How is the shock doctrine applied to New
Orleans after hurricane Katrina? To developing countries after the Asian
Tsunami? How does this demonstrate Milton Friedman’s shock doctrine?
Since the rise of the Chicago Boy’s neo-conservative
methods, shock has been used to implement free-trade decisions on societies in
many different situations. In each case, these decisions are against the will
of the general society, and are favored by wealthy people and large
corporations. Neocons have used natural disasters, terrorist attacks, wars, and
economic distresses as opportunities to implement the shock doctrine. After
such shocks occur, the society is too chaotic and focused on immediate needs to
be able to resist adverse economic decisions affecting them. This method of
using shock as a tool for gaining “free-market” advantage is based on Milton
Friedman’s disaster capitalism theories and practices. In the case of New
Orleans after hurricane Katrina, and in Southeast Asia after the Tsunami, the
shock caused by the natural disasters was used to implement shock doctrine.
New Orleans, Louisiana, is a city located in dangerous
hurricane territory. The state applied for the development of a hurricane contingency
plan in 2004, and was denied. Instead, a private company was hired that
completely failed at making any concrete preparation for hurricane disaster.
The following year the powerful Hurricane Katrina hit, which caused massive
destruction in New Orleans. The shock and crisis of this event gave
neo-conservatives the perfect opportunity for implementation of the
disparity-creating reforms they had been wanting. Some of these reforms included
the building of charter schools to replace public schools that were destroyed,
removal of corporate taxes, and suspension of wage laws. Companies including
Blackwater and Halliburton, who made significant profits on the reconstruction
of Iraq, also benefited from the disaster of Hurricane Katrina. These companies
were hired because they claimed they would be the best at the reconstruction of
New Orleans after their experience in Iraq. As a result of poor disaster
management, the lower class was at a disadvantage while the upper class
benefited. Many lower class citizens were stranded on their rooftops for days,
lost their homes, and were economically forced to move out of the city. The
upper class, on the other hand, just called their insurance companies, got on a
plane, and used the disaster as an excuse for an out-of-town vacation. As a
result of the overspending and underachieving of private companies, the funding
of social services was decreased. The poor were further hurt by this because
they needed them most. Hurricane Katrina was a perfect example of privatization,
deregulation, and classism, which are classic elements of the shock doctrine.
A similar process took place following the tsunami that hit
Asia in 2004. Like New Orleans, the city of Sri Lanka was a desirable location
for corporate investment. No significant industry was able to develop before
the tsunami because of an ongoing civil war and because fishing villages
inhabited the coastline. When the civil war ended, both tourists and local
fishermen crowded the oceanfront. The Government supported the booming tourism
industry, which did not wish to coexist with the fishing villages. US
investors, the International Monetary Fund and the World Bank, all pressured
the government to support the tourist industry, and wanted a piece of the
profit. The villagers would not allow this, until they did not have a choice.
When the tsunami tore-up the coastline, it killed 250,00 people and left 2.5
million homeless. The survivors were sent to refugee camps, and were banned
from returning to their villages because of safety concerns. The real reason
was of course not safety concerns, but because they would get in the way of the
reconstruction plan. The vulnerability of the situation presented investors a
magnificent opportunity, which they quickly seized. “Aid” was abundantly
donated to the disaster, where much of it was not spent on the people’s
problems, but on building hotels. Foreign companies that had previous experience
in disaster reconstruction, and the shock doctrine methods, were hired almost
immediately. Foreign companies made significant amounts of money through the
construction process and hotel ownership. The fishermen and villagers lost
their way of life, their homes, and did not get any share of the profits. If
the villagers were not fighting for survival during a crisis, they would have revolted and not
allowed the reconstruction to go the way it did.
In both New Orleans and Sri Lanka, people were faced with
crisis and devastation. The blank slates that the disasters left behind were
extraordinary opportunities for investors and corporate gain. Preoccupied with
meeting their daily needs, the lower classes did not have a chance to fight
back against the injustices that were occurring. How the investors in these
situations thought making a profit was more important than the well-being of
the lower-class is sickening to any person who has a conscious, but I’m sure
that Milton Friedman would be proud of how well his theories were played out.
