The Magazine

Reveling in the Financial Crisis

Naomi Klein, rising star of the kooky left.

Mar 30, 2009, Vol. 14, No. 27 • By CATHY YOUNG
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Thus, Klein seeks to link Friedman to the dictatorship of Augusto Pinochet in Chile and to demonstrate that imposing Chicago School reforms was the real agenda behind the 1973 coup. But in making this argument, Norberg shows, she fudges the fact that economic liberalization was initially opposed by the junta and began only several years later.

Particularly devastating is Norberg's dissection of Klein's attempt to recast the 1989 Tiananmen Square protests in China as an anticapitalist uprising. In reality, the protesters' demands focused on political issues, particularly free speech; the participants included both supporters and opponents of market-oriented economic reform. Among Communist party elders, most of those who sent in the tanks to crush the peaceful demonstration opposed economic liberalization, which they blamed for the unrest--while the strongest supporter of market reforms, General Secretary Zhao Ziyang, was sympathetic to the protesters. (After the crackdown, Zhao was deposed and placed under house arrest.) While Klein portrays the Tiananmen massacre as a means of terrorizing the populace into submission to radical market reforms, Norberg points out that reforms were actually stalled for several years afterwards.

In September, Klein posted a response to her critics on her website--demonstrating in abundance the very sins that those critics have pointed out. Norberg charges that Klein cherry-picks data to support her claim that free-market reforms cause impoverishment; in reply, Klein cites more cherry-picked data on unemployment and poverty in several countries in various years. Both Norberg and Chait accuse Klein of lumping together her villains under the catch-all label "neoconservative." Klein retorts that she never applied this label to Friedman--and then goes on to quote a passage from her book that lumps together the Heritage Foundation, the American Enterprise Institute, and the Cato Institute as leaders of the "neoconservative" movement. Of course, Cato (where I hold an unpaid position as a research associate) is in no sense "neoconservative" and forcefully opposed the war in Iraq, which Klein sees as the ultimate application of "the shock doctrine."

Economist Anders Åslund of the Peterson Institute told me in an email exchange that Klein's "favorite trick is to take a brief quotation out of context and make it mean the opposite of what the writer or speaker meant"; and that, too, is on display in Klein's attempted self-defense. To back up her claim that NATO military action in the former Yugoslavia was intended primarily (you guessed it) to force the new nations of the Balkans to submit to Friedmanism, Klein calls as her witness former Deputy Secretary of State Strobe Talbott. In a foreword to a 2005 book on the Balkan crisis, Talbott wrote, "As nations throughout the region sought to reform their economies, mitigate ethnic tensions, and broaden civil society, Belgrade seemed to delight in continually moving in the opposite direction.  .  .  . It was Yugoslavia's resistance to the broader trends of political and economic reform--not the plight of the Kosovar Albanians--that best explains NATO's war."

If you're wondering how this proves Klein's point, the answer is that it doesn't. Obviously, Talbott is referring to the Milosevic regime's general rejection of Western values, among them ethnic diversity and political freedom; moreover, in the next paragraph he adds that "only a decade of death, destruction and Milosevic brinksmanship pushed NATO to act." Yet the mere mention of economic reform is enough to trigger Klein's monomania. Ironically, Talbott also points out that most leaders of NATO powers were not right-wing hawks but heads of "socially progressive, economically centrist governments"--an observation that reads like an eerily prescient rebuttal to Klein.

The Shock Doctrine's account of economic and political reform in Russia is a striking example of fuzzy facts and muddled thinking. In Klein's telling, nascent Russian democracy was sacrificed on the altar of the market--by Boris Yeltsin, when he shelled the rebellious Russian parliament to crush its, and the people's, resistance to his radical free-market reforms. Klein compares this event to Pinochet's coup.

There are a few things wrong with this narrative. First, at the time of the showdown with parliament in October 1993, Yeltsin was hardly a champion of radical economic reform: In December 1992, he had replaced his pro-market prime minister, Yegor Gaidar, with "centrist" Viktor Chernomyrdin, a career bureaucrat with strong links to the Soviet-era industrial sector who quickly began pumping money into moribund enterprises, causing hyperinflation.