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GDS Chapter Three

CHAPTER 3: Courting Catastrophe and Sabotaging Everyday Security: Neoliberalism's Dangerous Dance

About the reading notes: These are not intended as a substitute for reading the book itself. If you read only the reading notes and not the book you will miss a great deal. The reading notes also do not attempt to discuss all of the important points. The notes approach selected major points from slightly different angles of approach than the book does, thus providing another way of looking at the material. Generally speaking, the notes approach the chapter material from a meta-level, that is, one step up from the text, commenting on its significance and providing some supplementary commentary and material to that of the book.

The book itself is written in a highly accessible manner so that anyone can read it and learn a great deal, but the content is quite complex and very sophisticated. A lot is going on within any given sentence and paragraph and there are many layers of meanings and inter-connections being made, so readers will find it helpful to use these notes in getting more from the book. To get the most out of this book, pay especial attention to the way that Loo uses theory as a means of illuminating what is beneath the surface appearance of things and how seemingly disparate developments are in fact part of a larger pattern.

These notes were compiled by a writing team of students who have read and discussed the book. Their notes were reviewed and added to by Dennis Loo.

In Chapter Three Loo pursues a theme previewed in Chapter One:

What has not been well explored [in other books about neoliberalism] is what these dramatic economic changes imply with respect to social control and to the matter of the stability of the social order and the heightened probability of violent reaction/counteraction. (p. 53)

The material covered in this chapter is more extensive than any other chapter in the book. What other books on neoliberalism emphasize is the widening gaps between the rich and the rest and in some cases the environmental consequences of this. They do not in general address, however, the impact on social order that neoliberal policies have and they do not tie this all into the role of the "War on Terror" and the less well-known and understood transformation in the laws that have been underway with the rise of public order policies. These seemingly separate developments are in fact intimately intertwined. The fullness of Loo's arguments and some of this chapter's evidence do not show up anywhere outside of this book - at least so far. Yet the implications of what he's analyzing and pointing to are extraordinarily important.

The question of an unstable social order and the greater likelihood of violence arises because social inequality grows tremendously under neoliberal policies. Thus, the probability that the public will resist the relentless growth in the ranks of those who are being deprived of opportunity and the very means to life correspondingly grows. Authorities' ability to maintain social stability when the material basis for social stability is being undermined across the board by their policies poses itself as an acute and ever-expanding problem. The increasing occurrence of popular upheavals and authorities' use of force to prevent and put down rebellions and revolutions are both therefore to be expected.

To discuss social control and social order Loo shows that we have to first and foremost understand the nature of state power and the role of force and the question of legitimacy in organizing human communities. Loo explains why the conventional view about what politics, political power, and policy-making consist of is mistaken and misleading. He puts this into historical context, showing that governments have not always been part of human societies and in fact have only been in existence for a tiny fraction of humanity’s existence, only appearing when there was an economic surplus. Loo contends that “states exist because classes exist,” and that state creation is a response to an economic surplus. In order to protect elites' control over the economic surplus from others, Loo argues, they had to start using weapons, build up a specialized group of armed enforcers, set up territorial boundaries to maintain their privileges and protect their ability to command the means of production (the means of survival). Because states have not always existed, Loo argues, we can anticipate that they will not always continue to exist.

Persuasion and coercion (force) are the twin pillars of power that any individual or group uses to hold political power; they are what make a government a government. Without either of them no entity can exercise political authority. Persuasion is the ability to convince others that you have a legitimate right to exercise political power over them. Coercion is the ability to get others to do what you want them to do when persuasion fails and they don’t want to do it.

Since consensus about what should be done is virtually impossible, some people’s desires must be overruled if people are to operate as a group. This was true even before there were governments and it will be true into perpetuity. When in addition to this baseline fact, society’s existing economic organization favors a small fraction at the majority's expense in a zero sum game (winners and losers), then political power’s hard core can only be coercion and persuasion’s role must rest heavily or even exclusively upon deception. If it did not, then there would be no way that a small group could prevail over the majority’s wishes and needs because the majority would simply come and take what they regard as theirs from the small group that is monopolizing those resources. The only way to stop the majority from doing that is for the small privileged group to use force and threaten the use of force. In addition, as an important adjunct to that use of force, the privileged group must persuade as many as it can that the privileged group's privileges are deserved and not illegitimate. They must, in other words, engage in widespread and constant deception. 

