PRAXIS

Transformations and Narratives

Neoliberalism, Bureaucracy, and Civil Society: Development Dilemmas in Thailand and Argentina

[Intro]

"The development of world powers, a characteristic feature of our times growing in importance along with the progress of capitalism, from the very outset condemns all small nations to political impotence. Apart from a few of the most powerful nations, the leaders in capitalist development, which possess the spiritual and material resources necessary to maintain their political and economic independence, “self-determination”, the independent existence of smaller and petty nations, is an illusion, and will become even more so." (Ishay 1997, 294)
Rosa Luxemburg 1909
From The National Question and Autonomy

"Bureaucracy—in other words, the permanent prevention of any direct exercise of power (self-administration) by the mass of the working-class. This structure could at best constitute an indirect democracy—rule by the people’s representatives rather than rule by the people themselves; but in fact this is purely formal in character because of the economic impotence of the majority of wage earners to acquire the material means for the actual exercise of their democratic liberties." (Mandel 1978, 496-97)
Ernest Mandel
From Late Capitalism

Any case study on a particular or group of countries requires an inquiry into the making, or creation, of its current conditions. With respect to Thailand and Argentina, the two countries with which this paper is primarily concerned, a particular blueprint or accepted paradigm of development is largely responsible for the current economic hardships of these two developing countries. While there are remarkable differences, by which we could also conclude that all countries deemed ‘Third World’ are separated by distinct circumstances specific to their own separate histories, there are striking similarities which shed light upon the nature of development, modernization, globalization, and other buzzwords of the current era. The particular aim of this paper is to underscore the background leading into such concepts, or more relevant terms, and comment upon the utility of particular movements in Argentina and Thailand which have historically, and concurrently, responded to them. This paper concludes that out of the failures of internal bureaucracies and external neoliberalism emerging social movements within civil society represent a pre-figurative, and/or post-Western, politics for the future of the Third World.

[Democratic Versus Economic Transitions]

The Third World, unlike the industrialized West, has always remained vulnerable so long as they have functioned subserviently and co-dependent (e.g., relying on outside assistance and a tight internal bureaucracy) in the establishment of their foundational base—which we will here refer to as “the institutions of quasi-democratic transition”. Democracy is foundational in that it dictates its own objectives according to popular involvement and consensus. A primary component of this paper explores the nature of democratic transition in Thailand and Argentina specifically within the context of globalization, and concludes that popular consensus—as well as popular discontent—can no longer be ignored.

The scope of analysis required for delving into the vast dynamic of change in the Third World can be charted along socio-political, economic, and cultural dimensions. Though to be fair and democratic, such a scope need put further emphasis on what can be done from within a developing country than from external coercion—all too commonplace in the policies of the International Monetary Fund (IMF), et al. Workers collectives in Argentina provide evidence that the base-level of society can provide the impetus toward democratic transitioning. Democratic change, however, is not universally achieved in the Third World, though similar patterns often emerge. Both Argentina and Thailand, for instance, have benefited from organizational assistance from existing local level Non-governmental organizations (NGO’s) and other working class grassroots movements.

Economically, the Third World have boosted profits and expanded private enterprise within a time frame unprecedented which furthers the figurative misconception that the citizens who live within their boundaries are benefiting. In truth, the lives of Third World inhabitants have undergone radical cultural transformations, without regard to quality of life issues, to the extent that conventional economic analysis must be called into question. Who are the winners and losers of development? Can current modes of development be explained through an economic lens, and what constitutes development: macro changes on the global level or micro level social movements weaved into an existing cultural reality? Thailand and Argentina provide useful social and political dynamics worth evaluating to arrive at reasonable answers to the aforementioned questions.

Various models and theories, such as modernization and structural adjustment, and the dependencia school of Marxist analysis, have been put forth and applied as feasible models of assessing democratic transition from traditional to industrial economies. Though, the latter made a concerted effort to locate the losers of development, this type of structural analysis in the field of political development, in fact, found their roots in pre-existing economic models that had been refurbished and given new names by the politics of ego. Attention to earlier analyses should have rendered the development ideas of Walt Rostow (the staunch anti-communist, National Security Adviser under President Johnson, and author of The Stages of Economic Growth), Samuel Huntington, and other Anglo-centric architects of political development into the dustbins of neo-colonialism. Instead, the dustbins of history remain far from view.

