Chua – World On Fire: How Exporting Free Market Democracy Breeds Ethnic Hatred and Global Instability

Chua, Amy, World on Fire: How Exporting Free Market Democracy Breeds Ethnic Hatred and Global Instability, Doubleday (2003) 340 pp.

In a post earlier this year, Jim Bennett outlined both his concerns and his appreciation for Amy Chua’s book “World on Fire.”

Unlike Jim, I was less convinced that she was offering a “one size fits all” model but very much inspired by the utility of her model for understanding the relationship of the world to the United States and the Anglosphere. The US, and its occasional allies, are locked in a passionate love-hate relationship with the rest of the world — a discussion fought now on television that often appears deranged or infantile yet is driven by very real concerns and anxieties. There’s hypocrisy and cant aplenty on both sides of the argument as far as the eye can see. And it is the “do as I say, not as I do” conundrums facing the Anglosphere that will drive new and focused solutions — new legal structures, new ethical propositions, new responses to weapons of mass destruction and hyper-destructive individuals, new balances between individual and social rights, new clarity and, one assumes, a newly-minted sense of self-preservation.

Much of the reading I’ve been doing over the last year has focused on national productivity figures (cf. Lewis’s The Power of Productivity) and on the EU’s response to the increasing GDP per capita gap between it and the US (The 2000 Lisbon Agenda). To summarize: the United States (with 300 million people) has roughly 30% greater GDP per capita (purchasing price parity) than all other nations over 10 million in size. Canada (at roughly 78% of the US standard and 30 million people) is the only exception. US GDP percentage growth also leads its large industrialized competitors. My reading focus has been on the solutions offered by serious people around the world to close the gap or find a way to accommodate the gap within a successful sustainable social model. At the same time, I’ve been watching the figures, and discussion, on higher education and the “scientific wealth of nations.” In many ways, however, the responses and strategies put forward to catching up with the US, by both the industrialized and industrializing world, have been eerily parallel to those documented in the past by Chua for nations who have struggled to cope with free markets and democracy over the last forty years. There’s a lot more finger-pointing and bad-mouthing than concrete progress.

To quote Chua (p.6):

This book is about a phenomenon – pervasive outside the West yet rarely acknowledged, indeed often viewed as taboo – that turns free market democracy into an engine of ethnic conflagration. The phenomenon I refer to is that of market-dominant minorities: ethnic minorities who, for widely varying reasons, tend under market conditions to dominate economically, often to a startling extent, the “indigenous” majorities around them.

Now, the Anglosphere is no longer an ethnic minority. But it is very much a minority of civic culture and legal approach (cf. LLSV) when judged by global standards. Yet the crux of Jim Bennett’s Anglosphere Challenge is that it is coping better with the approaching Technological Singularity than other cultures and other nations. The United States no longer has companions in this technological current — it has a crowd of slip-streamed commensals and a vast deeply-dispirited school of fish left in its wake. No one is expecting Ireland, Norway or Luxembourg to convert their per capita GDP into global market dominance. And for most of the world’s population in Africa, Latin America, and much of Asia (as highlighted in Chua’s book), only an Anglosphere catastrophe could allow them to return to the relative parity they enjoyed two centuries ago. For them, things are bad and getting relatively worse — but now they have their humiliation televised nightly in their living rooms.

I believe Chua’s greatest contribution to discussion is the description of the nature and history of these market-dominant minorities — of identifying Israel and the United States as regional and global market-dominant minorities (MDMs) respectively — and giving us some sense of the rhetoric that will be used (and the self-destructiveness that will result) if those two nations are challenged directly. Zimbabwe and Rwanda writ large is everyone’s nightmare. And Chua’s documentation of the Chinese, Indian, Lebanese, and Jewish MDMs ensconced throughout the Third World promises more turbulence before the story is over.

I think of the current Third World rhetorical arguments as succumbing to the Housecat-Tiger fallacy. In a thousand ways, many no doubt yet undiscovered, the housecat and tiger are identical. Their physiology, anatomy, DNA, behaviour, and cruelty are closely matched, feature for feature. Similarly, the West as a culture can be selfish, greedy, indifferent, violent, indolent, dissolute, sanctimonious, arrogant, discriminatory, and so on and so forth.

