Monday, January 02, 2012

Book Notes: The Shock Doctrine by Naomi Klein

During the Cold War era, the lines were drawn clearly. On one side stood communism, state-control of the economy, and lack of human rights and freedoms; while on the other side stood freedom, democracy and capitalism. The cold war narrative (at least as told in the West) was that this meant that freedom and democracy are the natural (indeed inevitable) partners of capitalism. The fall of  Russian and Eastern European communism was naturally interpreted through this prism. Likewise, when the Tienanmen Square protests began to gather strength the assumption made here was that the Chinese were striving for the political and personal freedoms which normally accompany free market economics. In "The Shock Doctrine",  "No-Logo" author Naomi Klein systematically demolishes this narrative, and reveals the extent to which the radical free-market principles espoused most notably by Milton Friedman, have most-often been the natural bedfellows of terror, human-rights, abuses, dictators, and corporations profiteering from war and natural disasters.

The "Shock" referred to in the title is a comparison Klein draws repeatedly on. She describes the CIA sponsored psychiatric experiments of the mid-20th Century in which doctors attempted to shock, disorientate, memory-erase, and then rebuild patients. Initially this was trialled as a treatment of psychiatric illnesses, but was also associated with attempts to break captured enemy combatants. Klein suggests that over the last half-century, 'disaster-Capitalism' has used exactly such tactics on whole societies, using (or creating) catastrophes in order to force through unpopular economic 'reforms' on disorientated populations. These 'reforms' are typically vast cuts in social spending, privatisation of state-assets, access to land and resources for Western Corporations, low tax-rates in regressive tax systems and multi-billion dollar contracts for Western Corporations to 'rebuild' after the disaster. Typically, such policies result in a wealth bonanza for shareholders in the disaster-capitalism elite, but vastly accelerated differentials in wealth in the reconstructed country. Where electorates will not vote for these policies but prefer even moderate Keynesian alternatives, pressure from international money -markets, IMF/World Bank ensure compliance. In the most extreme cases, democracy has been crushed by force to facilitate the forward march of disaster capitalism. This is Klein's thesis.

In chapter after chapter of tightly argued and extensively footnoted prose, Klein demonstrates the coherence and veracity of her central contentions. She takes the reader through South America in the 70s where social-democratic governments were overthrown by American backed free-market dictators like the murderous Pinochet; charts the ways in which Solidarity in Poland, and the ANC in South Africa have abandoned the manifestos on which they were elected and succumbed to IMF 'Shock-therapy'.  She details the way in which Yeltsin was able (during his war with the Russian parliament), to use the shock of conflict and the suspension of democracy to force through the deeply unpopular privatisations of state utilities which created the infamous Russian multi-billionaire's of today. Needless to say there is little evidence of any 'trickle-down' of this wealth to the Russian people. Klein also shows the way in which natural disasters such as the tragic Tsunami were seized upon by the disaster-capitalism complex to drive their agenda forward against the wishes of the victims of the destructive wave. She documents the struggles of many indigenous peoples to re-build their homes (such as Sri Lankan fishing communities) when their land has been given to Multinational corporations to redevelop as tourist attractions using Western aid money. 

Perhaps the most shocking of all Klein's case studies is that of Iraq, and the Bush regime's privatised war which created a national 'shock' with which to rebuild the country as a free-market test-case for the Middle East. Klein documents the way in which the multi-nationals and mercenaries who fought much of the war were accountable neither to US or Iraqi law, whose conduct was frequently appalling but whose owners harvest multi-billion dollar profits. The scandal of the 'reconstruction' of Iraq in which billions of dollars of Iraq's oil wealth was harvested to allow firms like Haliburton to impose their plans on the populace is a terrifying read.

There are places where Klein undoubtedly asserts more than she demonstrates, in the case of her chapter on Israel and Palestine she's probably guilty of some significant over-simplifications, and on a few occasions some fairly significant factual claims aren't footnoted. Nevertheless, this book is a devastating indictment of the amorality of so much of the world economic system. What is perhaps most surprising is the reaction of surprise that this book seems to have generated in so many reviews. I must admit that I had always assumed that economic policy was the driving force in the conquest of Iraq, and that the world was full of corporations ready to profiteer from the misery of millions. 

