I’ve had ‘The Shock Doctrine’ by Naomi Klein on my shelf for a number of years. I had previously read ‘No Logo’ and as a non academic found her journalistic style of writing quick to digest, informative and well researched.
And so – because I had run out of books – I picked it up which is no mean feat as it is over 500 pages big. By the time I had read 10 pages I was already questioning my naivety in regards to the mainstream media and realising how absolutely ignorant I was of the big global economic picture; the global economic imperative Klein calls ‘Disaster Capitalism’. There are no accidents in Klein’s world. She begins her thesis by taking us to New Orleans after the destruction of the city by Hurricane Katrina. At the time it was generally regarded as a prime example of the incompetence of the Bush administration but in Klein’s eyes we are given the alternative view; one that shows it to be a categorical success for the Neo – Liberal right as many poor black residents were expelled from their homes to make way for new developments and most of the city’s public schools were replaced by privately run charter schools.
The Shock Doctrine is by bookended by New Orleans. From the disaster of Katrina we are brought through the torture and killings under Augusto Pinochet in Chile, the military dictatorship in Argentina and Indonesia, the fall of the Soviet Union and finally to Iraq. At the heart of all of these ‘shock therapies’ is the economist Milton Friedman and his acolytes ‘The Chicago boys’ (Friedman was head of economics in the University of Chicago), a free market capitalist and hero of the Neo – Liberal right. It is Klein’s contention that their fanaticism and absolute adherence to the policy of de –regulation, privatization, labour flexibility and massive spending cuts has led to this corporatist agenda which we now see all over the world, not least in the policies of the IMF and World Bank.
Like any good journalist Klein travels the world to find out firsthand what really happened on the ground during the privatization of Iraq, the aftermath of the Asian tsunami, the continuing Polish transition to capitalism and the years after the African National Congress took power in South Africa, when it failed to pursue the redistributionist policies enshrined in the Freedom Charter, its statement of core principles. These chapters are the least exciting parts of the book, but they are also the most convincing. In the case of South Africa, she interviews activists and others, only to find there is no one answer. Busy trying to stave off civil war in the early years after the end of apartheid, the ANC didn’t fully understand how important economic policy was. Afraid of scaring off foreign investors, it took the advice of the IMF and the World Bank and instituted a policy of privatization, spending cutbacks, labour flexibility and so on. This didn’t stop two of South Africa’s own major companies, South African Breweries and Anglo-American, from relocating their global headquarters to London. The average growth rate has been a disappointing 5% (much lower than in countries in East Asia, which followed a different route); unemployment for the black majority is 48% and the number of people living on less than $1 a day has doubled to four million from two million since 1994, the year the ANC. took over.
Klein believes that neo-liberalism belongs among “the closed, fundamentalist doctrines that cannot co-exist with other belief-systems … The world as it is must be erased to make way for their purist invention. Rooted in biblical fantasies of great floods and great fires, it is a logic that leads ineluctably towards violence.” As Klein sees it, the social breakdowns that have accompanied neo-liberal economic policies are not the result of incompetence or mismanagement. They are integral to the free-market project, which can only advance against a background of disasters. In other words, these disasters are manufactured as part of a deliberate policy framed by corporations with hidden influence in government – an absolutely frightening thought.
Even if you don’t agree with that summation Klein goes on to say that disaster is part of the normal functioning of the type of capitalism we have today:
“An economic system that requires constant growth, while bucking almost all serious attempts at environmental regulation, generates a steady stream of disasters all on its own, whether military, ecological or financial. The appetite for easy, short-term profits offered by purely speculative investment has turned the stock, currency and real estate markets into crisis-creation machines, as the Asian financial crisis, the Mexican peso crisis and the dotcom collapse all demonstrate.”
Part of the power of this book comes from the parallels she observes in seemingly unrelated developments. In a fascinating and alarming examination of the underside of recent history, she notes the affinities between the policies of shock therapy imposed in the course of neo-liberal market reform and the techniques of torture that have been routinely used by the US in the course of the “war on terror”.
But has the free market experiment failed? As Klein sees it, free market shock therapy may actually have succeeded in achieving its true objectives. Post-invasion Iraq may be “a ghoulish dystopia where going to a simple business meeting could get you lynched, burned alive or beheaded”. Even so, Klein points out, Halliburton is making handsome profits – it has built the green zone as a corporate city-state, and taken on many of the traditional functions of the armed forces in Iraq. An entire society has been destroyed, but the corporations that operate in the ruins are doing well.
Klein’s message, then, seems to be that – at least in its own, profit-centred terms – disaster capitalism works.
Kleins thesis is partisan. There will be many who would absolutely refute her claims, accuse her of being over simplistic, etc, etc however it is fair to say that her meticulous research has opened a new window of understanding into the global machinations that affect our daily existence.
When Dr. Tom Clonan reviewed this book in The Irish Times he said on Klein’s central argument: “Neocons see the ideal ratio of super-rich to permanent-poor as consistent with an uber-class of business oligarchs and their political cronies from the top 20%”. The remaining 80% of the world’s population, the “disposable poor”, would subsist in “planned misery” unable to afford adequate housing, privatised education or healthcare”
In this time of deep, long term economic crisis we must be vigilant
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