The Pinochet coup in Chile laid the groundwork for Friedmanite political, military, and economic coups, including systematic torture and murder, in dozens of countries for decades, up to and including Russia, Israel, Afghanistan, Iraq, and the US. Then it went on to simply having the World Bank and IMF require Friedmanite economic measures in any country with economic and financial difficulties, regardless of the will of the people.
- Coups: Bolivia, Brazil, Indonesia, Argentina, Uruguay, Honduras, Guatemala, Colombia, Ghana, South Korea, Lebanon
- Loan conditions: Russia, Poland, the four Asian Tigers, South Africa
- Natural disasters: Tsunami in Sri Lanka, New Orleans after Katrina
- War: Former Yugoslavia, Falklands (supporting Thatcherism in the UK), 9/11 in the US, Afghanistan, Iraq
- China under Deng Xiaoping
- Elections: Reaganism, Sarkozy in France, Turkey, Hungary, Poland, Mexico, Singapore, Hong Kong, Taiwan, Israel
Since then many of those countries have taken their politics, societies, and economies back. Not Russia or Israel, though. Russian Jews coming to Israel have on one hand displaced Palestinian guest workers, removing any motivation for Bibi to seek a peace deal overall or in the war on Hamas. At the other end of the scale, Russian Jews with technical skills have caused a boom in high-tech industries in Israel, particularly in national security export markets as part of the global Disaster-Industrial Complex.
The Theory of Economic Shocks
The major error, in my opinion, is to believe that it is possible to do good with other people’s money.
Milton Friedman, to General Pinochet
Milton Friedman had argued, in Capitalism and Freedom,
Only a crisis—actual or perceived—produces real change. When that crisis occurs, the actions that are taken depend on the ideas that are lying around. That, I believe, is our basic function: to develop alternatives to existing policies, to keep them alive and available until the politically impossible becomes politically inevitable.
Therefore it became necessary, in his view, to create the crises that would allow his vicious nonsense to be put into practice.
It was crucial to act swiftly, to impose irreversible change before the crisis-wracked society slipped back into “the tyranny of the status quo”.
Klein calls this “disaster capitalism”.
We have seen this radical “Free Market” movie over and over.
- Privatize everything owned publicly
- Outsource government and military functions
- For-profit relief and reconstruction, using only foreign corporations and employees
- Allow unrestricted foreign investment, aka piracy
- Remove all restrictions on money flows
- Take down safety net programs, including pensions, unemployment, and health care
- Tax cuts and a flat tax
- Deregulation
- School vouchers
- Erase the poor
- Demonize the opposition as Communists or terrorists
resulting in mass unemployment, mass poverty, and massive inflation.
You may notice that all of these are still the policies of the Republican Party.
Military Shock and Awe
The National Defense University published Shock and Awe: Achieving Rapid Dominance in 1996, and put it into effect in the second Iraq war. Saddam Hussein’s military did indeed collapse in ruins, but so did Iraqi society and its economy. There were no prior plans for peacekeeping or rebuilding either, other than the Neocon wish fulfillment fantasy of the Project for the New American Century, that democracy, human rights, and a rapidly expanding economy would automatically result from the invasion. But their plans were grounded in Friedmanism, in total privatization, outsourcing, and internationalization of supposed reconstruction.
Shock and Awe are actions that create fears, dangers, and destruction that are incomprehensible to the people at large, specific elements/sectors of the threat society, or the leadership. Nature in the form of tornadoes, hurricanes, earthquakes, floods, uncontrolled famine, and disease can engender Shock and Awe.
We note for the record that should a Rapid Dominance force actually be fielded with the requisite operational capabilities, this force would be neither a silver bullet nor a panacea and certainly not an antidote or preventative for a major policy blunder, miscalculation, or mistake.
Thus the Disaster-Industrial Complex.
Note the current application of this doctrine in Gaza, specifically including famine and disease, with far more than one “major policy blunder, miscalculation, or mistake” at a time.
The traditional Arab proverb for Rumsfeld and Bibi is
Man in a hurry pisses twice.
except that both ran on for more than a decade.