In the 1930’s, for example, economists RF Harrod and Ed Domar (Harrod-Domar Model of Economic Development) believed that the key to economic development was the expansion of investment in terms of fixed capital and human capital. In theory, policies would be needed that encourage saving and/or generate technological advances which enable firms to produce more output with less capital, i.e., lower their capital output ratio. Critics of the day voiced likely weaknesses of this model. On one hand they contended it would be difficult to stimulate the level of domestic savings particularly in the case of Less Developed Countries (LDCs) where incomes are low. On the other hand, borrowing from overseas to fill the gap caused by insufficient savings would cause debt repayment problems later.

Another pre-Huntington/Rostow theory was put forth in the Lewis Dual Sector mode of development. As the agricultural sector waned due to the onslaught of urban development with its focus on building a competitive industrial capacity, there arose a need for finding an economically feasible solution toward a more financially productive agricultural sector. For Lewis, the harmonious key to development could be achieved in striking a balance between agricultural and industrial productivity. The ultimate end in mind, in line with the 50’s mentality of course, was to generate savings which could then be reinvested into the economy thereby promoting growth. Lewis forwarded the idea that since industrial productivity was lucrative and economically beneficial, and since their existed a declining role within the agricultural sector, more rural inhabitants could leave the peripheral outskirts and work in the more financially-lucrative cities. This would free up more resources for fewer inhabitants in the rural outskirts, whereby the agricultural sector might increase productivity for fewer people. Furthermore, those who moved to the urban areas would generate savings to establish a higher income, and hence generative increased savings. The weaknesses of this model were voiced then and are well-known to Third World inhabitants today. First of all, increasing technology in the industrial sector weakens the demand for increased labor in urban areas. Additionally, urban migration often provides more workers than the industrial sector can provide jobs for. Furthermore, the cities were slow to provide an infrastructure to capacitate the sheer influx of rural inhabitants to the city.

The purpose in mentioning both the Harrod-Domar Model and the Lewis Dual Sector mode of development is two-fold. First, theorists of political development were ignoring valuable economic critiques to contending modes of development. In a sense, the political development canon was motivated more by the theoretical preceding actual practice, while economists were more prone to observe particular transitional trends prerequisite to the institution of development modes. If the purpose of economic models preceding the 60’s political development canon focused on savings and re-investment, the political motivations instituted in the Third World totally ignored them. This blatant disregard still lingers today while the power-wielding dominance of international banks and Western influence continues to place priority upon theory (and to some degree politics) over practice and experience—which could and should only resonate from the realm of Third World self-determination. Thammasat University professor Thirayuth Boonmi was half right as he recently claimed that “Western Knowledge constructed and transformed Third World people into objects of labor (Boonmi, 2003)”.

[Structural Adjustment and Neocolonialism]

In 1944, the United Nations established the Bretton Woods System, a two-pronged system consisting of the International Monetary Fund (IMF) and the International Bank of Reconstruction and Development (also known as The World Bank). The Bretton Woods system’s strategic objectives were designed to curb economic nationalism, promote stable exchange rates, encourage the growth of world trade, and facilitate international movements of capital; yet, the counter-position suggests that the global monetary system in the post-war years was not managed by a democratized international process, but instead micro-managed by the United States. The IMF was designed to alleviate foreign exchange crises through temporary borrowings, or ‘bail-out’ packages, yet the principle of ‘conditionality’ compromises a country’s control over their economic affairs.

Aid allocated to developing countries through the IMF has always come with ‘strings attached’. Such aid packages in recent years have been referred to as a Structural Adjustment Programs (SAP). In general, these packages include reductions in government expenditures on social programs (i.e., education, healthcare, housing), rigid and authoritarian labor policies (i.e., layoffs, wage-cutting, and de-unionization), the ending of subsidies or protective price controls, and an open door for increased foreign investment into the country in transition. The argument against the policies of the IMF suggest that methods such as SAP mirrors the neocolonialist practice of building an infrastructure (in this case a largely economic infrastructure) with foreign loans facilitating the extraction of profit out of the country the said loans were allocated to benefit.