The development of human society always has been and will continue to be marked by necessity and coercion, manifested in many different ways, including the tension and mutuality that exists between the individual and the group (a point discussed at length in the Introduction and Chapter One). As the conditions between people in the developing world and people in the U.S. become more polarized in the midst of environmental racism, lack of clean water and food, occupation for empire, etc., these necessities will become even more aggravated. However, contrary to popular understanding, transforming these necessities into freedom does not happen by exercising some "free will" that is independent from the material conditions we find ourselves in. This is where coercion and persuasion in various forms come in. For instance, in any future society, even as we are going to be trying to transcend economic relations and move beyond "the narrow horizon of bourgeois right," there are still going to be people who are going to be driven to contribute to moving society forward through economic incentives such as money. This is a contradiction that won't be resolved by simply thinking that it is best to have people choose what is best to do at any given moment or by merely forcing people into line. In the first instance, the idea of just letting everyone "do their thing" promotes capitalism’s “me, myself and I” mentality which if left alone would produce widening rather than narrowing differences among the people and eventually bring back the old capitalist relations of exploitation. There is then going to need to be a lot of ideological struggle to better understand what is motivating people and whether this is the correct way of addressing people's needs in ways that move society forward. Some people are going to be persuaded and convinced that there is another way forward in the process of being struggled with.

Loo goes on to show how the welfare state has been replaced by what he dubs the security state (aka neoliberal state) and how contrary to the Republican Party’s rhetoric about wanting to reduce the state's size and role, they and the Democrats have been actually expanding the state but doing so by privatizing many of its functions, including the use of force being farmed out to private entities such as Xe (formerly known as Blackwater). Government expenditures have in fact been rising under both the GOP and the Democrats as many of these functions are costing more to run through private entities than when they were being done directly by the government. The anti-government rhetoric of both parties, then, is really a shell game meant to deceive the public and to scapegoat the “big bad government” for the undesirable impact of neoliberal policies on the public.

Loo’s discussion based upon the preceding in the book might be summarized this way:

Neoliberals’ hubris and monopoly over state power, their control over resources (both material and ideological), the potency of contemporary technological capacities, and their startling indifference to their policies’ rupturing of the social fabric and endangering the biosphere make them an unparalleled threat in human history.

The most dangerous aspect of this is not what Naomi Klein’s Shock Doctrine exposes, that neoliberals are deliberately triggering disasters, as bad as that is. Loo shows that the problem is more fundamental and damaging than that: it arises from the very nature of capitalism/imperialism and neoliberalism in particular:

The worst and most alarming news here . . . is not that 9/11 was an inside job, a grand conspiracy hatched within the highest US government echelons. It is instead that 9/11 and other disasters such as the BP Deepwater Horizon catastrophe are due to the normal and ordinary workings of capitalism, and specifically neoliberal policies. That is much more distressing than believing that 9/11 was an inside job. (p. 163)

This goes deeper, then, than the individuals in charge. It grows out of the dominant systems in place and can only be resolved through a revolutionary systemic change.

Nathan Freier, a DoD analyst, reaches similar conclusions to Loo about the dangers here, even though he approaches this from an entirely different perspective. As Freier puts it,

The likeliest and most dangerous future shocks will be unconventional… Their origin is most likely to be in irregular, catastrophic, and hybrid threats of ‘purpose’ (emerging from hostile design) or threats of ‘context’ (emerging in the absence of hostile purpose or design). Of the two, the latter is both the least understood and the most dangerous.” (Bodfacing added, pp. 133-134.)

The paradox here is that the rhetoric of prosperity and emphasis on security and the measures enacted to supposedly ensure the public welfare and security are doing the very opposite: the security state rests upon a system and policies that are the greatest source of instability in the world today. The “war on terror” (WOT) in particular employs state terror and feeds a cycle of great violence, both on the individual level and on the societal level. The WOT is itself only a particular product as well as virulent expression of the neoliberal world:

[T]he forces insisting that order is under siege and that repression and extralegal measures are necessary to cope with that disorder are the same forces creating disorder in the society by dispossessing increasing ranks of the people, endangering the planet’s biosystem, and provoking greater and greater levels of social insecurity. (Boldfacing added) (p. 153)

Loo uses many different examples to show how this is operating.

The Occupy Movement worldwide (which began a month after Loo’s book was released) and the grievances that participants cite are an illustration of the popular response to this ever-widening dispossession.

