For nearly four decades now, debates on the East Asian “miracle” have largely revolved around the relative roles of states or markets in that process. The market-centred perspective was prominent in the 1980s when World Bank economists searched for “poster countries” that could support their policy advice. State institutionalists, on the other hand, offered an arguably more historically accurate account of how bureaucracies in Japan, Taiwan and South Korea exerted tight control over domestic financial flows, and were able to direct corporations’ investment in industry in accordance with the national plan. However, the narrow focus on the relationship between bureaucrats and businessmen within this approach failed to take note of one crucial underpinning of the region’s “success” in export-oriented catch-up industrialisation, namely the state-orchestrated repression of labour as a collective social actor.
In my recent book, Labour and Development in East Asia, I utilise Antonio Gramsci’s concept of passive revolution to explain how it was that the East Asian region in particular came to possess this crucial prerequisite for rapid industrialisation. As is apparent in Gramsci’s discussion of the impact of Americanism and Fordism, the concept of passive revolution sheds light on how late developing states seek to facilitate the reorganisation of capitalist production in response to external pressures while at the same time forestalling the emergence of a collective subjective will on the part of subaltern social actors such as labour.
The reason why this regional passive revolution was so successful in East Asia is closely related to the onset of the Cold War. In 1945, in the face of widespread popular demands in the region for democracy and progressive social reforms, the US forged alliances with conservative elites and bolstered the repressive mechanisms of the state under the ideological framework of anti-communism. This process also involved, however, land reform programmes that were in fact modelled loosely on those carried out in China and North Korea. By doing so, the impetus for socialist revolution in the countryside in capitalist northeast Asia was dissipated. This again can be understood as an aspect of passive revolution whereby subaltern demands are partially co-opted as part of a conservative state-led approach from above to facilitate catch-up industrialisation.
Through this top-down intervention, however, the US laid the basis for the labour regimes which in turn underpinned rapid industrialisation in the region. However, East Asia’s industrial rise, and that of Japan in particular, contributed towards increased international competition and overproduction, and to the world economic crisis of the 1970s. Initially, South Korea and Taiwan were not adversely affected by these developments, and in fact, became “spatial fixes” for much of the world’s mobile capital. Furthermore, the Nixon doctrine which sought to tackle the “crisis of US hegemony” following Vietnam by shifting the burden of defence onto the Asian countries themselves spurred a process of state-led heavy industrialisation which served to strengthen the structural power of the working class.
In South Korea and Taiwan, this process led to the emergence of labour movements that challenged authoritarian developmentalism. As I argue, however, the shift towards democracy at the end of the 1980s had a dual character in that it coincided with the transition towards neoliberalism in the region. The heightened social commodification of labour was actively pursued by state and capital as a new passive revolution aimed at tackling and indeed reversing the rise of labour, even if labour did gain certain formal political rights such as the right of association.
One question that leads from this analysis is the extent to whether China as “workshop of the world” may witness a similar labour uprising. One argument has been that China’s dependence on low wages means any proactive government measures are unlikely. However, if understand China’s reform era within the framework of passive revolution, we can see how the government is seeking to mediate between the spread of global capitalism in East Asia and the subaltern demands of labour.
How exactly does the Chinese state seek to forestall the emergence of labour as a collective social actor? The Hu Jintao government sought to deal with an increasingly restive working class through the “legalisation of labour relations”, namely the attempt to channel labour unrest into institutionalised channels. This involved delegating the role of managing labour-management relations down to the provincial/local level while strengthening the role of unions in policymaking as well as managing local workers’ grievances. It is important to note that unions remain fully state corporatist in that they do not represent workers’ interests but rather act as a neutral mediator between labour and management.
The state also legislated a new Labour Contract Law, which compels companies to establish labour contracts for workers. The Law has been criticised for institutionalising individual rather than collective labour rights, and with the freedom of association still proscribed, it is questionable how meaningful the Law’s protections are. However, the Law does at least officially recognise the notion of labour rights, however limited that may be, and as such, they become part of workers’ collective consciousness. Workers’ protests increasingly go beyond simply defensive issues of infringements of their rights to more proactive issues such as wage increases. This suggests how the partial and limited acceptance of subaltern demands inherent in passive revolution also can provide the basis for resistance.
It is also important to note that China is undergoing structural changes in its labour market of the kind previously seen in Taiwan and South Korea in the 1980s. It has been keenly debated in recent years whether China has reached its Lewisian Turning Point, i.e. the point at which the country shifts from an unlimited to limited labour supply. There have been considerable labour shortages and wage increases in coastal areas, and as a result, much of China’s low end manufacturing has begun to shift either abroad or to inland areas. Interestingly, this is actually in line with the government strategy of bringing more equitable development to the inland areas. However, wage rises have also combined with the impact of the global financial crisis to raise questions about the Chinese governments’ developmental strategy, and ties in with increased government calls to shift away from export dependence towards greater reliance on domestic consumption.
Gramsci’s framework of passive revolution thus sheds light on an often neglected aspect of East Asia’s “miracle growth”. It focuses on the social struggles underpinning state formation, and as such, elucidates how political and economic elites in specific national contexts are exposed to the external imperative to facilitate catch up development, and as part of that process, are compelled to take measures to contain the emergence of labour as a collective subjectivity. Given the considerable social restiveness that continues to characterise production in the East Asian region, however, passive revolution is likely to continue to characterise late development in the 21st century.