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Shocking the people into submission

Written By: - Date published: 10:10 am, May 29th, 2013 - 23 comments
Categories: class war, democracy under attack, economy, human rights, International, john key, poverty, privatisation, same old national, slippery, spin, workers' rights - Tags: ,

The documentary The Shock Doctrine (2009)aired on Maori TV last night.   It is based on Naomi Klein’s book of the same name.  This presents a convincing and well-supported argument of the way “neoliberal” have been imposed on countries since the 1980s by capitalising on a range of natural and human-induced disasters and economic shocks.  She exposes the hypocrisy of the the Chicago School-based, “neoliberal” theory compared with the practice.  Milton Friedman’s theory claims that with economic liberalisation will come a more democratic and socially liberal society.

It is extremely important  to understand the way disasters, wars and economic shocks are used by the wealthy and powerful right wingers to further many of their policies. However, it is important to note that, this is not part of a carefully orchestrated, well-cordinated plan.  Rather, it shows how those with a mix of economic, financial and political power opportunistically capitalise on unexpected shocks, while focusing on their own self-serving interests.

As graphically shown in the documentary, the first attempts at imposing the Chicago School model was through the dictatorial regimes in Pinochet’s Chile and Argentina in the 1970s- brutal, murderous regimes that accepted no opposition, especially from the left.  The documentary is compelling viewing, using the style and format of Hollywood movies, with the sights and sounds of graphic explosions in war zones, and devastating images of the poverty that resulted from the “neoliberal” revolution.

And here lies the dilemma with an otherwise excellent documentary: it presents an important argument and evidence in a way that might likely get the attention of many beyond those already opposed to “neoliberal” capitalism.  However, it does tend to treat the “shock doctrine” as a carefully planned, well0orchestrated campaign, following a neatly unfolding narrative.

It is important to learn from the way shocks are opportunistically manipulated within the broader global setting.  Naomi Klein’s Shock Doctrine needs to be read in conjunction with David Harvey’s Brief History of Neoliberalism.  Harvey shows how there are massive inconsistencies with the way “neoliberal” policies are put into practice.  When necessary, the elites will use anti-democratic means, and practice market protectionist strategies that are anything but “free”.  The main thing that is consistent within “neoliberal” regimes, is that the wealth is shifted from the majority (including those with least power and wealth), to the few (most of whom are already pretty well off).

Throughout the Shock Doctrine documentary we see excerpts of speeches and comments from Naomi Klein, explaining how the doctrine works.  Klein’s most important statements come towards the end of the documentary, after it has traced the trail of shocks from Chile through Bush Jnr’s “war on terror”, to the shock of the 2008 Global Financial Crisis.  Of the GFC Klein says (in the segment that begins around 1 hour 11 minutes), in spite of the rhetoric of taming the big banks:

We are witnessing a transfer of wealth of unfathomable size.  It is a transfer of wealth from the public hands, from the hands of government collected from regular people in the form of taxes, into the hands of the wealthiest corporations and individuals in the world.  Needless to say the very individuals and corporations that created this crisis.

The documentary ends on a positive note.  Klein says that the shock doctrine depends on people not being aware of what is happening.   It works only because the people are immobilised, confused and disoriented by the chaos and impact of the shocks.  If people are aware of what is happening, they can resist. Along with this suggestion, I’d also look to David Harvey’s book which shows the imperfections, failures and inconsistencies of the “neoliberal” revolution.  “Neoliberalism” succeeds because the elites are single-mindedly focused on their aims, even if they don’t all agree on the means.

A week or so ago, I also felt somewhat immobilsed by the Key government’s latest blitzkrieg.  They seemed to be launching one attack after another on our democratic processes.  It was hard to know where to focus opposition.  Now they and their MSM cheer team are focusing on the (alleged) positives of the direction the country is taking us.  For instance, Tracy Watkins, while putting the boot into David Shearer’s leadership, claims:

The poll shows a sudden surge in people who think the country is on the right track – a combination of the wealth effect of a rise in house prices, particularly in Auckland, a drop in the number of jobless, better growth figures and a feeling that there is light at the end of the tunnel for the economy.

There are plenty of niggles with the Government but they are just that – niggles.

None has taken on the tsunami-like proportions of the nanny state backlash that swept Labour out of office.

And with optimism on the rebound, National’s message at the election in 2014 looks like an increasingly potent one – we’ve taken our medicine, done the hard yards, and we’re starting to reap the gains. Why put that all at risk?

However, such triumphalism ignores what has happened as a result of the NAct government’s relentless anti-democratic shocks.  Michael Field, also on Stuff this morning, reports on the rising inequalities in NZ:

New Zealanders might believe they live in an egalitarian nation but a worldwide “better life index” shows the quality of life here is being significantly harmed by the gap between the richest and poorest. ..

New Zealand’s average household net-adjusted disposable income is US$21,892 a year (NZ$27,077.34), less than the OECD average of US$23,047.

“But there is a considerable gap between the richest and poorest – the top 20 per cent of the population earn five times as much as the bottom 20 per cent,” the report says.

People in New Zealand work slightly less than the OECD average while 13 per cent of employees “work very long hours”, more than the OECD average of 9 per cent.

Focusing on the broad employment statistics can be misleading.  What good is higher employment and less unemployment, if more jobs pay less than a living wage?  In its attacks on workers’ and beneficiaries’ rights, this government has been doing a good job of helping to shift the wealth upwards, and strengthening the power of the corporates, while weakening the power and finances of those on low incomes.

23 comments on “Shocking the people into submission”

  1. New Zealand’s average household net-adjusted disposable income is US$21,892 a year (NZ$27,077.34), less than the OECD average of US$23,047.

    International Monetary Fund (2012)

    […] 5 Australia 67,723 2012[…]
    14 Netherlands 46,142 2012
    15 Finland 46,098 2012
    16 Ireland 45,888 2012
    17 Kuwait 45,824 2012
    18 Belgium 43,686 2012
    19 Iceland 41,740 2012
    20 Brunei 41,703 2012
    21 Germany 41,513 2012
    22 France 41,141 2012
    23 United Kingdom 38,589 2012
    24 New Zealand 38,222 2012
    — Hong Kong 36,667 2012
    25 Italy 33,115 2012
    — European Union 32,518 2012
    26 Israel 31,296 2012
    27 Spain 29,289 2012[…]

    http://en.wikipedia.org/wiki/List_of_countries_by_GDP_%28nominal%29_per_capita
    Despite the ‘financial crisis’ the government is still failing on the GDP front, so much for ending the income gap with Australia.

  2. Tim 2

    “And here lies the dilemma with an otherwise excellent documentary: it presents an important argument and evidence in a way that might likely get the attention of many beyond those already opposed to “neoliberal” capitalism.”

    If I recall, from the credits, it was made in 2009 – not too long after the 2008 ‘GFC’. I’m hoping that the consequences of the neo-liberal programme will have become a part of many more people’s life experience (i.e. they’ll have become more directly affected).

    • Tim 2.1

      I tried to edit – I see you’d already included the 2009 release date: read from the “I’m hoping….”

  3. johnm 3

    The current Neoliberal order has a horror of democracy and even the mixed economy. http://en.wikipedia.org/wiki/Mixed_economy

    We have The Corporate Welfare State http://www.monbiot.com/2011/11/21/the-corporate-welfare-state/

    ” areas forced to kneel before the dictates of the marketplace—to show what happens when unfettered corporate capitalism and ceaseless economic expansion no longer have external impediments. We wanted to illustrate what unrestrained corporate exploitation does to families, communities and the natural world. We wanted to challenge the reigning ideology of globalization and laissez-faire capitalism to illustrate what life becomes when human beings and the ecosystem are ruthlessly turned into commodities to exploit until exhaustion or collapse. And we wanted to expose as impotent the formal liberal and governmental institutions that once made reform possible, institutions no longer equipped with enough authority to check the assault of corporate power. ” http://www.truthdig.com/report/item/rise_up_or_die_20130519/

    We have two headed one party state.

    This subject is so big it’s hard to know where to begin. The invasion of Iraq and its prior siege to starve it out and the lies to justify the invasion are epic war crimes on a parallel with Nazi Germany and Japanese war crimes worthy of another Nuremburg trial.

    basically the rich and wealthy and the banks and corporations have a total abhorrence of democracy and the lumpen proles having any effective voice. Profit is the new tyranny.

    • johnm 3.1

      All the Privatisations are day light robbery from the common good of the people. The presstitute media comply with the dumbing down of the public most of whom now wouldn’t have a clue what the term “common good” means or that it’s the foundation of any decent society and that the term includes the natural world as well–no deep sea oil drilling. We have a wealth worship growth sickness that even the Planet itself is rebelling against in the form of climate change that could eventually be the demise of most of us.

      • Draco T Bastard 3.1.1

        We have a wealth worship growth sickness that even the Planet itself is rebelling against in the form of climate change that could eventually be the demise of most of us.