Before World War II, American scholarship in the profession of arms matured in each of the military services more or less independently.Requirements for advanced education for leaders of the nation's military and naval forces were met as they arose through postgraduate colleges set up by and for the respective services. The 20th century imposed a growing need for closer ties between force and diplomacy, between America's military services and the industries that arm them, and particularly among our military centers of higher learning and research. This led to the creation of the Army Industrial College in 1924 and, after World War II, the formation of joint colleges of higher learning. These new joint colleges included the Armed Forces Staff College, the National War College, and the Army Industrial College, which later became the Industrial College of the Armed Forces.
NDU was established in 1976 to consolidate intellectual resources and provide joint higher education for the nation’s defense community. The Industrial College of the Armed Forces (now the Dwight D. Eisenhower School for National Security and Resource Strategy) and the National War College were the original two constituent colleges of the new institution. The Armed Forces Staff College (now the Joint Forces Staff College) was added to the university in 1981. A year later, the Department of Defense Computer Institute (now the College of Information and Cyberspace) joined. The university’s newest school is the College of International Security Affairs, which was created in 2002 as the School for National Security Executive Education.
New Beginnings
The pinnacle of Friedmanism came in 2006, when the UN reported that 2% of the world’s population owned more than half of its assets. Friedman died in November 2006, as all of his life’s work was starting to unravel. As with the Roman Empire, its Decline and Fall necessarily began at its most triumphant peak. Bush’s policies in Iraq were also coming under increased condemnation, paving the way for Barack Obama’s election, aided by the housing market bubble bursting. There was also an astonishing array of national scandals and arrests around that time.
- Chile: Pinochet was under house arrest when Friedman died and his policies were being undone. Pinochet died without being put on trial.
- Uruguay: Police arrested Juan Maria Bordaberry on murder charges.
- Argentina: The courts stripped the coup leaders of legal immunity, and put several on trial.
- Bolivia: Former President Sánchez was wanted for murder and financial crimes. Evo Morales had replaced him with the support of indigenous peoples’ movements.
- Russia: Friedmanite economic advisers and oligarchs were found guilty of fraud and other financial crimes.
- US: Enron’s Ken lay died in 2006, having been convicted of massive financial fraud.
- Venezuela: The much demonized Hugo Chavez won an election in 2006 on a platform of 21st Century Socialism.
- Ecuador: Rafael Correa won election over a banana tycoon.
- EU: The proposed corporatist Constitution was rejected by the voters. Twice.
- Israel: Bibi Netanyahu is finally facing trial for corruption.
There are hundreds of thousands of examples of people taking charge of their own economic destiny and pushing the corporatists aside, such as activists in New Orleans arranging with local contractors for repairing damaged houses. I can’t begin to cover it all. nor did Klein attempt to.
Bidenomics
- Privatize everything owned publicly—Revitalize the public sector and make it work for people and wildlife
- Outsource government and military functions—Undo outsourcing
- For-profit relief and reconstruction—Government and non-profit missions
- Allow unrestricted foreign investment, aka piracy—Rein in unfair competition, rebuild US manufacturing
- Remove all restrictions on money flows—Regulate markets, financial institutions and capital flows
- Take down safety net programs, including pensions, unemployment, and health care—Strengthen and expand them all
- Tax cuts and a flat tax—Emphasize the failure of Trickle-Down Reagaomics; Build the economy from the bottom up and the middle out; Make corporations and the rich pay their fair share, and expand Social Security contributions to higher income levels
- Deregulation—Reregulation, serious antitrust
- School vouchers—Rebuild public schools and fund teacher salaries
- Erase the poor—Focus policy on the poor and oppressed
- Demonize the opposition as Communists or terrorists—Do the maximum good possible for everyone, particularly including those who can’t stand that. Rehabilitate the demonized.
Next Up
I meant to say last week that I am working on Thinking: Fast and Slow. We will finally get out from all of this vicious nonsense, and look at ideas that are starting to replace it.
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