but symptoms of the more all-encompassing ideological mindset that breeds the reckless policies being pursued today both domestically and internationally.

PROFITEERING ON HUMAN TRAGEDY

In the main, that ideology rests on a narrow, greed-oriented economic and political philosophy that barely recognizes the concept of a "public good." Instead, the goal is what can be gained by private corporations and individuals if the "public good" is removed from the equation so that "free market" forces are permitted to act unconstrained.

The idea is to return to some imagined "clean slate" where those free-market forces can be allowed to do their stuff absent governmental interference and oversight. The economic "shock therapy" visited upon developing Latin American countries and the Iraq War/Occupation provide just two examples of such human intervention.

Often, however, Mother Nature through earthquakes, hurricanes, floods, etc. wipes the slate clean so that the greed paradigm can be allowed to flourish by removing (usually poorer) residents who get in the way of corporate desires. Klein incisively and movingly relates the tale of what happened in Sri Lanka in the wake of the tsunami disaster, where the local fishing villages were turned into luxurious tourist sites by money-hungry government officials in cahoots with Western developers. (Page 385)

Klein uses the term "disaster capitalism" to refer to these "orchestrated raids on the public sphere in the wake of catastrophic events," where the forces of greed view such tragedies "as exciting market opportunities." (p.6) She quotes a Republican leader in Louisiana: "We finally cleaned up public housing in New Orleans. We couldn't do it, but God did." Katrina, Klein says, is a clear example of the new "preferred method of advancing corporate goals: using moments of collective trauma to engage in radical social and economic engineering." (p.8)

In short, in "disaster capitalism" there are huge profits to be made from other peoples' misery, and since the welfare of the public is of no import in this economic/political theory, all that is needed for full control and enhanced profits are ways to optimally manage that misery.

MAN-MADE TRAUMA AND CHAOS

If nature doesn't provide that trauma, humans can. According to Klein, that's what "Shock & Awe" was all about in Iraq and which will be used in other attacks as well. The idea is to traumatize an entire culture through death, destruction, deprivation, fright, and often torture. One U.S. entrepreneur in Iraq stated it baldly: "fear and disorder offer real promise" in the marketplace. (p.9) This is reminiscent of Condoleezza Rice's famous comment after 9/11 that the terrorist tragedy offered conservatives a good "opportunity" to move quickly on their business and political agendas.

Much of the rationale for this type of thinking was born from Milton Friedman's economic model developed at the University of Chicago in the 1950s and beyond. Klein, oddly enough, doesn't even mention the complementary teaching by political philosopher Leo Strauss, the Machiavellian godfather of neo-conservative extremism, who also was on the Chicago faculty; many of Strauss' students became key players in the CheneyBush Administration. Strauss in a nutshell: grab what you can get by whatever means necessary.

While Friedman's tough, corporate model can be, and has been, imposed on democratic cultures, Klein notes, "authoritarian conditions are required for the implementation of its true vision." (p.11) And thus aggressive, tough strictures are often employed, often by dictators or invading armies or world financial institutions.

In non-dictatorships, government (which takes its cues from public clamor for services) must be effectively neutered or "hollowed-out" over time. The aim is to privatize as many of those public-need functions as possible, so that huge amounts of money can be made and, as it happens, healthy chunks of that cash can then be funneled back into party coffers to aid proponents of free-markets to stay in office and expand their power base. (Conservative activist Grover Norquist aims for the day when government will be shrunken to the point that it can be "drowned in a bathtub.")

In the Bush Administration, Klein writes, "the war profiteers aren't just clamoring to get access to government, they are the government; there is no distinction between the two." (p. 314)

PRIVATIZING GOVERNMENT ITSELF

As we have seen time and time again in the Bush Administration, virtually every possible government function is outsourced to corporate contractors, often with no bidding for those contracts. The middle-class and poor get stomped on and squeezed, but the corporate behemoths and multinationals -- the Bechtels and Halliburtons and Blackwaters and KPMGs -- make out like bandits. Graft and corruption are built into the system, with billions simply disappearing into corporate black holes, with the Administration conveniently looking the other way. And the general public, of course, winds up paying for all this transfer of wealth and is left holding the bag in the form of lack of spending on public needs and infrastructure upkeep and a huge debt burdening future generations.