Globalization presents many complications to be overcome, especially as it is the current modus operandi within which the Bretton Woods System functions. On the other hand, it is, whether we agree with it or not, an inevitable process that has led in many ways to the creation of renewed participation in civil society at the local level within the Third World. What Anthony Giddens has termed “The Great Globalization Debate”(to be discussed below in full detail) is instrumental in observing the shifting dynamics between economics and culture. If effective transitions toward democracy in the Third World are built from the ground up, how can globalization serve as the impetus for popular support? There are indeed strong social movements proclaiming resistance to global manipulation and exploitation of the Third World. A closer examination of such movements will demonstrate the importance of solidarity and a unified coalescing of movements within the context of the Third World.

Furthering the idea that countries follow different pathways toward democracy, Thailand and Argentina provide noteworthy case studies. Thailand, the fourth tiger, finds itself bouncing back from an economic disaster and has re-aligned its political policies around economic reform. Yet, its new experiences with democracy fall short of eliminating old paradigms: corruption, multilateral invitation, and social capital will be examined. Argentina, a country in seemingly perpetual transition, has managed to provide evidence that a strong ‘civil society’ is needed to further the prospect of democracy. Worker collectives, Non-governmental Organizations (NGO’s), and alternative methods of generating public participation encourage a democratic future for Argentina—which, like much of the Third World, wanes in the category of political stability.

Democracy is a foundation, but it is also a system of processes. This study undertakes the task of identifying the origins of democratic foundations that certainly pre-existed Western theories on ‘correct’ methods of democratic transition.

[The Great Globalization Debate]

Globalization is an economic, cultural, and technological phenomenon. It is an increasing all-encompassing reality for the lives of Third World inhabitants. As the subject of Anthony Gidden’s Runaway World, globalization is not a process but a series of processes. These processes yield transformations at all levels of society, while transmitting new forms of global interconnection. Yet, are these interconnections new, and are they perhaps only relevant against the backdrop of a historical economic continuity which has always existed? Or, do these global economic processes, signified by a Buenos Aires-based Citibank in Argentina or a central Bangkok Shell station in Thailand, for instance, demarcate a new era incommensurate with what’s come before? Perhaps neither of these descriptions of the process called globalization will suffice. Yet, it is in contrast to these two commonly held views that Giddens offers a third: the ‘transformationalist’ perspective.

The argument discussed within Runaway world is elucidated by adding a new dimension to what’s become known as the Great Globalization Debate. Within this debate there are dominantly two contending views. The first view, forwarded by the ‘skeptics’, holds that these global interconnections don’t exist to a degree which merit precedence over historical economic dynamics. These extensive and intensive levels of interconnection, according to the skeptics, are pre-existing and not always as global as they appear at first sight. To substantiate their argument, the skeptics contend that a large degree of trade is, and has historically been, orchestrated within a regional framework. Examples might include the trading blocks such as the European Union (EU), the Association of Southeast Asian Nations (ASEAN), or the Asian Pacific Economic Cooperation (APEC). Even without these trading blocks, geographic economic cooperation beyond a formalized organization can facilitate survival against other regions. The skeptics might point to the recent APEC meeting in Bangkok, where the largest delegation, China, is not a formal member but a strategic geographic partner.

A second view in the Great Globalization Debate, forwarded by the ‘radicals’—or the ‘hyperglobalists’, contends that globalization is quite new, and that the effects of this economic system can be felt everywhere. The ‘radicals’ assert that a new era of economic phenomenon produces economic, political, and cultural global connections. Furthermore, due to the transnational nature of this global interstate, and due to the emergence of a globalized society, globalization necessitates the creation of institutions of global governance. The global market-place is now less concerned with the boundaries of the conventional nation-state. Hence, the ‘radicals’ might argue, as a result of these global processes that one is more likely to be bombarded with telemarketers in Bombay (under the umbrella of a transnational corporation) than in Schaumburg in the year 2010. The old rules seem less relevant.

