E Asia [Was: Re: Hardt & Negri on Genoa]

At 6:18 PM -0400 23/7/01, Threehegemons@aol.com wrote:
>As I see it, there are three areas of significant amounts of capital
>accumulation in the system today,  Europe, the US, East Asia.  Each has

Accumulation in E Asia, perhaps outside of China, is much dependent 
upon access to Euro-American markets, made much worse by Japan's 
ongoing crisis. It's been estimated that some 40% of E Asian growth 
last year was due to the exports of electronics and electronic 
products -- hence the collapse this year. As I've previously 
mentioned in this forum, for a country like Malaysia, total trade to 
gdp is about 190% and electronics and electronic products account for 
close to 60% of export value, but this is extreme even in the context 
of E Asia; other countries have lower ratios. But importantly the 
various countries are  trying to export pretty much the same products 
at roughly similar levels of technology -- but with two tiers, that 
of Taiwan, Korea and Japan at one, and that of the others. At the 
lower tier, it's becoming quite evident that unless they can make a 
quick switch, no one can quite compete with China which is sucking in 
the capital and spewing out the goods and doing an 8% clip at it, 
with the big question mark being how the rural population is going to 
take the widening gap and the urban working class the erosion of 
previous rights with the primary replacement being greater freedom of 
movement and consumption (for those who don't lose their jobs in the 
privatisation process.)

In addition, the differences between the various countries of the 
region do mean that it's not going to be like an EU any time in the 
near future. State of the economy, wage rates, per capita incomes, 
poverty rates, etc. are all much wider apart than in the EU bloc of 
countries. A country like Malaysia is a net importer of labour -- 
with something like 10% of the labour force being foreign 
(unofficially, it's closer to 20%) -- while Singapore is trying to 
draw in the professional and intellectual labour, with its capacity 
to do so greatly enhanced by the financial crisis. The Philippines 
would have little growth if not for remittances. Indonesia is 
probably going to take a generation to re-set itself.

These features make the comparison of the three regions, and 
especially with the US, not especially meaningful, even misleading.

>countries--Eastern Europe and Latin America in particular..  But I'm not
>sure, if things were purely a popularity contest, that this form of
>capitalism would be as popular with the strata of professionals worldwide as
>the European kind--in which the market is subordinated to the wisdom of the
>professional classes.  The tensions over the Kyoto accords epitomize the
>different vision of Europe and the US. Europe isn't very good at bullying
>anyone these days, so it mostly preserves what it has on the continent. Then
>there is the East Asian brand of capitalism--the market subordinated to the
>needs of the maintenance of community.

There would appear to be a distinctive path of capitalist development 
in E Asia, and it's much more welfarist than the absence of formal 
welfare systems might suggest. But, please, let's not go overboard 
and buy wholesale into official propaganda about maintenance of 
community. Nor underestimate the attractions of neo-liberal ideology 
to the professional classes (at least up until the financial crisis, 
with varying responses since), if not for the same reasons that 
neo-liberal theology seems to have swept the field in much of 
EuroAmerica.

Amongst the reasons for the attraction of neo-liberal ideology for 
the professionals -- aside from the fact that so many of the leading 
professionals were trained in the period of neo-liberal ascendancy -- 
is the role and character of the state. Thus, for many, 
neo-liberalism was seen as a means to trim the over-bearing state. 
However, in a state such as Thailand, neo-liberal ideology has taken 
a bit of a beating with the crisis -- a result both of nationalism as 
well as the much less developed informal state-sponsored welfarism of 
Thailand. In Singapore, the state itself has further embraced 
neo-liberalism, seeing that as its way of further propelling 
Singapore ahead of the pack, but keeping a wary eye on the 
"heartlanders", fearing a backlash against the cosmopolitans (the 
Stalinists did have a point about the cosmopolitans ;)). Amongst 
capitalists, neo-liberalism appeals to those with global links and 
connections, not so to the more localised. It's not a simple matter 
of bribery and propaganda; it's also local perceptions of local 
issues within a global ideological frame established, usually, by 
EuroAmerica.

>Apart from several 'mouses that roar'--leaders of Malaysia and Singapore,
>notably, not Japan, China or even South Korea--East Asian leaders haven't
>made much of an effort to point the world in any sort of direction.

