Privatisation - Financial Fundamentalism without Analysis of Real Costs
Last year's cessation of hostilities between the Sri Lankan government and the Tamil Tigers, after up to 40,000 Tamil civilians were murdered in the last months of the conflict, has heralded a Beijing-led invasion of the island.
The authoritarian Rajapaksa regime was assisted by Chinese weapons and intelligence in its defeat of the Tigers and now China is investing to reap the rewards. Kidnappings and extrajudicial killings in Sri Lanka are irrelevant in the pursuit of regional dominance.
Billions of dollars are being spent to build ports, infrastructure and roads in a country trying to recover from three decades of war, despite reconciliation largely absent from public debate. Referring to China, the Sri Lankan Defence Secretary, Gotabaya Rajapaksa, has said: "We have understood who is important to us."
The economy is in such poor shape that its leaders are seemingly happy to auction assets, land and influence to friendly countries and corporations.
After the 2004 tsunami, Western multinationals flooded the country to capitalise on Colombo's willingness to sell off its forests, water and beaches to the highest bidder. "A second tsunami of corporate globalisation," said Herman Kumara, the head of Sri Lanka's National Fisheries Solidarity Movement.
China has filled this role, extending the hand of unlimited finances, military hardware and diplomatic cover.
The concept of disaster capitalism, articulated in Naomi Klein's best-seller The Shock Doctrine, revolves around "orchestrated raids on the public sphere in the wake of catastrophic events", real or man-made, "combined with the treatment of disasters as exciting market opportunities". But the definition of "disaster" is deliberately vague, allowing anything from post-conflict zones to water scarcity to be defined as needing corporate intervention. Profit is the motive and human rights an inconvenience. An ironfisted leadership is helpful but not essential to maximise financial return.
Think Iraq since 2003 and the price-gouging by the company Halliburton in Haiti after the earthquake; latest reports claim the removal of countless refugees from desolate camps to make way for "industrial work zones".
In Australia, the British firm Serco runs expanding detention centres, despite allegations of asylum-seeker abuse in its facilities. Even the ownership by French firm Veolia of some of Australia's waste management, water treatment and desalination plants ignores the company's building of a light-rail network through occupied Jerusalem and illegal settlements in the Palestinian West Bank.
The belief in privatisation and deregulation is shared by the major parties in most Western democracies. We constantly hear the language of "efficiency", "better services" and "cost-savings".
Overseas examples don't offer much comfort. An April report released by the Australian Services Union revealed that, "the French private water companies [Veolia and Suez] have a large chunk of state ownership and they privatise other public water services while their own state ownership protects them from foreign takeovers in France".
Downsizing the public sector is framed as the inevitable price of progress. We have seen privatisation by stealth, the purchase and management of key resources and infrastructure by local and foreign corporations with little accountability or discussion. Neo-liberal theories have become doctrine.
Sydney Chamber of Commerce said in 2008 that "there's a raft of state government assets ... that, arguably, have no reason to be in government hands". The group argued that in a "weaker economic environment" there must be "efficiencies" found.
In these cases, the "disaster" is the gradual lack of public funds for infrastructure and willingness of corporations to step in. But there is no public debate over this and the public backlash over electricity and ferry privatisation indicates fierce resistance.
The recent financial collapse of public-private partnerships, especially road and tunnel projects, is a warning sign that business as usual is not delivering the best services to society.
An economist, Steve Keen, argues that the largely bipartisan political and media backing of privatisation is reminiscent of religious fundamentalism, with no analysis of the costs.
Take military outsourcing. ABC Online recently reported that the Australian government had hired Chilean mercenaries to guard its Baghdad embassy despite serious concerns over the conditions and behaviour of the hired men. The foreign affairs department defended the move but it simply justified the continued use of private militias hired by Western governments in places such as Afghanistan and Iraq.
I have spoken to security sources that confirm the defence force's willingness to outsource key tasks in current and future deployments.
There is no discussion in Australia about the massive expansion of mercenaries since September 11, 2001, including by Australians, and the lack of transparency of outsourcing vital services to the private sector. The Washington Post reported recently there were nearly a million contractors in America working in intelligence and counterterrorism.
The reporting group ProPublica says this year was the first time that more contractors than soldiers were killed in Iraq and Afghanistan, as governments rely increasingly on faceless corporations to fight their battles. The Nation's Jeremy Scahill revealed allegations that Blackwater agents in Iraq fired indiscriminately into Iraqi homes while they were high on cocaine and steroids. Welcome to a rebranded, privately run occupation.
The unquestioning devotion to disaster capitalism and privatisation revolves around a belief in the market's wonders. But what if a heart and soul is missing in the negotiation room?
© 2010 Sydney Morning Herald