East Asia's Reemergence

Philip S. Golub

• Publisher: Polity
• Year: 2016
• Print ISBN: 9780745664668, 9780745664651
• eBook ISBN: 9781509506675
• Edition: 1
• Topic: Politics & International Relations
• Subtopic: Asian Politics
• Index: Politics & International Relations

East Asia has re-emerged after a long eclipse as a centre of world wealth creation and growth. Over the past four decades the region's share of world GDP has risen from less than 10 to 30 percent, a ratio that is set to rise to 40 percent by 2030.

What has made East Asia's remarkable ascent possible, and what does this economic rebalancing between East and West mean for world politics? In this insightful and provocative book, Philip Golub addresses these questions, tracing the region's rise from the early modern European-Asian encounter to the imperial confrontations of the nineteenth century, and China's state capitalist turn in the latter half of the twentieth century. Together, he argues, the dynamics of imperialism, war and revolution led to the constitution of developmental states that made possible East Asia's return to a central position in the global economy.

Combining rich historical narrative and social theory, this book is an invaluable guide to one of the core issues in world politics today.

1
GLOBALIZATION, EAST ASIA, AND THE DYNAMICS OF CAPITALIST DEVELOPMENT

The unequal division of the modern world into North and South and East and West has always been one of the core problems of social theory and one of the main lines of fracture of world politics. In the course of the long Industrial Revolution and Europe’s synchronous movement of formal and informal imperial expansion in the nineteenth century, an increasingly interdependent but stratified world system came into being that was centered in the Atlantic and ordered by the West. If European overseas expansion and conquest began in the early modern period with the colonization of the Americas and the commercial penetration of Asia by the various East Indian companies, it was only in the late-modern period that imperialism took world-encompassing scope. Drawing on the energies of modern capitalism and made possible by technical evolutions (steamships, the telegraph, railways, and of course guns) that transformed the spatial and temporal conditions of transnational relations, Europe’s late-modern “conquest of the universe” put an end to the “multi-secular era” in which various relatively equal and relatively autonomous économies-mondes (world economies) had coexisted and interacted in a plural and polycentric world without a dominant center of economic or political gravity (Braudel, 1992).

As imperial globalization unfolded over space and time, European guns and commodities battering down “all Chinese walls,” the longstanding parity between East and West was supplanted by a new and durable hierarchical world order characterized by structural North–South and East–West asymmetries. Asia, for centuries the locus of advanced societies and sophisticated commercial cultures, became enmeshed in the webs of European empire and the Atlantic-centered world market. Great Britain, the first industrializer and most expansive European colonizer, was the primary, though not the sole, agent of this tectonic shift. Britain, Hobsbawm writes, became the systemic center of a new international division of labor characterized by “a set of economies dependent on and complementary to the British, each exchanging the primary products for which its geographical situation fitted it for the manufactures of the world’s workshop” (Hobsbawm, 1990: 136). At the height of British economic predominance in the 1860s, when Britain accounted for 20 percent of world manufacturing, more than half of global coal, iron and cotton cloth production, and over a third of world steampower, observers noted that the “several quarters of the world,” from the Americas through the Mediterranean to the Far East and Australia, had become Britain’s “tributaries” (Jevons, 1865: 16.2). At the time, approximately 300 million people had been incorporated into European overseas empires—86 percent in British Crown colonies, and many millions more in the magnetic fields of the vast informal empire instituted by the “imperialism of free trade” (Gallagher and Robinson, 1953). By the end of the century, at the apogee of late-modern globalization and the nearly complete internationalization of economic life (Keynes, 1920), the population in the formal empires producing the sugar, tea, spice, cereals, cotton and other raw materials and commodities destined to the world market had reached 553 million, of which 393.8 million were under direct British rule (Bairoch, 1997, Vol. 2: 608–9). When semi-sovereign partially colonized states such as China and the nominally autonomous but economically subordinate societies of Latin America are included, nearly half the world population had been enmeshed in the regimes and controls of empire. Aside a few important exceptions, notably Meiji Japan, which managed to preserve its political autonomy and avoid economic entrapment through its own industrial revolution and the building of a modern state, and which went on to play a major role in interimperialist competition in Asia, the overall outcome of late-modern globalization was the great divergence (Pomeranz, 2000) between East and West and the division of the world into dominant cores and dependent peripheries.

