(C) Daily Kos This story was originally published by Daily Kos and is unaltered. . . . . . . . . . . Economics Books: The Shock Doctrine, Part 1: Chile [1] ['This Content Is Not Subject To Review Daily Kos Staff Prior To Publication.'] Date: 2024-05-04 The Shock Doctrine: The Rise of Disaster Capitalism, by Naomi Klein, is a huge and wide-ranging book, focused on the disasters arising from Milton Friedman’s Market Fundamentalism, applied in countries around the world from Chile to, yes, the US. I am going to take it here in chunks, not all at once. Chunk one is Friedmanite Market Fundamentalism, as applied in the coup and assassination against Salvador Allende, and all of the other torture, murder, and economic calamity involved. Then we have dozens of other countries dragooned into Market Fundamentalism via CIA-sponsored coups and other underhanded means, plus the numerous oil and cobalt and other resource wars. Iran Brazil Indonesia Afghanistan Iraq Syria Congo Israel/Palestine and on and on and on. The Shock Doctrine (ENGLISH) - FULL DOCUMENTARY : The Rise of Disaster Capitalism The story starts with a wide-ranging US business/government conspiracy to undermine Chile’s economic system by educating Chileans in orthodox Chicago School/Friedmanite Market Fundamentalism. Third world nationalism was the first step on the road to totalitarian Communism. Two of the chief proponents of this theory were John Foster Dulles, Eisenhower’s Secretary of State, and his brother Allen Dulles, head of the newly created CIA. Their first “successes” were the coup in Iran to overthrow a freely-elected government and reinstate the brutal Shah, and the coup in Guatemala undertaken at the behest of the United Fruit Company. The two men came up with a plan that would eventually turn Santiago, a hotbed of state-centered economics, into its opposite—a laboratory for cutting-edge experiments, giving Milton Friedman what he had longed for: a country in which to test his cherished theories. The goal was of the Chile project was to produce ideological warriors who would win the battle of ideas against Latin America’s “pink” economists. They became known in Chile as Los Chicago Boys. But the plan failed. They gained no traction in the economic or political discourse in Chile. Cue two more coups, in Brazil and Indonesia. Enter Richard Nixon and Henry Kissinger. Nixon famously ordered [his] CIA director, Richard Helms, to “make the economy scream” The campaign of corporate sabotage, spearheaded by ITT [did] an effective job of sending the [Chilean] economy into a tailspin. Now we come to the Chilean business community and military turning to the CIA and the Chicago Boys for help, part of which came in the form of a 500-page economic plan for total Friedmanization informally known as El Ladrillo (The Brick). Chile’s coup, when it came, featured three different forms of shock. The coup, with vast targeted killings Friedman’s “shock treatment” of slashing government outlays, and privatizing government enterprises, both as fast and hard as possible Actual shock, along with drugs and other forms of torture from the CIA KUBARK manual All of this played out over and over again around the world, but most notably after 9/11, and in the Forever Wars in Afghanistan and Iraq. In a predictable but nevertheless astonishing display of Cognitive Dissonance, the forces of Shock and Awe never recognized any of their failures, but continued to double down at every opportunity. A Protest Hay una Mujer Desparecida—Holly Near & Ronnie Gilbert Back to the Horrors Milton Friedman - Pinochet And Chile This begins with a flat lie, I never advised Pinochet. and proceeds to his usual horse hockey, claiming that the program was a huge success in Chile. Friedman was greeted by the junta-controlled press as something of a rock star; the guru of the new order. Each of his pronouncements made headlines, his academic lectures were broadcast on national television, and he had the most important audience of all: a private meeting with General Pinochet. He used a term that had never before been publicly applied to a real-world economic crisis: he called for a “shock treatment.” The Shock Doctrine Friedman literally compared his plans to brain-destroying ECT, electroconvulsive “therapy”, originally introduced in total ignorance of the disorders it was meant to treat and its effects on the brain. Chicago Boys After the coup when the Chicago boys were given power and El ladrillo was implemented, the Chilean GDP fell by about 15% by 1982 and government spending increased slightly. In addition, this has led to greater income inequality in Chile, which still impacts the country today.