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Asian values: A driving force behind the economic success. SECTION 1. INTRODUCTION
            The concept of value-based explanations of economic growth has been more commonly attributed to non-Western rather than Western attributes.  Economic development has recently been following the rapid transformation of East Asian economy and society.  Attention in particular has shifted to the special virtues of Confucianism, largely regarded as the culture tie binding much of East Asia.[1]  The typical perception of modernity is that it replaces culture and tradition.   In fact, a review of related literature would indicate that modernity has replaced tradition in the process of development of many countries.[2]  Pursuant to this theory, tradition and inherent cultural values play no role in development, and in fact have been widely regarded as obstacles to both development and modernization.  Yet in the late 20th century, it is apparent that neither modernization nor revolution have completely replaced tradition, as is most evident in the case of the newly industrialized countries (NICs) such as Hong Kong, Singapore, Malaysia, Thailand and Singapore. In the case of NICs, traditional Asian values in fact are deemed as maid-servants of industrial revolution[3]
            According to the German economist, Friedrich List,[4] nation states have come to play a vital role in economic development.[5]  List argues that universal economic laws are non-existent, and thus allowing the states the right to intervene into the economic development of their respective countries.   Particularly in the case of NICs, the promotion of national economic development has been regarded as critical in their success in catching up with the industrialized and developed world.  Based on List’s theory of the role of states in economic development, NICs have been allowed to shape their own economic future especially since there are no universally economic laws as postulated by the liberal economists.[6]
            The last few decades have been regarded as significant in the economic progress of East Asia.  Despite the current financial crisis, the economic achievements of NICs nevertheless remain extremely impressive.  This economic success has been accompanied by the emergence of the role of Asian culture in achieving economic success as well as political distinction.   This theory draws directly from the experiences of fast economic development in a number of Asian economies such as Japan, South Korea, Taiwan, Hong Kong, Singapore, and most recently, China.  An emerging theory attributes these success partly, and even largely, to the role of Asian cultural values, and in particular, to Confucianism.[7]
This paper will study the role of Asian and Confucian values, as unique values and traditions embedded in the cultures of NICs, as helpful tools in economic development rather than obstacles to economic growth.  The research topic is relevant in that it will attempt to analyze whether there is really something remarkable about the contribution of Confucian or other Asian values in promoting economic development in NICs.
East Asian countries all have a Confucian cultural heritage which dates back many centuries.[8]   What exactly are the contributions of Confucian or other Asian values in promoting economic development in NICs?  Is the causal linkage between these Confucian and Asian values and economic development significant enough to give rise to a cultural evaluation in terms of the economic potential of such values?[9]
The significance of value-based explanations of economic growth has not been particularly easy to vindicate.  Value-based accounts of economic performance have often been arbitrary.  The industrial revolution occurred first in Europe, not Asia, and even before that, changes known as the European Renaissance had been transforming the face of Europe, starting with Italy, before similar changes started to occur in Asia.  After the Second World War, most of the colonies of the Western powers in Asia, Africa, and Latin America, eventually gained independence.  As newly emerging states, they single-mindedly pursued a common goal: economic development.  The model of development was already provided for, having been gathered from the wisdom and experience of centuries, as well as from the influence of former Western colonizers and the Western world as a whole.   Since the European Renaissance, the Western world developed a view of life and a code of values which they claimed and believed to be universal.  This was also true of their development strategies.   For a very long time, people wondered what made European values so productive of social results.  Such questioning followed closely on readings about economic, political, and military power, such as in the novel Rasselas (1759) by Samuel Johnson, which speaks of the northern and western nations of Europe as being in possession of all power and all knowledge.   Many people at that time wondered what values and which knowledge had permitted Europe to get so far ahead of Asia and the rest of the world.[10]
Unfortunately, it became apparent that these development strategies as applied in most Third World countries made these countries a little more dependent on the West, while locally the people in these Third World countries have not been able to improve their quality of life or to develop their own potentials.  Within East Asian national formations, some gains were made but these gains made the plight of the common people, the majority of whom live in rural areas, stand out more than ever.[11]
            The solution that has been proposed with regard to the development problems in East Asia is that development does not depend on technical skill alone.   Mere imitation of Western development strategies may not result in successful implementation in East Asian countries which are have deeply-rooted traditions and values completely foreign to the Western world.