While there are valid points and some truth to the views of both the ‘skeptics’ and the ‘radicals’, Giddens assigns more weight to the ‘radicals’. However, in the end he contends that both perspectives are incomplete in that both the ‘radicals’ and the ‘skeptics’ are concerned with globalization as an economic phenomenon. Critical dimensions for describing the magnitude and effects of globalization are left out. For this reason, Giddens assumes a ‘transformationalist’ position. The transformationalist perspective contends that globalization is best understood, not as a static end, but as a multi-dimensional process with historically ‘transformative’ impacts such that its effects are often uncertain (this ‘uncertainty’ will later underscore his argument dealing with ‘risk’). Hence, Giddens distances himself from the likes of George Orwell and Max Weber who “anticipated a society with too much stability and predictability (Giddens, 2)”. Instead, he notes, “it [society] seems out of control—a runaway world (Giddens, 2)”. Giddens goes further to argue that both the ‘skeptics’ and the ‘radicals’ have ignored the most ‘transformative’ dimensions of global processes. “Globalization is political, technological and cultural, as well as economic (p. 10). Hence, as the radicals and skeptics have built their argument on the singular economic dimension of globalization (pro or contra), the transformationalist seek an understanding through the multi-dimensionality (e.g., political, cultural and technological) of global processes. The transformationalist perspective of globalization explains, to a large degree, the emergence of social movements in both Thailand and Argentina which will be elaborated upon below.

[Global Versus Local Structures]

The structures outlined above, from the Bretton Woods System to globalization theory to George W. Bush being the most distinguished guest at the recent Asian Pacific Economic Cooperation (APEC) meeting in Bangkok, underscore the omnipresence of dominant powers in the affairs of sovereign nations. In Thailand, as well as in Argentina, there have arisen movements that seek to re-assign the prominence of power and decision making to the local level. Democracy, if it is in actuality a process, will be judged on the extent to which these local structures, whether they are citizen action groups or worker’s collectives, are successful.

Thailand, particularly, is influenced by the cultural transmissions of globalization. One example of the rapid pace of this macro change that has swept this tropical nation is demonstrated by the gathering of prominent art researchers, anthropologists, and historians at a recent seminar entitled “Arts and Society: Preservation of Culture”. The sponsor of this seminar, The Office of the National Cultural Commission balances the various research proposals put forward by the aforementioned groups and evaluates their utility to society (or more specifically, evaluates the ‘dominant forces’ who shape Thai society). As a result of the emerging discussion, 131 grants have been awarded to this cause of “cultural management” (The Nation 2003). In other words, because globalization is transmitting a new type of monolithic international culture, the government sponsored Thai academy seeks agreement upon what defines Thai culture so as to preserve a particular aspect of it. Perhaps one positive effect of globalization, then, is the articulation of what constitutes culture. Its benefit is also its downside as agreement toward a national culture narrows the scope of focus with regard to other ethnic groups that have historically entrenched their own niches within Thai society (i.e., the Akha and Hmong hill tribes in the North, and the Muslim minority in the South). As tourism continues to dominate the economic landscape of Thai society, the drafting of national culture through meetings such as “Arts and Society: Preservation of Culture” can easily fall victim to the pitfall of foreign consumer interests (i.e., tourists, foreign investors, etc.). Weighing the influence of both culture and economy, the term “shot by both sides” might resonate deep within Thai society.

[Fostering Civil Society in Thailand]

In Thailand, the twentieth century ushered in a period of perpetual transition, in line with the aforementioned ‘transformationalist’ view, within various sectors of Thai society finally arriving at the somber embrace of globalization—with a few politically-motivated exceptions. Its first experience with democracy at the institutional level began in 1932 when the Peoples Party gripped the reigns of power by mounting a revolution against the absolute authority of the reigning monarchy (Ungpakorn 2002, 2). The revolution was fueled by social discontent and economic hardships of the peasantry on one hand, and exacerbated by influential Western models of governance on the other hand. Until the 1970’s, tight bureaucratic control was perpetuated in order to minimize discontent and continue the traditional mode of combining privilege with power and control. The strong arm of the military would facilitate the stability required for rapid development into the early 1990’s. Two primary movements demonstrate the workings of civil society in Thailand: the middle class-fueled student movement, and the emergence of Non-governmental Organizations (NGO’s) at the base-level of society.

