It is certainly an interesting question to explain. There is no need to explain it away.
Mahathir had a tradition of national capital behind him and of teaching the British an economic lesson. When the Asian financial crisis threatened his ambitious plans there was a robust national capital interest in Malaysia shared by both the Malay and the Chinese community. The same current of thinking that led to Hong Kong's unprecedented defiance of the hedge fund raiders, would have been part of that shared culture.
So at least in Malaysia, the South East Asians did not behave like cowed slaves of capitalism. Some of the network of business links, which neo-liberals are keen to condemn as corruption meant there was a sophisticated economic society that could back a challenge to the IMF. They put their money where there mouth was, and invested their own money in the Kuala Lumpur stock exchange. (Similarly the Hong Kong stock exchange has remained well above its 1998 low)
Whereas what was decisive about the Russian collapse was the "oligarchs" exporting their capital out of their country, to New York.
And also by contrast in South Africa, the only tradition of national capital was the racist Afrikaner one, which was defeated by an alliance between the masses and international finance capital. The black bourgeoisie was far too small to be able to face down the international bond traders. It had fundamental conflicts with the remnants of Afriakaner national capital, whose jobs it sought in the government machinery. Meanwhile the national bourgeoisie of Indian origin had developed a self-reliant sector of the economy, and was opposed to Afrikaner capital but mistrusted the privileges for which the Africans were striving.
>It's as if a massive fight for the soul of the ANC wasn't fought by
>internal Mass Democratic Movement leftists from 1990-93... and
>lost.
Yes I know there was a massive fight for the economic soul of the ANC. I have just been rechecking the report of MERG, the Macro Economic Research Group, which had access to some of the best progressive economists in the world. But the conclusion of the section on Macroeconomic Policy, Monetary Policy and Exchange Rate Policy has no mention of the volatility of financial movements in the external world.
My understanding is that the MERG strategy was essentially a progressive "Keynesian" one in which government-led expenditure would enliven the economy from the bottom up promoting employment especially in those sectors that would most raise the living standards of ordinary (black) people. It assumed an increase in Government deficit expenditure and assumed that the economy could sustain this and some pressure on the exhange rate until the dividends of a much higher level of production came through.
I think this was implicitly predicated on a benign international financial climate for a period of say, 5 years. But the Mexico crisis in the early 90's showed how volatile the international financial markets were becoming.
Besides who could be sure that the much-hyped peace dividend with the ending of apartheid would bring the inflow of funds on the desired scale. Even as a regional economic power the prospects of South Africa are limited by the poverty of the region overall. And the level of violence has become endemic.
>(This is, if I can advertise, the subject of Elite Transition: From
>Apartheid to Neoliberalism in SA, forthcoming from Pluto in Feb;
>only two chapters are on the int'l financial markets' influence.)
Please make sure serious reviews by professional economists get posted about it. Perhaps you can get a couple of complementary copies to people who would post on LBO-talk and PEN-L. It is a very important story.
I do not present the comments here with any enthusiasm but in the interests of serious debate. You may well be able to correct me about details: the only advantage I can claim is distance, if that helps perspective.
Chris Burford
London