Free-Market Mischief in Hot Spots of Disaster
Festivalgoers in Venice and Toronto who attended the premieres this weekend of “The Shock Doctrine,” a six-minute film written by the author Naomi Klein and the director Alfonso Cuarón, saw images of electroshock treatments from the 1950s, animated pages from a C.I.A. torture manual and footage of the 9/11 attacks and the 2004 tsunami. The brief movie encapsulates the thesis of a new book of the same title by Ms. Klein: That unconstrained free-market policies go hand in hand with undemocratic political policies.
While Mr. Cuarón’s political passions can be glimpsed in his dystopian 2006 thriller “Children of Men” (Ms. Klein is a commentator on the DVD), most Hollywood directors don’t end up making promotional videos for thick texts about global economics. “When she asked if I was interested in doing a trailer,” he said from Italy, “my answer was, ‘I’m sorry, I can’t do it.’ “
Then Mr. Cuarón read the book: “I had to call her back. I said, “Naomi, please don’t drop this. You - we - have to do this.” He drafted his son Jonás to direct. (The film can be seen on her Web site, naomiklein.org.)
While perhaps not quite as powerful a marketing tool as having Victoria Beckham photographed reading “Skinny Bitch,” it’s not bad. Yet this sort of fortuitous event seems regularly to happen to the 37-year-old Ms. Klein.
Her book “No Logo” was at the printer just as young demonstrators rioted in Seattle in 1999 to protest the World Trade Organization meeting there. Overnight Ms. Klein, with her dark eyebrows and youthful intensity, became both a spokeswoman for and analyst of the anti-globalization movement that caught fire around the world. That book sold more than 1 million copies worldwide.
“The Take,” her 2004 documentary about a workers’ cooperative in Argentina produced with her husband, Avi Lewis, was being filmed when Carlos Saúl Menem, the former president who had presided over that county’s economic collapse, unsuccessfully attempted a dramatic comeback. Argentina was where Ms. Klein began to formulate her argument in “The Shock Doctrine: The Rise of Disaster Capitalism,” being released in the United States on Sept. 18.
“I felt it emotionally before I understood it factually,” Ms. Klein said during a recent visit to New York from her home in Canada. It was “blindingly obvious” to everyone there, she said, that there was a “connection between violence, the military coup and these economic policies that people didn’t want.”
In her book she argues that the shock therapy prescribed by Western economists during the last 30 years could not have been imposed without political shock therapy, namely brutal repression and a suspension of democratic rights. Western countries, along with the International Monetary Fund and the World Bank, essentially exploited disasters - hyperinflation, the tsunami, the war in Iraq - to force through radical changes like privatization, deregulation and severe cuts in social spending. These policies, imposed by foreign and American disciples of the laissez-faire economist Milton Friedman, she maintains, caused grinding poverty and hardship for millions while often permitting multinationals to buy up a country’s most valuable assets for going-out-of-business prices.
Even the shock of 9/11, she said in an interview, was “harnessed by leaders to end the discussion of global justice.”
Nor are democratic governments exempt. Solidarity in Poland in 1989, she writes, was forced to reverse positions on which it was elected - i.e., backing worker cooperatives - and impose a state of emergency after being strong-armed by the I.M.F. and other lenders that refused to extend aid and credit unless Poland adopted a radical free-market program.
“We did not lose the battle of ideas,” Ms. Klein likes to say. Alternatives to the free market were “crushed by army tanks and think tanks.”
Her unconventional take is sure to stir criticism. Yet holding politically unpopular views is something of a family tradition for Ms. Klein. Her parents went to Canada, where she was born in 1970, so her father could avoid the Vietnam draft. Her family later moved back to the United States but returned to Canada when her father, a doctor, decided he wanted to work in a public health system. Her mother belonged to a feminist filmmaking collective.
Ms. Klein wrote for the campus newspaper while at the University of Toronto in the mid-1990s, but was dispirited by the left’s seeming malaise. There was a “smallness to our politics,” she said of the preoccupation with race, gender and ethnicity. When she returned to school a few years later, she met a group of younger activists who were excitedly organizing around globalization.
As Ms. Klein talks about protests, one can see her enthusiasm about the power of mass mobilization. In her public speeches, like one she gave at the American Sociological Association conference this summer in Manhattan, she seems as interested in promoting activism as in promoting her book.
“We are missing movement power,” she complained. “Fixing the world’s problems has become an increasingly elite affair - a matter between C.E.O.’s and celebrities. It’s noblesse oblige on a large scale.”
That comment is a pointed jab at the globe-trotting economist Jeffrey D. Sachs, who has recently enlisted Bono in an ambitious campaign to end global poverty. In her book Ms. Klein partly blames Mr. Sachs for the disastrous results in Russia and wrenching deprivation in Poland and Bolivia, where he was an adviser.
“There’s a theme which I broadly agree with that the extreme free-market reform ideology of the 1980s and onward really got out of hand,” said Mr. Sachs, who is director of the Earth Institute at Columbia University. But “she didn’t really understand a lot of things that happened in the places I was involved.”
The zeal of the free-marketers is so great, Ms. Klein declares, that if a natural or financial disaster fails to materialize, economists and policy officials help precipitate one. In her book she quotes a speech delivered by the economist John Williamson in 1993: “One will have to ask whether it could conceivably make sense to think of deliberately provoking a crisis so as to remove the political logjam to reform.”
She points out that the International Monetary Fund’s own auditing arm criticized the fund’s approach after it forced Asian governments to accept shock therapy during the 1997-98 financial crisis. More than 24 million people across Asia lost their jobs.
The demands were “ill-advised” and “broader than seemed necessary,” Ms. Klein writes, citing the audit, which concluded that “crisis should not be used as an opportunity to seek a long agenda of reforms just because leverage is high, irrespective of how justifiable they may be on merits.”
Mr. Williamson, a senior fellow at the Peterson Institute for International Economics, has not read the book, but after a brief description said, “It doesn’t sound like she has a full appreciation of my position.”
Anders Aslund, also at the Peterson Institute and the author of a forthcoming book, “Russia’s Capitalist Revolution: Why Market Reform Succeeded and Democracy Failed,” labeled a description of Ms. Klein’s argument as “complete nonsense.”
“If you don’t do anything, you have the state managers take over,” he said, citing Uzbekistan and Belarus as places where halfway economic measures were tried and resulted in dictatorships. Political scientists are at fault, he said, because they haven’t “got a clue about how to build a democracy.”
Ms. Klein, who was heartily attacked for “No Logo,” is not unaccustomed to criticism. But she added that then, “I had a movement on my side.” This time, she said, “I think this will be a lot lonelier.”
© 2007 The New York Times Company
‘In her book she quotes a speech delivered by the economist John Williamson in 1993: “One will have to ask whether it could conceivably make sense to think of deliberately provoking a crisis so as to remove the political logjam to reform.”’
Who has to PROVOKE a crisis? Mother Nature has got a whole series of them ready to unleash on us — and not a moment too soon, say our politicians and the corporate elites who own them.
I’m so grateful to Naomi for this book, as I’ve been preaching on this doctrine to my classes since 9/11. My students all think I’m just an old paranoid Leftie, but perhaps now they’ll pay some attention.
If you read Naomi’s *Harper’s* article back in 2004 (a piece I give to my students as required reading), you’ve got the drift of the book. Here’s the URL:
http://www.harpers.org/archive/2004/09/0080197
Why is the market free only for those who control it?
The NYT writer, Cohen, is primarily a culture writer, not an A Section “world news” writer or a book reviewer. That shows because she fails to show the kind of contemp and ridicule that the NYT usually shows for this kind of book and clip and devotes most of the article to presenting Klien’s thesis in the book, views and past work. The writer does present near the end of the article several economists critical of the Klein and no economists who support Klein, but that is far too sympathetic a treatment for the kind of attack on the system that Klein offers. In short, I would have expected a much more effective hit piece from the NYT, but I will chalk it up to the inexperience of a culture writer who is not sufficiently versed in our country’s free-market economic orthodoxy. More specifically, the problem seems to have been that the culture/film people at the NYT got a hold of the book because of the brief promotional clip for the book, not the NYT book review people, who would have likely given the book to an outside economics expert to trash it, if they chose to review the book at all.
“Free market” is an oxymoron. Free-anything is a philosophical/logical non-sequitur or violation of a basic law of a physics. As practiced, “free market” is based on an extraordinarily assymetrical defense of power. The powerful are more organized. Indeed, they’ve organized a sufficient number of the powerless to police themselves, against themselves.
So it’s not a free market. It would be free only if the powerless were free to employ the same sort of coercive techniques the powerful use. Then we’d have a perfectly free market: genuine anarchism. This remains, and has been since the Middle Ages, a controlled market. The presence or absence of controls in particular places serve only to benefit the already-powerful.
“The needs of 3000 corporations destroyed Chile for a generation when on September 11, 1973, they began the war against the democracy of Salvador Allende’s government. Families lost 30,000-40,000 killed and torture ruled the day.
The needs of 3000 corporations are biting the hands that feed them by destroying the American worker and the American family.
This September 11th, let us come together to denounce again the actions of American exploitation at home and abroad. Let’s end poverty in the USA by supporting workers and worker’s rights.”
What Naomi seeks to reveal is true. As a child, I intuitively knew this was what would come of us. And now, I bow my head — in shock that all this came so soon - so fast. What I did not envision was the alignment and submission of the masses in such a lock-step of compliance. To overwhelm the brain and captivate the mind in fear while isolating the person — is the embodiment of dehumanizing a humanity and a society. This, along with a societal mantra of Thatcher’s “T.I.N.A.” — (There Is No Alternative) — and you ultimately have a societal program of compliance — in which the external police authorites are no longer needed — as the fear for survival serves to internally regulate the individual into a state of child-like compliance.
Well, here we are — all reactive and poised for a good shocking whenever the powers that be push the button.
One final comment, did anyone else also note how strange it was that Osama somehow surfaces again to scare us — just like Goerge Bush and company endlessly seek to scare us — in good timing to the hearings about the effectiveness of the surge — and how these hearings are all timed around the mournful anniversay of 9/11?????
This is one shock that is no longer inspiring my awe.
ALOHA !!
GOVERNMENT IS ONLY AS HONEST AS ITS MONEY …
Why does everyone think all this is new? Its about “money” not globalization. Here is a quote from the ultimate banker and founder of the Rothschild Bank empire that still exists today some 300+ years later …
“Give me control of a nation’s money and I care not who makes it’s laws.”
- Mayer Amschel Bauer Rothschild
In essence we vote the same two party aristocracy into power that is controlled by these same elite banking empires that financed both sides of the Colonial War in 1776 as well as the French Revolution and the War Of 1812 and every other war since then up to Iraq! Wars are highly profitable for banks and defense contractors and not much else …
When was the first time the USA ventured into the Arab world with our Navy? Was it WW1 or WW2 or Kuwait? No it was 1805 during the First Barbary War. The Tripoli lyrics in the Marine’s Hymn …
THERE IS NOTHING NEW UNDER THE SUN !!! Especially the part where the rich rob from the poor and the Superpowers plunder the small countries …
I have to agree with Klein this whole thing about Bono and Oprah saving us all with Barrack or whoever their celeb politico du jour is is a laughable joke! We will be on the road to saving ourselves when we dump anything and everything that begins with Dem or Rep! Then we can clean house with the Federal Reserve and the “counterparty” banking elites! Wilson and FDR sold us out a long time ago …
Paul Bramscher - Thanks for pointing out the misleading nature of the expression “free market”. Only living beings can be free, certainly not markets but the term is of course used deliberately to force opponents of this ideology onto the defensive, it was designed to manufacture consent (Orwell would have loved it….)
Freedom is a universal value so anybody who rejects concepts sold with the “free” label is automatically the bad guy. A more adequate description is “self-regulating” market, but the utopia remains the same. (as brilliantly explained in these books: THE GREAT TRANSFORMATION by Karl Polanyi and FALSE DAWN by John Gray)
You are also right about the extreme disparity of market power which produces conflict, exacerbates inequality and poverty and leads to political and religious extremism. Only after they had come to dominate the world market did the leading economic powers promote “free-trade”. Their own dominance had of course only been achieved by immense protectionism and brutal violence (in the context of colonialism).
Summing up, the “Washington Consensus” (again to be read in the Orwellian sense) means “some are more equal than others” when it comes to enforcing man-made “economic laws”.
