The Other Road to Serfdom: Recovery by the Market and the Affect Economy in New Orleans
In 2010, I was told that during the 2008 presidential campaign, the University of Chicago Press had a surprising run on a book by Friedrich Hayek titled The Road to Serfdom. A best seller when it was originally published in 1944, Hayek’s book was called “a war cry” against socialist planning, endorsing the idea that private sector investments and free market solutions are more efficient and effective than government spending or planning programs. Hayek argued that centralized planning leads ultimately to impoverishment under the tyranny of authoritarian government (his example is Nazi Germany)—a type of serfdom.1 Applauded by neoliberalist Milton Friedman and other Chicago School economists, Hayek’s work has been perhaps misleadingly called an endorsement of “laissez-faire capitalism” as the best route to both democratic freedom and socioeconomic stability.2 Hayek received a Nobel Prize in 1974 and a Presidential Medal of Freedom from George H. W. Bush in 1991, and his work continues to be embraced by conservatives of several political parties.
The effort to “recover” New Orleans post-Katrina offers an extraordinary example of the changing landscape of neoliberalism in America and, in particular, a view of what can happen when government lets the for-profit private sector do the work that the public sector needs to do. It offers a glimpse, I would argue, of another road to serfdom than that proposed by Hayek. In New Orleans, market policies and practices of privatization of government services are implicated as both causes and solutions to deep suffering caused by a disaster. New Orleans offers a good example of how neoliberalism today emerges in the shadow of its ideal self as responses to disaster reveal hardened regimes of market complicity with big government, not necessarily against it.3 Humanitarian relief and recovery assistance are now market affairs in which government remains, de facto, involved, but by way of markets organized for profit more than for relief. New Orleans reveals how markets have penetrated into the public sector with real implications for citizens in need. Poverty is turned into a problem of entrepreneurialism, and disasters are turned into market opportunities for profit, while government funding fuels capital accumulation in the corporate sector at the expense of many in communities like New Orleans.
Debates at the federal level over the effectiveness and legitimacy of providing federal funding to support disaster relief and other safety net programs (as opposed to leaving this job to private sector charities) are historically persistent and fraught with further debates over moral blame, Christian virtue, racial inequality, and the legitimacy of Congress vs. the courts in deciding policy and federal action (Dauber 2005). In fact, any history of the “Sympathetic State,” Dauber notes, must include accounting for the role of nearly a century of federal disaster relief in paving the way for Roosevelt’s New Deal, even in eras prior to Roosevelt’s term that are labeled “laissez-faire.” Federal support for disaster relief, like support for those in need more generally, is not historically new, nor is it necessarily on the wane. The welfare state has not been replaced by neoliberalist crony capitalism; rather crony capitalism now makes money on the welfare state.4 Relief assistance is funneled through the private sector in new ways and sometimes with disastrous outcomes that enable the market to penetrate far beyond government programs, even into the world of private sector charity. The market becomes the de facto measure of performance for those providing relief and for those who are trying to recover. The story of post–Hurricane Katrina New Orleans is thus in some sense exemplary of late-neoliberal experience, even if the post–Hurricane Katrina situation in New Orleans is in some sense historically and culturally unique.5
Understanding the privatization of public sector resources requires understanding a new set of commitments, as Margaret Somers (2008) notes — commitments to the subtle replacement of an ethics of public care with an ethics of private profit. If neoliberal policies discourage dependency on the part of the poor and needy on government “handouts” as not only failures of public policy but also failures of personhood and citizenship, then new regimes of marketized governance both reinforce and reverse this logic. They enable the needy to become a site for the production of capital while enabling the market to help grow businesses that profit on disaster. At the same time, nongovernmental and charity institutions, particularly faith-based, have been called upon to play a role in this arrangement, filling in where government-funded subcontract disaster relief has left gaps in the recovery landscape. As a result, a new set of market transactions has grown around the role of the poor and needy as both products and producers in an economy that relies on “affect” to generate new and quite large profits. Volunteers are called upon to do the work of relief while government subcontractors profit on government resources and unpaid labor, often funneled through churches. To illustrate how these new arrangements work, I focus on the story of one family in particular and one company that took a lead role in the recovery process through the Louisiana Recovery Authority’s Road Home Program.6
In August 2005, Henry and Gladys Bradlieu7 lived comfortably in retirement in one of the oldest properties in the Gentilly District of New Orleans. Henry served in Vietnam and was a three-time Purple Heart recipient. He was retired from the US Postal Service, and Gladys had been a data entry clerk for an office in city hall. They owned their two-bedroom home on the corner lot in what was, in 2005, a densely packed mixed-race neighborhood — a success story of middle-class comfort, as evidenced then by public schools and parks, sidewalks and neighborhood churches, mortgages and relatively low crime rates, and where the history of racial disparity that overlaid this community seemed at least in some small part to be muted. What could not be seen by the Bradlieus, or perhaps anyone else, was the fragility of their lives — a fragility that had less to do with race than it did with the changing shape of governance in America.8
On August 27, 2005, the Bradlieus evacuated to Texas and watched on television as their home was swallowed up by Hurricane Katrina and the subsequent collapse of the levee system that resulted in the flooding of 80 percent of the city. The Bradlieus’ home was under ten feet of water. It stayed that way for three weeks. When they finally came back to the city a few months later, Gladys recalled what it looked like. It was so quiet. “No birds, no trees, no color. Nothing. Just gray, everywhere gray.” Furniture was covered in layers of lifeless mud. Silverware that had been washed off kitchen counters was strewn about in layers of smelly and gooey sludge. Family photographs were blackened and moldy. Clothing, linens, books, and shoes were indistinguishable from the walls, with their wallpaper peeling away in sheets from the stained brown gray Sheetrock behind them. Worst of all, Gladys said, were the trees. Most of them had been uprooted, and the rest were covered in brown and were as lifeless as the neighborhood around them.
