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Development and democracy in Asia
Tuesday, 05 July 2011 05:55

East Asia's economic development these past few decades has been stunning.  But to what extent has this economic development laid the foundations for democratization, as modernization theory would suggest?


This question is very timely in light of this past weekend's election in Thailand, Chinese President HU Jintao's major speech last week on the occasion of the 90th anniversary of the founding of the Chinese Communist Party, and even last weekend's protests in Hong Kong and the recent elections in Singapore. 


Economic development usually involves a process of industrialization, especially in East Asia where natural resources are scarce and there are large, low-skilled work forces.  This sets in train a process of "modernization" which penetrates all aspects of life -- bringing occupational specialization, urbanization, rising education levels, and higher life expectancy and standards of living. 


According to Ronald Inglehart and Christian Welzel, this creates a self-reinforcing process that transforms social life and political institutions, bringing rising mass participation in politics and in the long run making the establishment of democratic political institutions increasingly likely.  Junling Hu has estimated that a non-democratic country will always move toward more freedom after its annual income per capita reaches $5000.  He has also argued that a prosperous economy may create demand for more protection of property rights and rule of law.


 Inglehart and Welzel cite the cases of the rapid economic development and subsequent democratization of South Korea and Taiwan.  These countries produced exports for world markets, which drove economic growth.  They invested the returns in human capital and upgraded their work forces who could then produce high-tech goods bringing higher returns.  Ultimately, this enlarged the educated middle class.  In short, economic development is conducive to democracy to the extent that it, first, creates a large, educated, and articulate middle class of people who are accustomed to thinking for themselves and, second, transforms people's values and motivations. 


As nice as this story sounds, some would raise alternative arguments.  It has been suggested that the Taiwanese regime decided to hold democratic elections because it needed to mobilize the support of democratic countries in its geopolitical struggle with China, a reason that has nothing to do with income.  It also seems clear that considerations of international respectability may also have partly motivated Korea’s transition to democracy.


So what is the state of democracy in Asia?  According to the Democracy Index 2010 of the Economist Intelligence Unit (EIU), there are only two full democracies in Asia, being Korea which ranks 20th on its global scale of 167 countries, and Japan which ranks 22nd.  North Korea brings up the rear at 167th.


Beyond 26 full democracies globally, the EIU has a large group of over 50 “flawed democracies” which includes Taiwan (ranked 36th worldwide), India (40th), Thailand (57th), Indonesia (60th), Malaysia (71st) and the Philippines (74th).  Then we come to the so-called "hybrid regimes" like Hong Kong (80th), and Singapore (82nd).  The bottom category is that of "authoritarian regimes" which includes China at 136th and Vietnam at 140th.


The analysis of Inglehart and Welzel seems however rather simplistic when one looks at developments in Thailand and other countries over the past decade.  Yesterday, Yingluck Shinawatra of the Pheu Thai party was elected Prime Minister of Thailand, overthrowing the Democrat Party which represents the interests of the monarchy and the urban and military elite.  The Pheu Thai Party pledged to raise the minimum wage, provide development funds to rural villages, create a high-speed rail network and give every school child in the country a tablet computer.


Yingluck Shinawatra is the sister of Thaksin Shinawatra who was Prime Minister of Thailand from 2001 to 2006, when he was deposed in a military coup for allegedly abusing his power for personal gain.  He is a very wealthy businessman who was also a champion of the poor people.  He introduced a range of policies which helped reduce poverty by half in four years, and launched the country's first universal healthcare program as well as a highly popular drug suppression campaign, but which involved severe human rights violations.    


However, his government also faced allegations of corruption, authoritarianism, treason, conflicts of interest, acting non-diplomatically, and muzzling of the press.  Thaksin was accused of tax evasion, lèse majesté (insulting the dignity of a reigning sovereign) and selling national assets to international investors.  Protests by the People's Alliance for Democracy occurred in 2006, and on 19 September 2006 a military junta which later called itself the Council for National Security overthrew Thaksin's government in a coup while he was abroad.  Thailand has since been plagued by internal division and violence.


