Category Archives: labor

Napoleonic War Surplus in Venezuela

From Bolivar: American Liberator, by Marie Arana (Simon & Schuster, 2013), Kindle pp. 216-217, 220:

THE ORINOCO WAS BUSTLING with outsiders. Admiral Brion, who was living in one of the lavish mansions on the waterfront, was overseeing a veritable whirl of activity along the river. … War supplies, too, were suddenly becoming plentiful. In June, a British ship delivered clothing and supplies for ten thousand men; days later, Brion himself brought in a valuable cargo of arms. By the end of July, a large ship had sailed in from London, followed by a brig from New York, bearing enough muskets, pistols, gunpowder, swords, and saddles to outfit an entire army. Bolívar purchased any and all such supplies, paying for them however he could—with mules, fruit, tobacco, livestock. “Arms have been my constant concern,” Bolívar had written to Luis López Méndez, his agent in London, but now they were flowing to him in abundance. So much so that at times there was no need for the equipment. One shipment arrived with fine leather saddles for Páez’s cavalry—saddles his wild horsemen would never use. The remnants of Wellington’s war with Napoleon, nevertheless, were beginning to put Bolívar’s troops at striking advantage. Within a few months, he had stored away fifty thousand stands of arms.

Wellington’s victory had provided something else to the republic: regiments of seasoned war veterans. As irony would have it, British soldiers who had fought alongside General Morillo’s officers in Spain were now enlisting to fight against them in Venezuela. The two years that followed the Battle of Waterloo saw a vast reduction in the size of the British army. In April of 1817, the London Times reported that half a million ex-soldiers were coming home to Britain’s greater population of 25 million. In good times, this would have been difficult enough; but these were not good times—England and Ireland had suffered famine, riots, rampant unemployment—and soldiers were returning to almost certain poverty. When Bolívar’s London agent López Méndez announced he wanted to recruit experienced soldiers to fight in the revolution, he found himself flooded with applicants.

Bolívar … allowed any of the foreigners appalled by the conditions of his post to leave without reprisals or recriminations. The ones who remained would prove to be an invaluable infusion of grit and dedication. Within a month, he would be sending for more. Within five years, fifty-three ships would bring more than six thousand volunteers from Britain and Ireland to serve in South America; 5,300 actually arrived. The ones who made it up the Orinoco to the plains quickly learned that making war in that faraway terrain was no easy way to earn money. Their contributions made a great difference to the revolution in that precise moment in history. Bolívar was convinced of it. He was known to say that the real Liberator of Spanish America was his recruiting agent in London, Luis López Méndez.

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Home Country Hegemony in Spain’s Colonies

From Bolivar: American Liberator, by Marie Arana (Simon & Schuster, 2013), Kindle pp. 18-20:

AS DON JUAN VICENTE [Bolivar, Simon’s father] SETTLED into his new life, he began to be alarmed by Spain’s dominion over it. For fifty years he had been a loyal subject of the king, a trusted judge, governor, and military commander, but by 1776, just as the British colonies declared their independence, Don Juan, too, was dreaming of insurrection. He had good reason to. Spain’s Bourbon regime, which had high ambitions, had decided to impose a strict rule over its colonies. It put into place a number of anti-Creole laws that had a direct effect on Don Juan Vicente’s businesses. First, Venezuela was separated from the viceroyalty of New Granada, a sprawling region that originally reached from the Pacific to the Atlantic over the northern territories of South America; next, an intendant was installed in Caracas to administer economic affairs, and a captain-general to rule over political and military matters. With a direct umbilical to Madrid now, Venezuela began to suffer tighter restrictions on its ranches, mines, and plantations. The Council of the Indies, which governed the Americas from Madrid and Seville, strengthened its hold. Taxes were increased. A ubiquitous imperial presence was felt in all transactions. The Guipuzcoana Company, a powerful Basque corporation that monopolized imports and exports, was reaping great profits on every sale.