There is thus a need to understand clearly the causal relationship among the social, cultural, economic, and political factors that determine the nature of the problems of development in East Asian countries.   There is a need to examine more closely each East Asian country’s own unique experience, to evaluate the successes and failures of the past, and to comprehend not only the structure of each of their given national formations but also the characteristics of their respective superstructures.  This is the only way to identify the interface of economic development and culture.[12]
            Outside the Western orbit, successful industrialization and modernization haven taken place in societies which have had traditionally high literate cultures, such as the NICs and Japan.  In most of these societies, there existed and still continues to exist two great traditions, Confucianism and Buddhism, both of which have greatly enriched the possibilities of human ingenuity for many centuries in these countries.   These traditions have promoted high literate cultures which have made the challenge of modernization much easier.[13]
            Japan emerged as the first non-Western country to achieve the status of an advanced industrial society.  Despite significant differences with the Western model, Japan is undoubtedly capitalist in character, and is considered a First World Asian country.   Modernity, and even hyper-modernity, is evident in Japan, but it is superimposed upon a civilization which continues to remain as emphatically different from that of the West.   For instance, it is a typical sight to see skyscrapers in Japan decorated with neon lights blinking messages in Japanese characters, or to see old ladies in traditional kimonos emerging from high-speed trains.   Even though there is an emphasis, in general, among NICs to pursue a Western model of modernity, it is still important to underline the difference of the nature of the economic system in East Asia – particular Japan and the “Four Dragons” – South Korea, Taiwan, Hong Kong, and Singapore.[14]
            East Asian capitalism, widely regarded by economists as a new type of capitalism, has evolved.  A fundamental element to East Asian development has been the focus on industrialization as opposed to considerations involving maximizing profitability on the basis of current comparative advantage.  What has been key to rapid industrialization is the concept of a strong state which provides directional thrust to the operation of the market mechanism.  It is this synergy between the state and the market which provides the basis for outstanding developmental experience among NICs.[15]
The conflict between cultural values and economic development does not seem to be a very big problem in Thailand.  The pillars of Thai cultural identity are the institution of monarchy and the religion of Buddhism.  The monarchy has been part of Thai society for over 700 years, without any interruption, with the king being much respected, loved, and revered, considered as the symbol of Thai identity.  On the other hand, Buddhism has been a way of life in Thailand for almost 800 years, and has been long considered as a significant force in culturally binding the hearts and the thoughts of the Thai people together.  In general, there is no ethnic minority in Thailand, with most of the considerable number of Chinese in the country having been integrated into the cultural mainstream.   Thailand is quite homogenous, with no aggressive conflict between Thai Buddhists and Thai Muslims.[16]
            According to the teaching in the Kalamasutta, a Buddhist does not accept anything merely because it is logical, said in the scripture, or even taught by his teacher.  Buddhism has taught the Thai to think for themselves and then to try it in practice, and to accept something only if it is good.  The principle of anatta (“no-self”) teaches the Thai not to have a strong attachment to things as everything is constantly changing.  Pursuant to this principle, there is no Being, only Becoming, and discourages the Thai to cling to permanence and identity.  This principle of anatta has been largely the basis why the values of flexibility and pragmatism have been attributed to the Thais.[17]
            The Thais have been often described as not being too conscious about self-identity, perhaps because they are so pragmatic or because they are already so certain about their identity.  Historically, Thailand has not shown resistance to foreign culture or civilization, and in the past, has accepted Indian culture, such as its religion, literature and language.  These foreign influences are modified and made into something that remains uniquely Thai.  At present times, the introduction of Western culture has become quite prevalent in Thai society, as with other NICs.  The majorities of the Thai people do not have a negative attitude towards Westernization, and believe that science, technology, and other things from the West can help develop their nation.   The value of anatta has made the majority of the Thai to wish to follow the Western traditions on technological process and the capitalistic way of development.[18]
            The only problem perhaps in the synergy between Thai traditional Buddhist values and economic development is actually two-fold.  First, there is that issue that material progress is advancing so fast that it has created social problems in Thailand such as immorality, selfishness, drug addiction and so forth.  Second, much of the criticism in Thailand is that the economic development it has been undergoing serves to make the rich richer, and the poor poorer.   What is being called for is not the coming back to self-identity, but to directly address these two issues in Thailand.
