* World Bank, East-Asian Miracle, chapter 2. We are talking of growth rates averaging 6 or more percent per year. Taiwan, it should be noted, for all its economic power, is the invisible man. The World Bank’s Annual Development Report does not include data on Taiwan or even list it among the world’s nations—this, apparently to avoid offending the People’s Republic, which resents any hint of recognition of Taiwan as a separate entity. In the East Asian Miracle, Taiwan appears as “Taiwan, China.” Give the World Bank a tin medal for pusillanimity.
† Almost everyone who writes about the economic performance of these East Asian units comments on the quality of the workforce, but equally takes it somehow for granted. Manuel Castells, “Four Asian Tigers,” chapter 4 and passim, finds the most important common characteristic to be the role of the state, even in Hong Kong. My only problem with that is that one finds state intervention all over the place, sometimes wise, sometimes foolish. States may helpeconomic developement, but it takes a world of good work and enterprise to make the state look good.
** The World Bank calls these the “high-performing Asian economies,” which seems appropriate, but then vitiates its nomenclature by offering dubious growth data for other countries. What is one to make of a list of countries in order of growth per head per year 1960-85 that has Egypt, Greece, Syria, and Portugal up in the top twenty, and Botswana (diamonds) leading all the rest?—East Asian Miracle, chapter 1, based on Summers and Heston, “A New Set.”
* On Wales, see The Times (London), 6 January, 1997, chapter 3. On Daewoo: Int. Herald-Tribune, 18 October 1996, chapter 2; 19-20 October 1996, chapter 1. Daewoo got its slice of Thomson for a symbolic one-franc piece, but the gift came with a load of debt. (The French government is trying to reduce its deficit to pave the way for entry into the new currency union.) As of December 1996, however, the deal was off. French opponents of foreign invasion made much fuss about the symbolic franc, but said little or nothing about the debt. In pulling out, the French government tried to hide behind the European Community, but fooled nobody. In Korea, people speak of French racism—if it had been an American buyer, no trouble—and the Korean government calls French bad faith (xenophobia) “a national concern.” “France cannot be trusted.” Int. Herald-Tribune, 6 December 1996, p. 1; 9 December 1996, chapter 1; 15 January 1997, chapter 1. Note, however, that Korea itself is notoriously hostile to foreign ownership. A tale of Eastern pot calling Western kettle black. Even so, Daewoo may still be interested.
* I am told, however, that the list of Thai names they draw on is such that informed Thais can recognize the Chinese origin.
† The Thais feel that they have been more welcoming than the Malaysians of their Chinese middleman minority—Kaplan, Ends of the Earth, chapter 23.
* On the other hand, Chinese clannishness makes them in some places a designated target for crime, the more so as they are richer than the majority population. This in turn discourages them from investing locally: who knows when they may have to run? Cf. Seth Mydans, “Kidnapping of Ethnic Chinese Rises in Philippines,” N.Y. Times, 17 March 1996, chapter 1.
* Annual income per household in 1995 for the Bangkok metropolitan area was estimated at 2.5 times the average for the entire kingdom. Achavanuntakul, “Effects of Government Policies,” chapter 1.
* The assembly-line principle was adaptable to various methods of manufacture. Henry Ford stressed long runs and stuck to technologies long after they were obsolete. When he was right, he was very, very right. And when he was wrong, other producers took market share. Flink, “Unplanned Obsolescence,” states that the Model T was in some respects obsolete from the start. But it was cheap, the price of the standard model going from $825 in 1908 to $260 in 1927. That was the end: in May 1927, the last of over 15 million Model T’s rolled off the line.
† It is easy to underestimate the contribution of the rickshaw, but it was the key vehicle of urban Japan: some 38,000 in Tokyo alone in 1888. Morris-Suzuki, Technological Transformation, chapter 6, argues that “the rikisha was just as important to Japan’s modern economic development as the railway.” She goes on to stress two aspects: it was the first Japanese vehicle to be exported, opening markets that would later take bicycles and motor vehicles; and it was made by networks of small suppliers of components, thereby anticipating the structures of the automobile and other assembly industries.
** Since Japan at this point had no enemies in prospect, one must see these measures as an anticipation of imperial expansion. On the law of 1918, see Morris-Suzuki, Technological Transformation, chapter 8.
