More on disaster capitalism

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Sunday, Sep 16, 2007

Harper’s has an excerpt from Naomi Klein’s new book, which I mentioned in a post a few days ago. I was a little skeptical about it having read only summaries, but this excerpt helps bring the argument into better focus: Klein uses the Green Zone in Iraq as an example of what the U.S. could become if the mania for privatizing all government services would be allowed to continue unabated. In walled, heavily guarded communities, the privileged would continue their lives of comfort while outside the walls would be a reversion to a primitive struggle for basic resources, for the chance at survival itself. The idea of a functioning state that unifies the different classes and factions in a society with equal rights and a basic level of public services is rejected; in Iraq, it appears absolutely impossible. This appears to have been by design; in the immediate aftermath of the invasion, as has often been noted, the Bush administration sent a bunch of flunkies picked for their ideological commitment to administer an experiment in free market anti-government, privatizing services and dismantling existing state institutions, and helping bring forth the conditions that have produced the current quagmire. Klein’s point in the article is that the same free marketeers would like to introduce the program in America, using privatization as a rallying cry in times of crisis to make the well-off think to themselves, Why should I share in the general suffering? Should this society be set up so that my money will protect me from all misery and discomfort? Otherwise what good is my money? And if those poor people feel “left behind,” then, well, they should have thought of that when they decided to be born poor and then not work extra hard to overcome that disadvantage to get enough money to safeguard themselves.


This is a fundamental divide between American conservatives and liberals: conservatives want to conserve privilege and prevent the state from alleviating inequalities (otherwise we’ll have “moral hazard” and “perverse incentives” and the poor won’t bother to work very hard to change their condition); liberals believe that civil unrest is mitigated and the better side of human nature expressed by using the state to help provide equal opportunity and a basic level of security to all citizens. That means making a certain amount of sacrifice for an intangible benefit, and it means irrational decision making at the margins, but that’s because the return on the investment is not readily measurable by the economic tools the champions of market forces tend to prefer. One can imagine the same ideological divide applying to the health care crisis America faces regarding supplying a basic level fo care for all: Prices are going up and insurance companies won’t cover those likely to be sick (or unemployed,a rough proxy for health) and this amounts to a de facto form of rationing. Conservatives play to the upper-middle-class’s fears and selfishness: You know there will be rationing, they intimate, so why not rig the system so your wealth guarantees you preferential treatment. And if those without suffer, well, at least it’s not your family. Why have a safety net if that means you, in your privilege, are a hair less safe? Of course the liberal answer to that regards the lack of huge disparities among society as beneficial in itself; it means less envy, less misery, less unrest, and ultimately more liberty for more people—satisfied people will generally leave each other alone and let people live and let live.

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