If Don Juan Vicente feared the impact of these new regulations, he saw that the blow would be more than financial. Creoles were being squeezed out of government roles. Throughout the Spanish Americas, from California to Buenos Aires, Spain began appointing only peninsulares—those born in Spain or the Canary Islands—to offices that decided important affairs. This was a sweeping, ultimately radicalizing change, reversing a culture of trust between Creoles and Spaniards that had been nurtured for more than two hundred years. In Italy, an exiled Peruvian Jesuit priest, Juan Pablo Viscardo y Guzmán, wrote angrily that it was tantamount to declaring Americans “incapable of filling, even in our own countries, places which, in the strictest right, belong to us.”

The most infuriating aspect of this for Creoles such as Don Juan Vicente was that the peninsulares being assigned the highest positions were often inferior in education and pedigree. This was similar to a sentiment held for years in British America. Both George Washington and Benjamin Franklin had registered strong objections to preferences given to British-born subjects when it was clear that the American-born were far more skilled. In the Spanish colonies, the new emissaries of the crown were largely members of Spain’s middle class: merchants or midlevel functionaries with little sophistication. As they took over the most coveted seats of power, their inadequacies were not lost on Creoles who now had to step aside. In Spain, not everyone was blind to the implications. A Bourbon minister mused that colonial subjects in the Indies might have learned to live without freedoms, but once they acquired them as a right, they weren’t going to stand by idly as they were taken away. Whether or not the court in Madrid understood the ramifications, Spain had drawn a line in the sand. Its colonial strategy shifted from consensus to confrontation, from collaboration to coercion; and to ensure its grip on the enormous wealth that America represented, it put a firm clamp on its laws.

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Japan’s Home Front, 1941

From Storm Clouds over the Pacific, 1931–1941, by Peter Harmsen (War in the Far East, Book 1;  Casemate, 2018), Kindle pp. 253-256:

What kind of nation was Japan in 1941? Who were the 73 million people that would soon find themselves in the most devastating war in their island nation’s long history? Foreign affairs writer Henry C. Wolfe visited Tokyo in the fall of 1941 and was shocked by the gloom and dreariness of life in the once vibrant city of 6.5 million inhabitants. Four years of war and accompanying austerity had turned it into a “capital of shadows” with long lines of customers waiting in front of stores selling low-quality products made from ersatz material. Shoes of real leather could not be found. Clothes were made from a little cotton mixed with bark and wood pulp and ripped easily. Wolfe described what happened when an American diner at a restaurant asked for a second helping of pudding, the only part of his meal that was somewhat palatable. The head waiter replied, “Do you want me to go to jail!”

Wartime regulations had started out in a small way. Local governments had introduced rationing of sugar and matches in 1939, and it had become a national policy in 1940. Since then official controls had exploded, and by the fall of 1941 more than 100,000 goods and services were being regulated. Energy shortages were particularly conspicuous. Many vehicles were converted to run on charcoal, although that fuel was also in short supply. Police were soon forced to stop all public vehicles from running between midnight and 5 am. Adding to the woes, trams and trains were overloaded with people, since cars that had broken down could not be repaired due to a lack of spare parts.

The American trade curbs worsened an already steep decline in the standard of living, but they did not cause it. The tougher conditions faced by the average Japanese were equally due to the priorities of the Japanese rulers, which allocated ever larger resources to military purposes, leaving the civilians to pay. The war in China had taken its toll. In 1931, military expenditures had taken up 31.2 percent of the government budget, but a decade later it had increased to a staggering 75.6 percent. Average wages dropped by more than 20 percent from the mid-1930s until 1941. Meanwhile, there was less and less to be had for the shrinking incomes. The light industrial sector, where consumer products were manufactured, saw its share of overall production drop precipitously over the same period.

The finer things in life were, of course, virtually non-existent. Dance halls had been prohibited, despite their immense popularity, along with most jazz performances. Foreign movies were strictly limited, and Japanese cinemagoers, who were once among the most ardent foreign fans of Hollywood and even copied manners and slang from major American releases, were now limited to grim German propaganda fare with titles such as Victory in the West. The lights were out, also, in a quite literal sense. In Tokyo’s Ginza shopping district, the famous glittering neon signs had been turned off to save electricity. Five-star hotels, too, were wrapped in gloom after they were urged to keep lighting at a minimum.

