Panic for profit: Shock doctrine redux

Panic for profit

by digby

Lot's of people are talking about this piece by Martin Wolf, particularly this part:
Before now, I had never really understood how the 1930s could happen. Now I do. All one needs are fragile economies, a rigid monetary regime, intense debate over what must be done, widespread belief that suffering is good, myopic politicians, an inability to co-operate and failure to stay ahead of events. Perhaps the panic will vanish. But investors who are buying bonds at current rates are indicating a deep aversion to the downside risks. Policy makers must eliminate this panic, not stoke it.
It seems to be what they do. After all, the same thing happened after 9/11 and we ended up invading a country that hadn't attacked us.A crisis hits, and everyone loses their minds and behaves in seemingly counterproductive ways. Only later does it become clear to everyone that they simply used the opportunity of a crisis to create a panic so they could do what they'd wanted to do anyway, but for which they didn't have political support.

I'm always reminded of this from the neo-conservative outfit, Project For A New American Century's paper back in 2000 called "Rebuilding America's Defenses: Strategy, Forces and Resources for a New Century":
"the process of transformation, even if it brings revolutionary change, is likely to be a long one, absent some catastrophic and catalyzing event -- like a new Pearl Harbor."
The political, financial and military elites may not consciously create the "opportunity" that comes from a panic, but they are certainly ready to exploit it.

See also: The Shock Doctrine