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Book Review: Foreign wealth changes balance of the world
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Published: October 4, 2009
Updated: 10/03/2009 08:45 pm
THE MIRACLE: The Epic Story of Asia's Quest for Wealth. By Michael Schuman. HarperCollins. 422 pages. $29.99.
Talk about being in the right spot at the right time. Michael Schuman has spent the last 10 years at the epicenter of the most momentous story since World War II. He has covered the Asian business beat, first for The Wall Street Journal and then for Time.
He has now distilled this experience into The Miracle. It isn't the first and surely won't be the last book to describe the economic revolution that is changing our world, but it is a lucid, entertaining and astonishing summary of how the process has accelerated over the last 50 years.
Schuman shows how it all began with Japan and South Korea pioneering the so-called Asian model, which combined an entrepreneurial private sector with vigorous government support all aimed at raising living standards by growing industries capable of producing income through exports. At first the targeted industries were such heavyweights as steel, autos and shipbuilding.
Next came several smaller economies that capitalized on the tech boom and the sudden need for finance in the region. Thus, Singapore, Hong Kong, Taiwan and others joined in. Finally, the biggest pair of all -- India and China -- abandoned years of dysfunctional ideology to play catch-up with their neighbors.
The results of this evolution have been a colossal transformation. A couple statistics tell the tale. In 1981, 80 percent of East Asians lived in deep poverty. By 2005, it was down to 18 percent. Between 1965 and 2007, the increase in per-capita income has been 2,260 percent for China, 4,133 percent for Japan, and more than 15,000 for South Korea.
In telling this story, Schuman introduces us to government and business leaders from nine countries. The tales of the founders of Sony and Honda are familiar, but still inspiring. Those of the men who made Taiwan and mainland China tech powers and India a leader in data-processing are less well known but equally absorbing.
Schuman suggests the miracle resulted from several factors. Public and private sectors collaborated on seeking economic success. Ideology was set aside in a pragmatic search for whatever would work. In country after country, a strong political leader was able to find a pioneering economic or technical advisor with which to partner. Equally important, the Asian people were hungry for opportunity after hundreds of years of missed opportunities and colonial exploitation. They were prepared to work very hard, defer gratification and to save, and they valued education very highly. The longtime leader of Singapore, Lee Kwan Yew, also suggests that this miracle is at least in part an American success story, since we provided Asia with a model to imitate, markets to serve and a security umbrella without which "there would have been no growth."
Now we find ourselves in a fierce competition with a region we long dismissed as a benighted backwater, and many are fearful. Schuman isn't among them. He regards Asia's burgeoning prosperity not as a zero-sum game we are losing but as an opportunity for mutual progress. But for that to be true, Americans may have to adopt some of the same virtues that spurred the miracle and, incidentally, our own growth in the past -- public-private cooperation and a thrifty and motivated populace willing to work hard, study hard, innovate and save.
Time will tell whether we're up to the challenge, but The Miracle makes clear that Asia, having wakened from a centuries-long slumber, isn't about to doze off again anytime soon. Americans interested in the world in which they now find themselves can learn a lot from The Miracle. It's a wonderful story, well told, that is intriguing, sometimes alarming but ultimately inspiring.
Keith Monroe, a former Journal editorial writer, lives in Greensboro.
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