Miyamoto Takenosuke, vice director of Planning Board, argued that “the people should be satisfied with the lowest standard of living.” He went on: “The craving for a life of luxury must be abandoned. At this time, when the nation is risking its fate, there is no individual any more. What remains is the nation and the nation alone. The storm of economic warfare will become more furious. Come rain! Blow wind! We are firmly determined to fight against the storm.” Japan’s largest candy maker Meijing [sic] Confectionary Company chimed in with an ad campaign featuring the slogan “Luxury is the Enemy!” The National Defense Women’s Association also did its part in imposing wartime rigor, posting members on street corners to stop women who were dressed too extravagantly, passing them handbills with stern admonitions about the need for thrift in light of the national emergency.

At the same time, a thriving black market for regulated goods had emerged almost immediately, and a special economic police set up to rein in the activities made more than two million arrests within just 15 months. The vigorous law enforcement did not curb the illegal transactions, but simply encouraged them to be carried out in more ingenious ways. A modern historian gives an example of how it remained possible to trade coal at the black-market price of 1300 yen, well above the official 1000 yen price tag: “To secure the additional 300-yen profit without running afoul of the law, a vendor, for example, might arrange for a customer to ‘accidentally’ drop 3000 yen next to the vendor’s stall. He would then take the money to the nearest official who would instruct the buyer to pay ten percent in thank-you money (300 yen) to the vendor.”

Despite the hardship, the Japanese government pretended it was in a position not only to care for its own population but for the peoples of all Asia.

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Kalakaua Visits Meiji, 1881

From Emperor of Japan: Meiji and His World, 1852–1912, by Donald Keene (Columbia U. Press, 2005), Kindle pp. 346-347:

On February 23 the emperor had word from John Bingham, the American minister, that King Kalakaua of Hawaii would be arriving in Japan on a round-the-world journey. The king would be traveling incognito, but he had some state business to transact: he wished to encourage Japanese migration to Hawaii and to sign a treaty with the Japanese government. He was accordingly treated as a state visitor, and Prince Yoshiaki was appointed as the commissioner for the visit. Two other officials were charged with entertaining the king.

Kalakaua arrived in Yokohama on March 4. He was greeted with twenty-one-gun salutes by Japanese and foreign warships anchored in the bay. When the boat sent by the Japanese to take the Hawaiians from the Oceanic to their hotel touched shore, they heard the Hawaiian national anthem, played with explosive vigor by a Japanese military band. They were astonished that the Japanese musicians had learned the anthem of so remote and unimportant a country. The king and the others of his retinue, touched, were all but in tears. Along the way to the palace where they were to stay, they noticed that the houses of Yokohama were decorated with crossed Japanese and Hawaiian flags. The king and his party were stunned by the welcome.

Kalakaua traveled to Tōkyō the next day aboard the imperial train and, after receiving an official reception at Shimbashi Station, proceeded directly to the Akasaka Palace. The emperor, following the etiquette of European courts that requires a monarch to receive a visiting monarch at the threshold of his palace, went to a room close to the entrance of the palace to meet his royal visitor. He was resplendent in a dress uniform studded with medals. The two monarchs shook hands. The Hawaiians, having been informed that the emperor normally did not shake hands, interpreted the gesture as a special honor. The two monarchs, after exchanging formal greetings, walked side by side into an interior room. W. N. Armstrong, the king’s chamberlain and the chronicler of his journey around the world, had heard that because of his divine origin, the emperor had never before permitted anyone to walk by his side; even the empress followed him. “But, for the first time in his own reign, and in those of his predecessors, he walked by the side of his kingly guest.”

The empress was waiting for the royal visitor in the audience chamber. Meiji presented Kalakaua to the empress. “She did not rise, but returned the king’s salutation with the least movement of her head and eyes.” Sueko, the daughter of Inoue Kaoru, who had spent several years in England, served as her interpreter. (Armstrong wrote that she spoke perfect English.) Refreshments were served, but the Hawaiians, having been previously informed that they should not eat in the presence of the emperor, declined them.

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Tibetan Wealth in Caterpillar Fungus

From Eat the Buddha: Life and Death in a Tibetan Town, by Barbara Demick (Random House, 2020), Kindle pp. 100-101:

Tibetans also discovered a niche that was almost uniquely their own: collecting medicinal herbs. Herbs were commonly used in both Chinese and Tibetan medicine, and many of the more valuable were found on the Tibetan plateau. Beimu, an alpine lily used to treat coughs, grew at altitudes of more than 10,000 feet, and Tibetan nomads were perfectly situated to collect it.

