The Shock Doctrine: The Rise of Disaster Capitalism

NOTE: this review only covers Part 1 - Part 5 In The Shock Doctrine, Naomi Klein surveys the rise of and subsequent use of the "shock doctrine" as a method of instilling neoliberal policies into the governments of various countries from Chile to Russia. She traces the birth of this doctrine, its relation to shock therapy, and the way countless economics, dictators, and other officials have attempted to craft a new world order that never went according to plan. With a definite bias, Naomi Klein makes no apologies for her views, yet as radical as some might interpret her to be, she presents a compelling view of this political and economic philosophy that certainly resonates with current events, particularly the earthquake that devastated Haiti earlier this year. If there is one figure at the heart of Klein's narrative of neoliberal ideas it is Milton Friedman, the figurehead of neoliberalism, a man who counseled various foreign leaders in their attempt to implement the shock doctrine. The primary aim of the shock doctrine is to "shock" the economy of the country by drastically changing key policies that align with the neoliberal agenda. Most often, these times of drastic imbalance follow an uprising, coup, war, or the like. In this state, the citizens are already feeling a sense of distress and therefore, any additional shocks to the economy should not be a major issue. So, what Klein is attempting to do is to show that capitalism is not born of freedom and that "unfettered free markets go hand in hand with democracy" (pg. 22), but instead to challenge that "official story of capitalism" by demonstrating that capitalism, "has consistently been midwife by the most brutal forms of coercion, inflicted on the collective body politic as well as on the countless individual bodies" (pg. 23). Whether or not one subscribes to the beliefs of Naomi Klein, she does propose a very convincing look at the ways economics and political intertwine on a global scale. Beginning with the links between shock therapy and the shock doctrine, Klein basically suggests they work the same, both are aimed at erasing a "memory" if you will, to create a clean slate. In shock therapy, a new set of behaviors may be imprinted, in the shock doctrine, a new set of economic policies is to be enacted, specifically neoliberal policies - free trade, deregulation, privatization, etc. The chapter on this relationship between the two actually works to shock the reader, to show how unscrupulous these doctors were in trying to treat their patients, and these same doctors were coincidentally enough government funded for the most part. Without going into too much detail, subsequent chapter discussed the way the shock doctrine was executed (or attempted) in countries around the world; Klein uses Chile, Poland, South Africa, Russia, and China as prime examples. Each case follows a similar trajectory with a leader or faction in power that a certain cabal of insiders who wanted to shock the countries political and economic systems until they were replaced with neoliberal ideas, policies, and practices. In Chile, probably the best example from the book, a group of Chilean students taught at the University of Chicago (home to a neoliberal contingent of economists) formed a group called "The Chicago Boys," and these men infiltrated government positions and advised the military leaders who were planning a coup to force the president out of power. This scenario was repeated in several different incarnations around the world; Klein shows how governments from Communist to Democratic were all injected with a neoliberal agenda and how shocks in all the examined countries facilitated the changes that were to be necessarily to support a change. All cases, although very similar, are not always the same as the case of Russia and China illustrate. As these countries seemed to be transforming into democratic countries, underlying this adjustment was the shock doctrine, which was exercised differently than it was in the cases of the Latin American countries. Interestingly, as was the case in South Africa, and an example that stands out slightly, although Nelson Mandela and the ANC (African National Congress) came into power, their control over South Africa was more than show than an actuality. The men - white Afrikaners that had been in power for decades - continued to control the country's politics and economics behind the scene. But in all of these examples, the main point is that government coups, backhanding dealings, and other shady transactions were carried out to impose a new rule of law - that being neoliberalism. Part Five and one of the most interesting and compelling sections deals with the shock doctrine in the United States. Here, Klein weaves together the conjunctures between all the Bush era players, Bush