The Shock Doctrine - Naomi Klein

[Dances]

Oh my it's brutal but there. On AIBU. Social scolding hellfire.

Do people have no concept of the risks of overreach by police and of government taking advantage of a crisis situation?

Also, just remembered reading Naomi Klein's, 'The Shock Doctrine' which documented how governments around the world took advantage of national crises to impose right wing legislation. Shocking book and we should be alert to the risks. Has anyone read it?

Would be interested to discuss the risks of goverments pushing through legislation they would normally have no chance of passing.

That Democracy Now link gives a good summary of the shock doctrine (my bolding):

Now she argues Trump’s plan is a pandemic shock doctrine, but it’s not the only way forward. The video opens with this quote from economist Milton Friedman, who says, “Only a crisis — actual or perceived — produces real change. When that crisis occurs, the actions that are taken depend on the ideas that are lying around. ”

NAOMI KLEIN: “Ideas that are lying around.” Friedman, one of history’s most extreme free market economists, was wrong about a whole lot, but he was right about that. In times of crisis, seemingly impossible ideas suddenly become possible. But whose ideas? Sensible, fair ones, designed to keep as many people as possible safe, secure and healthy? Or predatory ideas, designed to further enrich the already unimaginably wealthy while leaving the most vulnerable further exposed? The world economy is seizing up in the face of cascading shocks.

www.democracynow.org/2020/3/19/naomi_klein_coronavirus_capitalism

It is also incredibly important that people understand how money is created and how it functions in modern economies, so that they are not fooled when the usual nonsense will be wheeled out after Covid-19 abates about how public services will have to be cut or privatised to 'pay back' all the 'debt' the government has incurred on our behalf.
This myth is peddled by both the right and the left. Genuine progressive change cannot happen if economic illiteracy is widespread. There is a reason why economics is kept obscure with complicated jargon and not taught properly in schools and universities.

For nations that have their own Central Bank and free floating currency, the government can never run out of money and is able to create as much money as the economy needs. Our taxes do not fund government spending.

Government spending is what creates money in an economy. Taxation is a socioeconomic tool that has several uses, and one of them is to help remove money from circulation in an economy, thereby acting as a mechanism to control any inflation.

This is a fairly simple intro into what money actually is and how it functions. Although US based, it applies to any country with a 'fiat' currency such as the UK, Australia, Japan etc.

www.modernmoneybasics.com

The government can always create the money it needs. It can never run out of it. It is political will that determines whether the money that is generated is spent on healthcare and housing or wars and weapons. The answer to 'can we afford it?' is always 'Yes.'

There are limits to what we can do, but these are based on our finite resources. Money is infinite, but the things we produce and the services we provide are not.

Covid-19 has illustrated this by how governments around the world are able to almost effortlessly generate billions or even trillions to keep the private sector going, especially during a crisis.
Nurses, ventilators, PPE, truck drivers etc are real resources and they are finite, so we can run out of them and need to manufacture more or buy / import what we need.

There are limits to what we can do, but these are based on our finite resources. Money is infinite, but the things we produce and the services we provide are not.

This is what I find odd when I hear people talking about this. So long as their is the same amount of stuff produced, it can be distributed. We could change how it gets distributed, but at least theoretically we could choose to distribute it according to need or in an attempt to make sure everyone gets a fair amount.

Now, it may be that due to the pandemic some things won't get produced, in fact I expect that is going to be the case. But it seems that there is real effort going into making sure that we make sure the essential things are still produced, people can get food and oil or whatever to heat their homes, and medicine, and so on. And we are also trying to keep people working in essential services, though maybe there will be staffing issues in some cases.

So what's really the issue? We will have the things people need, the problem is really just cash flow for individuals who have been out of work or have had non-essential businesses close. But surely there should be some kind of way we can creatively overcome that?

....there is the same amount of stuff

Hi Goosefoot, sorry had an early night so didn't see your reply.

I was making a comparison between money (creation) and real economic productivity which is linked to our (finite) resources.

Pandemic aside - imagine if a government proposed to build 100 new, well-equipped hospitals in a year all around the country; they estimate it will cost 50 billion. (I'm just making up numbers as examples.)
A great idea, given the state of health services in most countries including the UK, Canada etc.

