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[PROFILE] Amy Chua - Professor and Author

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  • madchinaman
    Education http://www.law.yale.edu/outside/html/faculty/alc53/profile.htm A.B., Harvard, 1984 J.D., Harvard, 1987 Professional Positions Executive Editor,
    Message 1 of 1 , Nov 13 4:10 PM

      A.B., Harvard, 1984
      J.D., Harvard, 1987

      Professional Positions Executive Editor, Harvard Law Review

      Law Clerk for the Honorable Patricia M. Wald, U.S. Court of Appeals,
      D.C. Circuit, 1987-88
      Associate, Cleary, Gottlieb, Steen & Hamilton, 1988-93
      Associate Professor, Duke, 1994-2001
      Visiting Professor, Columbia, 1999
      Visiting Professor, Stanford, 2000
      Visiting Professor, NYU, 2000
      Professor, Yale, 2001-

      Amy Chua is a professor at Yale Law School. She lectures frequently
      on the effects of globalization to government, business, and
      academic groups around the world. She lives in New Haven,

      Contact Info
      Yale Law School
      P.O. Box 208215
      New Haven, CT 06520


      Prior to joining the Yale Law School faculty in 2001, Professor Chua
      practiced law on Wall Street where she worked on international
      transactions throughout Asia, Europe, and Latin America. Her recent
      book, World on Fire: How Exporting Free Market Democracy Breeds
      Ethnic Hatred and Global Instability, made both The New York Times
      and Business Week bestseller lists and was selected by The Economist
      as one of the Best Books of 2003.

      As a speaker, Professor Chua has addressed numerous government and
      policymaking institutions, including the World Bank, the Brookings
      Institution, the United Nations, and the CIA. She has also lectured
      widely outside the United States, including nations like Argentina,
      Bolivia, Chile, China, Mexico, Taiwan, Turkey, and South Africa. She
      teaches in the areas of contracts, law and development,
      international business transactions, and law and globalization.


      Amy Chua
      by Joel Tannenbaum


      "Americans don't hate Bill Gates, even though he has owned as much
      as 40 percent of the American population put together. They don't
      feel cheated or exploited by him, or that he has humiliated
      Americans by making billions 'on their soil.' Not so in societies
      with a market-dominant minority. In these societies, class and
      ethnicity overlap in a particularly dangereous way. The extremely
      wealthy stick out -- whether because of their origins, skin color,
      religion, language or 'blood ties' -- from the impoverished masses
      around them, and they are seen by these majorities as belonging to a
      different ethnicity or people -- as 'outsiders' who look different,
      speak differently, or as Fiji's nationalist leader George Speight
      recently said of his county's market-dominant Indian
      minority, 'smell different.'...

      "Most Americans -- whether ordinary citizens, commentators on
      globalization, or policymakers -- are unaware of this problem. As a
      result, we have been confidently exporting free market capitalism to
      the rest of the world, oblivious the ethnic hatred and instability
      we are systematically helping to breed." (World on Fire, pp. 19-20.)


      As the Berlin Wall fell, advocates of free markets and one-size-fits-
      all democracy assured us that we were witnessing "the end of
      history." Since then, we have seen ethnic cleansing in Rwanda, East
      Timor and the former Yugoslavia. We've seen the collapse of the
      Southeast Asian "tiger" economies and, more recently, the adoption
      of a Napoleonic foreign policy by the United States. Now, in 2004,
      these pro-globalization folk are sighing quietly and realizing that
      maybe history isn't over quite yet.

      This realization has spawned an odd new class of intellectuals: anti-
      globalism globalists -- free-market advocates who still shudder at
      the horrors of the welfare state, and yet have seen with their own
      eyes the catastrophe wrought by economic liberalization everywhere
      from Argentina to the former Soviet Union.

      Foremost among them is Amy Chua, a Yale Law School professor who
      spent much of the 1990s helping Mexico to privatize its
      telecommunications systems. In 1994, Chua's aunt, a member of the
      Philippines' wealthy and insular Chinese elite, was brutally
      murdered by her Filipino chauffeur. Police listed the motive
      as "revenge."

      These experiences and others led her to a critique of globalization
      based on a theory of "market-dominant minorities": economically
      successful ethnic minorities who become the victims of violent
      hatred when the societies they live in are destabilized by the
      imposition of market reforms and democratic elections.

      Chua's book, World on Fire (Doubleday), is fascinating and
      frustrating. Fascinating for the originality of her argument and for
      her thumbnail sketches of ethnic conflict on six continents.
      Frustrating for the stubborn tenacity with which she clings to the
      notion (in spite of every single example she presents) that, as
      Margaret Thatcher used to say, "there is no alternative."


      Welcome to a Conversation with History. I'm Harry Kreisler of the
      Institute of International Studies. Our guest today is Amy Chua, who
      is a Professor of Law at Yale University and the author, most
      recently, of World on Fire: How Exporting Free Market Democracy
      Breeds Ethnic Hatred and Global Instability.

      Amy, welcome back to Berkeley.

      Thank you very much.

      Where were you born and raised?

      I was born in Champaign, Illinois, and spent the first eight years
      of my life in West Lafayette, Indiana. And then my father -- you can
      figure out that he's an academic -- we were at Purdue and then we
      moved to Berkeley, California, when I was eight, and I grew up here.

      So you went to the public schools in Berkeley?

      I went to El Cerrito High School, a public school -- yes, very

      Looking back, how do you think your parents shaped your thinking
      about the world?

      It's complicated. A lot of it was inadvertent. My parents were both
      immigrants from the Philippines. They were ethnic Chinese, but they
      grew up in the Philippines. And my parents actually eloped to MIT,
      so, not the first place --

      I hope they took books with them!

      -- not the first place I would elope to, but that's where they ended
      up. I grew up with my three younger sisters in a fairly typical
      Chinese immigrant family. We had to work; we had to work very hard.
      My parents were fairly strict and a lot was expected of us, and we
      did not enjoy the same freedoms that a lot of our friends did.

      I would imagine a real emphasis on education and books?

      Yes. Yes, principally education, books, and family. I think that
      would be the core.

      Where were you educated after El Cerrito High?

      I went to Harvard. I applied just to that one place. I was going to
      Berkeley, but I went to Harvard. I went to Harvard Law School, as
      well, and then practiced on Wall Street for a while, and then
      eventually moved my way into academics, and I now teach at Yale.

      As an undergraduate in Harvard, you majored in economics, right?

      Yes, that's right.

      What led you to the law? Why did you decided to go to law school?

      Sadly, I think it was really just a default decision. Again, maybe
      playing to stereotypes too much, but my parents had high hopes for
      me in the sciences. I was actually pre-med, and I chose economics
      because it wasn't applied -- I started off in applied math, and
      economics was, I thought, at least a soft science; [hoping] that
      maybe that would appease my parents. But I enjoyed it very much and
      I focused on development while I was at Harvard. I applied to
      graduate schools also, but I sort of knew that I wasn't going to be
      a scientist, and just took the plunge, and it worked out very well.

