The Thailand version of Asian miracle is real in terms of macroeconomic performance, the growth of manufacturing, and real changes in standards of living for an extraordinary number of Thais. But the miracle is only part of the story. Poverty, environmental degradation, urban congestion, AIDS, regional tensions and ethnic conflicts, real estate and property speculation, scams and scandals, and a military with political/economic power are also part of the Thai miracle. Bangkok is a mess. All of these problems are well recognized by all walks of life in Thailand. Surely a great case study in development and underdevelopment. One concern with the collapse of the Thai/SE Asian bubble is whether somehow it could spread over to East Asia or even this side of the Pac Rim. Probably not -- Thai/SEA imports from the industrial countries are probably too small, but maybe next time will be different. While it is true that China and Vietnam increasingly receive more Japanese investment, Thailand, Malaysia, and Indonesia will not suffer much once the collapsed bubble is digested. Japanese MNC's have carefully extended their domestic *keiretsu* networks into SEA and they cannot (or will not) extract themselves from these networks. After all, long-term markets, resources, and all the related institutions and infrastructure are in place. One must remember also that Japanese investment is in real plant and equipment, not in terms of speculative land purchases or even an aircraft carrier. (The Thai military just bought a used one). The fascinating thing about the Thai bubble collapse is how the political and economic powers will try to use the IMF resources and domestic "austerity" measures to impose the costs of speculation and underdevelopment problems on Thai workers and farmers. Will the Thai fat cats really be required to swallow the costs of the bloated bubble? Or can they push it off on someone else? Personal note/rumblings: last year I spent a week in Chachoengsao province (east of Bangkok) and stayed with my colleagues from an earlier time. It was lots of fun. The town of Chachoengsao has its own urbanization problems and even traffic jams! There was now a shopping mall with a multistory parking garage on the edge of town, and urban sprawl in lots of places. The first night we ate at a restaurant on the river and planned the week. One of my requests was to talk to farmers about their problems and concerns. They were slightly taken aback: "where are the farmers"? No longer just a short bike ride from town. Anyway after talking to rice, fish, shrimp, and mango farmers, I came to the conclusion that the Thai miracle wasn't the same as all of the nice macroeconomic performance reports coming out of Bangkok. Rice farmers in particular were bitter about low prices, angry that many of them were renting land from absentee landlords, and disgusted that the government did virtually nothing to support them. And this is in a province which monsoon rails and irrigation works make for an ideal farming setting. Some farmers, those that owned their land, did the best. The shrimp and mango farmers have their environmental problems -- and no EPA in sight. Many of the farmers' sons and daughters are drawn (propelled?) into the many factories in the Bangkok area; one fish farm was worked by Cambodians. During a previous trips, I visited one of those factories -- the Nike factory in Bangkok. A large amount of Nike's shoe production has been moved elsewhere in SE Asia. Part of the time stumbling around the countryside I was with one or two of my former colleagues. The rest of the time I was solo and used local transportation and hoofed it here-and-there and talked to farmers where-ever I could. In many ways the country-side had not changed in three decades or since my previous visit 8 years earlier. But a significant amount of the housing stock was much better (ie stucco houses instead of wood), there were more paved roads, and small mechanic tractors had replaced the water buffalo. The kids were clearly better fed, clothed, and healthier compared to my first time to Chachoengsao. One time I came across a beautiful new housing project going up -- it was about 70 km from Bangkok. It was such a contrast to the housing stock of the farmers in the immediate vicinity. In fact there was a lot of new housing (homes, apartments) be constructed and the finished ones might stay vacant for up to 2 years until they sold. That is, the development costs and prices were such that it might be two years before the bubble economy generated buyers. With the collapse of the bubble, there is a tremendous amount of housing, apartments, and shopping centers with not enuf buyers and customers. The people, as always, were very friendly and easy to engage in conversation. (All of the above is not very rigorous in terms of a research project, but good enuf to collect some observations and reflections.) The real question in Thailand is whether they can can establish a stable economy and deal with all of the problems of underdevelopment. If we have a collapse in the US maybe some will ask the same question. Barney Hope Dept of Econ, CSU Chico [EMAIL PROTECTED]
