Hurricane Sandy: beware of America’s disaster capitalists

Guardian, By Naomi Klein

Less than three days after Sandy made landfall on the east coast of the United States, Iain Murray of the Competitive Enterprise Institute blamed New Yorkers’ resistance to Big Box stores for the misery they were about to endure. Writing on Forbes.com, he explained that the city’s refusal to embrace Walmart will likely make the recovery much harder: “Mom-and-pop stores simply can’t do what big stores can in these circumstances,” he wrote. He also warned that if the pace of reconstruction turned out to be sluggish (as it so often is) then “pro-union rules such as the Davis-Bacon Act” would be to blame, a reference to the statute that requires workers on public works projects to be paid not the minimum wage, but the prevailing wage in the region.

The same day, Frank Rapoport, a lawyer representing several billion-dollar construction and real estate contractors, jumped in to suggest that many of those public works projects shouldn’t be public at all. Instead, cash-strapped governments should turn to public private partnerships, known as “P3s” in the US. That means roads, bridges and tunnels being rebuilt by private companies, which, for instance, could install tolls and keep the profits. These deals aren’t legal in New York or New Jersey, but Rapoport believes that can change. “There were some bridges that were washed out in New Jersey that need structural replacement, and it’s going to be very expensive,” he told the Nation. “And so the government may well not have the money to build it the right way. And that’s when you turn to a P3.”

The prize for shameless disaster capitalism, however, surely goes to rightwing economist Russell S Sobel, writing in a New York Times online forum. Sobel suggested that, in hard-hit areas, Federal Emergency Management Agency (Fema) should create “free-trade zones – in which all normal regulations, licensing and taxes [are] suspended”. This corporate free-for-all would, apparently, “better provide the goods and services victims need”.

Yes, that’s right: this catastrophe, very likely created by climate change – a crisis born of the colossal regulatory failure to prevent corporations from treating the atmosphere as their open sewer – is just one more opportunity for further deregulation. And the fact that this storm has demonstrated that poor and working-class people are far more vulnerable to the climate crisis shows that this is clearly the right moment to strip those people of what few labour protections they have left, as well as to privatise the meagre public services available to them. Most of all, when faced with an extraordinarily costly crisis born of corporate greed, hand out tax holidays to corporations.

The flurry of attempts to use Sandy’s destructive power as a cash grab is just the latest chapter in the very long story I have called the The Shock Doctrine. And it is but the tiniest glimpse into the ways large corporations are seeking to reap enormous profits from climate chaos.

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