Disaster Capitalism   Leave a comment


In 2007 Author Naomi Klein’s third book The Shock Doctrine: The Rise of Disaster Capitalism became an international best seller and was translated in 20 languages. Today she seems as much seer, sage, authentic psychic as author. Her predictions are coming true.

Klein was the average teenager in the mid to late 80s hanging out in malls and searching for clothes with designer logos, which meant the clothes were expensive and the buyer suckered in as a free walking/wearing advertisement for corporate giants who pay workers little for their labor, such as the children in Thailand stuffing, cutting, dressing and assembling Barbie dolls. Dolls that these child laborers never get to play with while they toil in high heat with hardly a break. But before Naomi Klein learned of the sweatshops and child labor creating the clothing she purchased, life changed.  Her mother had a stroke, which caused Klein to quit hanging out at the mall being “such a brat” and join her physician father and brother in caring for her mother in their home. Klein waited to attend college so she could be home that year and care for her mother.

Klein wrote the The Shock Doctrine after doing four years of historical research and on-the-ground reporting in disaster zones. Her theory is that after disasters such as Katrina’s devastation in New Orleans, war, or terrorist attacks when the public is stunned by the occurrence, that is when unpopular economic changes, or what Klein calls shock therapy, is pushed through by those in power.

She believes this backdoor entry to making changes that work against the public but for corporations can be traced back to the Milton Friedman teachings at the University of Chicago School of Economics. His influence is still felt around the world.

Klein gives the example such as when victims of Katrina were moved to various places around the country after the disaster, their public housing, some of which was still livable, their schools and hospitals were not reopened. Milton Friedman, age 93 at the time of the hurricane wrote an op ed piece for the New York Times. His idea – instead of using some of the billions of dollars in reconstruction money to improve New Orleans existing public school system – the government should provide families with vouchers, which they could spend at private institutions, many run for-profit, that would be subsidized by the state. Bush backed this idea with tens of millions of dollars to convert New Orleans schools to charter schools, publicly funded but run by private entities that make their own rules. This idea obliterates any civil rights gains that guarantee children the same standard of education. Klein reports that considering the snail’s pace to rebuild New Orleans’ levees and get the electricity grid back in place, the auctioning off of the city’s school system happened with military speed and precision. New Orleans’ teachers who were once represented by a strong union had a shredded union contract and all it’s forty-seven hundred members were fired. Some of the younger teachers were rehired at reduced salaries. Housing that was undamaged or slightly damaged and which people could have returned to was torn down and the land snapped up by corporations to build hotels and resorts. Klein saw this in Sri Lanka after the 2004 tsunami. The Sri Lankan government declared that out of the tragedy would come a world-class tourism destination. It all sounded so positive, but the reality was that the entire beautiful coastline was handed over to entrepreneurs and foreign investors and blocked hundreds of thousands of fishing people from rebuilding their villages near the water, and so destroyed the livelihood and self-sustaining way of life that they knew.

Klein’s book is full of examples of mega disaster, real or media-enhanced, being used for superprofits by corporations and the United States Government working hand in hand to the detriment of the poor and middle class. The three trademarks of disaster capitalism are privatization (ask any therapist in town how privatizing Health and Human Services foster care system is harming children in Scottsbluff, NE), government deregulation (fraudulent Wall Street Bankers receive huge bonuses following losses by homeowners), and deep cuts in social spending (do you have a family member using Medicare, Medicaid, Social Security, Headstart, Special Ed?).

The United States Government tested these Friedman theories for the last 40 years in South American countries. Klein writes that Friedman first learned to exploit a large-scale shock or crises in the mid-seventies when he was advisor to dictator General Augusto Pinochet. The Chilean people were in a state of shock after Pinochet’s violent coup (supported by the U.S. and CIA). The country was also experiencing hyperinflation created by billions in World Bank loans, which usually included a structural adjustment policy (SAP). These SAPs have to do with privatization of resources. Friedman advised the evil dictator to impose a rapid-fire transformation of the economy – tax cuts, free trade, privatized services, cuts to social spending and deregulation. Public schools were replaced with voucher-funded private ones. This extreme capitalist makeover was known as “Chicago School” revolution since so many of Pinochet’s economists studied under Friedman who coined the term “shock treatment” for this tactic, because the swift economic shifts cause psychological reactions that facilitate the adjustment. Pinochet used torture cells. Thirty years later this formula emerged with greater violence in Iraq. September 11th provided just the megadisaster that provided the Bush presidency, which was packed with Friedman cronies, to turn the people’s fear of Weapons of Mass Destruction and create “The War on Terror.” Bush immediately outsourced to corporations like Blackwater and Halliburton (Cheney) to create an almost entirely for-profit venture of war. Just what Eisenhower warned against in creating a military-industrial complex where a global war is fought on every level by private companies whose involvement is paid for with public money.

What Governor Walker of Wisconsin is doing is another example of how the shock doctrine works. Governor Walker campaigned on popular items like tax cuts but never mentioned taking away collective bargaining. Then once in office, he exaggerates the budget issue, and manufactures a crisis insisting that a bill be passed immediately taking away worker’s rights, but Walker had already cut taxes for the rich even more.  Naomi Klein is excited about the people’s fight in Wisconsin. She states, “What this fight is really about is not unions vs. taxpayers, as we’ve been told. It’s a fight about who is going to pay for the crisis created by the wealthiest elite in this country.”  “Is it going to be regular working people? Or is it going to be the people who created this crisis? That’s the debate we need to have.”


Posted March 19, 2011 by strongjacksonpoet54 in Essays

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