Rather than spreading outside of Europe and leading to convergence, the Industrial Revolution generated asymmetric interdependence. Because of the patterns of specialization instituted by colonial regimes, industrialization and economic expansion in the northern Atlantic world conditioned other world regions, warping or arresting development in the newly constituted peripheries (Parthasarathi, 2001), whose living standards stagnated and whose share of world income declined sharply throughout the nineteenth century. According to Paul Bairoch’s thorough if necessarily approximate estimates, peripheral living standards, measured by average per capita output, were only marginally higher in 1900 than they had been in 1750, whereas they had more than tripled on average in the newly industrialized economies of Europe and the neo-European settler colonies. The disparity was even greater with the most industrialized countries, where average per capita output was four (Britain) to five (United States) times higher (Bairoch, 1997). The limited industrialization that did occur in colonial or semi-colonial areas in the late nineteenth century—for instance the construction of railroads and infrastructure to facilitate commodity transport to ports that shipped goods to Northern markets, or the creation of new textile manufacturing facilities in India—did not produce the cumulative results of self-sustaining growth, integration of national markets, and rising overall living standards observable in Europe. Rather, it elicited new patterns of spatial unevenness: the structure of international production and trade generated demographic inflation and unbalanced urbanization in coastal trading centers that became warehouses for the primary products and staples destined for the world market. If there were some pockets of quantitative development in India or Qing China, due to local entrepreneurship, capitalist modernity in colonial or semi-colonial Asia became coterminous with unevenness and durable international inequality. Europe’s “machine revolution,” Braudel aptly writes, was “not merely an instrument of development” but “a weapon of domination and destruction of competition” (Braudel, 1992: 535).

This outcome was not quite the one envisioned by Marx in his brilliant albeit Eurocentric depiction and analysis of late modern globalization and capitalist development. Writing from within the systemic transformation, he observed that the development and internationalization of “colossal productive forces” had “given a cosmopolitan character to production and consumption” and generated “universal inter-dependence” in a world economy integrated through transnational flows (Marx and Engels, 1978). Thanks to the “rapid improvement of all instruments of production [and] the immensely facilitated means of communication,” Europe was incorporating the rest of the world into its developmental movement, making “barbarian and semi-barbarian countries dependent on the civilized ones, nations of peasants on nations of bourgeois, the East on the West.” Just as the emergence of capitalism in England flowed from a process of progressive historical change, he envisioned Europe’s worldwide economic and spatial expansion as part of a necessary movement of the world toward industrial and urban civilization, hence human liberation from natural constraints and the “idiocy of rural life.” By drawing Asia into the developmental logic of capitalism and enmeshing her in the “net of the world market,” European imperialism would hasten the transition from “oriental despotism” and the “village system” to industrial capitalism. Europe’s intrusion in India and China would destroy stagnant socioeconomic systems and revolutionize the “social state in Asia,” thereby “fulfilling mankind’s destiny” to be the “sovereign of nature” (Marx, 1963: 35-41).

Marx was well aware of the great violence of the incorporation process, devoting many eloquent pages to the “atrocious exploitation” of India and to “English ferocity in China.” He showed acute interest in contemporary national uprisings in China and India that, he believed, would help to spark revolution in Europe.¹ But he detached analytical and normative judgments in his theory of history and his analysis of capitalist development. Violence was foundational to the revolutionary rise and expansion of the world capitalist system: “The discovery of gold and silver in America, the extirpation, enslavement and entombment in mines of the aboriginal population, the beginning of the conquest and looting of the East Indies, the turning of Africa into a warren for the commercial hunting of black-skins, signalised the rosy dawn of the era of capitalist production” (Marx, 1977: 751). As the Industrial Revolution matured, thanks to this first or “primitive” phase of capital accumulation, England became the midwife of modernity in Asia: “Whatever may have been the aims of England, she was the unconscious tool of history in bringing about the revolution . . . England has to fulfil a double mission in India: one destructive, the other regenerating—the annihilation of the old Asiatic society, and the laying of the material foundation of Western society in Asia” (1963: 37). Following the “natural laws of capitalist production,” industrialization would spread to the rest of the world. Precapitalist systems of social reproduction based on subsistence agriculture and household manufactures would be supplanted by modern capitalist development. In that sense, the more economically and technologically advanced countries “simply [presented] others with a picture of their future.”

