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How Asia Works is one of the best books I've read this year. https://www.amazon.com/dp/B00B3M47VC/ https://www.amazon.com/dp/B00B3M47VC/ The handful of countri

by cheriot 10y ago

How Asia Works is one of the best books I've read this year. https://www.amazon.com/dp/B00B3M47VC/ https://www.amazon.com/dp/B00B3M47VC/ The handful of countries than have industrialized in the 20th century (Japan, Taiwan, South Korea) have taken similar paths that are very different than the policies suggested by the IMF and the World Bank. This Economist article, despite the positive tone, makes Vietnam sound more like the stalled developments in Malaysia than the success of South Korea.

RobertoG 10y ago
"The handful of countries than have industrialized in the 20th century (Japan, Taiwan, South Korea) have taken similar paths that are very different than the policies suggested by the IMF and the World Bank" That can't be stressed enough. What has been done, by the IMF and associates, in the name of "development" have caused innumerable suffering. Of course, the people responsible of those policies not only are not challenged but generously rewarded.
- sprafa 10y ago
  Will they be remembered as mass murderers I wonder ? How many people have died due to IMF policy by this point ? In Portugal alone I had to watch people go out in the street and almost starve. This was in a small Catholic town, where everyone (including myself) where constantly trying to help them. But there was just almost nothing left. I was living with my parents along with my 3 brothers, now work in London. And here it's no different. Hundreds of thousands, maybe more, are homeless and perhaps even starving. For what purpose?
  - varjag 10y ago
    Thing is, IMF "advice" that you have to take is most often given along with loan package, where the recipient country is already in shambles - typically due to policies of their own. I see IMF as a convenient externalization of responsibility by national politicians and people who voted for them and their disastrous policies. If the bottom falls out of your country, it's not necessarily someone's nefarious plot.
    - RobertoG 10y ago
      Thing is, that's not true. The goal is profiting from those countries or, as in the case of Europe now, to force policies more 'pro-business' or, in other words, less 'pro-people'. We are talking about disastrous policies imposed from the outside with, yes, normally, the compliance of a local corrupt establishment. I recommend reading this: https://www.globalpolicy.org/component/content/article/209/42969.html https://www.globalpolicy.org/component/content/article/209/4...
      - varjag 10y ago
        I beg to disagree. The advice tends to be "pro-market" and less "pro-populist" by necessity, since IMF is concerned with a living chance of seeing its money back and less so with being popular on elections in recipient country. Then there's always that option of not taking IMF money.
        RobertoG 10y ago
        "Then there's always that option of not taking IMF money." Is there? Who have this option when the people in power is going to profit immensely. The IMF is an institution that have expired its utility. It made sense when there was fixed exchange rate between countries. Since then, it has mutated to an instrument to impose policies that doesn't work. That's a fact. We could, I suppose, argue about the reason of why those policies are imposed and not others. It could be profit or it could be ideological but we can't argue about the results in contraposition to the results of countries that don't follow that development path.
        ptaipale 10y ago
        If IMF has expired its utility, then the option of not taking IMF money very obviously is there and we can concentrate on some other ideas. What might they be?
        RobertoG 10y ago
jpatokal 10y ago
It sounds like Vietnam has done a much better job of keeping politics out of private industry though. Compare with Malaysia and its blatantly racial (and often harebrained) preference schemes, which end up stifling growth and encouraging talented non-Malays to GTFO. https://en.wikipedia.org/wiki/Bumiputera_(Malaysia)#Policy https://en.wikipedia.org/wiki/Bumiputera_(Malaysia)#Policy
- contingencies 10y ago
  All of the business owners I surveyed verbally in Vietnam earlier this month outlined horrific amounts of government red tape and informal facilitation payments for even the slightest bureaucratic requirements. That includes both locals and foreigners.
  - drzaiusapelord 10y ago
    I find it interesting that most post-Communist societies don't ever really get rid of their Communist-era massive bureaucracies. There's never any clean-up or reform, nor any real moves to weed out corruption. Its just one day the red tape goes from centrally planned projects to capitalist projects. Often, the real red tape cutting means a culture bribes and other favors towards government officials. Russia is a pretty good example of how high-corruption and bloaty bureaucracy remains post-Communism. Businesses there just consider bribes part of their budget.