      What kind of law did you practice, once you started practicing?

      Well, here the themes start to come together. I took a lot of
      international law courses. You kind of try to escape who you are,
      and I've always been interested in developing countries,
      international issues, cultural issues, because we were immigrants
      and outsiders in this country. My parents grew up in a developing
      country, two developing countries -- China and the Philippines.
      After graduating, I had clerked for a judge on the U.S. Court of
      Appeals for a year, and I wanted to go straight into teaching. She
      said, pretty frankly (she was wonderful), "What are you going to
      teach? You don't know anything!" She suggested that I get some

      And this was ... which judge? Tell us who the judge was.

      She is Chief Justice Patricia Wald* of the U.S. Court of Appeals for
      the D.C. Circuit. A real role model for me. But I decided to go to
      Wall Street. I joined a very large, international corporate
      practice, and it worked out really well. I spent four years working
      exclusively on international transactions -- some in Europe, some in
      Asia, but principally in Latin America. So I saw a whole other set
      of developing societies -- not Southeast Asia. Southeast Asia is the
      society I'm most familiar with, my own background. But I saw another
      very different one, and saw commonalties and differences.

      Origins of an Idea
      What years were you practicing [international] law?

      I graduated from law school in 1987, clerked for a year, so around
      1989 to 1994 I was on Wall Street. It was right after the fall of
      the Berlin Wall, so [everyone was emphasizing] markets and
      privatization as the answer to everything ...

      And globalization?

      Absolutely, but the "up" side of it. It was all, "Let's put in stock
      exchanges around the world, and foreign investment should go
      everywhere." I worked -- luckily, a fabulous experience -- I spent
      most of those four years working on the privatization of TelMex,
      which is Teléfono de Mexico. It was Mexico's national telephone
      company, which at that time was government-owned. My law firm
      privatized it, selling it, in part, to Southwestern Bell, and in
      part to some very wealthy Mexican interests.

      What did you learn from that work? Were you surprised by the things
      that you ran into, not so much the law, but rather the context
      within Mexico in which this privatization was happening?

      Lots of things surprised me. I was young and it was very exciting
      and glamorous. My firm happened to represent the government of
      Mexico, which is unusual. Our clients, the people I dealt with, were
      the Finance Minister and the wealthy businesspeople. On the many
      trips I made to Mexico, I did notice the unspoken ethnic angle.
      Often when people talk about Latin America or Mexico, they
      say, "Look, we don't have the same kinds of ethnic divisions or
      racial divisions that you have in the United States because
      everybody here is mixed. We're all Mexicans. There are no ethnic
      divisions." But one thing I noticed was that all the people I worked
      with, the finance ministers, certainly all the bankers and the
      businesspeople, were white, at least by U.S. standards -- they were
      taller, Spanish-blooded, very Europeanized, spoke many languages,
      many were educated abroad, very elegant. And the majority of the
      people ... I mean most of the people doing the copying, and the
      Xeroxing, and the mopping, were very clearly more indigenous-
      blooded. They were visibly shorter, darker -- and so that was filed
      away [in my mind].

      Another thing I noticed is that it was a very euphoric moment. I
      remember writing documents: "Privatizing is going to lift the masses
      out of poverty. With the proceeds, we're going to build hospitals
      and schools; it's a win-win situation." After I left Wall Street and
      following what happened, following the newspapers, then I noticed
      that privatization isn't a panacea.

      I'm ultimately a fan of privatization. I believe that it was a
      positive thing for the Mexican economy. But the beneficiaries of
      privatization, at least that one, were ... This was the Salinas
      [presidential] administration; there was a lot of corruption, and
      the beneficiaries were much, much more limited than I initially
      optimistically imagined. In fact, the papers just a few years later
      said, "Privatization was touted as the solution to poverty. Instead,
      it's made thirteen families into multimillionaires and
      billionaires." So I think it's a much more complicated story.

      What in your background sensitized you to see what you were seeing?
      Not everybody in your shoes would have reached these conclusions
      necessarily. Some might. You've already told us you majored in
      development studies and economics at Harvard, so that must have
      played a role.

      Right. Well, for better or for worse, I think I've always been a
      little bit too conscious of ethnic divisions. My own family, my
      parents, grew up in the Philippines, and they are, as I mentioned,
      ethnic Chinese. The Chinese in the Philippines are a tiny minority.
      They represent about 1 percent of the population, but they control
      about 60 percent of the private economy, including the four major
      airlines and virtually all the major banks and conglomerates. So,
      first of all, it's a taboo topic. It sounds like it can't be true, a
      minority controlling 60 percent of the economy, but it is true. It's
      well documented. And anybody who works in business and has done work
      in Southeast Asia sees this, not just in the Philippines but in
      Indonesia, Malaysia, Thailand, Burma. So I was sensitized to the
      ethnic dimensions of capitalism.

      I didn't grow up in the Philippines, but we visited very often and
      it's a strange thing for somebody growing up in the United States. I
      went back when I was one, and then when I was eight, and then many
      times afterwards. My father's family had a huge hacienda in an all-
      Chinese community, and living in the basement were fifteen or twenty
      servants, all ethnic Filipino. And that's very typical. They were
      wealthy, but not among the wealthiest Chinese. That's a pattern.

      So I was ... I think you're right, I never quite thought about it
      that way, but I think that I was sensitized to noticing when the
      people who are wealthy in that country aren't just wealthy, but also
      may have ethnically distinguishing characteristics. I noticed the
      parallels: "Oh, the wealthy people here look different." It's
      certainly not just biological; I don't even know how much of it is.
      Part of it is the clothing, the foreign education, the polished
      manners. But there is an ethnic dimension to it. Certainly, many of
      the families [of the Mexican ruling class] were from old Spanish
      families that never intermarry now these days with the poor
      indigenous populations. The Spanish colonizers did freely mix with
      and rape the indigenous populations. I noticed the big differences.

      In the Philippines, it's the Chinese, the Spanish-elite, and then
      it's the huge, roughly 80 million indigenous Filipino majority. And
      there are very stark differences. In Latin America, it is much more
      of a spectrum. It is different; the skin color, it's not black and
      white, but I noticed the parallels as well.

      Now we're going to talk about your new book, which I will show,
      called World on Fire, which has been very well received, recommended
      by The New York Times and The Economist. Before we talk about the
      book itself, there's a personal story that was very important for
      you, that led you to focus on the problem, relating to your aunt.
      Tell us that story.

      Okay. In 1994, I had just started teaching in North Carolina. I
      received a call from my mother in Berkeley. She told me that my
      aunt, my father's twin sister, had been murdered in her home in the
      Philippines, in Manila. She'd been killed by her chauffeur.
      Obviously, this was a terrible family time for us. We were very
      close to my aunt. She was my father's twin.

