The Shock Doctrine - Naomi Klein
“In much of the Southern Hemisphere, Neo-liberalism is frequently spoken as the Second Colonial Pillage : In the first Pillage, the riches were seized from the land, and in the second they were stripped from the state.”
If you have never read this book, please do. From a long-time Horror reader, I can tell you its a Scarier read and lives longer in the memory than any Horror Fiction. The theme is that in the immediate aftermath of a Major event, be it a Natural Disaster or a War, people are far more susceptible to change than during normal conditions. This fact has been harnessed by Corporations and Governments to rush through legislation, designed to radically open up the Economy of a country and reduce the power of its Government, that under Ordinary conditions would draw fierce protest from Populations.
Klein begins by detailing a series of experiments carried out in the 1950's by the US Central Intelligence Agency called MKUltra. Its aim was to test various "Mind Control" techniques. This included giving test subjects LSD and observing others in Sensory Deprivation chambers. One area of research was particularly Horrific : They funded a Canadian based Pychatrist, Ewan Cameron, to carry out criminal tests on unwitting subjects. Cameron would dose his subjects with drugs and subject them to heavy blasts of Electro-shock therapy, many times greater than what was considered the safe limit. The intention was to make the Patient regress or wipe out their personality and roll them back to a childhood state where they could not think for themselves. They would be kept isolated in their rooms and denied stimulus such as Daylight, conversation or Newspapers for months on end. Cameron thought in this regressed state he could implant New ideas by playing instructions on tapes over and over again.
Based largley on MKUltras results, the CIA produced the Kubark manual, a series of detailed Torture lessons they would share out to any government willing to fight Left-wing factions within their own countries. The manual was soon in use by the 1960s in the likes of El Salvador, Ecuador, Columbia. The book laid out a strategy for breaking subjects down and extracting information. This would include keeping people in small holding cells, completely in the dark and devoid of outside contact. They could also be kept in stress positions. Their sleep would be disturbed continually and little food would be offered. Electroshock was also specified as the Pain method of choice. Again, the aim was to induce regression in the prisoners, through massive and repeated Shocks, in order to stop them thinking for themselves, breakdown any resistance they could offer and become obedient to their torturers.
It moves onto Milton Freidman an Economics Professor in Chicago was begun teaching what he saw as the advantages of Free Market economics over the Protectionist, Distributionist economic model that was widespread at the time. Freidman is described as something of a Fanatic, who believed in free markets with an almost Religious zeal and passed this on to many of his students. Friedman saw Free-market capitalism as “A perfect scientific system, one in which individuals, acting in their own self-interests, create the maximum benefits for all”. His biggest problem was that no Central Bank or Finance Ministry were showing interest in his views. Instead Keynesianism, Social Democracy and Developmentalism were the Economic ideas of the day. And they were doing quite well in developing countries across the Americas. As a result of this, Countries were charging a lot for their raw materials and Labour conditions were quite favourable for Workers. And so Large Multinational corporations, looking for a counter-revolution against this, became aware of Freidmans Free Market ideas…..
From there Klein illustrates what it takes to get this form of Economic model accepted. It begins in Chile 1973 when Augusto Pinochet, the head of the Army, stages a coup that overthrows the elected Government and murders the President Salvador Allende. The very same day he institutes a massive set of reforms drawn up by the so-called “Chicago Boys” , local economists who studied under Friedman years before. They drew up a set of proposals called the Brick, 500 pages prepared well in advance of the coup. In the immediate aftermath of the Shock of the Coup, while people are still finding their feet in the face of massive upheaval, Pinochet applies the Brick and another Shock in the form of Purges, Torture and Disappearances of those who dare protest. Chiles living standards plummet. All Govt subsidies in Food, Education, Transport etc are scaled back or removed sending their prices soaring. It has a hugely detrimental affect on Chiles poor. Unemployment and Poverty skyrocket.
This came on the back of CIA guided coups in Iran, Brazil, Guatemala, and Indonesia. All done in the name of defeating Communism but in truth all were about removing Democratic government that promoted redistributionist policies of National Assets.
