The “New Normal” and the Shock Doctrine

By Marty Goodman, published on Socialist Action, May 11, 2020

Today only 51.3% of American adults have jobs – the lowest number on record, lower than the Great Depression. We have passed 80,000 coronavirus deaths.

But, even human suffering can make a billionaire’s eyeballs bulge when they look at the financial fallout. Why? For those at the top able to survive a deep crisis such as this, the playing field changes.  The system re calibrates vis a vis billionaires versus workers and one boss against another boss through the elimination of the weakest.

Naomi Klein’s The Shock Doctrine: The Rise of Disaster Capitalism (Picador, 2007) is an eye opening and extraordinarily potent book in 2020. Klein’s central thesis was expressed simply by Rahm Emanuel, the one-time Chief of Staff in the Obama administration and former neo-liberal Chicago Mayor, who once said, “Never let a crisis go to waste.”  Its meaning? As Klein explains, the corporate rulers know from history the strategic necessity of “using moments of collective trauma to engage in radical social and economic engineering.”

Trauma” can be defined as either ‘human made,’ i.e., a War (Iraq), the economic “shock” of the Margaret Thatcher/Reagan years, the 9-11 tragedy or “natural” phenomena like the coronavirus, a hurricane or a tsunami.

Friedman famously said that in a crisis “the actions that are taken depend on the ideas that are lying around.” For post-60’s capitalists and their Democratic and Republican leaders, the ideas “lying around” were his.

No matter the calamity, says Klein, tragedies are fresh meat for corporate barons. As Trump and both parties shower the bloated big corporations with over $500 billion in aid, virtually without oversight, the 2020 COVID-19 pandemic confirms Klein’s Shock Doctrine thesis — but she adds that it also can be an amazing opportunity for ordinary working people to force changes.

In an April 6 interview with The Intercept, Klein attacked the stark inequalities of capitalism that COVID-19 revealed,

“It is more lethal for people who whose immune systems are already weakened. African Americans have more stressful lives because they have more stressful jobs or multiple stressful jobs. But also because pollution is unevenly distributed in the United States because of environmental racism, and so this is an added irony to the fact that the fossil fuel companies are getting their wish list fulfilled in the midst of this pandemic and rolling back all of these controls on air pollution and water pollution.”

“Many workers are feeling their power in a way that they had not previously and there is a realization that they are indeed essential workers and they have been treated systematically in ways designed to belittle the value of their labor and we are seeing work stoppages across the economy and I think we’ll probably see more of those.”

What Is the Shock Doctrine?

Klein is so right. Her “Shock Doctrine” story began most dramatically in our time with the free-trade ideology of the Chicago University economics professor Milton Friedman (1912-2006). Friedman became the economic guru of the fascistic Augusto Pinochet, President of Chile. Pinochet murdered tens of thousands of Leftists and trade unionists after he seized power in 1973 in a CIA-orchestrated military coup against the elected Socialist Party government of Salvador Allende. Amidst the horror of military dictatorship, Friedman reshaped Chilean society with his “free-market” vision.

His reputation on the conservative Right enhanced, Friedman and his co-thinkers, nicknamed “the Chicago School,” became some of the ideological founding fathers of U.S. “neo-liberalism,” a modern form of “laisse fare” or free-trade capitalism. Free-trade means capitalists rip-off huge profits without obstruction from government regulation, be it through the absence of labor rights, stock market regulations, or the progressive taxation of the rich. Government ownership of services are to be rapidly privatized, sold at bargain basement prices to corporate crooks.

Freidman celebrated the corporate class as social visionaries. The governmental interventionism of President Franklin Delano Roosevelt and his “New Deal” which provided social services and minimal labor rights – after mass worker mobilization, i.e., strikes – was viewed by Freidman’s school of economics as an outmoded relic of 1930’s liberal capitalism.

As Michal Douglas said in the movie “Wall Street,” “Greed is good.” Ditto, thought Freidman.

The mood Friedman tapped into was a reflection of capitalism in crisis as profit margins were being squeezed by international competition. Capitalists shed all remaining moral hesitations, and remnants of 1960’s altruism, in the race to bolster the “bottom line.” Naked capitalist greed was always king, but its psychopathic, me first mantra was updated to give it an undeserved ideological ‘gravitas’ by Friedman & Co.

