Thursday, June 09, 2005

No Kings In Asia

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Jim Hoagland has written an interesting article for The Washington Post, but necessarily the way he intended. Mr. Hoagland’s article, titled “Whose Asian Century?”, examines the race between China and India for economic dominance in Asia. This is an interesting thought, but I found reason to question Mr. Hoagland, using his very reasons in application to his column. I found a number of statements which don’t bear up well to inspection.

Mr. Hoagland began by saying of China, “empires unravel, usually from within.” However, that was not the case of England, which became a Constitutional Republic of sorts, though not as we Americans call it. And as for Egypt, Rome, France, Russia, and the original Chinese Empires? They fell after costly wars against nations intent on invading/destroying them. Mr. Hoagland’s warning only becomes salient, if we find a military expedition headed in the direction of Beijing.

Defending the claim that India, not China, is headed for regional supremacy in commerce and industry, Hoagland writes “Current straight-line projections of China's rise to power neglect developments and adjustments in other Asian countries, particularly in the region's two great democracies, India and Japan.”

OK, first off: Does anybody else here see the difficulty in putting India and Japan on the same page, in strategic terms, or of comparing either of these countries to the United States, politically? There’s a reason neither Japan nor India has met its promise in the past half-century, and their governments have a lot to do with it. In Japan, there’s not so much a democracy as an oligarchy, a rigidly controlled network or ministries which approve every tissue for a sneeze, almost. Far too regulated and controlled to react to spontaneous opportunities, or to give entrepreneurs real freedom to explore new tactics. As for India, they’re a Democracy all right, in the same way Greece is a Democracy. There’s practically no order at all, which scares off a lot of investment because there is no regulation for critical industries. Ask the Wharton School of Business and they’ll assure you yes, they study Japan and India, but they do not envy them.

Hoagland then makes a statement I might have agreed with 15 years ago, but not now: “Politically, China is ruled by Leninists who must maintain the status quo. Militarily it relies on a large, underequipped land army. Economically it has adapted and mastered Henry Ford's assembly line on a continental scale. Financially it hordes its cash, regulates its markets with zeal and defensively uses fiscal policy to prevent mass upheaval.” All of those statements are true at one level, but they fail to understand the critical creation of Autonomous Precincts. These are largely ignored by Western observers, because there is no true political or military autonomy in those regions, and in places like Nepal “autonomy” is no more than a big lie. But in Canton and certain other precincts, especially the Hong Kong and Macau regions, the business climate is slowly changing to allow some real innovation. Chinese leaders, whether Manchu warlords or Wen Jiabao’s committees of industry, like to have their perks, and China rewards those who bring in capital investment. It’s not enough to make China a global power in commerce, but it is an underestimated factor.

Asia is more than China; Mr. Hoagland got that much right. But he has a lot more to learn, before handing crowns to Japan or India.

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