Book Review: Shock Doctrine

 

Analysis of Shock and X Way

            In her book Shock Doctrine, Naomi mentions two kinds of shock therapies. One is dealing in the individual level. Psychiatrists, Dr. Ewan Cameron as the leading role, treat the patients with shock. In order to completely heal the patients who suffer from traumas, abnormal behaviors, or other mental illnesses, psychiatrists try to rebuild memory over a clean state of mind on the patients. The first step is inducing regression of personality. Through shock, isolation, and information/sense deprivation, the personality, self-consciousness, and memory can be wiped out. Then the second step is constructing new memory so that the patients can develop a new identity in a normal state. As a result, it is true that the patients indicate a state of regression, but their mind is no longer healthy or functional. They suffer from confusion and disorientation. Therefore, the method is controversial since the patients are not better off after the treatment. However, the method is perfect for destroying political resistant and war enemies. Through physical and psychological torture, terror and pain make the prisoners to be disorientated, obedient, brainwashed, or mental disordered. The shock therapy on individuals is effective to destroy the prisoners and to threaten their families and the society in order to achieve collective repression, regardless the prisoners are innocent or not.

Another shock therapy is dealing in the national scale by applying economic or political measures. History is a continuous flow made up by series of stories. History is memory, the core of individual identity and national identity. Shock creates the fraction in the memory. Since the incident is sudden, traumatic, and desperate, the society does not have appropriate mechanism to respond or alleviate the impact. People would be in panic and disorientation. They need orders, leaders, and supports. The paralyzed situation is the best soil to implant new ideas and rules to start a new game. The following patterns keep repeating in human civilization, beyond time and space. Pattern One: initiation of a new era due to the progress of technology. The system is challenged by the new cooperation and communication between people due to the change in method and efficiency of productivity. Political and economic measures need to be adjusted accordingly because the old system is malfunctioned to encourage the new cooperation. At this time, many different ideologies pop out across the society. The previous authority/institution is falling apart. The society is fractioned since people adopt different ideologies. People with common ideas or interests ally to promote their ideas to the rest of society. Therefore, various forms of revolutions and regimes arise and fall. It is high risk that regime with radical ideology would rule over. Tons of examples can be cited since the Industrial Revolution. Pattern Two: invasion. Invasion can be in the form of politics or economics. The purpose of invasion is competing for economic interests or geopolitical influence/power. Colonization is a form of invasion. The expansions of Communism (extreme left) and unrestrained Capitalism (extreme right) are also forms of invasions. Naomi’s Shock Doctrine focuses on the invasion of Capitalism since global Capitalism prevails in contemporary civilization. I will pick some examples to explain how the expansion of Capitalism “shocks” the globe.

After independence, Chile has lingered between conservatism and liberalism. Military rules and coups were frequent. Regimes were short-lived, so as the policies that each regime promoted. Judiciary system and governmental structure had struggled to establish. Fundamentally speaking, Chile only had nominal independence. Foreign players had prominent influence in politics and economy. The powerful groups did not reach compromise in the distribution of interests. In the past, elite families, the Roman Catholic Church, and wealthy landlords were dominant players of the game. They had profound connections with the European power. Since the US has arisen and became the regional superpower, the role of the big boss shifted to the US. The US corporations had a huge share of interests in Chile’s economy. Therefore, any move in politics had impact to those US corporation elites.

In the 1970s, Allende, a left-winged politician, became the president. He promoted socialist platforms, such as nationalize US interests in Chile’s copper mines, advance workers’ rights, land reform, reorganize the national economy into socialized, mixed, and private sectors, etc. The point of his reform was redistributing wealth and resources from the foreign control to the national/domestic control. Certainly, Allende administration became the enemy of those US corporations. For Nixon, Allende’s regime should be overthrown mainly for two critical reasons: harmful to the US interests; threatening to Capitalism because Chile might be the regional model in Latin America to deviate from the ideology of free market. Therefore, Nixon gave instructions to shock the Chilean economy. He imposed economic sanctions. International financial pressure restricted economic credits to Chile. After the prosperous economic growth of Allende’s first year’s presidency, Chile suffered from economic depression and high inflation. Furthermore, the CIA supported coup was successfully conducted and Pinochet, the Commander of the army, turned out as the dictator. He adopted the economic blueprint of the Chicago boys. Chicago boys are students who received education in the Economy School of Chicago University. They are the followers of Milton Freeman, the leading economist of free Capitalism. Under Chicago boys’ advise, Pinochet made a U-turn on Chile’s economic policies, such as removal of price controls, sale of state companies, removal of import barriers, and cuts to governmental expenditure (like social welfare). In order to stabilize the society and advance his policies, Pinochet suppressed the resistant with confine, torture, and disappearance. Many of the victims were falsely accused. As a result, the GDP of Chile did grow, but the gap between wealth and poor has enlarged.

