Category Archives: economics

by | 17 September 2007 · 6:04 pm

Mexico’s Fayuca Boom and Bust

From True Tales from Another Mexico: The Lynch Mob, the Popsicle Kings, Chalino, and the Bronx, by Sam Quinones (U. New Mexico Press, 2001), pp. 239-240, 242:

Fayuca. The word meant contraband, illegally imported merchandise: stereos, televisions, calculators, cameras, silk shirts, tennis shoes, blue jeans, blenders, and blouses. The government slapped this stuff with steep tariffs when imported legally as a way of protecting Mexican industry. Tepito brought it in illegally. To Tepito, fayuca meant easy money and lots of it. Despite the official prohibitions, Mexicans gorged themselves on the outside world’s baubles. Tepito was their dinner table. It was a time tailor-made for the Tepito mind-set. In the go-go era of fayuca, what mattered was not what you sold or how you brought it in but how fast it would move. The trickle of suitcases containing small items like perfume, watches, and jewelry in the mid-1970s became, by the 1980s, torrential truckloads of twenty-one-inch televisions and full home stereo systems.

To a government running a desiccated economy, it quickly became clear that the contraband did two things. First, it appeased the middle classes, who didn’t really care where they bought this stuff so long as they could buy it. Second, fayuca also helped dampen inflation. The prices in Tepito were usually well below what the same goods sold for in the stores that had legally imported them. “The authorities wanted to lower prices without really entering the global economy,” says Gustavo Esteva, a sociologist who lived in Tepito for several years during the fayuca boom. “So the government used Tepito and the fayuca to fight inflation.” Though fayuca was illegal, it was bought and sold openly in Tepito. The regime couldn’t appear to allow it in and yet didn’t dare keep it out. Eventually the industry was carved up among Tepito’s fayuqueros, commandants of customs, the judicial police, the highway police, and other government officials. After a while the highway police in San Luis Potosí, midway between Laredo and Mexico City, decided they wanted their cut too. The wife of President José López Portillo, Carmen Romano, was said to be one of the greatest fayuca importers.

The arrival of fayuca was a key moment in Mexico’s economic history. Fayuca was in its own way as important in rocking the regime’s credibility as the 1968 Tlatelolco [student] massacre, the periodic peso devaluations, and the fraud-riven elections of 1988. Its presence showed that the protected, state-run economy no longer had a prayer of providing what Mexicans now expected out of life. Though Mexicans talked economic nationalism, they voted with their feet and mobbed Tepito, looking for the smuggled imports.

And for the first time Tepito got rich. In Tepito the fayuquero took the place of the boxer as the model for economic advancement, though in this case the road to riches was accessible to thousands of people and few of them missed the turnoff Since the fayuca, Tepito has produced no great boxers. Instead Tepito’s fayuqueros took on the status of legendary renegades; at least two B movies were made about them….

Mexico’s entry into GATT, then NAFTA, brought the fayuca boom to an end. The Mexican government began to lower tariffs on consumer goods. Customers began finding what Tepiteros were selling in legitimate stores that offered service, guarantees, and receipts and didn’t have thugs around the corner waiting to rob the clientele. When the peso was devalued in 1994, sales plummeted further. People still go to Tepito, since merchandise is a little cheaper and carries no sales tax. But the fayuca gold rush is a memory.

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Filed under economics, Mexico, nationalism, U.S.

by | 11 September 2007 · 6:17 pm

The Oaxaca Diaspora’s Protestant Ethic

My rule of thumb is to try to blog no more than about a page per chapter (depending on the lengths of the chapters) from the books I buy and read, but the following excerpt is from my favorite chapter so far in a book where I can hardly resist “reading aloud” every few pages. I was undecided about which of three thematic passages to cite: on Mexico’s Okies (the victim angle), Oaxacan self-help (the agency angle), or religion (the spiritual angle). I ended up concatenating two of the three. So I’ll have to do hard penance by biting my tongue through several other chapters. From True Tales from Another Mexico: The Lynch Mob, the Popsicle Kings, Chalino, and the Bronx, by Sam Quinones (U. New Mexico Press, 2001), pp. 102-103, 110-111:

