What's the East Asian Miracle?

[ralfy]

I was implicitly asked about this in two threads, so I'll make it simpler:

For hundreds of years, European states followed mercantilism. Mercantilism essentially involves selling more and buying less. When you do that, then you can save and industrialize.

Industrialization means using machines to make lots of things, compared to doing things manually. When you make more, you're more productive and you can earn more given the same amount of work.

Britain promoted this during the Age of Industrialization, and the U.S. followed. Prussia did similar through an authoritarian, Christian state with regulations, standards, etc. Their policies were later used worldwide for public education, standards in businesses, military training, etc.

After WW2, Japan, which was heavily influenced by Prussia and Britain in terms of industrialization, followed Prussian state policies (again, mercantilist) using the following principles:

protectionism and import substitution - restrict imports of things that you can make, and see if you can make things better;

nationalizing key industries - some businesses don't have competition for practical reasons (like utilities and public transport), so nationalize them;

infrastructure development - industrialization (see above) needs lots of energy, roads, bridges, ports, irrigation systems, etc.; that's infrastructure, and without it industrialization cannot be accomplished; it's also very costly, which is why you need to sell and save a lot;

export orientation - you need to find out how to make the industries that you protect grow, and that means selling to other countries; that also means you need to work slowly on quality and productivity, work with foreign investors and exploit technologies that they introduce, and so on;

regulation and planning - Japan used its heavyweight MITI (Ministry of International Trade and Industry) as its R&D, or research and development; essentially, it was the key government agency that did planning for the whole Japanese economy, and made sure that the private sector (the businesses not owned by government) worked with each other and with the government for the good of Japan.

That's the East Asian Miracle, and as seen in the last point above, also nationalist.

After Japan, Taiwan and South Korea followed, then HK and Singapore. The last four became known as "tiger economies." Others, like Malaysia, Thailand, Indonesia, and the Philippines, became known as the "tiger cubs."

What about China and Vietnam? They are controlled by Communist parties and developed between the "tigers" and the "tiger cubs," so they are not labeled such. China is usually referred to as a "dragon economy," but it's only because the dragon as a mythical animal is part of its culture. Vietnam, meanwhile, is usually referred to as the "rising star" of Asia. In any case, the policies that they followed are the same as those of the East Asian Miracle.

According to the Economist and others, the Philippines, which is the weakest in the group, will together with Bangladesh and Nigeria become the leading economy in the future because of young populations and resources that haven't been exploited fully, while the other countries are aging.

Last point: given the need for regulation and planning, then liberal democracy doesn't look like a right fit for this type of economic process, and that's logical. That's why many of the examples above involved combinations of authoritarian regimes, e.g., Japan with its single-party system, Singapore with the same and even a socialist one, Taiwan with almost four decades of Martial Law, South Korea with around two decades or so involving a military dictatorship, and so on.

Finally, at some point, usually referred to as "late capitalism," an industrialized economy has costs and income that are too high such that they reach a peak, and move away from mercantilism. That's what's happening to the richest countries in the world: their debt levels are rising, and they focus on service industries, especially financing. Manufacturing, etc., move to developing economies; at best, they have specialized manufacturing, which is the case for Germany, the Netherlands, etc., and even Taiwan.

[indianasmith]

No one here cares.

[Morpheus, the unwoke.]

Ralfy, at this point you're just trolling.  

Honestly I haven't been here that long but I'm willing to bet most folks here like a few things in common.

Bad movies obviously. I think most people here like those.

Also, I'd bet heavily most people here are kinda fond of things like democracy and liberty. As much as bad movies? Well, maybe. Or if not at least have some regard for them.    

So when you extoll the virtues of heavy handed authoritarian states here, you're really just trolling.


Also if authoritarian governments and command economies were truly successful then Russia would be an economic juggernautsky in the world instead of having an economy that looks like it needs a shot in the head to mercifully drop it as it shuffles and stumbles along moaning and drooling.  

But enough trolling please.

[Allhallowsday]

It is not Ralfy's fault that this forum is quiet.  He can write anything he wants particularly in a thread he starts.  Respond or don't.  Long winded is not bothersome.  Write something else to read. 

[ER]

Ralfy, at this point you're just trolling.  

Honestly I haven't been here that long but I'm willing to bet most folks here like a few things in common.

Bad movies obviously. I think most people here like those.

Also, I'd bet heavily most people here are kinda fond of things like democracy and liberty. As much as bad movies? Well, maybe. Or if not at least have some regard for them.    

So when you extoll the virtues of heavy handed authoritarian states here, you're really just trolling.


Also if authoritarian governments and command economies were truly successful then Russia would be an economic juggernautsky in the world instead of having an economy that looks like it needs a shot in the head to mercifully drop it as it shuffles and stumbles along moaning and drooling.  

But enough trolling please.

