4/2/2010
theoretical parameters
of vivek's book are a bit askew from what we've been looking in, in
this course.
two enduring
forms of the State
welfare State
developmental
State
wanted to show that the
developmental State could be understood in the same frame as the
developmental State. it used to be thought of as a 'third-world
State'. and when the 'developmental State' came around as a
theoretical category, it was understood a-theoretically. vivek
looking at it as a 'capitalist State'.
the terms of this
debate, though, were different.
the key concept
that was developed came from the debate about the Welfare State,
which was 'state capacity' – when Marxists say that the welfare
State functions to perpetuate capitalism, they assume both a
willingness and a capacity to administer to capitalist interests.
this cannot be taken for granted; it has to be built.
because it has to be
built, facts about the State itself are going to have a large bearing
on whether and how State capacity is built. in the developmental
State literature, this had a large impact. it came out of the context
of neoliberalism, where the argument was that State's will
necessarily muck it up (rent-seeking, or crowd out, or whatever). in
every case, the State will harm development. this came out of Latin
American stagnation—they squelched private intiative.
BUT: by the late
80's/early 90's you had a growth miracle in E. Asia. and you had
extensive State intervention. what the developmental State literature
argued was that what distinguished these States was 'State
capacity'--they had the capacity to intervene successfully. the
question was not State intervention, but the quality of State
intervention.
the question that was
not asked, however, is how State capacity gets built. the argument,
when it was made, was as simple as, well, politicans built it (Peter
Evans' book is a partial answer—you need good bureaucracy and good
ties to the private sector. But even here the answer is not given as
to the origins).
in vivek's book, there
were two cases: India and Korea. in the former, it was a failure; in
the latter, a success. difference was capacity. why?
easy answer: gift of
long historical process. determined at the outset, in a sense.
but neither country had
much of a developmental apparatus, when it started out. that means
that there was a punctuated period of State building. in Korea, this
was successful. in India, not.
the answer that vivek
gives is that it has to do with the reaction of the capitalist class
to State-building. this was novel because it was assumed, prior to
this, that capitalists don't matter, because these were poor
countries. but in fact, vivek shows that the opposite was true.
what it shows, then, is
that the developmental State was constrained by bourgeois power
because the caiptalist class was able to forestall State-building.
the attempt, then, was to bring
why did the Indian
capitalist class rebel?
- - - - - - -
remember, the two
theoretical arguments re: the State
instrumentalist
accounts
structuralist
account, the most important of which has to do with 'business
confidence'
theda skocpol offers an
account of 'full autonomy' – that the State can ride roughshod over
the capitalists, if it will.
in dev. state
literature, the notion of State-centeredness was at its height in the
late 1980's, mid-1990's. it was a counter to the neoliberal arguments
that had been dominant, at this time, after the Latin American
collapse in the 1980's (those countries where States had intervened,
in the past). the only way, it was said, to accelerate the pace of
Capitalist development was for it to become a 'nightwatchman State'.
Amsden and Wade upset
this apple-cart. it was not the fact of State intervention that
determines the outcome, but rather the quality.
well, what conduces
high-quality State-intervention? the answer that emerged was: States
with adequate capacity. if the State has this ability, then, it can
overcome the obstacles people pointed to (obstacles were rent-seeking
on the part of private agents, and State predation).
KEY--one
argument could have been about the 'social setting'--a kind of
Marxist account, about the history of the two countries, etc. in Left
literature, there had been this notion that in the Third World,
classes are underdeveloped (Hamza Alavi). the idea, here, being that
States are much more powerful, viz-a-viz social classes. the only
actor that was seen as being capable of upsetting the State's agenda
was the landed class. this literature in Latin America, and
elsewhere, always points to the absence of land reform. as an
economic fact, certainly, but as a political fact (the power of
landlords). this, however, was an inference; it wasn't an argument.
nowhere was the industrial bourgeoisie seen as being capable of
blocking the State's agenda. [a subsidiary argument was that, even if
industrialists do matter, why would they care? it's going to be a
State, for them—capitalists were thought to be natural allies of
the developmental State.]
