American, European and Russian corporations are the only ones winning from humanitarian disasters of their own making.
As a tentative ceasefire continues to hold in Syria, with the next round of peace talks having resumed this week, you’d be forgiven for thinking that there might be an end in sight to a conflict that has raged for nearly five years.
But as with every war in the Middle East, nothing is quite as it seems.
According to Naomi Klein in her book The Shock Doctrine, corporatist (a more pertinent term for what many of us consider “neoliberal”) policymakers — those that are inherently intertwined with both Government and multinational companies — take advantage of catastrophes such as economic collapse, hurricanes, terrorist attacks and even war, to further what she describes as their “policy trinity”: the elimination of the public sphere, total liberation for corporations and skeletal social spending.
In short, disaster capitalism is premised on a simple philosophy: where there’s chaos, there’s money to be made.
From Pinochet’s Chilean coup and subsequent reforms in the 70s, via Thatcher, to the Falklands conflict and the miner’s strike; from 9/11 to the second invasion of Iraq, Klein argues that the economist Milton Friedman was the spiritual leader of this “shock doctrine”:
“The falling bombs, the bursts of terror, the pounding winds serve to soften up whole societies much as the blaring music and blows in the torture cells soften up prisoners. Like the terrorised prisoner who gives up the names of his comrades and renounces his faith, shocked societies often give up things they would otherwise fiercely protect.”
For Klein, like a prisoner under torture, societies are moulded in three stages: firstly, being battered down so they no longer put up a fight against their captors and are “blank canvases”; then they are “encouraged” to relinquish control of their country and its commodities; and finally, political fiat decrees that anyone who defies this will be subject to more “shocks” (the nature of which may be metaphorical or physical).
Shock, awe and pipelineistan
If Klein were to rewrite The Shock Doctrine now, I hope she’d agree that the situation in Syria is playing out as a textbook example of her terrifying concept — because I believe that’s what we are witnessing.
To understand the actions of each nation involved in Syria, you first have to recognise their motivation. It is, as always, fossil fuels and the dollar — with human life at a lowly position down the pecking order.
The crux of the matter is that Bashar al-Assad put paid to the construction of an oil and gas pipeline, which would have ended Europe’s reliance on Russia for its natural gas, by refusing to sign an agreement with Qatar.
Instead, he opted for a partnership with Iran (after which the civil war in Syria intensified).
While the construction of the pipeline had previously been put on hold, it was quietly announced last July that Iran was forging ahead with a trunkline (“IGAT6”) to supply Iraq with natural gas; in theory, this could be the beginning of an Iran-Iraq-Syria pipeline — or one that goes direct to Turkey.
The Iranian pipeline would be unacceptable to both Washington and Brussels, as it would mean energy co-ordination from Iran, Iraq, Syria and Russia (putting pressure on their Sunni-led cohorts in the region), and also because the product from such would be traded in a basket of currencies — not exclusively the petrodollar.
Moreover, with Iran now emerging from sanctions (and forecast to produce 3.1m barrels of oil per day), its gas fields, the second largest reserves on the planet, are up for grabs to exporters.
There is, in Syria and across the spectrum of corporate interests of the countries involved, everything to play for — and the disaster capitalists are piling into the game, full throttle.
Europe’s refugee racket
The refugee crisis ostensibly splintering the governments of the EU is set to balloon.
Already this year, 133,549 people have reached Europe by sea — up more than 10 fold from 2015. The demographic has altered drastically as well: whereas last year, the breakdown of migrants/refugees by gender was 62% male, 16% women and 22% children, so far this year it has been 47%, 20% and 34% respectively.
The chaotic propaganda surrounding the refugee crisis continues unabated, each country pointing fingers at the other — for instance, when a NATO general accused Russia and Syria of weaponising the refugee crisis (while simultaneously characterising the people fleeing war as a hotbed of ISIS recruits). Meanwhile, Greece, in the midst of its own economic turmoil, is left to accommodate 122,000 souls under the UNHCR’s warning of an “imminent humanitarian disaster” unless other EU countries begin to take in these refugees.
In effect, the intentional bottleneck in Greece functions as yet another form of “shock” inflicted by the EU and Troika on an already flailing Syriza administration and its embattled leader Tsipras. With its third bailout looking unsteady amidst mutterings of the IMF pulling out of the deal, the Greek administration has no chips to bargain with, and holds minimal leverage within the EU.