For most of the non-European world, that future never fully materialized. The breakdown of the European world order after the Second World War due to the combined effects of anticolonial resistance and metropolitan exhaustion gave the postcolonial South de jure equality but not effective autonomy. With some major East Asian exceptions—Japan and the People’s Republic of China (PRC), whose modernization and state-building efforts are central concerns of this book—the structural disparities brought about in the late nineteenth century widened considerably. Notwithstanding the promise of self-determination, universal “well being,” “equal rights,” and “economic and social progress and development” contained in the United Nations Charter, average living standards in the postcolonial South were only marginally higher at the time of the Bandung Conference (1955) than they had been in the mid-eighteenth century. Nor did independence lead to an improvement of the relative economic position of most postcolonial Southern states. With three quarters of the world’s population, the global South’s share of world income (around 25 percent) was nearly three times lower than it had been in 1750 (Nayyar, 2013) and its share of world manufacturing output had fallen from over 70 to 6.5 percent. Relative decline was most pronounced in Asia (outside Japan), whose share of world manufacturing (craft and industrial) had fallen from more than 60 percent to less than 5 percent. Per-capita levels of industrialization reveal deep decline: per-capita industrial output in China in 1953 was half what it had been in 1750. In India it was 3.5 times lower. In contrast, per capita industrial production in Japan had been multiplied 5.7 times (Bairoch, 1982).

By the early 1970s the South’s relative position in the world economy had not significantly improved. While its share of world manufacturing output had increased to 9 percent in a much expanded world economy, it nonetheless remained inferior to 1900 levels. The most important gains were concentrated in a handful of industrializing states: in 1970 South Korea, Taiwan, Singapore, Hong Kong, Brazil and Mexico accounted for nearly one third of industrial production, outside of China, in the South. In 1971, the United Nations (UNO) launched the Second Development Decade on a sombre note: “Countless millions of people in the developing world . . . are often still undernourished, undereducated, unemployed and wanting in the many other basic amenities of life. While a part of the world lives in great comfort and even affluence, most of the larger part suffers from abject poverty, and in fact the disparity is continuing to widen” (UN, 1970). Critical observers of international relations and international development specialists were thus well founded when they argued that the “obscene inequalities that disfigure the world” constituted the main theoretical and normative challenge for the social sciences and the fundamental problem of world politics (Seers, 1969). Ambitious efforts by a constellation of postcolonial leaders, international public servants (UNCTAD), theorists and activists in the early 1970s to alter the post-1945 world economic order and institutionalize a global redistributive order (the New International Economic Order), founded on new binding multilateral regimes, failed (Golub, 2013).² Having little world market power and no voice in decisions taken by the most powerful Northern states, the position of many Southern world regions substantially deteriorated in the late 1970s and early 1980s. This was notably the case of Africa and Latin America, which were confronted with exogenously driven debt crises that ushered in economic stagnation and social regression.

In Latin America, parts of which had experienced significant economic gains in the first two decades of the postwar period due to import substitution industrialization (ISI), this led to the end of “peripheral Fordism” and the “asphyxiation of industrialization” (Lipietz, 1984). At the time, the few and rather small industrializing countries of Northeast and Southeast Asia (South Korea, Taiwan, Singapore, Hong Kong) that accounted for the lion’s share of Southern manufactured exports did not appear systemically significant. Despite the beginnings of industrialization and strong growth in the 1970s and early 1980s, the developing capitalist countries of Southeast Asia were still peripheral actors in the world economy. China was contemporaneously swept up in the turbulence of the Cultural Revolution that dislocated the economy and nearly caused a general breakdown. In the early 1980s, the economy was just beginning to recover, thanks to the gradualist market reforms of the post-Mao leadership, and a capitalist transition, the tensions of which erupted into the open during the 1989 mass protests in Tiananmen Square in Beijing. Overall, downward mobility and/or crisis rather than convergence appeared the general trend for much, though not all, of the historic South. At the end of the 1970s the developmental impasse seemed so intractable and the disparities so great that Braudel pessimistically concluded that the South would somehow have to “break down the existing international order” (Braudel, 1992: 535) to gain upward economic mobility and achieve de facto rather than de jure equality.

