Asia: The coming fury

[bemildred]

As goods pile up in wharves from Bangkok to Shanghai, and workers are laid off in record numbers, people in East Asia are beginning to realize they aren't only experiencing an economic downturn but living through the end of an era.

For over 40 years, the cutting edge of the region's economy has been export-oriented industrialization (EOI). Taiwan and South Korea first adopted this strategy of growth in the mid-1960s, with Korean dictator Park Chung-Hee coaxing his country's entrepreneurs to export. He did this by, among other measures, cutting off electricity to their factories if they refused to comply.

The success of Korea and Taiwan convinced the World Bank that EOI was the wave of the future. In the mid-1970s, then-Bank president Robert McNamara enshrined it as doctrine, preaching that "special efforts must be made in many countries to turn their manufacturing enterprises away from the relatively small markets associated with import substitution toward the much larger opportunities flowing from export promotion."

EOI became one of the key points of consensus between the World Bank and Southeast Asia's governments. Both realized import substitution industrialization could continue only if domestic purchasing power were increased via significant redistribution of income and wealth, and this was simply out of the question for the region's elites. Export markets, especially the relatively open US market, appeared to be a painless substitute.

http://www.atimes.com/atimes/Asian_Economy/KB11Dk01.html

[madrchsod]

1. they took my craft so i really can`t feel sorry for them

millions of us workers lost their jobs to south east asia in the 70`s and 80`s.

[DavidDvorkin]

2. Just as America took jobs from elsewhere long ago

But in both cases, the workers weren't each other's enemies. The enemy is the bosses.

[Bread and Circus]

3. "Just as America took jobs from elsewhere long ago" ??

America and England were the first two countries to industrialize and mass manufacture, not to mention mechanized farming. So, exactly what's up with the "Just as America took jobs from elsewhere long ago" statement. It seems to fly in the face of the history of industrialization.

[QC]

6. America is bad. Very, very bad.

Whenever something wicked happens somewhere, anywhere, in the world, America did it.

:sarcasm:

[leftstreet]

4. Very interesting article

(snips)

The coming fury
The sudden end of the export era is going to have some ugly consequences. In the past three decades, rapid growth reduced the number of people living below the poverty line in many countries. In practically all countries, however, income and wealth inequality increased. But the expansion of consumer purchasing power took much of the edge off social conflicts. Now, with the era of growth coming to an end, increasing poverty amid great inequalities will be a combustible combination.

Indeed, East Asia may be entering a period of radical protest and social revolution that went out of style when export-oriented industrialization became the fashion three decades ago.

[bemildred]

5. Yeah, us dirty hippies tried to tell them 40 years ago.

We're going to have to learn how to run an economy that is not juiced with "growth" all the time. Now we are going to get a messy adjustment instead of a managed one.