Careful there. The "roaring" is not against US capitalism as such, or 
even whole chunks of globalisation, but rather against liberal 
democracy and that globalisation which cuts into state power and 
bureaucratic discretion, amongst other things. It was during their 
watch that the wave of privatisation took place, and continues to be 
official policy. It was during their watch that liberalisation of 
financial systems without concomitant regulatory mechanisms occurred, 
etc. It was during their watch that the boom of the late '80s and 
early '90s became hubris, exemplified in, e.g., cheering that at some 
points in the early '90s, the volume of trade on the Kuala Lumpur 
Stock Exchange exceeded that on Wall Street!

>Why would these three capitalisms compete?  They all have specific industries
>and economic strategies they want to promote.  They have different strengths
>and weaknesses.  For example, East Asia can clearly produce anything the US
>can for much lower cost.  But as Walden Bello points out, the way the US
>tries to get around this is to institute global copyright notions that will
>indefinitely secure for the US monopoly positions in certain industries.

See above. At the moment, E Asia is hardly competing as such. And if 
it's competing, it's with the US and, less so, the European working 
class for the 'privilege' of being the working class of the US- and 
Euro-based transnationals.

Sure, there are attempts to try and promote specific home-grown 
industries, but the second tier has largely not managed to do so yet 
to any great extent -- and even in areas where there are specific 
resource advantages, such as wooden furniture, it remains dependent 
upon demand from elsewhere and continues to compete largely on price, 
a competition that China can only win.

I'm not sure Walden is altogether right on the copyright/ipr issue. 
It's a nice issue on which to get worked up about -- tangible, 
immediate, symbolic, focussed, and with quite a few outrageous 
examples, such as nim, basmati, etc. Yet, in the new and emerging 
technologies, it really is more than possible for brain-workers here 
to get somewhere -- and nowhere because the cost of bringing things 
to market is so high and because the market is so locked up. Take 
pharmaceuticals: while someone could discover, say, a candidate 
vaccine, it would be difficult to marshall the resources to take that 
through the whole process and into production. Not so much an issue 
of ipr itself as the whole panoply of regulations, etc. imposed by, 
e.g. US FDA and GMP. There are also the specifics of US patent law 
that can well deny patent to a non-US entity, or at least a 
meaningful patent -- and even when one is obtained, the cost of 
policing it in the US would be exorbitant.

>that fighting a war over it would require.  As Peter Gowan argues, the Asia
>crisis was, in some ways, the US's best shot--and it failed--the US blinked
>before South Korea, and was not able to get the East Asian states to
>wholeheartedly adopt its form of capitalism.

Actually, I don't think it blinked before S Korea. It blinked when 
faced the effect of Russian default: LTCM and the possible threat to 
US financial stability. And so interest rates were dropped twice in 
quick succession which, together with devalued E Asian currencies and 
uncertainties, extended the life on 'irrational exuberance' and set 
off a consumption boom, pulling E Asia out of the pot, only to drop 
it into another pot in 2001.

>So now what?  I think over the next twenty to thirty years we'll definitely
>see East Asia be more articulate about how it doesn't want to be part of this
>empire.  Much as the Protestants broke with the church while remaining
>Christian, I think they'll remain within the framework of human
>rights/rationalistic modernity, but redefine these for their own purposes.

I hope so, but I have my doubts. But for sure I hope the 
protestantism will not be moonie-like, as it threatens to be in more 
than one place.

China, Indonesia and S Asia are big imponderables. I suspect the 
break-up of China would not be unwelcome to the US, perhaps less so 
to the EU, provided it can be contained, leaving a not un-Russianlike 
situation: imagine a one billion workforce of impoverished Chinese. 
But the choice may not be theirs -- can the widening gaps in China, 
minus the safety nets, be controlled and contained? If not, then the 
break-up of the Soviet Union may well look like a tea party.

Can Indonesia find its way towards some acceptable federal solution, 
while containing a resurgent minority Islamism? Everywhere, the 
Afghan chickens are coming home to roost -- we need to thank the CIA 
for that.

Ditto, can S Asia also find its way to a workable federalism, or will 
it descend into Hindu nationalism? Will Hindu nationalism be the 
"ideal shell" for Indian neo-liberalism which is supported by big 
capital and the professionals, opposed by the poor and regional 
capital? And Pakistan -- will Musharraf militarism contain the Afghan 
chickens or will it go into a downward spiral of a failed state?

kj khoo