A historical turn

Fundamental changes in the world economy over the past thirty years have overturned this assessment: due to the economic revolution that has unfolded in East Asia, the vertical world economic structure that came into being in the nineteenth century is being gradually altered from within. As publications of the United Nations Development Program (UNDP) and the World Bank (WB) have recently noted, we are experiencing a historic rebalancing that is leading to the dissolution of the hierarchies that became coterminous with Eurocentric modernity. “Throughout the course of history,” notes the Bank report,

paradigms of economic power have been drawn and redrawn according the rise and fall of states with the greatest capabilities to drive global growth. . . . In the first half of the second millennium China and India were the world’s predominant growth poles. The Industrial Revolution brought West European economies to the forefront. In the post-World War II era, the United States was the predominant force in the global economy. . . . In more recent years the global economy has begun another major transition. . . . The rise of emerging economies will inevitably have major implications for the global economic and political hierarchy. (World Bank, 2011:1)

Announcing the 2013 Human Development Report, the UNDP likewise emphasized: “The World is witnessing an epochal global rebalancing. The rise of the South reverses the huge shift that saw Europe and North America eclipse the rest of the world, beginning with the industrial revolution, through the colonial era to two World Wars in the twentieth century. Now another tectonic shift has put developing countries on an upward curve” (UNDP, 2013). There is ample evidence supporting these claims. Over the past thirty years, the world GDP share of developing countries in purchasing power parity (PPP) has more than tripled, from approximately 15 percent in 1980 to 50 percent; their share of manufacturing value-added has risen from 8.8 to nearly 30 percent; and their share of world merchandise trade from 25 to 47 percent. New regional and transcontinental South–South economic linkages have concurrently come into being that are repatterning the geography of world trade and investment flows. South–South trade has expanded over the past two decades more rapidly than global trade and currently accounts for 25 percent of the total, 21 percent of world manufactures exports, and a quarter of exports of manufactures with medium and high technological intensity. Trade between developed countries fell during the same period from 46 to less than 30 percent (UNCTAD, 2012; UNDP, 2013).

Global rebalancing has been driven by East Asia, which has experienced a process of economic expansion and ascent whose amplitude, spatial scope, and duration have been remarkable by historic standards. Starting with Japan’s revival soon after the Second World War, industrialization and technological upgrading spread sequentially to the newly industrialized countries of Northeast Asia (South Korea, Taiwan), the industrializing countries of Southeast Asia (ASEAN 4) and most consequentially, over the past three decades, to China. East Asia’s aggregate share of constantly growing world GDP in purchasing power parity (PPP) has increased from around 10 percent in the 1970s, more than half of which was attributable to Japan, to 28.8 percent in 2014, with China’s share growing from less than 2 percent to over 15 percent against Japan’s current 5.4 percent (IMF, 2014). By 2020 the region’s share will reach 32 percent and by the end of the following decade it should rise to 40 percent. Per capita GDP (PPP), a finer quantitative measure of development, has grown since 1980 by a factor of 14 in South Korea, 10 in Taiwan, 9 in Singapore and Thaila...

Table of contents

• Cover
• Title Page
• Copyright
• Preface
• 1. Globalization, East Asia, and the Dynamics of Capitalist Development
• 2. Early-Modern Encounters, Late-Modern Collisions
• 3. War-Making and State-Making After 1945
• 4. Developmental States and Flying Geese
• 5. China’s State Capitalist Mutation
• 6. Looking Forward
• Bibliography
• Index
• End User License Agreement