Corporations operate on the logic that it is cheaper to pay for lawsuit claims against them for wrongful death and injury due to their ignoring or under-responding to safety issues than it is to carry out their businesses with the safety and welfare of the public and environment in mind. Under neoliberal logic, businesses, especially big business, are allowed to now largely self-police rather than being regulated. Since self-policing works as well as any other unsupervised activity (not well!), the normal course of business and governmental decisions are now fraught with hidden hazards for the public. The ordinary is now the source of peril.

The financial system is a particular instance of this. As L. Randall Wray, Professor of Economics at University of Missouri, Kansas City put it in November 2010, describing the situation prior to the 2008 housing market collapse: “In the end, the US financial system (and perhaps many others) became nothing but a massive criminal conspiracy to defraud borrowers.” (p. 174) That criminal conspiracy continues today as the norm.

A further example of this is the problem of global warming and how it is being handled, or better stated, not being handled:

While Obama believes global warming is a danger, the measures being undertaken to slow it fall grievously far below what is necessary at this point. As James Hansen, whose proven track record on anticipating the course of global warmings’ progressive danger signs makes him the most credible scientist around, has forcefully warned, the point of no return has already been passed and emergency measures are needed. In a 2003 report commissioned by Andrew Marshall and written by former Shell Oil Head of Planning Peter Schwartz and California think tank Global Business Network’s Doug Randall, the Department of Defense (DoD) itself warned of the convulsive effects that global warming in the not distant future will wreak in the form of forced migrations of tens of millions and wars over resources critical to actual survival; the DoD described this as a threat “greater than terrorism.”

The research suggests that …adverse weather conditions could develop relatively abruptly, with persistent changes in the atmospheric circulation causing drops in some regions of 5-10 degrees Fahrenheit in a single decade. Paleoclimatic evidence suggests that altered climatic patterns could last for as much as a century, as they did when the ocean conveyor collapsed 8,200 years ago, or, at the extreme, could last as long as 1,000 years as they did during the Younger Dryas, which began about 12,700 years ago. . . .

Rather than decades or even centuries of gradual warming, recent evidence suggests the possibility that a more dire climate scenario may actually be unfolding. . . . 

As famine, disease, and weather-related disasters strike due to the abrupt climate change, many countries’ needs will exceed their carrying capacity. This will create a sense of desperation, which is likely to lead to offensive aggression in order to reclaim balance. Imagine eastern European countries, struggling to feed their populations with a falling supply of food, water, and energy, eyeing Russia, whose population is already in decline, for access to its grain, minerals, and energy supply. Or, picture Japan, suffering from flooding along its coastal cities and contamination of its fresh water supply, eying Russia’s Sakhalin Island oil and gas reserves as an energy source to power desalination plants and energy-intensive agricultural processes… [Emphasis added.]

The response from the Pentagon’s spokesperson Dan Hetlage to this report was interesting:

We did not expect any White House response to the Pentagon on this report. Andrew Marshall is our Yoda, our big thinker who peers into the future. But it’s all speculation. It was very ethereal, very broad in scope. It wasn’t like, “Oh, wow, that totally debunks the president’s stand on global warming,” because it was merely a thought exercise. We don’t have a crystal ball. We don’t really know.[i] [Emphasis in the original.]

They “don’t really know.” When astronauts go into space, the backup systems NASA creates to protect the astronauts and their missions are multiple in nature in case the first few fail. The scenarios they run in preparation for outer space travel are diverse and complex. These efforts are protecting a handful of people in space; yet, when the entire planet is at risk, the trigger for action is based on whether or not they know for certain that something will happen. Of course, at the point when the dangers are manifest and present, action in response is much too late. This is the equivalent of packing the entirety of humanity into one big car and those in charge of the welfare of the passengers deciding that they are not going to put on any seatbelts because they do not know for certain that there will be an accident. (Pp. 166-168)

If global warming is, according to the DoD itself, a greater threat than terrorism, then the abject failure to address global warming fully and the corresponding huge diversion of resources to the WOT are catastrophically bad decisions. But the full dimensions of this failure and the dangers that it is sowing are only evident if you are willing to think outside of the box of the authorities’ narrow-minded perspective.