"A more accurate term for a system that erases the boundaries between Big Government and Big Business is not liberal, conservative or capitalist but corporatist," writes Klein. (p. 87) (Mussolini described this amalgam of government and business as fascism.)

"Its main characteristics are huge transfers of public wealth to private hands, often accompanied by exploding debt, an ever-widening chasm between the dazzling rich and the disposable poor, and an aggressive nationalism that justifies bottomless spending on security. ... Other features of the corporatist state tend to include aggressive surveillance (once again, with government and large corporations trading favors and contracts), mass incarceration, shrinking civil liberties and often, though not always, torture." (p. 15)

At times, Klein seems to be suggesting that such behaviors are but unfortunate and accidental by-products of over-zealous free-marketeers, but mostly she leans in the direction of a conscious conspiracy on the part of the corporatist manipulators of the economy and body politic. For example, she says, "the extreme tactics on display in Iraq and New Orleans are often mistaken for the unique incompetence or cronyism of the Bush White House. In fact, Bush's exploits merely represent the monstrously violent and creative culmination of a fifty-year campaign for total corporate liberation." (p.19)

LATIN AMERICA AS CHICAGO LAB

Milton Friedman's economic model, engineered by his former students (Klein calls them the "Chicago Boys") placed in key countries around the world, rested upon, to use Friedman's words, inflicting "painful shocks: only 'bitter medicine' could clear those distortions and bad patterns out of the way." (p. 50) But time after time when economic shock therapies were tried out in the real world -- downsizing government, eliminating millions of jobs, deregulation of industries, etc. -- the resulting social chaos and dislocation were so horrific that the experiments had to be trimmed back or reconfigured, often using the very Keynesian mixed-economy approaches that are anathema to the Friedmanites.

The first public laboratory for Friedman's drastic economic model was Latin America in the '50s and '60s and then beyond: Iran, Indonesia, former colonies in Africa, etc. But, says Klein, rather than encourage and bring democracy to Guatemala, Brazil, Argentina, Chile, et al., the result was the CIA-engineered "overthrow of democracy in country after country. And it did not bring peace but required the systematic murder of tens of thousands and the torture of between 100,000 and 150,000 people." (p. 102)

Iraq, she indicates, is merely the latest manifestation of what happens when private profit and private power are the be-alls and end-alls of government policy, complemented by imperial hegemony resting on a belief in American "exceptionalism."

"As proto-disaster capitalists, the architects of the War on Terror are part of a different breed of corporate-politicians from their predecessors, one for whom wars and other disasters are indeed ends in themselves. ... That's because what is unquestionably good for the bottom line of these companies is cataclysm -- wars, epidemics, natural disasters and resource shortages. ... Public service is reduced to little more than a reconnaissance mission for future work in the disaster capitalism complex." (p. 311)

SHOCKING & AWING IN IRAQ

Nowhere is this more evident that in Iraq, which contains all four of those calamities (war, epidemics, natural disasters and resource shortages) in one convenient location:

"After the crusade had conquered Latin America, Africa, Eastern Europe and Asia, the Arab world called out as its final frontier...The architects of this invasion were firm believers in the shock doctrine -- they knew that while Iraqis were consumed with daily emergencies, the country could be discreetly auctioned off and the results announced as a done deal."