The usual media and public response is How will we pay for it? , How can we afford it? , Is the government being reckless / wasteful with 'taxpayers' money? Etc.
All the scrutiny focuses on the assumption that money is a finite thing, that we will spend too much and the 'public purse' will run dry. (Note, I'm not saying we should be deliberately wasteful with money or not care about analysing the costs of projects, planning budgets and so on.)

When people start to understand how money creation and its use actually works - governments cannot run out of money, our taxes do not pay for central government spending (local councils and devolved administrations are different; they do not have a Central Bank), governments can always create money if it's needed - this changes the nature of public discourse. Of course the government can afford to spend 50 billion. Money is not the issue here as it simply creates it when it's needed / necessary. We know this and we've seen it. And having good quality hospitals all over the country is a necessity. Why should we not have decent healthcare for all? Besides, it's not 'taxpayers' money.

So the discussion can move to more factual and fruitful debate - 100 hospitals in a year is very ambitious.. how much building / raw materials would we need? Do we have enough already or can we easily produce more at short notice? Would we have to import more from elsewhere? If we rely on predominantly imported resources, might that put a spanner in our plans if international relations deteriorate?

What about all the beds and equipment needed, like scanners and ventilators? Again, can we easily mass produce them in a year? Since governments have sufficient leverage and purchasing power, it has an important decision to make - it can order and import from abroad like China at cheap prices or it can choose to sign a contract with our own local manufacturers at reasonable cost so that it stimulates our own economy and provides work to our people (we've seen the decline in industry in UK and how industrial towns and cities have been decimated by lack of investment...).

What about construction staff? Are the current private construction businesses adequately staffed? Do we have to train more people on some government scheme to ramp up the numbers (which will take time)? Would companies divert their manpower from other large scale public or private projects, for example a national affordable house building scheme? This can impact other projects or compete with other pressing social and economic needs.

Once the hospitals are complete, they will all need to be staffed. We need doctors, nurses and other medical personnel - it would be foolish to have 100 hospitals but only a quarter being used because we can't find the staff for the rest. Previous government policies have hampered training and growth of medical personnel by slashing grants and bursaries given to trainee nurses and so on. Most Western countries have lazily relied on a steady supply of willing immigrants to staff health services for decades. We should move towards enabling more of our own citizens to get into medical and nursing school, make it easier for those from lower socioeconomic backgrounds to afford the long years of training, pay them well so that we retain their valuable services for a long time to come. Yes we will still need to rely on immigration now and then to plug shortfalls, but decent governments must invest in their citizens so that employment and wealth genuinely spreads through our communities. It's not handouts that many poor communities need, but decent work at decent pay to enable them to have pride and purpose again.

Sorry I've been rambling, but what I wanted to convey is that public money is infinite and easily created. We are constrained by our real resources and governments (and we who elect them) must make important, and sometimes difficult, decisions on how these finite resources are allocated, short-term and long-term, and how we invest in our people so that there is continuity of prosperity for all.

You don't need communism or some far left political agenda. I know some will disagree, but a healthy mix of good public governance and well regulated private markets can work well. You need a government with a backbone though, that doesn't shy away from enacting public policies that will benefit as many of its citizens as possible instead of letting power and wealth concentrate in the hands of a few and allowing public services and infrastructure to crumble.
And as citizens it's important we understand how economic systems work, what are the pitfalls of current economic orthodoxy, so that we can hold our governments to account and ask the real questions when they come up with ideas and schemes.

I wasn't disagreeing with you really, really just saying the same thing in a different way. Money in itself is a symbol, the real question is productivity, and also that should include sustainability though often it doesn't. When people are thinking about the aftermath of this pandemic, what they need to realise is that productivity is impacted, but it shouldn't be enough that as a society we need to have people in real trouble, losing homes etc. (Now, in some instances, it could be bad enough that productivity was seriously compromised, there wasn't enough food to go around etc.)

If we badly manage the aftermath, it could be that some people are impacted far more than is needful, though, which is what most people are fearful of.

Though - people in my experience don't think of it in terms of productivity, and I suppose that may be related to capitalism which tends to see value in terms of what people will pay, not productivity, in fact that may be a necessary condition of capitalism. So perhaps capitalism is part of the problem.