In THE SHOCK DOCTRINE, Naomi Klein explodes the myth that the global free market triumphed democratically. Exposing the thinking, the money trail and the puppet strings behind the world-changing crises and wars of the last four decades, The Shock Doctrine is the gripping story of how America’s “free market” policies have come to dominate the world– through the exploitation of disaster-shocked people and countries.
At the most chaotic juncture in Iraq’s civil war, a new law is unveiled that would allow Shell and BP to claim the country’s vast oil reserves…. Immediately following September 11, the Bush Administration quietly out-sources the running of the “War on Terror” to Halliburton and Blackwater…. After a tsunami wipes out the coasts of Southeast Asia, the pristine beaches are auctioned off to tourist resorts…. New Orleans’s residents, scattered from Hurricane Katrina, discover that their public housing, hospitals and schools will never be reopened…. These events are examples of “the shock doctrine”: using the public’s disorientation following massive collective shocks – wars, terrorist attacks, or natural disasters — to achieve control by imposing economic shock therapy. Sometimes, when the first two shocks don’t succeed in wiping out resistance, a third shock is employed: the electrode in the prison cell or the Taser gun on the streets.
Based on breakthrough historical research and four years of on-the-ground reporting in disaster zones, The Shock Doctrine vividly shows how disaster capitalism – the rapid-fire corporate reengineering of societies still reeling from shock – did not begin with September 11, 2001. The book traces its origins back fifty years, to the University of Chicago under Milton Friedman, which produced many of the leading neo-conservative and neo-liberal thinkers whose influence is still profound in Washington today. New, surprising connections are drawn between economic policy, “shock and awe” warfare and covert CIA-funded experiments in electroshock and sensory deprivation in the 1950s, research that helped write the torture manuals used today in Guantanamo Bay.
The Shock Doctrine follows the application of these ideas through our contemporary history, showing in riveting detail how well-known events of the recent past have been deliberate, active theatres for the shock doctrine, among them: Pinochet’s coup in Chile in 1973, the Falklands War in 1982, the Tiananmen Square Massacre in 1989, the collapse of the Soviet Union in 1991, the Asian Financial crisis in 1997 and Hurricane Mitch in 1998.
If you’ve used the internet at any point in the past few weeks, you’ve probably heard of Juicero. Juicero is a San Francisco-based company that sells a $400 juicer. Here’s how it works: you plug in a pre-sold packet of diced fruits and vegetables, and the machine transforms it into juice. But it turns out you don’t actually need the machine to make the juice. On 19 April, Bloomberg Newsreported that you can squeeze the packets by hand and get the same result. It’s even faster.
The internet erupted in laughter. Juicero made the perfect punchline: a celebrated startup that had received a fawning profile from the New York Times and $120m in funding from blue-chip VCs such as Kleiner Perkins Caufield & Byers and Google Ventures was selling an expensive way to automate something you could do faster for free. It was, in any meaningful sense of the word, a scam. And it tickled social media’s insatiable schadenfreude for rich people getting swindled – not unlike the spectacle of wealthy millennials fleeing the cheese sandwiches and feral dogs of the Fyre festival.
Juicero is hilarious. But it also reflects a deeply unfunny truth about Silicon Valley, and our economy more broadly. Juicero is not, as its apologists at Voxclaim, an anomaly in an otherwise innovative investment climate. On the contrary: it’s yet another example of how profoundly anti-innovation America has become. And the consequences couldn’t be more serious: the economy that produced Juicero is the same one that’s creating opioid addicts in Ohio, maimingauto workers in Alabama, and evicting families in Los Angeles.
These phenomena might seem worlds apart, but they’re intimately connected. Innovation drives economic growth. It boosts productivity, making it possible to create more wealth with less labor. When economies don’t innovate, the result is stagnation, inequality, and the whole horizon of hopelessness that has come to define the lives of most working people today. Juicero isn’t just an entertaining bit of Silicon Valley stupidity. It’s the sign of a country committing economic suicide.