Chile is a stereotype of many Latin American countries; those south-coned countries shared similar history and fate. They have struggled to gain true independence. In the last chapter of the book, Naomi mentioned that many Latin countries try to find the balance between Capitalism and Socialism, to democratize politics, to seek more equal in wealth distribution, and to negotiate cooperation with other Asian countries as the contemporary policies. In my opinion, social mobility should be the essential element to consider as making development plans and policies. Because people need to have hope, the hope that it is possible to improve life and establish achievement through individual efforts, regardless race, ethnicity, class, and family background. In the cases of Latin countries and many other developing countries, the first step is gaining economic and political controls on resources and crucial industries (according to the resources and comparative advantages of the countries, categories of crucial industries are various), because those resources and industries directly connect to people’s livelihood in one country. If those departments are controlled by foreign corporations, it is equivalent to give the sovereignty to the foreign countries. Therefore, nationalization of those resources and industries is a rational choice for the countries. For two reasons: first, the governments need revenues to function; second, the governments have capability to mobilize resources in the national scale in this initiative stage. Then the second step is protecting property ownership and encouraging private entrepreneurship to stimulate productivity. Many countries still have high trade barriers according to their situation in order to protect infant industries. Domestic capital mobility might be smooth, but some countries have tight control on international capital flow to prevent foreign speculation and capital flight. The third step is more cooperation with the globe and deepen privatization. Some countries would privatize infrastructures and financial sectors accordingly. Since countries have their specific issues, this step is too complicated to generalize. But my point here is that each country should have the balance between Capitalism and Socialism. Unrestraint Capitalism would make the social structure like a dumbbell, large gap between the wealth and the rest of the society. Mobility is almost impossible among classes. On the other hand, socialism that stress on equality of distribution discourages productivity.

Naomi also mentions about privatization of military-industrial complex, infrastructures, and many governmental functions. Especially during the Bush administration, Donald Rumsfeld had taken the advantage of his high positions in both of the government and the business sector to privatize much of the US military. Besides him, many officials work on both to promote the vocation of privatization. During the war in Afghanistan and Iraq, the ammunition and construction companies that contract with the US government made a great sum. Of course, the Iraq War 2003 was a shock treatment of US capitalism expansion imposing on Iraq. Simply speaking, the US conducted three steps of shock. First was the war to disable Iraq’s public functions. Terror strike against Iraqis, their homeland was destroyed. Second was economic shock therapy. Again, Chicago economy of free market jumped on the stage. The US-sent officials pass classic Chicago school laws. They fired 500,000 state workers to shrink the Iraq’s public services. Reconstructure funds were spent on the US corporations, which contract with the US government, to entrust with infrastructure buildings. The reconstructure projects ignored the welfare of the majority. They built a green zone in Bagdad, a privatized secure zone, to separate the chaotic red zone, where the major public lived on. Frankly speaking, the politics and business served the western interests in the whole region. Third was shock of enforcement. Resistants were confined, tortured, or executed. In sum, the contracted US corporations were the beneficiaries of the war. The victims were the Iraqi civilians.

Naomi argued that the US government would only has the shell since many functions, including the army, strategic planning, homeland security, defense, and public infrastructures, are subcontracted to the private business. Wars, custody, and natural disasters are profitable because they provide the demand to those governmental-financing corporations. I think this extreme form of Capitalism—disaster Capitalism as Naomi called it, is dangerous. First of all, the system is no longer benefit to the welfare of the whole human beings. Since the contemporary system faces the crisis of overaccumulation (detailed explanation refer to the previous essay), regular consumption/demand is too “little” to fuel the running of the system. However, mass destruction, whether it is man-made disaster or natural disaster, can generate a great amount of demand. In another word, the system has evolved to destruction-dependence. Based on this logic and the facts, the disaster Capitalism separates people to the green zone and the red zone. Like Bagdad after the war, the business elites, a tiny percentage in the population, harvest the wealth of the destruction and live in the green zone of the globe, where has the best resources. The rest of population, including the middle class, lives in the red zone.

Sri Lanka after the 2004 Indian Ocean tsunami is a stereotype example of how disaster Capitalism taking advantage of natural disaster. Before the tsunami, the local fishermen had resided along the shore for generations. Since more and more Pacific islands are opened to resorts, the fishermen have conflicts with developers from big companies, who attempt to build hotels and recreational infrastructures along the shore to attract tourists. After the tsunami, everything was wiped out. The fishermen tried to return to the shore and rebuild their community. However, the government banned their return with the excuse of protecting their safety. They can only live in the temporary huts, which later as the slums. Contradiction with the excuse, flood of developers of the construction companies occupy the shore to build hotels and recreational centers. For the developers, they are thankful to the tsunami to clean the obstacles that block their economic revenue. For the fishermen, the ban is like the second tsunami. They face the dislocation of Capitalist invasion.

In the case of Sri Lanka, I partially agree with the government’s action. I understand that it is painful to have dislocation, but those fishermen would be better off to move from their life style. Because their productivity was so inefficient; also, their living quality should be improved in terms of housing, education, and medication. Therefore, the government should organize the both sides, fishermen and business corporations, to reach some sorts of compromise (if it is possible). The government can support the training programs in the corporations to assist the fishermen be the employees of the corporations. If the fishermen want to start a business, they can remodel their houses as guesthouses and provide service to the tourists. The government should financially support their entrepreneurship. Since the fishermen are local, the style of their guesthouses, food, even recreation can be ethnical. I believe many tourists would prefer their guesthouses than the hotels.

I agree that disaster Capitalism is a problem. I think every country needs a balance between Capitalism and Socialism, but the premise is that the country has to be strong in state autonomy and capacity so that the compromise between interest groups is possible. In addition, since the history and issues of states are different and unique, I think using labels such as “Capitalism”, “Socialism”, or whatever is too dogmatic. Naomi’s criticism on unrestraint Capitalism is informative, but it would be nice if she can offer some solutions or the ways that the system should work on.

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