Klein’s book details how Friedman’s philosophy re-configured U.S. economic policy beginning with Ronald Reagan, George Bush I and II and, with some modification, essentially became the reigning ideology of the Clinton administration and, subsequent to her book’s publication, the Obama years too.

Capitalist Theory and Practice, or, How Low Can You Go?

Klein used these amongst many examples of the “Shock Doctrine” in recent history:

  • The 9-11 tragedy saw the creation of Homeland Security and the Patriot Act’s surveillance state, both bi-partisan measures. In 2006, Bush II signed the Defense Authorization Act, granting the president the ability to impose the powers of marshal law. With the repressive legislation in place came torture and indefinite detention and all the horrors of Guantanamo, much of which was performed by private contractors. With the repression also came the increased terror, harassment and deportation of immigrant workers (ICE), which meant increased profits for agribusiness and the service industry.
  • The Shock Doctrine or to use Bush II’s Iraq battle-cry “shock and awe” was in full view in New Orleans in 2005, a city ravaged by Hurricane Katrina. Encouraged by a Democratic Mayor, real estate vultures descended upon largely African American neighborhoods intent on “ethnic cleansing” via the gentrification of a city traumatized by over 1,500 deaths and the crass racism of Bush II. Said Richard Baker, a Republican Congressman from New Orleans, “We finally cleaned-up public housing in New Orleans. We couldn’t do it, but God did.”
  • The spread of Friedman’s capitalist fundamentalism was not at all confined to the U.S. In Poland, in the early ‘90’s, following the ouster of the corrupt Stalinist regime, the U.S. government orchestrated, with the help of the “liberal” Soros Foundation and the imperialist International Monetary Fund, a privatization drive that turned publicly held economic institutions into private, often U.S. held, corporations. The “shock” of transition threw millions into poverty, bought-off its labor leaders and hijacked the Polish economy.
  • South Africa’s epic transition from official apartheid in 1994 was to a “post-racial” neo-colonial, neo-liberal society subservient to the U.S. dominated World Bank. That relationship was solidified by neo-liberal deals cut with imperialism by the Nelson Mandela leadership and his successors. The double irony was the centrality of the South African Communist Party of which Mandela was a member. Today, the Black majority is in some ways worse off economically than it was under apartheid, where a white elite still runs the country. The current South African President, Cyril Ramaphosa, is also president of Mandela’s African National Congress (ANC) and is personally worth $450 million. South Africans complain of an ‘economic apartheid.’

No Time to Lose Our Nerve

On the April 15 “Democracy Now!” program, Klein urged the movements for change to seize the moment:

“If there is one thing history teaches us it’s that moments of shock are profoundly volatile, we either lose a whole lot of ground, get fleeced by elites and pay the price for decades or we win progressive victories that seemed impossible just a few weeks earlier. This is no time to lose our nerve. The future will be determined by whoever is willing to fight harder for the ideas they have lying around.”

Unfortunately, Naomi Klein endorsed Democratic candidate Bernie Sanders and is apparently willing to vote for Joe Biden as a lesser evil. Despite her ostensibly radical analysis and calls for movement building she advocates – no doubt not the first time – that activists dive deeper into the graveyard of social movements, that is, the Democratic Party. Warmonger Joe Biden will not advance Klein’s vision of a just world one single iota.

But, Klein’s first choice, Bernie Sanders is leading his many followers back into the swamp of the Democratic Party and “Shock Doctrine” politics. Too bad for socialists out there taking the bait, including Naomi Klein.

For a working class alternative, cast your vote for Jeff Mackler, the Socialist Action candidate for President!

*Featured Image:

Marty Goodman is a former board member of the Haitian Refugee Center of Miami. He witnessed the fall of Haitian dictator “Baby Doc” Duvalier in 1986 and was an official election observer in the 1990 election of former Haitian President Jean-Bertrand Aristide. He opposed the US/UN occupation of Haiti and is a member of the ‘Black Lives Matter in the Dominican Republic’ committee. Goodman is also a member of Socialist Action.

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