On Fri, 12 Dec 1997, Martin Hart-Landsberg wrote:
> We should take confidence from the South Korean experience that there are
> effective alternatives to the free market. But we should not be surprised
> to learn that state capitalist regulation of economic activity directed
> towards profit maximization, as in South Korea, produces contradictions
> and crisis. The debate has to be opened up. We need to be calling for
> radical restructuring of the South Korean political economy, for the
> creation of new forms of worker control and democratic social regulation
> of economic activity as part of a transition process which must include
> making the South Korean economy less export dependent, more domestically
> centered, etc. Reunification is a part of this.
Let's not forget the important and significant precedent of the European
Community and European Union here. Calls for new forms of worker control
are cool, but what this means in practice is creating a genuine welfare
state within Korea, as well as forcing rich countries like Japan to pay
subsidies and EU-style structural funds to assist the development of the
East Asian periphery. The Korea strategy worked for as long as there were
rich American consumers able to buy all those exports; today, effective
demand is being throttled everywhere, ergo the export model is in crisis.
The EU has avoided a lot of these problems by its generally social
democratic orientation towards investment (which emphasizes wages and
education and prevents really severe property and finance bubbles from
happening in the first place), by debt write-offs to
Eastern Europe, and by Central European subsidies to Spain, Italy, Ireland
and the like (you will note that the exchange rate crisis in Europe in
1993 was limited and relatively moderate, compared to the truly
epic Asian meltdown).
Most of all, Japan Inc. needs to get off its ass and start funding its
semi-peripheries, just like America started to do in 1950 vis-a-vis
Western Europe and Japan, via military Keynesianism. They have enough
money to erase the bad debts of their banks and get the economy going
again, it's just a question of political will. How about keiretsu
Keynesianism for the new millenium?
-- Dennis
