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American Diplomacy
Commentary and Analysis

June 1999

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GLOBALISM
vs.
ECONOMIC NATIONALISM

THE SOUTHEAST ASIAN CASE

By Ronald D. Palmer
Ambassador Ronald D. Palmer contributes the following political and economic assessment of Southeast Asia, which may be read usefully in conjunction with the Woodrow Wilson Center’s special report, also to be found in this issue of American Diplomacy.

Ambassador Palmer, professor of the practice of inter-national affairs at the Elliot School of International Affairs, the George Washington University, Washington, DC, also is a member of the board of AMERICAN DIPLOMACY PUBLISHERS, this journal’s parent organization. His earlier article on Southeast Asia appeared in the Autumn 1998 issue of American Diplomacy.

~ Ed.

The Southeast Asia financial and economic

crisis of 1997 revealed various problems

in the region that the surging growth of the

early go-go 1990s had obscured. These

problems were rooted in outmoded political

and economic frameworks. They had various

sources, but many seemed to arise from

political and economic practices associated

with the persistence of inward looking eco-

nomic nationalism development strategies

designed for yesterday's world, in today's

information-based world economy which is

propelled by free trade, the market economy

and open capital markets.

I have retained several books on Southeast Asia I studied while in graduate school at Johns Hopkins in 1955-1957 and I refer to them from time to time to help maintain some perspective, especially when I use terms as I just did such as "outmoded political and economic frameworks" and "economic nationalism strategies designed for yesterday's world."

I think it useful to take a look at yesterday's world. At the outbreak of World War II, there was no region called Southeast Asia; it was given this name as a theater of military action by Lord Louis Mountbatten's headquarters in Colombo, Ceylon (Sri Lanka). There was little or no contact between the countries which looked outward thousands of miles to European or American colonial metropoles rather than inward to their nearby neighbors. The wealth of the East Indies enriched Holland; the wealth of Burma, Malaya, Singapore and Borneo enriched Britain; the wealth of Indochina enriched France; and the wealth of the Philippines enriched the United States. Only Thailand had escaped colonialism.

THE POWER OF NATIONALISM

Colonialism and anti-colonialism, imperialism and anti-imperialism, capitalism and socialism and communism, class warfare, white supremacy and nonwhite resistance — all seem rather antiquated terms now in 1999, fifty-four years alter the end of World War II in 1945 and year ten of the post-Cold War era. These ideas in their day, however, generated powerful anti-British, anti-Dutch, anti-French, and anti-American nationalist sentiment.

Few people remember that Japanese troops had the potential of being welcomed as liberating heroes when they occupied Southeast Asia. The brutality of the occupiers soon changed the minds of the occupied. Nevertheless, Thailand sided with Japan and the Axis for most of the war. Japan also had the help of the Vichy Administration in governing Indochina. By contrast, the Vietnamese communist leader Ho Chi Minh led the anti-Japanese resistance and had a close relationship with the American OSS espionage service. The Vietnamese Declaration of Independence, which Ho Chi Minh proclaimed in September 1945, looks a lot like the American document. But the French insistence on trying to reestablish their control of Indochina, with American Cold War support, ended any possibility for U. S. cooperation with Ho Chi Minh.

Indonesia
Japan, of course, provided military training in the East Indies to men such as Sergeant Suharto of the local formerly Dutch native militia force. The Japanese encouraged nationalist leader Sukarno to declare independence in August 1945. Like the French, the Dutch attempted to come back and reimpose their political control, but they were fought to a standstill in the 1945-1950 revolutionary war in which Suharto distinguished himself, rising to the rank of Colonel. The Dutch were supplied with financial and material Cold War aid by the United States from 1945-1949. The Indonesian-Dutch fighting ended, though, by 1950 when the United States decided to cease supporting the Dutch colonialists and, instead, to support Indonesian nationalism and independence.

Colonel Suharto served the Republic of Indonesia faithfully and became a two-star general under President Sukarno until the latter stepped down in 1967 as president in the aftermath of the abortive September 30, 1965, coup by pro-communist elements. General Suharto took over as president of Indonesia in 1967 and ruled until 1998.

Burma
Japan provided military training in World War II also to a cadre of Burmese leaders who became the icons of independent Burma. First among these was General Aung San, initially commander of the Japanese-trained Burmese National Army. He had organized the 1936 anti-British student strike of the University of Rangoon. Apparently a noncommunist, he helped organize the communist party Burma in 1939. He went to Japan for military training in 1940 and returned with the Japanese forces. He became Minister of Defense in the Japanese-installed government, heading the Burmese National Army which he extricated from Japanese control to form the Burmese Independence Army, and cooperated closely with the nationalist political front group, the Anti-Fascist Peoples Freedom League (AFPFL). He was the chief negotiator for the Burmese in the negotiations with the British. He became the leader of the AFPFL Government in 1946. The first act of his government was to exclude communists from AFPFL ranks. Aung San sought to meet the demands of frontier ethnic groups (Chins, Karens, Kachins, Wa and Shan and others) against the objections of ethnic Burmans. Aung San, however, had many enemies. He and six of his top followers were assassinated on July 19, 1947.

Aung Sang was succeeded by U Nu, who obtained independence from the British in early January 1948. The Communists split into so-called White Flag (majority) and Red Flag (minority) factions; they and non-Burmese ethnic groups and anarchic outlaw dacoit groups opposed the U Nu AFPFL Government. Burma began a slide into deeper and deeper political, security, and economic disorganization. There was a severe reaction against capitalism as it had been practiced by the British in the colonial era. Finally, the military under the Japanese-trained General Ne Win was asked to take power temporarily in 1958 in an effort to impose some order on the chaotic situation. Power was returned to civilians in 1960, but Ne Win and the military seized power in 1962 and established the military regime that has continued until the present. A salient feature of this regime was a reluctance to engage with the outside world politically or economically — Burma has essentially been a hermit kingdom since 1962. Under Thai tutelage, the Burmese military regime has slowly become more active in exploring commercial interactions with the outside world. Nevertheless, Burma represents the extreme example of Asian suspicion and nationalism.

The United States has sought to isolate and ostracize the Burmese military regime because of its human rights violations, including the house arrest of Aung San's daughter, Aung San Suu Kyi, who led an electoral coalition to apparent victory in the 1991 elections. The military annulled the election result. Subsequently, Aung San Su Kyi became a martyr for Burmese democracy and the symbol of Burmese nationalist and democratic aspirations.

Malasia
The after-effects of Japan's rule in Malaya (Malaysia since 1963) and Singapore persist. Prime Minister Mahathir's Look East Policy represents positive Japanese influence on him as a teenager during the Japanese occupation of Malaya. Mahathir's father was strongly anti-colonial and anti-West and imbued his son with these values. His father was reportedly a supporter of the pro-Axis Indian National Army leader, Subash Chandra Bose. Mahathir remains defiantly nationalist, anti-West and anti-colonial.

Singapore
Singapore's Lee Kuan Yew has written in his 1998 autobiography that despite the brutality of the Japanese occupiers, he was impressed with the effectiveness of their authoritarian control. Lee Kuan Yew expressed a theme in the book that has resonated throughout the region, namely, after Japanese rule, he and his generation would never again submit to foreign rule.

Philippines
These themes of anti-colonialism and nationalism had special relevance for the Philippines because it was the first Southeast Asian country to experience organized political nationalism. This was in the 1870s and 1880s when the target of Philippine nationalists was Spain. The Philippine insurrection began in 1897. The United States intervened in 1898 but did not control the Insurrection until 1911. The United States recognized the strength of Philippine nationalism and established a Commonwealth of the Philippines in 1935 which was to lead to Philippine independence in 1946. But the war intervened. Some eminent Philippine nationalist collaborated with the Japanese; some fought the Japanese bitterly. Independence came in 1946, but at the price of economic and political concessions, including the ninety-nine year lease by the United States of major military bases in 1947. Philippine nationalism finally forced the removal of American bases in 1992.

By 1997, the ten Southeast Asian nations, excepting Burma, were involved, at least nominally in the market economy. However, these connections were strongly conditioned by the strategies adopted in this post-colonial region after World War II. As former colonies, the new states had to confront both their limitations and their possibilities. Limitations included the necessity of building state structures appropriate to the requirements of independence and the development of their peoples. Their potential was to base such development on the proven capabilities of the commodity-production orientation of the colonial economies.


The following sections examine the question of globalism versus economic nationalism in Southeast Asia by dividing the years since World War II into the following periods:

Continue reading “Globalism vs. Economic Nationalism” (part II)   

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