The founding fathers of the Republic of Indonesia were fully aware of the need for a national culture as a uniting force in the plural society of Indonesia and as the backbone to its economic growth.  The cultural foundation of the Indonesian national culture is in the form of Pancasila, or the Five Principles.  The Pancasila is a set of core-values which has been accepted by Indonesia as the National cultural identity, and it was formally confirmed as such in 1988.[19]
            One of the goals behind Indonesian development is to institutionalize the cultural identity of Pancasila in the daily life and socio-political and economic activities of the nation.  It means that social acceptance of the national cultural identity must be followed up with the inculcation of the core values of the Indonesian national culture as the national frame of reference to facilitate inter-ethnic and regional social interactions.  In such an implementation, the Indonesian government has to face internal and external forces.  The internal force which is less favorable in the promotion of Pancasila as the foundation of development is the plurality of Indonesian society.  It has a highly heterogeneous cultural background.  Although this heterogeneous culture has been formally considered one of the country’s great national assets, it can also cause problems as regional, community, and ethnic differences tend to serve as hindrances to achieving unity in the pursuit of economic growth.  The various regional and ethnic cultures interpret the sense of Pancasila differently, and this invites social tension even if they do not stimulate actual social conflicts.   The Indonesian National Constitution after all recognizes three categories of Indonesian cultures.  Therefore, the Indonesian may interpret and make his strategic choices referring to any of the three different cultures. The choice depends on what is most beneficial to the social arena they are involved in.  On the other hand, the government may also make its own interpretation and develop action to facilitate sustainable economic growth.[20]
            The heterogeneous cultural interpretation and action of the plural society of Indonesia are also reflected in the citizens’ response to national development programs.  In recent years, the governments has attempted to improve social welfare by emphasizing the economic sector, and has taken to applying modern technology with large-scale capital investment and intensive organization in the process of mass production.  These industrialization trends in Indonesia have stimulated the development of an industrial culture in the nation which facilitates those who can afford to control its national resources.  This has raised public reaction, particularly with regard to deciding development approach.  Heated debates on the Indonesian development approaches have been intensely reflected in mass media.  Those who can afford the cost of development argue that the development cake should be enlarged before it can be distributed evenly.  The starving commoners however prefer to initially share the cake to allow them to participate in the development programs in the first place.  In fact, most of the common people in Indonesia have nothing to contribute to the national development except their labor.  The economic poverty has strongly influenced their interpretation and action in the development program.   On the other hand, the rich has different ways in interpreting and taking part in the development programs as well, even though they share with the poor a common principle of the national identity of Pancasila – “social justice for all Indonesian citizens” and a “just and civilized humanity.”[21]
            Divine interpretations and actions based on Pancasila as the national identity have touched almost every industrial sector, such as the capital raising, management of production and the nature of labor. The Pancasila working arrangement is always multi-interpretable  — it depends on who, in what capacity, under what situation and why it happens.    The heterogeneous interpretation and implementation of Pancasila is also apparent in the way Indonesians respond to the ever-increasing foreign influences and international cultural encounters of their country with the Western world.   Indonesians react to the way youth and women have started to dress in Western fashion, and are likewise trying to hold the control of artistic life by preventing government involved by referring to Pancasila as their source of justification. The concept of Pancasila has also been exploited to legitimize socio-political interpretations and actions either conducted by the people or the government agencies.
