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National security and economic development

CROSSROADS (Toward Philippine Economic and Social Progress) - Gerardo P. Sicat - The Philippine Star

I was recently in Sydney, Australia where I delivered the International Day of Peace Address before the United Nations Association of Australia Peace Program.

The United Nations General has declared Sept. 21 as the International Day of Peace around the world. Observing this day annually is designed to remind us about the ideals of peace within and among all nations and peoples.

For us some 45 years ago, Sept. 21 rings a different memory, martial law. I will skip to the spirit of my talk.

Peace and economic growth. The main concern of my address was to explore the connection of peace and economic growth.

In my view, economic growth helps to promote peace. Through economic growth, countries experience a set of good results: rising incomes, further investment and higher productivity that finally leads to improved living standards.

These set of outcomes keep repeating themselves in a cycle, essentially creating some a cumulation of essentially good results. Over time, the the main outcome is a steady rise in living standards that makes the countries become better able to solve their economic and other problems.

The main examples of countries with remarkable economic growth in the world during the postwar period come principally from the Asia and Pacific region.

The high growth economies of East Asia. The list of countries is impressive. There was Japan, at first, from the ruins of war. Then the four “economic tigers” (Hong Kong, South Korea, Taiwan and Singapore), within ASEAN, there are Indonesia, Malaysia, Thailand, Vietnam and the Philippines. The most successful of the countries, however, is exemplified by China.

All countries have had different period of high growth, due mainly to differences in problems and timing of their economic awakenings.

All the examples of long term growth have experienced sustained national economic growth rates for prolonged periods in their recent history. Some grew at the still above average pace of five to seven percent per year.

The more spectacular growth rates have been experienced by China, South Korea, Japan, Singapore, Hong Kong, and Taiwan during their period of high growth from eight percent per year to 10 percent, even exceeding at times the 10 percent upper range.

Almost all have managed to experience falling population growth rates, making the per capita gains improve over time all the more. (The Philippines is the exception in this experience because the population growth rate has remained relatively the same.)

All the economies discussed are not only outstanding examples of growth in the East Asian region, but also in the context of modern economic growth in our world.

Security and growth. A common peculiarity among these countries is that during their periods of high growth, they were either in authoritarian mode (“strong government”) or under the protection of strong national security arrangements that shielded them from large internal turbulence.

In the case of countries with security treaties with the US, the governments all maintained strong or highly disciplined governments.

The outstanding cases of countries with high economic growth either happened under the guidance of strong governments or just took place under the protection of credible security arrangements with powerful nations. The mutual security treaty arrangements worked out during the Cold War provided such a protection and assurance to some countries.

During colonial times, development took place under the protection of severe rules against those who would rebel and destroy the works and plans of the foreign masters.

In post colonial times of the recent past, some countries achieved sustained growth and economic development under the protection of a military ally or of a strong internal government, while also limiting a few critical freedoms. In time, such limits get relaxed.

For instance, Japan, South Korea, Taiwan underwent their postwar development under the US military security umbrella against potential enemies. That was strong defense against domestic and external turbulence.

The spectacular growth of Hong Kong before 1997 took place under the police protection of the British empire. The same happened with Singapore and Malaysia before their independence.

After independence, Lee Kuan Yew’s party in Singapore and the UMNO government in Malaysia, respectively, instituted national security laws similar to the tight measures against individual liberties under the British in order to keep internal peace.

Thailand often reverted to military rule whenever democratic space endangered stability. Thailand’s balanced economic growth featuring agricultural and industrial expansion has been one of the most impressive in Southeast Asia.

Through sporadic military coups upon military coups and interludes with democratic elections, Thailand’s ruling military had let economic growth take place by being mainly concerned with instituting government with their inevitable consequences on civil liberties, but allowing development policies to proceed without break.

Indonesia’s growth was fostered by a long period of stabilization that took place under Suharto’s strong man rule beginning in 1965 and ending only in 1998. Suharto’s rule was a classic military dictatorship that gradually tolerated a partial representative political democracy in the form of an elected parliament.

China’s economic consolidation and growth took place under a strong Communist government that allowed major economic reforms to take place. The reforms were instituted by Deng Hsiao-ping as it tried to expand both agriculture and industry.

The major reforms unleashed economic forces that led to the rapid growth of the economy. Within four decades China transformed itself from a very poor country to one that made it become a middle income prosperous nation.

Even though the economy was opened to broader economic reforms, the government kept a strong hand in restraining domestic dissent. Hence, political reforms were not allowed to follow the pace of economic reforms.

This reminds me of the problem in most East Asian countries. Many have adopted strict national security measures that were once considered excessive. However, as they raised their economic achievements, they gained the comfort and the confidence to relax slowly what were initially denied.

But let us ask this question. Aren’t these strict measures in these nations reminiscent of the policies of colonial rulers? Under the instance of rebellion or treason, could a government not act in its own defense?

This was the essential nature of the arguments that many of these countries with strong national security laws have undertaken in minimizing criticisms and dissent.

One result of that commonality has been relatively high economic growth rates experienced in many of them.

My email is: gpsicat@gmail.com. Visit this site for more information, feedback and commentary: http://econ.upd.edu.ph/gpsicat/

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