Wednesday, June 25, 2003

BOOK REVIEW: "World on Fire: How Exporting Free Market Democracy Breeds Ethnic Hatred and Global Instability", by Amy Chua, Doubleday, 2003.

Review by Wayne Lusvardi

The highly acclaimed recent book on globalization by Amy Chua, "World On Fire: How Exporting Free Market Democracy Breeds Ethnic Hatred and Global Instability" (Doubleday, 2003) has resulted in widely divergent opinions between the scholarly and media pundits and the layperson's online reviews of the book. Randall Kennedy of the Harvard Law School has called the book a "tour de force." Former Clinton Administration diplomat Strobe Talbott has stated the book is "powerfully argued" and an "important contribution." Conservative professor of economics Thomas Sowell has called the book "a landmark achievement." Even the free market Ludwig von Mises Institute posted an approving article of the book's stance against the blind exportation of democracy in developing nations. However, many reviews at have been less praiseworthy, if not outright critical. When there is such disagreement between the man-in-the street and the experts, this reviewer is reminded of sociologist Peter L. Berger's apt observation that the difficult thing to understand about globalization is not Islamic mullahs, nor the views of the "average American Joe," but those of American University Professors.

The thesis of "World on Fire" is that the disproportionate economic success attained by "market dominant minorities" in third-world nations foments ethnic hatred and genocide. Democracy, coupled with capitalism, provides the catalyst that paradoxically sparks the backlash of "indigenous majorities" against wealthy ethnic minorities. Chua starts out her book by poignantly relating the tragic story of the ethnic envy murder of her wealthy Chinese aunt at the hands of her Philippine chauffer. She then proceeds to develop a whole framework from this case about the economic dominance and the resulting backlash against the Chinese in Asia, Croatians over Serbians in the former Yugoslavia, White Europeans in South Africa, Tutsis over the Hutus in Rwanda, and Jews in the former communist Russia and Israel. According to Chua, the concoction that makes up such ethnic conflicts is "free market democracy" and "laissez faire capitalism." Chua contends that markets exacerbate ethnic conflicts by enriching already dominant minority groups while democracy empowers angry majorities.

Amy Chua, professor of law at Yale University, holds a B.A. in economics, Magna Cum Laude, Harvard University, a J.D., Harvard Law School, and has held professorships at Duke, Columbia, Stanford, and NYU, before becoming a professor at Yale Law School. She clerked for a U.S. Court of Appeals judge, worked four years at a Wall Street law firm, did a stint at the World Bank, and helped privatize the Telefonos de Mexico. She is the offspring of one of the market dominant minorities she discusses in her book, the Chinese commercial class of the Philippines.

Perhaps one of the most astute observers of globalization is sociologist Peter L. Berger who has pointed out that there are "four faces," or carriers, of global culture: (1) the Davos culture comprised of world-traveling business elites (i.e., Davos, Switzerland); (2) the Faculty Club Culture of elite American schools; (3) the McWorld Culture of popular food, music, and fashion spreading around the world; and (4) Evangelical Protestantism (see Peter L. Berger, "The Four Faces of Global Culture," National Interest, Fall 1997, Issue 49). Clearly, Chua's views come out of the Faculty Club Culture of the American university.

Chua is mostly right about the exportation of American majoritarian democracy into developing nations, but has got it wrong about markets and globalization. Nonetheless, "World On Fire" throws water on those neo-liberals want to export democracy to the Third World (Thomas Friedman's "The Lexus and the Olive Tree", 2000) and neo-conservatives that want to export their version of American monopolies and duopolies into modernizing nations.

Chua joins a recent chorus of authors who have issued warnings about the dangerousness of democracy in the developing world, including Robert Kaplan ("The Coming Anarchy", 2000), Fareed Zakaria ("The Future of Freedom: Illiberal Democracy at Home and Abroad", 2003), and Hans Hermann-Hoppe ("Democracy: The God That Failed", 2001). Despite reviewers' claims that Chua "writes with an authority born of rigorous research" (Business Week Online) she never so much as mentions those thinkers such as James Madison and Alexis de Tocqueville who warned of the dangers of the excesses of majoritarian democracy and ethnic conflicts some 200 years before her book. Chua may be unaware that James Madison even addressed the ethnic conflict of the "American Indians" in light of the U.S. Constitution.

Curiously, Chua, a professor of international law, glosses over the importance of the rule of law and property rights in economic development. Chua fails to see that the brand of egalitarian democracy, or kleptocracy, that she advocates will only end up devouring itself just as communism imploded. As Hernando de Soto ("The Mystery of Capital: Why Capitalism Triumphs in the West and Fails Everywhere Else", 2000) and Brink Lindsey ("Against the Dead Hand: The Uncertain Struggle for Global Capitalism", 2001) have both pointed out, without the rule of law to create and protect property rights, globalization is likely to fail. Chua, herself a member of the "New Class" of lawyers and knowledge elites, casts a blind eye to the fact that the type of egalitarian state she advocates results in a wealthy class of lawyers, instead of an ethnic group, as the new privileged elites of wealth redistribution. As sociologist Peter L. Berger has written, the new "knowledge class" in Western societies is a major antagonist to capitalism, due in part that this class finds employment and subsidization in the welfare state.

