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of Economic Development: with a Focus on the case of Taiwan.
It must be pointed out that statism is not a holistic
entity. Rather, it is assigned to those studies with
heterogeneous intellectual roots that in various ways elevate the
state to the highest status. Thus, as the forerunner of statism,
Amsden (1979) may not have any dependency predisposition in her
study, except concluding that dependency theories are inadequate
in explaining Taiwan's story. Similarly, Cumings' article
(1984) on the development of Northeast Asian economies, mostly
often cited by statists, is actually based on the economic theory
of product cycles and on the analysis of authoritarian regimes.
On the other hand, taking the vein of dependency theories, Crane
(1982) argues that ascent in the world system is possible if the
state plays an active role. Dissatisfies by vulgar
interpretation of dependency theories, Evans (1987) sets out to
reinterpret them by adding some factors that have thus far been
neglected.
Although basically a synthesis of both modernization and
dependency theories, statism leans heavily on the latter, since
most of its proponents, explicitly or implicitly, take the tenet
that dependency will ultimately lead to underdevelopment. In the
case of Asian NICs (New Industrializing Countries), the structure
of the world system provides a favorable environment for
development (Crane, 1982). More narrowly, it is the benign
capitalist core that dictates the general direction of their
developmental process. At times, American aid officials formed
alliance with Western-trained technocrats and adopted what
strategies they deemed appropriate.
Nonetheless, the statist prediction is less deterministic,
in that the gloomy destiny dictated by external factors may be
changed by the state under certain circumstances. To the
extreme, Haggard (1986) claims that the ultimate decision is made
domestically. Accordingly, it shares some commonality with
theory of modernization by accepting that some internal factors
can not be dismissed. However, by so doing, it is surely
undermining the theoretical purity of dependency theories.
Having recognized that decision-makers in Taiwan are by no
means true believers in laissez-faire, statists judge that
Taiwan's success was not the result of free market, as neo-
classical economists have celebrated. They are equally
dissatisfied with the apologetic, or defensive attitude assumed
by dependentistas, who tend to dismiss it as a deviant, if not
unique, case and thus refuse to take it into account. It is
concluded that the failure of dependency theories lies in their
exclusive weight assigned to such external variables as
imperialism. Instead, endogenous productive and social relations
are posited to be the primary explanatory variables (Amsden 1979;
Evans, 1987). The novel approach is thus an attempt to improve
dependency theories by adding the active, if not
interventionalist, role played by the state.
In the academic arena, it is not uncommon for an one-time
defeated approach to resurrect by integrating certain elements
from competing approaches. To be ontologically consistent and
faithful, statists must specify outright what they believe to be
the ultimate determinant of changes. It could be either the
systemic factor or the internal factor. They could also take a
dialectic perspective: It is the interaction between the two sets
of factors that determine changes (Wendt, 1987).
It appears that statists never pay attention to the agent-
structure. Therefore, while holding that external factors
largely decide the fate of the state, they claim that the strong
state may play an active role in national development. It is not
clear in their discussion as to which factor dominates. Nor do I
ascertain any implication that the relation is interactive.
However, as long as the revised theory is coherently constructed
and is not hastily amalgamated, I am willing to evaluate its
explanatory validity.
MAIN THESES
Realizing that the original context within which dependency
theories were formulated is too parochial, statists believe that
more universal regularities may generalized by taking lessons
from economic performance in NICs. They contend that dependent
development is possible if the state plays a more role in the
process of economic development. More specifically, negative
consequences from dependency may be mediated by state
intervention. Moreover, growth and equity may be reached with
proper manipulation of strategies. All these are based on the
existence of a strong state.
Since the concept of strong state is generally taken for
granted by statists, there is no serious attempt at defining it.
It is not surprising that some confused with the concept of
strong bureaucracy (Barret and Whyte, 1982), authoritarian
regime (Clark, 1987; Cumings, 1984; Gold, 1986), or military
regime. Some time, it is reduced to the existence of a
"cohesive vanguard" political party behind the scene (Evans,
1987: p. 212; Huang, 1989). Such a narrower conceptualization
makes the strong state lose all its independent explanatory
power. In other words, we are not sure whether it is actually
the "strong" state, or the "strong" party, or simply political
suppression of the authoritarian regime that has contributed to
economic development.
There is another flaw inherent in this unrefined
conceptualization. By portraying the strong state as an
omnipotent one, it neglects the existence of other social forces
and treats the society as passive. Moreover, in terms of
empirical observation, by grossly classifying states into the
dichotomy of relatively strong and weak ones, it lacks the
sophistication needed to discriminate diverse degrees of economic
development, which makes cross-national comparison less tenable.
I have come to discover that most hasty application of the
concept of strong state fall into this category.
A more satisfactory definition is derived indirectly.
Skocpol (1985: p. 9) defines state autonomy as the degree to
which states "formulate and pursue goals not simply reflective of
the demand or interests of social groups, classes, or society."
By equating the strength of the state with its autonomy, the
definition points out that the strength of the state is not only
determined by its organizational coherence but also by its
relations with social forces. Hence a generally accepted
theoretical definition of state autonomy: the extent to which the
state is able to insulate itself from domestic dominant classes
and to contain, or even suppress, their interests in policy-
making.
By Skocpol's definition, the strength of the state is
determined by the strength of the society. State autonomy is
thus a relative phenomenon. And it allows for only either a
strong state or a strong society. Consequently, it is difficult
to measure the strength of the state without simultaneously
comparing it with that of the society. As a result, a feasible
yardstick of the strength of the state, or of state autonomy,
turns out to be policy efficacy. A strong state is one that has
witnessed successful economic development. And what has
contributed to the success? It is the strong state!
Further, it leaves no room for the situation when both the
state and the society are strong at the same time. Under such a
circumstance, the state is not qualified as strong, since it
fails to dominate the society. The situation when both are week
becomes irrelevant and is thus neglected here.
Moreover, there is no agreement as to whose interests the
state should contain. Ideally, according to Skocpol, it should
include all interest groups. But most studies focus on the
dominant class, especially the capitalist class. Since class
stratification may not be significant in all NICs, the emphasis
of class cleavage may be misleading. Failure to recognize the
existence of such social cleavages as ethnic ones may render the
notion of state autonomy useless, since policies may be pursued
in the guise of national interests but is actually for the
benefit of the dominant ethnic group.
In the case of Taiwan, while class had never been a useful
concept until the beginning of the 1980s, ethnic cleavages
between the dominant Mainlanders and the subordinate Taiwanese
have been the most important, if not the only, underlying factor
dictating major policy debates. There is no so-called dominant
class other than a dominant ethnic group. The only exception is
the piece by Rueschemeyer and Evans (1985), which cautions that
ethnic cleavages may penetrate the state apparatus and thus
"delitate" the state. However, under such a circumstance, the
so-called strong state ceases to be an independent explanatory
variable.
There is no lack of more sophisticated formulation of the
intertwined relationship between the state and the society.
Migdal (1988), for instance, generalizes some conditions for the
creation of a strong state. In the case of Taiwan, Evans (1987)
argues that the state was relatively autonomous owing to the fact
that foreign capitalists lacked interests, that the landlord
class have been eliminated, and that the local capitalist class
was weak. In his parsimonious triple-alliance model, the state
uses local capitalists to counter international capitalists.
Applying Evans' model, Gold (1986) finds that the division of
labor among the state, local capitalists, and international
capitalists, has made Taiwan devoid of negative consequences from
structural dependency.
To conclude, by including all those variables, statists are
undermining their own alleged domination of the strong state.
Statists may argue that as long as the state is strong, or the
state dominates all social forces, their prediction of dependent
development still prevails. However, since state autonomy is
further conditioned by the strength of the society, the
independent explanatory power of the strong state is lost.
POLICY ANALYSIS
Judging from Taiwan's engagement in international trade
and reception of foreign investment, statists assign it the
status of being dependent. According to the prediction of
dependency theories, underdevelopment should follow. However,
why has Taiwan witnessed both growth and equity in the past forty
years? They claim that it is the state, including the Japanese
colonial government and the KMT regime, that have mediated the
negative impacts of foreign manipulation. For instance, Amsden
(1979) credits the state as "the key agent" in capital
accumulation, which is supposed to be rendered impossible under
condition of dependency.
In retrospect, we must agree that most policies implemented
by the KMT seemed to have been par excellence somehow. But many
questions remain to be answered. Why did the state decide to
undertake all those policies, such as land reforms, or the
decision to move from import-substitution to export-promotion?
More bluntly, did the KMT state actively pursue them or was it
pressed to adopt them? How did it succeed in formulating and
implementing these? And, more specifically, what capacities did
the state possess to accomplish all these? I shall endeavor to
answer these questions by examining two crucial policies pursued
by the KMT in the past, land reforms and export-promotion.
There is little dispute that land reforms were the major
accomplishment of the KMT, which provided capital needed for
industrialization, and contributed to the more egalitarian
distribution of wealth. But why did it decide to embark on such
programs, which are usually unsuccessful in the Third World? It
is usually explained away that the KMT did not want to repeat its
failure in mainland China. To defuse the threat from the
peasants, the justification goes, it had no choice but to
undertake the reforms. However, as Amsden had rightly observes,
the tenant-landlord relationships were not so sever as the KMT
had exaggerated. Therefore, there must have been other
reasons.
One goal was to destroy the economic base of the emerging
Taiwanese middle class, who took the lead in the 1947 uprisings.
After the reforms, most landlords became bankruptcy and had no
choice but to become farmers or proletarians. Further, by
eliminating the Taiwanese landlords, the KMT was able to collect
taxes directly from the peasants. The squeeze of the
agricultural sector under the KMT, which was more sever than that
under the Japanese colonialism, may have paved the way for
industrialization by providing for cheap food and hence cheap
labor. Still, the original goal could be to support the sudden
inflow of Mainlander refugees, who constituted the hard core of
the KMT regime. My argument is based on the fact that all direct
and hidden taxes were required to pay in kind. In a word, the
original goal may not have been so much for deliberate
accumulation of capital desperately needed for industrialization
than for the survival of the regime, or of the Mainlander ethnic
group as a whole, although later on the KMT may have discovered
that the two converged.
Hence, I am arguing that there may have been no long-term
linear policy-planning and that those developmental strategies
were but muddling-through piecemeal as a result of push and pull.
Those ad hoc problem-solving policies, although locally optimal,
were never meant for long-term planning. In reality, with its
obsession of retaking mainland China, the KMT never really
sincerely intended to develop Taiwan, not at least until the mid-
1970s, when Chiang Kai-shek deceased. Judging from its
conservative nature, which was developed from its past experience
in the civil war with the Chinese Communist, I discount the
active role played by the KMT in promoting economic development.
And the demarcation of the various stages of economic development
is nothing but post hoc explanation justified from current
rational viewpoint.
The same questions may be raised as to why export-promotion
was initiated after the first stage of import-substitution was
accomplished. In retrospect, the policy shift seemed to have
been consciously promoted by the KMT. Since further import-
substitution was not feasible for such a small island as Taiwan,
the market of which was easily saturated, export-promotion
appeared to be a rational choice.
As statists tend to use policy efficacy to evaluate state
autonomy (Rueschemeyer and Evans, 1985), the capacity the state
possesses is indispensable. Amsden (1979), for instance, uses
the capacity of the state to interfere or guide economic
activities, more specifically, the capacity to extract
agricultural surplus as an indicator of a strong state. In terms
of policy capacities, it is generally recognized that the
bureaucracy implanted from China was relatively well-developed.
Further, with the confiscation of all Japanese enterprises and
assets, the KMT was able to intervene in economic activities at
will. But monopoly of political or economic power by the state
is not equivalent to state autonomy. Nor can the possession of
capacities guarantee its insulation from the society.
I am ready to accept that those who took refugee in Taiwan,
rather than in Hong Kong or the United States, as true believers
of Sun Yat-sen's "Three Principles of People" and equipped with
the virtue of traditional intellectuals, were truly dedicated to
the development of the country. But they did not constitute a
holistic and unified whole. Not all involved in the decision-
making were convinced by the seemingly obvious rationale, not at
least those who believed in mercantilism and were against
entanglement with the capitalist world economy. In fact, there
was heated debate and Chiang made the final decision.
My knowledge of traditional Chinese politics tells me that
there are some competing elitist perspectives for explanation:
factionalism, leader-in-command, and ideological line. If we
accept the assumption that the state, in some way, could have the
perfect knowledge as to what is the best for the well-being of
the country, then we have to neglect the inner maneuvering among
bureaucracies, factions, or lines, who had their own interests as
a group, and treat it as a black box. This reductionism provides
no more insight than dependency theories
Even if we assume that the state is a holistic oneness with
superior knowledge, perhaps dominated by Chiang, it may not have
had any chance to arrive at the policy at is will. We should not
neglect the role played by American advisers, who, as they did in
land reforms, threatened to cut aids if the KMT did not comply.
Out of nationalistic consideration, the KMT was certainly
reluctant to admit any maneuver behind the scene. If so, the
autonomy of a strong state is confined to the case in facing
domestic interest groups. In other words, a state may still be
strong even though it has to yield to foreign pressure, as long
as it can insulated itself from domestic pressure. Thus this
type of state autonomy can not explain domestic development
sufficiently.
CONCLUSIONS
By bringing the state back, statists endeavor to explain why
some countries, especially the Asian NICs, are able to achieve
dependent development under dependency. They argue that it is
because of the active role that the strong state plays. Being
autonomous, the strong state is able to insulate itself from the
demands of the dominant group of the society, and thus to
actively formulate any policy that it deems optimal for the
general interests of the country as a whole.
Ontologically, statists fail to address the question as to
whether systemic or internal factors dominate in the process of
change. If they claim that the strong state is the most
important determinant, they share the same intellectual root with
modernists. If they believe that the strong state can only
operate within the framework delineated by external factors,
state autonomy loses most of its explanatory power. I have come
to discover that statists take the latter position.
Theoretically, statist explanation is incomplete without
further considering the relationship between the state and the
society. The degree to which a state is strong is not only
determined by its own organizational coherency, but also by the
strength of the society. A more fruitful discussion of change
should include the dialectic relation between the state and, for
instance, class. Then, they both should enjoy the same degree of
attention. In other words, by bringing other social forces into
the perspective, statism has lost its theoretic parsimony.
Empirically, an intuitive definition of strong state makes
it indistinguishable from such concepts as authoritarian regime
or military regime. Since it is a relative concept, the strength
of a state can not be measured simply by adding up its
capacities. Rather, it has to be adjusted by the strength of the
society. But no feasible operational definition is ever
seriously provided. A strong state is thus observed indirectly
from that of state autonomy, which is eventually measured by
policy efficacy of the state. It turns into a circular argument:
The policy is successful owing to the strong state; the state is
strong because its policy is successful.
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