    - NhanH 10y ago
      Has any country, ex-Communist or otherwise, ever been able to clean up/ tone down their bureaucracies, except the case of a total collapse?
      - oli5679 10y ago
        East-Germany arguably doesn't count because of the impact of the reintegration with West-Germany. Excluding this, Estonia has the highest rank in the 'Doing Business' Index of a former Communist state, and Czech Republic has highest GDP/capita. Both are significantly less bureaucratic than USSR days... https://en.wikipedia.org/wiki/List_of_countries_by_GDP_%28PPP%29_per_capita https://en.wikipedia.org/wiki/List_of_countries_by_GDP_%28PP... http://www.doingbusiness.org/rankings http://www.doingbusiness.org/rankings
cageface 10y ago
I've spent the last six years in Vietnam and the progress the country has made in that time is evident everywhere. There's been a lot of reckless development and many people have been left behind but there's no doubt there's also a growing middle and upper class. Corruption is endemic and is certainly one of the reasons Vietnam is no South Korea but it's also not the worst-run country in the region. You know things are changing when more and more American Vietnamese are coming back to start businesses here.
- cheriot 10y ago
  The original Asian Tigers included Thailand, Malaysia, and the Philippines when they boomed in the 90s. After the '98 crises, though, none of them were able to get back on track. There's good and bad ways to feed a boom in the short term. I hope Vietnam figures it out. I was there for a month earlier this year and it's a fantastic place.
  - cageface 10y ago
    Vietnam has its ups and downs like every country but I can't think of anywhere else I'd rather live right now. Every day feels like an adventure.
    - cylinder 10y ago
      Which city?
      - cageface 10y ago
        For most of that time I was in Nha Trang but moved to Da Nang earlier this year.
  - simonebrunozzi 10y ago
    Singapore was an Asian Tiger, too - and it did very well. You should have included it in your list.
jstanley 10y ago
> The handful of countries than have industrialized in the 20th century (Japan, Taiwan, South Korea) have taken similar paths that are very different than the policies suggested by the IMF and the World Bank. Can you elaborate on this? I know nothing about either their policies or the IMF+World Bank's policies. What are they and how do they differ?
- cheriot 10y ago
  Developing countries are influenced by rich countries along the lines of https://en.wikipedia.org/wiki/Washington_Consensus https://en.wikipedia.org/wiki/Washington_Consensus. To poorly summarize the book, the path that works is 1. Land reform to give small plots to families. This boosts yield and turns unskilled labor into foreign currency. 2. Protectionist policies balanced by government requirements to export so companies have to innovate instead of milking the local market. 3. Financial controls to prevent capital flight and make capital available to strategic industries. Often at the expense of savers. I highly recommend this book to anyone interested in History, Economics, or Current Events.
  - Nokinside 10y ago
    This is exactly how Finland became developed country. 1. Land reform 1918. 2. Protectionist policies, import restrictions and increasing exports trough war reparations after WWII. 3. Strict financial controls and industrial policies. Finland ended financial controls in 80's. (Most Nordic countries ended their financial regulations in the 80's).
    - ptaipale 10y ago
      The interesting point in Finnish case is that the land reform was (at least nominally) a central requirement of the Red faction in the development leading to civil war in spring 1918. The White faction won the war, and it ended in a bloodbath. with the Reds severely repressed. But the law about land reform was approved two months after the civil war ended. Twenty years later, when Soviet Union attacked the country as Stalin believed the Reds still wanted a retribution, he faced a unified nation where the sons of Reds and Whites alike fought together, well enough to avoid occupation at the end of WWII, though the reparation payments were heavy indeed. And then, at present day, many people say that "the land reform was the biggest mistake of the century" because it created lots of small farms instead of big, centralized agriculture. Anyway, giving people a patch of their own land seems to be a good way to commit them to defend and work for it.
bobcostas55 10y ago
This is a very bad post hoc ergo propter hoc argument. There's no reason to believe that going against IMF advice helped. Many, many nations that did NOT industrialize also went against IMF advice. You need to show a direct connection between the two. Which you can't.
- nabla9 10y ago
  Arguments and data are in the book.

