Katrina, 9/11 and disaster capitalism

Naomi Klein talks about how governments and corporations take advantage of floods, wars and other crises to implement "shock and awe" economics.

By Lenora Todaro

Read more: Books, New Orleans, Interviews, Iraq, Economy, Authors, Books Interviews

Photo: naomiklein.org

Naomi at work on "The Shock Doctrine" in Canada

Sept. 21, 2007 | Naomi Klein is one of North America's most lucid translators of globalization and its defects. Her book "No Logo: Taking Aim at the Brand Bullies" (2000) landed just after demonstrators in Seattle put demands for international economic justice on the front page. In "No Logo," Klein critiqued multinational corporations for creating poor labor conditions in the developing world, all to further "the brand."

Klein, a Canadian whose physician father and filmmaker mother left the United States during the Vietnam War, followed her concerns for workers' conditions to Argentina after its economic collapse in 2001. There, with her husband, Canadian journalist Avi Lewis, Klein created "The Take," a documentary about a group of autoworkers who occupy their dormant factory. After finishing her new book, "The Shock Doctrine: The Rise of Disaster Capitalism," she partnered with Mexican director Alfonso Cuarón ("Children of Men") to make a short film. (See it on today's Video Dog.) The movie, which caused a stir at the Venice Film Festival, dramatizes the arguments of the book: that disasters -- unnatural ones like military coups (Pinochet's Chile) and war (Iraq) as well as natural ones (the Asian tsunami and Hurricane Katrina) -- allow governments and multinationals to take advantage of citizen shock and swiftly impose corporate-friendly policies. The result: a wealthier elite and more-beleaguered middle and lower classes. Sri Lankan fishing villages become luxury resorts; public schools along the Gulf Coast become corporate-run "charter" schools.

Unafraid of controversy, Klein goes one step further in her new book than most progressive economists. She contends that in the aftermath of these various disasters, not only democracy but also human rights fall by the wayside -- all in the name of freedom and the free market. Klein compares economic shock therapy to the horrific experiments conducted on psychiatric patients in the mid-'50s by a CIA-sponsored Canadian doctor, in which patients were subjected to drugs, electroconvulsive therapy and sensory deprivation in an effort to replace their problem behaviors with a more compliant personality. If a personality can be remade, so, too, a nation. The film, with its stark images of ECT, excerpts from CIA torture manuals, footage of Nobel economist and shock-doctrine promoter Milton Friedman glad-handing Pinochet, Thatcher and Reagan, and images of natural disasters (the Asian tsunami, 9/11) makes her message visceral: Be informed, be shock-resistant.

Klein spoke with Salon from London, one stop on a 10-country book tour, about Bush's privatized war on terror, how free the free market is, and whether the anti-globalization movement survived 9/11.

"No Logo" and "The Shock Doctrine" each look at issues surrounding economic justice from different angles: marketing, direct action, public policy. Why are you so interested in economics?

I'm not really interested in economics; I'm interested in politics and culture. I studied philosophy and literature but forced myself to learn the language of economics later in life because I need it to understand the issues that I do care about. "No Logo" is about understanding the loss of cultural space to marketing; "The Shock Doctrine" is really about the loss of democracy at the hands of this economic program. My brother is an economist and directs a policy institute, so he hooked me up with academics and specialists.

For your research you traveled to Iraq, Sri Lanka after the tsunami, and New Orleans after the levees broke. What surprised you most?

I went on assignment for Harper's to Iraq to write about Paul Bremer imposing shock therapy in the aftermath of "shock and awe." After Sri Lanka and New Orleans I realized the story was bigger. In Iraq I was shocked by the level of resistance on the part of Iraqis to the privatization of factories. I quote one worker in my book who worked in a vegetable factory: "We will either burn it down or blow ourselves up inside it. We will not be privatized." It's a measure of just how wrong the occupation forces were that the Iraqis would be so shocked that they'd be easy to marshal from point A to point B.

In Sri Lanka I was shocked by the sight of shantytowns emerging for victims of the tsunami. I knew how much money had been raised, and there was no reconstruction going on. It was clear that these sprawling shantytowns would become permanent. They were the richest poor people in the world. The largest charitable drive in history, and the money just didn't reach them. In New Orleans the disaster was being used to finish the project of transforming the Gulf Coast into a "tax-free enterprise zone," as the Heritage Foundation called it.

In this book you talk about how certain businesses thrive after disasters like 9/11 or Hurricane Katrina. What are the most lucrative businesses?

One of the things that really struck me is how the stock market responds to hurricanes and terrorist attacks. The most significant change in recent years is that the stock market now responds favorably to terrorist attacks or narrowly averted attacks. A whole class of stocks jump -- disaster stocks, like surveillance companies. Homeland security is now a $200 billion industry.

There is a new level of integration between homeland security companies and media companies. General Electric, which owns NBC, has been in the weapons industry for some time but has become very active in the homeland security business. They recently purchased InVision, which provides bomb detection for airports. Since 9/11 InVision has received $15 billion in contracts from the Department of Homeland Security -- more such contracts than any other company. A company like that gains from the atmosphere of crisis and fear that is spread through media outlets. It's war against evil everywhere with no end. That's a war that can't be won, and you couldn't ask for a more profitable business plan. The only thing that threatens it is peace.

Next page: Did the Bush administration exploit post-9/11 chaos?