Greater scrutiny should be given to the claims of book reviewers that Chua's "argument is quite new" (Salon), and "gets everyone thinking in a new way" (Publisher Doubleday). All of the praise for World On Fire miss that the thesis of the book is highly unoriginal and was addressed by the infamous Karl Marx and Friedrich Engels over 150 years ago when the First World was undergoing a similar wave of industrialization. Substitute such terms as "bourgeoise" for Chua's "market dominant minority," "the proletariat" for Chua's "the poor," "control over the mode of production" for "market dominance," "ethnic conflict" for the "Jewish Question," and "backlash" for "dialectical conflict" and you have a new lexicon of Marxism. It would be totally unfair to label Chua as a Marxist communist or revolutionist. But her diagnosis (or shall we say "dialectic") is nearly identical. With the impeccable credentials of Chua one can only wonder how she wrote a book paralleling Marxist diagnostics so closely without even once citing Marx in her book?

Space prevents elaboration, but let's take for one instance Marx's notion of "control over the means of mental production" and Chua's concept of "ethnic dominance:"

Marx - "Control Over the Means of Mental Production."

"The ideas of the ruling class are in every epoch the ruling ideas: i.e., the class which is the ruling material force of society, is at the same time its ruling intellectual force. The class which as the means of material production at its disposal, has control at the same time over the means of mental production, so that thereby, generally speaking, the ideas of those who lack the means of mention production are subject to it."

Chua - "Market Dominant Minorities"

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_In societies with a market-dominant ethnic minority, markets and democracy favor not just different people, or different classes, but different ethnic groups_There was also the time that the U.S. government hired New York-based Burson-Marsteller, the world's largest public relations firm, to help sell free market capitalism to the people of Kazakhstan. Among other ideas, Burson-Marsteller developed a television soap opera mini-series glorifying privatization. In one episode, two hapless families desperately want a new house but don't know how to build it. Suddenly, a hot air balloon descends from the sky, bearing the name "Soros Foundation" in huge letters. Americans spring out, erect the house, and soar away, leaving the awe-struck Kazakhstanis cheering wildly." ("World On Fire", 2003: 6-8).

Chua's supposition that ethnic hatreds are market driven is a repetition of 19th Century Marxist economic determinism. But man doesn't live by bread alone. The missing dimension in Chua's book is what social scientists call "legitimation" -- which means that democratic societies are held together not simply by needs and interests, but by the voluntary assent of the governed and limited government that respects property rights.

Chua's use of the term "market" is a misnomer. The term "market dominating minority" is used by Chua to mean the converse of a market: a cartel, a cabal, a monopoly, and a ruling class. By definition, a market implies choice, competition, and a breakdown of identification along ethnic, religious, or racial lines. As historian Jerry Z. Muller aptly concludes in his magisterial recent book, "The Mind and the Market: Capitalism in Modern European Thought" (2002:406):

"_a capitalist society is one in which the polarity between ethnic, religious, or racial "insiders" and "outsiders" becomes ever more difficult to define and defend. The notion of offering favorable treatment to insiders becomes less acceptable_The more different the butcher, baker, and brewer appear to us, the more we appeal to their self-interest rather than to their identification with our own interests. But the more we regard ethnicity, race, religion, or nationality of the butcher, baker, and brewer as irrelevant to our self-interest, the more likely we are to include them within the circle of our commercial intercourse."

Given Amy Chua's pedigrees, I rather doubt that she is unaware that the position she takes in her book is neo-marxist (with a small "m"), although she vigorously denies that she embraces such. Ironically, Chua's call for more egalitarian wealth sharing among nations may reflect the same sort of elitism that she criticizes. As John M. Ellis has written in "Literature Lost: Social Agendas and the Corruption of the Humanities" (Yale University, 1997):

"Oddly enough, it is the intellectual snobbery and elitism of many of the literati that politically correct egalitarianism appeals to; their partiality to literary Marxism is based on its economic theory but on its hostility to business and the middle class. The character of this anti-bourgeois sentiment therefore has more in common with its aristocratic disdain for the lower orders than with egalitarianism."
Chua's premise that globalization has worsened inequality is a mere social construction that is ignorant of the empirical facts. As Surjit Bhalla has definitively shown in "Imagine There's No Country: Poverty, Inequality, and Growth in the Era of Globalization" (2002), for the period 1960 to 1980 Latin America and sub-Saharan Africa reflected high inequality and no growth while Asia evinced a pattern of high growth and low inequality. Bhalla concludes that much of the conventional wisdom about globalization and poverty is wrong. Contra Chua, he reveals that globalization has reduced absolute poverty levels and has been good for the poor.

Despite the constant denials in her book that she is not against democracy, globalization, or markets, Chua is an economic determinist and is either an unwitting or a very clever "literary Marxist." She would replace both totalitarian rulers and ethnic commercial elites with a "New Knowledge Class" of redistributionist lawyers in an egalitarian state.

