dougo: (Default)
([personal profile] dougo Sep. 24th, 2004 03:40 pm)
In a fascinating article in the September issue of Harper's Magazine, Naomi Klein refutes the common wisdom that the Bush administration didn't have a plan for post-war Iraq. In fact, she claims the plan all along was to use the blank slate of an occupied Iraq to play a giant game of SimCity based on neo-conservative econo-political ideology, i.e. free-market capitalism and privatization unhindered by taxes, tariffs, regulation, or any other state influence. Unfortunately I can't fully agree with her conclusion that "in trying to design the best place in the world to do business, the neocons have managed to create the worst, the most eloquent indictment yet of the guiding logic behind deregulated free markets." I don't think (based on the evidence presented in the article) that their failure is necessarily due to faulty principles, but more to gross incompetence and self-defeating blind spots. Importing concrete blast walls for $1000 when they could be made locally for $100 does not seem to follow from any capitalist notion; it's either sheer ignorance and mismanagement, or some sort of inverted xenophobia, a belief that putting any money into the hands of Iraqis must be a bad thing. Still, even if you discount her apparent biases against capitalism (which she reduces to "greed is good") and globalization (her caricaturized references to the "men in dark blue suits" from the IMF), it's a compelling and tragic story of the failed reconstruction of Iraq.

From: [identity profile] greyaenigma.livejournal.com


it's either sheer ignorance and mismanagement...

Or simple war profiteering. Similar to not wanting the Iraqis to get more, but more along the lines of making sure big campaign financers got theirs.

From: [identity profile] dougo.livejournal.com


I don't think cement factories in Kurdistan and Turkey count as big campaign financers.

From: [identity profile] mshonle.livejournal.com


I wouldn't say that the economic ideology you've described is "neo-conservative." Neo-conservatives are more the people who are foreign policy hawks, but are less concerned about "small government". So, yeah, the Iraq war was fueled by neo-conservative ideology (you'll find a pattern that those who favor Israel like-a-hawk also supported the Iraq war), but the SimCity idea doesn't fit.

I'd say it would actually be a very rare breed of conservative who wanted both the Iraq war and a completely deregulated economy. Current conservatives are more motivated by their hawkish stance, handouts to their corporate friends, and maintaining control out of mistrust of the left. The modern conservative doesn't object to big government, just as long as they are part of it.

From: [identity profile] dougo.livejournal.com


I don't think "big government" has to include market regulation. I think neocons are definitely anti-regulation, but they also support government spending when it's for the security of the free market. Where they differ from traditional conservatives is that they don't care about the deficit, or at least feel that it's a price worth paying for security.

From: [identity profile] mshonle.livejournal.com


You would think before writing about conservatives so negatively she would have studied their positions better. She gets the neocon definition (which, I agree, is not a clean one) messed up.

I agree with you: The disaster in Iraq (and all of those thousands of innocent civilian lives lost) is not due to too-low tariffs or because the free-market-on-paper laws were bad, it was because it was an ill conceived war and no laws, no matter what they were, could be enforced. For example, looting violates property rights, which is essential for a capitalist system to function. And we did basically nothing to stop that looting. I think it's disingenuous (of the author of the article) to even pretend that we can blame capitalism on a war that shouldn't have even been fought. It would have been better to bash the mismanagement of the administration than to bring out the old axe to grind against free markets.

From: [identity profile] jfb.livejournal.com


I haven't read the article, and I'm tired, but ignorance and exhaustion make the best LiveJournal comments.

The guiding logic behind free-market capitalism is a sort of pure theory: In the absence of state intervention, and assuming rational actors, the market will achieve optimal efficiency. Importing goods for ten times their local value is stupid and irrational... and the sort of thing that *will always happen*. There's your indictment of free-market theory: It only works in simulation.

And then there's no-bid contracts to administration cronies widely known for their inability to meet budgets. State intervention at its finest.

From: [identity profile] dougo.livejournal.com


I don't think pure capitalism assumes rational actors; in fact, it punishes irrational actors, because irrationality is inefficient—in the long run. The problem is that short-term thinking can produce short-term gains, and it's human nature to discount long-term losses. It's in everyone's long-term interest to create an economically stable Iraq, but it's in some companies' short-term interest to loot and pillage while they have the opportunity.

From: [identity profile] dougo.livejournal.com


I should add that I was being a bit disingenuous about the imported blast wall thing. According to a footnote in the article, the purported reason for avoiding local companies is to decrease their value so they can be taken over more cheaply. So it's not as stupid as it appears, but I do think it's still irrational considering the big picture.
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