Burmese days*

Santa took a holiday in Burma this year.  It’s become the trendy place to visit for the middle classes now that the military regime has opened, freed the democratic opposition leaders and allowed (on the whole) freedom of speech etc – although there are still political prisoners and the army is conducting wars against ethnic groups in the north and muslim terrorists in the south.  Tourists are now beginning to flood in, one million this year, to look at thousands of pagodas, Buddhist monks and temples.  But I have to say, if you’ve seen one pagoda, you seen nearly all of them.  So let me look at Burma from an economic viewpoint in this post.

Burma is still a predominantly rural economy, with 70% of the population on the land and 60% employed there.  And agriculture is still the largest contributor to GDP at 36%, compared to industry and services.  These ratios are way higher than anywhere else in Asia or most of the rest of the world.  It shows that Burma is one of the most backward and ‘undeveloped’ economies, and certainly the most undeveloped with such a large population – now about 60m.  And it’s the second largest country in south-east Asia by area.

The countryside is dotted with paddy fields in the south and sugar cane and even wheat fields in the north.  The teak forests have been badly erased by excessive logging, but it remains a major export.  And now there is oil and gas potential with proven reserves of 7.8trn cubic feet, sufficient to allow natural gas exports.  But Burma remains the poorest country in Asia, cut off as it has been from international trade and investment because of the partly deliberate isolation of the military regime that ruled the country from 1962.

The countryside reveals millions toiling in the field under temperatures of 40C, while slightly more fortunate others work a 12 hour day, six day week in rural factories to make tourist garments and trinkets.  And millions of others scrape a living in the dusty, polluted cities of Yangon and Mandalay.  The dysfunctional nature of the economy is summed up by the sight of Burmese taxi drivers with cars that have the driving wheel on the right hand side while traffic also drives on the right, not the left!  Only the very latest Japanese imports (now allowed) have left side wheels.

The military has crushed various protests and opposition movements over the years, culminating in the arrest of long-time opposition leader and Nobel peace prize holder Aung San Suu Kyi (called ‘the Lady’) after the opposition won a landslide election victory in 1990.  But this did not stop further revolts and the military finally decided that they needed to ‘open up’.  In 2010, Thein Sein, one of the generals, renounced his military role and became the first civilian president in 2011 after rigged elections.  However, he then freed The Lady from house arrest and she and the opposition leaders agreed to walk ‘hand in hand’ with the president until free elections are called in 2015.

Since then, the major capitalist powers have started to open up their embassies and renew trade with and investment in Burma.  Hilary Clinton and President Obama have visited with much fanfare.  And Aung Sang visited Europe, to much acclaim.  Burma is back on the imperialist map.  For a view on the motivations of US leaders on Burma, have a look at Richard Mellor’s blog, Facts for working people (http://weknowwhatsup.blogspot.com/2011/12/hillary-clinton-in-myanmar-nice-place.html).

Of course, this ‘opening up’ is really the start of capitalist development through a partnership between the generals and the opposition National League for Democracy (NLD) to form a pro-capitalist government that will negotiate terms with international agencies and multi-nationals to ‘develop’ Burma.  Already, a new foreign investment law has been passed allowing multi-nationals to start up businesses without a Burmese partner.  The president summed up the strategy of the military: “Our reforms are irreversible,” he promised. “Our goal is still to build a multi-party democratic system and a market economy.”

Will this ‘partnership’ succeed in taking Burma out poverty and backwardness, where the majority earn no more than $4 a day and roads, power and infrastructure are in a state of decaying decrepitude?  Well, the Burmese people (like the Vietnamese and others in Asia) are very hard working.  And they also have the advantage of English speaking (unlike China or Vietnam) from their days under the British raj.  But this is a small advantage given that most Asian countries have dramatically expanded their education in English, with a growing middle class that can fill skilled jobs, unlike Burma.

In some ways Burma leans more to India to the west, at least culturally, than to the ASEAN states to the south, although Burma is a member of ASEAN.  There is longstanding antagonism between Burma and its neighbour, Thailand.  Burmese TV has Indian, Malaysian and Indonesian channels but not Thai.  Even so, the model for growth will probably be that of Thailand, Singapore, Malaysia and Vietnam, and not India.  That means growth through exports and fixed investment and not through consumer-led domestic demand and government spending as in India.  A problem remains:  the most productive parts of the economy are in the hands of the military and their families through the state-owned companies, Chinese style.  But that is a problem for capitalist development that can be circumvented as it has been in China and Vietnam, at least for a while.

