Tag: Shock Doctrine

The auto industry Big Three were loyal only to shareholders, not the people of Detroit. The city was gutted by that social choice

Capitalism as a system ought to be judged by its failures as well as its successes.

The automobile-driven economic growth of the 1950s and 1960s made Detroit a globally recognized symbol of successful capitalist renewal after the great depression and the war (1929-1945). High-wage auto industry jobs with real security and exemplary benefits were said to prove capitalism’s ability to generate and sustain a large “middle class”, one that could include African Americans, too. Auto-industry jobs became inspirations and models for what workers across America might seek and acquire – those middle-class components of a modern “American Dream”.

True, quality jobs in Detroit were forced from the automobile capitalists by long and hard union struggles, especially across the 1930s. Once defeated in those struggles, auto capitalists quickly arranged to rewrite the history so that good wages and working conditions became something they “gave” to their workers. In any case, Detroit became a vibrant, world-class city in the 1950s and 1960s; its distinctive culture and sound shaped the world’s music much as its cars shaped the world’s industries.

Over the past 40 years, capitalism turned that success into the abject failure culminating now in the largest municipal bankruptcy in US history.

Kicking off a series of speeches about the economy, President Obama told a crowd in Illinois on Wednesday that reversing growing inequality and rejuvenating the middle class “has to be Washington’s highest priority.” During his remarks, Obama failed to mention the bankruptcy filing by Detroit, where thousands of public workers are now fighting to protect their pensions and medical benefits as the city threatens massive cuts to overcome an estimated $18 billion in debt. Detroit’s bankruptcy “is an example of a failed economic system,” says economist Richard Wolff, professor emeritus of economics at University of Massachusetts

Conservatives want you to think high taxes drove people away. The real truth is much worse for their radical agenda

In the wake of Detroit’s bankruptcy, you may be wondering: How could anyone be surprised that a city so tied to manufacturing faces crippling problems in an era that has seen such an intense public policy assault on domestic American manufacturing? You may also be wondering: How could Michigan officials possibly talk about cutting the average $19,000-a-year pension benefit for municipal workers while reaffirming their pledge of $283 million in taxpayer money to a professional hockey stadium?

These are fair questions – and the answers to them can be found in the political mythology that distorts America’s economic policymaking.

As mythology goes, the specific story being crafted about Detroit’s bankruptcy is truly biblical – more specifically, just like the fact-free mythology around the Greek financial collapse, it is copied right from the chapter in the conservative movement’s bible about how to distort crises for maximum political effect.

Yes, because no one listened to those that warned(including myself) this would happen in 2010 with the Bush tax cut sellout leading to the debt ceiling debacle in 2011 to now, it looks like the sequester created by this White House and Congress is going to happen. Back then, there was leverage with the Bush tax cuts expiring for using the High Value Platinum Coin, invoking the 14th amendment, or legislating the debt ceiling away entirely. None of this was considered even as a temporary measure to avoid this epic failure fixing to hit our shores.

It’s insulting to the public that none of this was even tried, because this sequester will be painful and more painful in the future. The political damage as we create more miniature crisis will be even costlier than what is projected as more bills have to be passed every few months which always get worse the more they are revisited, all needlessly created all in the name what I call deficit terrorism. Through each bipartisan crisis more austerity is brought out in these miniature Shock Doctrine scenarios especially on the debt ceiling. This austerity will eventually terrorize the public because a failure to govern or understand our economy.

Sure, it will take awhile to be phased in and each federal agency will implement its cuts differently, on its own timeline, but by April 4th, 2013 some real pain is likely to be felt by the public.

Naomi Klein, author of Shock Doctrine: The Rise of Disaster Capitalism,, joined Bill Moyers to discuss how the the destructive force of Hurricane Sandy and climate change can alter politics and the economy.

The full transcript can be read here.

Lambert Strether, posting at naked capitalism, thought this part of the interview particularly interesting.