      My aunt, as I mentioned, was a member of the Philippines' extremely
      entrepreneurial 1 percent Chinese minority, and her chauffeur was a
      member of the indigenous Filipino majority. Everybody was upset, but
      I, in particular, was very upset by the criminal investigation,
      because we went back and I asked if there had been any developments
      in the murder, and my uncle said, "No, the case has been closed. The
      suspect ... " And, actually, it wasn't even ... You know, the
      maids ... There were two maids who were also complicit -- they
      confessed. There was no doubt as to who had done the killing. But
      the police said the suspect had disappeared, the maids were let go,
      the case was closed.

      I asked my uncle, "How can this possibly be?" And he said, "You're
      so naïve. This is the Philippines; not the United States." It turns
      out he wasn't just being cynical. It's true. My aunt's killing was
      part of a much larger pattern in the Philippines. Hundreds of ethnic
      Chinese are kidnapped annually, not always killed, but kidnapped all
      the time. The police force and the military are principally
      Filipino. In fact, they all are; there are no Chinese. They are
      sympathetic [to anti-Chinese sentiment], and often they're quoted in
      the papers as saying, "Look, the Chinese can afford the ransom. It's
      a form of redistribution." I'm not saying they condoned the murder,
      but they're sympathetic to the frustration of this very large
      majority in the face of a tiny, outsider minority that controls so
      much wealth and has all these servants, and seem very arrogant. The
      Chinese don't intermarry. They speak a different language.

      I decided to open the book with that story because I looked at the
      police report, because I was so upset about the case being closed.
      The most striking thing was in a section for motive; I expected it
      say robbery or something, because jewels were taken. But instead,
      there was just one word, and that was "revenge." That startled me
      and got me thinking. In a way, that idea has been an organizing
      motif for the book. I wanted to be very balanced. It's not blaming
      one side or the other, but trying to see the picture from either the
      point of view of the person who killed my aunt, without ever
      condoning it -- I mean, we're filled with anger still, but at least
      seeing what his perspective was -- and then seeing it from the side
      of what I call market-dominant minority, this ethnic minority that
      does so well in a country economically.

      Markets and Democracy
      Let's talk about this idea that at one level is so simple and so
      obvious that nobody had put it all together with the sweep of both
      history and geography that you have done. What do you mean by
      an "ethnic-dominant minority"? We touched a little on this already.
      But once you have that concept, help us understand what it is and
      how it was shaped in your own mind.

      The concept I used in the book -- it's a bit of a mouthful -- is a
      market-dominant minority. By this term I mean an ethnic minority, or
      ethnic minorities, who, along with foreign investors, can be
      expected to economically dominate the poor, indigenous majorities
      around them, at least in the near to mid-term future. I'm not
      talking about ethnic stereotypes -- in the United States, we worry a
      lot about ethnic stereotypes. I'm talking about something more
      serious, because I'm talking about actual, starkly disproportionate
      control of the economy by an ethnic group.

      So, first of all, it's not just the Chinese; although the Chinese
      are publicly the most well-known market-dominant minority. The
      Chinese are 3 percent of the population in Indonesia, a larger
      population in Malaysia; they're about 10 percent of the population
      in Thailand. But they are extremely economically dominant throughout
      Southeast Asia.

      Other examples include Indians throughout the countries of East
      Africa -- Kenya, Tanzania, Uganda. The Lebanese in the countries of
      West Africa, exactly the same position, very small in numbers, 1
      percent, 2 percent, and yet they control such a disproportionate
      amount of the corporate and commercial sector. Other examples are
      Whites in Zimbabwe, Whites in South Africa, Whites in countries like
      Bolivia, Ecuador, Guatemala. Although, again, in a more complicated
      sense in Latin America. Less well-known examples of African groups
      (the Ibo in Nigeria, the Kikuyu in Kenya), the Croatians in the
      former Yugoslavia, Jews in post-communist Russia. All of these
      groups came under free-market policies, the kind that we were
      pushing in the nineties and eighties, to dominate the economies in
      which they live to a startling extent.

      The thesis is, very simply, that most non-Western countries have
      social and ethnic structures totally different from what we have in
      the West. In particular, in the numerous non-Western countries that
      have a market-dominant ethnic minority, markets and democracy
      basically benefit not just different people or different classes,
      but different ethnic groups, creating an explosive situation that we
      just aren't familiar with here. Markets will tend to leave to the
      economic dominance of this small ethnic minority, whether it's the
      Indians in Kenya or the Chinese in Indonesia.

      At the same time, overnight democracy will empower the poor,
      indigenous majority. What happens is that under those circumstances,
      democracy doesn't do what we expect it to do -- that is, reinforce
      markets. [Instead,] democracy leads to the emergence of manipulative
      politicians and demagogues who find that the best way to get votes
      is by scapegoating the minorities. They say, "The reason we're all
      poor here in Indonesia is because the Chinese are stealing all the
      wealth, so let's have Indonesia for Indonesians," or Serbia for
      Serbs, or Zimbabwe for Zimbabweans. "Let's take back the economy."
      So in this case, markets and democracy are not mutually reinforcing.
      Markets benefit one ethnic group, democracy empowers a different
      ethnic majority, and the result is a lot of instability.

      In a moment we'll talk about how this goes against the conventional
      wisdom of American power in the world, or as some are now calling
      it, the American empire. But before we do that, I want to get from
      you a better sense of why these particular groups tend to benefit
      most. What you're suggesting is they were positioned before
      globalization hit in a powerful way of the nineties. There are
      different reasons, different explanations for that, right?

      That's the most important part of it, that there are different
      reasons for the market dominance of different groups. This is why I
      think these topics shouldn't be taboo. Often, it seems it's so
      difficult to talk about ethnic minorities who disproportionately do
      well economically. But the reason it shouldn't be taboo is because
      by market dominance, I'm not talking about any kind of inherent,
      biological superiority.

      So, there are different answers. Some groups achieve market
      dominance because of colonial oppression or apartheid. So, for
      example, Whites in South Africa: if a small minority, like the
      Whites in South Africa, Zimbabwe, and Namibia, uses military power
      in a police state to relegate the majority to inferior education and
      apartheid conditions for a hundred years, then that minority is
      going to be a market-dominant minority. When foreign investors come,
      they're going to want to work with this minority that has all the
      capital. It has all the experience, the education. But that's not
      necessarily because of any entrepreneurialism. It's because of
      colonial policies, or divide-and-conquer policies, so minorities
      become market-dominant for reasons having nothing to do with

      The harder cases to explain are the non-colonizer minorities like
      the Indians in East Africa, or the Lebanese in the Caribbean or West
      Africa, the Jews in many parts of the world, and the Chinese in many
      parts of the world. These are groups that often came to their new
      countries with nothing. They were immigrants. The Indians, brought
      to East Africa to work on the railroad, had nothing but a shirt on
      their back. And, yet, these groups in one or two generations came to
      dominate even the professions, or more, in particular, the private
      economy, the commercial sector -- retail, wholesale, corporations.

      I don't answer this question in my book. I think it's a combination
      of reasons. I don't know if you want to call it culture/family
      networks; I think the way networks in all these groups work is very
      striking. It's clearly part of what explains their economic success.