Singapore, a highly developed and successful free market economy, enjoys a remarkably open and corruption-free environment, stable prices, and a per capita gross domestic product (GDP) equal to that of the most developed Western European countries.[22]
This corruption-free environment in Singapore, for which the country is renowned for, has been attributed to its high quality bureaucracy – usually a product of political and cultural tradition.  High quality bureaucracies in East Asian countries owe their existence to a long Confucian cultural tradition, where the elite bureaucracy, elected by merit, dominated the society.  Yet this high quality bureaucracy in Singapore cannot be clearly linked to Confucian tradition.  It may well be argued that it was really the transplanted British bureaucratic tradition, rather than the Confucian one, that formed the backbone of Singapore’s current administrative structure.  By not emphasizing on this cultural dimension of bureaucracy, it is implied that constructing a new and good bureaucratic tradition may not be as difficult to construct, as it is often believed to be.[23]
It should be noted that former Prime Minister of Singapore Lee Kuan Yew argued that democracy does not necessarily lead to development.[24]  In fact, he emphasized the importance of “good government” which is based on the Confucian ethics stating that rulers are expected to exercise their power with moral rectitude. Following this discourse, a good government must enforce strict laws and orders necessary to maintain a safe and stable society in order to ensure socio-economic development.[25]
In fact the economic success of Singapore has often ascribed to being directly fostered by downplaying political and civil liberties in favor of rapid economic growth.  Lee Kuan Yew has promoted political authoritarianism as the root for Singapore’s economic growth,[26] as can be evident by the strict laws in Singapore that govern the lives of its citizens (such as, the banning of chewing gums, and the penalty of caning).
Singaporean intellectuals and leaders (similar to Malaysia) argue that Asian civilizations based on communal ethics should not be forced to accept Western norms of individual rights.[27]   The “Asian Values” thesis of these Singaporean leaders is that the Western world refuses to accept the legitimacy of “Asian Values” because it cannot accept that East Asia is becoming a center of world power.  For economic success, correct economic policies are not enough.  These need to be coupled with non-economic factors, or these “Asian values”, which include a sense of community, nationhood, a disciplined and hardworking people, and strong moral values and family ties.  It is not simply materialism and individual rewards which drive Singapore forward.  What is stressed is the sense of idealism and service born out of a feeling of social solidarity and national identification.[28]
Yet it should be pointed out that there are certain weaknesses to Confucianism of this sort as followed by the Singaporeans.  As in the case of China, whenever there is a weak government, Confucianism can lead to nepotism and favoritism.[29]  It can also submit people into authoritarianism as the emphasis is on self-sacrifice for the sake of community.
Like Singapore, Hong Kong is not a democratic country.[30]   Described as a typical capitalist society, Hong Kong operates in a market economy under a laissez-faire policy wherein the Hong Kong government has kept itself removed from the market.  Although Hong Kong maintains particular structural differences with Mainland China, it does share a common heritage of Chinese tradition, typically Confucianism and collectivism.   This mixture of tradition and the mode of production in terms of socialism and capitalism has engendered different ideological or value structures characteristic of Mainland and Hong Kong Chinese societies.[31]
            Confucianism thus has been interpreted as the ideological and culture engine of economic growth in Hong Kong.  The central thesis is that Confucianism functions the way that Protestant ethics once did in Western Europe and America.   In other words, Confucian values that Hong Kong Chinese adhere to and that have contributed to the nation’s economic growth involve the demand for hard work, frugality, education, and the willingness to sacrifice one’s individual benefit for the collective good.[32]
Prime Minister Mahathir of Malaysia developed a Model of Asian Values similar to that of Lee Kuan Yew’s in Singapore.  Like Singapore, Malaysia emphasized the social and moral decay of the West in comparison to the new-found alternative model of Asian development.  Mahathir emphasized the “Asia-as-civilization” thesis which emphasizes the Asia region as benefiting from and strengthened by the fusion of the best practices and values from many rich civilizations, both Asian and Western; that many Asian values should obviously be destroyed, including feudalism, excessive anti-materialism, and excessive deference to authority; and that no one should be allowed to hide behind the cloak of cultural relativism.[33]