Most lucrative was Cordyceps sinensis, a prized ingredient in traditional medicine, believed to boost immunity, stamina, and lung and kidney function. Tibetans call it yartsa gunbu, meaning “summer grass, winter worm,” or simply bu, “worm,” for short. [In Chinese, it’s 冬虫夏草 dōng chóng xià cao ‘winter worm, summer grass’.] The worm is actually a fungus that feeds on the larvae of caterpillars. In the past, the worm was commonplace enough that Tibetans would feed it to a sluggish horse or yak, but the Chinese developed a hankering for it that sent prices soaring. Chinese coaches with gold-medal ambitions would feed it to athletes; aging businessmen would eat it to enhance their sexual potency. At one point, the best-quality caterpillar fungus was worth nearly the price of gold, as much as $900 an ounce.

Tibetans had a natural monopoly on the caterpillar fungus. Non-Tibetans didn’t have the local knowledge or the lung capacity to compete. The best worm was in Golok, northwest of Ngaba. Nomadic families would bring their children with them, sometimes taking them out of school because their sharp eyesight and short stature allowed them to more easily scan the ground for the worm amid the grasses and weeds. The season ran for approximately forty days of early spring, the time when the melting snow turned the still-brown hills into a spongy carpet. The families would camp out for weeks in the mountains. In a good season, a Tibetan family could make more in this period than a Chinese factory worker could earn in a year.

The Communist Party would later brag about how their policies had boosted the Tibetan economy, but the truth was that nothing contributed as much as the caterpillar fungus, which according to one scholar accounted for as much as 40 percent of Tibetans’ cash earnings. Unlike earnings from mining and forestry, industries that came to be dominated by Chinese companies, this was cash that went directly into the pockets of Tibetans. The nomads acquired the spending power to support the new shops and cafés. The golden worm was part of a cycle of rising prosperity.

Until the 1980s, trade between the Tibetan plateau and southern China had gone only in one direction. Tibetans were eager customers for the newfangled electronics and ready-to-wear clothing stamped out by China’s new factories, but Han Chinese didn’t have much taste for Tibetan products like dairy and lamb. The medicinal herbs gave the itinerant traders something to put in their suitcases when they went on shopping trips to Shenzhen and other southern Chinese cities.

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Tibetans Take the Great Leap Forward

From Eat the Buddha: Life and Death in a Tibetan Town, by Barbara Demick (Random House, 2020), Kindle pp. 43-45:

The Communist Party had identified feudalism and imperialism as the greatest evils of society. Their dilemma was how to destroy feudalism without becoming imperialists themselves; they couldn’t simply force “reforms” on the Tibetans. In order to live up to their own lofty propaganda, they needed the Tibetans to carry out reforms voluntarily, joyfully. To convince them, they dispatched young Chinese recruits, some of them still in high school, to spread the word. These young Chinese cadres lectured about the corruption of the aristocracy and the monasteries, which also had large holdings of land. Delek remembers their speeches.

“You will be your own master,” the Chinese promised poorer Tibetans. “We will topple the feudal landlords.”

“Nobody will be able to exploit you anymore.”

“Religion is superstition. You are worshipping demons.”

The mass uprising never materialized. But the pitch did appeal to those Tibetans who hoped the redistribution of wealth would improve their lot in life. Tibetans who joined forces with the Communist Party were known as jiji fenzi, which loosely translates from Chinese as “activists.” The Tibetan term was hurtsonchen—the lowest level of enforcers, the collaborators who squealed on and beat up neighbors who resisted Communist rule. As a reward, hurtsonchen were allowed to loot clothing, shoes, and household goods from their wealthier countrymen. But anything of real value went to the Party-controlled communes, which turned out to be far greedier than the worst of the feudal landlords. Tibetans of this generation refer to this period simply as ngabgay—’58. Like 9/11, it is shorthand for a catastrophe so overwhelming that words cannot express it, only the number. But there are some evocative figures of speech. Some will call it dhulok, a word that roughly translates as the “collapse of time,” or, hauntingly, “when the sky and earth changed places.”