      One case that intrigued me was the case of the oligarchs in post-
      communist Russia. In that case, six of the seven oligarchs turn out
      to be Jewish. But in a way, it's a product of their having been
      excluded before, under the communist system.


      Talk a little about that.

      Well, that's one of the more controversial cases to write about.
      There are so many invidious ethnic stereotypes, and so much anti-
      Semitism, so it's a hard topic to discuss. You hear things
      like "Jews controlling the United States economy." I actually
      researched that and documented that that's false. The U.S. economy
      is not controlled by any ethnic minority, whether it's the Koreans
      or the Jews. It's just not true, if you look at the ten wealthiest
      Americans. Not so in the former Soviet Union. In the anarchic shift
      to capitalism in the early nineties, which, by the way, I think was
      ill-advised -- it was just a fast transition to cowboy capitalism;
      there were no anti-monopoly laws, no anti-insider trading laws --
      but the result of that was that seven men, known as the oligarchs,
      came to control roughly 60 percent of Russia's incredible natural
      resource wealth: oil, nickel, the minerals.

      I wasn't the first to document this. It came out in The New York
      Times magazine and a book called Sale of the Century, by Chrystia
      Freeland. But it was well known in the former Soviet Union. Six out
      of these seven men were Jewish, or at least of Jewish background. I
      did have a lot of research assistants who delved into this question
      of why; they were all students from Russia, many of them Jewish. The
      explanations are partly a result of exclusion. Many of these men,
      the oligarchs, wanted to go into the Soviet Academy of Sciences, but
      were excluded because of anti-Semitic reasons and ended up doing
      other things. Lots of them ended up being very active in the black
      markets during the Soviet era. Now, black market sounds negative,
      but, in fact, everybody loved the black markets during the communist
      era. It was the only place that officials and others could get shoes
      and consumer products. There were shortages everywhere. The black
      market during the Soviet era was essentially the only capitalism
      there was.

      In fact, all of the oligarchs had practice in a private economy, in
      markets. Many of them translated those skills very successfully when
      suddenly, with perestroika, there was market liberalization. Before
      everybody even knew it was going on, they were privatizing, and it
      was a complicated process. But for whatever reasons, these men came
      to the fore, bought up a lot of the things that were for sale, got
      in touch with the foreign investors, and came to control a
      disproportionate amount of the economy.

      That case fits sadly, very neatly into my thesis because you have
      this enormous transfer to markets -- not the kind of markets I think
      we should be promoting -- leading to these seven men controlling 60
      percent of the natural resources.

      But what does democracy do? Sadly, [democracy] and free speech led
      to the emergence of anti-Semitic political parties, politicians that
      were openly campaigning on, "Let's expel the Jews. Let's take back
      their property. The Jews are milking us dry." And that's a pattern
      that we saw in Indonesia around the same time; it's very
      interesting. Free market policies in the 1980s and 90s in Indonesia
      led to a situation where the country's tiny 3 percent Chinese
      minority controlled an astounding 70 percent of the private economy.

      Democratization in 1998, which was hailed with euphoria in the
      United States -- I still remember everybody was so excited about
      democracy in Indonesia -- well, tragically, democracy produced a
      violent backlash against both the Chinese and against markets.
      Politicians in Indonesia fell over themselves campaigning on anti-
      Chinese platforms. You know, "Let's take back the economy." And
      right now, the Indonesian government has nationalized about $58
      billion worth of ethnic Chinese assets. That's part of the reason
      that country is in such an economic crises.

      Before this democratization occurs in many places, what you get is
      an alliance between the economically dominant minority and the
      ruling autocrat. You used the common term "crony capitalism."

      Right. It's an interesting challenge: if you think of the worst
      cases of crony capitalism, you'll be surprised to find that almost
      every one involved a market-dominant ethnic minority. It's a very
      typical pattern for an indigenous dictator, say, Ferdinand Marcos in
      the Philippines. Ferdinand and Imelda were Filipinos, they were
      supposed to represent the majority, but instead, they went into a
      crony capitalist situation with their country's best entrepreneurs,
      who are Chinese. It was this little symbiotic relationship. The
      Marcoses said, "We'll let you make money as long as you kick back
      bribes and profit to us, and we won't have majority rule." That's
      what Suharto did in Indonesia. He had a tiny handful of Chinese
      cronies, who made a huge amount of money, and then kicked it back to
      him. That's what President Daniel Arap Moi did in Kenya. He had a
      very authoritarian little regime propped by a very small handful of
      Lebanese businessmen. The tragic thing about this is, it's a bomb
      waiting to explode. In Indonesia, you have 3 percent of the
      population in cahoots with this hated dictator, while the majority,
      the indigenous Indonesians, are just enraged and so resentful, and
      they feel that they don't have ownership of their country. These
      outsiders are milking it, and there's this horrible dictator.

      So when you politically liberalize, you say it's democracy, [but]
      it's completely understandable, it's almost rational that they would
      vent their anger. This is what happened in Indonesia. Politicians
      speak for the people. They say, "It's time to take back our
      country." The terrible thing is that it doesn't happen often in a
      gradual, stable way. You know, "Let's vote in gradual
      redistributable policies." Instead: "Let's loot the country. Let's
      take back the stores." That's exactly what happened in 1998 -- 5,000
      shops and homes of ethnic Chinese burned and looted on the eve of
      democratization; 2,000 people died and 150 Chinese women were gang-
      raped. The politicians started to campaign on anti-Chinese
      platforms. And the Chinese in Indonesia, the wealthiest, left the
      country, taking with them between $40- and $100 billion.

      Again, that's the piece that the papers don't talk about. [They
      ask], "Why is Indonesia such a breeding ground for terrorists and
      extremist groups, and fundamentalist movements?" Well, partly, it's
      because you have underemployment or unemployment of roughly 40
      million people, and that's because they're sitting on a kind of
      nationalized economy. And it happens over and over.

      So I'm glad you asked the question, my thesis is not about blame.
      I'm not saying that ethnic conflict occurs because of free markets,
      or because of democracy, or because of globalization. I'm a very pro-
      globalization person, and I'm actually in favor or trying to bring
      markets and democracy to other countries around the world. But we
      have been exporting the wrong version of free market democracy. If I
      were to put the blame, I think it's ... You mentioned the crony-
      capitalist situations create these time bombs, so overnight
      democratization leads to this explosive venting. I think we need to
      pay attention to how we democratize and how we bring markets.