[8] References Non-Fiction Program for Economic Development The Brick/El Ladrillo (PDF) in Spanish. I know of no English or other translation. Fortunately I can read Spanish myself. El país está cansado de imposturas. The country is tired of impostures. Oh, these Boys had no idea how true that would turn out to be. But little could be done about it until Pinochet died. The Brick plan quickly revealed itself to be what we can call Stalinism-Putinism under Pinochet, not free markets in any form. Where the Chicago Boys had complained that the Allende government could act without restraint, their recipe for fixing it was to remove all restraints on Pinochet with regard to politics, law, society, and the economy, and to give away vast powers to oligarchs and foreign multinationals. The Chile Project: The Story of the Chicago Boys and the Downfall of Neoliberalism Andre Gunder Frank This is a critique, written in the form of an open letter, of the economic policies of the military Junta in Chile. The Junta's economic programme consists of freeing almost all prices to raise them several-fold to 'world levels' and increasing the money supply concomitantly. A 'free' capital market is fostered as well, which beyond concentrating capital into conglomerates also creates its own financial instruments above and beyond the control and even the accounting of the state, and which at the same time increases the amount of monetary means of payment and their velocity of circulation. Both of these 'freedoms' generate a runaway inflation whose consequences, and intended effects, are to shift income and wealth from labour to capital and from smaller to bigger capital. Fortifying the same process to the same effect still further, 'freedom' must be promoted by destroying or yellow-dog-co-opting the organisation of labour and eliminating its bargaining power, and through all means preventing money wages from keeping pace with inflation in both private and public employment. In short, real wages are drastically reduced by bringing prices but not wages to 'world' levels. At the same time, the state divests itself of state sector enterprises at bargain basement prices to Chilean and particularly to foreign big capital, doing so not only with enterprises that became state-owned or controlled under the Allende government, but also with enterprises that had been financed through state investment for over a generation. Similarly, a crash programme of agrarian counter-reform is instituted and some 2 million hectares of land expropriated during the Allende and Frei administrations is returned to their former owners and/or to new capitalist owners, while repressing and exploiting the peasantry and rural labourers even more brutally than the urban population. Not only wages but also employment and expenditures in the public sector are cut back and much of the most advanced social security and public health system of Latin America (outside of Cuba) is turned into a private pay-as-you-go business. In the 'external' sector, there is repeated devaluation, tariffs and other import restrictions are relaxed and every kind of favour is extended to foreign capital, including payments to the American copper companies in excess of the values of their former properties. The balance of payments is redressed by reducing imports of goods necessary to meet the essential consumption needs of the population, while exporting manufactures and even food products that the consumer's reduced purchasing power no longer permits them to buy. Production is restructured and investment is redirected to permit the still greater promotion of 'non-traditional' exports of food, raw materials and manufactures at the expense of the Chilean consumers, whose most essential needs are sacrificed more and more by an intentional, calculated and forcibly imposed policy of economic genocide. Two Lucky People: Memoirs, by Milton and Rose Friedman. Recounts Friedman’s meeting with Pinochet. Letter to President Augusto Pinochet During our visit with you on Friday, March 21, to discuss the economic situation in Chile, you asked me to convey to you my opinions about Chile’s economic situation and policies after I had completed my visit. This letter is in response to that request. If this shock approach were adopted, I believe that it should be announced publicly in great detail, to take effect at a very close date. The more fully the public is informed, the more will its reactions facilitate the adjustment. Herewith the sample proposal: Such a shock program could end inflation in months, and would set the stage for the solution of your second major problem--promoting an effective social market economy. Some forty years ago Chile, like many another country, including my own, got off on the wrong track—for good reasons, not bad, because of the mistakes of good men not bad. The major error, in my opinion, was to envision government as the solver of all problems, to believe that it is possible to do good with other people’s money. Kubark Counterintelligence Interrogation: The CIA Document of Human Manipulation, by Central Intelligence Agency Chapter IX is about “Coercive Counterintelligence Interrogation”. The FBI has explained that this is vicious and illegal nonsense, in comparison with its own proven effective techniques of befriending subjects of interrogation. Peter Kornbluh, The Pinochet File The Decisive Day (El día decisivo, 11 de septiembre de 1973), by Augusto Pinochet, about the coup Fiction The Cold Cash War by Robert Asprin The Cold Cash War is a 1977 science fiction novel. The story takes places in a dystopian near-future in which enormous corporate cartels compete in the military as well as economic spheres. The protagonist is major Steve Tidwell, a veteran mercenary who is hired by a new entrant to the conflict, a conglomerate of major Japanese businesses known as the Zaibatsu, who wish to train their own strike force to Western standards. 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