Jr., Cheney, Rumsfeld, etc. and shows how each of these men had all the money in the world to gain from privatization efforts pre and post 9/11. The figures that Klein quotes Rumsfeld and Cheney making in their business ventures are mind boggling, and only reinforce the Bush administration's need to want to impose their own form of shock doctrine. What is most frightening about these figures is the example of Rumsfeld who was Chairman of Gilead Sciences, the company that patented Tamiflu. In other words, in any disaster where large quantities of Tamiflu were needed, and while people were suffering, Rumsfeld and the company would being doing financially well. Although this whole section was a little too "conspiracy theory" for my personal liking, Klein does you make one think more about the implications of those government officials being tied so closely to large for profit corporations. Overall, The Shock Doctrine is well researched, clear, well written and most of all a very, very compelling read. If you agree with Klein's views, you will love this book, if you are more of the neoliberal and conservative variety, you will probably not enjoying reading it and will certainly disagree with Naomi Klein and what she has to say. Overall, I think no matter one's political or ideological leanings, The Shock Doctrine makes the point of how tied together we are in a globalized world. Globalization does not just affect politics, economics, culture, or society. It doesn't just affect material goods, but it influences the way we all live our lives in the twenty-first century. As many reviewers have stated already, this book is eye opening, yet it offers the hope that maybe if we all become a little more educated about what is going on in the world, we could do something more to change it to the way we see fit.

I've read dozens (hundreds?) of books about what went wrong during the Bush administration (as well as books about what's continued to go wrong under Obama too). Some books are about specific things such as the Iraq war or GITMO. Others look at more overarching themes such as executive power or disregard for the rule of law. Most of such books have made some important points and contributed some valuable analysis, but I've usually been left feeling like the blind men arguing over what they've discovered. "It's a rope," says one. "No, it's a wall," says another. "You're both wrong, claims the third, "it's a tree trunk." Naomi Klein's "The Shock Doctrine" is the first book that correctly identifies the elephant. Now, perhaps Ms. Klein doesn't have the elephant quite right - maybe her elephant's ears are a tad too large, or perhaps its tail is a bit too short, but overall, she has described the elephant remarkably well. Following an introduction, Klein opens with the story of Dr. Ewen Cameron, a psychiatrist who believed that in order to "heal" his patients, he first needed to destroy their dysfunctional personality structure and "regress" them back to infancy in order to create a "clean slate" upon which to build a new, healthy personality. To accomplish this, he used a barrage of "treatments" from psychoactive drugs to extreme doses of electroshock therapy to sensory deprivation for weeks or even months at a time. The only problem, of course, is that he never successfully re-created fresh, healthy people - all he did was traumatize people and leave their old selves virtually destroyed. Now, it may seem a bit of a leap from one obscure Canadian psychiatrist to the global wave of "shock and awe" which has escalated especially in the last decade, but Ms. Klein has followed the trail carefully and plausibly. One of the first and most important stops along this trail is the economist Milton Friedman, the godfather of the "Chicago School" system of supply-sided free market capitalism. Friedman and his followers believe that if only there were purely unregulated, completely free markets, all or nearly all world problems would correct themselves through market "signals". Friedmanites believe that most if not all problems result from government regulations which distort the markets and confuse the signals. Their problem, especially during the height of New Deal Keynesian economics, was that no purely free market existed anywhere. In language eerily reminiscent of Ewen Cameron, Friedman wished to create a "clean slate" upon which "healthy" capitalism could be built. The next problem, however, was the pure capitalism was (and remains) deeply unpopular and, hence, difficult to implement in a democratic state. It turns out, fancy that, that given the choice, people *want* their government to protect them from rapacious corporate interests. The "Southern Cone" region of South America exemplified this problem. Having recently broken away from European colonial powers, nations like Chile and Argentina began building "developmentalist" economies - basically capitalistic economies protected by government regulations. Furthermore, these developmentalist economies were by and large successful. And wildly popular. The Friedmanites initially tried to overcome developmentalism (note, despite the rhetoric, the concern was never about communism) by sending hundreds of Chile's brightest students to study economics at the University of Chicago. These "Chicago Boys" were to return home and implement their newfound knowledge. But they weren't taken very seriously back home, since developmentalism was still in full-swing. Their chance came with the brutal and bloody overthrow of the democratically elected Salvador Allende by the U.S. backed Augusto Pinochet. In correspondence with Pinochet, Friedman urged Pinochet to use the window of opportunity created by the shock of the violent overthrow to implement "shock therapy". While the country was still reeling, and while dissidents were being actively and publicly silenced, Pinochet opened up nationalized companies to foreign private investors at fire sale prices. He repealed trade restrictions which resulted in a flood of cheap foreign goods which put many local companies out of business. In the name of "austerity" and reducing debt, he cut back on social programs for the poor and very young and old. Most Chileans were too busy trying to survive and put their lives back together to protest. Those who did tended to mysteriously disappear or simply get executed on the spot. Of course, even with the markets thrown wide open, the markets did not correct the ills of the country. In fact, things got significantly worse until some of the worst of the abuses were halted and some basic regulations restored. Meanwhile, over half of Chile's population descended into poverty and destitution. In country after country, Klein details how the same basic patterns repeated over and over again, with variations to account for the learning curve of the Chicago Bys and the different initial circumstances of each country. Indonesia, Argentina, Uruguay, Poland, Russia, South Africa, China and Iraq all experienced variations of "disaster capitalism" following (or during) wars, coups or revolutions, often in direct opposition to what the revolutionaries were fighting for. Time after time, nationalized industries were ripped from the people and pillaged by foreigners while governments cut back on aid to their own people. Time after time free market capitalism was implemented by brute force and shock therapy because it could not be implemented by democratic vote. Even the "developed" nations were not immune to the assault by the Chicago Boys. Both Margaret Thatcher in Britain and Ronald Reagan in the U.S. were ardent admirers of Milton Friedman, but both knew that they couldn't get away with what Pinochet and Suharto had. But both found their openings to begin making lasting changes - Thatcher used the Falkland's war while Reagan used the air traffic controllers strike, among others. Klein also shows how disaster capitalism gets implemented after natural disasters. Fishing families swept from their villages by the 2004 tsunami returned to find their beaches closed to them but wide open for luxury hotels and tourist resorts. Refugees from 2006 Hurricane Katrina returned to find no effort to rebuild their public schools, but charter schools already infested the city. Klein's book is a searing indictment of Milton Friedman and his followers, their morally bankrupt economic philosophy and the wide spread pain and suffering they have caused. This book is a must-read for anyone who wonders how we got where we are now. How it is that in the richest nation on earth, upwards of 10% of the population is unemployed, more than one in four children is food insecure and 49 million American don't have basic health coverage, while the top 1% own fleets of cars and boats and even entire islands. My only disappointment with the book is that it was published in 2007 - just before the Great Recession. I hope that Klein comes out with a follow up soon. In her final chapter, "Shock wears off", Klein talks about a number of hopeful signs, many coming from the first countries to be shocked and awed. It is her belief that as shock wears off, people become shock resistant and once more able to fight back. Perhaps that's what we're seeing with the Occupy movement. This far-reaching, wide-ranging and hard-hitting tour de force is also extensively documented in 100+ pages of end notes plus several asterisked footnotes. This book should be required reading for every high school and college economics class, if not for every American. I can't recommend it highly enough. Amazon only allows five stars, but I give it ten.

Wondering how government services always get worse? This book details how large corporations use natural disasters to screw both governments and citizens for profit.