      Let's talk about that in a minute and work that out. But one thing I
      want to ask you about, which is that you've talked about a structure
      that's in place across the board all over the world. Once democracy
      comes, political leaders, Milosevic or whoever, have an incentive --
      really an incentive structure -- in place to mobilize the masses
      against this ethnic minority. We often want to look at these places
      and say, "What they've got is evil people," and turn it into a
      theological issue, as opposed to an issue of social and political

      You're exactly right. I have no question in my mind that some of
      them may also be evil. But you're right. Once you start to see the
      pattern, you see that is a matter of incentives. Milosevic in the
      former Yugoslavia, in Serbia: Americans don't like to admit this,
      but he came to power in free and fair elections. He campaigned on an
      anti-Croatian, anti-everything-but-Serbia platform -- "Serbia for
      Serbs." And the Serbs, in light of all their history, which is very
      complex, voted for him. He won on a landslide victory. Now, this is
      not just the Serbs. The Croatians did the same thing. They had
      demagogues in Croatia, too. Tudjman campaigned on an anti-Serbian
      campaign. With Kazakstanis, that political campaign's slogan
      was, "Kazaks stand for the Kazaks." And in Rwanda, without
      suggesting that this is the only thing (it's not just about
      economics at all), but after years of colonialism and divide-and-
      conquer policies in Rwanda, the Tutsis were a 14 percent that had
      always been favored by the colonizers, and they for years had
      dominated the economy. Well, rapid political liberalization, which
      the West was pushing, often with the best of intentions, led to the
      empowerment of the 80 percent Hutu majority. And, sadly, that
      process led ... again, the democratization was all about slogans
      for, "Let's take back the country. It's Hutu power time. Let's get
      rid of these outsider Tutsis." It was not about economic policies
      and building coalitions. It was all about excluding this hated
      minority and taking back the country for the indigenous majority --
      all very artificial.

      You even point out in your book that the argument was weighed not to
      close down the Hutu radio stations because it was a matter of free
      speech. So what should be a functioning democracy becomes something
      else in this context.

      Right. It becomes contorted. And that's right -- in the West, we
      value our free speech. I'm one of the biggest proponents of free
      speech. But in that circumstance, where you had ... again, if it's a
      question of blame, you have to point it to, partly, the colonizers.
      Right? The Belgians played divide-and-conquer. They favored the
      Tutsis. They were the overseers for the 80 percent Hutus.

      So you have all these terrible historical dynamics all bottled up.
      And then suddenly it's, "We want to bring democracy and elections,
      and free speech." And yes, the radio stations were used by the Hutu
      power groups. They used the radio stations to say, "Kill your
      neighbors. Kill the Tutsis." And, sadly, that genocide was majority
      supported. A majority of the people in Rwanda were Hutus -- that's
      80 percent of the population. And as Philip Gourevitch wrote
      beautifully and tragically in his book, "Neighbors killed neighbors.
      Doctors killed patients." It just degenerated. And part of that was
      this sudden political liberalization that the West promoted, with
      the best of intentions.

      Understanding U.S. Myopia
      Your book is beautifully written, very clear. Speaking as a
      political scientist, and you being an attorney, both of our
      professions are into jargon, and there's none of that in this book.
      I was reminded of the Hans Christian Andersen story, The Emperor's
      New Clothes, the young boy saying "The emperor has no clothes." This
      leads me into this question: Why was this brilliant but simple
      argument not more obvious before you laid it out? Why have we -- and
      especially the United States -- failed to comprehend that the very
      good that we're trying to do is such a volatile mix? Why are we so
      bad at seeing what you're talking about?

      It's two things: First of all, the topic of ethnic minorities
      economically controlling sectors feels taboo to people in the West.
      There just seems to be something wrong to talk about that.

      It's not PC.

      It's not PC, so we steer away from it. Lots of times I'll read about
      the same groups I write about and the discussion is just in class
      terms. There's a "disproportionate income inequality," but there's
      no mention that it's the Chinese that control it all. But the more I
      think about this issue, the deeper reason is this: most people in
      the United States, including academics, tend to assume that markets
      and democracy must naturally go together, that they're mutually
      reinforcing. It makes sense if you look at our own society.
      Sometimes people in the United States talk about free market
      democracy like it's one thing. And it's very important to note that
      our social ethnic structure is totally different. We don't have a
      market-dominant minority. For that reason, we have a strong ethic of
      upward mobility.

      My thesis is not just about inequality, because in the United States
      we have a lot of inequality. You know, there have been periods in
      recent history where Bill Gates has owned as much as 40 percent of
      the rest of the American population. But Americans don't hate Bill
      Gates; they want him to be able to make money.

      The reason for this is exactly what I was talking about. Our rich
      people are not an ethnic minority. A poor person in Tennessee or
      Arkansas can say, "I'm not wealthy, but maybe my son or my daughter
      can grow up to be Bill Gates, or Bill Clinton." That's absolutely
      not true in countries like Zimbabwe, or Burma, or Indonesia, or
      Bolivia, where the majority of the people look around and they
      say, "Everybody who's rich belongs to a different ethnic group."

      And as a thought experiment -- this is how I start my book -- I
      say, "Imagine if Bill Gates and the ten wealthiest people in the
      United States were all ... " just pick a minority -- they were all
      Arab, or they were all Chinese -- "and picture at the same time that
      the [ethnic] majority lived in entrenched poverty and experienced no
      upward mobility for generations." That's the dynamic that you have
      in most of the developing world. I think it's really hard for people
      in the West, particularly Americans, to imagine a system so
      different from ours, because we feel like everybody can make it.
      It's a very strong ... I don't know if it's a dream or a myth, but
      it's partly substantiated that anybody can make it in this country.
      There are enough success stories for that to be believed. That's the
      reason that there's this assumption that free markets and democracy
      go together all the time.

      Our own founding fathers were very aware that markets and democracy
      might not go together. That's why we didn't have universal suffrage
      [at first]. If you go back and look at the Federalist Papers and the
      debates around the time -- Adam Smith and David Riccardo, all the
      people that we admire -- Thomas Jefferson -- all debating these
      things, and they were all saying, "We'd better not let the poor vote
      right now, because they don't own property, and they're just going
      to vote to confiscate the wealth of the rich." So we, actually, had
      property exclusions. We disenfranchised lots of groups. That's
      another part of the picture. We forget our own history.

      In fact, we built a governmental structure that emphasizes checks
      and balances.

      Right. We have very complicated checks and balances, separation of
      powers. Democracy in the United States, or anywhere in the West, is
      not just overnight majority rule. It's about a lot of other things,
      for better or for worse.

      You talk about the emphasis on doing things rather quickly; that is,
      bringing markets to underdeveloped places and having a timetable
      that says, "Let's do it with a big bang." And the same with
      democracy. How do you account for that? Is it that we often want to
      get out rather quickly? That seems to be the case in Iraq, that we
      don't want to give the time for evolution, it's not on the agenda.
      That is the key to all of this history you were just talking about.

      I think that's right. It goes back to the fall of the Berlin Wall
      and the death of communism. The former Soviet Union collapses, and
      it seemed clear to a lot of people that communism is dead. We don't
      want a dictatorship, so the only thing left is free market
      democracy. So in that feeling of euphoria, right after 1989, the
      idea was to bring markets and democracy as fast as we could to
      everybody, because obviously that's the right thing. People didn't
      pay attention to the tension between them, and again, as you say,
      democracy and markets is the way we did it in the West.

