Rajpal's Column

25th October 998

Bringing up the country — the new model

By Rajpal Abeynayake

Confucian economics '' is suffering a setback in the part of the world where it became part of contemporary politics. Many Asian economies are reeling, even though that does not include Sri Lanka. You should have seen President Chandrika Bandaranaike Kumaranatunga saying on CNN that "strict financial discipline'' and "floating the rupee'' has saved Sri Lanka from the financial crisis that is now seen in many parts of Asia. ( She seemed regal on screen, and didn't stop talking until the CNN anchor politely cut her off for "constraints of time.'') Of all the Asian economies that have suffered a downturn recently, most prominent are those that were fond of citing "Confucian authoritarianism'' as a recipe for economic development and growth. Mahatir and Suharto saw emancipation with a measure of state authoritarianism and state control. Excessive trade unionism, for instance was seen by the new Confucians as a luxury that cannot be afforded by new emerging economies.

Then, the Asian miracles disappeared into thin air, Suharto resigned, and left the likes of Mahatir in all kinds of trouble. Now comes Nobel prize winning economist Amartya Sen of Bengal, India, who drives the final nail into the coffin. Says Sen that " leaders of East Asian economies have been guilty of quoting Confucianism selectively to justify their own authoritarian excesses.''

Therefore, Sen's coming in from the cold is a happy coincidence for him. Here he is , coming from India, which never coveted the ideal of Western civilisation anyway . ( At least not officially. Remember Mahatma Gandhi who famously said he thought Western civilisation would be a "very good idea.'' Yet, Sen comes at the time when the East Asian brand of capitalism is down and out, and Mahatir is in the doghouse, proclaiming that "democracy and media freedom is the greatest economic weapon against famine and deprivation.'' One needs a double take when it is announced that Sen has won the Nobel prize for economics, because it appears that his agenda would have more to do with the Nobel for peace. But the Indian's concerns are for the economics of famine, not for the economics of the stock market.

Whereas the Lee Kuwan Yews of the world say that press freedom is not wanted when an economy is growing, Sen says the opposite . He claims that most of the remembered famines of the world, including the one in Bengal during British rule was due to lack of democracy and freedom of expression. But, most of all, at this juncture of time in Asian politics, Sen underlines how quickly the authoritarian theories of West Asian capitalism have crumbled. Sen's Nobel is being awarded almost over the graves of Mahatir Suharto and the lot.

What does all of this finally mean? That ideologically, Western ideas of capitalism have finally triumphed and have forever vanquished the sceptre of "Confucian capitalism'', which preached the work ethic and ( at least obliquely ) the curtailment of personal freedom?

There are nagging concerns yet that stem from Sen's humanitarian economic theories. India's is the largest functioning democracy of them all, but yet, the Indian economy faltered at the time the Mahatirs and Suhartos were being canonised as the Confucian capitalist champions. How so?

Anyway, now that the tables have turned, will it mean that the economic lessons articulated by Sen will spread in the capitalist economies of Asia which are still struggling to climb out of trouble? In other words, will democracy have to be that spade that will help dig Asia out of the economic mudslide?

Very few analysts would have the answer to that, but what's striking is that there is an almost eerie way in which things have evolved. Though it is not to say that it is a Western aided conspiracy, it is almost curious that a Nobel prize winning economist says that authoritarianism in government is not good economics. He says this just after the darlings of Confucian capitalism, Mahatir etc., et,. at have gone out of favour dramatically.

Effectively it means that, for all intents and purposes, the East Asian example of economics is out — that it is the end of history for the Asian system which was ballyhooed and copied, even by Sri Lanka, just a couple of years back.

The UNP, the most ardent capitalist party of this country by far even by today's reckoning, was keenly following the Asian Tiger model of economic development, coupled with a good dose of authoritarianism. J. R Jayewardene would swear in his heyday by this type of government.

Now, things have changed, and the trend is towards democratising government as a good economic practice! If that is so, the incumbent government should be democratising as if its life depended on it, because democracy and a good economy, if they can be established together, would be like the ultimate blessing for any government which wants to stay in power.

Yet, we do not see this government democratising so rapidly, especially in the area of press freedom with censorship imposed on military news, for instance. After all, the new czar of the economic doctrine, Sen, has emphasised the free press.

But, if the government is not inclined to democratise rapidly, may be the government can argue that following the trend of the times is not the best way to go at any given moment. The UNP followed the trend which was raging at that time, which was to follow the Confucian capitalist model of the Asian tigers. That came a cropper. Now the experts say, democratic capitalism is the best way to go. Perhaps the best lesson in this for all governments, especially of developing Asian economies, is to agree that there is merit in the middle path; that there is no democratic panacea or authoritarian paradise. Utopia lies somewhere in the middle of democracy and authoritarianism, which of course anybody in this government would agree with, especially when they cannot seem to keep up with all the grand election promises to democratise.

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