Wer sich in den letzten Jahrzehnten immer wieder über das Auftreten der Weltbank oder des IMF aufregen konnte, wenn irgendwo auf der Welt eine Katastrophe eingetreten war und die Agenten dieser Institutionen zwar einerseits mit viel Geld, aber andererseits mit einem absurden Forderungskatalog um die Ecke kamen, der wird sich gleich nicht mehr wundern, warum dieses so war und so ist. Es zieht sich wie ein roter Faden durch die aktuellen Krisen der Menschheit, egal ob es Erdbeben oder Tsunamis, politische Umstürze, Kriege oder Wirtschaftskrisen sind. Der organisierte Weltkapitalismus geht stets mit einem Besteck der Re-Organisation vor, das im eigenen Hause entwickelt wurde und seither Anwendung findet. Die kanadische Journalistin Naomi Klein - ihre Eltern verließen aus Protest gegen den Vietnam-Krieg die USA - hat das System des Wiederaufbaus nach Katastrophen untersucht. In ihrem lesenswerten Buch The Shock Doctrine hat sie den Guru der radikalen Marktwirtschaft sehr schnell lokalisiert. Es war der Chef der Chicago School of Economics Milton Friedman, der mit seinen radikalen markttheoretischen Schriften zunächst in den USA kaum jemanden begeistern konnte, der aber in Jahrzehnten kontinuierlichem Lobbyismus das Feld bereitete für den Siegeszug des totalitären Kapitalismus. Mit beeindruckender Stringenz seziert Naomi Klein das System: Zunächst tritt die Katastrophe ein. Die Bevölkerung ist traumatisiert und damit das Terrain für die Invention des neuen Systems bereitet. Das so genannte weiße Blatt liegt jungfräulich auf dem Tisch und alle Institutionen, die der betreffenden Gesellschaft einmal das Dasein erleichtert haben, sind ausradiert worden, um Raum zu schaffen für den ungezügelten Kapitalismus. Denn das ist die Doktrin Milton Friedmans und seiner Chicago Boys. Der Spähtrupp der Schock-Doktrinäre sind tatsächlich immer wieder IMF und Weltbank, die sofort nach dem Desaster auf der Matte stehen und folgenden Deal ausmachen wollen: 1. Das betreffende Land belässt es beim Wiederaufbau aller öffentlichen Institutionen, die der Staat betrieben hat, um den Markt zu beschränken. Damit gemeint sind auch Schulen, Krankenhäuser und Sicherheitsorgane. Diese Dienste werden privatisiert. Alle Regulierungen des freien Marktes werden revidiert. 2. Der Staat betreibt eine strikte Politik des Schuldenabbaus, damit er keine Perspektive mehr hat, sich einzumischen. 3. Sind diese Bedingungen erfüllt, ertränken IMF und Weltbang das Land mit Krediten, um eine dauerhafte Schuldknechtschaft zu gewährleisten und die Bedingungen der Radikalliberalisierung dauerhaft zu erhalten. In beeindruckender historischer Analyse dokumentiert die Autorin das nach und nach zutage tretende System. Egal, welche historischen Desaster zur Grundlage genommen werden, sie haben immer die gleichen Implikationen, ob beim Pinochet-Putsch in Chile, ob die Nutzung des Falkland-Krieges durch Thatcher im eigenen Land, ob bei den vielen Kriegen im Nahen Osten, speziell im Irak, ob nach den Tsunamis in Asien und ja, auch nach dem Massaker auf dem Tienanmen in Peking oder der Niederschlagung der Revolte in Moskau. Das Vorgehen zum Wiederaufbau, der keiner ist, stammt aus dem Regiebuch Milton Friedmans. Interessant ist, dass die USA innenpolitisch langfristig von dieser Doktrin verschont geblieben waren, wenn man einmal von den Verwüstungen absieht, die die Reagan-Ära in kurzer Zeit angerichtet hatte. Doch mit den Anschlägen auf das World Trade Center war auch dort der Schock eingetreten, den George W. Bush exzellent und konsequent unter dem Slogan der Homeland Security zu nutzen wusste. Ein Debakel, an dem das Land, wie alle, die einmal unter dieser Behandlung leiden mussten, noch lange laborieren wird. Naomi Kleins Bilanz ist gigantisch: Betrachtet man den Ansatz konsequent, so stehen die Verwüstungen, die Verfechter eines totalitären Kapitalismus bereits angerichtet haben, den großen Monstern der Geschichte in nichts nach.