Polyani wrote his book in the same year as Friedrich von Hayek´s famous “The Road to Serfdom” which is a kind of Bible for the “Chicago boys” like Milton Friedman. He realized already in 1948 that self-regulating markets are a dangerous fantasy that leads to the destruction of social cohesion and the natural environnment. His thesis is that to achieve such a system man,nature and money must be turned into pure commodities which they are obviously not. (Commodities are defined as things produced for sale and their price is regulated by demand and supply). While for centuries markets were always embedded in societies, this ideology requires that all social relations must be subordinated to the “needs” of the market (read financial markets) with fatal consequences to the fabric of society. (The first application of these principles lead to the First World War, the second was a major (though not the only)contribution to the rise of fascism). The latest version called “globalization” is also wrecking havoc with the livelihoods of millions of people… (e.g. thousands of farmers have committed suicide in India because they can no longer pay their debts…in India, the booming economy…)
Critics of Naomi Klein´s thesis use the old tactic of calling it a conspiracy theory. A sinister story of indoctrinated economists and their political cronies organizing cataclysms and abusing natural disasters to shock the public into obedience.
But she only confirms what Polanyi claimed: These policies are so unjust that they generate massive resistance and counter-movements. In the past people were not so well informed but today (thanks to the internet) even in developing countries they know what is going on. Iraqis for example are not stupid, they know that their state was destroyed to take control of its assets. Who needs a huge fortified “embassy” and permanent military bases to spread democracy?
So whenever the word “freedom” is used remember that they are talking about the freedom of investors to make profit at all costs. About the freedom of powerful nations to violate human rights, international law and everything human dignity means in order to dominate the world. Forget human rights. This is the age of property and “financial” rights.
The “neo-liberal” creed is based on a very negative perception of humanity: men is by nature selfish, greedy and aggessively pursuing his own interests, and 19th century thinkers used false biological analogies to justify the brutal economic policies. They went so far as to maintain that hunger and misery are the only incentives to make people work, “nature´s way” to control population, etc. so helping the poor is wrong. (That they were poor as a result of economic and social policy not because they were in some ways inferior, was an unwelcome thought and therefore dismissed). (Little understood) biology was misused to make market rules appear as a natural force.
Only an idiot can believe that the unbridled pursuit of personal profit can lead to prosperity for all. Creating a “bigger cake” does not help because a small power elite will simply get bigger slices and the rest will have to be content with the crumbs….
Freedom without Justice leads to chaos.
minitru,
The free-anything class of problems is well-known to philosophy, though Western philosophy typically isn’t interested in solving anything. For that, I’d turn to mathematics and logic. It turned out with free-will, for instance, that in order to be genuinely free, it would need to be free from all chains, including reason (and “will” itself). Or that it would require omniscience in order to make the perfectly reasoned decision. “Free-” demands a singularity of one sort or the other, and these don’t apparently exist in the real world.
Same applies to “free-market”. Not free from just everything, it’s only free from ethical, humanitarian, environmental, safety, consumer and related regulatory constraints.
So we should have a “free consumerism” as well. Consumers should be free to take something that endangered them, ripped them off, etc. and demand 100% refund plus damages. If the courts cannot deliver, it would be fair to extract it extra-legally, through the same lack of regulation that the supply-side initially enjoyed.
A number of excellent, thought-provoking posts here. I’d like to draw a distinction between free-market capitalism (or self-regulating-market capitalism, as minitru calls it)on the one hand versus the neo-liberal, neocon free market capitalism as practiced in/by the US.
A free-market economy presupposes no concentrations of economic power: if any individual player can exert ANY influence over the marketplace, it is no longer free.
A true free market, though it reduces people and labor to “commodities” is not inherently evil, only amoral. It results in an “efficient” allocation of resources and in an overall improvement in standard of living (if not necessary quality of life.)
In a true free market you don’t have multinational conglomerates, you don’t have collaboration between government and business interests, you don’t have lobbyists, and you don’t have something like GM reaching out to kill its own electric car; the one, single promising product that it has manufactered in the last 30 years.
But that’s what we have in the US. Greg Pallast refers to it as “corporatopia” which I believe is a more apt label than “free-market capitalism.”
Ms Klein’s ideas seem to start with a false assumption which means they are not very useful. There are no unconstrained free market policies here. The US government subsidizes and regulates every aspect of business for the benefit of a few favored industries and companies. If she can’t even get her definition of the problem right, how can she possibly offer any solutions?
Many good points about the “free market.” As some have explained here, there are so many flaws in the concept as understood and practiced in the US (philosophical problems with “free,” the mercantilist approach in the US with government aid to the well-connected, the concentration of economic power, …) that any well-educated person with some reasoning skills should be able to dismiss its validity out of hand.
