Can Asians Think?

June 1, 1998 Topic: Society Regions: Asia Tags: AcademiaBusinessCold War

Can Asians Think?

Mini Teaser: Realistically, can the rest of the world continue to ride on the shoulders of the West? If Asians double in population in the next fifty years, will they be able to carry their fair share of this burden?

by Author(s): Kishore Mahbubani

In short, Asians who would like to rush and answer "Yes" to the
question posed have more than ample justification to do so. But
before they arrive at a final judgment, I would advise them to pause
once more and reflect on the reasons for believing that, after all,
"Maybe" is the right answer.

The "Maybe" Response

Despite the travails sparked by the financial crisis in late 1997,
most Asians continue to be optimistic about their future. Such
optimism is healthy. Yet it may be useful for Asians to learn a small
lesson in history from the experience of Europeans exactly a century
ago, when Europe was full of optimism. In his 1993 book Out of
Control, Zbigniew Brzezinski described how the world looked then:

"The twentieth century was born in hope. It dawned in a relatively
benign setting. The principal powers of the world had enjoyed,
broadly speaking, a relatively prolonged spell of peace. . . . The
dominant mood in the major capitals as of January 1, 1900 was
generally one of optimism. The structure of global power seemed
stable. Existing empires appeared to be increasingly enlightened as
well as secure."

But despite this great hope, the twentieth century became, in
Brzezinski's words,

". . . mankind's most bloody and hateful century, a century of
hallucinating politics and of monstrous killings. Cruelty was
institutionalized to an unprecedented degree, lethality was organized
on a mass production basis. The contrast between the scientific
potential for good and the political evil that was actually unleashed
is shocking. Never before in history was killing so globally pervasive,
never before did it consume so many lives, never before was human
annihilation pursued with such concentration of sustained effort on
behalf of such arrogantly irrational goals."

One of the most important questions that an Asian has to ask himself
today is a simple one: Can any Asian society, with the exception of
Japan (which is an accepted member of the Western club), be
absolutely confident that it can succeed and do as well in a
comprehensive sense as contemporary advanced societies in North
America and Western Europe have done? If the answer is that there is
none, or even that there are only a few of whom that can be said,
then the case for the "Maybe" response becomes stronger.

There are still many great challenges that Asian societies have to
overcome before they can reach the comprehensive level of achievement
enjoyed by Western societies. The first challenge in the development
of any society is economic. Until the middle of 1997 most East Asian
societies believed that they had mastered the basic rules of modern
economics. They liberalized their economies, encouraged foreign
investment flows, and practiced thrifty fiscal policies. The high
level of domestic savings gave them a comfortable economic buffer.
After enjoying continuous economic growth rates of 7 percent or more
per annum for decades, it was natural for societies like South Korea,
Thailand, Indonesia, and Malaysia to assume that they had discovered
the magical elixir of economic development.

The events following the devaluation of the Thai baht on July 2, 1997
demonstrated that they hadn't. The remarkable thing about this
financial crisis was that no economist anticipated its depth or
scale. Economists and analysts remain divided on its fundamental
causes. As the crisis is still unfolding at the time of writing, it
is too early to provide definitive judgments on those causes. But a
few suggestions are worth making.

On the economic front, many mistakes were made. In Thailand, for
example, the decision to sustain fixed exchange rates between the
baht and the dollar, despite the disparity in interest rates, allowed
Thai businessmen to borrow cheap in U.S. dollars and earn high
interest rates in Thai baht. This also led to overinvestments in
Thailand's property and share markets. All this was clearly
unsustainable. The IMF provided some discreet warnings. However, the
relatively weak coalition governments then prevailing in Thailand
were unable to administer the bitter medicine required to remedy the
situation, because some of it had to be administered to their
financial backers. Domestically, it was a combination of economic and
political factors that precipitated and prolonged the financial
crisis.