This extraordinarily entertaining and thought-provoking left-leaning book is full of detail in describing the battleground between Keynesian and (gaining) Friedman economic theories since the 1970s. The latter believes that the capitalist engine drives economies whereas the socialist safety net costs them. It has exploited opportunities presented by natural or man-made disasters (for example, 9/11, counterrevolutions and military coups, debt, hyperinflation, Katrina and New Orleans, the 1993 invasion of Iraq and its aftermath, the collapse of the Soviet Union, the US air traffic controllers’ strike, tsunamis, etc. - and perhaps even a few deliberately created crises) in order apply shock and awe to get things done its way. The solution has been to apply accelerated elitist non-democratic driven shock therapy of laissez-faire economics, unfettered free markets, dramatic reductions in government expenditure and creation of hollow governments, high levels of subcontracting of responsibilities to large corporations, and the selling off of state assets at giveaway prices. In such cases, government decision making and strategy has become increasingly influenced by the profit motive of vested interests (most notably the rapidly growing defence and security industries). The result has been dramatic plutonomy, a widening of the gap between rich and poor and the creation of a massive underclass, all while stock markets have continued to rise, as well as such phenomena as gentrification and gated communities for the privileged. Countries have moved away from mixed, socially levelling economies towards trickle-down economics, corporate dominance and the pressures of globalisation on employment and wages. Such solutions can be contrasted with the post WW2 Marshall Plan which restrained rampant capitalism in taking into consideration social movements and restricting the ability of foreign corporations to pillage susceptible economies in order to get ‘a piece of the action’. The author points out many cases of what can be interpreted as criminal behaviour, either through negligence or incompetence, conflicts of interest, the evasion of public scrutiny, allowing corporate interests over-influencing government strategy (notably in relation to military conflicts), not to mention the abundance use of revolving doors between government posts and private industry. The bad names and words in this trend include the ‘neoliberal’ Chicago School of Economics, (where Milton Friedman and many acolyte protagonists originated from), and individuals such as Bremer, Bush, Cheney, Pinochet, Reagan, Rumsfeld, Sachs, and Thatcher. This book was published in 2007, i.e. before the financial crisis, Snowden, Syria, the Arab Spring, the Greek crisis, the growth of ISIS, and the restraint practiced by Barack Obama, so it pays to gloss over the last chapter, as well as any promise that might have been then seemingly offered by characters such as Chavez, Kirchner, and Putin. Parkinson’s Law illustrates the dangers of big government, ivory towers and the absence of competition, and too much democracy can result in sclerosis, so presumably there does exist a just middle way, but certainly not the one described in this book.

大惨事につけ込んで実施される過激な市場原理主義改革（Shock Doctrine）、「惨事便乗型資本主義（Disaster Capitalism）」として分析解説されています。 Believers in the shock doctrine are convinced that only a great rupture ' a flood, a war, terrorist attack ' can generate the kind of vast, clean canvases they crave. It is in these malleable moments, when we are psychologically unmoored and physically unrooted, that these artists of the real plunge in their hands and begin their work of remarking the world. フリードンの唱える市場至上主義の信奉者達は、洪水、戦争、テロ攻撃等の破壊状況のみが、希望する白紙のキャンバスを拵えてくれると確信している。 被災者達が心理的に自分を見失い、肉体的にも根なし草状態になっている時こそ絶好の機会と捉えて、彼らの望む世界を構築すべく活動策謀を始めるのだ。 国際公約でのTPP参画で、東日本大震災の復旧、原発安全廃炉・放射線の処理工事に、住民要望を無視したこの惨事便乗型資本主義が適用されてしまう懸念が拭いきれません。

A truly extraordinary book. Paints a very frightening and disturbing but realistic picture of the current world order - well supported by excellent research and irrefutable facts. A MUST Read for everyone interested to know what is happening in the current world (economic-political-social), how we got there and which way we are headed - from Iraq to the US, from Russia to China and from Asia to LATAM.