In Paris, however, the terrorist attacks have been utilised in a near-textbook “Shock Doctrine” manner, with report, after report, after report in the aftermath wildly speculating as to whether the perpetrators were Syrian, whether they travelled with refugees or whether they were Islamist sleeper cells residing in the country.
The truth of the matter (after the public’s heads had been permanently spun) was that none of them were Syrian. Instead, five of the terrorists were French.
But this hasn’t stopped the French government from exploiting the horrific events of last year, by seeking to write a permanent “State of Emergency” into its constitution (receiving criticism from the likes of Human Rights Watch), and using the terror as leverage to conduct airstrikes on Syria.
Similarly, the UK administration has exploited the situation at every available opportunity: from an intentionally confused flip-flopping stance on the refugee crisis (veering from a “swarm”, to urging us to give charitably, to migrants being cast wholesale as potential women-raping terrorists), to cynically using the Paris atrocities to push through a vote on Syrian airstrikes in Syria.
This has been accompanied by the perpetual erosion of our “civil liberties” on the basis of perceived threats — also seeping shamelessly into the narrative on the EU referendum in the UK, with warnings from the French over a “Calais Jungle” in Kent if the Britain votes to leave.
Oh, and the reason the clearance of the “Calais Jungle” began last month?
It’s due to the construction of the ElecLink project commencing in July this year — a joint Anglo-French operation which will see the connection of the UK and French electricity supplies. The location of one of the refugee camps in Coquelles is also where a substation will be built.
The ElecLink plan is a joint project between STAR Capital and Group EuroTunnel. Contracts have been awarded to Balfour Beatty and Siemens, and its aim is quite possibly to connect the whole of Europe as one energy supply line.
But it is not just political leverage that is being gained from the humanitarian crisis we are witnessing — it’s financial, as well.
Lord Levene of Portsoken, a UK Conservative Party Peer, said of the “refugee crisis” that the “real solution” is finding a way of persuading others not to join them, of offering them hope, opportunity and security in their homeland. “Most of them don’t want to come to Britain.”
Yet, he appears to have a vested interest in the refugees doing just that.
Mitie, whose CEO is Conservative Peer Baroness McGregor-Smith, operates security for the company, with a £12m contract awarded in March 2014. But Mitie is also the largest contractor for UK immigration detention centres.
Interestingly, neither Group Eurotunnel, nor Mitie’s share prices, have been negatively affected by the ‘refugee crisis’. Far from it — Mitie’s share price spiked when the news of its Eurotunnel contract was announced, and Group Eurotunnel bulled in April (the deadliest month for people drowning in the Mediterranean).
The reasoning for the latter’s share price boom? Probably something to do with the EU’s Frontex budget being tripled in the aftermath by the EU, who also allocated another €50m to Calais later in the year; all money privately-owned Eurotunnel doesn’t have to spend.
Lord Levene is also responsible for the Conservative government’s annual Defence Reform Report.
This report recommends the recognition of the importance of “cyber warfare, international collaboration, intelligence, surveillance” and “fewer but better” “pieces of kit.”
Lord Levene is also Chairman of General Dynamics’ UK Ltd — who were awarded a £135m contract on the 6th March for an upgrade to the British Army’s tactical communications and data services system (the same General Dynamics who provide engineering and development services for Trident.)
And he’s also Vice Chairman of “Starr International”, who provide security and intelligence services to governments.
Moreover, General Dynamics has just been co-awarded a $682m contract by the US Government to supply Turkey with BLU-109 penetrator bomb bodies and components — which will most-likely be used against the Kurdish People’s Protection Units (YPG), whom the West consider an ally.
Levene may well not want those fleeing war and terror in Syria to stay in Europe, but he also appears happy to profit from the very actions that are forcing them to leave in the first place.
But it’s not just British law-makers and companies who are pitched to benefit directly from the conflict in Syria.
In Greece, 101 fingerprinting machines have been procured to register every migrant on the Eurodac database, the contract being awarded to Group Bull.