However, the concept has come to be used in the US as a sort of political tool to herd the poorly educated “middle-brow” Americans into the conservative camp. They are convinced “all is well” and that there is no other way to go as they accept their low status in the corporation-dominated economy, and even act as foot soldiers to defend the interests of those they have come to believe are their “betters.” The corporate media has grown to serve as corporate propagandist to constantly break down resistance and get the American masses to accept this view of economic and social reality without serious discussion, and to fear ridicule if they express any thoughts outside this narrow view, and also to ridicule others for doing so.
WmC and others:
You are right of course, there is no “free market” in the absolute sense neither in the US nor anywhere else and we should stick to the term “market liberalism” instead.
Polanyi stresses that “prior to our time no economy has ever existed that, even in principle, was controlled by markets” and that gain and profit never before played such a dominant part in human economy. The concept of the “Economic Man” adopted by the classical economists is false: man is first and foremost a social being and even today when consumerism has reached unprecedented heights, the motivation for buying and wanting so many things in the general public is not greed but enhancing social prestige which the PR industry knows very well.
For centuries production was organized around social principles and the welfare of the community was the most important one. The word economy derives from the Greek oeconomia which means householding in the sense of producing and storing necessary things for the members of a group or a community.
Organizing all production on the principle of gain (ever increasing profits) is a motive peculiar to capitalist markets, it undermines democracy and will in the long run destroy a humane society (first victim: solidarity). To enforce market rules globally undemocratic, unaccountable institutions (like the WTO) had to be created and others, like the IMF (created for another purpose) were abused to help unwilling countries into “the golden straitjacket” (as Thomas Friedman put it so nicely).
If they fail there is - in certain cases - the not so “hidden fist” of Lockheed Martin and others to accomplish the mission. For more sophisticated countries “think tanks” will do the job and convince governments that deregulation and privatization is the latest fashion to reduce government spending and the best way to undermine the bargaining power of labour organizations. From their point of view a growing “reserve-army” of unemployed or underemployed people is not a bad thing since is puts constant pressure on those who still have jobs amd makes them more obedient. The Eastern expansion of the EU “common market” is a good example since the great wage disparities can be exploited to drive down demands for pay rises in the West and hammer in the message of more “flexibility”. The benefits of the increased “competition” go of course to the management and the CEOs, who - at least in the US - earn now as much money in a day as the average worker in a year, Source: UFE Report 2007)
Defenders of market liberalism of course argue that all problems arose only because of the incomplete application of its principles, because of endless interventions and protectionism it could never deliver the goods. There is some logic in this argument but the truth is, that countermovements were not the result of some left-wing conspiracies but of the massive injustice this concept (market liberalism favours the worst kind of capitalism) has produced.
The amazing thing is that the US seems to be the only country where no resistance was generated since the public were made to believe that if they do not succed in this system it is their own fault. (Did 9/11 help to divert attention from the misallocation of public funds? - “Support our troops” sounds much better than “support the security and defense industry”….)
The thesis of the “shock doctrine” is right in principle but in my view was only one of serveral motives for the invasion of Iraq. It shows the utter contempt these guys have for democracy and freedom (as the right to self-determination) They take away our dignity as human beings by turning us all into commodities and laugh at us for still longing for some sort of justice…
I think that this kind of amorality has created 9/11, not Islamic extremists. (The are the effect not the cause) What is left of our “Western values”? How can we lecture Muslims to renounce violence when it is inherent to our economic system?
Look no further than the Project for a New American Century Report(PNAC):
REBUILDING AMERICA’S DEFENSES
Strategy, Forces and Resources
For a New Century
A Report
page 51
“Further, the process of transformation,
even if it brings revolutionary change, is
likely to be a long one, absent some
catastrophic and catalyzing event – like a
new Pearl Harbor.” READ 9/11
If you think this is a coincidence - read this from page 2 - about PNAC
“As the 20th century draws to a close, the United States stands as the
world’s most preeminent power. Having led the West to victory in
the Cold War, America faces an opportunity and a challenge: Does
the United States have the vision to build upon the achievement of
past decades? Does the United States have the resolve to shape a
new century favorable to American principles and interests?
“[What we require is] a military that is strong and ready to meet
both present and future challenges; a foreign policy that boldly and
purposefully promotes American principles abroad; and national
leadership that accepts the United States’ global responsibilities.
“Of course, the United States must be prudent in how it exercises its
power. But we cannot safely avoid the responsibilities of global
leadership of the costs that are associated with its exercise. America
has a vital role in maintaining peace and security in Europe, Asia,
and the Middle East. If we shirk our responsibilities, we invite
challenges to our fundamental interests. The history of the 20th
century should have taught us that it is important to shape
circumstances before crises emerge, and to meet threats before they
become dire. The history of the past century should have taught us
to embrace the cause of American leadership.”
