The Shock Doctrine
Naomi Klein
558 pages, including index
Published in 2007

Snow Crash was supposed to be a satire, but late in The Shock Doctrine Naomi Klein describes what's going on in the United States right now that sounds quite a lot like the future Neal Stephenson portrayed in his novel. There's a hollowed out federal government with all its core functions, especially warfare outsourced, while rich suburbs are seceding from their own cities to become commercialised, privatised towns with security by Blackwater mercenaries to leave the rest of America to rot away as surplus to requirements. The most shocking example that of New Orleans after Katrina, Disneyfied for the rich white tourists, its original, Black population dispersed all over the US, their neighbourhoods bulldozed to make way for more tourist attractions. All this, according to Klein, the logical end result of thirty years of disaster capitalism, pionered in the Latin American dictatorships of the seventies, matured in Eastern Europe in the late eighties/early nineties and reaching its zenith in Iraq in 2003 and New Orleans in 2005.

The Shock Doctrine is Naomi Klein's second big book about capitalism and globalisation, after No Logo. Both are critical exposes, but The Shock Doctrine is much angrier than No Logo ever was, more brutal, more pessimistic as well. Gone is the fascination and excitement that globalisation still had in the earlier book, when like a lot of anti-globalisation activists Naomi Klein could still admire the energy of it, even if fully aware of the horrendous costs its transformation of the world brought with it. It was the same kind of horrified fascination Karl Marx and Friedrich Engels showed for an earlier phase of globalisation, in the Communist Manifesto. In The Shock Doctrine this fascination has disappeared, replaced by disillusionment and anger.

It's tempting to see Naomi Klein's change in attitude as exemplary of a larger moodswing throughout the anti-globalisation movement. In the late nineties, though angry and disgusted what was happening to the world in the name of unbridled capitalism, the movement had an optimistic feel to it, a belief that globalisation of resistance to capitalism could work, was already working in changing the world for the better. It was in this spirit that No Logo was written, but by the time Klein followed it up with this book, this spirit had dissipated. What happened?

History came crashing back in, that's what happened. Both globalisation and the resistance against it happened in a historical vacuum in the nineties: the Cold War had ended, capitalism had triumphed over communism, the nation state was dead, multinationals would rule our lives from now on: the end of history had happened. And then came Bush, and 9/11 and the War on Iraq and suddenly everything we had imagined that was obsolete suddenly turned to life again. And once again it was possible to see the true roots of 21st century capitalism.

Which is what The Shock Doctrine is all about, tracing the roots of the system that made possible both the War on Iraq and the flooding of New Orleans, and how these twin disasters make possible megaprofits for the world's biggest companies: disaster capitalism. Naomi Klein shows how this form of capitalism got its starts in the economic theories of the Chicago School of Economics, with Milton Friedman as its greatest champion, was prototyped in Chile after the 1973 coup and from there on exported throughout South America. In the eighties it went global, wrecked havoc in Eastern Europe and Russia, became dominant worldwide in the nineties, including Europe and the US, then reached its zenith in Iraq. Throughout this triumph march, while the myth of globalisation spoke of unfettered capitalism freed from old-fashioned governmental interference freeing both markets and people, the reality was that it had never been possible without imposition through brute government force applied by dictatorships, against the will of their people.

Naomi Klein's core argument comes down to two ideas. The first, as said above, is that the Chicago School ideas about free market economies are an ideology that has to be imposed from above, the second that the best way to do this is during or shortly after a country is subjected to a heavy shock, when the population is too traumatised to resists this imposition. Like shock therapy in psychology, a country subjected to this process is first reduced to a blank slate, on which these theories can then be inscribed. It needs to happen fast and hard, overwhelming possible resistance with both force and speed. In short, it needs repression.

Which is why its trial run took place in Chile, after the 1973 coup against the social democratic government of Allende. It was only after thousands of unionists, socialists and other leftists had been tortured and murdered, the population cowed, that Milton Friedman's ideas of the free market could be introduced. And unlike the rightwing myths about Chile, were Pinochet saved the country from Marxist takeover, with Friedman and his Chicago School cronies only offering their services afterwards in making Chile free by making its markets free, Klein shows that Chicago played a big role in preparing the ground for the coup, as well as in those crucial days of the coup itself, as they planned the economic transformation of Chile. It's not just that the coup was needed to give these ideas a chance, but that the coup was carried out especially to force through changes that would've otherwise never have happened. The repression and the misery caused by this wrenching transition towards "free markets" that priced basic staples out of reach of millions while plundering Chile's economy for a small elite were two sides of the same coin. And while the repression eventually ended, the economic repression never has.

Once the shock doctrine had proven itself in Chile, it was rolled out all over South America, as country after country was ruled by military dictorships who destroyed its leftwing opposition before imposing economic reform on the poor. From there it travel all over the world, with Klein providing examples as diverse as eighties Britain, the experiences of countries like Poland and Russia after the end of the Cold War, as well as the Asian crisis of 1997 and the way countries like South Korea had to submit themselves to the "Washington consensus" in order to get help from the IMF and Worldbank.

In the process, Klein goes on to explain the way in which disaster capitalism transformed itself by its use of shock tactics. At first, shocks like the Chilean coup or the meltdown of the Asian Tiger economies were used solely to create a space in which socalled free market ideas could be forced upon unwilling countries, governments and peoples. The shocks were supposed to be temporary before the normal logic of the markets would reassert itself. But then capitalism discovered that its biggest profits were made not in normal times, but in times of shock and while using the power of government to get it its profits. Disasters, both real and created, became a normal way to do business. During a disaster companies could make huge profits providing services (or the appearance of services) the gutted, shrunk down state itself could no longer provide, while the empty spaces created by the disaster (quite literally in the empty beaches after the 2004 tsunami) provided new land for business to conquer...

The Shock Doctrine is a compelling, if difficult read, but I'm skeptical whether it is as a new a phenomenon as Klein made it out to be, only thirty-thirtyfive years old and whether Milton Friedman, who keeps popping up in the book, can be blamed as much as she blames him for it. The idea that true capitalism needs to be imposed from above and then defended against the people by their governments is not new; conservatie economist John Gray made the same point in his 1998 book False Dawn, when showing how unnatural the "free markets" of the nineteenth century were. And Friedman, while undoubtly influential, was not the only person advocating this radical form of capitalism. By focusing so much on him, Klein leaves many others, including every succesive US government, off the hook.