History Looks Different in Southeast Asia

American social scientists have paid selective attention to the history of the world. Some nations got a lot of attention. Others were relatively ignored. Generally, our social scientists are quite knowledgeable about U.S. history. Canada not so much. In the nineteenth and early twentieth century, they fancied themselves as having a lineage that ran from Ancient Greece to Rome to Britain to themselves. Their familiarity with classical history was good, their knowledge of Britain was excellent, and their familiarity with Western Europe was not bad. They were weaker on Scandinavia and the Low Countries than on France. The rise of Marxist thinking in the 1970’s brought healthy new attention to Latin America. The most exciting leftists of the period were dependistas, experts on Latin American underdevelopment. So leftist Americans learned a lot of useful Latin American economic history. East Asia’s ability to compete with America for manufacturing jobs led to some attention being paid to Japan, Korea and China.

    

Southeast Asia was generally ignored.

    

Social scientific thinking was based exclusively on the American and Western European experience before 1970. After 1970, Latin American and Northeast Asian experience was added to the mix. A large number of grand socio-politico-economic regularities were posited. These crash and burn in Southeast Asia. They particularly have trouble with Thailand and Singapore. These places were profoundly different from the experience of the United States, Western Europe, Latin America or Northeast Asia. Laws formulated on that narrow case base have to be completely rethought with a larger case base.

 

1. The Arrival of Western Colonialists Meant the Arrival of Imperialism. Local Economies Became Subject To Foreign Powers That Stifled Their Growth and Siphoned Off Their Wealth.

 

This argument is not common in mainstream economics. It is however, standard wisdom in sociology and in Marxist social science generically. Underdevelopment theory argues that Western colonialists took over the societies of the Global South, destroyed their own intrinsic capacity for economic growth and funneled resources back to Europe or later the United States. In Latin America, Eastern Europe, Africa, China, and India this is precisely what happened. Westerners created mines and plantations that were owned and controlled by themselves and not locals. They discouraged or shut down local manufacture. They created or expanded slavery or other forms of coerced labor.

Thailand looks different. The West had the same predatory ambitions it had in the rest of the world. In Vietnam and Java, the traditional story played out as expected with rice plantations and sugar plantations respectively. Thailand was already under the economic domination of China. The English showing up was an opportunity for the Thai king to do some balancing and play both sides off against the other. Even before the Chinese, the King maintained in Bangkok a collection of traders from all over the world: Persians, Indians, Arabs, Dutch, and French as well as Chinese. Independence was maintained by dividing concessions among rival groups. The Chinese had become increasingly dominant in the nineteenth century as the primary market for Thailand’s forest exports – and as the dominant mercantile class in Bangkok. The British arrival was a key facilitator of Thailand maintaining its autonomy.

2. The Secret of Successful Autonomous State-Led National Development Is Reducing Exposure to Foreign Capital.

 

This observation is based on the experience of Japan, South Korea and China. The successful performance of East Asia relative to Latin America has been the closing of their economies to foreign capital. Japan sealed itself off from the world between 1633 to 1853. China in the late twentieth century was Communist. South Korea during its growth spurt under President Park severely restricted foreign investment. What were the results? Japanese companies were owned by Japanese. Korean companies were owned by Koreans. Chinese companies were owned by China. Companies in most of the rest of the world were owned by foreigners. Multinational corporations in the other nations drained their hosts of money. Profits were repatriated to the United States or Europe; the benefits of economic growth were not reinvested in the source country. Reinvestment rates were greater in Japan, Korea and China, leading to high rates of economic growth.

 

None of which helps to explain Singapore at all. Singapore is one of the wealthiest nations in Asia and one of the most stunning examples of successful economic growth. Singapore has one of the most open capital markets in the world. There have been no restrictions on the movement of money in or out of Singapore since 1978. Foreign direct investment and foreign ownership of corporations is welcome. How much has it hurt Singapore? Zero. If anything, openness has been one of the secrets of Singapore’s success.

 

3. As Nations Industrialize, the Labor Force and the Union Movement Move from Being Weak to Being Strong.

 

The standard wisdom is based on the American and European experience. In early industrialization, the demand for labor was very weak. Jobs were few and far between. The only workers strong enough to organize in their own behalf were skilled workers. Renaissance cities had their guilds of goldsmiths, musicians, plaster workers, shoemakers or printers. In America, skilled workers were in craft unions such as those in the American Federation of Labor. Everyone else was too poor to organize. There was a nearly unlimited supply of unskilled labor. The ability to easily replace anyone meant that most workers had no bargaining power.

Industrialization and economic growth meant the number of jobs increased. Workers became more and more in demand. The supply of replacement workers decreased because so many potential workers had already been taken by other employers. Unionization became viable. Workers did organize and union members obtained real gains.

Now welcome to Southeast Asia, where workers were completely strong industrialization, and got progressively weaker as development occurred. What was the secret of worker strength in traditional Southeast Asia? Labor scarcity. Population density was fairly low. Most of the land was heavily forested. Villages were few, widely scattered and small. There were not a whole lot of people available for working in the cities.

There were two other considerations that built urban workers’ power to unusually high levels. The first is that there were frequent forced labor obligations that kept workers on the land. In Thailand, although arrangements varied, it was not uncommon for every able bodied man to be required to put in six months of time working the land of the nobility. With that kind of forced obligation, few workers were travelling.