The increase of student enrollment in the Thai higher education system derives its impetus from rapid economic development, which is not to say that the expansion of student numbers didn’t arise out of earlier hardships. In fact, between the 1950’s and 1973 the minimum wage remained the same while commodity prices increased by 50 percent (Ungpakorn 2002, 3). Workers rights were repressed and the frequency of strikes increased due to declining worker conditions. It is fair to contend that increased repression within the worker rank-and-file carried over into an expanding number of students who would also become victims to the strong arm of the governing military dictatorship. Student activism, including written critiques of government tactics and demands for the opening of a more democratic society, frequent demonstrations, and campus organizing culminated in the arrest of academics and students who had been influenced by the revolts and revolutions taking place all over the world. The anger which fueled discontent among the students, however, was not consigned only to mere homegrown elements. The students and the main current of opposition were also mounted against capitalism and the forms of exploitation inherent in its role in the economic development of Thai industry.

This activism developed into the 14 October 1973 large-scale protest demanding the institution of a new and democratic constitution. 400,000 students (and workers) organized the largest demonstration of its kind to date, which ended in the military firing into scores of non-violent protestors (Dovey 2001, 276). A similar demonstration on the 6th October 1976 resulted in even more Darwinian military tactics. Unarmed students and workers were gunned down in the street, hung on trees lining crowded streets, dragged out of university campuses, and in the most extreme cases (though all are “extreme”) burned alive (Ungpakorn 2002, 4). Similar dogmatic Hobbesean tactics were employed in the mass student uprising of May 1992, which after scores of student and working class deaths, officially overthrew the military regime. Though the primary objective of the student movement in Thailand was to strengthen civil society by reducing the power of the bureaucratic state, the military-perpetuated violence, instilled in order to facilitate development, would remain a continued theme in the future of Thai politics—and specifically with regard to the notion that Western-influenced modernization was in part responsible. As Kim Dovey notes, the symbols of the Western hand in the Thai military apparatus were everywhere, and can be traced back to its 1932 foundations, which were constructed by the union of Western-educated Thai intellectuals and the military who usurped power(Dovey 2001, 272).

Of course, struggles for the emergence of a functioning civil society must exist at the grassroots level of the nation-state, and the Non-governmental Organization (NGO), and its positive presence within Thai society, is demonstrative of this concept. The Thai NGO, Assembly of the Poor (AOP), is an important precedent toward this assertion. Grassroots movements, spawning from a similar impetus as that of the student movement, have organized around its discontent for Western influenced development—specifically, the policies of neoliberalization. Proponents of neoliberalism contend that progress and social justice are achieved by presenting top-down (bureaucratic) economic policies as the primary imperative of governance. In Thailand, this amounted to elevated levels of inequality. As Thai Scholar Suthy Parsartset contends, “we can safely state that more than ten million people, mostly rural and urban poor in Thailand, who were marginalized by the process of urban-biased state’s development policy during the last three decades (Parsartset 1999, 3)”. Not only do the development demands of neoliberalism create inequality, but they displace thousands of the Thai poor. The new construction of dams, reservoirs, highways, and other infrastructure projects (funded largely by foreign capital), overtook the agricultural welfare of Thai farmers while also displacing entire communities.

One event firmly implanted in the minds of many Thai villagers was the “Khor Jor Kor Scheme”. “Khor Jor Kor” literally translating as “village surround the forest” was developed in the late 1970’s by the military as a method to combat reclusive anti-government, often Communist, enclaves by encouraging loggers to remove the heavily wooded forest within which they resided (Dechalert 1998, 6). The peasant loggers were promised that if they removed the trees, they would be granted permits to occupy and receive rights to the land. After this war on anti-government forces became less relevant (as the bulk of trees had been largely burned and removed), peasants were forcibly removed from the land initially promised to them in order to make way for the government subcontracted development of ‘reforestation’. In affect, this development had been motivated by the government aligned neo-liberal policies to meet the world-wide demand for wood chips and paper pulp.