Gotta disagree. This is off topic discussions and almost anything goes here, so if ralfy wants to start a thread on these topics, hey, his call. Read, don't read, reply, don't reply. I have never gotten a troll vibe off ralfy. I apparently disagree with him on most subjects, but I don't think he's trying to stir up trouble for trouble's sake

[Alex]

Ralfy, at this point you're just trolling.  

Honestly I haven't been here that long but I'm willing to bet most folks here like a few things in common.

Bad movies obviously. I think most people here like those.

Also, I'd bet heavily most people here are kinda fond of things like democracy and liberty. As much as bad movies? Well, maybe. Or if not at least have some regard for them.    

So when you extoll the virtues of heavy handed authoritarian states here, you're really just trolling.


Also if authoritarian governments and command economies were truly successful then Russia would be an economic juggernautsky in the world instead of having an economy that looks like it needs a shot in the head to mercifully drop it as it shuffles and stumbles along moaning and drooling.  

But enough trolling please.

Gotta disagree. This is off topic discussions and almost anything goes here, so if ralfy wants to start a thread on these topics, hey, his call. Read, don't read, reply, don't reply. I have never gotten a troll vibe off ralfy. I apparently disagree with him on most subjects, but I don't think he's trying to stir up trouble for trouble's sake

I agree with ER here, although I am sorely tempted to derail his threads with off-topic stuff the way he has been doing to others people's threads. I won't (deliberately anyway), but the temptation is most certainly there.

[Rev. Powell]

lester may care.

But the perfect solution to ralfy dominating existing threads is for him to start his own threads. That way people who are interested may join the discussion. No need to tell him off, you can just ignore him if you want. If you come in to disagree with him, you've voluntarily signed up to discussion on his terms.

Back in the day there was a strict "no politics" rule here. It's no longer enforced, but several years ago Andrew did pop in and lock a political thread without comment. In fact, that was the last time we ever saw him.

[Allhallowsday]

Y'realize y'all might be as bad as Ralfy?   

...Back in the day there was a strict "no politics" rule here. It's no longer enforced, but several years ago Andrew did pop in and lock a political thread without comment. In fact, that was the last time we ever saw him.

Strict?  As long as I've been here there's been political arguments.  I remember only Andrew always bringing an unbiased tolerance until a flame war. 

[lester1/2jr]

I was actually satisfied with the conclusion of the last dialogue re this issue

[Rev. Powell]

Y'realize y'all might be as bad as Ralfy?   

...Back in the day there was a strict "no politics" rule here. It's no longer enforced, but several years ago Andrew did pop in and lock a political thread without comment. In fact, that was the last time we ever saw him.

Strict?  As long as I've been here there's been political arguments.  I remember only Andrew always bringing an unbiased tolerance until a flame war. 

You are correct, I misremember. On the moderators board (which is no longer active) Andrew was always concerned about flamewars breaking out, and he shot down the idea of a separate politics board because he didn't want to encourage political discussions, but he did always allow polite conversations.

[ralfy]

Thanks, Lester.

For context, in one discussion about nuclear power, I pointed out that industrialized countries have reached their peak due to a combination of population aging and high incomes, which is why they've focused on at best specialized manufacturing. Everything else has been outsourced to other countries. Outsourcing refers to transferring parts of businesses to other places. It's also done when the customers there start increasing, and it's practical because that's cheaper than manufacturing at home and then shipping what's produced to those markets.

That outsourcing is one of the reasons for the East Asian Miracle.

To spice things up using movies, remember that funny part from the black comedy Dr. Strangelove (again, black comedy isn't a comedy about blacks but sarcastic comedy) about "bloody good cameras"?

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Before the war, Japan was known only for making cheap crap: cheap, wooden toys and paper items. Locally, though, they could engage in heavy industry, but only in limited qualities.

But by the sixties, they began to make "bloody good cameras," and thanks to compulsory licensing: they had laws requiring foreign companies to allow local ones to license products. From there, they not only came up with rebadged products but even surpassed foreign companies through innovation, thanks to MITI mentioned earlier.

The same thing soon happened to Taiwan, South Korea, and many of the other countries mentioned earlier. And for those who don't care, very likely you unwittingly do, as the computers and many things you use now involve components made in these countries, if not the products themselves.

Heard of Samsung? That was virtually unknown worldwide since the early 2000s until it overwhelmed Nokia, which in turn was virtually known for decades. In other markets, it dominated over Sony.

Remember the discussions on your favorite stuff from previous decades? Where did Magnavox and RCA go? By the early 1990s, economists like Robert Reich began to refer to U.S. companies with many owners coming from the Middle East and Asia, the engines designed in Germany, advertising handled in France, call centers in Singapore, components coming from various South American and Asian countries, etc., and where the only thing "American" is the brand. The same thing for British brands now owned and made in China, with China outsourcing to Thailand, Malaysia, the Philippines, and elsewhere.