Bull’s parent company is Atos, who are the main contractor behind the NATO Air Command Control and Information Services (AirC2IS) in Turkey — a system designed to procure the “efficient and effective employment of joint air capabilities and forces made available to NATO. It consists of a repetitive process for planning, coordination, allocation tasking, monitoring and assessment of joint air missions” — joint air missions of the like currently being undertaken in Syria by the West.
Unisys is another firm awarded an EU border contract to enhance their IT systems. Unisys’ Director is Philippe Germond, also a board member of Qosmos, currently being investigated for supplying the Assad regime with surveillance software.
So it’s a “double-whammy” for Unisys — it wins with a US contract to support the bombing of Syria, and wins again with an EU contract to control the people fleeing that bombing.
By fuelling war in Syria on the one hand, and herding the desperate people trying to escape into the “Gateways to Europe” of Turkey then Greece on the other, a permanent state of humanitarian crisis has been created — and the shocking effects are being exploited for corporate profits to their full potential.
Perhaps the most complex role in the Syrian debacle is that of Russia, long-standing ally of Assad and perpetual thorn in the side of the West. Since the conflict began, it has stood by Assad as a long-standing political ally, but also due to the military importance of the relationship (both financially through arms sales, and strategically through its naval base in Tartus).
But last year its position escalated into direct military support to the Assad government.
Since launching its campaign of airstrikes in September, Russian actions have been masticated and spat out by commentators, citing numerous reasons for the intervention, including the perceived threat of 2,000 Russian terrorists returning home, phallic posturing on the world stage and creating a distraction from events in Ukraine — all of which are debatable.
Admittedly, having a renewed strong foothold in the region presents opportunities with newly economically-free Iran and the unstable administration in Iraq — and this is probably a driving factor.
But Russia’s intervention is, in my view, overtly financially-driven — seizing an opportunity missed by the US, and expediting it to maximum effect.
With a domestic economy that contracted by 3.7% last year, the Saudi-engineered collapse in oil price plummeting the value of the Ruble and wages falling in the country by nearly 10% in real terms since 2014, the conflict in Syria presents a two-pronged opportunity: to bolster public morale (and mute any disquiet) at home, and open up economic windows of opportunity abroad.
The Russian ambassador to Syria was quoted in an interview as saying:
“I use this opportunity to urge Russian businesses to take more active steps. This is the best time to launch operations in Syria.”
Take the Russian company Stroytransgaz, already active in Syria having been granted a £2bn contract by Assad for a pumping station on the Tigris river, and looking to make further inroads; or Novatek, Russia’s second largest gas producer, which is showing keen interest in Iran’s South Pars gas field (a major source in the proposed Iran-Iraq-Syria gas pipeline).
Gennady Timchenko is the chairman and largest shareholder of Volga Group — the parent investment company of both the firms.
One of Russia’s richest men, Timchenko is a close friend of Vladimir Putin and frequent benefactor of this fact (receiving contracts for the Sochi Olympics, for example). There have long been rumours of Putin being financially embroiled with Timchenko, although these have always been fervently denied — however, to say he hold Putin’s ear would probably be an understatement.
Russia’s Gazprom is another example, being in talks already with the Syrian government. The company’s CEO, Alexey Miller, met with the Syrian ambassador to Russia, Riad Haddad, in February to discuss “bilateral cooperation after the end of hostilities”; this follows more diplomatic “meetings” last year where the potential to exploit oil and gas off the Syrian coastline was discussed between the latter’s Foreign Minister and Russia’s Deputy Prime Minister.
Although severely damaged since the 2008 financial crash (losing over $150bn in value), Gazprom remains the Kremlin’s ultimate disaster capitalist-geopolitical weapon. As the world’s largest gas producer, a perfect example of its use by Putin as a political tool can be noted in Ukraine: gas prices to the country were reduced by a third when former President Yanukovych refused to sign a supply deal with the EU; as soon as he was ousted, Gazprom ramped the price up by a staggering 81%.
The corporatist nature of the relationship between Gazprom and the Kremlin is patently obvious — even more so when you look at its CEO, Miller.
Working under Putin in St. Petersburg in the 1990’s, he was allegedly engineered into the role at Gazprom by the President himself, after being the Deputy Energy Minister of the Russian Federation for just over a year.
The influence the Kremlin holds over the company, being its 50% majority shareholder also, is obvious. But that also means that it has another 50% of its shareholders to keep happy — so it walks a fine tightrope between pleasing two masters.