Bureaucracies’ basic characteristics are a contributing factor to this picture. They perpetuate inequalities by promoting subordination, secrecy and deception, and ultimately the concentration of power and the attribution of privileges to elites. They also primarily “focus on process more than on results.” As Loo lays this out – and we’re quoting from this at length because of the centrality of the points he makes here:

What does it tell us about the nature of the contemporary and near term future world that disasters that arise out of the very context of our collective lives are a) certain, b) unlikely to be properly foreseen, c) extremely unlikely to be adequately prepared for, and d) more dangerous than any planned hostile actions?

It tells us at least two things.

First, the system we live in – global capitalism – is inherently unstable and dangerous whether you look at it from a local, national or international perspective. The spheres of the local, national and international are so intertwined that they cannot sensibly be separated as though events in one sphere do not impact the others.

Second, stability and security are more things of the past than of the present and, especially, the future. Massive dislocations and dramatic, startling changes to the status quo are not the stuff of science fiction but that which the DOD itself now finds it must take seriously. Granted, Frier’s document is not a policy document but a think tank document. But his evaluation of the situation compels serious reflection.

Several factors stand in the way of properly grasping the reality that we face. These factors include – not necessarily in order of importance:

• Bureaucratic practice and thinking, which by definition involves the routinization of ways of doing and seeing things based on what has previously happened and not what hasn’t yet happened, thus, narrowing down and aggressively anti-imaginative approaches trump their opposite. Bureaucracies, we should note, run things in the modern world. They are, in core respects, the modern world;

• Neoliberal policies – politics in service to globalization – dominate (both the GOP and the Democrats are Friedmanites) and therefore aggressive globalization which continues creating and deepening the bases for disasters and hamstringing human responses to disasters are not going to be modified or stemmed;

• Preparing for the future and hedging against unanticipated disasters are diametrically opposed to neoliberal policies of allocating resources most sparingly and cheaply for profit-making – e.g., allowing more hospital bedspace for a disaster is considered inefficient and unprofitable, devoting resources to developing flu vaccines is less profitable than drugs that require daily doses and are therefore neglected leaving us extraordinarily vulnerable to a flu epidemic.

To paraphrase (and modify) FDR, what we have to fear is the system itself proceeding along as it is. The economic crisis and the implacable wars are the most obvious conditions we confront today. But the matters which are being ruled off the table by public officials are the most perilous of all: a) re-establishing the rule of law through prosecution of its violators and b) the very logic and operations of globalization and its exacerbating of the existing economic and political inequalities and manifest threats to the planet.[ii]

Nathan Freier, in an online debate at the Strategic Studies Institute in April 2009, said in his final remarks,

[F]or strategists an inescapable set of plausible worst-case scenarios [of crippling instability for “strategic states” can be readily foreseen]. Many would require rapid, comprehensive employment of significant U.S. land forces. The principal landpower mission would be stopping and reversing hemorrhaging human insecurity in advance of irreparable harm. In many cases, pursuit of minimum essential strategic and operational objectives like this requires resources and capabilities far in excess of those available to the entire Marine Corps.

In designing future land forces, let’s first be realistic about the worst-case future demand signal. I suggest it is likely to be response to a fatally broken strategic state. Then let’s be realistic about what can be achieved. Here, I argue for pursuit of limited objectives that will still require significant land forces to achieve unpalatable but nonetheless manageable strategic and operational outcomes.[iii]

Having laid out a convincing case that strategic shocks are unavoidable, and difficult or impossible to foresee, let alone properly prepare for, the best that Freier can offer to deal with this is the deployment of significant US land forces, beyond what the entire Marine Corps is capable of, producing unpalatable outcomes. What if this crisis occurs while the US is already engaged in one or more wars as it is currently? The incapacity of the US to police this contingency is readily apparent.

The logic of Freier’s analysis conflicts with his prescription of US military responses. His analysis of “known unknowns” and the threats of “context” (shocks in the absence of hostile design or intent) points to the unmanageable and inherently dangerous, unbridled forces of globalization and movements such as ethnic warfare, fascistic nativist movements, and desperate people suffering from an epidemic, natural or man-made, that globalization spawns. In comparison to that, the deployment of military force, however large, can provide small comfort even for those who are convinced of the justness and propriety of US military action. (Pp. 134-136)