        Yep and the way things are going it looks like we’re not going to learn that lesson until after the planet’s crushed our “civilisation”.

      • johnm 3.1.2

        On a lighter note here is an example of a shocking doctrine closer to home: Australia:

        “Conservative billionaire Gina Rinehart called for the sterilization of the poor today, arguing that the only way to alleviate poverty is to stop the “underclasses” from multiplying.

        In a video uploaded to her official YouTube account, the Australian mining heiress said that income inequality is caused by differences in intelligence, and eugenics is the only answer.

        “Our nation faces a grave economic crisis as the combination of a strong Australian dollar and falling commodity prices sap our ability to compete globally,” she explained. “The only logical solution to this crisis is to strengthen the quality of our most precious resource: human capital.”

        Bloody ell! :-) To think our governments really do listen to people like this.

        http://dailycurrant.com/2013/05/28/gina-rinehart-calls-for-sterilization-of-the-poor/

        She resembles someone here in NZ Paula B……

        “I believe that any couple making less than $100,000 a year should be forcibly sterilized through a vasectomy or fallopian tubal ligation. Those earning more than $100,000 a year should be encouraged to have as many as 10 or 12 children.” Holy Motherf@cker!!!

        “So I’m willing to pay a decent wage, as long as I’m getting the son of a doctor and not the son of a failed bartender on welfare. The problem is that the underclasses seem to be outbreeding the intelligent folks, and I can’t find a decent worker anywhere.” What Planet She live on!? OH yes the billionaire’s planet privilege

        • Colonial Viper 3.1.2.1

          In a video uploaded to her official YouTube account, the Australian mining heiress said that income inequality is caused by differences in intelligence, and eugenics is the only answer.

          She should look in the fucking mirror before opening her mouth on eugenics again.

        • Draco T Bastard 3.1.2.2

          Everything I’ve seen of Gina Rinehart shows that she’s rather stupid. Having more of her running around is definitely what will kill this world.

          What Planet She live on!? OH yes the billionaire’s planet privilege

          Planet Key.

        • millsy 3.1.2.3

          I hope that’s satire….

          I really do.

  4. tracey 4

    Karol, if you get a chance, find a book called “from Good hands to Boxing Gloves” It outlines the impact of McKinsey on the USA’s largest insurer and how they moved from having policy holders at the centre of their business to shareholders, which saw years of higher premiums and significantly lower payouts while misleading customers as tot he extent of their coverage.

    I believe it outlines a similar modus operandi as you outline here.

    Could be important given the QBE and other insurance issues faced by Christchurch. It is likely to have implications for all kiwis as insurance companies try to claw back losses from all clients.

  5. tracey 5

    My brother often says what this country needs is a dictator. No stuffing around, decisions made action taken. He does vote National but he is no right-wing fanatic. he does constantly moan at all his wasted tax dollars… He’s no rich lister but he is very well off

    • lprent 5.1

      Dare him to say that down in Christchurch. Brownlee effectively has dictatorial powers down there. Somehow that hasn’t stopped the rebuild down there being a total clusterfuck according to *everyone* I have talked to from Christchurch over the last year. Doesn’t matter if they are left, right, or uninterested in politics – they are all freaking pissed off. Especially at Brownlee, CERA, EQC, and even the city council because bugger all of any significance to the residents has been happening despite all of the dictatorial powers.

      He could get a better idea about how useless dictatorial powers are.

    • Draco T Bastard 5.2

      The problem with benign dictators is who replaces them.

  6. saarbo 6

    Thanks Karol, well summed up…I haven’t red the book but the doco was outstanding. Big thumbs up to Maori TV.

  7. Roger Douglas articulated the ‘shock doctrine’ in NZ with his statement to the effect that ‘reforms’ had to happen fast before people woke up. The urgency and ruthlessness which which the ruling class implemented their reforms at the time was not part of a conscious conspiracy, it flowed from the crisis of capital that broke out in the 1970s. This was caused by a fall in the rate of profit resulting from a rise in the organic composition of capital. As the cost of plant and machinery required to make labour more productive increased as a ratio of labour employed, labour had to generate higher profits to cover the total capital investment. This meant that the rate of exploitation needed to increase. At a certain point in the late 60’s, that rate (the willingness of workers to work harder or face cuts in living standards) could not keep pace with total capital invested, and profits began to fall. This is well documented, not only by Marxists. Capitalism needed to be restructured. So whatever the means used the ends were the same. Capital had to drive down its costs to restore its profits. In NZ this meant that industry had to be restructuring to cut costs and become internationally competitive. Rogernomics was the Labour Party’s answer. It was economic kiwi shock therapy.
    This was captured at the time by the Socialist Alliance in their “Rogercomic”. https://www.facebook.com/media/set/?set=a.1949769616850.2100256.1020893687&type=3
    The best account of the underlying forces at play is in the late Geoff Pearce’s PhD “Where is NZ Going”. http://ir.canterbury.ac.nz/handle/10092/1024
    Brian Roper has summarised and updated this analysis in ‘State and Economy in NZ’ which as far as I know is not online.

