The disaster capitalists

Image: Sébastien Vincon
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By LUIZ MARQUES*

In the climate crisis with the flood catastrophe, neoliberals disguise themselves as socialists, and the demagoguery of the self-regulated market is exchanged for statism of convenience

The Shock Doctrine

Naomi Klein is an award-winning Canadian journalist, published in several languages. In The Shock Doctrine: The Rise of Disaster Capitalism (Nova Fronteira, 2008), proposes a look at the history of the “corporatist State” where globalization — codename for the free market — takes advantage of the chance of natural disasters (Sri Lanka), military coups (Chile), wars (Iraq) and acts terrorists (United States) to change economic legislation in favor of corporations in the areas of construction, health, security, tourism, etc.

Such has been the modus operandi of the system to implement “the new reason for the world”, towards an anarcho-capitalist dystopia. The shocks serve to undermine and exterminate remnants of the Welfare State, in the social imaginary and in reality.

The flood of the cradle of blues and jazz in Hurricane Katrina with 280 km of gusts and two thousand deaths, in 2005, gives rise to an emblematic article by Milton Friedman in the Wall Street Journal: “Most of the schools in New Orleans are in ruins, as are the homes of the children who studied there. The children spread across the country. It’s an opportunity to reform the educational system.” Thousands of teachers are fired. Private entrepreneurs receive the licensing of public schools, not as an urgent measure of relief from the pressures of chaos, but as a permanent reform.

“Disaster capitalists have no interest in fixing what existed. The process called 'reconstruction' completes the work of the original disaster by eliminating what remains of the public sphere and communities – then seeks to replace them with a kind of corporate New Jerusalem, before the victims regroup and claim rights to what was yours”, emphasizes Naomi Klein.

The rush of sectors, which often instigate and are not moved by social and ethnic inequities, illustrates the strategy of think tanks of oppression and exploitation: fear and disorder are the catalysts for every leap forward. Anti-statism makes volunteering an alternative to regulatory bodies to put the Washington Consensus prescriptions into practice; namely, the less State, the better.

The tripod that supports the ideology is privatization, government deregulation and fiscal adjustment to contain social spending. The judiciary and the commercial media lend themselves to operating scams, now, disguised with the approval of the legislature to gloss over the collusion of the “owners of power” and adapt tax, land, environmental laws and whatever the most voracious desires. The author, on screen, rejects those narratives in which unregulated capitalism goes hand in hand with democracy.

Between privatize or die

Naomi Klein compares an economic shock to the shock treatment of psychiatric patients and CIA prisoners at Guantánamo as an interrogation technique for the recalcitrant. Violent methods express convictions reminiscent of the Crusades in the Middle Ages. To hinder the audience of progressives in the proletariat and subproletariat, the extreme right discovers in the banner of “individual freedom” – through consumption – a selective criterion for deciding on “the society we want”, as opposed to revolutionary struggles for collective transformations. .

Individual freedom unites idealism with radicalism, in the abolition of regulations forged by Keynesianism in Europe and by national-developmentalism in the Southern Cone of Latin America: obstacles to the unbridled accumulation of greedy fortunes. Friedrich Hayek, Ludwig von Mises and the pop star from the University of Chicago Milton Friedman give an air of scientificity to the greed of the powerful. Rulers liquidate assets that are the product of public investments and knowledge, to build them and make them valuable. Everything has to pass into the hands of individuals. “Privatize or die”, says the IMF. Counterrevolutionaries feed on mathematized axioms.

According to Eduardo Galeano, ultraliberal theories gave birth to Augusto Pinochet. If, with Salvador Allende in Chile, bread, milk and transport account for 17% of the minimum wage, under the general's hands 74% of income goes to purchasing bread, no more; 45% of the population falls below the poverty line, and the richest 10% become 83% richer. Financiers, like addicts, ignore inequalities and ask for the next fix. GDP is unsatisfactory in the hyper-individualist saga. The purification carried out with orthodoxy is an invitation to the abyss of unhappiness: broad, general and unrestricted.

Argentina, Uruguay and Brazil that shone in terms of egalitarianization plans, like João Goulart's “basic reforms”, give way to the nightmare of a capitalism filtered through the lens of laissez-faire. In Argentina, the dictatorship came to power with a foreign debt of 7,9 billion dollars, and was expelled from the Casa Rosada with a deficit of 45 billion. In Uruguay, the military junta increases the debt from half a billion dollars to 5 billion. In Brazil, liabilities jumped from 3 billion dollars to 103 billion in 1985. This is the balance of the experience that took neoliberalism out of the library to shape it in politics.