The “Democratic Reforms” in eastern Tibet roughly coincided with the Great Leap Forward, Mao’s misguided experiment in jump-starting the Chinese economy. Like so many catastrophes, it was the result of ambition run amok. Mao was a utopian who hoped to create not just a new society, but new, improved human beings. He believed that people could transcend their individual desires for the greater good and through collective enterprise boost their living standards and the country’s output. This was to be accomplished by herding 700 million people into cooperative farms.

Even to a child as young as Delek, it was obvious that Mao’s reforms were doomed to failure. The Chinese cadres in charge of the Tibetans had no experience with herding and even less with farming at high altitudes. Most of the Chinese troops came from lower-lying regions; they didn’t realize that barley was the only grain that thrived in the plateau and that the higher altitudes couldn’t support crops at all and were better used for grazing. Giddy from Mao’s exhortations, they denied the expertise of the people who had lived off the land for generations, insisting that the Tibetans were backward. “As the Han are the bulwark of the revolution…any thinking against learning from the Han nationality and welcoming the help given by the Han nationality is completely wrong,” expounded one propagandist at the time. The nomads were made to hand over animals to the collectives that didn’t know how to keep them alive, and to farm land that would never produce crops.

The result was years of failed harvests and dead animals. Grasslands where the crops failed were now stripped bare of vegetation, exposed to the winds that swirled through the plateau spewing dust into the air. The Communist cadres didn’t understand that the Tibetan way of sustenance required both nomads and farmers; in order to obtain enough nutrition, people needed to swap their animal products for grains, and that required markets. Now the markets were closed. Buying or selling grain was forbidden. Internal travel restrictions were imposed so people could no longer barter goods with other villages. When Delek’s mother returned from Lhasa, she would saddle up a horse in the dead of night to visit a cousin in another village with whom she could trade some butter for barley to prevent her family from starving. She only dared make the trip a few times a year.

Unlike Han Chinese, Tibetans had little experience with famine—the exception being the Long March interlude of 1935 and 1936 when the Red Army decimated their food supply. In the past, Tibetans were poor, often poorly nourished because of the scarcity of fresh fruit and vegetables, but they rarely went hungry.

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North Korea’s Caste System

From The Great Successor: The Divinely Perfect Destiny of Brilliant Comrade Kim Jong Un, by Anna Fifield (PublicAffairs, 2019), Kindle pp. 120-123:

Why, then, if so many North Koreans know about the outside world, and know that the regime is lying to them, has the system survived? The answer lies in the unparalleled brutality of the regime, which has no compunction in meting out severe punishments for the smallest hint of disaffection.

To enforce the lie that he’s the best man for the job, Kim Jong Un has perpetuated North Korea’s political caste system with zeal, rewarding those deemed most loyal to him and ruthlessly punishing those who dare question him.

This caste system is another legacy of his grandfather. When he was creating his ideal state, Kim Il Sung borrowed some of the feudal practices of the Chosun Dynasty, which had ruled Korea for five centuries until almost 1900. He adopted the Chosun-era system of guilt by association. It is this system that, even now, can lead to three generations of an entire family being imprisoned, sometimes for life, for one person’s wrongdoing.

He also stole the discriminatory class system called songbun from the Chosun era, dividing North Korea into fifty-one different categories that fall into three broad classes: loyal, wavering, and hostile.

To this day, in Kim Jong Un’s North Korea, the loyal are given every advantage. They are the 10 to 15 percent of the population who are considered the most politically committed to the system and have the most interest in it continuing. They get to live in Pyongyang and receive better schooling, including the possibility of attending Kim II Sung University. They are set up for plum jobs and have a head start on Workers’ Party membership. The loyal caste live in better apartments, wear better clothes, eat better and more food, and are more likely to be able to visit a doctor who actually has medicine.

At the bottom are the hostiles: the Japanese collaborators, the Christians, the skeptics. They comprise about 40 percent of the population and are generally banished to the inhospitable mountains of the north, where winters are unbearable and food is scarce even by North Korean standards.