Mexicans generally view the border and those who live there as only semi-Mexican—too close to the gringo, where too many of his ways are imitated. In truth, that is what shaped the [San Quintín] valley. With drip irrigation farmers saw the potential of growing for both the United States and Mexico and dropped subsistence farming for a very American capitalist ethic. Acres under cultivation went from two thousand in 1980 to almost twenty thousand in 1990. Nighttime electricity came to San Quintín. Then a few stores, a couple of motels, a movie theater, satellite television.

“I have uncles in the state of Zacatecas who grow chile,” says Ruiz Esparza, “They harvest the crop, but only apart of the profits goes back into the fields. They’re afraid of risking it all. Here, it seems they’re a little crazy. They risk it all every year. People here aren’t interested in having money in their wallet. Everything they have goes back into the fields.

“I look at the farmers of Oceanside, Bakersfield, Oxnard battling against the city, high water prices, taxes, and I see them keep going. They’re very brave. I think having those people before us as examples inspires us to do the same. If they can do it, why can’t we?”

From the north, San Quintín had its market, and from there it imported machinery, capital, and an entrepreneurial spirit. What the valley of San Quintín had never had was abundant labor. And that came from the south.

The Dust Bowl in all this became the states of Guerrero and, above all, Oaxaca, both states with enormous Indian populations who retain the customs and languages of their ancestors. Like the northerners with whom they now live, they are considered somewhat less than Mexican, disdained as “dirty Indians.” It was a strange yet perhaps appropriate pairing: two outcasts coming together to create something in the dust of the northern Mexico desert.

Agriculture in Oaxaca, like that in Oklahoma during the Depression, is a limp and stagnant thing. Inefficient farming and the division of land into ever smaller slivers have bequeathed the state a withering poverty, bloody feuds over land ownership, and generations of uneducated children. Hundreds of thousands of Oaxacan Indians—Mixtecos primarily, but also Triquis and Zapotecos—have been leaving home for four decades now. They are Mexico’s migrants, the cheapest labor in a cheap-labor country. “They provided labor that was easily exploited,” said Victor Clark Alfaro, director of the Binational Human Rights Center in Tijuana. “They were docile, didn’t speak Spanish, would accept almost any treatment and work hard.”…

But in Tijuana, migrant Indians also discovered San Quintín’s almost unquenchable thirst for cheap labor. Through the late 1970s and 1980s the valley evolved into a major stop on the Indians’ migrant trail, part of what came to be known informally as “Oaxacalifornia”—the diaspora that starts in San Quintín and runs through North San Diego County and up the state. Entire families came to the valley to live in labor camps designed for transient men. The camps teemed, and the work was tough in the hot sun and choking dust. But it was work, which was something Indians had never had in Oaxaca….

Indians transformed their new home when they came here to live. But just as profoundly, their new home changed them. And the clearest distillation of all those changes is the Protestant Church. “If you take a poll, you’ll find that 80 or 85 percent of those who are established here now are Protestant,” says Meza. That number might be high. But Protestant churches—especially of the more fundamentalist bent—proliferate in the valley. Indians here have become Baptists, Jehovah’s Witnesses, Pentecostals, and scads of obscure denominations to which Luther’s Reformation gave rise. The new churches are symbols of economic success, of modernity, of the monumental power and attraction of the United States. The adoption of a Protestant faith is almost standard issue in leaving Oaxaca for a future.

And that process is best told by one man who, now in his late forties, stands clapping in unison with the rest of the Apostolic Assembly of the Faith in Christ Jesus. Twenty years ago Luis Guerrero took his family and left his Oaxacan Indian pueblo and its traditions, moved to the valley of San Quintín, and hasn’t yet looked back in fondness.