But the only comparison that really counts is that the housecat will bite your finger. The tiger will bite, and crush, your neck. So too, in the dominance of the Anglosphere over the scientific, technological, cultural, and military spheres. There are many cruelties (some of indifference, others intentional) inflicted on the nations and peoples of the world. But the alternative cultural and political structures on offer however all appear catastrophic by comparison with the Anglosphere. And lead back to the “good old days” of despots and tyrants and empires. The real empires, not the much-maligned facsimile of the Pax Americana.

All these global controversies seem more comprehensible if we use Chua’s concept of the “market-dominant minority” and identify the disruptive forces of the free market and democracy as working particularly in favour of the Anglosphere — effectively, according to Chua, America (the global MDM) and its farm team of talented English-speakers.

The statistics are compelling. Just as the ethnic German divisions that Hitler needed to defeat the Soviets were born, instead, in Minnesota rather than Bavaria, the European and Asian scientific talent necessary to compete with American firms now work in the US, not the Continent. And the graduates of African educational institutions migrate at very high rates to the industrialized world. With not a single non-English-speaking university in the top twenty (except for the University of Tokyo) — according to the Shanghai Jiao Tong University academic ranking of world universities. — the Anglosphere creates an irresistible magnetic force for the cream of scientific, academic, and managerial talent in the world. Chua, ironically, is a perfect example.

Turning again to her (p.259):

The bottom line is this. Democracy can be inimical to the interests of market-dominant minorities. There were good reasons why the Indians in Kenya and whites in South Africa, Zimbabwe, and America’s Southern states resisted democratization for generations. Market-dominant minorities do not really want democracy, at least not in the sense of having their fate determined by genuine majority rule.

Any more than the US, or the Anglosphere, wants its future determined by the votes of everyone else on the planet.

Chua concludes her book with sections on how markets and democracy might be more humanely and effectively introduced where they currently don’t exist. The case for a nuanced introduction of democracy and free markets, to reduce suffering in the general population, seems unassailable. Unfortunately, in societies firmly established on rent-seeking principles, every delay or fine-tuning in opening up a country provides more opportunities for minority predation (either in the market or in the government). And someone has to police the process. Usually at the barrel of the gun. This sounds a lot like Afghanistan and Iraq writ large. Without a “big brother” to ensure smooth transitions, the indigenous culture is left to sort things out for itself — a matter that is harder and harder with guns, explosives, and demagogues finding new synergy.

As mentioned above, Chua’s descriptions of how MDMs work, and how they are assaulted, makes for sobering reading but it also gives us a model to understand why Anglosphere culture is simultaneously admired, imitated, and repudiated. This is a well-written book with fascinating and useful summaries of recent events in very different parts of the world. No, it isn’t all things to all people. And, yes, one may quibble with the details of who’s an MDM and what role they play in any given country. But the broader question of how and why free markets and generic democracy unleash ethnic violence, and occasionally massacre and genocide, seems answered with some utility.

I found the description of the US as a non-ethnic market-dominant minority very thought-provoking and a very useful tool for understanding the rhetoric of visceral resentment and plaintive dependency which is now dowsing America with metronomic frequency.


Table of Contents

Part One – The Economic Impact of Globalization

1 Rubies and Rice Paddies – Chinese Minority Dominance in Southeast Asia
2 Llama Fetuses, Latifundia, and La Blue Chip Numero Uno – “White” Wealth in Latin America
3 The Seventh Oligarch – The Jewish Billionaires of Post-Communist Russia
4 The “Ibo of Cameroon” – Market-Dominant Minorities of Africa

Part Two – The Political Consequences of Globalization

5 Backlash against Markets – Ethnically Targeted Seizures and Nationalization
6 Baclash against Democracy – Crony Capitalism and Minority Rule
7 Backlash against Market-Dominant Minorities – Expulsions and Genocide
8 Mixing Blood – Assimilation, Globalization, and the Case of Thailand

Part Three – Ethnonationalism and the West

9 The Underside of Western Free Market Democracy – From Jim Crow to the Holocaust
10 The Middle Eastern Cauldron – Israeli Jews as a Regional Market-Dominant Minority
11 Why They Hate Us – America as a Global Market-Dominant Minority
12 The Future of Free Market Democracy

Discuss this review at the Chicago Boyz Forum.