These “undesirables” have no social mobility and no hope of advancement. Their lives revolve around a collective farm or factory—an assignment that, for the last few decades, has meant fending for themselves.

In between the loyal and the hostile is the wavering class, the ordinary people who make up about half the North Korean population. They exist in a kind of limbo. They have no chance of going to college or having a professional job, but if they’re lucky, they might secure a good assignment during their military service that will help them work their way to a slightly better standard of living.

Someone born with bad songbun has no hope of moving up the social hierarchy. The upper levels, however, can plummet all the way to the bottom if they put a foot wrong. Through this system, and the constant threat of being demoted down the classes, Kim Jong Un has been able to maintain power.

If you’re a member of the loyal class—living in Pyongyang and able to earn some money on the side of your ministry job to send your children to university—you would think twice before openly questioning whether the leader could really drive a car at age five or criticizing the decision to spend millions on nuclear weapons instead of on hospitals and schools. There is always someone to keep an eye on you and report if you’re not sufficiently devoted to the regime. At the grassroots level, it starts with the inminban, literally “people’s group,” a kind of neighborhood watch system. Each neighborhood is broken down into groups of thirty or forty households, with a leader who is always an interfering middle-aged woman. It is her job to keep an eye on what people in her assigned households are up to. North Koreans like to say that the leader of their neighborhood group is supposed to know how many chopsticks and how many spoons each house has.

She is responsible for registering overnight visitors—in North Korea, a person can’t stay at a friend or relative’s house without notifying the authorities—and often, together with the local police, conducts dead-of-night raids to ensure there are no forbidden guests or that residents like Man-bok or Jung-a are not watching South Korean movies. She inspects everyone’s state-issued radio to make sure they haven’t tuned it to anything other than the state station. She checks cell phones to make sure they don’t contain unauthorized music or photos from the outside world.

She also encourages neighbors to report on one another. If a family is thought to be eating white rice and meat suspiciously often, people might wonder how they’re making their money.

North Koreans live in a system where every aspect of their lives is monitored, where every infraction is recorded, where the smallest deviation from the system will result in punishment. It is ubiquitous, and it keeps many people from even raising an eyebrow at the regime. The neighborhood leader needs to report transgressions in order to stay in good stead with the higher authorities, especially the two main security agencies.

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North Korea’s Market Economy

From The Great Successor: The Divinely Perfect Destiny of Brilliant Comrade Kim Jong Un, by Anna Fifield (PublicAffairs, 2019), Kindle pp. 100-101:

Chinese-style reform and opening—allowing information to flow in at the same time as loosening up on the economic controls—was not an option for Kim. Allowing the population to have access to the truth would mean they would also see that the Great Successor was, in fact, not so great. But small economic “improvements”—North Korea doesn’t call them “reforms” because that implies there’s something wrong with the system—pose relatively little risk.

Instead, he allowed the markets, called “jangmadang,” to blossom.

From the smallest of towns to the biggest of cities, there’s at least one bustling marketplace. Across the country, these markets have become the center of daily life. They are overwhelmingly run by women, who, once married, are no longer required to work in state jobs. So while their husbands go off to coal mines without electricity or hospitals without medicine, the women make proper money.

People with permission—or with enough money to buy permission—to travel to China cross the Tumen River and bring back rice cookers, high-heeled shoes, solar panels, deworming tablets, colorful shirts, cell phone cases, and screwdrivers. Sometimes they bring literal kitchen sinks. About 80 percent of the products in North Korea’s markets are made in China.

Those who can’t travel set up shop as hairdressers or bike repairers, open restaurants, or sell homemade sweets. Some entrepreneurial types make money by renting out their cell phones for calls to South Korea or their apartments to couples wanting some privacy.

These markets have become the biggest agent for change that North Korea has ever experienced. People across the country have seen their living standards improve—just as Kim Jong Un promised. Maybe things didn’t improve as much as many citizens, such as Mr. Hong, wanted, but they’re still heading in a positive direction. There is now a middle class in North Korea.

There are now more than four hundred government-approved markets in North Korea, double the number that existed when Kim Jong Un took over the country. The city of Chongjin alone has about twenty. The markets in Sinuiju and the “smugglers’ village” of Hyesan, both close to the border with China, as well as those in the port city of Haeju, have all grown rapidly and visibly in recent years. Satellite images show new markets popping up all over North Korea and old markets moving into bigger, newer buildings.

