World Bank memos

Enzo Michelangeli em at
Thu Dec 3 01:01:39 PST 1998

-----Original Message----- From: Henry C.K. Liu <hliu at> To: lbo-talk at <lbo-talk at> Date: Thursday, December 03, 1998 2:04 PM Subject: Re: World Bank memos

>Enzo, my friend, now we have one more issue to disagree on. It will
>strengthen our friendship.

Of course!

>Of course, migration toward economic opportunity is centuries old and it is
>motivated by understandable, rational human decsisons.
>By the way, as you well know, Chinese culture detests emmigrants and still

There was also an emperor who issued a decree to repatriate all the emigrés, "so that they can be put to death". Well, I have already used a Shakespearian metaphor about my perception of the relationship between HK and China, and here is another one: I wonder if Overseas Chinese represent for domestic rulers a Caliban's mirror, that they hate because it reflects back the ugly picture of their own incompetence in managing the country. Luckily, the current leadership seems to have adopted a more realistic and open attitude, blaming the mismanagement by the Qing dynasty for the decay of China since the sixteenth century, rather than treacherous emigrants in cahoots with evil Foreign Devils. Surely they must feel the need for good answers to give to their children, should they ask why Chinese people living under the colonial yoke have managed to achieve a per capita income thirty times higher than in their own country.

>But the point is, the whole rationale of globalization is that in modern
>it is more economicially efficient to bring jobs and economic opportunity
to the
>people rather than the people to jobs.
>Accordingly, jobs should be enecouraged to go inland, which as you know, is
>official Chinese policy now.
>The migration to HK and the Peal river Delta and other Specialist
>Zones is caused by complex factors, economic opportunity is only a minor
>the major being China's development policy between 1978-98. I have never
>suggested that the millions of individual migration decisions were
>but I suggest that the policies that cause them to have to make such
>individually rational decisions were not the best policies.

Henry, let's be frank here: China's development policy was to introduce elements of capitalism in the coastal areas, keeping the northwest more strictly socialist. As a result, the coastal areas boomed, just as Taiwan and Hong Kong and Singapore did decades before that, and the rest of China remained as poor as before. As Chinese workers are neither blind nor stupid, they moved south: Shenzhen's population jumped in a few years from 50,000 to more than two million people. Go to Guangzhou when there are no trade shows, and you will see the square close to the train station morphing, at dusk, into a sleeping camp for thousands of migrant workers looking for a job. (During the trade shows they are shooed away by the police, worried for the good image). They may not know it, but they are pursuing capitalism.

>Substandard working conditions and environmental abuse are not necessary
>ingrediants for attracting worker migration.
>People will also also come if the environment is pristene and the factories

Certainly, but nobody will ever invest in places with terrible infrastructure and plagued by officers asking for kickbacks, unless labour is cheap enough to guarantee high returns. And I'm not only talking of foreign investors: Chinese capital is as smart as any. Which is why it's been traditionally held offshore.

>So the tycoons in Hong Kong willl have 2 instead of 4 Rolls Royces each,
its not
>a great sacrifice for clean air and water.

HK is in a much better position than China, and the pollution is not that bad, even though more could be done. And it will, because highly paid professionals care about health more than workers who have more immediate worries (which explains why people in poor countries smoke much more than in rich countries). But it's *wealth* that is bringing in a cleaner environment, not social policy. Otherwise, Calcutta would be a garden and Carmel a dump.

>My point is that abusive business practices will end only if they are
>by law. Business will always find a way to do business if everybody is
>to the same rules. The World Bank, instead of providing sophisticated
>for pollution and inhumane labor conditions, ought to take economic and
>environmental human rights seriously and impose a global regime through
>such practices will be illegal as well as unprofitable. It is not an
>issue, rather, it is a poltical issue. To argue such a basic issue on
>effieceincy and transtional neccesity grounds is simply misleading, if not
>suspect. It reminds one of arguing for slavery on economic efficiency

You may find that disheartening, but slavery ended precisely when it wasn't economically efficient anymore (when, as Aristotle famously said, "machines will move themselves"). Morals, and laws that officialize them, don't live in a Platonic Hyperouranic world, but are strongly influenced by the economic structure. That's one Marxian lesson that I totally agree upon.


More information about the lbo-talk mailing list