– From the Project’s founding Statement of Principle”
“
Paul Bramscher, actually, you contradicted yourself. First you said ““Free market” is an oxymoron. Free-anything is a philosophical/logical non-sequitur or violation of a basic law of a physics”. Then you said “It would be free only if the powerless were free to employ the same sort of coercive techniques the powerful use.” Either a free market can exist or it can’t.
Secondly, if the rest of us were free to use coercion and indeed did you use it, then it would not be anarchism and the reverse would exist, leaving us in a situation devoid of freedom.
Thirdly, free market is not even an oxymoron and it can exist. It works with a minimalist government and it would work in an anarchism. Just leave the coercion out of it and all of it will work.
Hi all. I‛m going to agree with most folks here. We can probably all disagree with each other on some details.
I was so bugged by Naomi Klein‛s support for John Kerry in the last US general election that I stopped reading her. But I knew it would be temporary. And I felt the same about other progressives, like Noam Chomsky, who also urged citizens to vote for Kerry. But if I stopped reading those people, I‛d be lost. (I barely have a grade 10 education.) Well, I‛m over my anger about progressives‛ behavior in that election (haven‛t changed my views) and I‛m looking forward to reading Shock Doctrine.
I‛ve got too many books to catch up on, however. Those are books I‛ve bought! Like today. I received an email from John Christensen (http://www.taxjustice.net/cms/front_content.php?idcat=2) in response to a request for info on his latest book, which I knew about but could not find. I caught him on CBC radio, not long ago, being interviewed by Carol Off. She mentioned that John was writing a book (Well, The book he put me onto is written by numerous authors, including himself.). A signature I often used (for years) in online forums goes something like: “5 Trillion $ (globally sourced) sit, protected by George W. Bush, in offshore TAX HAVENS, while political ‛leaders‛ whine that they can‛t afford social spending!” The discussion John was having with Carol had my attention, since it‛s a subject that interests me greatly and has done so for many years, ever since reading articles about tax havens by Mark Schapiro (The Nation), Ken Silverstein (Mother Jones) and Lucy Komisar (http://www.thekomisarscoop.com/ ). Lucy Komisar has a section in John‛s new co-authored book. And I was delighted to hear John tell Carol that there is something like 11.5 trillion dollars now in offshore tax havens. It meant I could correct all of those outdated sigs out there!
Tonight I picked up the book John informed me about. It‛s titled A GAME AS OLD AS EMPIRE - THE SECRET WORLD OF ECONOMIC HIT MEN AND THE WEB OF GLOBAL CORRUPTION (pub 2007), edited by Steven Hiatt, who also has a section in the book. I went across the street here in Toronto‛s Greek Village to sit in a Second Cup and enjoy checking out my new book, when I quickly came across a line urging the reader that if he or she has picked up the book without prior knowledge of it, then they might want to first read John Perkins‛s CONFESSIONS OF AN ECONOMIC HIT MAN (pub 2004), since A GAME was intended as a companion to it. Well, I hadn‛t got too far, geographically and with A GAME, so I went back to the store and picked up CONFESSIONS, as instructed. More books.
Check it out >
“My publisher asked whether we actually referred to ourselves as economic hitmen. I assured him that we did, although usually only by the initials. In fact, on the day in 1971 when I began working with my teacher Claudine, she informed me, “My assignment is to mold you into an economic hit man. No one can know about your involvment - not even your wife.” Then she turned serious. “Once you‛re in, you‛re in for life.”
“…Claudine pulled no punches when describing what I would be called upon to do. My job, she said, was “to encourage world leaders to become part of a vast network that promotes U.S. commercial interests. In the end, those leaders become ensnared in a web of debt that ensures their loyalty. We can draw on them whenever we desire - to satisfy our political, economic, or military needs. In turn, they bolster their political positions by bringing industrial parks, power plants, and airports to their people. The owners of U.S. engineering/ construction companies become fabulously wealthy.”