The second, which worked in the opposite manner, is that there were vast amounts of sparsely settled forest into which peasants could flee. Because Southeast Asia is generally a tropical paradise, one can sustain oneself relatively easily in a forest hut without having to work too hard. So workers who did not want to do corvée labor, or who were unhappy with their local landlord or who simply wanted to do something new and enjoy a good life, would have had a much easier time disappearing into the forest than they would have going to Bangkok or Malacca to look for work.

Urban interests who wanted to get work done, such as building palaces or unloading ships, had to import labor from other more populous countries. Chinese workers were by far the most common. The Chinese knew they were scarce. They knew their employers needed them. They were demanding.

Labor has become significantly weaker as GDP has increased. Strikes can and do occur in Thailand. They are much rarer in Singapore and Malaysia, countries which have excellent rates of economic growth. Two factors made labor scarce in the nineteenth century – feudal obligations on rural workers and the presence of a vast open frontier with ample supplies of land. Both of these have disappeared. So workers are free to move – and if they are going to move, they will move to cities. Rural outmigration has been increased by the mechanization of agriculture and by the consolidation of large estates by urban investors. The land grabs have pushed many rural residents off the land.

So now cities are being flooded with unemployed poor people who are willing to take any job they can get. (In Singapore, the city is filled rather than flooded. Singapore controls in-migration and only allows in the number of foreign workers they need.) Regardless of whether the supply of new workers is regulated or unregulated – that supply is still ample. Workers have to compete with each other for work. Their bargaining strength is reduced.

4. The Displacement of Aboriginal People Was the Result of European Settlement and Expansion Into Colonial Interiors.

    

The American experience is Europeans coming to settle on the eastern coasts of North America, deciding they needed more land, moving west to seize land and then having their descendants move west yet again to seize even more land. First Nations people were completely displaced as people of European extraction ended up settling everything between the Atlantic and the Pacific. What happened in the U.S. and Canada also happened in Australia and New Zealand. In Central and South America, Spanish and Portuguese speaking settlers did the same thing to their indigenous populations.

    

Thailand shows you do not need foreign colonialism to generate an inward expansion from the coast and the seizure of land from native peoples. The preindustrial Thai population was primarily settled on the coast and alongside rivers. The heavily forested nature of the countryside inhibited the development of agriculture. Movement into the highlands primarily occurred in the nineteenth and twentieth centuries. In the nineteenth century, this was motivated by a lucrative global trade in forest products such as rare woods, resins and spices. In the twentieth century, it was motivated by a global trade in plain ordinary lumber, as well as cash crop agriculture. Settlement of the frontier was strongly encouraged by the various Bangkok governments who saw the upland trade as a revenue source. It was supported by lowland farmers who wanted to escape feudal forced labor obligations.

   

These transactions put ethnic Thais into direct confrontation with upland people of differing ethnicities, such as Lao or Karen. It also created a confrontation with well funded more economically developed lowlanders versus simpler poorer smaller collectivities. When it came to the confrontation of military force with military force, all of the advantages went to the lowlanders.

   

The U.S./Australian/Central American experience replicated itself – with few participants of European descent.

*  *  *

All nations have unexpected tales to tell. One can not learn enough history.

For More Information

 

For an introduction to Thai history, I enthusiastically recommend Pasuk Phongpaichit and Chris Baker’s Thailand: Economy and Politics (2001, Oxford). This is an extraordinarily sophisticated overview. There is far more social and economic history than can be found in your typical one-book national history. The bane of one-book introductions is an excessive focus on great leaders, personalities and political plotting. Phongpaichit and Baker cut through all this to the deeper underlying structural forces that shaped the flow of Thai history.   

 

On Singapore, see W. G. Huff’s Economic Growth of Singapore. (1997, Cambridge). For something more updated and very nifty in its own way see Yvonne Guo and J.J.Woo’s edited collection Singapore and Switzerland: Secrets of Small State Success. (2016 World Scientific). Singapore and Switzerland are two of the most successful countries in the world; both have all sorts of lessons that can be taught to the rest of us.

 

On the various “standard wisdoms” referred to in the essay:

 

On the role of the West in underdeveloping the rest of the world, Elsenhans, Harmut. Development and Underdevelopment: History, Economics and Politics of North-South Relations. (1984, Sage) for a simple elegant statement of the argument. You can also try Frank, Andre Gunder.  Dependent Accumulation and Underdevelopment. (1978, Macmillan) if you want an original source.

 

On the role of closing oneself off from foreign capital, Ha-Joon Chang. Kicking Away the Ladder: Developmental Strategy in Comparative Perspective. (2003, Anthem)


On the role of economic development increasing labor strength, any basic textbook in industrial relations including Arthur Sloane and Fred Witney’s Labor Relations (2009, Prentice Hall). For an original source and a cool but difficult-to-read theory of the evolution of the union movement under economic development see Adolph Sturmthal’s 1966 essay “Economic Development and the Labour Movement” in Arthur Ross’s Industrial Relations and the Labour Movement. (Macmillan)  


The literature on Europeans, expanding frontiers and aboriginal contact tends to be balkanized into treatments of these issues in individual settings. That said a reasonable account is David Stannard, American Holocaust: Conquest of the New World (1992, Oxford)