The era of discontinuities

Naomi Klein lists examples from several countries (Bolivia, Poland, China, South Africa, Russia, USA) to explain the principle of the shock doctrine. Appropriations combine technocratic planning with the cowardly repression of subordinates. Not infrequently, order is imposed by force by official agents. Neoliberal remedies are unpopular. The ultimate objective is to pulverize the emancipatory notion of the State's institutional solidarity in relation to individuals, creditors of rights. It also breaks personal solidarity and loyalty between workers who have become competitors, with the relaxation of civilizing values ​​and dignity. Monetarism hides tricks up its sleeve.

Joseph Stiglitz sums up the mentality of shock manufacturers: “Only action-style Blitzkrieg the window of opportunity, provided in the fog of transition, makes it possible to make changes before the population organizes itself to protect its interests”. The multinationals that colonize the “savage nations” see state assets as terrain to conquer – post offices, airports, ports, roads, schools, banks, electricity, water, gas, oil, social security, national parks, civil defense and even war – in any public corner of colonized federative bodies.

According to Italian journalist Benedetto Vecchio, the Kleinian approach focuses attention on the “discontinuity” of the trajectory of capitalism in the 20th century, as opposed to the celebrated continuity in the thirty glorious years of the welfare state. The tragedy fills the unemployment statistics and, with sad reports, Psi offices. The curious thing is that the failure of the system becomes CASE​ of success in the balance of sorcerer's apprentices. “Parallel reality” is inspired by Société du Mont Pèlerin.

The beast of neoliberalism sometimes plunges into corruption and sometimes into authoritarianism, always threatening the institutions of democracy with the tentacles of the discretionary regime – aporophobia, racism and immemorial injustices. The corporatist and financialized State has attributions monetized by a trust of business that circulates between surplus value and public positions, without conflict of interests. The spurious plot renews the instability of social relations and the breakdown of sociability. Human beings are treated as commercial units and immediately labeled as either citizens or sub-citizens. This is the political culture to transcend with the mobilization of optimism, in the streets.

No to opportunism this time

The leader of Federasul (Federation of Business Entities of Rio Grande do Sul) underestimates the 15 billion in credits released by the federal government to large companies, with symbolic interest of 1% per year. In an interview, the business leader recognizes the paternalistic affection, but still minimizes the amount raised. “Expectations were higher.” In the climate crisis with the flood catastrophe, neoliberals disguise themselves as socialists.

They ask that the Treasury pour money into society and, at the same time, be a friendly buyer of the services it finances. On occasions, the demagoguery of the self-regulated market is exchanged for statism of convenience. The question is how the contributions from the treasury will be applied. Solidarity must have a truly community character and without deviations.

It is no surprise that the government of Rio Grande do Sul recently created an Extraordinary Secretariat for the reconstruction and redefinition of fiscal rules, which has among its functions the contracting of infrastructure works and the monitoring of concession contracts, with resources coming from Brasília. Nor is it surprising that the secretary, recently appointed by the Tucano governor, wants to quickly implement the privatization of highways and two thousand public schools in Guasca territory, with the euphemistic Public-Private Partnerships (PPPs).

Someone needs to warn the sailor that the aid is not for navigating the mud of privatism. It is to qualify the lives of survivors of the cataclysm, enhanced by participatory planning. The specter of New Orleans hangs over Brazil's heels.

It's not worth imitating the lapwing and singing far from the nest. If there was no nod from the PT president to direct negotiations between companies and employees, to reduce salaries and rearrange vacations, this reveals that the anti-laborism of coup leader Temer and fascist Bolsonaro is a turning point on the Brazilian horizon. Yesterday the workers' opinion was disregarded. The bosses had the tone of exclusivity, in the voice of command and obedience. Today the CUT and all social movements need to be heard, which is not a favor; It is common sense in democratic environments. It is up to the Republic to demonstrate imagination so as not to trip over its own legs. Calm down at this time.

The Chief Minister of the Civil House Rui Costa verbalizes the Union's intention to manage and maintain all flood protection structures, starting with the Muro da Mauá, dikes and pump houses in Porto Alegre. The Union modernizes the apparatus and transfers the responsibility of city halls in the metropolitan region to the state administration, through a public body. Lula's governance proposal solves the structural problem.

The news is out. Demystifies the pseudo virtues of the market and increases control over res publica. For more information, see the report by Gabriela Moncau – “Alvarez & Marsal, McKinsey and EY: disaster capitalism takes the lead in reconstruction in RS” (in: Brazil of Fact, 31/05/24). – No to opportunism, this time!

* Luiz Marques is a professor of political science at UFRGS. He was Rio Grande do Sul's state secretary of culture in the Olívio Dutra government.

Originally published in the magazine Theory and Debate, No. 245.


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