If you take the potential openings available in a post-war Syria, coupled with the potential opportunities for itself and BRICS more broadly, you see what has led Russia to play America’s traditional role in this conflict — staging its very own “Operation Enduring Freedom”.
In The Shock Doctrine, Klein asserts that after the fall of the USSR the chaos surrounding the rise of Yeltsin was disaster capitalism’s “shock therapy” at work, and describes Putin’s reign as being “seen by many as a similar backlash against the shock therapy era… riling up public sentiment about the events of the early 90’s which are frequently portrayed as a foreign conspiracy to put Russia under ‘external management.’”
This may, in part, be true — and Klein also acknowledges the rise of the “state oligarch” around Putin (Timchenko being one such example); but even she didn’t foresee the ascension of a “Frankenstein’s Monster” of the West’s creation as a corporatist power in its own right — a power which is now adhering to the textbook, three-act “Shock Doctrine”, albeit not against a legitimate Government, but against a people who pose a direct threat to the interests of multinationals.
Washington Has Fallen
Since 2011, the role of the United States in the Syrian conflict has evolved haphazardly, giving the appearance of an on-the-hoof foreign policy desperately attempting to match the pace of Russia’s bluff-calling.
After showing a muted interest in Syria for years (ranging from dreams of regime change to courting Assad as a ‘liberal reformer’ just before the 2011 uprising), we began with a fairly bog-standard disaster capitalist response to a faltering Assad and the Arab Spring of 2011: funnel money and arms into the opposition; use accusations of war crimes and the threat of terrorism to coerce the public into backing a campaign of airstrikes; train anti-government fighters in coordination with Middle Eastern allies and run black ops to stoke the sectarian fire —all in the hope of Assad falling amidst a Biblical fog of chaos, making way for the American corporatist “diplomats” to move in.
And of course, US, British, French and Israeli companies are among the mix of giant energy firms with a keen interest in outmanoeuvring the Russians, with a view to swoop into the aftermath of the Syrian war to access its untapped offshore oil and gas resources.
It should have run like the second Iraqi war had been hoped to — as Klein describes it:
“…the use of force would be so stunning, so overwhelming, that the Iraqi’s would go into a kind of suspended animation. In that window of opportunity, Iraq’s invaders would slip in another set of shocks — these ones economic — which would create a model free-market democracy on the blank slate that was post-invasion Iraq.”
But there was a problem.
Russia’s scaling-up its involvement in support of Assad appeared to catch Washington wholly off-guard, and subsequently the US position has descended into self-induced disarray.
They mistakenly believed they could control an organic opposition which is perpetually shape-shifting; note the marked change in Washington’s public stance — from the original distorted fiction of ‘moderate’ freedom fighters, to Kerry last month blaming them for the failure of peace talks.
Russia’s deployment of the traditional US tactic of a 21st century blitzkrieg to shock the population into submission has also thrown the Americans completely off kilter. Couple that with strained oil relations between the US and Saudi Arabia, while NATO-ally Turkey goes off the rails unpredictably, and you have an administration suffering from shock itself.
In October, the Pentagon reportedly cancelled a $500m “moderate” rebel training scheme after few were actually trained; couple this with the now utterly blurred lines between “moderates” and “Islamists”; countless reports documenting fighters switching sides along with their American weaponry (note the Tony Blair Faith Foundation’s bizarre endorsements of al-Qaeda affiliate al-Nusra) and the CIA’s black ops going ‘awry’, and one wonders if the US administration has been left wishing it had tried to carpet-bomb Assad and Syria into submission in the first place.
Even with the GOP’s feverish admonishing of their nation’s stance, interest in any further military-related intervention in Syria is waning in the Obama administration’s final hours, with US officials effectively admitting that they have no clear idea of their next move. The likelihood is a stalling-action with tentative positive overtures to Russia, until we learn in November who will be installed in the White House.
But the US administration’s faltering policy-stance on Syria by no means shuts the door on corporatists benefiting from the conflict.
On the 13th June 2013, the US government announced the supply of lethal arms to the Syrian Military Council. After flat lining for over a decade, the impact on Lockheed Martin’s share price was spectacular (a bullish spike begins at the end of June, 2013).
