Disaster Capitalism Across America

Naomi Klein, author of "The Shock Doctrine," was on the Rachel Maddow Show last night and brought her analysis to the TARP right front and center. Click here for the clip.

According to Klein, who also writes for The Nation, once again we are taking enormous amounts of public money to bail out private interests, i.e. the banks, the very richest, because they made a series of very bad private mistakes.

When comparing the amount of money spent on the banks with the amount of money being spent on helping individuals, and the reticence in helping individual homeowners adjust their onerous mortgages, we should be appalled. Add to that those governors who are refusing to take portions of the stimulus package to pay for additional unemployment insurance -- Rick Perry from Texas and Bobby Jindal from Louisiana, to name two -- and our heads should be spinning.

Who is claiming that Obama is really calling for socialism in his health care and jobs stimulus package? We already have redistribution of wealth, but from the public to the private sector, in the TARP. Think about it. Three trillion or more has actually gone to the banks from the Federal Reserve and TARP.

Why I Love 30 Rock

I didn't like it at first. It took three years before my daughter sat me down in front of her computer and showed me the light. Although she and I adore 30 Rock for very different reasons. She finds the characters delightfully wacky and funny.

I find Jack, such a corporate parody, so self-absorbed, so full of MBA management truisms, as the head of the microwave and entertainment divisions of NBC, the real dark humor of the show. Jack is the character constructed by Alec Baldwin, and in real life, Jack is sinister.

What amazes me is that NBC hasn't pulled the show.

It truly is subversive.

As we watch the functions of government get privatized through disasters, war, and fear--entire communities outside Atlanta, GA are now independent fiefdoms run by private companies, the same companies who brought us post-invasion Iraq and post-Hurricane Katrina, who profits?

According to Naomi Klein in The Shock Doctrine, "...General Electric, which owns NBC, purchased InVision, the major producer of controversial high-tech bomb detection devices used in airports and other public spaces. InVision received a staggering $15 billion in Homeland Security contracts between 2001 and 2006, more of such contracts than any other company."

That's Jack's microwave division, albeit more insidious. We aren't talking about a pocket size microwave, as featured on a show this season, but an entertainment company whose back end is all munitions, private security, and war. And we wonder why corporate media wasn't critical of Bush and Cheney before the invasion of Iraq?

Mandatory Reading

As painful as it is to read these books, as citizens who desire a more humane and egalitarian world, we must know what has been done in our names. At least three books are mandatory: Philippe Sands "Torture Team"; Jane Mayer "The Dark Side"; and Naomi Klein "The Shock Doctrine."

Each points a finger at top members of the Bush Administration for taking the reigns of our government and turning our resources to defiling America, eroding a commitment to civil and human rights, devastating the efficacy of government, and all the while making exorbitant profits. The hundreds of thousands of lives destroyed by the Bush Administration during the course of its "war on terror" is horrifying in and of itself. However, the profits made by American corporations as the functions of government here and abroad were privatized add another dimension to the last eight years, especially when one sees just how much Donald Rumsfeld, Dick Cheney, and George Bush, Sr. made through the war in Iraq and the more pervasive "war on terror."

As informed citizens of this country and of the world, we must insist that the Obama Administration take the steps necessary to investigate, prosecute, and undo the damage done by the ideologues of the last presidency. We have no choice. This information is out there, and to choose not act is an act of such hubris and arrogance that I doubt the rest of the world will ever respect the United States again. No matter how popular Obama might seem today.

Improvisation

One wouldn't expect this, but economists have a habit of speaking confidently when they are really just improvising, thinking through a theory or ideological theory, even worse, and then having the balls to convince a government to let them try it out.

Reading The Shock Doctrine by Naomi Klein, especially now, especially living in a post-Bush world with the consequences of a Bush presidency, we should be a bit skeptical about the decisions being made here, at the G 20 Summit that just closed in London, and inside the World Bank and International Monetary Fund. We have to get smarter about economics and money.

Economists like Milton Friedman, who won a Nobel Prize in 1976, was the expert helping the infamous, brutal war criminal General Pinochet "transform" Chile into a radical free market state. President Salvador Allende was assassinated during a military coup that was in large part orchestrated by Nixon-Kissinger to assure that the natural resources of the country would not fall back into the hands of the people who owned them. Then in came Milton Friedman and his "Chicago Boys" to destroy the safety net, the middle class, the trade union movement, and spread poverty while dividing up those rich natural resources among multinational corporations.

And Jeffrey Sachs, the guru of Bono now and a big name in international aid, was once the economist who helped Bolivia achieve the same rape of its people, although a bit less brutally than Chile, and who was responsible for leading post-Apartheid South Africa away from a socialized state with redistribution of wealth as a means of reparations to those Africans who had suffered so under colonialism, and into a give away that assured that South Africans, the dark skinned ones, would remain poor and in shantytowns. Unemployment rates are higher there now than ever before.

In America we look to the World Bank and International Monetary Fund as somehow benevolent institutions because up to now we have always controlled them, but that isn't how they are seen by developing nations. So these agreements that came out of the G 20 Summit in London should be viewed skeptically. We are watching a bailout that is destroying the middle and working classes in our own country, destroying the safety net and trade unions, while pouring money into the banks and investment houses. And we see some of the same economists in the background. Once again Larry Summers is right there. Read about him and then wonder if he should have the ear of the President. Now it's been disclosed just how much money he made spekaing with the same companies he is trying to rescue. Why is Paul Krugman so critical of Obama's decisions? Krugman is another Nobel winner for economics.

Essentially no one knows what they are doing! It's all improvisation.

Shock Doctrine Redux

Now that Naomi Klein's book Shock Doctrine is in paperback, we all have to read it. Read her September 22 post on Huffingtonpost.com. Because guess who is going to administer the $700 billion bailout of Wall Street?

It won't be a new federal bureaucracy. It will be the same financial services and mortgage companies that got us into this mess in the first place.

So the money is going to bail out Wall Street double-time. First, the money will buy up the bad debt that was often fraudulently sold to many homeowners, knowing that the monthly payments were absurdly high. You and I will own those mortgages although you might be losing your own home

Second, the money will pay for the financial services companies to assess, bundle, and sell the same mortgages they underwrote and bundled and sold. So, we have a federal welfare-to-work program.

This seems to be the legacy of the Bush administration: turn every disaster into private profiteering, whether it's Katrina, Iraq, Ike, or the subprime mortgage meltdown that Henry Paulson, Treasury Secretary, didn't see coming. Or did he? While Paulson was still CEO of Goldman Sachs, the investment house was as busy as most bundling subprime debt as safe investments for sale to its customers. However, Goldman hedged its holdings in subprime mortgages. In the third quarter of 2007, after Paulson left, Goldman had a 70% increase in income while other houses were already writing down bad debt. Goldman made money if the price of these bundled bad mortgages lost money. And so the investment house did.

It's hard work living in a democracy, because we have to remain informed, even if it gives us a headache.