On Sat, 14 Feb 1998 kjkhoo@pop.jaring.my wrote:
> 7. Placed within the context of the current phase of
> globalization, I would suggest that E Asia, with the possible
> exception of Japan, has been effectively put in its place -- and
> I think the media has caught on to this with alacrity.
Ah, but this is the problem with most analyses of East Asian capitalism --
which either talk about the evil things Western capitalism is doing, and
talk about the poor, impoverished tigers, or talk about the evil things
comprador elites in SE Asia are doing to their poor, impoverished
citizens. The point is that Japanese capitalism is NOT identical with US
capitalism or European capitalism; Japan is governed by keiretsu, gigantic
cross-industrial shareholding structures, organized around giant banks and
insurance firms. The Nikkei punters do NOT make Japanese economic policy,
rather the government and the major multinationals and keiretsu
organizations do, something with tremendous consequences for East Asia.
Japanese foreign direct investment powered much of the Asian boom; and
indeed the Asian crisis is, at least in part, due to Japan's failure to
stimulate its domestic economy and thereby draw in more Asian exports.
And Japan could indeed jumpstart Asia: Japan is a global creditor, to the
tune of $800 billion or so, while the US is a global debtor, to the tune
of $1 trillion or so. Asia has not been put in its place; the triumph of
the rentiers is a hollow sham. The real story of the devaluations is not
the fall of the rupiah versus the dollar, but the strength of the yen
vis-a-vis the other East Asian currencies.
> But one point: It blinds as much as illuminates to talk of E
> Asia/SE Asia as one entity. The classification into 1st tier
> and 2nd tier NICs may be more helpful. If accepted, that the
> statement of since 1985 the strategy started breaking down is
> false. For the 2nd tiers, the period since 1985 has been one of
> unprecedented growth until the collapse. In fact, it's been the
> boom fueled by the Plaza Accord of 85 that made them recognized
> as 2nd tiers, I think.
By "strategy breaking down" I meant the simple export-push strategy of the
Sixties, where the point was to dump cheap textiles or labor-intensive
goods in American markets. That strategy was gradually replaced in the
Eighties by a more nuanced form of development: internal Asian markets
began to expand, Japan became the major destination for Asian exports and
not America, and the commodity mixture turned high-tech.
Your typology, though, is basically correct; whereas the
first NICs, like Taiwan and Singapore, built powerful developmental states
and carefully screened imports and pushed exports, the second
generation of tigers relied on foreign direct investment and the tap-on
effect of the tiger boom, plus lots of hired money. But Thailand et.
al. never developed a coherent developmental state, mostly for good
historical reasons (lack of Cold War American subsidies, and the fact that
the Vietnamese and Chinese, whose state apparatuses were forged in the
heat of epic world wars and revolutionary struggles, beat them to the
punch).
> Also one query: Dennis R writes that "Singapore is propping up
> Malaysia". What is the basis for saying so?
Singapore has huge investments in Malaysia, and is tied in innumerable
ways to the UMNO's developmental state. One interesting example:
Singaporeans spend something like 3 billion in Singaporean dollars in
Malaysia just as tourists. This is money which can be immediately recycled
for investment, savings, defending the currency etc. This is undoubtedly
why the collapse has been less severe in Malaysia than in, say, Indonesia.
-- Dennis