And between the vast rural poverty of the paddy fields and the military control of the key industries, there are gaps for capitalist development in retailing and wholesaling.  Budding entrepreneurs are springing up.  These Burmese are the sons of the rich and military, educated abroad and now coming back to make a fortune.  They are funded by their families to build empires in domestic industries like pharma, hi-tech, electronics, mobiles etc (see the recent FT report of 21 december 2012).  Here is the start of a rising national capitalist class that, in the words of one, has “little emotional attachment to politics – we are here to do business… many of us basically support any government that will help business”.

The British relinquished colonial power after over one hundred years of rule in 1948 to a democratic government after the ravages of the second world war.  But independent government was soon riven apart by regional and tribal schisms and imperialist machinations.  The democratic leaders were assassinated and a military that had been trained by the British and the Japanese then seized power.  This military caste looked to the Chinese under Mao as their model for development but soon descended into Cambodian Pol Pot-style nationalist isolation.  It locked up or killed any opposition, it conducted vicious repression of the many minority ethnic groups in the country and it imposed forced labour to carry out constructions (just stopping short of the worst genocidal excesses of the Pol Pot regime).

The generals nationalised all the key industries and forests.  But their rule was a million miles from the ‘socialism’ they claimed to support.  The generals under Ne Win ruled more through Asian oracles and magic, than by the tenets of socialist planning.  For example, they decided to build a new capital because an oracle said they should and they issued a 45 kyat note instead of a 50 because any multiple of the number nine is lucky!  In 1992, they began to drop their ‘socialist’ creed as the generals and their families looked to secure their wealth through building family dynasties over industry and resources, just as China’s ‘princelings’.

The current generation of military leaders seems to have accepted that they cannot survive through direct control of the economy and political institutions.  So they have opted for Plan B, where Turkish-style, they stay in the background allowing a pro-capitalist democratic party to assume office from 2015, in return for which the military get to keep their wealth and privileges and some of their power as the final arbiters of Burma’s destiny.  They won’t be able to sustain this compromise indefinitely as the military in Turkey and Egypt have found recently.  The Turkish generals have been crippled by their capitalist class that now feels strong enough to restore direct control without fear of a coup because they are backed by working-class muslims.  In Egypt, the battle between the military and the people has only just begun.  The Muslim Brothers hope that they can do the same as Turkey’s Islamist party.

A truly democratic Burma where the wealth and value of the toil of its people are controlled by the people and distributed fairly is still a long way off.  And it is not the intention of any of the major players: the military, the opposition and the ‘international community’ to allow it.   Sustained democracy will depend on how long the temporary compromise between the military and the pro-capitalist democratic opposition can hold.  And it will depend on the vagaries of the world economy and ability of Burma’s small working class to develop an independent voice from the middle-class leaders of the NLD.  In turn, that depends on much stronger working class organisation to resist the march of capitalism as Burma comes under the tentacles of globalisation.

*Burmese Days by George Orwell: “It is a world in which every word and every thought is censored… even friendship can hardly exist when man is a cog in the wheels of despotism.  Free speech is unthinkable.”  Orwell’s character John Flory on Burma in the 1920s under British rule.


6 Responses to “Burmese days*”

  1. Alright Jack Says:

    “The dysfunctional nature of the economy is summed up by the sight of Burmese taxi drivers with cars that have the driving wheel on the right hand side while traffic also drives on the right, not the left! Only the very latest Japanese imports (now allowed) have left side wheels.”

    The cars used to write on the left side (British colony etc), one of the theories behind the change is that one of the generals had a dream that made him change the law from one day to the other. But it’s a fascinating sight indeed, all those rusty white Toyota Corolla’s driving on the wrong side of the road.

    One of the slightly hopeful things from Aung San Suu Kyi is that in interviews she’s not at all excited about the changes that are going on and that she does not want Burma to become like Thailand with its extreme inequality, but much more like South Korea.

  2. John Says:

    Another fantastic post. It’s great to hear you visited Burma, Michael! I did as well last spring. It is the land of a million pagodas and I agree that once you’ve seen one, you’ve seen them all. But I did think it was the most fascinating place I have ever been to for a variety of reasons, many of which come down to the fact that it’s probably the world’s most isolated country other than North Korea (most of the country is off-limits to tourists, although I was able to sneak outside the boundaries). Going to Mandalay is like stepping in a time machine.

