A Region of Regimes

Prosperity and Plunder in the Asia-Pacific

T. J. Pempel

• Publisher: Cornell University Press
• Year: 2021
• ISBN:
  9781501758812
• Topic: Política y relaciones internacionales
• Subtopic: Política asiática

A Region of Regimes traces the relationship between politics and economics—power and prosperity—in the Asia-Pacific in the decades since the Second World War. This book complicates familiar and incomplete narratives of the "Asian economic miracle" to show radically different paths leading to high growth for many but abject failure for some. T. J. Pempel analyzes policies and data from ten East Asian countries, categorizing them into three distinct regime types, each historically contingent and the product of specific configurations of domestic institutions, socio-economic resources, and external support.

Pempel identifies Japan, Korea, and Taiwan as developmental regimes, showing how each then diverged due to domestic and international forces. North Korea, Myanmar, and the Philippines (under Marcos) comprise "rapacious regimes" in this analysis, while Malaysia, Indonesia, and Thailand form "ersatz developmental regimes." Uniquely, China emerges as an evolving hybrid of all three regime types. A Region of Regimes concludes by showing how the shifting interactions of these regimes have profoundly shaped the Asia-Pacific region and the globe across the postwar era.

PART ONE

Chapter 1

Developmental Regimes

Japan, Korea, and Taiwan

The stunning economic transformations of Japan, Korea, and Taiwan constituted the first waves in the subsequent tsunami of national economic successes that swept across East Asia. Each of the three overcame daunting barriers left from World War II (and for Korea, the conflict of 1950–53) to deliver decades of sequential GDP growth rates that were roughly double that of the industrialized world. Each accumulated capital, invested heavily in domestic production facilities and national infrastructure, and created forward and backward linkages among sophisticated corporations and sectors, laying strong foundations for ongoing product innovation and industrial deepening. In the process, each also gained steadily larger shares of world exports, stronger currencies, and ballooning foreign reserves.

Increased economic sophistication brought broad-scale citizen inclusion and patterns of income distribution that, by international standards, were quite egalitarian. Of critical significance, heavy reliance on indigenous capital and national ownership ensured that the bulk of the benefits from increased productivity would redound predominantly to locals rather than escaping to foreign coffers.

This chapter argues that such economic achievements arose in tandem with a specific type of regime in Japan, Korea, and Taiwan, and a particular economic paradigm. The three national experiences, though not identical, were sufficiently analogous in a number of fundamentals to treat them as a group.¹ They provide empirical manifestations of what I label “developmental regimes.”

All three had strong and cohesive state institutions; each had concentrated and dominant progrowth socioeconomic coalitions; all received extensive security and economic support from the United States and enjoyed the benefits of global financial and trade institutions. Each regime bonded around what Slater has labelled “protection pacts.” Driven by a shared sense of existential threat, foreign and domestic elites joined together to advance an economic policy paradigm that I label “embedded mercantilism.” Core components included industrial policy, undervalued currencies, export expansion, and rapid industrialization, all advancing behind institutional bulwarks against the perceived threats.²

As their national economies took flight, growth provided positive feedback that reinforced cohesion among key regime components while marginalizing potential regime opponents and alternative economic paradigms. Each regime gained greater internal cohesion, legitimacy, and institutional enmeshment. Stronger regimes, in turn, reinforced the economic paradigm, the two continuously buttressing one another in a “virtuous cycle.”

Considerable analysis has stressed the centrality of state institutions, particularly the civil service, in the economic transformations of Japan, Korea, and Taiwan. Strong and coherent state institutions were undoubtedly necessary for that transformation, yet state institutional strength alone was by no means sufficient. Equally critical was the nature of two other key regime components, notably cohesive progrowth socioeconomic coalitions and consistent and powerful external backing. All three cohered to form what I categorize as “developmental regimes” that in turn steadily advanced transformative national economic paradigms. The result was radical and rapid industrial transformation.

State Institutions

Although many states might have the intention to achieve economic development, far fewer show a capacity to do so. An exchange in Shakespeare’s Henry IV captures the distinction. Glendower, touting his alleged powers, announces, “I can call spirits from the vasty deep.” The response from Hotspur punctures such arrogance, “Why, so can I, or so can any man, but will they come when you do call for them?”³

To forge and implement an economic policy paradigm capable of calling forth the spirits critical for development, cohesive state institutions designed for decisiveness are an invaluable asset. Unlike the more fragmented state structures found in much of Latin America, Africa, and the Middle East,⁴ Japan, Korea, and Taiwan had state institutions designed for decisive action rather than for minority voice, extensive representation, and compromise. State authorities could focus with unblinking eyes on the lodestar of economic catch-up so that it became what Linda Weiss categorized as the nation’s “transformative project”⁵ and Bob Jessop branded its “hegemonic project.”⁶

Strong and cohesive state institutions had deep historical roots in Japan, Korea, and Taiwan.⁷ In the late nineteenth century, the Japanese ruling elite, anxious to escape the colonial depredations forced on most of the nonwhite world, took a constitutional leaf from Bismarck’s Germany to configure governmental structures that concentrated, rather than dispersed, political power.⁸ Citizen duties were extensive; their rights were few. Unsurprisingly, political parties and Parliament had to cope with elaborately constructed barriers denying them the influence many of their counterparts enjoyed in parts of Western Europe, Latin America, and the United States.

Without gainsaying the imbalance in power between colonizer and colonized, decades under Japanese imperial rule bequeathed state institutions to Korea and Taiwan that replicated those of their colonizer; trained and talented indigenous officials became the norm in all three countries.⁹ The postwar governmental structures of all three continued the predisposition toward state institutional strength.

