David Boaz: In Obama’s economic stimulus push, we’re seeing Naomi Klein’s Shock Doctrine in reverse

On the economy, Obama is trying to scare the American people in order to ram through a progressive agenda

"Profound economic emergency," the president says. Failure to pass his spending plan could "turn a crisis into a catastrophe". Any delay will mean "paralysis" and "disaster". It's all out of the "shock doctrine" playbook: scare people to death and then demand that your agenda be enacted without delay.

Naomi Klein made waves two years ago with her book The Shock Doctrine, in which she claimed that conservative governments use crises to ram through free-market policies. As she put it in an interview: "The Shock Doctrine is a political strategy that the Republican right has been perfecting over the past 35 years to use for various different kinds of shocks. They could be wars, natural disasters, economic crises, anything that sends a society into a state of shock to push through what economists call 'economic shock therapy' – rapid-fire, pro-corporate policies that they couldn't get through if people weren't in a state of fear and panic."

And that's just what we're seeing today – only in reverse.

Last year the US economy was hit with one shock after another: the Bear Stearns bail-out, the Indymac collapse, the implosion of Fannie Mae and Freddie Mac, the AIG nationalisation, the biggest stock market drop ever, the $700bn Wall Street bail-out and more – all accompanied by a steady drumbeat of apocalyptic language from political leaders.

And what happened? Did the Republican administration summon up the spirit of Milton Friedman and cut government spending? Did it deregulate and privatise?

No.

It did what governments actually do in a crisis – it seized new powers over the economy. It dramatically expanded the regulatory powers of the Federal Reserve and injected a trillion dollars of inflationary credit into the banking system. It partially nationalised the biggest banks. It appropriated $700bn with which to intervene in the economy. It made General Motors and Chrysler wards of the federal government. It wrote a bail-out bill giving the secretary of the treasury extraordinary powers that could not be reviewed by courts or other government agencies.

Now the Obama administration is continuing this drive toward centralisation and government domination of the economy. And its key players are explicitly referring to heir own version of the shock doctrine. Rahm Emanuel, the White House chief of staff, said the economic crisis facing the country is "an opportunity for us". After all, he said: "You never want a serious crisis to go to waste. And this crisis provides the opportunity for us to do things that you could not do before" such as taking control of the financial, energy, information and healthcare industries.

That's just the sort of thing Naomi Klein would have us believe that free-marketers like Milton Friedman think. "Some people stockpile canned goods and water in preparation for major disasters," Klein wrote. "Friedmanites stockpile free-market ideas." But that is exactly what American left-liberals have been doing in anticipation of a Democratic administration coming to power at a time when the public might be frightened into accepting more government than it normally would. For instance, the Centre for American Progress, run by John Podesta, who was President Bill Clinton's chief of staff and President-elect Obama's transition director, has just released Change for America: A Progressive Blueprint for the 44th President.

Paul Krugman, the Bush-bashing New York Times columnist, endorsed Emanuel's enthusiasm: "Progressives hope that the Obama administration, like the New Deal, will respond to the current economic and financial crisis by creating institutions, especially a universal healthcare system, that will change the shape of American society for generations to come."

Arianna Huffington had called Klein's book "prophetic". As the Obama team began drawing up plans, she proved just how right she was, declaring: "A crisis is a terrible thing to waste. And it might be this particular crisis that will make it possible for the Obama administration to do some really innovative, bold things on healthcare, on energy independence, on all the areas that have been neglected."

None of this should surprise us. It's crazy to think that most governments will respond to a crisis by reducing their own powers and deregulating the economy, as Klein would have us believe. Political leaders naturally respond to crisis by riding in as the man on the white horse and taking control.

As Rick Perlstein, liberal historian, wrote: "The Oval Office's most effective inhabitants have always understood [that a crisis is the best opportunity to make radical change]. Franklin D Roosevelt hurled down executive orders and legislative proposals like thunderbolts during his first hundred days, hardly slowing down for another four years before his window slammed shut; Lyndon Johnson, aided by John F Kennedy's martyrdom and the landslide of 1964, legislated at such a breakneck pace his aides were in awe. Both presidents understood that there are too many choke points – our minority-enabling constitutional system, our national tendency toward individualism and our concentration of vested interests – to make change possible any other way."

Robert Higgs, the libertarian historian, is less enthusiastic. In Crisis and Leviathan, he demonstrated that government growth in the US has not been slow and steady, year in and year out. Rather, its scope and power tend to shoot up during wars and economic crises.

Occasionally, around the world, there have been instances where a crisis led to free-market reforms, such as the economic reforms in Britain and New Zealand in response to deteriorating economic conditions. Generally, though, governments seek to expand their power, and they take advantage of crises to do so. But they rarely spell their intentions out as clearly as Rahm Emanuel did.


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Posted on February 12, 2009  Posted to Barack Obama,Books,Comment,Comment is free,Democrats,Global recession,guardian.co.uk,Obama administration,Republicans,The Guardian,United States,US economic growth and recession,US economy,US politics,World news

David Boaz: The media sensationalises racist attacks against Barack Obama

Racist attacks on Barack Obama are few and far between, but that hasn't stopped the media from sensationalising them

Liberal journalists are combing the back roads of America looking for evidence of the resurgent racism being generated by the prospect of a black man becoming president. The striking thing is how little they've turned up in a country of 300m people with plenty of racial conflict in its history.

Here's how the Associated Press led a roundup story on Friday: "Race, an inescapable but explosive issue on which both presidential candidates have tread carefully if not tried to ignore, is increasingly popping up as it's becoming more likely the country will elect its first black president."

But since they couldn't find anything coming from John McCain, Sarah Palin or any of their staff or surrogates that would justify such a claim, the first evidence cited was that Democratic congressmen John Murtha and John Lewis had accused Barack Obama's opponents of racism.

Eventually the AP story got around to citing the evidence of racism directed toward Obama that its vast nationwide reporting staff had turned up:

• In San Bernardino County, California, the October newsletter of the Chaffey Community Republican Women, Federated, showed Obama's face on a phoney $10 government food stamp coupon adorned with a watermelon, ribs and a bucket of fried chicken. Diane Fedele, president of the group, apologised and she had no racist intent: "It was just food to me. It didn't mean anything else." The state GOP denounced the newsletter.

• In Nevada, Colorado and Michigan, TV ads show a clip of [the Rev Jeremiah] Wright declaring "God damn America!" in a sermon. "How can we forget these hateful sermons from Obama's pastor for over 20 years?" says one ad by the Our Country Deserves Better PAC, a Sacramento, California-based group that was formed to campaign against Obama.

• In Danville, Virginia, The Voice, a local newspaper, published a column by McCain's Buchanan County campaign chairman, Bobby May, that mocked an Obama administration. It said he would change the national anthem to the "Black National Anthem" while mandating that churches teach black liberation theology. Also, it said Obama would appoint Al Sharpton and Jesse Jackson to the Cabinet and put prominent blacks like Oprah Winfrey on currency. McCain's campaign dropped May from his job.

• In West Plains, Missouri, a remote town of 10,000 people near the Arkansas border, a prominent highway sign by an unknown creator shows a turban-wearing cartoon caricature of Obama, with an exaggerated smile, full lips and oversized teeth. It says: "Barack 'Hussein' Obama equals more abortions, same-sex marriages, taxes, gun regulations."

So what do we have here? One unknown group in Sacramento has run some ads reminding voters that Obama's decades-long pastor and spiritual adviser is pretty radical. The fact that Wright is black doesn't make that a racist argument. If McCain had sat in the pew for 20 years listening to a pastor who said, say, that "the pagans, and the abortionists, and the feminists, and the gays and the lesbians are responsible for the 9/11 attacks because they caused God to withdraw his protection for America," you can bet that would be an issue.

Otherwise, the AP has found three individuals in remote towns who have directed racial slurs at the first black candidate with a real chance to be president. That's pretty remarkable. We've made great progress since the civil rights revolution, but who would have guessed there'd be so little backlash?

That won't stop journalists from looking for it, though. Google "Obama racism", and you'll find hits like "Racism is the only reason Obama might lose" (because of course the most liberal Democrat in the Senate would be a shoo-in otherwise) and "Racist attacks on Obama growing more heated" (yes, on white supremacist and neo-Nazi websites) and "Racist Obama effigy hung in Ohio" (yes, one guy in rural Ohio hung a white-sheeted ghost labelled "Obama" in his yard, and his white neighbours are appalled).

On the web Sunday we got the headline "'Socialist', 'Muslim' – Ugly reception for Obama", who campaigned in the Cape Fear BBQ and Chicken in Fayetteville, North Carolina. But in fact it appears that there was just one woman who shouted "socialist" at him and also told a reporter that she suspected he was a "closet Muslim". The other white diners told her to quiet down and be civil. Reporters descended on her, though, and she did manage to direct a slur at General Colin Powell, who had endorsed Obama that morning: She called him "a Rino, R-I-N-O, Republican In Name Only".

Compared to the level of open anti-Catholic bias against John Kennedy in 1960, racism in the 2008 campaign is a dog that didn't bark.