“Today we see the results of this system run amok. Executives at our most respected companies hire people at near-slave wages to toil under inhuman conditions in Asian sweatshops. Oil companies wantonly pump toxins into rain forest rivers, consciously killing people, animals, and plants, and committing genocide among ancient cultures. The pharmaceutical industry denies lifesaving medicines to millions of HIV-infected Africans. Twelve million families in our own United States worry about their next meal. The energy industry creates an Enron. The accounting industry creates an Andersen. The income ratio of the one-fifth of the worldl‛s population in the wealthiest countries to the one-fifth in the poorest went from 30 to 1 in 1960 to 74 to 1 in 1995. The United States spends over $87 billion conducting a war in Iraq while the United Nations estimates that for less than half that amount we could provide clean water, adequate diets, sanitation services, and basic education to every person on the planet.” -preface to CONFESSIONS OF AN ECONOMIC HIT MAN, by John Perkins.
William Greider (with The Nation magazine), author of ONE WORLD, READY OR NOT - THE MANIC LOGIC OF GLOBAL CAPITALISM (pub 1997), looks at everything and very plainly tells us what he sees. He talks about how corporations engage in bidding wars for employment (Alabama gets the car factory because, after the tax breaks and subsidies it offers, it becomes the least costly jurisdiction for Daimler-Chrysler to set up a new factory, paying, in effect, $200,000.00 for each job for only 1500 workers), how they game tax codes of various countries and how governments - in the kind of capitalist system we have - play market access games (governments acting, out of confusion sometimes, for corporations based in their countries), bargaining with other governments, offering jobs and technology and expertise in return for tax breaks and a foothold in their markets. And he basically shows how governments have been manouvered into a position of weakness in the face of incredibly powerful finance capital and now simply take orders from capitalists who want more and more freedom (to plunder) and expect political leaders to sell for them.
Greider ties all of this into tax havens on page 33 (and elsewhere), where he refers to tax havens as being part of a “larger and exceedingly complicated political agenda - the politics of escape.” Every free trade deal is about one thing and one thing only, namely giving corporations more freedom and power, allowing them to escape responsibility for a carefree existence. Corporations, according to their captains, can never get enough liberty. That includes freedom from governments (and by extension, those of us who voted for them) and their regulatory agencies, including those dealing with taxation. (Right now, in Ontario, the Progressive Conservative Party is being investigated by Elections Canada for shuffling money from it‛s local level to it‛s federal level where the spending caps are different - in accordance with the real rules of capitalism. See http://www.thestar.com/article/255145 ).
Linda McQuaig, whose book ALL YOU CAN EAT (pub 2001), incidentally, takes it‛s theme from Karl Polanyi‛s THE GREAT TRANSFORMATION, wrote THE QUICK AND THE DEAD, a review of the origins of the Free Trade Agreement between Canada and the U.S. and (along with many others elsewhere) reveals that the agreement had nothing to do with free trade (estimated, as Chomsky and Greider note, to be at about 14%), but everything to do with services, investment and intellectual property rights. The deal would, as it has, lead to rules that would in fact be the opposite of what you‛d expect in a free market. For example, Drug companies would not have a shred of competition and could rob us blind. Consumers matter, sort of. But not the way they would like to matter if they are paying attention.
As Justin Akers Chacón noted in the July/ Aug 2007 issue of International Socialist Review, in his article titled “Casualties of Neoliberalism,” that “Nowhere in the 700-plus pages of NAFTA text was there a plan to address the land loss, deindustrialization, and impoverishment that would immediately result in those sectors of the economy made vulnerable by exposure to the world market.” And it‛s the same with every trade pact. It‛s not about people. As Murray Dobbin noted in pages 118 & 119 of THE MYTH OF THE GOOD CORPORATE CITIZEN (pub 1998): “Common to all of these deals and potential deals is the complete absence of any reference to social, environmental, or labour standards or any human rights.” Recounting the unsuccessful effort of capitalists in and out of government to foist the Multilateral Agreement on Investment on us, Dobbin passes this gem to us. He relays one instance when a very powerful U.S. business lobby group, The U.S. Council for International Business, speaking for U.S. transnational corporations, “wrote to senior U.S. officials in 1997. “The MAI is an agreement by governments to protect international investors and their investments and to liberalize investment regimes. We will oppose any and all measures to create or even imply binding obligations for governments or business related to environment or labor.”