These patterns were repeated across the “Southern Cone” in Argentina, Brazil, Uraguay, Peru. They all shared similar characteristics. Massive sweeping Economic reforms are made on the back of a Violent coup. These programs privatise public companies, ban Trade unions, tear up existing Labour Laws and massively scale back Govt spending. All leftwing Activists, anyone who was a member of a Socialist or Communist organisation, Trade Union members or critical of the new Regime would be arrested in dawn raids. They would be tortured and often murdered to send a message to the general population.
This Economic Shock therapy program is repeated again and again. In Britain, Margret Thatcher uses victory in the Falklands War to Privatise a huge section of the Public Service and defeat the Trade Union movement. In Bolivia, a new Democratic Governments betrays its mandate by carrying out Economic shock therapy to cure its Hyperinflation and is not afraid to kidnap and detain Trade Union leaders and other protestors. In Poland, the IMF compels the new Solidarity Movement to abandon its dreams of Worker Cooperatives and institute Shock Therapy programs that leave many people nostalgic for the old regime. In China, protests against its plans to introduce Chicago School capitalism are suppressed brutally in the Tiananmen square massacre. Many of the old Communist Party heads and their families wind up running the newly privatised state companies as millionaires. In South Africa, while the ANC draws up a new Charter for a democratic country, The ruling White government headed by FW de Clerk removes Economic Sovereignty from the government to preserve White wealth and tie the hands of any new Black government. In Russia, President Boris Yeltzin orders Tanks to shell the Moscow Parliament buildings to defeat politicians who resist his Extremely damaging Economic reforms. The same building he emerged from to face down an attempted coup only years earlier. The Asian collapse in the late 90s allows the IMF force South Korea, Thailand, Indonesia and Malaysia to enforce Shock therapy and open up their formerly protected Economies and Public services.
Besides the CIA, the books biggest Villan is the IMF. During the Bretton Woods conference, it was proposed to make sure that the economic desolation and poverty that made the Nazis possible in the aftermath of the collapse of the Weimar republic would never happen again. They would create the World Bank to make long term plans to keep countries out of Poverty. The IMF would act with it as an Overdraft facility, providing emergency funds to a Nation that has suffered rapid economic collapse. However unlike the UN the World Bank and IMF did not follow a “one country one vote” mechanism both allocated the most voting rights to the largest Economic powers, effectively giving the US a veto over any Plan. Both organisations were eventually “colonised” by Chicago school economists and in 1989 they introduced the “Washington Consensus”. As a condition of any loan to a country, the IMF would demand Privatisation of State assets, removal of all barriers to entry of Foreign capital and ownership and reduced Government spending. The IMF acts as a can-opener, prising open protected Economies around the world and allowing International Capital to flow in and snap everything up, usually at fire-sale prices.
There is a huge sense of Tragedy throughout the book. Whole Nations subjected to these Shock therapy programs instituted simply to concentrate more wealth and power in fewer hands. Large sections of populations, anything from 20%-60%, condemned to poverty. And due to the huge cutbacks in Govt spending in areas like Education and Social, its hard to see how they can ever get out. Millions tortured and executed, including 1 million leftists during Suharto’s rise to power in Indonesia.
Its also hard to imagine how none of this has become a national scandal in the US. Given how all of the CIAs activities in this book are a matter of public record, much of it coming by way of Congressional inquiries, it is little wonder that subsequent US governments under Bush-Clinton-Bush felt free to to continually push these allowed free-market reforms both abroad and at home. The hollowing out of the US Govt, where all public services are run by private enterprise proved disastrous for the people of New Orleans in the aftermath of Hurricane Katrina. The response was painfully slow and much of the rebuilding effort has focussed on building new apartments where poor slums once stood. And how the likes of Henry Kissinger is still a free man is a damning indictment. He directly supported Jorge Videlas Junta in Argentina, and even told him to do what had to be done quickly before the US congress would intervene and end the US status as an ally.
Last edited by BrendanGalway; 12-04-2010 at 10:11 AM.
The first robot president won by exactly one vote. Ah, yes! John Quincy Adding Machine. He struck a chord with the voters when he pledged not to go on a killing spree. But, like most politicians he promised more than he could deliver.