Guerrero, a Mixtec Indian who speaks halting Spanish in a thick Indian accent, faced a brutish dead-end life as a subsistence farmer, depending on unpredictable rains, in the village of Santa María Asuncion, where landholdings were no longer measured in acres but in meters.

In 1972 Guerrero was among fifteen people who had to pay for the village’s traditional party for its patron saint, the Virgin of Asuncion. It was the custom: every year a few people had to become deeply impoverished to throw the three-day party for everyone else. His job was daunting: he had to give 2,000 pesos—the equivalent of two and a half years’ local wages at the time—to buy food and alcohol for everyone, fireworks, candles, and more. The responsibility almost broke him. He borrowed the money at high interest rates, then left his young family and pueblo for that year to pick tomatoes in Sinaloa to pay it back.

In 1974 he began migrating to San Quintín with his family. Finally in 1978 they moved here to live, leaving Oaxaca forever.

Away from the cloistered atmosphere of his Oaxacan village, Luis Guerrero began a religious and secular awakening, one he likes to illustrate by talking about the books he bought.

In San Quintín he bought his first book ever—a Bible. In Oaxaca he had never read a Bible; though the whole village was Catholic, no one owned one. Like everyone else, he depended on a priest to know what it said. “I began reading it and I began to awaken my mind…. I like knowing myself: I went to the Catholic Church, the Apostolic Church, Prince of Peace, Los Olivares, Jehovah’s Witnesses, the Open Door—to see how each denomination preached.” He finally settled on the Apostolic Assembly.

Now thirsting for more, he bought his second book—a copy of the Mexican constitution. “In our pueblos in Oaxaca, we didn’t know the earthly law, or how to defend ourselves [legally]. Also we didn’t know spiritual law. So I searched on my own to discover what constitutional law said. I searched on my own to discover what the Bible said so that I myself could understand earthly law and spiritual law.

“Earthly law allows you to speak up for your rights with the police, the bosses. That’s why I put forth an effort to learn it. [In the villages] people don’t have education. The [local] authorities pressure them to fulfill tradition. They want them to put on traditional parties. [In Oaxaca] you can’t give your children education because the little money you earn you have to spend on parties for the saints. Our children have no shoes because of tradition. We came here to leave all that behind.”

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Filed under economics, Mexico, migration, religion, U.S.

by | 9 September 2007 · 1:49 pm

Judt on New, Not Old, Fissions in Yugoslavia

From Postwar: A History of Europe Since 1945, by Tony Judt (Penguin, 2005), pp. 670-671:

Kosovo had historic significance for Serb nationalists as the last holdout of medieval Serbia against the advance of the Turks and the site of a historic battlefield defeat in 1389. The local Albanian predominance was thus regarded by some Serb intellectuals and politicians as both demographically troubling and historically provocative—especially since it echoed the Serbs’ displacement by Muslims as the largest minority in the adjacent Bosnian republic. Serbs, it appeared, were losing out-to hitherto subservient minorities who had benefitted from Tito’s rigorous enforcement of federal equality. Kosovo was thus a potentially explosive issue, for reasons linked only tenuously to ‘age-old’ Balkan feuds….

Whereas Serb dislike of Albanians fed on proximity and insecurity, in the far north of Yugoslavia the growing distaste for feckless southerners was ethnically indiscriminate and based not on nationality but economics. As in Italy, so in Yugoslavia, the more prosperous north was increasingly resentful of impoverished southerners, sustained—as it seemed—by transfers and subsidies from their more productive fellow citizens. The contrast between wealth and poverty in Yugoslavia was becoming quite dramatic: and it correlated provocatively with geography.