James Rummel on America the Hyperpower.

7 thoughts on “Chua – World On Fire: How Exporting Free Market Democracy Breeds Ethnic Hatred and Global Instability”

  1. There were good reasons why the Indians in Kenya and whites in South Africa, Zimbabwe, and America’s Southern states resisted democratization for generations.

    I’m not sure I would lump whites in the American Southern states in with the others. They certainly were not an market-dominant minority being (1) firmly in the majority and (2) not terribly productive. The south’s long resistance to widespread democracy, even for poor whites had more to do with maintaining the south’s deeply hierarchal almost feudal social and political system.

    Otherwise, I think Chao is on to something. It’s simply to tempting to believe that someone who has bested you cheated than it is to believe you need to improve your own game.

  2. All this time to discover the concept of “tyranny of the majority?” I thought this was worked out long ago, maybe in the Federalist Papers.

  3. It’s more than tyranny of the majority. The liberal vision (both libertarian and socialist-liberal) has been that ethnic and tribal interests would fade away in the face of economic development.

    But in much of the world, identity/ethnic solidarity is so strong that the majority would accept worse outcomes just to spite a successful minority. While Madison, et al. worried about majoritarian redistribution, they did not focus greatly on the sort of mindset where envy dominates individual self-interest. Identity politics has helped to revive and strengthen such frictions even in the liberal West, while denying the right to such ethnic pride to dominant white elites, especially in the Anglosphere.

  4. I have long suspected that the GDP gap between the US and the rest of the world is mostly due to the Dollar.
    The use of the dollar for international trade allows the US to print money like hell and never face any consequences so far.
    Any country , without a dollar like currency, would have had to devalue its money or increase interest rates.
    This Gap will disappear slowly either when global exchanges slow down or when 1 or more currencies take some market share.
    As Chicago boys, I guess you already discussed this possibility long time ago.

  5. It is difficult for people in the West, in general, and the US in particular, to understand how threatening and destabilizing the various operational values of more open, democratic political systems are in the eyes of the rest of the world’s cultures. This goes double for industrial capitalism and global free (or freer) trade.

    Traditional cultures are exactly that—organized around very strong and well understood traditions that divvy up everything according to clan, tribe, social class, and birthplace, among other factors.

    Western societies were just like that, and some still are, a few centuries ago. All the misgivings and hostility now emerging in the developing nations is a recapitulation of the very same antagonisms towards these cultural styles that were often voiced in the development phase of Anglo societies—violation of class norms, racial or religious impropriety, disturbance of settled methods and markets, and, most importantly for many, the gradual fading out of much of the “secure” niches and status that families, clans, and other groupings had built up over the centuries.

    It is not the case, after all, that there is some form of uncritical reverence for either democratic principles or free market economics in western societies. The last several centuries as these values have come to the fore have been times of immense turmoil, violence, and continual dislocations. Several of the most powerful political and economic ideologies in the west, esp. in Europe, have been specifically anti-democratic and anti-capitalist, and these theories are still influential around the world.

    As a thumbnail sketch, most human cultures are combinations of fraternal and feudal associations. Various social, religious, economic, and class positions are parcelled out by the rules of the system, and people’s positions within the closed universe are clear and well understood.

    Capitalism and democratic processes SEEM to violate and overturn these revered processes. It is not until later in the process of a society operating under these new ideas that it becomes very clear that all that has happened is that one set of structured, feudalist arrangements have been replaced by another.

    Granted, the strata are more fluid, and the hierarchies are determined by less hereditary and more meritocratic standards, but the inherent human tendency to construct understandable social structures always seems to mean that, eventually, form follows function.

    If the function is the operation of a social mechanism, either political or economic, a form most comfortable and reasonably familiar will eventually emerge. The reason some minority social units thrive in the anglosphere’s petri dish, and others do not, is that they are pre-adapted to the new medium.

  6. Mitch, the book is very good, with much good material. It goes beyond a mere restatement of the idea of the tyranny of the majority.

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