KEY POINTS:
THE SHOCK DOCTRINE: THE RISE OF DISASTER CAPITALISM
Author: Naomi Klein
Publisher: Penguin
Reviewer: Will Hutton
Naomi Klein is confused. She has written a tough attack on capitalism's capacity to insist that public policy be run wholly in its own interests and its conspiratorial capacity to capitalise on all forms of disaster and social distress to get its way. Fine.
"Disaster capitalism" is an insightful way of looking at how the free marketers have spread the gospel. Sometimes you cheer her on, but nowhere does she concede that markets can have good results as well as bad. Nowhere does she explore what those circumstances may be and why economic freedom is so appealing to so many. And nowhere does she set out an alternative manifesto for running economies and societies.
In her delusional, Manichaean world view, privatisation, free markets, private property, consumer freedom, the profit motive and economic freedom are just other terms for corporate self-enrichment, denial of voice, limitation of citizenship, inequality and, sometimes, even torture. The discredited electro-shock psychological treatment of the '50s, we learn, informed the thought system of the free marketers; it is guilt by association and assertion rather than proof, a weaknesses of too much of the book.
Nothing good can ever come from globalisation, which is just more capitalism. Democracy, however, is a halcyon world of political and economic co-operation, citizen voice and engagement, with a freely arrived-at assertion of the common interest in which most think along the same lines as, say, Naomi Klein. She and free-market economist Milton Friedman, whom she has in her sights, are mirror images of each other in the absolutist categories in which they think.
So she is unlikely to convince anybody new, which is a pity, because she does hit some bull's eyes. Her description of the way corporate America has exploited the disasters of Hurricane Katrina, 9/11, the Iraq war and even the 2005 tsunami is devastating. The natural disaster that destroyed tens of thousands of lives in New Orleans was seen as an "opportunity"' to put the city's schooling and public housing in private hands; 9/11 became the excuse for the creation of a vast, private-security industry; and the Iraq war was based around the idea that the country could be organised as a pure, free-market paradise, partly because country and people alike were so traumatised that they would offer no opposition and partly because of the ideological belief that only unalloyed markets could deliver results. It was in Iraq that disaster capitalism had its purest, most self-destructive impact.
There are many lessons from Iraq, but they elude Klein. The fact that the neocons were wedded to an economistic and wrong view of democracy does not mean that the left should be automatically against all forms of market and conceive of democracy as a surrogate for socialism.
Rather, democracy is shorthand for a network of painfully constructed institutions: a free press, free unions, an independent legal and judicial system, the rule of law, the capacity to whistleblow, audit trails, transparency of decision taking, political parties, constitutional checks and balances to hold executive government to account, local power and free elections.
When capitalism works well, these institutions function well.
But they are more important than even that. Paradoxically, successful capitalism depends on the integrity it brings to the operation of markets and the organisation of corporations. What was wrong about so much shock therapy and the brutal introduction of markets that Klein describes was not that societies should have cleaved to a quasi-socialist alternative under the rubric of democracy. It was that they should have paid infinitely more attention to the building of the "soft" institutions of democracy, including universal education and health care, as the vital precondition for successful markets.
She does not recognise it, but the debate has moved on.
So The Shock Doctrine is a lost opportunity. It is hardly new that disasters and shocks are often triggers of change; her insight is to apply the thesis to turbo-capitalism and its ideologues. If Klein had been fairer, she would have had a smarter thesis that could genuinely have changed the intellectual climate.
As it is, she will be dismissed by her critics as a confused ranter. We need critics of free-market fundamentalism to do better than that.
-Observer