   NAOMI KLEIN: So one of the things that you find out in a disaster is you really do need a public sector. It really important. And coming back to what we were talking about earlier, why is climate change so threatening to people on the conservative end of the political spectrum? One of the things it makes an argument for is the public sphere. You need public transit to prevent climate change. But you also need a public health care system to respond to it. It can’t just be ad hoc. It can’t just be charity and goodwill.

   BILL MOYERS: When you use terms like “collective action,” “central planning,” you scare corporate executive and the American Enterprise Institute and The Heritage Foundation because they say you want to do away with capitalism.

   NAOMI KLEIN: Well, first of all, I don’t use a phrase like “central planning.” I talk about planning, but I don’t think it should be central. And one of the things that one must admit when looking at climate change is that the only thing just as bad or maybe even worse for the climate than capitalism was communism. And when we look at the carbon emissions for the eastern bloc countries, they were actually, in some cases, worse than countries like Australia or Canada. So, let’s just call it a tie. So we need to look for other models. And I think there needs to be much more decentralization and a much deeper definition of democracy than we have right now.

   BILL MOYERS: Decentralization of what, Naomi?

   NAOMI KLEIN: Well, for instance, you know, if we think about renewable energy, well, one of the things that’s happened is that when you try to get wind farms set up, really big wind farms, there’s usually a lot of community resistance that’s happened in the United States. It’s happened in Britain. Where it hasn’t happened is Germany and Denmark. And the reason for that is that in those places you have movements that have demanded that the renewable energy be community controlled, not centrally planned, but community controlled. So that there’s a sense of ownership, not by some big, faceless state, but by the people who actually live in the community that is impacted.

What Yves said: “These pesky issues of governance, the nature of the state, and legitimacy seem to popping up all over these days.”

At a speaking event in New York City this week, award-winning journalist and author Naomi Klein discussed why the reconstruction from Superstorm Sandy is actually a great place to usher in progressive change. Klein’s latest article for The Nation magazine is called, “Superstorm Sandy – a People’s Shock?” She is the author of the best-selling book, “The Shock Doctrine: The Rise of Disaster Capitalism,” and is now working on a book about climate change

Transcript can be read here

Less than three days after Sandy made landfall on the East Coast of the United States, Iain Murray of the Competitive Enterprise Institute blamed New Yorkers’ resistance to big-box stores for the misery they were about to endure. Writing on Forbes.com, he explained that the city’s refusal to embrace Walmart will likely make the recovery much harder: “Mom-and-pop stores simply can’t do what big stores can in these circumstances,” he wrote. [..]

The same day, Frank Rapoport, a lawyer representing several billion-dollar construction and real estate contractors, jumped in to suggest that many of those public works projects shouldn’t be public at all. Instead, cash-strapped governments should turn to “public private partnerships,” known as “P3s.” That means roads, bridges and tunnels being rebuilt by private companies, which, for instance, could install tolls and keep the profits. [..]

Ray Lehmann, co-founder of the R Street Institute, a mouthpiece for the insurance lobby (formerly a division of the climate-denying Heartland Institute), had another public prize in his sights. In a Wall Street Journal article about Sandy, he was quoted arguing for the eventual “full privatization” of the National Flood Insurance Program, the federal initiative that provides affordable protection from some natural disasters-and which private insurers see as unfair competition.

But the prize for shameless disaster capitalism surely goes to right-wing economist Russell S. Sobel, writing in a New York Times online forum. Sobel suggested that, in hard-hit areas, FEMA should create “free trade zones-in which all normal regulations, licensing and taxes [are] suspended.” This corporate free-for-all would, apparently, “better provide the goods and services victims need.”

Ms. Klein is speaking on Friday night at the Hammerstein Ballroom in New York City as part of 350.org’s “Do the Math” tour with Bill McKibben.