      On the market side, it was just absurd. Dropping -- practically
      airlifting! -- stock exchanges into Mozambique and Tanzania, and
      Xeroxing our foreign investment laws, and privatizing everything,
      very naively ... I mean, I'm actually an optimist, because I think
      we did things so badly during that stage that now in the law, in
      political science, people are saying, "Along with bringing
      privatization and free markets, we need to have anti-fraud laws. We
      need anti-insider trading legislation." None of that was thought
      about in the initial phases of the free market euphoria.

      On the democracy side, I think it's much tougher. I do think there
      was the same kind of naiveté, which is, let's just have elections.
      That brought Slobodan Milosevic to power. It brought Hugo Chavez to
      power in Venezuela; there were free and fair elections, for better
      or for worse. I think part of it was naiveté, which is, "elections
      have got to be good; majority rule; we need universal suffrage."

      Part of it is the other thing you mentioned. When it gets tough
      then, often we find ourselves taking things back. We find ourselves
      backpedaling. We tell people to have elections, and then we suddenly
      realize who might be elected, and then there's a lot of backpedaling
      and stalling that, sadly, leads to more resentment against the
      United States, because then you get charges of hypocrisy and self-
      interest. And there may be some of that; it depends on the case. But
      in the United States, we're so isolated. There's a tendency and
      arrogance to assume that other countries are just like us, so let's
      prescribe what worked for us.

      Policy Implications
      What are the policy implications of your theory? What should the
      West should do differently in these places?

      Well, again, I'm a big fan of trying to promote markets and
      democracy globally. There are others who are not. Americans can be
      very fickle. There is a new movement, an anti-democracy movement --
      I associate this with Robert Kaplan, whose work I think is very
      interesting, and Samuel Huntington -- that says that maybe these
      countries aren't ready for democracy; let's put in markets first.
      I'm not in that camp. I take it very seriously. I think sometimes,
      in some cases, they could be right. But I am not in that camp for
      the simple reason that I can't figure out how to ensure that you get
      a beneficent dictator.

      You can ask for Lee Kuan Yew [of Singapore], and you could get Idi
      Amin or Saddam Hussein instead. I think we have to work to bring
      markets and democracy, but we've been doing a ridiculous job. There
      is no Western nation today with anything close to a laissez-faire
      capitalist system, and yet that's what we were doing for the last
      twenty years, telling everybody to adopt a raw capitalism with no
      safety nets, no redistributive mechanisms.

      On the positive side, I think we have to find ways to spread the
      benefits of global markets beyond just the small group of market-
      dominant minorities and foreign investors. We need to find ways to
      redistribute the wealth, whether it's property title and giving poor
      people property, land reform .... Redistributive mechanisms are
      tough to have if you have so much corruption.

      I discuss, not just wildly and enthusiastically, but there
      are "affirmative action" policies for the majority. It shouldn't be
      called affirmative action, but Malaysia and South Africa are
      exploring or have programs to try to spread the wealth to their
      majorities. There are a lot of economic costs to that. It's
      certainly not that efficient. You're going to lose some growth, but
      I think it might be the better way. At least, markets might be
      sustainable. It's more stable. So I advocate ways to spread the
      wealth, and I also ask for voluntary generosity on the part of the
      successful market dominant minorities.

      So that they should think about the implications of where they stand
      in the system and how they might alter some policies to have
      redistributive consequences?

      Yes, and also to just realize that their own safety and their own
      interests are at stake. A lot of times these market-dominant
      minorities, whether you're talking about Chinese in Southeast Asia,
      or the Lebanese in West Africa, or the Whites in South Africa, it's
      almost a feeling of invincibility. "We're so wealthy, we control
      everything." They forget that they're surrounded by a justifiably
      frustrated, very poor majority. And so I say, "Look at your own

      It costs money to hire bodyguards. All of my own relatives have
      bodyguards and barb-wired fences. Why not risk some of the money?
      Build a school. Build a hospital. Build infrastructure and try to
      fight against the image that you have of being an outsider.
      Demagogic politicians manipulate that [image]. They say, "These
      groups are outsiders; they're taking away our wealth" -- even if the
      groups have been there for four generations. So why not do some
      economic good? Show that you're a team player, a part of the country.

      I make an analogy in the book to the United States at the global
      level. Most of my book is about individual countries, but at the end
      of my book I make an analogy -- it's a bit of a jump -- and I
      say, "At the global level, at the world level, the United States
      itself has come to be perceived as a kind of global market-dominate
      minority, wielding widely disproportionate power and economic wealth
      relative to our numbers." The numbers are similar: we're just 4
      percent of the world's population. We are seen everywhere as the
      principal engine and the principal beneficiary of global capitalism.

      In part, not totally true, but in part, for our extraordinary market
      dominance, we have earned the envy and fear and hatred of much of
      the rest of the world. So in the same way, I say it's in the United
      States' self-interest to see how we're perceived, and not just to
      say "We earned it," which may be true. To say, "Let's try to give
      back to the international economy and try to look more like a global
      team player." I think it's better for our own interest.

      You have put together in a distinctive way ethnicity, democracy, and
      capitalism to make a very clear argument about the world and the way
      it is that goes against conventional wisdom. What are your thoughts
      about that? I mean, it all seems to come together so that you're
      able to talk self-confidently about ethnicity in a way that
      transcends a PC dialogue, which wouldn't allow you to.

      That's interesting. I'm lucky in a strange way. I mean, there are
      costs, too; but being an outsider -- a person from a different
      background -- has allowed me to see this phenomenon, which is all
      about outsiders in these societies. Because I am ethnic Chinese,
      maybe it's easier for me to talk about the economic dominance of the
      ethnic Chinese in Southeast Asia. Of course, it might be more
      difficult for somebody else talking about that. But you're exactly
      right, that the conventional wisdom, certainly starting in 1989, was
      that markets and democracy are going to work hand-in-hand to bring
      peace and prosperity to the whole world, and that in the process,
      ethnic hatred and ethnic divisions and religious hatred -- all these
      things -- would be washed away.

      Thomas Friedman was an eloquent voice propounding this view that
      markets are going to turn everybody into consumers and competitors,
      and that all this ethnic stuff is just going to be swept away.
      Sadly, if you look at the world, if you look at the last fifteen
      years since 1989, something very different has happened. Since 1989
      we've seen the proliferation of ethnic conflict. We've seen growing
      fundamentalism, anti-Americanism, and extremism. We've seen
      confiscations, calls everywhere for renationalization, and two
      genocides of magnitudes unprecedented since the Nazi Holocaust. So I
      think it's clear that something has gone wrong, and that the
      relationship between markets, democracy, and ethnic conflict is not
      as simple as we'd like to hope.

      What would be your advice to students who are intrigued by this set
      of problems and have to navigate the issues of modernization, law,
      and democracy on the one hand and ethnicity on the other, and move
      into the future of putting those together?