At the root of the problem is the story we tell ourselves about innovation. Stop me if you’ve heard this one before: a lone genius disappears into a garage, preferably in Palo Alto, and emerges with an invention that changes the world. The engine of technological progress is the entrepreneur – the fast-moving, risk-loving, rule-breaking visionary in the mold of Steve Jobs.
This story has been so widely repeated as to become a cliche. It’s also inaccurate. Contrary to popular belief, entrepreneurs typically make terrible innovators. Left to its own devices, the private sector is far more likely to impede technological progress than to advance it. That’s because real innovation is very expensive to produce: it involves pouring extravagant sums of money into research projects that may fail, or at the very least may never yield a commercially viable product. In other words, it requires a lot of risk – something that, myth-making aside, capitalist firms have little appetite for.
This creates a problem. Companies need breakthroughs to build businesses on, but they generally can’t – or won’t – fund the development of those breakthroughs themselves. So where does the money come from? The government. As the economist Mariana Mazzucato has shown, nearly every major innovation since the second world war has required a big push from the public sector, for an obvious reason: the public sector can afford to take risks that the private sector can’t.
Conventional wisdom says that market forces foster innovation. In fact, it’s the government’s insulation from market forces that has historically made it such a successful innovator. It doesn’t have to compete, and it’s not at the mercy of investors demanding a share of its profits. It’s also far more generous with the fruits of its scientific labor: no private company would ever be so foolish as to constantly give away innovations it has generated at enormous expense for free, but this is exactly what the government does. The dynamic should be familiar from the financial crisis: the taxpayer absorbs the risk, and the investor reaps the reward.
From energy to pharma, from the shale gas boom to lucrative lifesaving drugs, public research has everywhere laid the foundation for private profit. And the industry that produced Juicero has been an especially big beneficiary of government largesse. The advances that created what we’ve come to call tech – the development of digital computing, the invention of the internet, the formation of Silicon Valley itself – were the result of sustained and substantial government investment. Even the iPhone, that celebrated emblem of capitalist creativity, wouldn’t exist without buckets of government cash. Its core technologies, from the touch-screen display to GPS to Siri, all trace their roots to publicly funded research.
More recently, however, austerity has gutted the government’s capacity to innovate. As a share of the economy, funding for research has been falling for decades. Now it’s being cut to its lowest level as a percent of GDP in forty years. And Republicans want to see it fall even further: the budget blueprint that Trump released in March promises deep reductions in science funding.
Decades of tax cuts have also undermined innovative potential. Ironically, these cuts were sold as measures to stimulate innovation, by unleashing the dynamism of the private sector. The biggest drop in the capital gains tax came in the late 1970s, when the National Venture Capital Association successfully lobbied Congress to slash the rate in half by claiming that VCs had created the internet. This is how we got a tax code under which Warren Buffett pays a lower tax rate than his secretary.
VCs didn’t create the internet, of course – and they haven’t funded much innovation with the additional wealth they acquired from pretending they did. In fact, VCs are anti-innovation by design. They want a big payday for their partners on a short timetable, typically looking for start-ups headed for an exit – an IPO or an acquisition by a bigger company – within three to five years. This isn’t a recipe for nurturing actual breakthroughs, which require more patient financing over a longer timeframe. But it’s a good formula for producing nonsense like the Juicero, or overvalued companies that serve as lucrative vehicles for financial speculation.
What about corporations? If VCs aren’t filling the void created by the collapse of public research, neither are big companies. Few of them put significant resourcesinto basic research any more. It’s not like they don’t have the money – monopoly profits and tax evasion have enabled Apple to amass a cash pile of a quarter of a trillion dollars. But the conquest of corporate America by the financial sector ensures that cash won’t be put to productive purposes. Wall Street is more interested in extracting wealth than creating it. It would rather companies cannibalize themselves by shoveling out profits to their shareholders in the form of stock buybacks and dividends than let them invest in their capacity for growth.
As the public sector starves, the private sector grows ever more bloated and predatory. The economy becomes a mechanism for making the rich richer, and the money that might be used to finance the next internet is allocated to sports cars and superyachts. The result isn’t just fewer miraculous inventions, but substantially weaker growth. Since the 1970s, the American economy has grown far more slowly than during its mid-century golden age – and wages have flatlined. Wealth has been redistributed upwards, where it piles up wastefully while the mass of the people who created it continue their downward slide.
It’s hard to imagine a more irrational way to organize society. Capitalism prides itself on allocating resources well – if it creates inequality, its defenders argue, at least it also creates growth. Increasingly, that’s no longer the case. In its infinite wisdom, capitalism is eating itself alive. A saner system would recognize that innovation is too precious to leave to the private sector and that capitalism, like all utopian projects, works better in theory than in practice.
World-famous linguist, philosopher and political thinker Noam Chomsky has described US President Donald Trump’s ideology simply as ‘me’, adding that while it’s not fascist, it’s still “deeply authoritarian and very dangerous.”
However, there is no other option in the eyes of the people, Chomsky added in his interview to BBC.
“What is the alternative to Trump? The democrats gave up on the working class 40 years ago. It’s not their constituency, no one in the political system is. The Republicans claim to be, but they are basically their class enemy. However they can appeal to people on the basis of claims ‘We’re gonna help you economically, even when we kick you in the face’?
In his book, Chomsky branded the Republican Party as “the most dangerous organization on Earth,” and when asked to explain, he pointed out that it’s about something they refuse to admit exists.
“Trump will do damage to the world, and it’s already happening. The most significant aspect of the Trump election is not just Trump, but the whole Republican Party as they are departing from the rest of the world on climate change, a crucial issue, an existential threat,” Chomsky said.
He called the denial “an astonishing spectacle,” in which “the US, alone in the world, not only refuses to participate in efforts to deal with climate change, but is dedicated to undermining them. And it’s not just Trump – every single Republican leader is the same and it goes down to local levels.”
And US popular opinion isn’t exactly of any help, according to Chomsky.
“Roughly 40 percent of the population think it can’t be a problem, because Jesus is coming in a couple of decades.”
Isn’t Islamic State (IS, formerly ISIS/ISIL) more of a threat? It would seem so, but Chomsky isn’t sure about that.
“Is ISIS dedicated to destroy the prospects for organized human existence? What does it mean to say is Not only we’re not doing anything about climate change, but we’re trying to accelerate the race to the precipice. Doesn’t matter whether they genuinely believe it or not, if the consequence of that is, let’s use more fossil fuel, let’s refuse to subsidize developing countries, let’s eliminate regulations that reduce greenhouse gas emissions — if that’s the consequence, that’s extremely dangerous.”
“Trump’s only ideology is ‘me’, it’s not Hitler or Mussolini, but deeply authoritarian and very dangerous,” the philosopher concluded.
The process happening in the US is universal, though, and is taking place worldwide, Chomsky told BBC, due to “a massive assault on the large part of the population, an assault on democracy” which led to “not just anger, but contempt for centrist institutions.”
“A large part of the population feels that they are just not responsive to them,” and Chomsky enumerates the results of this: Trump, Brexit, Le Pen.
Nevertheless, Emmanuel Macron’s victory in the French presidential election is “by no means the end to the populism in Europe,” he said. In fact, “Macron is an example of populism, because he came from the outside, because the institutions have collapsed. The vote for him was substantially the vote against Le Pen.”
Last, but not least, Chomsky spoke out on WikiLeaks Editor-in-Chief Julian Assange, calling his persecution and threats against him to be “completely wrong.”