With an average of fifteen hundred stalls in a market, there is stiff competition to secure a prime spot. A good stall in a prominent place in Hyesan was going for about $700 in 2015—an astronomical sum in North Korea. But there is so much demand for stalls that even these expensive slots are being snapped up as soon as they become available.

At every turn, there is someone seeking to make money from the markets. The security services extract bribes from those seeking to cross the river into China. The supposedly communist authorities have embraced the decidedly capitalist concept of tax. People running stalls in the markets must now pay 10 percent of the value of their sales to the market management office. South Korean researchers estimate that the authorities rake in about $15 million a day in stall rental fees from merchants, while other estimates suggest the state can earn almost a quarter of a million dollars in a single day by levying taxes on stall owners.

Each market is run by a manager, someone who is almost always a man and who is well connected with local bureaucrats. This is a powerful role that comes with the opportunity to make a lot of money—and, of course, an obligation to pay kickbacks to higher-ups who put them in the job.

As the state economy has failed, with industry grinding to a halt thanks to a lack of electricity or raw goods, the markets have become the lifeblood of North Korea.

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Negative Human Development in Resource States

From The Looting Machine: Warlords, Oligarchs, Corporations, Smugglers, and the Theft of Africa’s Wealth, by Tom Burgis (PublicAffairs, 2016), Kindle pp. 211-212:

In 1970, the year the Olympic movement expelled South Africa, the government passed legislation formally stripping blacks of their citizenship and restricting them to destitute “homelands,” and the authorities appointed a barbaric new commanding officer at Robben Island prison to watch over Mandela and his fellow inmates, South Africa produced some 62 percent of the gold mined worldwide. From the early 1970s to 1993 gold, diamonds, and other minerals accounted for between half and two-thirds of South Africa’s exports annually.

South Africa’s gold and diamonds provided the financial means for apartheid to exist. In that sense white rule was an extreme manifestation of the resource state: the harnessing of a national endowment of mineral wealth to ensure the power and prosperity of the few while the rest are cast into penury and impotence. None of Africa’s resource states today come close to the level of orchestrated subjugation of the majority that the apartheid regime achieved. Neither do they employ apartheid’s racial creed, even if ethnicity has combined poisonously with the struggle to capture resource rent in Nigeria, Angola, Guinea, and elsewhere. But as their rulers, in concert with the multinational corporations of the resource industry, horde the fruits of their nations’ oil and minerals, Africa’s resource states have come to bear a troubling resemblance to the divisions of apartheid.

While the children of eastern Congo, northern Nigeria, Guinea, and Niger waste away, the beneficiaries of the looting machine grow fat. Amartya Sen, the Nobel Prize–winning Indian economist who has examined with great insight why mass starvation occurs, writes, “The sense of distance between the ruler and the ruled—between ‘us’ and ‘them’—is a crucial feature of famines.” That same reasoning could be applied to the provision of other basic needs, including clean water and schooling. And rarely is the distance Sen describes as wide as in Africa’s resource states.

Many of Africa’s resource states experienced very high rates of economic growth during the commodity boom of the past decade. The usual measure of average incomes—GDP per head—has risen. But on closer examination such is the concentration of wealth in the hands of the ruling class that that growth has predominantly benefited those who were already rich and powerful, rendering the increase in GDP per head misleading. A more revealing picture comes from a different calculation. Each year the United Nations ranks all the countries for which it can gather sufficient data (186 in 2012) by their level of human development, things like rates of infant mortality and years of schooling. It also ranks them by GDP per head. If you subtract a country’s rank on the human development index from its rank on the GDP per head index, you get an indication of the extent to which economic growth is actually bettering the lot of the average person in that country. In countries that score zero—as Congo, Rwanda, Russia, and Portugal did in 2012—living standards are roughly where you might expect them to be, given that country’s GDP per head. People in countries with positive scores enjoy disproportionately pleasant living conditions relative to income—Cuba, Georgia, and Samoa top the table with scores of 44, 37, and 28, respectively. A negative score indicates a failure to turn national income into longer lives, better health, and more years of education for the population at large. Of the ten countries that come out worst, five are African resource states: Angola (–35), Gabon (–40), South Africa (–42), Botswana (–55), and Equatorial Guinea.