a very powerful
argument at the time was that Korea succeeded, at the time, because
it was an authoritarian State. vivek's argument is that the opposite
was the case, in fact (to be developed, later) – in an
authoritarian state, a class that you should find that is unable to
impose its will on the political process, in fact, is labor, not
capital. it's true, maybe, that your control over labor might make
capitalists more amenable to a partnership. four countries: taiwan,
korea, france (45-68), japan (54-mid 1980's)--'successful capitalist
planning'. the latter two were democratic states].
the argument in the
Korean State is that, even when the State controls finance, it is
subservient to capital. example being given is the switch to heavy
industry in Korea in 1973. control of finance is only a weapon when
capitalists have a high demand for finance, which presupposes
'business confidence'.
[if military takes on
capital, workers may lose jobs. if workers take on capital, capital
loses its power of the 'investment strike,' because work is already
stopped]. think through this.
in both India and
China, Nehru and Park have political hegemony. Nehru could have
pursued his agenda, but political elite pointed to the go-slow. In
Park the political rivals didn't have the support of the capitalist
class. this is key, clarifies the impotency of a 'within-state'
argument.
the question of land
reform—if the book had been about growth, then land reform would
have had to be in the book. what vivek is looking at is one part of
what explains growth, which is State capacity. [key--absence
of land reform increases the incentives for capitalists to ignore
plan directives. planning, remember, is premised on the notion that
capitalists pursue industries that have high private returns but low
social returns (luxury good sectors, niche sectors, etc.). highly
unequal income distributions, which follow from failed land reform,
give rise to these kinds of sectors. so land reform does matter, in
this sense.]
[thinking about brazil,
chile, etc., and the transition of the 1920's/1930's/1940's] what
about the landed class? it wipes out the dominant, landlord class.
the immediate reason is because the evidence didn't show any landlord
influence (found one petition from landlords). all of the two-dozen
business organizations expressed their opposition to this
legislation. what that said was that they're just not a factor. why?
what about latin america, and the supposition that landlords didn't
like developmental state (remember, this is not about economic
growth)? the commitment to build developmental states is really a
phenomenon of the post-1930s; the commitment to industrialization
starts in the Great Depression, mostly as a necessity (because third
world countries are cut off from their markets). when you compare the
two threats, is it not the switch to rapid industrialization, rather
than the switch to the developmental state that threatens them?
industrialization, remember, threatens to wipe out the landed class.
the supposition is that industrialization rendered them politically
helpless—how do you get the onset of developmental
states/industrialization without land reform? the explanatory task,
here, would be to understand how the power bloc shifted in the 1930's
and the 1940's.
from 1960-1975, India
was far less corrupt than Korea. today, the most corrupt state in the
world is also the world's fastest growing economy. [cf. Mushtaq Khan]
Japanese multinationals
in Korea were using the country as an export platform; European and
American multinationals used India as a home market, blocking Indian
access to the American market.
size of the domestic
market (domestic demand) does not produce an export-led strategy
(China, DR/PR). export markets are not more attractive because
they're highly competitive (they're used as places to dispose of
excess inventory at firesale prices, sometimes).
two
counterfactuals
you use the labor
movement, as in France, to push a developmental State, then you push
them out. labor has a role in state installation, but nothing in
State reproduction.
you would have had
a social-democratic developmental State. so it's important not to
think of ISI as mal-development, ISI is a world-historical success.
but, of course, pound for pound, India could not have matched Korea.
[yes, ISI carries internal contradictions—but so does ELI. this
happens in the mid-90's in Korea, they cease to be interested in a
developmental state.]
- - - -
KEY, the
question of the 'flying geese'--what Japan did with Korea, remember,
is give them low-value niches, so that they themselves would have
room for capital good exports. Korea and Taiwan do the same thing,
later, with South East Asia (and this helps the book's
argument—Indonesia and Malaysia don't have developmental States, so
they're not nearly as successful as Korea and Taiwan).
also, let's remember
that Japan's strategy, re: Korea, is greased by the executive branch
in the US (Congress is more ambivalent).
Two
contingencies, in this book:
Opening created by
the arrival of the Japanese
Park Chung-Hee's
taking advantage of opportunities granted him by the Japanese.