About Naomi Klein and that Shock Doctrine

Naomi Klein took a point that Milton Friedman made and turned it into a conspiracy. The point being made was that when a crisis arrives and people muse on what might be done better, differently, then the what is going to be determined by the ideas that are floating around at the time.

Klein morphed this into a conspiracy by neoliberals - that’s people like us - to impose freedom, liberty and wealth onto people whether they wanted it or not.

Now we have another crisis and we can see that Friedman was right. There are armies out there, all waving the little plans they’ve long had and insisting they are the solution to this specific problem. One example being John McDonnell:

We pay for it by introducing an immediate windfall tax on the banks and finance sector that we bailed out when they brought about the crisis more than a decade ago. Combining this with a wealth tax on the richest within our society and a tax on multinationals, we can demonstrate – just as the current government has demonstrated – that when we need the resources, they can always be found.

Coronavirus here is simply an excuse for McDonnell would recommend those three sets of taxation to cure hangnails. The same is true of the latest Saez and Zucman proposal:

This column proposes the creation of a progressive, time-limited, European-wide progressive wealth tax assessed on the net worth of the top 1% richest individuals.

Saez and Zucman have been proposing a progressive wealth tax to solve such minor problems as Elizabeth Warren’s political career. Coronavirus is again just an excuse to hang it upon.

St Milt was right, reactions to crises do come from the ideas that are floating around when the problems hit. Our task as a society more generally is to sort through those ideas to see if they actually would solve the problem that caused the crisis.

At which point we can reject taxing wealth of course. For what is the very definition of an economic slump? That wealth has diminished. Given that we’re not actually homeopaths, thinking that more of what causes the problem cures it, we can thus reject the idea.

Perhaps a better idea would be to observe what has been happening in response to current events. Bureaucratic limitations upon the economy have been lifted because they hinder action. Very well then, let’s not hobble ourselves by reimposing such hindrances then.