* This is an old theme in the Japanese nationalist refrain. Haruhiro Fukui, “The Japanese State,” chapter 15, offers an eloquent exposition in a prefectural governor’s speech of 1904: “…war in peace time goes on constantly. In this kind of war, that is, struggle for survival, those who exploit scientific instruments to expand industry, produce goods at low costs, and thus absorb financial resources will nurture the strength of their own nation, enrich its resources, and thus emerge as winners….”
* Cf. Lee Iacocca, then chairman of Chrysler, on the $7-per-car economy on rust-proofing the Aspen, followed by $100 million in repairs and an even costlier loss of consumer confidence—Holusha, “Detroit’s Push,” p. D-8.
† March 1983: “Japanese auto makers introduced three cars this spring that make Detroit’s newest models seem dated already.” Nag and Simison, “With Three New Cars,” on the prospective impact of the Toyota Camry, the Honda Prelude, and the Mazda 626.
* The role of labor conflict and its interruptions is crucial. Ford, in the heyday of the $5 dollar wage and patriarchal management (1910s and early ’20s), could afford to squeeze inventories from the 204 days of 1903 to 17 days in 1922. In general, write Abernathy and Clark, “Notes on a Trip,” chapter 3, “Japanese practice has not extended process rationalization too far beyond the state of the art…in Ford’s Rouge River facility during the 1920s.”
* Note that things might have gone differently. In the postwar years, Japanese labor, often led by militant Communists, adopted an combative mode that was rejected and abandoned only after some fierce battles with company unions. The American occupation played its role: initially, it opened the door by legalizing trade unions; subsequently, its primary concern was to tame the unions by way of reducing Soviet influence.
† The economist Harvey Leibenstein states the contrast in general terms: “…the ideal in the West is a short-run contractual view or contractual ideal of firm association rather than a long-run belonging ideal. There is a sense in which the Western approach represents a series of contracts…involves devotion to a particular skill or job (even a ‘property right’ in the job) rather than loyalty to the firm in general”—“Japanese Management System,” chapter 1. See chapter 1 for contrasting results of attitude surveys: in 1976 49 percent of Japanese workers said they should help others when their own tasks were completed; only 16 percent of American workers felt that way.
* The same in Japanese criminal trials: by the time the matter comes to court, the accused has largely conceded, so that the conviction rate is almost 100 percent.
† The nature of Japanese labor relations has been a puzzle to specialists. Is this absence of conflict a stage that labor will outgrow? Or does it reflect deep-rooted social values and traditions? Many Japanese incline to the latter explanation, but Galenson and Odaka, “The Japanese Labor Market,” index page, do not think it necessary “to fall back on well-worn generalizations about family structure and the hierarchical, traditionalist nature of Japanese society.” Is an explanation less persuasive or valid because it is “well-worn”?
* Cf. the Chrysler bailout, where the government took stock as security. The stock appreciated enormously when Chrysler got back on track, at which point Chrysler tried to argue that the government should not get the capital gain. One can well imagine what Chrysler would have said had things gone the other way. Where fair play?
* Field, Inside the Arab World, chapte
r 2, points out that at rates of extraction in the early 1990s, oil in the Gulf has 130 years to go. (The assumption, of course, is that we know what’s there. People are still looking.) But that’s the Gulf; for other oil producers in the Middle East and North Africa, the end is nearer. Meanwhile progressive exhaustion is an incentive to a search for new energy technologies. In the end, for oil as now for coal, a fair amount may be left in the ground.
* The Soviets anticipated and perhaps taught the Germans. The “tens of thousands” of slave labor deaths incurred building the White Sea-Baltic canal (early 1930s)—picks, shovels, and wheelbarrows against snow, ice, and hunger—were justified by the allegedly redemptive character of the work, which would turn enemies of the people into good socialists. The slogan: “We will instruct nature and we will receive freedom.” Compare the motto at the entrance to the Nazi death camps: Arbeit macht frei—Work makes free. On the Soviet dream (nightmare) of ruthless gigantism (gods do not weep), see Josephson, “‘Projects of the Century.’”
* This was not what the Soviet authorities told the public; or, for that matter, what the International Atomic Energy Agency was ready to admit. Cf. Alexander R. Rich, “10 Years Later, Chernobyl’s True Story Is Hard to Nail Down,” Boston Globe, 26 April 1996, chapter 2.