Thus while Slovenia, Macedonia and Kosovo all had approximately the same share (8 percent) of the national population, in 1990 tiny Slovenia was responsible for 29 percent of Yugoslavia’s total exports while Macedonia generated just 4 percent and Kosovo 1 percent. As best one can glean from official Yugoslav data, per capita GDP in Slovenia was double that of Serbia proper, three times the size of per capita GDP in Bosnia and eight times that of Kosovo. In Alpine Slovenia the illiteracy rate in 1988 was less than 1 percent; in Macedonia and Serbia it was 11 percent. In Kosovo it stood at 18 percent. In Slovenia by the end of the 1980s the infant mortality rate was 11 deaths per 1,000 live births. In neighbouring Croatia the figure was 12 per 1,000; in Bosnia, 16 per 1,000. But in Serbia the figure was 22 per 1,000, in Macedonia, 45 per 1,000 and in Kosovo, 52 per 1,000.

What these figures suggest is that Slovenia and (to a lesser extent) Croatia already ranked alongside the less prosperous countries of the European Community, while Kosovo, Macedonia and rural Serbia more closely resembled parts of Asia or Latin America. If Slovenes and Croats were increasingly restive in their common Yugoslav home, then, this was not because of a resurfacing of deep-rooted religious or linguistic sentiments or from a resurgence of ethnic particularism. It was because they were coming to believe that they would be a lot better off if they could manage their own affairs without having to take into account the needs and interests of underachieving Yugoslavs to their south.

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by | 25 August 2007 · 3:04 pm

Outburst of Piracy in Southeast Asia, 1754-1838

From Iranun and Balangingi: Globalization, Maritime Raiding and the Birth of Ethnicity, by James Francis Warren (Singapore U. Press, 2002), pp. 53-56:

The Iranun burst quite suddenly into Southeast Asian history in the second half of the eighteenth century with a series of terrifying raids and attacks on the coasts and shipping of the Philippines, the straits of Malacca and the islands beyond Sulawesi. Their primary targets were unprotected coastal settlements and sailing boats that travelled throughout Southeast Asia bringing valuable commodities from China and the West back to the most remote parts of the archipelago. Many of these marauders were sponsored by rulers from the trading states of Cotabato, Sulu, Siak, and Sambas. They were soon described as ‘Lanun’ or ‘Illanoon’—‘pirates’—by those who suffered their depradations or either travelled with or hunted them and wrote about their widespread impact on the Southeast Asian world.

It is estimated that during the last quarter of this century (1774–1798) of maritime raiding and conflict against the Dutch and Spanish, between 100 and 200 seaworthy raiding prahus set out from the Mindanao-Sulu area each year. The sheer size of the vessels—the largest joanga measuring upward of 130 feet in length—and the scale of the expeditions dwarfed most previous efforts, marking a significant departure in the naval strategy of Malay maritime raiding as it had been traditionally understood. The Iranun were far more than mere ‘pirates’ or brigands. The colonial powers and precolonial Malay trading states had to reckon with a dominant force in their own right; a force that was capable of inflicting major defeats on the Spanish and Dutch and toppling local kingdoms. The huge numbers of these skilled sea raiders and slavers that the sultanate of Sulu could mobilize during the heyday of the China trade would henceforth have a profound impact upon Southeast Asia’s history.

The geographical range of Iranun-Balangingi slave raiding activity was enormous, spanning all of Southeast Asia and beyond. Until the latter part of the eighteenth century, the joanga of the Cotabato and Sulu Sultanates were more or less integrated into fleets belonging to the respective sultanates, but by the end of the century many Iranun vessels were also operating independently. Iranun prahus sponsored by both states had their own target areas but inevitably, there was some overlap. Cotabato and Sulu raiding vessels cruised between the Visayas and Luzon, and out into the South China Sea. Those from Tempasuk, on the northwest coast of Borneo, harassed shipping to the west of the huge island itself. Samal Balangingi, situated midway between the Iranun communities in Mindanao and those on Borneo, operated vessels throughout the Philippines and in the central and eastern parts of the Netherlands Indies.