Cross posted at out new beta site Voices on the Square and in Orange

In lieu of meaningless political convention coverage, my title is absolutely still true. Decades and decades of history refutes any excuses about the so called political expediency of wasting any crisis economic or otherwise. That is one of the only things I agree with Rahm Emanuel on when he said it at the beginning of this administration. Sadly, the White House only listened to his hippy punching BS. The prospect that this economic disaster wouldn’t go to waste or enrich bankers was where the hope used to reside when there was any at all to confide in as far as any real economic recovery is concerned.

But when we mention these real world problems still abound from these failures we hear the same old tired excuses trotted out to excuse this administration from loyal partisans who are proud of what they never learn. This involves excusing the the bailout, housing, and foreclosure crisis. Ironically, this is why there is any chance at all for insane Republicans to make hay in this election at all so it might be smart to pay attention to it at some point even if the media won’t cover it. The bottom line is that coddling too big to fail banks with trillions in bailouts and more bailout guarantees on top of that (29 trillion globally when counted all up) to make Capital whole at the expense of laborers didn’t help and many of us knew it wouldn’t from the get go.

During an election it is treated like a crime to say so. You know, other countries have actually learned this lesson as we have forgotten from the past. Alas Iceland handled their crisis well, like Sweden, and like we did during the S&L crisis but not in 2008 where our fate is now a lost decade or two. With too many loyal “Democrats” looking the other way, this administration and their point man in the Treasury let Wall St have the most say even though public anger at Wall St was and is still at an all time high. This explains why the public was against the bailout, and how it failed in the House at first.

Recently Naomi Klein, the author of the “Shock Doctrine: The Rise of Disaster Capital Management”, has appeared on the Rachel Maddow Show and with Amy Goodman on Democracy Now discussing Anti-Union Bills and Disaster Capital Management American-Style:

   NAOMI KLEIN: Well, I just found out about this last night, and like I said, there’s so much going on that these extraordinary measures are just getting lost in the shuffle. But in Michigan, there is a bill that’s already passed the House. It’s on the verge of passing the Senate. And I’ll just read you some excerpts from it. It says that in the case of an economic crisis, that the governor has the authority to authorize the emergency manager-this is somebody who would be appointed-to reject, modify or terminate the terms of an existing contract or collective bargaining agreement, authorize the emergency manager for a municipal government-OK, so we’re not-we’re talking about towns, municipalities across the state-to disincorporate. So, an appointed official with the ability to dissolve an elected body, when they want to.

   AMY GOODMAN: A municipal government.

   NAOMI KLEIN: A municipal government. And it says specifically, “or dissolve the municipal government.” So we’ve seen this happening with school boards, saying, “OK, this is a failing school board. We’re taking over. We’re dissolving it. We’re canceling the contracts.” You know, what this reminds me of is New Orleans after Hurricane Katrina, when the teachers were fired en masse and then it became a laboratory for charter schools. You know, people in New Orleans-and you know this, Amy-warned us. They said, “What’s happening to us is going to happen to you.” And I included in the book a quote saying, “Every city has their Lower Ninth Ward.” And what we’re seeing with the pretext of the flood is going to be used with the pretext of an economic crisis. And this is precisely what’s happening. So it starts with the school boards, and then it’s whole towns, whole cities, that could be subject to just being dissolved because there’s an economic crisis breaking collective bargaining agreements. It also specifies that-this bill specifies that an emergency manager can be an individual or a firm. Or a firm. So, the person who would be put in charge of this so-called failing town or municipality could actually be a corporation.

We are now seeing the push to fulfill this agenda to make “harsher American less democratic”.  Not  only are they stripping the rights of workers but the Republican corporate agenda is now going after the one remedy that Americans have to stop them, voting rights. Currently there are bills under consideration in 32 states to make it harder to vote in 2012, by forcing people to ID that the poor, minorities and students that they have difficulty obtaining, eliminating same day registration and restricting the voting rights of people who have served time in prison.