by cheriot 10y ago

RobertoG 10y ago

"The handful of countries than have industrialized in the 20th century (Japan, Taiwan, South Korea) have taken similar paths that are very different than the policies suggested by the IMF and the World Bank" That can't be stressed enough. What has been done, by the IMF and associates, in the name of "development" have caused innumerable suffering. Of course, the people responsible of those policies not only are not challenged but generously rewarded.

sprafa 10y ago
Will they be remembered as mass murderers I wonder ? How many people have died due to IMF policy by this point ? In Portugal alone I had to watch people go out in the street and almost starve. This was in a small Catholic town, where everyone (including myself) where constantly trying to help them. But there was just almost nothing left. I was living with my parents along with my 3 brothers, now work in London. And here it's no different. Hundreds of thousands, maybe more, are homeless and perhaps even starving. For what purpose?
- varjag 10y ago
  Thing is, IMF "advice" that you have to take is most often given along with loan package, where the recipient country is already in shambles - typically due to policies of their own. I see IMF as a convenient externalization of responsibility by national politicians and people who voted for them and their disastrous policies. If the bottom falls out of your country, it's not necessarily someone's nefarious plot.
  - RobertoG 10y ago
    Thing is, that's not true. The goal is profiting from those countries or, as in the case of Europe now, to force policies more 'pro-business' or, in other words, less 'pro-people'. We are talking about disastrous policies imposed from the outside with, yes, normally, the compliance of a local corrupt establishment. I recommend reading this: https://www.globalpolicy.org/component/content/article/209/42969.html https://www.globalpolicy.org/component/content/article/209/4...
    - varjag 10y ago
      I beg to disagree. The advice tends to be "pro-market" and less "pro-populist" by necessity, since IMF is concerned with a living chance of seeing its money back and less so with being popular on elections in recipient country. Then there's always that option of not taking IMF money.
      - RobertoG 10y ago
        "Then there's always that option of not taking IMF money." Is there? Who have this option when the people in power is going to profit immensely. The IMF is an institution that have expired its utility. It made sense when there was fixed exchange rate between countries. Since then, it has mutated to an instrument to impose policies that doesn't work. That's a fact. We could, I suppose, argue about the reason of why those policies are imposed and not others. It could be profit or it could be ideological but we can't argue about the results in contraposition to the results of countries that don't follow that development path.
        ptaipale 10y ago
        If IMF has expired its utility, then the option of not taking IMF money very obviously is there and we can concentrate on some other ideas. What might they be?
        RobertoG 10y ago

jpatokal 10y ago

It sounds like Vietnam has done a much better job of keeping politics out of private industry though. Compare with Malaysia and its blatantly racial (and often harebrained) preference schemes, which end up stifling growth and encouraging talented non-Malays to GTFO. https://en.wikipedia.org/wiki/Bumiputera_(Malaysia)#Policy https://en.wikipedia.org/wiki/Bumiputera_(Malaysia)#Policy

contingencies 10y ago
All of the business owners I surveyed verbally in Vietnam earlier this month outlined horrific amounts of government red tape and informal facilitation payments for even the slightest bureaucratic requirements. That includes both locals and foreigners.
- drzaiusapelord 10y ago
  I find it interesting that most post-Communist societies don't ever really get rid of their Communist-era massive bureaucracies. There's never any clean-up or reform, nor any real moves to weed out corruption. Its just one day the red tape goes from centrally planned projects to capitalist projects. Often, the real red tape cutting means a culture bribes and other favors towards government officials. Russia is a pretty good example of how high-corruption and bloaty bureaucracy remains post-Communism. Businesses there just consider bribes part of their budget.
  - NhanH 10y ago
    Has any country, ex-Communist or otherwise, ever been able to clean up/ tone down their bureaucracies, except the case of a total collapse?
    - oli5679 10y ago
      East-Germany arguably doesn't count because of the impact of the reintegration with West-Germany. Excluding this, Estonia has the highest rank in the 'Doing Business' Index of a former Communist state, and Czech Republic has highest GDP/capita. Both are significantly less bureaucratic than USSR days... https://en.wikipedia.org/wiki/List_of_countries_by_GDP_%28PPP%29_per_capita https://en.wikipedia.org/wiki/List_of_countries_by_GDP_%28PP... http://www.doingbusiness.org/rankings http://www.doingbusiness.org/rankings