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Posted on October 22, 2008  Posted to Barack Obama,Comment,Comment is free,guardian.co.uk,John McCain,Media,Race issues,Sarah Palin,The Guardian,US elections 2008,US politics

David Boaz: Jim Webb’s identity-based economic populism

David Boaz: The potential vice-presidential candidate supports liberal economic policies because of his Scots-Irish heritage

Posted on June 20, 2008  Posted to The Guardian

David Boaz: Jim Webb’s identity-based economic populism

The potential vice-presidential candidate supports liberal economic policies because of his Scots-Irish heritage

Richard Just at the New Republic magazine is not impressed with Virginia senator Jim Webb as a running mate for Barack Obama. Webb is fundamentally illiberal, he writes, a misogynist and an ethnic nationalist and "something of an apologist for the Confederacy." So why do lots of liberals like Webb, Just asks. "In the years since he left the Republican party, Webb has found his way to certain policy stands that liberals correctly find attractive. He was right about Iraq, and, on economics, he is right to criticise the disparity between rich and poor." Just can't figure out how a fundamentally illiberal Scots-Irish nationalist can arrive at all those good liberal tax-hiking, big-spending, trade-restricting positions that "liberals" like.

But in fact Webb's liberal positions on economic issues stem directly from his self-image as an oppressed working-class white man. When I read his book Born Fighting: How the Scots-Irish Shaped America, I was struck by how it burned with a passionate hatred of the English in both England and America, who in Webb's view had been keeping his people down for hundreds of years. Throughout the book he complains about "the Wasp hierarchy" and the "Cavalier aristocracy" from which the hard-working Scots-Irish have been systematically excluded. Just notes that too: "Perhaps the most unappealing thing about Webb's worldview is that it seems to be built largely on resentment. In his book Born Fighting, you can practically feel the resentment coming off the page."

Webb complains that affirmative action "focused only on the disadvantages that had accrued to blacks," while "the white cultures whose ancestors had gained the least benefit from the elitist social structure" were "grouped together with the veneer that had formed the aristocracy." Webb points out that in a landmark 1974 study from the National Opinion Research Centre, family incomes among different white ethnic groups varied far more than the black-white differential. White Protestants other than Episcopalians were at the bottom of the income rankings. White Baptists had an educational level at the same level as black Americans and far below that of Jews. A later NORC study, he went on to write, showed that as late as 2000 white Baptists and "Irish Protestants" had less educational attainment than the national average.

And the whole tone of Webb's discussion is not "Maybe we should have done less fighting and drinking and more reading." Rather, it's: "The English have kept us down." His complaint about affirmative action is not that blacks (and other racial minorities) get it. It's that his people don't.

In a Wall Street Journal column just after his election to the Senate, Webb applied his identity-based politics to current political issues. He complained about "our society's steady drift toward a class-based system," in which the rich make millions while workers face "stagnant wages and disappearing jobs" in an era of globalisation. In his campaign he called for ensuring that "free trade becomes fair trade."

Jim Webb supports Richard Just's economic policies because he is a burning mass of ethnic resentment. Maybe liberals should worry about that.


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Posted on June 20, 2008  Posted to Comment,Comment is free,guardian.co.uk,Race issues,The Guardian,United States,US economic growth and recession,US elections 2008,US politics

Full profile

David Boaz is the executive vice-president of the libertarian Cato Institute, a non-profit-making public policy research foundation headquartered in Washington DC. He is a leading authority on US domestic issues such as education choice, drug legalisation, the growth of government, and the rise of libertarianism

Posted on May 22, 2008  Posted to The Guardian

Full profile

David Boaz is the executive vice-president of the libertarian Cato Institute, a non-profit-making public policy research foundation headquartered in Washington DC. He is a leading authority on US domestic issues such as education choice, drug legalisation, the growth of government, and the rise of libertarianism.

He is the author of Libertarianism: A Primer, described by the Los Angeles Times as "a well-researched manifesto of libertarian ideas", the editor of The Libertarian Reader, and coeditor of the Cato Handbook on Policy. His latest book is The Politics of Freedom: Taking on the Left, the Right, and Threats to Our Liberties.

Boaz is the former editor of New Guard magazine and was executive director of the Council for a Competitive Economy prior to joining Cato in 1981. His articles have been published in the Wall Street Journal, the New York Times, the Washington Post, the Los Angeles Times, National Review, and Slate.

He is a frequent guest on national television and radio shows, and has appeared on ABC's Politically Incorrect with Bill Maher, CNN's Crossfire, NPR's Talk of the Nation and All Things Considered, John McLaughlin's One on One, Fox News Channel, BBC, Voice of America, Radio Free Europe, and other media.


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Posted on May 22, 2008  Posted to Global,guardian.co.uk,Profiles,Resources,The Guardian

Hillary and the imperial presidency

US elections 2008: Clinton's promise to curtail executive power and restore checks and balances is belied by her record

Posted on April 30, 2008  Posted to The Guardian

Hillary and the imperial presidency

US elections 2008: Clinton's promise to curtail executive power and restore checks and balances is belied by her record

Posted on April 30, 2008  Posted to The Guardian

Hillary and the imperial presidency

US elections 2008: Clinton's promise to curtail executive power and restore checks and balances is belied by her record

In a speech to newspaper editors earlier this month, senator Hillary Clinton denounced the "imperial presidency" of George Bush and promised to pursue a different course if she becomes president.