            One difficulty perhaps in strengthening cultural identity as the driving force in Malaysia is that it is a multi-level and plural society like Indonesia.  Malaysia sees itself as very much an Islamic nation, with this dominant religion playing a firm role in the country’s laws and policies.  The difficult relations between the nation’s various ethnic groups rests largely in the dominant divide between a modernizing government part and a more traditionalist Islamic party, the Parti Islam Se-Malaysia (PAS) rather than between Malay and Chinese political groupings.  Malaysia has been forced to address one of the great issues of present time: the contest between fundamentalist and more moderate visions of an Islamic future.   The concept of Islam Hadhari makes references to “faith and piety in Allah”, “cultural and moral integrity” and “safeguarding the environment” and has been widely criticized worldwide for being too vague and general.[34]
However, scholars have identified four key elements in the politics of Islam Hadhari: “First, it is being portrayed as a more civil society based approach that fits the aspirations of an increasingly educated, prosperous and cosmopolitan Malay community, at least in the urban areas. Secondly, it is being used as a slogan under which new education programs can be initiated for unpopular Islamic court officials and corrupt civil servants. Thirdly, the general principles are seen as a useful set of values for Malay capitalists in an era of globalization. The Prime Minister has stressed the need to ‘empower Muslims to face the global challenges of today’ and for ‘Malays to be more successful global players.’ Finally, on the world stage, it allows Malaysia to present itself as a model Muslim society in a post-September 11 world.”[35]
Identifying the necessary and favorable cultural preconditions for development in most of the industrializing Asian societies in important in understand what drives their economic success.  The behavior-oriented values and ideas of Confucianism, Buddhism, and other religions have over the centuries dug deep psychological and ethical habits along which the initial wheels of industrialization found it easier to run.[36]  This assumption is verified by the illustrative evidences from the East Asian NICs examined in this study.
Thailand has been guided by the Buddhist principle of anatta (no-self) which in turn has characterized its citizens with a degree of flexibility and pragmatism that allows them to embrace Western influences to development.  This lack of emphasis on self-identity however has brought forth a two-fold issue amidst the nation’s economic development: social problems such as immorality, and drug addiction that permeated its native culture, and the perception that the rich become richer and the poor become poorer.  Addressing this two-fold problem in Thailand’s economic development would be most effective by incorporating Buddhist values in which Thai cultural identity is deeply embedded.   According to Buddhism, wealth in itself is not something to be despised, and that a man who gets rich in a morally acceptable way and is generous can be a good Buddhist.[37]  To live well would mean aiming for a balance between material well-being and peace of mind.  When there arises a conflict between culture and development, the Thai should then strive to take the middle ground.  Upholding its Buddhist cultural values and material well-being are both good things, but to a certain extent, Thailand is finding out that it has to sacrifice the one for the other.  They recognize however that they  should not sacrifice all of the one for the other.[38]
            In Indonesia, the multiple interpretations and expressions of the national cultural identity of Pancasila has lead to social tension and likewise multiple reactions to governmental economic programs.   This has been attributed to the heterogeneous culture and plural society of Indonesia, where different ethnic and regional communities abound.  Similar with the issue in Thailand, economic growth in Indonesia has commonly been perceived is making the rich richer, and the poor poorer.  This economic poverty experienced by Indonesian commoners has strongly influenced their interpretation and reaction in government development programs.  Yet despite these different interpretations, cultural identity, or Pancasila as it is termed in Indonesia, is highly needed by every nation, especially for a nation with a plural society and heterogeneous cultural background.  The cultural identity is functional not only as an integrative symbol for Indonesians, despite their ethnic background, but also helps the society to ultimately reach a common interpretation and action towards government development programs someday.   To promote this however, the Indonesian government needs to allow responsive freedom to facilitate the people in interpreting and implementing cultural values into their daily life activities.[39]