Iranun maritime raids affected virtually the entire coastline of Southeast Asia, and even stretches of New Guinea and the Bay of Bengal were not secure from slave raids. In the east, the Iranun sailed down the Makassar Strait to cross the Java Sea and South China Sea to attack the north coast ports on Java and the large tin mining island of Banka. Iranun raided extensively in the Sangir Islands, Halmahera and, to a lesser extent, in the Moluccas. They also pushed beyond the defended limits of the Southeast Asian world, crossing the South China Sea to attack undefended stretches of the coastlines of Thailand and Cochin China. At the opposite extremity they also raided, but failed to dominate, the dangerous coasts of New Guinea. In the 1790s, Iranun slave hunters in search of captives extended the limits of their known world even further, sailing far into the waters of the Bay of Bengal, touching at the Andaman Islands and perhaps exploring the southern coast of Burma. There seemed no practical way for the colonial powers to link their respective ‘dominions’ together in an island-wide network of defense and communication, and consequently the Iranun made the most of the ill-defended seas and ravaged the coastal populations and commerce….

In the second half of the eighteenth century many Philippine ports, towns, shipyards, and monasteries were not adequately defended while others were totally defenseless. From the mid-1750s onward, the scale, ferocity and unexpected nature of the initial wave of Iranun attacks were deeply disturbing. Thousands of Filipinos perished or were seized as captives; the more so as the Iranun were Muslims and recognized none of the accepted conventions and taboos that were meant to protect the property and personnel of the Catholic Church in times of war between Christians…. This terrifying period of Iranun slave raiding activity, which lasted more than 70 years from roughly 1752 to 1832, severely hampered the overall social and material well-being and growth of the Philippine island world and the colonial state.

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Filed under economics, Philippines, piracy, Southeast Asia, war

by | 7 August 2007 · 8:40 pm

Industrial Benefits of Downward Social Mobility?

Today’s New York Times carries a story about new research on the causes of the Industrial Revolution.

Gregory Clark, an economic historian at the University of California, Davis, believes that the Industrial Revolution — the surge in economic growth that occurred first in England around 1800 — occurred because of a change in the nature of the human population. The change was one in which people gradually developed the strange new behaviors required to make a modern economy work. The middle-class values of nonviolence, literacy, long working hours and a willingness to save emerged only recently in human history, Dr. Clark argues.

Because they grew more common in the centuries before 1800, whether by cultural transmission or evolutionary adaptation, the English population at last became productive enough to escape from poverty, followed quickly by other countries with the same long agrarian past….

Dr. Clark’s first thought was that the population might have evolved greater resistance to disease. The idea came from Jared Diamond’s book “Guns, Germs and Steel,” which argues that Europeans were able to conquer other nations in part because of their greater immunity to disease.

In support of the disease-resistance idea, cities like London were so filthy and disease ridden that a third of their populations died off every generation, and the losses were restored by immigrants from the countryside. That suggested to Dr. Clark that the surviving population of England might be the descendants of peasants.

A way to test the idea, he realized, was through analysis of ancient wills, which might reveal a connection between wealth and the number of progeny. The wills did that, , but in quite the opposite direction to what he had expected.

Generation after generation, the rich had more surviving children than the poor, his research showed. That meant there must have been constant downward social mobility as the poor failed to reproduce themselves and the progeny of the rich took over their occupations. “The modern population of the English is largely descended from the economic upper classes of the Middle Ages,” he concluded.

As the progeny of the rich pervaded all levels of society, Dr. Clark considered, the behaviors that made for wealth could have spread with them. He has documented that several aspects of what might now be called middle-class values changed significantly from the days of hunter gatherer societies to 1800. Work hours increased, literacy and numeracy rose, and the level of interpersonal violence dropped.

Another significant change in behavior, Dr. Clark argues, was an increase in people’s preference for saving over instant consumption, which he sees reflected in the steady decline in interest rates from 1200 to 1800.

“Thrift, prudence, negotiation and hard work were becoming values for communities that previously had been spendthrift, impulsive, violent and leisure loving,” Dr. Clark writes.

Around 1790, a steady upward trend in production efficiency first emerges in the English economy. It was this significant acceleration in the rate of productivity growth that at last made possible England’s escape from the Malthusian trap and the emergence of the Industrial Revolution.