Clearly. As John Perkins noted in the Preface to CONFESSIONS, The way the (criminal) compulsion system works is through a 3 step process that goes from Economic Hit Man to CIA-sanctioned jackals (assassins) if the EHM fails, and lastly, to the armed forces if those first two processes fail. So the above lobby group spokesperson knows what he‛s talking about. Workers and consumers here in North America may not, seemingly, equal Iraqi insurgents who are causing ‛instability‛ in Iraq, but, as Noam Chomsky points out (in pages 18 & 19 of CHOMSKY ON ANARCHISM, selected and edited by Barry Pateman/ pub 2005), we in fact are the domestic counterpart to those insurgents. When we are anything but passive, we represent ‛instability‛ in the minds of our leaders and their partners (and bosses) in business. ‛Freedom‛ or ‛liberty‛ or ‛liberalization‛ is for capitalists and their projects. And that is what Greider is referring to when he talks about the politics of escape.
“…Multinational corporations, faced with continuing surpluses, desperately need entry into the burgeoning markets. National governments, meanwhile, aim to secure a foothold in the advanced-technology sectors - aircraft, electronics, automobiles, telecommunications and others - that provide the core of modern, high-wage economies. These motivations converge in a familiar, blunt demand from the customers: if we buy your airplanes (or cars or telephone systems), you have to give us a share of the production, jobs and also industrial expertise.
“This bargaining is always done discreetly and seldom discussed very openly by either governments or multinational corporations because it directly violates the reigning spirit of free trade. The deals regularly flout or circumvent the numerous global trade agreements negotiated among nations, ostensibly to prohibit such political interferences with the free marketplace.” -pg 122 of ONE WORLD, READY OR NOT by William Greider
I think that there‛s plenty of evidence that capitalists‛ shock therapy, a la the Chicago School theory based on sick CIA practices, isn‛t equal to bad tasting medicine that leads to good health. Capitalism is responsible for the changing of the environment and the global warming that is cooking our planetary home. Which means that, ultimately, without intervention from a higher source, ‛all‛ of us are screwed, not healthy.
I loved NO LOGO (but hated the title). My favorite parts in NO LOGO have to do with Export Processing Zones, a great example of corporate escapism. Countries like China (loved by our capitalist class) carve out areas where companies can come in and set up for some negotiated period of time and enjoy a tax holiday and labor costs that are almost non existent. EPZs, conceived by the UN in 1964 and tried first in India in the early 1980s, were supposed to go away, but they didn‛t. They just close and re-open under different names, a practice that host countries‛ officials allow - for a price. Peter Dale Scott, in his book titled DEEP POLITICS - THE DEATH OF JFK (pub1993), said it all when he referred to the fact that the world is not divided up into neat categories of overworld and underworld. It‛s all one, big, criminal ball of wax.
WmC noted that Greg Palast refers to ‛corporatopia‛ to describe the present very favorable conditions for capitalists. It‛s hard to argue with that. Interestingly, In Perkins‛s CONFESSIONS, Greg Palast plugs the book on the front cover. And coincidentally (?), I find a reference within the first few pages of CONFESSIONS to “corporatocracy.”
Minitru mentioned THE GREAT TRANSORMATION. I have a copy of Karl Polanyi‛s seminal THE GREAT TRANSFORMATION (pub 1919). It‛s not an easy read, which is why I haven‛t read it. But I might try again. It‛s just so stuffy. But I did like the idea that Polanyi promoted that we need a socialism from the ground up, in which the central tenet isn‛t centralization, but freedom. Often I‛m asked, “If not capitalism, then what?” I usually answer that this is not China and just because I don‛t have an answer to capitalism, that doesn‛t mean I can‛t be against it and express that opposition. I then add that, ‛In the short term I‛d probably prefer the kind of socialism envisioned by Karl Polanyi‛. The ‛long term‛ becomes a religious discussion.
Polanyi‛s socialism has never been tried on a large scale and it appeals to my values. Those are not, I should mention, democratic values. I don‛t believe in democracy. I‛m a theocrat.
Arby
And after how long a spell would that short term be able to commence? Not all that short I’d wager. Theocracy would be nice…in a nexus comprised of additional dimensions…heaven? Between that and this place there seems to be a gap of indeterminate time in addition to other barriers. So everything must be interpolated, though of course in the beginning there were those precedents western humans tried to graft in like: innocent until proven guilty.
Arby, though I still haven’t finished it (found it 2 wks ago)…that was the most interesting letter I’ve come across here yet. Had to say something, esp since no one else has. You must not have let Toronto get you down, like I remember the determined way Cockburn tried not to let it get him down…in that song. Got an old calendar with Provencial Park photos, and I hope to make it someday.
Much appreciated from down here.