Much can be said about Thaksin, his behavior and policies.  But Thai politics over the past decade, and the robust democratic election last weekend, represent a struggle between the urban elite winners of development and the poorer rural populations who have been excluded.  It is this which is driving democratic politics, not a large, educated, and articulate middle class which is demanding democracy.  The outgoing government and the military (the traditional guarantor of Thai political stability) has promised to respect the election results which gives hope for democracy.  But the situation is fragile, and when and if Thaksin returns from his exile in Dubai, there is certain to be more unrest.   


The situation in China shares many similarities with Thailand.  Since Deng Xiaoping opened China in 1978, we have seen average growth rates of 10%, massive reductions in poverty and dramatic growth in prosperity.  This economic growth has been very uneven with coastal regions benefiting very much more than the hinterland, and industry more than agriculture.  A key feature has been massive corruption and ostentatious wealth of leading Communist Party members, while hundreds of millions of peasants still live in poverty or near-poverty.  China is rife with protests and demonstrations provoked by corruption and other injustices.


Clearly Chinese President HU Jintao is very worried, as evidenced in his speech just last week:


"... we must follow the principle of fighting corruption in a comprehensive way, addressing both its symptoms and root causes ... cracking hard on and effectively preventing corruption is crucial in gaining popular support for the Party and ensuring its very survival ... The Party is soberly aware of the gravity and danger of corruption that have emerged under the conditions of the Party being long in power ... If not effectively curbed, corruption will cost the Party the trust and support of the people."


But Hu Jintao is also clearly worried about the capacity of the Communist Party to deal with corruption, particularly at lower levels of government: 


"... The Party must demonstrate greater confidence and resolve and take more forceful measures to improve the institutions for punishing and preventing corruption and unswervingly fight corruption ... Officials at all levels must have a keen sense of living up to the people's trust, guarding against wrong doing, and holding themselves to higher standards. We must act in the true Party spirit, ensure integrity, and play an exemplary role in society..."


When Deng Xiaoping opened up China, he unleashed a monster.  And while Inglehart and Welzel argue that beneath China's seemingly monolithic political structure, the social infrastructure of democratization is emerging, it may not be as simple as that.  China's articulate and educated middle classes may have more of a vested interest in stability and a continuation of the status quo, rather than democracy which could unleash the frustrations of hundreds of millions of poor people, who are already mad and angry at the corruption and excesses of the Communist Party.  It is difficult to imagine a peaceful transition to democracy in China.  But as we have seen in the Middle East and North Africa, movements can get going quickly, and Facebook and new forms of social media can certainly add fuel to the fire.


As to Singapore and Hong Kong, these city-states are among the world's very richest economies, and their citizens should be happy.  But much like everywhere these days, there is a yawning gap between rich and poor.  The ruling Singaporean People's Action Party, which produced the world's true economic miracle, lost a large share of the popular vote due to concerns about rising immigration, inflation and a widening income gap.  This is an amazing result in Singapore where elections are very controlled and opposition personalities are threatened.  In Hong Kong, protests have been driven by high housing prices and a government proposal to scrap by-elections to the legislature and fill the seats according to earlier results.


In summary, it is difficult to contest the notion that there is a broad relationship between development and democracy.  The world’s richest nations are virtually all democracies – countries like the Nordics, Australia, Canada, US and Japan.  By the same token, the five least democratic countries on the EIU scale are poor countries, namely, North Korea, Chad, Turkmenistan, Uzbekistan and Myanmar.  But the process by which economic development creates the conditions for democracy seem very complex.


There may well be cases where political and social modernization is a natural outcome of economic development.  But there also seem to be cases where economic development creates injustices, tensions, violence and conflict.  While the ultimate destination may be more democracy, it is likely to be a rocky road. 


In reality, history shows that perhaps the great driver of democracy is the failure of non-democratic regimes -- like facism in Europe in the first half of the 20th century, communism in Central and Eastern Europe, and corrupt dictatorships in the Middle East and North Africa today.  And in the former two cases, democracy has proven to be a positive, though imperfect, force for development.  



Inglehart, Ronald and Christian Welzel, How Development Leads to Democracy: What We Know About Modernization.

Foreign Affairs. March/April 2009


Economist Intelligence Unit. Democracy index 2010. Democracy in retreat.


Hu, Junling.  The Causal Relationship between Democracy and Prosperity




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