“What’s keeping him in prison – and in fact he is in prison [holed up in the Ecuadorian embassy in London] – is the threat that the United States will go after him. Same thing that’s keeping [security whistleblower Edward] Snowden in Russia. And he is right to worry about it and it is the threat that is wrong.”
Dutch TV documentary alleges that President Donald Trump has extensive connections to Russia’s ruling oligarchs and a history of illegal racketeering.
“Donald Trump’s business partners have included Russian oligarchs and convicted mobsters, which could make the president guilty of criminal racketeering charges,” wrote Steven Rosenfeld at AlterNet on Friday.
The 45-minute documentary was produced by Zembla TV and examines Trump’s alleged relationship with Russian mobster Felix Sater — which Trump reportedly took pains to hide from regulators.
It also looks at Trump’s arrangements with wealthy Russians that apparently allow them to move their money outside Russia and details the elaborate financial networks these families use as a “pyramid scheme for money laundering,” Rosenfeld said. “The financial trail exposed raises questions about whether Trump fired FBI Director James Comey because the FBI’s investigation of his campaign’s collusion with Russia was encroaching into Trump’s world of dark money and dubious business partners.”
Zembla promoted the documentary by saying, “For months, the FBI have been investigating Russian interference in the American presidential elections. ZEMBLA is investigating another explosive dossier concerning Trump’s involvement with the Russians: Trump’s business and personal ties to oligarchs from the former Soviet Union. Powerful billionaires suspected of money laundering and fraud, and of having contacts in Moscow and with the mafia. What do these relationships say about Trump and why does he deny them? How compromising are these dubious business relationships for the 45th president of the United States? And are there connections with the Netherlands? ZEMBLA meets with one of Trump’s controversial cronies and speaks with a former CIA agent, fraud investigators, attorneys, and an American senator among others.”
Zembla has also released Part Two of the series, “The King of Diamonds,” which explores Trump’s relationship with Israeli billionaire Lev Leviev, who is suspected of trading in blood diamonds.
Watch the English language version of “The Dubious Friends of Donald Trump,” embedded below:
Noam Chomsky is pretty baffled by more than half of Americans; the amount of U.S. residents who will use Facebook this year. Chomsky is in the minority. He doesn’t use social media and detests when users refer to acquaintances they have the most minute exchanges with as “friends.”
“Adolescents,” Chomsky clarified, “Who think they have 500 friends, ‘cause they have 500 people on their Facebook account, but these are the kind of friends whose relation to you is if you say, ‘I bought a sandwich,’ they say, ‘did it taste good?’ That’s a kind of interaction, but very different from having a real friend.’”
Chomsky may be 87 years old, but he’s been working in the field of computer science at MIT since the 1950’s. And though he’s been retired for over a decade, it doesn’t stop new generations from contacting him – and soon afterwards, getting frustrated.
“I get a ton of correspondence, mostly email,” Chomsky said. “I’ll often get questions from high school students saying, ‘I have to write a paper Thursday on the French Revolution,’ or whatever it may be. I tell them, ‘Well here’s somebody you could look up. And the next question routinely comes back, ‘How can I find it on the internet.’ And sometimes these come from prep schools – places with good libraries, educated students privileged students, I say, ‘Well walk across the street to the school library and look it up.'”
Not a tough request, right?
“‘I don’t have time,’ they say. ‘I want to be able to get it instantly on the internet and not have to think about it,”” Chomsky relayed.
But, as laughable as it is, who in America hasn’t felt that way before?
“I’m not offering this a a critique of the internet, but there’s a lot of factors involved,” Chomsky explained.
Haymarket Books is proud to present the Noam Chomsky Collection. The collection includes some of Chomsky’s most important writings, including:
Rogue States The Washington Connection and Third World Fascism On Power and Ideology After the Cataclysm The Fateful Triangle Year 501 Turning the Tide Pirates and Emperors, Old and New Propaganda and the Public Mind Rethinking Camelot Culture of Terrorism Powers and Prospects