As they laud their respect for the rule of law and for democracy and liberty, neoliberals have been systematically insulating the government and corporate world, especially the highest executive levels, from the people’s opinions and voices, creating an executive that is not accountable or even supervised by any other governmental branch or by the People. This reflects a momentous shift in governmental norms worldwide that begin in the 1970s known as public order policies that treat everyone as a suspect and where governmental coercion can be used upon you pre-emptively, even if you have committed no crime. What was displayed as a dystopian future in the film Minority Report, in other words, is now the emergent standard of governance. These policies have been instituted under the signboard of the “war on terror” but their inception date from before 9/11 and are not being carried out because of anti-state terrorism. This explains the adoption of expressly fascist laws such as Obama’s open use of assassination of those he alone has designated as enemies of the state and the National Defense Authorization Act of 2012 that, upon Obama’s request, included American citizens picked up on U.S. soil as among those who can, simply by accusation, be arrested and held indefinitely without a right to challenge their detention.

Neoliberals’ insistence on what amounts to dictatorial powers and their campaign to override the rule of law is necessary because if their true agenda were publicly unveiled, it would go down to ignominious defeat since their agenda means the relentless exploitation of the vast majority of humanity and the pillaging of the environment. Neoliberal policies systematically stick it to the public and deprive them of the means to life. Given this, there is no way that they can stay in power if they don’t utilize increasingly unfettered forms of power. That explains the yawning gap between what they’re doing and what they are saying about what they’re doing: they can only get their way through misrepresentation, manipulation, and force. Authorities’ forcible evictions of the Occupy encampments in spite of and in fact, in significant respect, due to the popularity of Occupy, are an example of authorities’ intolerance for dissent and exposés of their policies.

As people around the world grapple with neoliberal policies’ negative consequences, different ideas contend about what the best path to take is. Some argue that state power is no longer relevant. Loo argues by contrast that state power is the key focal point of struggle between neoliberals (whether they’re neoconservatives or the “Democratic” version of neoliberalism) and those who want a radically different world. State power remains fundamental. By contrast the outer shell of political power (electoral campaigns, elections, speeches, debates, legislative votes, judicial decisions, and so on) are mainly public relations designed to convey the impression of democratic and lawful decision-making, with the real decision-making occurring behind closed doors.

Violence, at least some degree of violence, is an inherent part of the political struggle and is often the price to pay for social change, Loo asserts. One only needs to look at recent revolutions that have occurred throughout the world, such as the end of apartheid in South Africa, or the more recent uprisings in the Middle East, to come to that conclusion.

Loo also explains that neoliberals are implementing public order policies, i.e., policies that are supposedly aimed at preventing the unlikely “generalized and ubiquitous foe,” instead of more tangible and specific public threats. Neoliberals waste a lot of effort and resources in the implementation of those policies, which according to Loo, are damaging to society, and are mostly ineffective and illegal. The overwhelming amount of data collected by intelligence agencies on a daily basis to supposedly thwart potential terrorist threats and hunt down alleged terrorists illustrates this point (on the order of four times as much data collected daily as resides in the entire Library of Congress). Loo explains that one of the main problems with having access to too much irrelevant information is as follows:

If you have too much data, then connecting dots becomes extremely difficult because you have too many possible threads to perceive and millions upon millions of irrelevant data points obscuring those threads. It is like trying to find multiple needles in a haystack while haystack after haystack after haystack is being dropped on you in an avalanche of hay. (p. 151)

No one is exempt of becoming a target of those methods, i.e., anyone can be and in fact everyone is targeted as a suspect. This environment fosters a climate of ubiquitous fear and threat based on nothing but smoke, something that Loo describes as “a cacophony of threatening noise.” Loo goes as far as saying that the U.S. government has a huge stake in maintaining that climate of ubiquitous fear and threat because it warrants and legitimizes the need for more social control. In turn, those repressive measures help the government pursue their hidden agenda (i.e., profit-making and increased political power).

The net result of all of this? An inherently unstable and increasingly destablizing system that generates tremendously damaging endemic and episodically catastrophic results. That is a conclusion that can be reached even if we were to not even consider the question of the inherent injustice of it all.


[i] Amanda Little, “Apocalyptic Pentagon Report on Global Warming Could Spur Action on Capitol Hill,” Pentagoners (blog),, February 25, 2004,, accessed on July 30, 2010.

[ii] Dennis Loo, “The Water Line: Morality, the Rule of Law, and Leadership,”, Winter 2009,, accessed January 2, 2010.

[iii] Steven Metz and Nathan P. Freier, “The Army’s Strategic Role: An Online Debate April 02-April 15, 2009,”,