Well, I don’t know. Sounds like the English became more Scottish and less Irish. But it does seem to me that temporary downward social mobility of many, many ambitious immigrants has made a huge contribution to the continuing health of the North American economy.

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by | 13 April 2007 · 6:16 pm

Japan Focus on Ethnic Koreans in Yanbian, China

I’ve been preoccupied with other matters lately and slacked off blogging a bit, but I meant to excerpt a few passages from an interesting portrait of ethnic Koreans in Yanbian, China, that appeared recently in Japan Focus.

The current Korean population in China is of rather recent origin. A wave of migration from the Korean Peninsula began in the 17th century. However, most of the migrants arrived during the tumultuous decades between the middle of the 19th century and the end of the Second World War. Northeast China was first a refuge for poor peasants and later a base for Korean nationalists, who fought against the Japanese colonial rulers in the period 1910–45. After Japan annexed Northeast China in 1931, hundreds of thousands of Koreans migrated to the new Japanese-dominated state of Manzhouguo, including many forcibly sent to work in factories and mines. However, the vast majority of migrants from Korea came allured by the promise of land.

When Japan was defeated in 1945, there were 1.7 million Koreans in Northeast China. When the People’s Republic of China was established in 1949, some 600,000 Koreans returned to the Korean Peninsula, while 1.1 million remained in China. China’s ethnic Korean minority presently totals roughly two million people. Most live in Northeast China, with a dense Korean population in Yanbian on the North Korean border. The number of ethnic Koreans in Yanbian is about 200,000, 38 percent of the prefecture’s population. An estimated 80 percent of the Yanbian Koreans have their roots in contemporary North Korea, and 20 percent have their roots in South Korea….

A closer look at certain elements of Koreanness that Yanbian wished to rely on reflects the complexity of ethnic ties as a resource for promoting economic cooperation. Ethnic background or family ties do not automatically generate business. When the Yanbian Koreans won the opportunity to visit South Korea, they were surprised at not receiving a warmer welcome there. Indeed, South Koreans tended to look down on them. For political and cultural reasons, North Koreans were held in even lower esteem in South Korea. As Korean-Chinese were often mistaken for North Koreans when visiting South Korea, due to similar dialect and appearance, they often met rather harsh treatment.

As contacts between Korean-Chinese and South Koreans intensified, the differences in their habits and values also became quite clear. Korean-Chinese and South Koreans had drifted apart during forty years of separation. The resulting differences led to conflicts over values and other misunderstandings between the two groups….

Some Chinese government officials also wanted to avoid the problems which contacts with South Koreans might create. This, especially, seems to have hindered cadres of Korean origin. Due to the strong South Korean connection with Yanbian, and the pan-nationalistic activities aimed at creating a united Great Korea, including Yanbian, Yanbian was classified as one of the four sensitive regions in China where the Central Government fears separatism. The fear is that pan-nationalistic South Koreans might infiltrate Yanbian in the guise of economic cooperation. Some officials, who wished to render their career secure by avoiding all trouble, chose to block cooperation with South Koreans and other foreigners….

In addition to political ideas, religious activities spread through transnational ties. Christianity was not only perceived by the Chinese leadership as a threat to the “Chineseness” of the Yanbian Korean culture, but Christian congregations were considered to be a disguise for political infiltrators who aimed to disintegrate the country through peaceful means. South Korean missionaries worked not only among Korean-Chinese but also among North Korean migrants and refugees. While in South Korea, many Korean-Chinese encountered Christianity. Until the 1980s, the role of religion had been limited among Korean-Chinese, while in South Korea, one-third of the population were Christians. One contact assumed that the Korean-Chinese migrants were initially attracted to Christianity when they got support from South Korean believers while working under adverse social and economic conditions: Christian organisations provided practical help, like free medical treatment, as well as social and political support. Christian organisations also won support by backing Korean-Chinese demands that South Korean authorities guarantee humane treatment.