In the final chapter of the book, Klein looks to highlight what she sees as hopeful signs of alternatives. She rejoices when she sees developing countries in the two-thirds world seizing the initiative and managing their own economic fortunes. Direct bartering deals between South American countries for commodities such as Oil or trained medics without reliance on the volatile manipulations of the international markets. When Klein published in 2007 she was able to trace what she described as positive signs of a post-shock alternative arising. IMF and World Bank Friedmanite loan and reconstruction shock packages were steadily reducing as she wrote. Five years later, as the world economy enters another year of crisis and countries across Southern Europe face severe shock, Klein's book makes essential and urgent reading. Economies and even currencies may collapse and reconstruction may have to happen - but whose reconstruction, and how it will be carried out will be matters of utmost concern. Klein argues that 'disaster capitalism' is poised to exploit crises for its own ends; real participative democracy must also therefore be as well prepared for the forthcoming conflicts.

On a more personal note, I have been involved with discussions on another blog about the attempts of the Christian-right in the USA to baptise capitalism as "Christian". This was I suppose understandable in the Cold War era, when there was a correlation between market-economies and religious freedoms, and the atheist propaganda and persecution that accompanied Marxist-Leninist government. Today however, I think that such schemes are deeply flawed because they are based on a series of errors. These include:

 (i) Various financial systems existed across Bible times.The Bible neither discusses socialism nor capitalism as we have it today, but it does deal in detail with the ethics with which wealth and money should be handled within whatever system we find ourselves. The leap from this textual data to an unequivocal endorsement of the late 20th Century American experience seems to be a capitulation to ethnocentric hermeneutics of breathtaking proportions. The idea that one economic model is to be imposed in all times and places, is one which resonates strongly with free-market fundamentalists, and with their Marxist protagonists - but is not  something which is found in the Bible. Western Capitalist theologians need to hear the voices of their brothers and sisters in the two-thirds world and ask why they read the same texts so differently. 

(ii) Christian proponents of Capitalism claim to be defending the principles of human responsibility and fairness of the free market, but in fact are apologists for Multi-national Corporatism, whose interest in profits and market domination skews market freedoms so that what exists in practice usually looks nothing like the theoretical model defended. 

(iii) The Bible is uniformly condemning of money-lending with interest, something which is intrinsic to contemporary notions of 'enterprise'. Christian-capitalists need to spend so much effort qualifying and avoiding these texts that they have tacitly admitted that there is a serious disjunction between their model and biblical norms. 

(iv) While the social-justice models applicable to Israel in the Old Testament cannot simply be applied to contemporary secular society as if it were God's Covenant people; the prophecies of men like Amos do still reveal something of the unchanging character of God - as revealed in those specific circumstances. We cannot therefore abandon all notions of equity as limited to that time/place and those recipients but should weigh contemporary options in the light of the broad outlines of how God requires that we live in His world. 

(v) The Reformation doctrine of Total Depravity emphasises that all aspects of our humanity have been tainted by the 'fall', and that not one area is unaffected by it. This means that all parts of our lives, (mind, emotions, bodies etc etc) have been influenced by sin. However it must also mean that all human endeavours and systems fall short of the standards of God's holiness. I am very suspect of any theologian who is 'courageous' enough to say that  all human economic arrangements are sinful - except the one which is benefiting me and my country right now! It seems like a refusal to adequately apply the doctrine of Total Depravity to ones own culture. The gospel of Jesus Christ stands above all cultural ferment and socio-economic battles, and must be seen to be so. If the American Christian right is allowed to weld their economic model onto the gospel as if they were one, the consequences for Christianity could be disastrous. If modern consumer-capitalism turns out to be the greatest human endeavour in the Tower of Babel tradition yet, and it falls spectacularly; what will be left of the church and the Christian witness to the saving power of Christ? 


1 comment:

Simon said...

That's an interesting read. Just recently I had a facebook discussion on what our successors will look back on with in 100 years with disgust. Our total and unashamed integration with a consumerist economy and society may be one, especially with the promotion of it via "Christmas".

For me the take away from that article is that too often we take our status quo and manipulate scripture to match. We need to learn that everything we have come to do traditionally, whether economically, socially or within the church is up for discussion.