Last point, and probably the most unusual: remember the Japanese "cheap crap" pointed I raised above? One would like to think that other countries didn't experience similar, but everyone did. As this article pointed out, before China, the China of the world was the U.S. itself, as it took advantage of Britain:

http://archive.boston.com/news/globe/ideas/articles/2007/08/26/a_nation_of_outlaws/

China may be a very different country, but in many ways it is a younger version of us. The sooner we understand this, the sooner we can realize that China's fast and loose brand of commerce is not an expression of national character, much less a conspiracy to poison us and our pets, but a phase in the country's development. Call it adolescent capitalism, if you will: bursting with energy, exuberant, dynamic. Like any teenager, China's behavior is also maddening, irresponsible, and dangerous. But it is a phase, and understanding it that way gives us some much-needed perspective, as well as some tools for handling the problem. Indeed, if we want to understand how to deal with China, we could do worse than look to our own history as a guide.

A bit of empathy might even be in order. One hundred and fifty years ago, even America's closest trade partners were despairing about our cheating ways. Charles Dickens, who visited in 1842, was, like many Britons, stunned by the economic ambition of our nation's inhabitants, and appalled by what they would do for the sake of profit. When he first stepped off the boat in Boston, he found the city's bookstores rife with pirated copies of his novels, along with those of his countrymen. Dickens would later deliver lectures decrying the practice, and wrote home in outrage: "my blood so boiled as I thought of the monstrous injustice."

[Allhallowsday]

...
To spice things up using movies, remember that funny part from the black comedy Dr. Strangelove (again, black comedy isn't a comedy about blacks but sarcastic comedy) ...

You spice nothing up by condescending to "again" point out to us what black comedy is not.  You are tiresome. 

[ralfy]

...
To spice things up using movies, remember that funny part from the black comedy Dr. Strangelove (again, black comedy isn't a comedy about blacks but sarcastic comedy) ...

You spice nothing up by condescending to "again" point out to us what black comedy is not.  You are tiresome. 

Condescending, you say? From the same forum member whose main contribution to these types of threads consists of inane 4chan-level memes? I won't be surprised if you do that again in response to this post! But to prove me wrong, and so that we can remain on-topic, how'd you like to give at least a mature (never mind intelligent!) response this?

"A financially inefficient economy"

https://businessmirror.com.ph/2022/12/19/a-financially-inefficient-economy/

It is short-term cheaper, but not long term financially efficient, to import thread and clothes from China than to import raw materials and produce the products locally. Our current farming methods can be best seen in “Farmers Working and Resting,” Fernando Amorsolo’s 1955 painting. Mechanized rice farming doubled production efficiency in China. Thailand started its mechanized rice farming program the same time Amorsolo finished his painting. What would the Philippines possibly be like without our world-famous jeepneys and tricycles? Two words: much better.

For context, unlike its Asian neighbors, the Philippines followed the U.S. neoliberal model of letting markets decide. The results:

Its agricultural output as a share of its economy started dropping since the early 1970s, and has been low since. Take note that it is a country rich in natural resources, including arable soil thanks to volcanic activity. Today, the average age of its farmer is in the late 50s, and they've been selling land to real estate developers.

Its manufacturing output also dropped dramatically as a share of its economy, and has been doing so since the late 1980s.

So, what do you think happened next? If you guessed service sector, then you're right. But how do you export services? Here's the weird thing about that story:

Ever wonder why your caregivers and nurses include lots of Filipinos? That's because large numbers of them have been leaving the country to find work abroad, while other countries face aging populations (e.g., many towns and cities with an average age in the mid-50s and fewer people having children). They've been leaving because pay's poor and prices, taxes, and unemployment's high.

How's this connected to the topic? The country has not been following the East Asian Model since the late 1980s, and did so only briefly during the 1950s and 1970s. The result is that it has one of the lowest ave. economic growth rate in the region: around 1.6 pct compared to 4-5 pct. on average for the others, and 6-7 pct. for China.

So, the simple solution's to do the opposite, right? But there's a catch.

[Allhallowsday]

...
To spice things up using movies, remember that funny part from the black comedy Dr. Strangelove (again, black comedy isn't a comedy about blacks but sarcastic comedy) ...

You spice nothing up by condescending to "again" point out to us what black comedy is not.  You are tiresome. 

Condescending, you say...?

YES.

[ralfy]

...
To spice things up using movies, remember that funny part from the black comedy Dr. Strangelove (again, black comedy isn't a comedy about blacks but sarcastic comedy) ...

You spice nothing up by condescending to "again" point out to us what black comedy is not.  You are tiresome. 

Condescending, you say...?

YES.

Why are you exempted from that?

And what do you think of the article from the Business Mirror?