A substantial body of scholarship on Japan, Korea, and Taiwan privileges state institutions as the key to their economic success. Under the collective label of developmental states, these three each had a “pilot agency,” composed of technically competent civil servants chosen through meritocratic processes who oversaw extensive mechanisms of control.¹⁰ They used those institutional tools with cohesion, capacity, and disposition to advance a consistent agenda.¹¹

Yet state bureaucrats were hardly autonomous operatives.¹² No matter their talents, they did not operate in a political vacuum; rather, they were at most valuable flywheels in a more extensive machinery of state institutions, rarely free to generate their own policy agendas. Nor were the goals they pursued self-evident.¹³ Indeed, as Weber’s analysis of bureaucracy makes clear, the rules by which bureaucrats operate are not self-generated but emanate from outside the bureaucrat cubicles.

At the apex of all three state systems was a more extensive and cohesive executive authority. In Japan’s case, that ultimate authority controlling state institutions was the electorally dominant Liberal Democratic Party (LDP).

Japan, unlike Taiwan and Korea, began the postwar years as a constitutional democracy with a panoply of guarantees concerning citizen sovereignty, parliamentary power, and competitive elections together with press freedom and citizen rights.¹⁴ For the first decade or so following World War II, Japanese state institutions struggled for direction amid brutal street battles and wide-ranging social and political uncertainties. A succession of coalition governments rotated into and out of Parliament and the prime minister’s office, focused far more on geopolitical and security issues than on economic transformation.¹⁵

Finally, in 1955, several previously separate conservative parties, under strong pressure from the powerful business sector as well as the US government, combined forces to form the Liberal Democratic Party. Over the next four decades, the LDP consistently secured twice as many parliamentary seats as the second largest party. Electoral supremacy, in turn, gave the party sole control of all cabinet posts until 1993, marking Japan as one of a limited number of democracies manifesting one-party dominance.¹⁶

As a result, although Japanese economic bureaucrats enjoyed considerable tactical flexibility, they remained subject to strategic direction from the LDP.¹⁷ The LDP retained that institutional superiority only by consistent victories at the ballot box. Consequently, the LDP was not free from constraints in advancing the country’s policy paradigm; it also had to be an effective vote-mobilizing machine. Electoral effectiveness was essential if the LDP was to control the state apparatus for long enough periods to orchestrate a full-fledged economic transformation. Indeed, the long-ruling LDP was primarily a political machine organized to win elections and less one to govern the country. The LDP consequently off-loaded far more details of governance to the national bureaucracy than was true in the other two developmental regimes.

Neither the KMT (Kuomintang) nor the Korean military junta faced such electoral constraints. Instead, for the first decades of their economic transformations both Korea and Taiwan were under tight military control, authoritarian regulations, and extensive citizen surveillance. In Taiwan, a pervasive and powerful KMT bolstered bureaucratic actions while in Korea the personal support parties of successive autocratic presidents did the same.¹⁸

In Korea, state institutional cohesion became consolidated following the 1961 coup that brought Park Chung-hee and his military junta to power. For the next three decades, there was little doubt about the strength and cohesion of Korean state institutions. The military chain of command, combined with extensive constitutional powers afforded the president, ensured pointed and hierarchical cohesion across state institutions. Furthermore, the KCIA (Korean Central Intelligence Agency) and a shadow cabinet bolstered both state cohesion and citizen control.

Soon after he took power in May 1961, Park made it clear that the military would play the lead role in the regime. Only the military, he argued, had the organizational cohesion and hierarchical clarity to purge the country of what he saw as its two major problems—corruption and poverty. By arresting numerous leaders from the business community on corruption charges, Park established the unmistakable dominance of state over society, of politics over profits. Only after receiving business assurances of its willingness to cooperate with his political goals were chaebol leaders permitted to run their business operations with some measure of independence.¹⁹ Until his assassination in 1979, Park exerted iron-fisted oversight of economic development policies, labeled “The Big Push.” This combination of military and presidential power continued with only minimal challenge until the introduction of free elections in 1988.

Security concerns were hardly subservient to economic growth; however, Park and his followers concluded that national security necessitated economic transformation. Steel, shipbuilding, electronics, and infrastructure were essential for the production of weapons and the deterrence of aggressors, particularly the menacing regime to the North. The political leadership thus fused the two goals of military security and economic development, treating them not as trade-offs but as intimate partners, even though that intimacy resulted in major cuts to the military’s share of the national budget.²⁰

Economic bureaucrats remained subject to presidential commands. Park’s inspiration was a logical outgrowth of his background: the top graduate in his class at a Japanese military academy; an officer trained at the Tokyo Military Academy; and subsequent service in Manchuria, where he participated in advancing economic development under Japanese military rule and industrial planning. In addition, Park had seen the ease with which North Korea in 1950 swept over the hapless Rhee Syngman government, as well as Rhee’s reliance on a social coalition of absentee landowners and corrupt import-substituting industrialists, a point developed below.²¹

Korea’s concentration of decision-making authority in hierarchical state institutions, along with the systematic suppression of opposition forces, continued into the late 1980s (and even after the military gave way to civilian rule, presidential predominance remained daunting). In Korea under Park, the president appointed roughly one-third of the Assembly members. Opposition politicians confronted legal bans on their political activity and a government-run media that impeded citizen support and funding for opposition parties. Between 1948 and the mid-1980s, one hundred or more political parties rose and fell. Most lacked money and influence, serving largely as transient entities cobbled together as the personal networks of prominent figures, rather than as cohesive, popularly anchored, and programmatic political parties.²² Few played any meaningful part in checking state institutions, a situation that contrasted with both Japan and Taiwan.

In Taiwan following the takeover by Chiang Kai-shek’s forces in 1949, state institutions centered on alignments among Chiang personally, his supportive KMT, and the military. From the time of his arrival on the island in 19...