Korean churches worked among Korean-Chinese actively not only in South Korea but also in China. They sent both money and personnel to local churches and ran welfare projects. Some churches had established congregations in Yanbian and other areas of China. Many returning migrants joined a local Christian congregation. By the year 1996, the Christian community in Yanbian had grown to include nearly 10 percent of the ethnic Korean population. In addition to return migrants, these congregations also appealed to locals who looked for support in the midst of deteriorating socio-economic conditions.

In order to counteract foreign political and religious infiltrators, three measures were taken in Yanbian in the late 1990s. Firstly, education emphasizing patriotism, socialism and religious policy was intensified. Secondly, leadership was strengthened. Thirdly, control of foreign religious activities was intensified.

via Frog in a Well

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Filed under China, economics, Japan, Korea, religion

by | 9 February 2007 · 5:52 pm

The Iron Rooster Reaches Lhasa

The AEI‘s online magazine American.com reports that one can now ride the iron rooster all the way from the Forbidden City to the Potala and back.

The extraordinary technological challenges to building a rail line from scratch in Tibet are consid­erably easier to overcome, especially for a powerful centralized regime like China’s, than the legal and political challenges to improving a key rail connec­tion (like Boston–Washington) in the world’s most advanced economy. Also, at this point in history, the Chinese clearly value public infrastructure more than Americans.

The new western railroad creates a bittersweet reality. It will transform Tibet from a thinly populated nation with a largely nomadic population and exotic, remote tourist destinations into a more common and accessible place. For many Tibetans, especially adaptable youth, opportunities will multiply; the loss of a unique history will seem less troublesome to them than it is to the isolated, older population.

The Lamaist State of Tibet is already a memory. Chinese soldiers invaded in 1950, and Tibet became part of the PRC a year later. After an unsuccess­ful rebellion, the Dalai Lama went into exile in India in 1959, and it is clear that the Chinese will not tolerate the re-emergence of a the­ocracy—especially since the government has endowed the west with so much strategic impor­tance. In 1979, Deng Xiaoping declared that China should get on with development. “I don’t care,” Deng said, “whether the cat is black or white, as long as it can catch mice.”

Whether Tibetans will fare better under the Chinese government than they did under the Lamaist theocracy remains to be seen. The outlook for traditionalists is bleak, but for most Tibetans, the chances for a better future are enhanced by the construction of the rail line to Lhasa.

via RealClearPolitics

The author of the article takes the opportunity to bash the U.S. government for not investing enough in physical infrastructure, while lauding the PRC government for doing so. I suspect few Chinese citizens who live far from the coastal cities would share that view. They would likely be thrilled to have the equivalent of the Eisenhower Interstate Highway System instead.

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by | 28 January 2007 · 7:47 am

Sending Cash Home to Eastern Europe, Central Asia

Many newly liberated/orphaned economies of Eastern Europe and Central Asia are now depending more and more on remittances from their citizens working abroad, like so many Pacific Island countries whose economies are based on MIRAB (PDF): MIgration, Remittances, Aid, and Bureacracy.

The largest amount of remittances, as a share of GDP, was sent to Moldova.

The study, using data from 2004, indicated that money sent there by migrants was equivalent to 27% of GDP, an estimated 705 million US dollars. Bosnia and Herzegovina (21%; $1.83bn), Albania (16%; $1.16bn) and Armenia (9%; $336m) were among the larger recipients.

Russia attracted migrants from other parts of the former Soviet Union, while poorer Central Asian workers were drawn to countries such as resource-rich Kazakhstan….

About 80% of Bulgarians and 62% of Romanians said they were not sending cash back to their home countries while working abroad….

While the report focused on the ECA nations, the Bank said that Tonga was the nation which had the largest level of remittance income as a proportion of GDP.

In pure monetary value, the latest World Bank figures show that India was the largest recipient of remittances, with about 22 billion US dollars being sent home in 2005. China and Mexico were also at the top end of the table.