There was also a huge new factor that complicated the story: the
force of globalization. The key lesson that all East Asian economic
managers have learned in the 1997-98 crisis is that they are
accountable not only to domestic actors but to the international
financial markets and their key players. The East Asians should not
have been surprised. It was a logical consequence of liberalization
and integration with the global economy. Integration has brought both
benefits (in terms of significant increases in standards of living)
and costs (such as loss of autonomy in economic management). But
there was a clear reluctance to acknowledge and accept the loss of
autonomy. This was demonstrated by the state of denial that
characterized the initial East Asian response to this crisis, a
denial that clearly showed the psychological time lag in East Asian
minds in facing up to new realities.

Significantly, the two East Asian economies that have (after the
initial bouts of denial) swallowed most fully the bitter medicine
administered by the IMF are the two societies that have progressed
faster in developing middle classes that have integrated themselves
into the worldview of the new interconnected global universe of
modern economics. South Korea and Thailand, although they continue to
face serious economic challenges, have clearly demonstrated that
their elitesare now well plugged in to the new financial networks.
The new finance minister of Thailand, Tarrin Nimmanhaeminda, walks
and talks with ease in any key financial capital. His performance is
one indicator of the new globalized Asian mind that is emerging.

The 1997-98 financial crisis also demonstrated the wisdom of the
Chinese in translating the English word "crisis" as a combination of
two Chinese characters, "danger" and "opportunity." Clearly, the East
Asian societies have experienced many dangerous moments. But if they
emerge from the 1997-98 financial crisis with restructured and
reinvigorated economic and administrative systems of management, they
may yet be among the first societies in the world to develop strong
immune systems to handle present and future challenges springing from
globalization. It's too early to tell whether this is true. And this
in turn reinforces the point that on the economic front, one should
perhaps give the "Maybe" answer.

Second, on the political front most Asian societies, including East
Asian societies, have a long way to go before they can reach Western
levels of political stability and harmony. There is little danger of
a coup d'etat or real civil war in most contemporary Western
societies (with the possible exception, still, of Northern Ireland).
Western societies have adopted political variations of the liberal
democratic model, even though the presidential systems of the United
States and France differ significantly from the Westminster models of
the United Kingdom, Canada, and Australia. These political forms are
not perfect. They contain many features that inhibit social progress,
from vested interest lobby groups to pork barrel politics. Indeed, it
would be fair to say that political development in most Western
societies has atrophied. But it has nevertheless atrophied at
comfortable levels. Most of their citizens live in domestic security,
fear no oppression, and are content with their political frameworks.
How many Asian societies can claim to share this benign state of
affairs? The answer, clearly, is very few. And if it is equally clear
that they are not going to enjoy this in the very near future, then
this again militates in favor of the "Maybe" answer.

Third, in the security realm, the one great advantage Western
societies have over the rest of the world is that war among them has
become a thing of the past. The reasons for this are complex. It
includes an awareness of ethnic affinity among Western tribes who
feel outnumbered by the rest of the world's population and also a
sense of belonging to a common civilization. It may also reflect the
exhaustion of having fought too many wars in the past. Nevertheless
it is truly remarkable, when we count the number of wars--and truly
big wars--that the British, French, and Germans have fought with each
other (including two in this century), that there is today almost a
zero chance of war between their countries. This is a remarkably
civilized thing to have achieved, reflecting a considerable step
forward in the history of human affairs. When will India and
Pakistan, or North and South Korea, achieve this same zero prospect
of war? And if the answer is not in the near future, is it reasonable
to suggest that perhaps Asian minds (or the minds of Asian societies)
have not reached the same level as the West?

Fourth, Asians face serious challenges in the social realm. While it
is true that it took the social dislocations caused by the Industrial
Revolution to eradicate the feudal traces of European cultures
(social freedom followed economic freedom), it is still unclear
whether similar economic revolutions in East Asia will have the same
liberating social effects on Asian societies. Unfortunately, many
feudal traces, especially those of clannishness and nepotism,
continue to prevent Asian societies from becoming truly meritocratic,
where individual citizens are able to grow and thrive on the basis of
their abilities and not on the basis of their birth or connections or
ethnic background.

Essay Types: Essay