Like a lot of returning residents, Henry and Gladys didn’t really know where to begin. They had a check for $2,500 and a trailer from the Federal Emergency Management Agency (FEMA). The church folks in Texas who helped the Bradlieus sent them home with a few items of clothing and some dishware, glasses, and linens. The Bradlieus moved into their FEMA trailer, which measured around three hundred square feet and was parked lengthwise on what was once their front lawn. As African Americans who had lived through the years before the civil rights movement, they were used to pulling themselves up by their own bootstraps, or at least with just the Lord’s help. Henry said, “We’ll rebuild.”
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Thanks are expressed to the NIH (NIA) R01AG28621 (Gay Becker original grantwriter), and particular thanks to the research team; Edwina Newsom, Taslim van Hattum, Diana English, Sandra Moody, Sharon Kaufman, Andrena Morris, Carmen Buchner, Amaya Perez-Brumer, Harpreet Samra, Shelina Fordingham, and advising colleagues Martha Ward and Suzanne Huertin-Roberts, as well as anonymous reviewers.
- The alternative view, held by others at the time, was that both of these were a result of “the dying grasp of a failed capitalist system” (Hayek 2007 ).
- A companion book, The New Road to Serfdom: A Letter of Warning to America, written by Daniel Hannan in 2010, is called a “must read” for the Tea Party. “Hannan argues forcefully and passionately that Americans must not allow Barack Obama to take them down the road to European Union – style social democracy. He pleads with Americans not to “abandon the founding principles that have made their country a beacon of liberty for the rest of the world.” www.amazon .com/New-Road-Serfdom-Warning-America/dp/0061956937/ref=sr_1_1?ie=UTF8&qid=1293125397&sr=8-1.
- See Klein 2008 on New Orleans, Lave et al. 2010 on science, and Greenhouse 2010 for good examples of ethnographic, on-the-ground impacts of neoliberal policies. Harvey’s (2005) description of neoliberalism identifies this trend well, pointing to the contemporary unlimited expansion of the demands of capital into all spheres, from governance and public sector institutions to even more ephemeral spaces of consciousness and identity. He identifies an intensification of the role of capital in governance, ethics, and cultural logics, and this is accompanied by a reorganization of our economy, education, and juridical systems in ways that serve capital. This arrangement also points to what George Soros (2000), in critical perspective, calls the rise of “market fundamentalism” — the firm and delusional belief, taking the form of religious devotion, that the market can and will solve our problems, even when government remains involved in the distribution channels. This arrangement begins to define what is at stake at a human individual level when the public sector is penetrated, and ultimately eroded, by corporate and market interests.
- See Gunewardena and Schuller 2008for more on disaster capitalism globally and in New Orleans. I focus here on the specific example of relief assistance for home rebuilding as well as the role of charity NGOs in this matrix.
- Some might read post–Hurricane Katrina New Orleans as an example of a contingent assemblage that included “a terrorist-obsessed federal administration, incompetent urban and regional governance, and opportunistic NGOs” (phrasing I have stolen from a very helpful reviewer). I would suggest these are also tied to neoliberal demands that have been placed on them by (1) subcontracts with homeland security companies, (2) the undermining of regional authority by such subcontracting arrangements, and (3) the rise of NGOs to fill in the gaps created by these arrangements that made NGOs scramble for their own profits. For a positive take on the balance of private vs. public responses to Katrina, see Aiello and Stein 2010.
- The material for this article is based largely on four years of data collection with 163 participants (each interviewed two to four times), beginning in late 2006. Data collection was done with help from research assistants, especially Taslim van Hattum, Diana English, and Edwina Newsom, and involved participant observation in New Orleans, including working as a volunteer by myself. All interviews were transcribed and coded by me.
- The names of all people in this article are pseudonyms. The description of the Bradlieus is not a compilation of multiple cases, although it offers an example of the post-hurricane experience that was very typical for many.
- Eric Klinenberg (2002) usefully describes this fragility in his study of the 1995 Chicago heat wave that killed hundreds of residents. In his “social autopsy” of the disaster, he attributes the deaths to the fact that the majority of those who died were among the most vulnerable (the elderly, the poorest), to the fact that response agencies were ill prepared to help the most vulnerable, and to preexisting social infrastructures of inequality (including cutbacks in safety net support for the poor and elderly) that made these patterns of mortality inevitable. The interesting thing about recovery in New Orleans is how so many middle-class families were plundered by the recovery process, not necessarily by the disaster of the hurricane or floods. For a discussion of how natural disasters are never “natural” and always reveal social inequalities that precede the events of crisis see also Oliver-Smith 1996.