cageface 10y ago

I've spent the last six years in Vietnam and the progress the country has made in that time is evident everywhere. There's been a lot of reckless development and many people have been left behind but there's no doubt there's also a growing middle and upper class. Corruption is endemic and is certainly one of the reasons Vietnam is no South Korea but it's also not the worst-run country in the region. You know things are changing when more and more American Vietnamese are coming back to start businesses here.

cheriot 10y ago
The original Asian Tigers included Thailand, Malaysia, and the Philippines when they boomed in the 90s. After the '98 crises, though, none of them were able to get back on track. There's good and bad ways to feed a boom in the short term. I hope Vietnam figures it out. I was there for a month earlier this year and it's a fantastic place.
- cageface 10y ago
  Vietnam has its ups and downs like every country but I can't think of anywhere else I'd rather live right now. Every day feels like an adventure.
  - cylinder 10y ago
    Which city?
    - cageface 10y ago
      For most of that time I was in Nha Trang but moved to Da Nang earlier this year.
- simonebrunozzi 10y ago
  Singapore was an Asian Tiger, too - and it did very well. You should have included it in your list.

jstanley 10y ago

> The handful of countries than have industrialized in the 20th century (Japan, Taiwan, South Korea) have taken similar paths that are very different than the policies suggested by the IMF and the World Bank. Can you elaborate on this? I know nothing about either their policies or the IMF+World Bank's policies. What are they and how do they differ?

cheriot 10y ago
Developing countries are influenced by rich countries along the lines of https://en.wikipedia.org/wiki/Washington_Consensus https://en.wikipedia.org/wiki/Washington_Consensus. To poorly summarize the book, the path that works is 1. Land reform to give small plots to families. This boosts yield and turns unskilled labor into foreign currency. 2. Protectionist policies balanced by government requirements to export so companies have to innovate instead of milking the local market. 3. Financial controls to prevent capital flight and make capital available to strategic industries. Often at the expense of savers. I highly recommend this book to anyone interested in History, Economics, or Current Events.
- Nokinside 10y ago
  This is exactly how Finland became developed country. 1. Land reform 1918. 2. Protectionist policies, import restrictions and increasing exports trough war reparations after WWII. 3. Strict financial controls and industrial policies. Finland ended financial controls in 80's. (Most Nordic countries ended their financial regulations in the 80's).
  - ptaipale 10y ago
    The interesting point in Finnish case is that the land reform was (at least nominally) a central requirement of the Red faction in the development leading to civil war in spring 1918. The White faction won the war, and it ended in a bloodbath. with the Reds severely repressed. But the law about land reform was approved two months after the civil war ended. Twenty years later, when Soviet Union attacked the country as Stalin believed the Reds still wanted a retribution, he faced a unified nation where the sons of Reds and Whites alike fought together, well enough to avoid occupation at the end of WWII, though the reparation payments were heavy indeed. And then, at present day, many people say that "the land reform was the biggest mistake of the century" because it created lots of small farms instead of big, centralized agriculture. Anyway, giving people a patch of their own land seems to be a good way to commit them to defend and work for it.

bobcostas55 10y ago

This is a very bad post hoc ergo propter hoc argument. There's no reason to believe that going against IMF advice helped. Many, many nations that did NOT industrialize also went against IMF advice. You need to show a direct connection between the two. Which you can't.

nabla9 10y ago
Arguments and data are in the book.