The Schlock Doctrine

The MacDoctor has noted that Cactus Kate is somewhat irritated by the people at the Standard, notably one Marty G. She writes:

““I’m really pissed off that politics has come into the Christchurch earthquake so quickly”. (Quote from Marty G)

“Really? You are having a laff? The whole post titled “The Shock Doctrine” was political and anti-government.”

 

And

“I call on all centre-right blogs to take these arsewipes head on and debate the issues because they are ALL about politics.”

No problem, Kate. Happy to write about a proper political response to the Christchurch Earthquake.

Let’s start with The Shock Doctrine, the book that Marty G and The Idiot at No Right (At All) Turn cite as evidence of the Evil John Key plan to rule the universe make radical changes to NZ. For those unfamiliar with Canadian Journalist Naomi Klein’s Magnum Opus, the book posits the theory that Milton Freidman and his Neoliberal acolytes have used disasters to advance their radical right wing agendas over the past 30 years. Naturally, the book became part of the left wing canon and was, indeed, the text to quote in lefty circles for a couple of years – until it was superceded by the New American Standard version; otherwise known as The Spirit Level.

Personally, I found Ms Klein’s book annoyingly superficial for such a large tome. Lots of lurid examples and precious little decent analysis. One has the sensation of drowning in anecdotes while being shoehorned into a thesis that is, at best, highly dubious. Ms Klein seems not to have realised that politicians have been using disasters for their own ends since the dawn of time. She also seems not to have noticed that left-wing politicians use disastrous events, real and imagined, in exactly the same way. I await a book entitled the Rise of Disaster Socialism with bated breath.

Perhaps the most obvious flaw in the book, though, is the assumption that everything that “Neoliberals” try is bad and everything that Socialists want to do is good. This is the assumption that underlies Marty G’s following statement:

“I’m really pissed off that politics has come into the Christchurch earthquake so quickly. But make no mistake, the Nats are pursuing a strongly ideological agenda. They’re using the quake as cover for radically cutting important policies and making other extreme decisions, while preserving the tax cuts for the rich. It’s called the Shock Doctrine.”

Leaving aside the hypocrisy of complaining about a political agenda when nearly every post from the Standard since the Quake has been heavily political and critical of government, it seems to have escape Marty G that preserving WFF and Student loans in the face of Christchurch’s pressing need – and that the mantra tax cuts for the rich - are both about as ideological as you go. I confess to being somewhat bemused by the strange insistence that the current duly-elected government should follow the opposition’s ideology, rather than their own. Not only that, but I do not see that National’s suggestions so far can be truly described as radical or extreme. I would have thought subdued is a better description. Real Neoliberals would call it Shlock.

Be that as it may. Let’s take a look at the primary suggestion of Marty and The Idiot – increasing taxes (Oh, what an original idea!).

Firstly, let me say at the outset that I do not buy the “temporary” tag that the “disaster levy” is being marketed with. Apart from the fact that governments, particularly socialist ones, do not like to relinquish taxes once they have acquired them, one has to understand that a disaster of this magnitude requires funds for many, many years (at least 10, in Christchurch’s case). All events of this nature run through three stages:

1. Relief/Rescue – Measured in weeks. Consists of emergency aid and services. Relatively cheap and adequately managed with charity and some government aid.
2. Recovery/Restructuring – Measured in Months. The return of normal function by working around lost infrastructure. Moderately expensive and mostly financed by insurers.
3. Restoration/Rebuilding – Measured in Years. The rebuilding of infrastructure and buildings. Very expensive and almost entirely financed by insurers.

The only reason why a government would consider a levy or a new tax is because it is contemplating becoming involved in the second and third stages of disaster recovery. Unfortunately, one has no real idea where one can safely end this involvement, once begun. Hence the tax is unlikely to be a limited one. Therefore John Key’s concern that the tax may slow the economy is a real one. This is not some once off levy, but a commitment to spend billions of dollars for many years.

Do not mistake me here. I am not suggesting for a moment that the government should not be involved in the rebuilding of Christchurch. I just do not think that the government needs to supply great piles of tax dollars for this purpose. A figure of $15 billion has been bandied about, but the vast majority of this should be coming from insurances – with the lion’s share from the EQC. The priority, therefore, is to restore the EQC fund as quickly as possible. Clearly this should be funded by the EQC levy rather than general taxation.

I am aware that many will not have insurances on their properties. At the risk of sounding harsh, this is NOT the government’s problem. In particular, the government should not become the default insurer for those who forewent insurance. Apart from the precedence this would set, it is manifestly unfair to expect people who have already paid their insurance premiums to not merely pay someone else’s premiums, but to pay for their claims. This would not only undermine the insurance industry, it would mean that people are being coerced into accepting other peoples risk after the fact.

It is already inevitable that the government is going to have to fund the rebuilding of some basic infrastructure in Christchurch. It is unlikely that the Christchurch town council is sufficiently insured for this purpose and it is unreasonable to expect the people of Christchurch to fund this themselves anytime soon. But this does not have to be directly funded out of new taxes. The amount required will almost certainly require nothing more than delaying a couple of motorway projects for a year or so. This should make the Greens happy, once they get over their high dudgeon over not being able to increase taxes.

I have given money towards Christchurch’s need and I will continue to do so. I do not need the government to do this for me. The government would remove my choices of how often and how much I may give and my choice of where and for what I donate. I addition, it will most likely waste at least 3 of every 10 dollars I give in “churn”. All in all, I can think of no reason to initiate an earthquake levy, beyond the usual left-wing desire to soak the “rich”.

And, if that is not pure ideology, then I don’t know what is.

Related posts: