Ejemplo de ABB en C

Having explained the developmental state’s ideological position (i.e. the head of Janus), I shall now move on to an examination of the two faces. The inner looking face of the developmental state is its comprehensive and coercive institutional interventions into domestic society. To recap, the bureaucratized state not only employed the brightest talent in each country, but also enjoyed an embedded autonomy that was highly effective in leading social transformation. In order to launch and manage these structural changes, the state first needed to secure its leadership or directorship. Indeed, the developmental states used strong ideological tools such as militarism and nationalism to tame society. On top of this, the states devised and mobilized a considerable number of forceful institutions and instruments to achieve this mission.

The starting point of this institutional intervention was the provision of a specific vision for the future. For example, East Asian developmental states were able to achieve a far more rapid industrialization than South American states because they focused on export-oriented industrialization, rather than adhering to import-substitution industrialization (Woo-Cumings, 1996: 325). It is notable that at its early stages, the developmental state itself was the sole agent with the potential to make this kind of ‘Big Push’ decision in Japan, Korea and Taiwan (Chang, 1999). The state made these decisions in accordance with future-orientated national strategic need, rather than with concern for the natural development of its private sector. Furthermore, these decisions made at every critical juncture in economic development were objectified into a series of five-year or three-year plans. These plans were used as an ultimate guideline or manual for the actions of both the public and private sectors, and showed businesses where to move and how to co-operate with each other, bringing down the transaction costs inevitable for these kinds of structural change. In short, the developmental state was indeed ‘an entrepreneurial agent’ (Chang, 1999: 194) that was, and had to be, able to set necessary focal points and signalling devices, as well as establishing the vision for and goals of long-term development instead of blindly following contemporary price signals or comparative advantage.

What kinds of institutions were adopted by the state to actualize these development plans? It is useful to remember that a ‘state’ is defined as a system ‘capable of restructuring its relations to social groups, as well as relations among those groups’. As explained, in the case of East Asian developmental state, its simultaneous embeddedness within social groups and autonomy from them was essential in

68 restructuring these relations smoothly but rapidly. When economic development is directed by state plans, the state tends to focus on two major relationships: those between the state and business, and those between the state and labour. The state devised many institutions to control these relationships, which can be categorized as relating to industrial mobilization and societal integration.

Table 3.1 The Institutional Intervention of the Developmental State into Domestic Society

Industrial mobilization in the state-business relationship was the main concern of the developmental states’ industrial policy. In both Japan and Korea, governments focused on nurturing national champions that could compete with the big companies in NDCs (Chan et al., 1998). The products of this extensive state support were Japan’s zaibatzu and Korea’s chaebol, huge conglomerates well known for their mammoth size and octopus-like scope (Woo-Cumings, 1999: 15-19). Various instruments were used to nurture MNCs (Multi-National Corporations) in each country initially for the goals of import substitution and subsequent export expansion (Amsden, 1989; Koo & Kim, 1992; Woo-Cumings, 1996; Pempel, 1999a). Firstly, the states provided their MNCs with huge subsidies coupled with tax exemptions designed to both encourage and compensate (i.e. for the risky entry into new industrial sectors or international competition and the maintenance of good export records). The state also regulated or punished the MNCs with rigidly powerful instruments, such as the credit-based financial system, (arbitrary) intensive tax audits, and even the withdrawal of import or export licenses. Finally, the states placed stringent limits on the entry of foreign capital and the activities of foreign MNCs to protect the international competitiveness of the national champions, by imposing massive quotas and tariffs as well as manipulating the price system and currency values. Therefore, born and bred under intense pressure from the state, these representative big companies in the developmental states should be seen as the connecting hybrid between the public and the private sectors.

While this reveals that the new MNCs in each developmental state were ‘quasi-state organizations’ (Woo-Cumings, 1999: 17), a discussion of their social integration will illuminate their roles in the private domain. As the state-directed plans were effective

69 in producing compressed economic growth, the zaibatzus and chaebols in the frontline of the development were able to provide millions of new jobs. This resulted in a conspicuous enhancement of welfare for ordinary people through the promise of life- time employment14 _{and concomitant housing, education, credit and other benefits. This}

is one of the reasons why the states did not pay much attention to the welfare policy until the 1990s; rapid economic growth contributed to significantly low unemployment rates, which in turn lessened the need for a national welfare system, especially because of the existence of a strong company welfare system. In conjunction with the externalities of rapid economic growth, such as the quality of life enhancements that followed increased investment in social overhead capital, this welfare promotion through the patriarchal relationship between father/companies and its children/employees played a pivotal role in assimilating the common people along with the alliance between the big state and big businesses.

A number of institutions were established by the developmental states to address the state-labour relationship on the basis of this alliance. First of all, the states ceaselessly stressed the importance of education in order to better transform ordinary people into the type of human resources required for state-led industrialization, and made formal educational credentials into the prime, as well as the most popular, channel for individual mobility into the political and economic elites. As Pempel (1999a: 169) notes, ‘education in all three countries [was] heavily geared toward the production of technicians, engineers, and businesspeople, which in turn [was also] conducive to economic growth based on manufacturing prowess’. The type of education was clearly significant, and technical subjects necessary for development were highly encouraged. In addition to formal education, mass conscription into the military and grand-scale mass movements, such as the New Life Movement set up by Chiang Kai-Shek and the New Village Movement by Park Chung-Hee, were important apparatuses for the development and mobilization of individuals in accordance with state-led industrialization designs.

The final sector from the diagram above relates to the socially integrative aspects of the state-labour relationship. Labour policy or, more accurately, labour repression policy was the main institution for managing this relationship, and it is the area in which the authoritarian character of the entrepreneurial state can be seen most clearly. As Woo-Cumings (1996: 337) asserts, ‘the flipside of the state-big business symbiosis was

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70 an effective suppression of popular protests and a thorough evisceration of labour as a political force’. All in all, the unskilled workers in SMEs were subjected to harsh conditions; extremely long hours, hard physically demanding work, and extremely low wages. Citing various concerns, such as international competitiveness, national security and firm-level paternalism, the state and businesses sought to curb the rightful claims of workers, and to keep labour weak and systematically exploited (Pempel, 1999a: 167). In this light, it can be suggested that, although the labour policy gave the appearance of being successful in conflict management and thereby produced a bright growth record for a few decades, it could not achieve societal integration in the real sense. In other words, the industrial policy for maximal industrial mobilization and the labour control policy for authoritarian societal integration are like the two sides of a coin in the institutional intervention of developmental states (cf. Cho, 2000: 409), which can be conceptualized as authoritarian entrepreneurialism.