The Shock Doctrine: The Rise of Disaster Capitalism by Naomi Klein

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The bestselling author of No Logo shows how the global free market has exploited crises and shock for three decades, from Chile to Iraq In her groundbreaking reporting over the past few years, Naomi Klein introduced the term disaster capitalism. Whether covering Baghdad after the U.S.... read more

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Milton Friedman: Godfather character of the push for free market economics.
Jeffrey Sachs: Add a description of this character.
Boris Yeltsin
Augusto Pinochet: Dictator in Chile that used extreme suppression to push through a free market agenda that led to both extreme poverty and extreme concentrated wealth in Chile.
Donald Rumsfeld
Suharto
Mandela
George W. Bush
Dick Cheney
Allende
Gorbachev
Gail Kastner
Walsh
Ewen Cameron: Scientists who experimented with several behavior modification procedures including shock therapy.
Paz
Keynes
Saddam
Thatcher
Paul Bremer
Goni
Walesa
Mbeki
James Baker
Henry Kissinger
Hebb
Katrina
Ronald Reagan
Clinton
Fukuyama
Menem
Arnold Harberger
Budhoo
Williamson
Hayek
Perle
Padayachee
Shultz
Muslim

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“The average Russian consumed 40 percent less in 1992 than in 1991, and a third of the population fell below the poverty line”
“Democratic socialism, meaning not only socialist parties brought to power through elections but also democratically run workplaces and land holdings, has worked in many regions, from Scandinavia to the thriving and historic cooperative economy in Italy's Emilia-Romagna region”
“And that is the post-September 11 difference: before, wars and disasters provided opportunities for a narrow sector of the economy--the makers of fighter jets, for instance, or the construction companies that rebuilt bombed-out bridges. The primary economic role of wars, however, was as a means to open new markets that had been sealed off and to generate postwar peacetime booms. Now wars and disaster responses are so fully privatized that they are themselves the new market; there is no need to wait until after the war for the boom--the medium is the message.”
“All these incarnations share a commitment to the policy trinity--the elimination of the public sphere, total liberation for corporations and skeletal social spending--but none of the various names for the ideology seem quite adequate. Friedman framed his movement as an attempt to free the market from the state, but the real-world track record of what happens when his purist vision is realized is rather different. In every country where Chicago School policies have been applied over the past three decades, what has emerged is a powerful ruling alliance between a few very large corporations and a class of mostly wealthy politicians--with hazy and ever-shifting lines between the two groups.”
“But what of the contemporary crusade to liberate world markets? The coups, wars and slaughters to install and maintain pro-corporate regimes have never been treated as capitalist crimes but have instead been written off as the excesses of overzealous dictators, as hot fronts of the Cold War, and now of the War on Terror. If the most committed opponents of the corporatist economic model are systematically eliminated, whether in Argentina in the seventies or in Iraq today, that suppression is explained as part of the dirty fight against Communism or terrorism--almost never as the fight for the advancement of pure capitalism.”
“Like all fundamentalist faiths, Chicago School economics is, for its true believers, a closed loop. The starting premise is that the free market is a perfect scientific system, one in which individuals, acting on their own self-interested desires, create the maximum benefits for all. It follows ineluctably that if something is wrong within a free-market economy--high inflation or soaring unemployment--it has to be because the market is not truly free. There must be some interference, some distortion in the system. The Chicago solution is always the same: a stricter and more complete application of the fundamentals.”
“It all came back to Friedman's single-minded message: everything went wrong with the New Deal. That's when so many countries "including my own, got off on the wrong track." To get governments back on the right track, Friedman, in his first popular book, "Capitalism and Freedom," laid out what would become the global free-market rulebook and, in the U.S., would form the economic agenda of the neoconservative movement.”
“Undeterred, Pinochet's economic team went into more experimental territory, introducing Friedman's most vanguard policies: the public school system was replaced by vouchers and charter schools, health care became pay-as-you-go, and kindergartens and cemeteries were privatized. Most radical of all, they privatized Chile's social security system.”
“In Chile, if you were outside the wealth bubble, the miracle looked like the Great Depression, but inside its airtight cocoon the profits flowed so free and fast that the easy wealth made possible by shock therapy-style "reforms" have been the crack cocaine of financial markets ever since. And that is why the financial world did not respond to the obvious contradictions of the Chile experiment by reassessing the basic assumptions of laissez-faire. Instead, it reacted with the junkie's logic: Where is the next fix?”
“Sergio de Castro, Pinochet's Chicago Boy economics minister who oversaw the implementation of shock treatment, said he could never have done it without Pinochet's iron fist backing him up. "Public opinion was very much against <us>, so we needed a strong personality to maintain the policy. It was our luck that President Pinochet understood and had the character to withstand criticism." He has also observed that an "authoritarian government" is best suited to safeguarding economic freedom because of its "impersonal" use of power.”
“The Argentine junta's foreign minister, Cesar Augusto Guzzetti, said that "when the social body of the country has been contaminated by a disease that corrodes its entrails, it forms antibodies. These antibodies cannot be considered in the same way as the microbes. As the government controls and destroys the guerrilla, the action of the antibody will disappear, as is already happening. It is only a natural reaction to a sick body." This language is, of course, the same intellectual construct that allowed the Nazis to argue that by killing "diseased" members of society they were healing the "national body."”
“For Hayek and the movement he represented, it was a disappointing assessment. The Southern Cone's experiment had generated such spectacular profits, albeit for a small number of players, that there was tremendous appetite from increasingly global multinationals for new frontiers--and not just in developing countries but in rich ones in the West too, where states controlled even more lucrative assets that could be run as for-profit interests: phones, airlines, television airwaves, power companies. If anyone could have championed this agenda in the wealthy world, it would surely have been either Thatcher in England or the American president at the time, Ronald Reagan.”
“In testimony from truth commission reports across the region, prisoners tell of a system designed to force them to betray the principle most integral to their sense of self.... but many prisoners report that their torturers were far less interested in the information, which they usually already possessed, than in achieving the act of betrayal itself. The point of the exercise was getting prisoners to do irreparable damage to that part of themselves that believed in helping others above all else, that part of themselves that made them activists, replacing it with shame and humiliation.”