"The architects of the war surveyed the global arsenal of shock tactics and decided to go with all of them -- blitzkrieg military bombardment supplemented with elaborate psychological operations, followed up with the fastest and most sweeping political and economic shock therapy program attempted anywhere, backed up, if there was any resistance, by rounding up those who resisted and subjecting them to 'gloves-off' abuse...[an] experiment in mass torture for months." (p. 331)

Torture and the other dislocations usually occur early as a demonstration model; the extreme maltreatment is not aimed solely or sometimes even mainly at those persons tortured or killed, but are designed to stimulate a general sense of chaos and fright and to "destroy the parts of society that those people represent," such as resisters, political activists, or labor organizers. (p. 101)

So why did the U.S. Occupation go so badly? One could name a host of reasons, but certainly a huge one is an obvious blind spot in the theory of American exceptionalism:

"It was this theft of Iraq's reconstruction funds from Iraqis, justified by unquestioned, racist assumptions about U.S. superiority and Iraqi inferiority -- and not merely the generic demons of 'corruption' and 'incompetence' -- that doomed the project from the start. (p. 347) ... It was straight-up corporate gorging on state coffers." (p. 355)

"[The Bush Administration} had commissioned a kind of country-in-a-box, designed in Virginia and Texas, to be assembled in Iraq. ... Iraqis did not see the corporate reconstruction as 'a gift': most saw it as a modernized form of pillage," in cahoots with a corrupted Iraqi government bureaucracy. (p. 347) At that point, a huge number of those disenchanted, angry Iraqis joined the armed rebels.

RENTING-BACK ESSENTIAL SERVICES

So what lies in store for the future, now that so many major countries are little more than national-security police states, with their traditional governmental public-service functions outsourced or otherwise "disappeared"? Klein looks into her crystal ball:

"The next phase of the disaster capitalism complex is all too clear: with emergencies on the rise, government no longer able to foot the bill, and citizens stranded by their can't-do state, the parallel corporate state will rent back its own disaster infrastructure to whomever can afford it, at whatever price the market will bear. For sale will be everything from helicopter rides off rooftops to drinking water to beds in shelters." (p. 319) Blackwater providing armed guards in post-Katrina New Orleans was just the tip of the iceberg (p. 421), or Sandy Spring, GA., where the entire city government is run by the private corporation CH2M Hill.

"But the [disaster] industry has far greater ambitions, including privatized global communication networks, emergency health and electricity...the contracting-out of police and fire departments to private security companies...and the ability to locate and provide transportation for a global workforce in the midst of a major disaster. ... [We are witnessing] the expansion of the narrow military-industrial complex into the sprawling disaster capitalism complex. Today, global instability does not just benefit a small group of arms dealers; it generates huge profits for the high-tech security sector, for heavy construction, for private health-care companies treating wounded soldiers, for the oil and gas sectors -- and of course for defense contractors." (p. 420)

And the stock markets reflect that reality, rising as disasters occur. Says Klein: "Shock-therapy 'reforms' have been the crack cocaine of financial markets." (p. 87)

COUNTERING THE GREED MERCHANTS

Can anything be done to counter the rise of the national-security/disaster-capitalism states? Klein says the blowback is already happening against disaster-capitalism all over the globe, but is most clearly evident in Latin America where leaders and populations are rebelling against U.S. hegemonic desires and harsh IMF policies. They are learning to "build shock absorbers into their organizing models," Klein writes. (p. 453)

In Europe, two countries (France and Holland) rejected the European Constitution, the French because they saw that document as "the codification of the corporatist order," what they called "savage capitalism." More and more grassroots-generated collectives are being started in Brazil to reclaim unused land, and in Argentina hundreds of bankrupt companies "recovered" by their workers have been turned into democratically-organized cooperatives. (p. 455)

These are small steps, to be sure, but they may represent strong, active anti-disaster capitalism tectonics about to emerge. Certainly, the appearance of this brilliantly argued book is a giant and necessary step in turning this country, and the world, around.


Copyright 2008 by Bernard Weiner

 


Bernard Weiner, Ph.D., has taught government & international relations at universities in California and Washington, worked as a writer/editor at the San Francisco Chronicle for two decades, and currently serves as co-editor of The Crisis Papers (www.crisispapers.org). To comment: crisispapers@comcast.net .
 


Crisis Papers editors, Partridge & Weiner, are available for public speaking appearances