Equatorial Guinea’s score (–97), comfortably the worst in the world, is all the more remarkable because its GDP per head is close to $30,000 a year, not far below the level of Spain or New Zealand and seventy times that of Congo.

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New African Infrastructure for Whom?

From The Looting Machine: Warlords, Oligarchs, Corporations, Smugglers, and the Theft of Africa’s Wealth, by Tom Burgis (PublicAffairs, 2016), Kindle pp. 147-149:

It is too simplistic to see China’s quest for African resources as a Manichean struggle for nature’s treasure between East and West. There is competition, but there is also cooperation in the business of resource extraction. And for all its increased attractiveness to rival investors from overseas, much of Africa remains locked at the foot of the global economy.

Ibrahim Iddi Ango, the industrialist who headed Niger’s chamber of commerce, told me that Niger’s rulers had sold the country short in their negotiations with the Chinese. “They need strategic resources. You must say, ‘You are interested in that? These are the conditions. First, you must use local labor. Second, all the needs you have—for example, the transit—you must use at a minimum 50 percent local operators.’ But when they came the government said none of this. The state took a percentage of the businesses and let the Chinese do what they want.” A brief window of opportunity to use China’s desire for African minerals to insist on securing for Niger the skills and infrastructure that might help to salve the resource curse by broadening the economy was closing. “To diversify, it’s central,” Iddi Ango said—and with good reason. Niger is among the African states most acutely dependent on a handful of raw commodity exports, their economic fortunes yoked to the whims of far-off consumers. On the African Development Bank’s index, where a higher score indicates a more diversified economy, relatively wealthy countries not shackled to the resource trade such as Mauritius and Morocco score 22 and 41, respectively. The average for the whole of Africa, including more prosperous North Africa, is 4.8. The most oil-dependent states, Angola and Chad, record the lowest scores, 1.1. Niger does only marginally better, with a score of 2.4.

“But if you let China do what it wants—as many African countries have—they pay for the oil or the resources and use Chinese labor, Chinese trucks. It’s a big problem,” Iddi Ango said. “They are coming because the resources are here. This moment will not be repeated. We can’t miss it. When the uranium or the oil is finished, they will leave.”

The fall of Tandja demonstrated the limits of China’s readiness to get involved in domestic politics to protect African allies. But Xia Huang, the Chinese ambassador in Niamey, encapsulated how China’s readiness to spend and build allowed Beijing to gain a foothold sufficiently strong that its interests could withstand a coup against an ally. “Today there is a bridge between the two sides of the River Niger,” he told me. “But there is also a bridge that links China and Niger.”

Yet the true value of China’s offer to guide Africa on a path to economic diversification and industrialization—the road that led the rich world to prosperity—rests on whether its construction spree is geared primarily toward cultivating the rulers who govern access to resources or toward broadening the opportunities of the population at large. Neither railways that simply connect Chinese-owned mines to Chinese-built ports for the export of commodities nor vanity projects of great cost but little economic usefulness will lift resource states’ inhabitants from their poverty. Martyn Davies, the chief executive of a South African consultancy called Frontier Advisory who has worked as an adviser on Chinese deals in Africa, told me, “When you have a commodity-driven economy, where a lot of people are excluded, it’s a silo economy. It’s very difficult to build infrastructure that supports inclusive growth. Is Chinese-financed infrastructure going to provide diversification? Which comes first?” He added, “African governments should never assume that responsibility for the development of our continent has been outsourced to Beijing.”

Beijing appears to be undercutting its side of the deal. Chinese goods like the counterfeit textiles flooding into northern Nigeria drown out hopes for industrialization, regardless of how many roads and railways Chinese companies lay. Lamido Sanusi, governor of Nigeria’s central bank from 2009 to 2014, put it well: “So China takes our primary goods and sells us manufactured ones. This was also the essence of colonialism. The British went to Africa and India to secure raw materials and markets. Africa is now willingly opening itself up to a new form of imperialism.”

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Filed under Africa, China, economics, industry, labor, Niger