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How Capitalism Stacks the Deck on Disaster

Posted on Apr 4, 2013
H.Adam (CC BY 2.0)

By Steve Fraser, TomDispatch

(Page 4)

If rehabilitation and recovery was on the civic mind, certain minds counted more than others.  Everybody knew that the city’s wood-frame buildings could not stand up to the pressures of another earthquake, which—they also knew—was a reasonable future possibility.  So new building codes were adopted calling for the use of reinforced concrete and steel in structures over six stories high.  They lasted a year.  Pressures from the business community and builders caused the city to relax those rules, except in the new downtown which was urgently readying itself for the Panama Pacific International Exposition of 1915, where the city’s boosters hoped to eradicate the last pungent odors of the calamity.

A $500 “bonus plan” to help rebuild homes favored the native-born and two-parent households.  Housing rehabilitation began with the wealthy and worked its way very slowly to the poor.  There were lots of jobs for “earthquake mechanics,” but at wages that could never keep up with escalating rents driven by real-estate speculators. 

Insurance companies had by then rewritten their home-owner policies to exempt earthquakes from coverage.  Fire was covered, however, and it’s clear that people deliberately set fire to their own homes, already ruined by the tremors, since without insurance money there was no way they could recover and rebuild.  Not surprisingly, pay-offs were highest for the wealthy.  The insurance companies worked at delaying payments to the hardest hit, the poor.  This fit with the mood of the moment—that those working class shacks were “no loss to the city.”    

Neither was Chinatown.  San Francisco’s upper crust, as well as large portions of its white middle and working classes, had never been fond of the Chinese in their midst, even though they depended on their labors.  The quake struck the city’s burghers as an opportunity to funnel them out of the center of the city—the old Chinatown had largely been destroyed—to some enclave on its outskirts.  (“Fire has reclaimed civilization and cleanliness from the Chinese ghetto.”) Their plans were, however, successfully thwarted by the concerted resistance of the Chinese community.


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Resistance notwithstanding, Chicago and San Francisco emerged from their trials by fire as bustling centers of capitalist enterprise.  Disaster capitalism has a long history.  One of the last remaining “relief cottages” built by Funston’s army at the cost of $100 and rented for $2 was just recently sold for $600,000.

Recently, when the Republican majority in Congress temporarily blocked funds for Sandy relief and rehabilitation efforts, it was a chilling reminder that no matter how universal a calamity is, we live in times when the commonwealth regularly takes a backseat to wealth.  Appeals to fellowship, to mutual assistance and shared sacrifice seem to give way with scandalous speed to the commanding imperatives of a warped economy and political plutocracy.

More Sandys are surely headed our way, more climate-driven disasters of all sorts than we can now fully imagine. And rest assured, they will be no more “natural” than the Chicago fire, the Johnstown flood, or the San Francisco earthquake.  More than fire itself what we need to deal with now is the power of the finance, insurance, and real estate—or FIRE—sector whose leading corporations now effectively run our economy.  Without doing that, the “nature” these interests have helped create will punish us all while providing a ghoulish boondoggle for a few. 

Steve Fraser is editor-at-large of New Labor Forum, a co-founder of the American Empire Project, and author most recently of Wall Street: America’s Dream Palace.  A version of this piece will appear in the spring issue of New Labor Forum.

Follow TomDispatch on Twitter and join us on Facebook. Check out the newest Dispatch book, Nick Turse’s The Changing Face of Empire: Special Ops, Drones, Proxy Fighters, Secret Bases, and Cyberwarfare.

Copyright 2013 Steve Fraser

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