The recent strikes and economic difficulties in South Korea have overturned one of the bourgeoisies arguments in its ideological campaign to refute marxism. Disappointed by the end of the Japanese “miracle”, the bourgeoisie seized on the considerable growth rates of the “Asian dragons” (South Korea, Taiwan, Hong Kong, Singapore) and the rise of new “tigers” (Thailand, Indonesia, Malaysia). Wasnt their prosperity the “proof” that underdeveloped countries can quickly emerge out of poverty, and that the credit for these successes lies with capitalism and its market laws? And how many times have we been shown striking workers who carry on with their work while wearing an armband to mark their discontent? The “devotion to the interests of the company”, the “legendary discipline” of the south east Asian workers has been presented to us by the bourgeoisie and its media as one of the secrets of the economic success of these countries and as the living proof of the emptiness of the marxist theory that class conflict is inevitable.
With the collapse of the eastern bloc and the demise of Stalinism, which has been falsely presented as the end of communism, the whole bourgeoisie announced the triumph of the “market economy” and promised a new era of prosperity. But the brutal realities of the crisis, austerity measures and mass redundancies on a scale not seen for 25 years, are there to contradict these triumphant speeches and to disperse the ideological fog of these phony promises about a future of “prosperity”. More than ever, the bourgeoisie urgently needs models of success in order to keep its myths alive and hide the historic bankruptcy of its system. It has to do all it can to prevent the proletariat, its mortal enemy, from becoming aware of the real roots of the crisis, from understanding that capitalism has no other future than one which drags humanity into growing impoverishment and into increasingly murderous military conflicts. This is why, after the more and more evident exposure of its German and Japanese models, the ideological pimps of the bourgeoisie have been promoting the south east Asian examples as new poles of growth. This is one of the new mystifications in vogue today.
Only
a global analysis of the decadence of capitalism can enable us to
understand the place and significance of the relative economic
development of the south east Asian dragons and how they constitute
an exception to the rule of massive deindustrialisation in the third
world and to the general incapacity of the capitalist mode of
production to develop the productive forces. The figures are very
eloquent here: the third world only returned to the level of
industrialisation per inhabitant it had in 1750 two centuries later,
in 1960. Despite all the bourgeoisies triumphant talk about the
dynamism of south east Asia and third world development, during the
period of decadence the gap between the industrialised countries and
the rest of the world has grown bigger and bigger: it has more than
doubled, going from 1 to 3.4 in 1913 to 1 to 8.2 in 1990. Whereas
during the ascendant phase of capitalism the population integrated
into the productive process grew more rapidly than the population
itself, today we are seeing a growing mass of workers being ejected
from the system. The end of capitalisms progressive role can be
measured, among other things, by its inability to develop one of its
main productive forces: labour power. The small burst of
industrialisation in the third world during the years 1960-70, which
was vigorous enough in terms of growth rates, in no way overturned
the overall situation. It was limited in time and space, it depended
entirely on the mode of accumulation in the developed countries, and
in the end proved very costly and pernicious for the third world
itself. But apart from a few exceptions, mostly localised in south
east Asia, most of the attempts to create a real industrial base
failed. And no wonder, since the established industrial powers hardly
wanted to see the generalisation of new competitors.[1] [1]
Without
developing here on a question which we will have to return to on
another occasion, we want to recall that the brunt of
industrialisation in the third world has been concentrated in only
five countries: Brazil and the four dragons.[2] [2]
Together, these five countries supply nearly 80% of exports of
manufactured goods from the third world, even though they make up
only 6% of the latters population. Looking at the four dragons alone,
the imbalance is even greater: in 1990 they supplied two thirds of
exports of manufactured goods from the whole of the third world, but
represent only 3% of its population. Limited in space, this
development was also limited in time. The brief reversal of the
general dynamic in the years 1967-77 (cf the table below) has again
given way to an increase in the relative gap: the growth of
production in the third world went back to a rate lower than that of
the industrialised countries. Entire zones even stopped growing,
since production per capita simply went into decline. The 1980s, real
lost years for the third world, put a definite end to the illusions.
The few exceptions which escaped this general evolution did not
refute the overall tendency. The 1980s saw a quasi-stagnation in per
capita production (0.7%) in the countries of the southern hemisphere
Its only in the general context described above that we can pose the question of the cause, scale and nature of the growth that took place in south east Asia. First of all, we must exclude Japan from the growth figures in this region: Japan was the only country in the region which went through an industrial revolution in the 19th century and freed itself from any major direct or even indirect colonial domination. This country, which went through its capitalist transformation via the Meiji revolution of 1867, has to be seen as one of the economic powers that emerged during the ascendant period of capitalism.
The south east Asian exception can only be understood in the context of the deadly struggle between the two military blocs (NATO and the Warsaw Pact) which came out of the second imperialist world war. Contained in Europe in the immediate post-war period, the expansion of the eastern bloc was displaced towards Asia. The USSRs support for the Maoist bourgeois faction which came to power in 1949, plus the war in Korea, led the USA to develop a policy aimed at blocking the expansion of its imperialist rival in this part of the globe. Aware that economic and social poverty was one of the main arguments used by the pro-Soviet nationalist factions who came to power in certain Asian countries, the USA created zones on the very borders of China (Taiwan, Hong Kong, South Korea and Japan) which could serve as outposts of western prosperity. The priority for the USA was to establish a cordon sanitaire against the advances of the Soviet bloc in Asia. Contrary to its policies in the rest of the world, the USA was to use an impressive arsenal of measures to sap the objective bases of social discontent in these countries. Thus, whereas almost everywhere in the world America had violently opposed agrarian and institutional reforms and had supported the most retrograde factions of the ruling bourgeoisies, it promoted revolutionary economic and social policies in the four Asian countries we have mentioned. These policies were completely determined by its geostrategic interests in the region. South Korea, for example, did not have any particular economic strong points. Lacking in raw materials, and with most of its industrial base limited to the north, the country was drained dry at the end of the war: production had fallen by 44% and employment by 59%. Sources of fresh capital, intermediate means of production, technical competence and managerial capacities were virtually non-existent. Only the imperatives of the cold war pushed the USA to support South Korea to the hilt. Against the stupid assertions about the formidable self-development of south east Asia, the growth of the ‘dragons’ was the pure product of American imperialist interests in the context of the cold war. There is no doubt that without the massive aid of the US from the beginning and for long years afterwards, these countries, and particularly South Korea and Taiwan, would not have survived as national states.
Contrary to the great claims of bourgeois propaganda about the dynamism of capitalism and the possibility for new arrivals on the world market to industrialise and compete with the older powers, the development of south east Asia is no mystery. Japan and the four dragons were chosen by the USA to revitalise eastern Asia and to form a barrier against its Chinese and Russian rivals. These military or one party states enjoyed a breathing space after the second world war that was available to very few others. This development, bracketed in time and space, confirms the thesis that the decadence of the capitalist mode of production is characterised by inter-imperialist conflicts, by a deadly economic struggle over a saturated world market and thus by the overwhelming weight of militarism and the war economy.
Certainly, this bracket has marked a kind of success, which no doubt went beyond America’s post-war predictions; to some extent it has even backfired against its instigator at the economic level. But this situation can only be temporary. Despite the delay, just like Japan, these islands of prosperity in south east Asia are set on a course towards recession. The present difficulties in these countries shows that this region of the world is no exception. They are gradually entering into a zone of economic turbulence. The recent economic problems and social conflicts are trebly illustrative. To begin with, they show that the crisis of capitalism is indeed world-wide and that, even if has to some extent spared certain geographical areas for a while, it is now hitting every country in the world, though still to varying degrees. Exceptions are becoming increasingly rare and the crisis is making all situations more and more homogeneous. This is a first blow struck against the myth of the so-called south east Asian model. Secondly, the strikes in Korea are a striking refutation of all the claims about the integration of the Korean workers, which aim to divide the world proletariat. They show the international unity of interests of the working class, against the myths of an Asian working class that is entirely subservient to a higher national interest. Finally, the crisis and the social conflicts are undermining another myth, the myth of an economic solution inside of capitalism.
Today, with the saturation of the world market and the economic difficulties of the US itself, the period in which the dragons could profit from the opening up of the US market is now over. The tolerated conquest of the American market by the dragons after the war had as its corollary a growing dependence on American policies. Thus, South Korea - and the situation is analogous for Taiwan - is a very outgoing country and thus highly dependent on the world market (in 1987, its exports accounted for 40% of GNP), and above all on the American market (in the same year the US market absorbed 40% of South Koreas exports). Overnight, the South Korean economy could enter violently into recession as a result of a slow-down in world trade, a major shift in exchange rates or protectionist measures. This dependence is all the greater, and all the more threatening of economic failure, in that it is the falling trade surplus with the US that has to finance the growing trade deficit in equipment and technology with Japan - goods that are needed to ensure the competivity of Korean capital. Here a new obstacle appears: since the success of the dragons is based on technology which has proven its worth but which is produced at low cost, these countries, in their efforts to negotiate the turn-around to a higher value production, have to pile up their debts and thus fall into technological dependence on Japan which is more and more controlling the economy of the whole region.
Furthermore, the continuation of the success of the two decades after the war was to a large extent possible thanks to the old recipes of public deficits and debts (see tables above) which have strongly fueled inflation.
As with other third world success stories, growth since the onset of the crisis is a balloon puffed up by debt and could burst at any moment. The big investors are well aware of this: Among the reasons the richest industrial countries have been so anxious to double the IMFs emergency credit lines to 850 billions is that a new Mexico-style crisis is feared, this time in the Far East. The upsurge in the Pacific economies has stimulated enormous private sector capital flows, which have been substituted for domestic saving, leading to an unstable financial situation. The question has been which Asian tiger would be the first to fall (Guardian, 16.10.96). Every time the crumbling of one myth threatens to expose the failure of the whole capitalist system, the bourgeoisie conjures up new ones. A few years ago it was the German and Japanese miracles; then, after the collapse of the eastern bloc, the bright new tomorrow offered by the new markets in eastern Europe and Russia. Today the dragons are in vogue. But the recent and future difficulties in the region show and will show to the working class that these little emperors are also naked, tearing a little bit more of the veil behind which the bourgeoisie tries to hide the bankruptcy of the capitalist mode of production.
C Mel
Sources: Aseniero Georges, Le contexte transnational du developpment de la Coree du Sud et du Taiwan, an article published in Mondialisation et Accumulation. LHarmattan, 1993; Bairoch Paul, Le Tiers-Monde dans limpasse, Gallimard 1992; Myths et paradoxes de lhistoire economique, La Decouverte, 1994; Banque Mondiale, annual Rapport sur le developpment dans le monde; Coutros and Husson; Le Destin du Tiers Monde, Nathan, 1993; Chung H Lee, La Transformation economic de la Coree du Sud, OECD, 1995; Dumont and Paquet, Taiwan, le Prix de la Reussite, La Decouverte, 1987; Lorot and Schwob, Singapore, Taiwan, Hong Kong, Coree du Sud, les Nouveaux Conquerants?, Hatier 1987; PNUD Rapport mondial sur le developpment humain, Economica, 1992
1 [6] Thus, if the whole of the third world had exported per inhabitant as many manufactured articles as the middle ranker of the four dragons, this would have almost been the equivalent of the total consumption of the developed western countries!
2 [7] While South Korea and Taiwan are two countries that regroup respectively 44.5.and 19 million people, Hong Kong and Singapore are both island city-states founded by the British colonialists and only have 6.1. and 2.9 million inhabitants.
3 [8] It is estimated in fact that on average, the income of the 80% made up by the poorest farmers increased by 20 to 30%, while the income of the 4% made up by the richest went down by about 80%.
4 [9] Other ambitious changes were initiated under US guidance, such as the great education programmes aimed at producing a well-trained work force.
5 [10] The first and most important source of finance was the acquisition by the chaebols of assigned goods at prices well under their value. Just after the war this made up 30% of what South Korea inherited from the Japanese. Initially placed under the control of the American office of assigned goods, they were distributed by the office itself and by the Korean government.
Links
[1] https://en.internationalism.org/ir/89/dragons#sdfootnote1sym
[2] https://en.internationalism.org/ir/89/dragons#sdfootnote2sym
[3] https://en.internationalism.org/ir/89/dragons#sdfootnote3sym
[4] https://en.internationalism.org/ir/89/dragons#sdfootnote4sym
[5] https://en.internationalism.org/ir/89/dragons#sdfootnote5sym
[6] https://en.internationalism.org/ir/89/dragons#sdfootnote1anc
[7] https://en.internationalism.org/ir/89/dragons#sdfootnote2anc
[8] https://en.internationalism.org/ir/89/dragons#sdfootnote3anc
[9] https://en.internationalism.org/ir/89/dragons#sdfootnote4anc
[10] https://en.internationalism.org/ir/89/dragons#sdfootnote5anc
[11] https://en.internationalism.org/tag/geographical/korea
[12] https://en.internationalism.org/tag/4/30/economics