    • Ennui 7.1

      Red, I had a quiet laugh clicking on your site and seeing Trotsky…..seemed very ironic considering that you quote Rogers statement to the effect that ‘reforms’ had to happen fast before people woke up”.

      This is directly out of the Lenin school of revolutionary practice, probably his greatest contribution to turning theory into reality. It amuses me that what was pioneered by the Reds got appropriated by the Neo Libs….not surprising that these two are mirror images, both practitioners of “rationalism” and “materialism”.

      Your guys should never have publicised the methodology nor proven it. Funny also your analysis of capital in crisis, looks very much like a rerun of what brought the Soviet Union to its knees to me.

    • Draco T Bastard 7.2

      Not online but in libraries.

  8. Paul 8

    Naomi Klein could easily use Christchuch as an example for her book.
    Earthquake, dodgy insurance companies, forced school changes, people living in broken houses for over 2 years, charter schools, removal of democracy with Ecan..
    Yup, that’s shock doctrine in action.

  9. TheContrarian 9

    Would have liked to have seen that but The Fly was on Prime.

  10. xtasy 10

    Karol, I am in agreement with your comment that what the Nats in government have been presenting us of recent, is nothing short of policy and legislative “blitzkrieg”. Yes, bringing in unconstitutional, undemocratic, the BORA and Human Rights Act breaching laws, some under urgency, and rushing them through select committee, some even not going through that stage, that is clearly a speedy or hasty attack on the democratic process that should actually be followed, upheld and applied.

    The main problem is, most people in the public have such a dim view of politicians, and are also so superficially and poorly informed, they take little interest in details, and they do not even know that their rights and entitlements are signed away with a stroke of a pen, when these new laws and amended laws get their assent.

    We know how practically “complicit” the leaders in the mainstream media are in supporting this government, and they keep their staff (the average reporter on rushed feet, the journalist not given time and pay to research details) at a tight lead, so they do not go astray and do what they actually would be supposed to do.

    I did not see that film, and I rely on your assessment.

    With the continued “neo-liberal” onslaught, I fear the NatACT government have just started to run the bulldozer over us. Wait and see how they will implement the welfare reforms soon, it will start in harmless fashion (see the “calming” info contained in brouchures at WINZ offices), but once the regime is in place, there will be thousands thrashed off the benefits, forced to work, whether actually signed off as sick and incapacitated by doctors, or not. They will simply circumvent or override medical decisions, as they have already tried increasingly over the last two years.

    The new “assessments”, separate to medical examinations, will be so constructed, that they will find many capable to work, even if it is for non existing, hypothetical jobs. The goal is cost cutting and sending the message to others: Do not even bother applying for benefits, as you will most likely not qualify anyway.

    We are in for an onslaught, for sure, at that and other levels. It is highly dismaying, that most out there do not get it, and simply shrug their shoulders and turn away, letting all this happen.

    • Colonial Viper 10.1

      Karol, I am in agreement on your comment that what the Nats in government have been presenting us of recent, is nothing short of policy and legislative “blitzkrieg”.

      Lucky that we have our very own Red Army to defeat them. Maybe. Not.

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    2 weeks ago
  • Juking the Welfare Stats Again
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    2 weeks ago
  • OCR rate cut a result of flagging economy
    The Reserve Bank's decision to cut the Official Cash Rate to 3 per cent shows there is no encore for the so-called 'rock star' economy, says Labour's Finance Spokesperson Grant Robertson.   "Today's interest rate cut comes off the back… ...
    2 weeks ago
  • Reboot to an innovation economy, an Internet economy and a clean economy
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    GreensBy Gareth Hughes MP
    2 weeks ago
  • Bill that puts the environment into the EPA passes first hurdle
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    2 weeks ago
  • Key’s KiwiSaver deception exposed
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    2 weeks ago
  • Minimum Wage Amendment Bill to protect contractors
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    2 weeks ago
  • Bill raises bar to protect Kiwi farmland
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