† The human cost of Chernobyl may never be known. Officials, including medical personnel, were under great pressure to minimize casualties. (Contrast Bhopal, where the injured had a financial incentive to make claims.) Feshback and Friendly, Ecocide in the USSR, chapter 11, think doctors cleared out because they feared public anger. They may have feared radiation more.
* Typically the farmers will get enough to eat (will feed themselves first) if the government does not expropriate food supplies for distribution in cities or for sale abroad. So in Europe during World War II. But in the Soviet Union, seizure of farm crops in the 1930s in the Ukraine led to a ghastly famine that killed millions. But then, this was the intent. These were nationalists and kulaks, marked as enemies of the Revolution. For a brief, vivid description of this atrocious crime, see Moynahan, The Russian Century, pp. 114-22. To know this is to understand the eventual collapse of a rotten regime.
* On lateritic soil, see Chapter I.
* Algerian nationalists would now lay the blame for illiteracy on the French. Half the population, they say, was literate when the French came in 1830, but the French shut indigenous schools and admitted almost no Muslims to their new state schools. It takes willful credulity to believe that 50 percent figure (presumably none of the women and all of the men).
* I am reminded that superstition and magic are not dead; and some would argue that religious faith is part of this package. No doubt, because weak mortals that we are, we look for comfort where it is to be found. Even scientists and technicians are vulnerable, for science and reason are tough companions. Nonetheless, illusions, delusions, and faith are excluded in principle and practice from inquiry and discovery.
* This approach has found adepts in anthropology, which is confronted by the dilemma of its traditional subject matter: to cherish and preserve as in a gel; or to study and, so doing, promote the alteration and disappearance of the subject. On the virtues of the primitive, see Diamond, In Search of the Primitive; also Jordan, “Flight from Modernity.”
* Some would argue (thus A. G. Frank) that Europe’s knowledge and know-how did not surpass those of other civilizations until the Industrial Revolution, say, around 1800—as though European dominion were an accident and the Industrial Revolution an illumination. Bad history.
* Islands of growth: not everyone is enthralled. Paul Kennedy asks in Preparing for the Twenty-first Century: “How comfortable would it be to have islands of prosperity in a sea of poverty?” Rifkin, End of Work, is comparably scandalized by the contrasts of rich and poor. If that’s the way it’s going to be, we should move on to a “post-market society,” whatever that is. Cf. Mount, “No End in Sight.” What with the proliferating succession of post-this and post-that, we may soon see post-post and post-post-post.
† Smith does give some credence to limits, for he speaks of a country “which had acquired that full complement of riches which the nature of its soil and climate, and its situation with respect to other countries, allowed it to acquire; which could, therefore, advance no further”—Wealth of Nations, Book I, ch. 9: “Of the Profits of Stock.” But he treats this as a distant prospect, “perhaps” not as yet experienced, and adverts to the opportunities for transcending these limits with better “laws and institutions.”
** Thanks to botanical research and the invention of “miracle rice,” the world rice harvest nearly doubled from 1967 to 1992. India had its “Green Revolution.” Now population is once again pressing on supply, and the International Rice Research Institute promises a “super rice” that will yield 20 to 25 percent more—Seth Mydans, “Scientists Developing ‘Super Rice’ to Feed Asia,” N.Y. Times, 6 April 1997, p. A-9. Will that be enough? And what about Africa?
* But not always, because nobody wants that stuff. On 7 May 1996 rioters in Germany protested the return of radioactive wastes, German in origin, sent to France for processing and then brought back to Germany for presumably safe storage. The Germans spent millions of dollars to contain the angry crowds. That is why one economist recendy proposed that rich nations dump unwanted wastes in such poor places as Africa—all that sand, and the Africans need the money. The very idea is symbolically unacceptable.
* Russia is not a safe place to do business. Cf. Remnick, Lenin’s Tomb and Resurrection. Ukraine may well be worse. Cf. R. Bonner, “Ukraine Staggers on Path to the Free Market,” N.Y. Times, 9 April 1997, p. A-3.
The Wealth and Poverty of Nations: Why Some Are So Rich and Some So Poor Page 90