Sunday, July 6, 2008

Naomi Klein's misguided understanding of capitalism

Normally I wouldn't waste time trying to debunk Naomi Klein, but her use of the term "capitalism" to describe decidedly statist policies has really been getting to me lately. In an article for The Nation called "Disaster Capitalism, State of Extortion" she again pulls what I like to call "pulling a Naomi Klein" – she berates the Bush administration for its obeisance to markets, admits that it's interfering with markets, and concludes capitalism is therefore the problem. The article is a bit schizophrenic (but then again, when are here thoughts not?), but focuses on three main issues: oil in Iraq, oil in Anwar, and the food crisis.

On Iraqi oil, apparently she thinks that no-bid contracts are the paragon of capitalism, and even that these uncompetitive contracts "will raise more money" – but how handing over concessions to a company without looking for higher bidders will raise more money, she never explains. Furthermore, she never explains why a capitalist – that is, someone with a single-minded drive for profit – wouldn't put a contract out for competitive bidding. On Anwar she makes a little more sense, saying that the resources up there are miniscule compared to the global market for oil.

But on food prices, she again loses it. Despite a leaked report by the World Bank that says the rises in food prices are largely due to pro-ethanol, anti-capitalist state intervention in agriculture, she conveniently ignores the fact that capitalism is obviously the solution to the food crisis, not the problem (Raționalitate on food here). She goes on a little rant about genetically modified crops, saying "there is no evidence that GMOs increase crop yields, and they often decrease them." This might be true (though I kind of doubt it), but if it were, then what's the problem? Has the Bush administration been forcing farmers to use GM crops? If they're so ineffective, then wouldn't those greedy profit seekers not use them? And in the same breath that she deprecates GM crops, she berates corporations for patenting those oh-so-ineffective crops and depriving others of their use. Although attacking intellectual property as it relates to food genetics is certainly justified, she implicitly associates intellectual property with a free market agenda, despite the divide among libertarians on whether IP is justified (and, hence, whether or not it qualifies as "capitalist"). Those who come out (to some degree or another) against IP range from the traditionally libertarian to the hard-core anarcho-capitalists (not to mention myself), though you'd have no way of knowing that from her article.

Naomi Klein almost always has legitimate points, but she's often profoundly confused about the difference between capitalism and statism. What she calls "disaster capitalism" (a favorite topic of hers – she even wrote a book about it) is more accurately termed state capitalism, but don't count on Naomi to be able to discern distinctions so subtle.

Edit: Cato actually has a takedown of Klein's aforementioned book here if you're interested – I haven't read her book, and I've only skimmed this article, but from what I've read of Klein's, debunking her is a job that anyone with half a brain could do pretty well.

No comments: