Disaster Capitalism

Disaster Capitalism: The new economy of catastrophe
by Naomi Klein
PUBLISHED September 8, 2007

This article is a preprint for subscribers. Itwill appear in the October 2007 Harper's Magazine.

This is astounding information and observation, though, when we think about it, not in the least surprising, confirming what we already know, have witnessed, and tragically, some of us have already experienced personally.

It goes along with the current loud touting of climate change capitalism, and how the market is going to deal with it. Yay! for the ice caps melting and the new sea passages! So good for the economy.

Ms. Klein's article, based on her book, is far too long to post all of it here, even though it's not yet available for online reading. But here are a few pulled paragraphs (if one would like to see the entire article, let me know via e-mail):

[ Everywhere in Iraq, the wildly divergent values assigned to different categories of people are on crude display. Westerners and their Iraqi colleagues have checkpoints at the entrances to their streets, blast walls in front of their houses, body armor, and private security guards on call at all hours. They travel the country in menacing armored convoys, with mercenaries pointing guns out the windows as they follow their prime directive to "protect the principal." With every move they broadcast the same unapologetic message: We are the chosen, our lives are infinitely more precious than yours. Middle-class Iraqis, meanwhile, cling to the next rung down the ladder: they can afford to buy protection from local militias, they are able to ransom a family member held by kidnappers, they may ultimately escape to a life of poverty in Jordan. But the vast majority of Iraqis have no protection at all. They walk the streets exposed to any possible ravaging, with nothing between them and the next car bomb but a thin layer of fabric. In Iraq, the lucky get Kevlar; the rest get prayer beads.

Like most people, I saw the divide between Baghdad's Green and Red zones as a simple by-product of the war: This is what happens when the richestcountry in the world sets up camp in one of the poorest. But now, after years spent visiting other disaster zones, from post-tsunami Sri Lanka to post-Katrina New Orleans, I've come to think of these Green Zone/Red Zone worlds as something else: fast-forward versions of what "free market" forces are doing to our societies even in the absence of war. In Iraq the phones, pipes, and roads had been destroyed by weapons and trade embargoes. In many other parts of the world, including the United States, they have been demolished by ideology, the war on "big government," the religion of tax cuts, the fetish for privatization. When that crumbling infrastructure is blasted with increasingly intense weather, the effects can be as devastating as war. ]

[ "Neglected Defense: Mobilizing the Private Sector to Support HomelandSecurity," a 2006 report whose advisory committee included some of thelargest corporations in the sector, warned that "the compassionate federalimpulse to provide emergency assistance to the victims of disasters affectsthe market's approach to managing its exposure to risk." Published by theCouncil on Foreign Relations, the report argued that if people know the government will come to the rescue, they have no incentive to pay forprotection. In a similar vein, a year after Katrina, CEOs from thirty of thelargest corporations in the United States joined together under the umbrellaof the Business Roundtable, which includes in its membership Fluor, Bechtel,and Chevron. The group, calling itself Partnership for Disaster Response,complained of "mission creep" by the nonprofit sector in the aftermath ofdisasters. The mercenary firms, meanwhile, have been loudly claiming that they are better equipped than the U.N. to engage in peacekeeping in Darfur.

Much of this new aggressiveness flows from suspicion that the golden era of bottomless federal contracts might not last much longer. The U.S. governmentis barreling toward an economic crisis, thanks in no small part to thedeficit spending that has bankrolled the privatized disaster economy. Sooner rather than later, the contracts are likely to dip significantly. In late 2006 defense analysts began predicting that the Pentagon's acquisitionsbudget could shrink by as much as 25 percent in the coming decade.

When the disaster bubble bursts, firms such as Bechtel, Fluor, andBlackwater will lose much of their primary revenue streams. They will still have all the high-tech equipment bought at taxpayer expense, but they will need to find a new business model, a new way to cover their high costs. The next phase of the disaster-capitalism complex is all too clear: with emergencies on the rise, government no longer able to foot the bill, and citizens stranded by their hollow state, the parallel corporate state will rent back its disaster infrastructure to whoever can afford it, at whatever price the market will bear. For sale will be everything from helicopter rides off rooftops to drinking water to beds in shelters.

Wealth already provides an escape hatch from most disasters-it buysearly-warning systems for tsunami-prone regions and stockpiles of Tamiflu for the next outbreak. It buys bottled water, generators, satellite phones,and rent-a-cops. During the Israeli attack on Lebanon in 2006, the U.S. government initially tried to charge American citizens for the cost of their own evacuation, though it was eventually forced to back down. If we continuein this direction, the images of people stranded on New Orleans rooftops will not only have been a glimpse of America's unresolved past of racia linequality but will also have foreshadowed a collective future of disaster apartheid, in which survival is determined primarily by one's ability to pay.

Perhaps part of the reason so many of our elites, both political and corporate, are so sanguine about climate change is that they are confident they will be able to buy their way out of the worst of it. This may alsopartially explain why so many Bush supporters are Christian end-timers. It's not just that they need to believe there is an escape hatch from the worldthey are creating. It's that the Rapture is a parable for what they arebuilding down here on Earth-a system that invites destruction and disaster,then swoops in with private helicopters and airlifts them and their friendsto divine safety. ]

There is much, much, much more. She's speaking at the NYPL Humanties Research Library next week; it's already sold out.