Furthermore, after the Ghouta chemical weapons attack (which Obama called a “red line”) on the 21st August 2013, trading in shares of Lockheed Martin increased 4-fold.
Both these instances are, of course, to be expected. Bruce Tanner, Executive VP at Lockheed Marin, was recorded at a conference in the US saying the company would see “indirect benefits” from the Syrian war. His colleague, Raytheon CEO Tom Kennedy, similarly confirmed his company had seen a “significant uptick” in business in the Middle East.
Lockheed manufacture the F-22 bomber, currently flying US sorties over the skies of Syria, while Raytheon made $18.6m last year from a contract to enhance Jordan’s border security with its war-torn neighbour.
But Lockheed’s political interests should also be noted.
In 2012, Lockheed Martin donated $25,000 to the Maryland Democratic Party (the largest political donation they have made in the past four years). Congressman Steny Hoyer, the representative for Maryland’s 5th district, is the House Democratic Whip and supported Obama’s course of airstrikes in Syria — so would it seem unsurprising that the President’s call for military intervention was passed?
Dutch Ruppersberger, Maryland’s 2nd district representative, is a US House of Representatives Member (Lockheed also donated to his re-election campaign in 2012).
From 2011 to 2015, Ruppersberger sat on the House Intelligence Committee which is privy to the country’s most secret intelligence activities to maintain proper oversight. His district in Maryland is also home to the National Security Agency (NSA).
He also was responsible for the Cyber Intelligence Sharing and Protection Act (CISPA), designed to increase intelligence sharing between private cyber security firms and government agencies (which Lockheed Martin lobbied for), so that corporations can pass on information to governments to help prevent threats, even if the data is not connected to any threats at all
Note that Lockheed Martin seems to lobby every quarter, every year, on defence budgets.
In a situation where America and Russia have appeared to swap corporatist-cosplay roles, and the former left with few options, how to sum up the current US position in Syria? Outmanoeuvred, out of ideas and effectively out of time.
While elected governments frantically sing, dance and clap to us, their captive audience, the real organ-grinders are contently watching from afar, safe in the knowledge that whatever the outcome, they will be the real winners.
They are, of course, a small sub-set of multinational corporations, defence contractors, security firms and banks.
As I have previously written with regard to the nuclear arms industry, the biggest multinational financial institutions have vested interests in every side whenever an opportunity is presented to further ‘disaster capitalism.’
For instance, Barclays and HSBC finance has directly filtered down to Almaz-Antey, the manufacturer of the BUK missile that purportedly shot down flight MH17. Similarly, the publicly-owned Royal Bank of Scotland invests in ten companies involved in the UK’s Trident, but is simultaneously a financier of Russia’s Dolgorukiy nuclear deterrent as well.
The conflict in Syria is no different.
Take the US BGM-71 TOW anti tank missile, supplied by the US to the rebels (and frequently making its way into the hands of al-Qaeda affiliate al-Nusra, and even ISIS).
Manufactured by Raytheon, the company has a $1.25bn credit agreement with top Wall Street bank, JP Morgan Chase.
Also in Syria, the Russians are operating the S-400 SAM missile defence system which is produced by Almaz-Antey. Funding for the company generally comes from either the Russian Government directly, or via the state-owned Vnesheconombank (VEB) development bank, and in April 2011 VEB signed an agreement for a syndicated loan worth $2.4bn, from 19 bank.
Somewhat predictably, JP Morgan Chase was one of these financiers.
Take Fidelity Investments — investors in Atos, Lockheed Martin, Mitie and Raytheon. Fidelity have donated £450,000 to the Conservative Party since 2010, and through their holdings directly benefit from the bombing in Syria at one end, and the humanitarian crisis that ensues at the other: their investees create the weapons used in the war, and construct the fingerprint machines used to register the refugees that end up on European shores.
But, once again, Fidelity are also linked to Russia. They are shareholders in numerous Russian companies: Novatek (natural gas), Lukoil and Tafnet (oil companies), and most notably Sberbank — who are the nominated financiers for Uralvagonzavod, whose tanks are being used by the Syrian Government.
Another financial institution benefiting from the Syrian conflict (whatever the outcome) is State Street Corporation. State is a 17% majority shareholder in Lockheed Martin, but simultaneously owns holdings in Gazprom, and like its competitor Fidelity Investments, in Sberbank.