In that year, total remittances globally topped 230 billion US dollars of which developing countries received 167 billion, more than twice the level of development aid from all sources.

via Colby Cosh

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Filed under Central Asia, Eastern Europe, economics

by | 14 September 2006 · 9:12 pm

Origins of Sharecropping in Mississippi

THE DELTA had always been too wild for one man or one family to subdue, and from the first, settlers had brought slaves and organization with them. Immediately after the Civil War, Mississippi and other southern states tried to resolve labor and racial questions by passing a “Black Code” that effectively reestablished slavery. One Mississippi provision required blacks to sign annual labor contracts or be arrested for vagrancy; the local government would then sell their services to contractors. Congress reacted to such laws with anger and instituted “Radical Reconstruction,” setting up new state governments that threw out those laws and putting a buffer of federal power between southern whites and blacks.

[MS Senator Charles] Percy recognized both the economic problems and the need to accept a new order, and advocated a solution. Planters had land but no cash. Blacks had labor but no land; they also resisted working in gangs under a foreman, which smacked of slavery and overseers. So Percy, who understood both the capital shortage and the importance of making labor content in order to maximize efficiency, advocated sharecropping. One man even credited Percy with inventing the system, and contemporaneous reports in other southern states did attribute the system’s beginnings to Mississippi. Planters supplied land; blacks supplied labor and gained some independence. Profits were theoretically split fifty-fifty (the cropper got more if he had his own mules), making blacks and whites partners and by implication comparable if not equal. However abusive sharecropping later became, because of the system’s implied partnership of white and black, initially whites resisted it while blacks welcomed it.

Sharecropping may have helped alleviate the Delta’s desperate shortage of labor in another way. Planters and their labor agents were scouring the rest of the state and the South recruiting former slaves, promising—and delivering—better pay and treatment than elsewhere. The new system may have helped attract blacks, for in a steady stream they came. From one Mississippi county outside the Delta, a single Delta plantation recruited 500 workers. From Columbus, Mississippi, near the Alabama line, 100 black workers left for the Delta in a single week. From Uniontown, Alabama, 250 blacks boarded a single train, heading for the Delta. From Virginia, the Carolinas, and Georgia as well, thousands of blacks came.

SOURCE: Rising Tide: The Great Mississippi Flood of 1927 and How It Changed America, by John M. Barry (Touchstone, 1998), pp. 102-103 (reviewed here)

My paternal grandfather was a (white) tenant farmer in southeastern Virginia. He sometimes managed the farms of landowning relatives, but never owned a farm himself. Not one of his children remained a farmer.

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by | 19 April 2006 · 8:34 pm

Model Japanese Entrepreneur in Cambodia

The Asahi Shimbun carried a story on 19 April about a model Japanese business entrepreneur in Cambodia.

SIEM REAP, Cambodia–Two years ago, a savvy Japanese tour guide saw her chance to fill a business niche here.

Sachiko Kojima opened a cookie factory. She was soon supplying foreign tourists from Japan and around the globe with souvenir confections from this northern Cambodia city, the gateway to the Angkor Wat Khmer ruins.

Her “Madam Sachiko” cookies, shaped like the ancient ruins, are now the must-buy souvenir for tourists visiting the city.

Kojima, 33, who grew up in Gunma Prefecture, runs her business with Japanese management finesse. But her company, Khmer Angkor Foods Co., procures all its ingredients from Cambodian suppliers. The factory includes a bakery, sales shop and head office….

In the shop and bakery, Kojima follows a Japanese business style. The shop’s interior is attractive and inviting. The factory is clean and sanitary. Her employees follow rules similar to workers in Japan: No sitting down and no eating or drinking while on duty in the shop.

Foreigners in Cambodia rarely start businesses outside of travel agencies and restaurants. Kojima had the choice of starting up as a non-governmental organization (NGO), which would have received tax breaks and other advantages.

However, she was determined to form a privately owned, for-profit company.

“I think the people here need to see examples of basic business ideas, such as how to make a profit and how to pay taxes,” she said.

via Colby Cosh

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