      The best hope lies in education, both in developing countries and in
      the United States. Within the United States, it's so important for
      us to be more international. I guess we're privileged to speak only
      English and to know only about our country -- not to know what the
      difference is between Iraq and Iran [for example] -- I mean, most
      people just don't know! It's not a blame issue, but it's partly
      because of our geographic isolation, our own history. I think,
      first, just knowing more about the rest of the world, about other
      cultures and how they differ, is the first step.

      Secondly, in thinking about how to bring free markets and
      development to the other countries of the world, and how to bring
      democracy, tailoring those policies to the local conditions. You
      need to figure out other societies, where they came from, what the
      people believe in, what they do, how their ethnic divisions work,
      which is often very different from our own; then design your
      policies around that. Pay attention. I think that's the simple
      answer, which is just to realize that not everybody is like the
      United States. Whether you study history or sociology, or
      anthropology, journalism, there's room for seeing there are other
      cultures and other ways and other structures.

      Amy, on that positive note, I want to thank you very much for
      joining us today and talking about your intellectual odyssey and
      your new book.

      Thank you so much for having me. It was really a pleasure.

      And thank you very much for joining us for this Conversation with


      "World On Fire" by Amy Chua
      A new book argues that when Third World countries embrace democracy
      and free markets too quickly, ethnic hatred and even genocide can
      By Michelle Goldberg

      Jan. 13, 2003 | The case Amy Chua makes in "World On Fire: How
      Exporting Free Market Democracy Breeds Ethnic Hatred and Global
      Instability" is so clear and persuasive it almost seems as if it had
      been obvious all along. Yet her argument, that rapid switches to
      majoritarian rule and free-market democracy in many Third World
      countries benefit certain ethnic groups over others and lead to
      vicious sectarian strife, is quite new, if occasionally overstated.
      Writers such as Robert Kaplan have long argued that the Western
      obsession with exporting democracy to countries without the
      institutions to support it is naive and often dangerous, fostering
      demagogues and communal hatreds. Chua builds on this argument in an
      essential way, showing how expanding markets exacerbate the problem
      by enriching already-dominant minority groups even as democracy
      empowers angry majorities.

      "World On Fire" is about a phenomenon Chua calls "market-dominant
      minorities," groups like the Chinese in Southeast Asia, Jews in
      Russia, whites in Zimbabwe and Indians in East Africa and Fiji.
      Market-dominant minorities control hugely disproportionate
      percentages of their countries' resources. Filipino Chinese comprise
      just 1 to 2 percent of the Philippines' population, but control all
      of the country's major supermarkets, fast-food restaurants and large
      department stores, and all but one of the nation's banks. A similar
      situation obtains in Indonesia. Jews make up a similarly tiny
      proportion of Russia's population, but of the seven "oligarchs" who
      control virtually all of the country's business, six are Jewish.
      Lebanese dominate the economies in Sierra Leone and Gambia, while
      Indians dominate the economy in Kenya, along with a smaller,
      indigenous minority tribe called the Kikuyu. Similar examples abound

      It's enormously touchy to talk about the economic element of
      communal violence, especially regarding Jews, since rhetoric about
      one ethnic group exploiting another is so often a precursor to
      atrocity. But that's exactly why Chua's book feels so urgent. No
      matter how politically incorrect it is to talk about, her book makes
      clear that minority market domination is a reality in much of the
      world, one that's tied up in many ways with smoldering group hatreds
      and explosions of mass slaughter, and one that's made worse by
      Western policies.

      Chua, a professor at Yale Law School, is a careful, precise writer,
      and she makes it very clear that she's not blaming prosperous ethnic
      groups for violence directed against them, or blaming capitalism
      alone for fomenting genocide. It's a point she makes over and over
      again. (Her lawyerly penchant for summing up and reiterating her
      main arguments far too many times is the book's greatest flaw.)

      "The point, rather, is this," she writes. "In the numerous countries
      around the world that have pervasive poverty and a market-dominant
      minority, democracy and markets -- at least in the form in which
      they are currently being promoted -- can proceed only in deep
      tension with each other. In such conditions, the combined pursuit of
      free markets and democratization has repeatedly catalyzed ethnic
      conflict in highly predictable ways. This has been the sobering
      lesson of globalization in the last twenty years."

      Nevertheless, "World On Fire" is not an anti-globalization screed.
      Chua is a former Wall Street lawyer who worked to help developing
      countries privatize their resources, and she continues to believe
      that, in the long term, markets offer the best hope for developing
      countries. Her scathing assessment of the way the West has foisted
      liberalization on the rest of the world is driven not by ideology,
      but by a careful examination of globalization's unintended

      "Back in the early nineties," she writes, "I believed that the
      proceeds of privatization, as a World Bank official put it, would go
      to roads, 'potable water, sewerage, hospitals, and education to the
      poor.' Like many in the 1990s, however, I was viewing emerging
      market privatization through a rose-colored lens." Later, she
      adds, "Even assuming that free market democracy is the optimal end
      point for most non-Western countries, in the short run markets and
      democracy are themselves part of the problem."

      Explaining why market-dominant minorities exist would probably
      require another volume, and Chua makes only a cursory attempt to do
      so. In some cases, of course, it's obvious -- the white minority in
      South Africa and Zimbabwe accumulated capital and expertise at the
      expense of the grotesquely exploited majority, who cannot now catch
      up without massive government help. Elsewhere group prosperity is
      attributable to superior business networks. Cameroon's Bamileke, for
      example, "operate an informal capital market so efficient it
      constantly threatens to put government-owned banks out of business,"
      Chua writes. The reasons for Jewish economic success are more
      mysterious -- especially in Russia, where they've been repeatedly
      subjected to vicious pogroms -- and "World On Fire" does little to
      illuminate them. Chua is less interested in how minority groups come
      to dominate than what happens when they do.

      She argues that when economic liberalization and democracy are
      rapidly introduced to countries with market-dominant minorities, the
      two forces necessarily come into conflict. "Markets concentrate
      enormous wealth in the hands of an 'outsider' minority, fomenting
      ethnic envy and hatred among often chronically poor majorities," she
      writes. "Introducing democracy in these circumstances does not
      transform voters into open-minded cocitizens in a national
      community. Rather, the competition for votes fosters the emergence
      of demagogues who scapegoat the resented minority and foment active
      ethnonationalist movements demanding that the country's wealth and
      identity be reclaimed by the 'true owners of the nation.'"

      In Indonesia, for example, free-market policies undertaken under
      Gen. Suharto, the U.S.-backed dictator, vastly enriched the
      country's tiny Chinese minority, who in turn supported the
      strongman. By 1998, Chua writes, Chinese made up 3 percent of the
      population but controlled 70 percent of the private economy. That
      was the year democracy protests and riots forced Suharto to resign.
      His fall was accompanied by orgies of anti-Chinese violence --
      Chinese women began wearing "anti-rape corsets," locked steel
      chastity belts. "[T]he prevailing view among the pribumi majority
      was that it was 'worthwhile to lose 10 years of growth to get rid of
      the Chinese problem once and for all,'" she writes. "Meanwhile, the
      U.S. State Department called resoundingly for free markets and
      democratic elections."