But possibly most worrying is State Street’s relationship with the Bill & Melinda Gates Foundation — or, specifically, the firm’s $6m fee for being custodians of the Foundation’s investment portfolio. The foundation provides money for the relief effort to support those affected by the Syrian conflict —the same conflict which State Street Corporation directly profits from due to its shares in a giant defence contractor like Lockheed Martin.
The interlocking, overlapping relationships between organisations which profess to support some of the poorest and most vulnerable people on the planet and financial institutions with a direct hand in putting these individuals into precarity in the first place, is not unusual. The same relationship occurs at the William and Flora Hewlett Foundation with the Bank of New York Mellon, which directly links to Oxfam.
Aside from Oxfam being heavily involved in humanitarian operations in Syria, the charity operates a scheme called the “Inclusive Impact Investment fund” — a mechanism to issue finance to SME start-ups in Africa and Asia.
Funding is provided by private donations and by charitable/philanthropic organisations — one of these beingthe Hewlett Foundation, which has contributed just under $4m since 2007.
The custodian of the Hewlett Foundation’s finances and credit provider is the Bank of New York Mellon Corporation — which simultaneously invests in a multitude of arms companies (including Lockheed Martin and Raytheon, active in Syria), along with NATO contractor Atos and Russian energy giant Gazprom. Yet they also sponsor the likes of the Boston Foundation’s charitable dinners to help raise funds for, amongst other things, the humanitarian response in Syria.
The public, and specifically those subject to war and its resultant consequences, are merely shockable, expendable pawns in the financial system’s global game of chess. Here, corporatist governments play the disaster capitalist roles of bishops, rooks and knights, while the King and Queen represent the banking institutions themselves.
This is, of course, one game where there will never be a discernible ‘check mate’ (however much propaganda we are fed in an attempt into coercing us to think otherwise) — because that would, of course, be unprofitable.
Written in 2007, Klein broadly and tentatively concluded that “the shock” was wearing off; Latin America was broadly rejecting Friedman’s legacy; in Europe battles raged between the “free markets and the free people”, and she also (prophetically) wrote that Eastern European countries, Russia and the US were beginning to see the rise of far-right, racist manifestos in a cynical response to decades of corporatism:
“Once the mechanics of the Shock Doctrine are deeply and collectively understood, whole communities become harder to take by surprise, more difficult to confuse — shock resistant.”
This may well be true, but I think Klein underestimated the nefarious resilience of the phenomenon she identified so well. You only have to look at events in Ukraine; China’s forward-march to what it calls (without irony) “internal consumption”; the US-instigated chaos in Venezuela and the Paris attacks in France to realise that the “Shock Doctrine” is alive and ferociously kicking.
But is Syria, in becoming centre-stage for the pinnacle performance of disaster capitalism, its final curtain call?
I am highly doubtful.
We are witnessing the first “World War” of the 21st century — but one that is executed by proxy. Every corporatist nation is writhing together in their own greed-driven Friedmanite excrement, all feverishly trying to gain control of the last Middle East outpost as yet untouched by globalised multinationalism: Russia, seeking to secure the same gas supply and commodities as the EU; the US, desperately wanting regime change so it can plunge its claws into the one blank corporate canvas left in the Middle East; the Sunni Gulf regimes, frantically suppressing any Shi’a uprising for fear of losing their archaic, totalitarian grip on their kingdoms; and Turkey, under the increasingly despotic Erdogan, attempting to play everyone off against each other.
The outcome of this power struggle will be macabrely fascinating. Will we see a cessation of hostilities between Russia and the West, and a working relationship developed to wheedle out Syria’s resources in two directions? Will Putin’s oligarchs get their way, ushering in a new phase of corporatist-led proxy wars in the region? Or will the US manage to impose Klein’s “holy trinity”?
Whatever the outcome, it will not be the people of Syria who benefit.
Estimates indicate that more than 470,000 Syrians have died since the conflict began, with more than 6.5m being internally displaced, 480,000 effectively besieged (preventing them from receiving supplies of life’s basic necessities) and 13.5m in need of humanitarian aid.
The only beneficiaries will be those furthest from Syria’s ‘Ground Zero’, the corporatists in front of their computer screens — watching their bank balance rise, with every life lost.
By Steve Topple