Obama’s Shock Doctrine

(2 pm. – promoted by ek hornbeck)

Cross posted from The Stars Hollow Gazette

In the “Shock Doctrine”, Naomi Klein describes disaster capitalism as “treating disasters as exciting market opportunities”. She also explains core economic philosophy of Milton Friedman, an American economist, statistician, academic, and author who taught at the University of Chicago. He was also economic advisor to President Ronald Reagan. What has now become known as the “shock doctrine” is Friedman’s lasting legacy. It is Friedman’s teaching that are at the core of the tactics being used by the Tea Party and the GOP in with the completely manufactured debt ceiling crisis.

Friedman observed in “Capitalism and Freedom:

Only a crisis – actual or perceived – produces real change. When that crisis occurs, the actions that are taken depends in the ideas that are lying around. That, I believe, is our basic function to develop alternatives to existing policies, to keep them alive and available until the politically impossible  becomes the politically inevitable

This is precisely what has unfolded over the last 11 years since President George W. Bush cut taxes favoring the wealthy and corporations until today with the passage of the bill raising the debt ceiling and the creation of the new “super committee” that will inevitably slash Social Security, Medicare and any other social safety program while raising no revenues.

Friedman also noted that a new administration has a six to nine month window to achieve major changes and if it doesn’t seize the opportunity to act decisively in that period, it won’t get another chance. The Bush administration understood that along with controlling both houses of congress which facilitated the tax cuts, the passage of the Patriot Act and the trillions that were thrown at the wars and the banks in 2008 with TARP.

President Obama had the perfect opportunity to do do much of what he had promised in the first six months if 2009. The question is why didn’t he press his agenda with the Democratic majority controlled congress? If you look closely at his campaign speeches and interviews and his history in politics then the legislative and policy results of the last three years were quite predictable.

It was Rep. John Conyers (D-CA), angered at Obama during this debt ceiling negotiations, who pointed out that it was Obama who put the big three social safety programs on the table, not the Republicans. Republican were decimated in two electoral cycles partially based on the electorate fear that these programs would be thrown to the wolves of corporations and Wall St. Little did most voters realize that it would be a Democratic president and congress that would chisel away at those programs with “shock Doctrine” tactics of making them vulnerable with the ACA, which helped revive the Republicans, and the manufactured debt ceiling crisis.

Some Obama supporters, in attempts to explain his policy’s and what at first glance appears to be failure and leadership weakness, blame the obstructionist tactics of the GOP and feckless blue dogs in the Senate and the tea party. But it was Obama who created the deficit commission to look at ways to cut the deficit. It was Obama who appointed two deficit and anti-social security hawks to chair the commission. And who helped finance it? None other than octogenarian, billionaire Pete Peterson whose life’s goal has been to end Social Security and Medicare.

It was Obama who took single payer off the table even before talks on ACA began. He then proceeded to negotiate behind close doors with hospital executives, insurance and pharmaceutical industry to remove the public option and lower prescription drug costs.

It was Obama who failed to get a strong bank regulatory bill and prosecute the bankers for the fraud in the mortgage and housing collapse. It was Obama who agreed to extend the Bush tax cuts for two more years worsening the deficit and cut payroll taxes making Social Security part of the deficit problem for the first time and actually raising taxes on households making less than $40,000 worsening their economic status. It was Obama who blocked cost of living raises for Social Security recipients and retires federal employees and froze pay for all federal employees.

Some critics are trying to explain away all these events as weakness either do not understand, or are just ignoring, that this latest “crisis” ws as much Obama’s making as it was the tea party’s.

Paul Krugman gets it now when he concluded that this is what Obama wants

Glenn Greenwald said “the President wanted tax revenues to be part of this deal.  But it is absolutely false that he did not want these brutal budget cuts and was simply forced — either by his own strategic “blunders” or the “weakness” of his office — into accepting them.  The evidence is overwhelming that Obama has long wanted exactly what he got: these severe domestic budget cuts and even ones well beyond these, including Social Security and Medicare, which he is likely to get with the Super-Committee created by this bill.”

At “Rolling Stone”, Matt Taibbi, on pondering Obama’s tack to starboard, thinks that Obama is doing what he is told

The Democrats, despite sitting in the White House, the most awesome repository of political power on the planet, didn’t fight at all. They made a show of a tussle for a good long time — as fixed fights go, you don’t see many that last into the 11th and 12th rounds, like this one did — but at the final hour, they let out a whimper and took a dive.

We probably need to start wondering why this keeps happening. Also, this: if the Democrats suck so bad at political combat, then how come they continue to be rewarded with such massive quantities of campaign contributions? When the final tally comes in for the 2012 presidential race, who among us wouldn’t bet that Barack Obama is going to beat his Republican opponent in the fundraising column very handily? At the very least, he won’t be out-funded, I can almost guarantee that.

And what does that mean? Who spends hundreds of millions of dollars for what looks, on the outside, like rank incompetence?

It strains the imagination to think that the country’s smartest businessmen keep paying top dollar for such lousy performance. Is it possible that by “surrendering” at the 11th hour and signing off on a deal that presages deep cuts in spending for the middle class, but avoids tax increases for the rich, Obama is doing exactly what was expected of him?

Yes, that is exactly what he is doing. This was and is Obama’s plan.

h/t Vastleft for the graphic


Skip to comment form

    • TMC on August 4, 2011 at 06:49
  1. … New Energy Economy bill after Health Care Reform, even after promising in the campaign to put it as the very first thing.

    If even that half measure had gone through, we would be reaping the employment benefits now, unemployment would be dropping, and Obama’s re-election would be close to a shoo-in.

    Which goes back to Noami Klein’s point about the “ideas laying around”. The radical reactionary propaganda mills have been seeding their ideas in support of Predatory Capitalism for decades … and at the same time within the academy, the “Harvard Economic Dept” approach to economics has been getting worse and worse.

    Its easy for someone taking advice from the Harvard style of lies and fantasies about the economy to feel all so superior to the radical reactionary political propaganda ~ all the while being trapped into viewing the economy through seriously warped and cracked lenses.

    The progressive “ideas laying around” can be dismissed out of hand when viewed through those lenses … due to the predictable biases of the lens. Its like the impression that people getting from looking at the size distorting projection that Africa, the second largest continent, is way smaller than Asia, and only a little bigger than North America ~ when in reality its much closer in size to Asia than most of us realize, and way bigger than North America.

  2. “Rebuilding America’s Defenses” from a comment of mine made in November, 2010.

    Thanks for this, TMC!  

Comments have been disabled.