Singapore and Hong Kong are similar in that they rely on Confucian values of self-sacrifice in order to drive its people towards a collective effort towards economic development.  In Hong Kong, the people adhere to the Confucian values of hard work, frugality, education, and the willingness to sacrifice one’s individual benefit for the collective good.[40]  Singapore on the other hand is ruled by an iron regime, and authoritarian rule that insists that one cannot force Western norms of individual rights unto Asian.   The dark side however to these values of self-sacrifice for the good of the nation is that it tends to include excessive materialism and an inclination to authoritarianism, as is clearly the case with Singapore.  Singapore also tends to do away with the Western concept of emphasizing individual rights and adversarial politics in favor of a socially cohesive and duty-emphasizing nation.  This approach may perhaps be potentially dangerous and non-sustainable as it has resulted in the breakdown of family ties and increasing societal problems in some Asian countries.[41]
In Malaysia, the concept of Islam Hadhari has been used greatly as an attempt to provide social cohesion amidst its multi-level and plural society.  Similar to Singapore, the Malaysian government emphasizes that Western norms cannot be forced unto its citizens, and instead relies on religion in helping to shape the country’s national identity.[42]
The problem is that the authoritarian rulers in Singapore and Malaysia are struggling not to be the newest members of the Asian global cultural modernity, despite socio-economic and political forces that are propelling them to this evolving sphere of Asian civilization. Key intellectual and civil society leaders in both countries are urging their governments to become members of the community of democratic states, such as the Philippines.   But both countries have consistently resisted the need to convert to a democratic government in order to achieve economic growth and development.[43]
Despite the Confucian revival, particularly in the 1980s, and what has been described as its emerging role as a central ideological concern in global capitalism,[44] it is erroneous to attribute economic growth in East Asian NICs solely and entirely to Confucian values.  With the onslaught of modernization, the Confucian tradition of placing importance to the family as a natural and venerable social institution has transformed the family into an efficient unit of industrial production.  Yet this actually goes against traditional Western concepts of modernity where feudal loyalty and the extended family are considered as anathema.[45]
Thailand’s cultural background is Buddhist rather than Confucian, like Japan, Korea, and China.  Buddhism is a radically different tradition from Confucianism.  Indonesia also has a strong Buddhist cultural background, in addition to Islamic and Hindu traditions.  Past accounts of sluggish economic growth in these countries have now given way to explanations of economic dynamism, with the identification of other values and other connections not necessarily attributable to Asian or religious cultural values alone.[46]
            In raising doubts in explaining East Asian NICs’ economic success in terms of Asian values, it is not the intention of this paper to argue that there is nothing to learn about the role of values from the spread of economic growth and development in Asia.  Some important lessons emerged from this study, but they do not include anything as definitive as stating that Asian values enjoy a special fitness to modern economic growth.   In fact, the most important lesson may actually be a negative one – that Western culture is not the only road to modern success.  But the disestablishment of an earlier pro-Western, or specifically, pro-European prejudice as the sole route to economic growth, should not be confused with the establishment of a new set of values in favor of Eastern Asia against Europe and the rest of the Western orbit. Admittedly, there are special features in East Asian economic development that are attributed to its own unique Confucian, Islamic, Buddhist, and other Asian values, such as the Thai principle of anatta or the Indonesian concept of Pancasila.  But the emphasis on skill formation, education, and a more friendly and collaborative relation between the state and the market are not special features of “Asian values” or things that other countries cannot follow with equal ease.[47]
It cannot be denied that nations such as Singapore and Malaysia have utilized Asian values as a tool towards maintaining authoritarianism in their countries.   This may have been criticized as shameful, mainly since it denies basic rights and civil liberties, but these countries maintain that to say freedom is Western or “un-Asian” is offensive to their traditions.  There is an insistence that Asian cultural tradition lays great emphasis on order and social stability, and points out that Asian nations throughout history have fought against tyranny and injustices.  Society should not be perceived as a kind of “false god” upon whose altar the individual must constantly be sacrificed.  No Confucian, Buddhist, Islamic, or Asian value in general can be cited to support the proposition that Asian individuals must melt into a faceless community in order to achieve economic success.[48]

Asian values: A driving force behind the economic success

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