But that promise is hardly more believable than her claims to have dodged sniper fire in Bosnia.

Clinton's primary case for her candidacy is her White House experience during the presidency of her husband. And those years were marked by expansions of federal and executive power, secrecy and claims of executive privilege.

In her campaign she says that she would "restore the checks and balances and the separation of powers". But back in 2003, she told ABC's George Stephanopoulos: "I'm a strong believer in executive authority. I wish that, when my husband was president, people in Congress had been more willing to recognise presidential authority." She encouraged President Clinton to intervene in Haiti and Bosnia and to bomb Serbia, all without congressional authorisation.

In the case of the bombing of Serbia, Congress actually took a vote. The House of Representatives refused to authorise the air strikes, but the Clinton administration "sort of just blew by" that technicality, in the words of a White House spokesman.

President Clinton also ordered air strikes on Afghanistan, Sudan and Iraq, all without congressional approval. That's practically the definition of an imperial president, and it sharply undermines Hillary Clinton's statement in this campaign that "I do not believe that the president can take military action - including any kind of strategic bombing - against Iran without congressional authorisation."

The Clinton administration also vastly expanded the use of executive orders to usurp Congress's lawmaking powers. President Clinton used executive orders to nationalise millions of acres of land, impose pro-union rules that Congress wouldn't pass, strengthen the federal government's hand in disputes over federalism, self-authorise his military actions in Yugoslavia and more. The most succinct and pointed defence of his unilateral legislating came from White House aide Paul Begala: "Stroke of the pen. Law of the land. Kind of cool."

As William Olson and Alan Woll pointed out in a 1999 Cato Institute study, President Clinton often legislated through an even more obscure vehicle than executive orders. "Several of President Clinton's major policy actions, for which he has been severely criticised, were accomplished not through formal directives but through orders to subordinates, or 'memoranda'. Those include his 'don't ask, don't tell' rule for the military; his removal of previously imposed bans on abortions in military hospitals, on foetal tissue experimentation, on Agency for International Development funding for abortion counselling organisations and on the importation of the abortifacient drug RU-486; and his efforts to reduce the number of federally licensed firearms dealers."

In another Clinton-era study, Timothy Lynch took the administration to task for its warrantless searches and wiretapping, its unauthorised military actions and its legal claim that the federal government has "plenary powers" to legislate on any matter, notwithstanding the limitations imposed by the Constitution.

Senator Clinton told the newspaper editors: "I will restore openness in government. When I am president, the era of Bush/Cheney secrecy will be over." But the Clinton administration fought in court to keep secret the names of those who participated in first lady Hillary Clinton's task force on healthcare reform. And Bill Clinton repeatedly claimed executive privilege to resist investigations by Congress and independent counsels into his pardons of Puerto Rican terrorists, his perjury in the Monica Lewinsky case and other matters. In his battles with independent counsel Kenneth Starr, Clinton became the first president since Watergate to take a claim of executive privilege to court and lose. "Openness" is not a quality the Clintons have been noted for.

The big problem with Hillary Clinton's promise to be a less imperial president is her expansive conception of the role of the federal government in society. Clinton wants the federal government to have vast powers to do good as she sees it. She told the newspaper editors: "I believe in the power of the presidency to set big goals for America and to solve the problems of Americans, to ensure that our people have the tools they need to turn challenges into opportunities, to fulfil their God-given potential and to build better lives for themselves and their children."

At other times she has proclaimed herself a "government junkie", promised to devote herself to "redefining who we are as human beings in the post-modern age" and declared that her administration would help Americans to "quit smoking, to get more exercise, to eat right, to take their vitamins".

Any president who views the federal government as a vast, sprawling nanny, a nurturing mother for every adult, is going to view resistance to her plans as an affront to decency. And as President Bill Clinton demonstrated, if Congress won't act or votes against the president's policies, the president must act in the name of all the people to give the people what they need. Aggrandisement of presidential power has consistently gone along with growth in the size, scope and power of the federal government.

The latest Washington Post-ABC News poll shows that only 39% of Americans regard Hillary Clinton as "honest and trustworthy". It's hard to imagine that even 39% of voters would believe her promise to restore checks and balances and reduce the power of the office she seeks to occupy.

For more blogs on the US elections, click here.

For more US election coverage, click here.


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Posted on April 30, 2008  Posted to Comment,Comment is free,George Bush,guardian.co.uk,Hillary Clinton,The Guardian,US politics

Sex, religion and conservatives

Why do conservatives support laws against discrimination for characteristics that they approve of, but not for characteristics they don't approve of?

Posted on February 29, 2008  Posted to The Guardian

About David Boaz

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