Enter the Disaster Capitalists

By Jim Miller

We’ve seen this before: crisis as opportunity.  Whether it be the ways the right-wing and corporate America took advantage of 9/11 to shape economic policy and the political landscape in their favor, the shameless opportunism in the wake of Hurricane Katrina, or the host of other ways that American society has been transformed for the worse by the power elite over the last few decades.

Here we go again.

As Naomi Klein commented last week :

Look, we know this script. In 2008, the last time we had a global financial meltdown, the same kinds of bad ideas for no-strings-attached corporate bailouts carried the day, and regular people around the world paid the price. And even that was entirely predictable.

Thirteen years ago, I wrote a book called The Shock Doctrine: The Rise of Disaster Capitalism, described a brutal and recurring tactic by right-wing governments. After a shocking event — a war, coup, terrorist attack, market crash or natural disaster — they exploit the public’s disorientation, suspend democracy, push through radical free market policies that enrich the 1% at the expense of the poor and middle class.

Now with the Trump Administration advocating for huge bailouts for corporations along with corporate and payroll taxes that overwhelmingly favor the rich, disaster capitalism is once again presenting itself as the answer to what ails us in this time of crisis.  Observers such as Michael Hiltzik at the Los Angeles Times have adeptly shown how ineffective and inequitable these kinds of solutions would be and how ultimately they would do great damage to working people by undermining Social Security , while prominent economists like Joseph Stiglitz have criticized Trump’s plans as “trickle down” half-measures, not up to the task of addressing the harm that the COVID-19 crisis will do to the overall economy and individual workers’ lives .

Nonetheless, the response for the Democratic leadership in Congress has been tepid at best, embarrassingly bad at worst, with Trump and the Republicans stealing the stage by flanking them on the left by offering direct payments to Americans with one hand while pushing for massive corporate bailouts and tax cuts with the other.  With Schumer and Pelosi caught flat-footed, Sanders, along with other progressives, has stepped up with bolder proposals.

As In These Times reported last week:

Sen. Bernie Sanders (I-Vt.) has presented a bold $2 trillion plan including direct monthly cash payouts of $2,000 to every household, 100% payment of unemployment benefits for everyone who loses their job as a result of the crisis as well as moratoriums on evictions, foreclosures, utility shutoffs and loan payments. A similar set of proposals was put forward Wednesday by House Financial Services Chairwoman Maxine Waters, including billions of dollars in grants to small businesses.

Elizabeth Warren has also pushed the leadership to adopt bolder proposals as the Washington Post notes :

Warren, who rose to political prominence as a critic and player in the 2008 financial bailout, has pushed an effort to cancel $10,000 of federal student loan debt per person, an idea that’s been embraced by Schumer. He also backed her call for a temporary $200 per month hike in Social Security payments, similar to a proposal she first floated on the campaign trail.”

In a similar vein, Naomi Klein too has chimed in, suggesting that if we don’t want the disaster capitalists to win the day, progressives need to counter their proposals with a bolder vision:

It’s called the Green New Deal. Instead of rescuing the dirty industries of the last century, we should be boosting the clean ones that will lead us into safely in the coming century. If there is one thing history teaches us, it’s that moments of shock are profoundly volatile. We either lose a whole lot of ground, get fleeced by elites and pay the price for decades, or we win progressive victories that seemed impossible just a few weeks earlier. This is no time to lose our nerve. The future will be determined by whoever is willing to fight harder for the ideas they have lying around.

Of course, the painful irony here is that in the presidential race, while most voters approve of notions like universal health care and bold action on climate, the advocates for those policies have been roundly defeated by Joe Biden whose proposals don’t come close to answering the call of history.  It’s not particularly good timing. At this pivotal moment, we can’t let fear and political calculation paralyze us. If we don’t push our leaders for something better, we’ll pay a huge price in the lives and the economic well-being of the vast majority of working people in America.

Whatever the usual political calculus would suggest should be tossed out the window because the circumstances demand something much bigger.  As a Washington Post piece last week observed , beleaguered American cities need “something bigger than the New Deal just to cope.”

Whichever package emerges today from the Congress will not be nearly enough to help the majority of Americans weather this crisis.  Trump’s hesitance to use the tools of government to take more effective collective action is a predictable product of thirty years of rightwing ideological assault against not just “big government,” but the government period.

Now, inconveniently for both the American right and neoliberal Democrats allergic to the New Deal legacy of their own party, the only effective answer is massive government action and spending on things that will help protect the health of Americans and save them economically in a bottom up fashion.  If all we end up with are more gains for disaster capitalists and chump change or worse for the majority of Americans, it will be the fault of both the rightwing but also a Democratic leadership too timid to present a compelling counternarrative.

On the other side of this crisis, we don’t want to be ruing the waste of an unprecedented opportunity to make the case for the essential role of effective government, a real healthcare infrastructure, and an economy that works for all of us and won’t speed our way to ecocide and the host of new pandemics that that will bring to our doorsteps.