    I am a bit pessimistic though about the possibilities of working-class organization in the future. Socialism has gotten a bad name from the military generals and Kyi’s story has made her incredibly popular (the Burmese people seem very willing to believe in whatever she has to say about political/economic policy that they don’t understand). The other reason is very unique to Burma: the religious devotion of its populace. I’ll never forget the answer a Burmese taxi driver gave to us when we asked him about what he thought about Kyi and the NLD. It was something along the lines of ‘those are matters of the material world that we should not be too concerned with. What matters is living a good life so that we may come closer to Enlightenment in the lives that come.’ Burma is possibly the most religiously devout country I have ever been to. We took a bus with mostly local passengers but one of the tourists on it left a smartphone on it. He realized his mistake hours later and was able to track it down. None of the passengers took it and the people working on the bus kept it for him. This kind of behavior is unheard of even in wealthy countries.

    Buddhism is one religion that is not too encouraging of social justice for a variety of reasons: because of its emphasis on spiritual as opposed to material matters, its belief in reincarnation, and its acceptance of suffering as being the most absolute fact in life, among other things. I usually am the last to admit that cultural factors could be so salient but I wonder if it could be truly relevant in a country that has been so isolated from the outside world. But I will say that I admired the man’s response and despite my own Marxist persuasions, sometimes I feel that both left and right are too devoted to the Enlightenment tradition and are unable to grasp that ‘spiritual’ well-being may be more important than the comforts that the material world can provide.

  3. Charles Says:

    John: “A tourist left a smartphone on the bus. None of the passengers took it and the people working on the bus kept it for him.”

    Many stories like this came out of China before Deng Xiaoping dismantled socialism. For example, a woman I knew forgot a pair socks in a hotel. The staff washed the pair and forwarded it to her next hotel on the other side of the country.

    • John Says:

      Stories like these prove that desire for material goods is not as much of an intrinsic part of human nature that classical liberals like to believe. We have been brought up in a society that values the accumulation of wealth, consumption, and material belongings, so desiring them seems ‘natural’ and ‘instinctive’ to us. But people who hold different value systems view these things completely differently than we do (Weber’s story of the peasants who worked half as hard once they got paid twice as much for their grain harvest is a classic example of this). It only makes me wonder if someone brought up in a culture that doesn’t value social justice, material comforts and possessions, or even the material world will be much less likely to be interested in politics or participate in revolutionary movements.

      This might be quite tangential but I think a good example of this would the issue of health and obesity in the US. Liberals are much more concerned with combating the obesity epidemic and seem to value health more than conservatives. Coming from an Enlightenment framework, it should be assumed that people would make the decision to be healthy. It is, after all, a simple, rational decision that leads to an obviously positive outcome (living longer). Social conservatism in the US is heavily influenced by Christianity, however, and from a Christian perspective, apathy towards healthy makes sense. This life, after all, is short and terrible compared to the eternal life that comes after death (to those who deserve it). What’s the point in trying so hard to extend it as long as possible?

      As a Marxist I’ve always dismissed cultural arguments like this as silly and lacking empiricism. But Marx, after all, acknowledges the role that mental conceptions play in history, especially in the case of religion, which can be a tool of the upper classes to prevent the lower classes from discovering their true revolutionary consciousness. No matter the origins of Buddhism, couldn’t it be a factor in how likely its devout followers (and there are many in Burma) are to participate in politics? I realize that the argument was made by Weber and recent studies have shown it to be empirically incorrect but I think the arguments he made about the ‘Protestant ethic’ were simply incorrect (I don’t agree that Protestant values are more conducive to capitalist behavior than Catholic values). And I also realize Laos, Cambodia, and Nepal would be strong counter-examples to everything I just wrote but they were all very different from Myanmar.

      Whatever the case I found their piety to be admirable and it was one of many countries I’ve visited where the masses living in extreme poverty surprised me with their happiness and positive outlook on life, which contrasts so strongly the depression and negativity I’ve seen so common in the inhabitants of the wealthiest countries.

  4. Cameron Says:

    “…form a pro-capitalist government that will negotiate terms with international agencies and multi-nationals to ‘develop’ Burma”

    “A problem remains: the most productive parts of the economy are in the hands of the military and their families through the state-owned companies,, Chinese style. But that is a problem for capitalist development that can be circumvented as it has been in China”

    Are you implying that Myanmar is currently “not” a capitalist state but transitioning to it? Or rather that it’s already capitalist but more capitalist development will take place via the multi-internationals, etc.? Please elaborate. Thank you.

  5. Cameron Says:

    I meant multi-nationals not multi-internationals.

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