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A more accurate term for a system that erases the boundaries between Big Government and Big Business is not liberal, conservative or capitalist but corporatist. Its main characteristics are huge transfers of public wealth to private hands, often accompanied by exploding debt, an ever-widening chasm between the dazzling rich and the disposable poor and an aggressive nationalism that justifies bottomless spending on security.
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First, governments must remove all rules and regulations standing in the way of the accumulation of profits. Second, they should sell off any assets they own that corporations could be running at a profit. And third, they should dramatically cut back funding of social programs.
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Crises are, in a way, democracy-free zones—gaps in politics as usual when the need for consent and consensus do not seem to apply.
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The three trademark demands—privatization, government deregulation and deep cuts to social spending—tended
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I call these orchestrated raids on the public sphere in the wake of catastrophic events, combined with the treatment of disasters as exciting market opportunities, “disaster capitalism.”
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Far from freeing the market from the state, these political and corporate elites have simply merged, trading favors to secure the right to appropriate precious resources previously held in the public domain—from Russia’s oil fields, to China’s collective lands, to the no-bid reconstruction contracts for work in Iraq.
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The primary economic role of wars, however, was as a means to open new markets that had been sealed off and to generate postwar peacetime booms. Now wars and disaster responses are so fully privatized that they are themselves the new market; there is no need to wait until after the war for the boom—the medium is the message.
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The bottom line is that while Friedman’s economic model is capable of being partially imposed under democracy, authoritarian conditions are required for the implementation of its true vision.
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in moments of crisis, people are willing to hand over a great deal of power to anyone who claims to have a magic cure—whether the crisis is a financial meltdown or, as the Bush administration would later show, a terrorist attack.
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The enormous benefit of having corporate views funneled through academic, or quasi-academic, institutions not only kept the Chicago School flush with donations but, in short order, spawned the global network of right-wing think tanks that would churn out the counterrevolution’s foot soldiers worldwide.
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I met Jamar Perry in September 2005, at the big Red Cross shelter in Baton Rouge, Louisiana.

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INTRODUCTION
Blank is Beautiful: Three Decades of Erasing and Remaking the World

PART 1
Two Doctor Shocks: Research and Development

1. The Torture Lab: Ewen Cameron, the CIA and the Maniacal Quest to Erase and Remake the Human Mind
2. The Other Doctor Shock: Milton Friedman and the Search for a Laissez-Faire Laboratory

PART 2
The First Test: Birth Pangs

3. States of Shock: The Bloody Birth of the Counterrevolution
4. Cleaning the Slate: Terror Does Its Work
5. "Entirely Unrelated": How an Ideology Was Cleansed of Its Crimes

PART 3
Surviving Democracy: Bombs Made of Laws

6. Saved by a War: Thatcherism and Its Useful Enemies
7. The New Doctor Shock: Economic Warfare Replaces Dictatorship
8. Crisis Works: The Packaging of Shock Therapy

PART 4
Lost in Transition: While We Wept, While We Trembled, While We Danced

9. Slamming the Door on History: A Crisis in Poland, a Massacre in China
10. Democracy Born in Chains: South Africa's Constricted Freedom
11. Bonfire of a Young Democracy: Russia Chooses "The Pinochet Option"
12. The Capitalist Id: Russia and the New Era of the Boor Market
13. Let It Burn: The Looting of Asia and "The Fall of a Second Berlin Wall"

PART 5
Shocking Times: The Rise of the Disaster Capitalism Complex

14. Shock Therapy in the U.S.A.: The Homeland Security Bubble
15. A Corporatist State: Removing the Revolving Door, Putting in an Archway

PART 6
Iraq, Full Circle: Overshock

16. Erasing Iraq: In Search of a "Model" for the Middle East
17. Ideological Blowback: A Very Capitalist Disaster
18. Full Circle: From Blank Slate to Scorched Earth

PART 7
The Movable Green Zone: Buffer Zones and Blast Walls

19. Blanking the Beach: "The Second Tsunami"
20. Disaster Apartheid: A World of Green Zones and Red Zones
21. Losing the Peace Incentive: Israel as Warning

CONCLUSION
Shock Wears Off: The Rise of People's Reconstruction

Notes
Acknowledgements
Index