      Many other countries share elements of this dynamic, though Chua
      sometimes seems to be stretching her thesis in order to fit in as
      many places as possible. She's overreaching somewhat when she says,
      early on, "markets and democracy were among the causes of both the
      Rwandan and Yugoslavian genocides." Clearly democracy was a factor
      in both, but the economic factors are much trickier. The gap in
      status between minority Tutsis and majority Hutus is indeed
      attributable to globalization, but of the old-fashioned, colonial
      kind -- Belgian colonizers favored minority Tutsis over majority
      Hutus because of what was seen as their Caucasian-like features. And
      while Serbian hatred of the Croats was fanned by Croatian economic
      dominance, the Bosnians they butchered were as poor as they were.
      Chua makes these caveats herself in the relevant chapters, but they
      dilute some of the grand claims she lays out in her introduction.

      Still, her larger point, that the policies seen as panaceas by the
      West can actually make things worse, holds true. Electoral democracy
      is often touted as an antidote to the tyranny and tribalism ravaging
      much of the globe. "For globalization's enthusiasts, the cure for
      group hatred and ethnic violence around the world is
      straightforward: more markets and more democracy," Chua writes. She
      notes that after Sept. 11, Thomas Friedman wrote of the Middle
      East, "Hello? Hello? There's a message here. It's democracy, stupid!
      Multi-ethnic, pluralistic, free-market democracy."

      This one-size-fits-all prescription for curing the world's ills is
      implicated in the Rwandan genocide of 1994. As Chua writes, Hutu
      dictator Juvénal Habyarimana, who ruled from 1973 until the early
      1990s, may have been corrupt and totalitarian, but he did protect
      the Tutsi population. Once he responded to Western -- particularly
      French -- calls to adopt multiparty democracy, though, Hutu
      supremacy became a potent weapon for Habyarimana's political
      enemies. The genocidal Hutu Power movement was buoyed on a
      groundswell of popular support. Meanwhile, Chua points out,
      the "freedom of the press" encouraged by the West stopped the
      government from shutting down the hugely influential, rabidly anti-
      Tutsi newspaper Kangura.

      "Sudden political liberalization in the 1990s unleashed long-
      suppressed ethnic resentments, directly spawning Hutu Power as a
      potent political force," Chua writes.

      The idea that democracy, America's most cherished value, has
      exacerbated the last century's bloodletting is terrible to
      contemplate. Yet Chua's book ultimately supplies a tiny measure of
      hope. Unlike Kaplan, Chua doesn't believe that enlightened autocracy
      is the answer for the developing world. For her, the problem isn't
      democracy itself but the speed at which it's implemented. Rushing
      it, especially without protections for individual rights or
      institutions for upholding the law, can be dangerous.

      Kaplan believes that the right kind of despots can sustain a stable
      environment for capitalism to flourish, creating the middle-class
      institutions necessary to sustain democracy. One of his models is
      prosperous, undemocratic Singapore. Chua's analysis, though, shows
      us that no amount of economic growth will turn countries that have
      market-dominant minorities, like Indonesia, into countries like
      Singapore, that don't. Prosperity and stability won't come to those
      countries until they find a way to narrow the chasm between rich
      minorities and poor majorities.

      To that end, Chua argues for sweeping reforms that would give
      disenfranchised populations a stake in their nation's resources, as
      well as massive affirmative-action policies of the kind being
      undertaken in South Africa and, with notable success, in Malaysia.
      Such a policy is a huge departure from the free-market evangelism of
      people like Thomas Friedman, but one more likely to lead to
      prosperous societies that can, eventually, turn into real

      Of course, it's not terribly likely that her recommendations are
      going to be implemented in most places anytime soon. In the
      end, "World On Fire" is valuable less for its prescriptions than for
      the perspective it offers on the seemingly incomprehensible violence
      shaking the world. With the fall of communism and the emergence of
      al-Qaida, it's no longer fashionable to see ethnic conflict in
      materialist terms -- the new battles are framed as a clash of
      civilizations rather than a scramble for resources. It's a scarier
      opposition, because it's so intractably defiant of reason. "World on
      Fire" suggests these conflicts might not be so primordial and
      irrational after all. It might be cold comfort to realize how
      atavistic enmities abroad have been inflamed by our own government's
      policies, but at least these policies can, ultimately, still be


      AMY CHUA
      TCG National Conference, June 13, 2003

      AMY CHUA: It's wonderful to be here this morning. Thank you all for
      getting up and coming. I should say that people in my own field,
      which is law, tend to talk mostly only to each other, so I find it
      truly admirable that theatre leaders, like yourselves, want to
      engage in conversations with people from other disciplines and, as
      Joan mentioned, that your frame of reference encompasses global as
      well as national perspectives. I think that, given where we are in
      the world today, this could not be more important. But I am just
      delighted and really honored to be part of your conference this
      year. I would also like to give a special thanks to the board of
      directors and the staff of TCG for inviting me and for organizing
      this talk.

      As coached, my plan is to speak for about 30 or 40 minutes and, what
      I think I'll do, is I'll just start by presenting the main thesis of
      my book, and I'll try to illustrate that thesis with specific
      examples from countries all over the world, ranging from Indonesia
      to Venezuela to Sierra Leone. I'll then shift my focus to the United
      States and say a little bit about how I think we fit into this
      picture and, in particular, I'll say something about the
      implications of my analysis for the challenge to reconstruct Post-
      war Iraq. And then we'll open things up for questions.

      So, let me begin by taking you back to 1989: the fall of the Berlin
      Wall, the death of communism. As you may remember, a kind of
      consensus—really, a triumphal consensus—emerged at that time, not
      only in the United States, but, to a considerable extent, around the
      world. And that consensus was that markets and democracy, working
      hand in hand, would transform the world into a community of
      modernized, productive, peace-loving nations.

      In the process, ethnic hatred, religious zealotry and other backward
      aspects of underdevelopment would be swept away. Unfortunately, if
      you look at the last 15 years, something very different has
      happened. Since 1989, we have seen the proliferation of ethnic
      conflict, intensifying nationalism, fundamentalism and anti-
      Americanism, confiscations, expulsions, calls for re-nationalization
      and two genocides of magnitudes unprecedented since the Nazi

      Why? What happened?

      Part of the answer, I think, lies in the relationship and,
      increasingly, the explosive collision between what I think are the
      three most powerful forces operating in the world today: markets,
      democracy and ethnic hatred. And the main point I want to make this
      morning is that contrary to conventional wisdom is that markets and
      democracy, at least in the raw form that they're currently being
      promoted, may not be mutually reinforcing in the developing world.
      On the contrary, in many non-Western countries, markets and
      democracy may be on a collision course.

      And the reason for this has to do with a phenomenon that is
      absolutely pervasive outside the West, and yet almost never
      acknowledged—in fact, viewed as taboo and not politically cor<br/><br/>(Message over 64 KB, truncated)
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