Review: The Shock Doctrine–The Rise of Disaster Capitalism

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Shock Doctrine

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5.0 out of 5 stars Easily one of the top ten on the death of the American dream

September 30, 2007

Naomi Klein

I read this book while crossing the Atlantic. The author has done something extraordinary, the equivalent of Silent Spring for industrial-era capitalism as an immoral form of human organization. This book is unique but also tightly linked to the books that I list below.

The conclusion of the book focuses on how Wall Street has discovered how to profit from mega-disasters and financial melt-downs, and contrary to popular belief, Wall Street makes money from these economic down-turns. It is the individual, and the indigenous owners who are forced to sell below market, that lose, every time.

The author’s opening focus is on privatization, deregulation, and deep cuts in social spending, each as mandated by the International Monetary Fund and the World Bank, with other nasty triggers demanded by the World Trade Organization, that have been systematically used to loot entire nations and their commonwealths–this is apart from the immoral predatory capitalism that uses bribes to clear areas of indigenous peoples so they can steal all the gold or other natural resources, and their only cost is the bribe, while the host peoples lose billions in natural resources.

The author teaches us that “disaster capitalism” is the next step above immoral predatory capitalism, in which wars and disasters have been privatized and the global military-industrial-prison-hospital complex has moved one step closer to displacing all governments.

She spends time discussion torture by dictators as a silent partner to the free-market crusade, and this is a good time to mention that the book is a standing condemnation of all that Milton Friedman and “the Chicago boys” inserted into the IMF and World Bank via their students.

She provides a helpful discussion of how believers in Armageddon, including the neo-conservatives, are motivated by the belief that there is such a thing as a clean slate, and that Africa without Africans, or Iraq without Iraqis, are both desirable for that reason.

She does a tremendous job of outlining the three shock waves of disaster capitalism:

1. Government Disaster/War out-sourced
2. Corporate looting
3. Police terrorism

A portion of the book focuses on the urgency of restoring unions and the middle class, unions because they protect fair wages that create a middle class. She stresses that the 1970’s through the 1990’s saw a global (but particularly southern hemisphere) campaign to use the cover of counter-terrorism to murder and terrorize union leaders. As a graduate of the Central American and Andean wars, I can certainly testify to the fact that government death squads were as about looting and killing opposition leaders, and I for one saw no terrorists, only indigenous people’s at the end of their rope.

Interestingly the author singles out visionaries as being among the top targets for being hunted down and “disappeared.” Visionaries counter the government lies that seek to rule by secrecy, impose scarcity, and concentrate wealth within a small elite.

The author damningly documents how eager corporations have been to work with dictators to create police states that eliminate unions and enslave peoples at wages that cannot support a family, much less create a middle class.

She focuses on national debt and on government corruption as the two pillars of social destruction. As a student of E. O. Wilson and Medard Gabel, and many others, I can testify that there is plenty of money for all of us to be virtual billionaires, but it is corruption and greed at the top, enabled by secrecy, that have allowed a handful to create a global class war and impoverish the 90% that do the hard work (see my list on this one).

I am utterly blown away by the author’s overall assessment, in the middle of the book, to wit, that crisis is now used routinely to side-step reasoned democracy and completely halt political and social reform while furthering the ends of those who seek to concentrate wealth and power exclusive of the larger body of We the People.

The author is damning across the board of the failures of neoliberalism, which has been a “second pillage” of the looting of state-owned enterprises, following the first pillage, the looting of the natural resources of the commonwealth being targeted.

As part of this the author explicitly accuses the IMF of deliberately fostering crises in part by fabricating and manipulating statistics, or as the author puts it, “statistical malpractice.”

The author suggests that unlike the Mexican bail-out, when Rubin was seeking to protect Wall Street investments, Asia was allowed to collapse financially because the US wanted to put an end to the prospects of their being a “third” way that was more balanced than either capitalism for the few on one side, or socialism for all on the other. This is especially noteworthy because Latin America is today pursuing a similar “third way” and very likely to succeed.

The author declares that Donald Rumsfeld’s over-riding objective as Secretary of Defense was the privatization of war. The author tells us that he declared war on the Pentagon bureaucracy on 10 September (this is the same day that Congresswoman McKinney’s was grilling him on the missing 2.3 trillion dollars). On 11 September the missile won Rumsfeld his war with the Pentagon bureaucracy *and* it destroyed the computers with all the records on the missing money.

The author goes on to document how the Bush Administration privatized Homeland Security across the board.

As the book draws to a close she reviews the history of corporate-driven foreign policy, summing it up in three steps:

1. Corporation suffers set-back in a foreign country
2. Politicians loyal to the corporation demonize the foreign country
3. Politicians “sell” US public on the need for regime change.

The author scorns political appointees, noting that their “service” these days is little more than a pre-raid reconnaissance.

She concludes by suggesting that disaster apartheid is leaving 25-60% of the populations as an underclass, destroyed middle classes, and creating walled cities for the elite, death and suffering for everyone else. Dubai is one such walled city.

Corporations are red-lining the world, using stocks, currency, and real estate markets to crash economies, buy cheap, and then restore with a sharp re-concentration of wealth.

Ending on a positive note, she suggests that We the People are in the process of reconstructing our own world, and while I did not see mention of the World Index of Social and Environmental Responsibility (WISER) or Interra and the other community-oriented systems, I believe she is correct, and that the Earth Intelligence Network, the Transpartisan Policy Institute, the People’s Budget Office, are all part of taking back the power and the commonwealth.

This is a great and necessary book. Others (the first two DVDs) listed below reinforce her findings.

The Corporation
Wal-Mart: The High Cost of Low Price
The Soul of Capitalism: Opening Paths to a Moral Economy
Confessions of an Economic Hit Man
The Global Class War: How America’s Bipartisan Elite Lost Our Future – and What It Will Take to Win It Back
The Cheating Culture: Why More Americans Are Doing Wrong to Get Ahead
The Working Poor: Invisible in America
Running on Empty: How the Democratic and Republican Parties Are Bankrupting Our Future and What Americans Can Do About It
Breach of Trust: How Washington Turns Outsiders Into Insiders
Vice: Dick Cheney and the Hijacking of the American Presidency

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Sep 30

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