"World On Fire" is less of a book on globalization or social science as it is an incendiary device, or what arson investigators call an "accelerant," that throws fuel onto the fires of the global culture wars.

Wayne C. Lusvardi ( works for a large government utility agency in Southern California. He is co-founder of the Bastilatland Institute ( His articles have appeared in the University of Southern California online Journal of Planning and Markets, Real Estate Issues, Real Estate Review, Appraisal Journal, Public Utilities Fortnightly, and the Environmental Claims Journal.

Saturday, June 21, 2003



This is an excerpt from an article in the Brisbane “Courier Mail” of 22 Jun, 2003, p. 84 which does not appear to be available online

THE Brisbane parents of a peace activist are proud of their son but worried he may be facing a jail term in Ireland. On Tuesday, Ciaron O'Reilly, 43, will stand trial with four others on criminal damage charges arising out of the disabling of a US Navy aircraft during an anti-Iraqi war protest at Dublin's Shannon Airport in February.

Mary O'Reilly, 72, and her husband Garrett, 75, said their devout Christian son had dedicated his life to peace and they fully supported him. While Mrs O'Reilly could not help feeling a mother's anxiety for her second son, she said: "I've just accepted that this is going to be the way it is. She admitted that friends and others in Brisbane who had seen their dreadlocked son in protests over the years did not understand why he had turned his back on a teaching career to live a life of poverty and protest.

Mr O'Reilly said he was disgusted that, in a supposedly neutral country like Ireland, US planes destined for the war in Iraq were allowed to refuel at Dublin's Shannon Airport. He said he understood his son's protest action. "All of us admire martyrs. We wouldn't want him any other way," he said.

Ciaron was involved in the protest movement from the time he was in Year 12 and Mrs O'Reilly remembers seeing him standing on a soapbox in the Queen St Mall in the 1980s speaking to the crowds.

In 1991 Ciaron spent 13 months in prison in the United States for destroying and conspiring to damage US Government property, after damaging a B-52 bomber in New York with other members of the ANZUS Ploughshares group during a Gulf War protest.

Note that part of the act of this attention-seeker is to wear his hair in dreadlocks, although he is neither Jamaican nor of African ancestry

Friday, June 20, 2003

Pro-lifer pays pair $1000 for baby

By Leanne Edmistone

A BRISBANE husband and wife were paid S1000 by a prolife protester to have their baby rather than go through with an abortion. The middle-aged couple, who already have a family and had decided to terminate their unexpected pregnancy, were approached by an individual protester outside the Marie Stopes International clinic in Salisbury, in Brisbane's west, late last month. They later decided to take the money to help ease their financial difficulties. The couple had also reportedly been offered further payments.

Children By Choice coordinator Cait Calcutt and Marie Stopes International Australia general manager Suzanne Dvorak yesterday criticised the offer as appalling. inappropriate and a cynical tactic designed to take advantage of some people's financial desperation. She said security had been upgraded at all their clinics and Salisbury police had been informed about the incident.

Ms Calcutt said the woman, who had been a client of her family counselling service, was very angry at what she felt was an inappropriate offer and reported it to the service, but still felt pressured to take the money.

A Queensland Right to Life spokeswoman yesterday said their supporters did not protest or approach people outside clinics but applauded the cash offer.

The above is an excerpt from an article that appeared in the Brisbane “Courier Mail” on June, 19, 2003 (p. 3) but which does not appear to be available online

Wednesday, June 18, 2003

Why do New Labour hate the English?

Excerpts from The Sun of 17th June, 2003

Frankly, the abolition of the post of Lord Chancellor doesn't unduly bother me. Except that Blair hasn't actually abolished it. He's given the job to his old flatmate Charlie Falconer, with knobs on.

Why do we need a department of constitutional affairs when we don't have a constitution, despite Blair's best efforts to foist one upon us from Europe?

We certainly don't need a whole new tier of government in the shape of English regional assemblies, packed with placemen and serviced by legions of useless Guardian readers. We've got too much government already. What we need is less, not more.

And the idea that people in the north of England can have a referendum on how their regions are run, but the country will not be allowed a vote on whether we want to be governed by unrepresentative foreigners, is insulting and an affront to democracy.

But, as I've argued before, Blair isn't a proper democrat in the true sense of the word. The ballot box is just one arrow in his quiver. Representative government isn't something he cares two hoots about.

Already, the people of England are governed by politicians we can't remove. The appointment of John Reid as health secretary only serves to compound the offence.

Reid will take decisions about the NHS in England, but will have no responsibility for health in his own constituency in Scotland. That comes under the Scottish parliament.

Charlie Falconer takes over as the senior law officer, but his writ will not run in his homeland. Scotland has a separate legal system.

Reid and Falconer are among six senior ministers who will never have to answer to English voters.

Gordon Brown, Douglas Alexander and Alistair Darling all sit for Scottish constituencies. So does the Speaker Mick Martin.

Paul Murphy, the Northern Ireland secretary, and Peter Hain, the preposterous perma-tanned new Leader of the House, represent Welsh seats.

Yet despite Scotland and Wales having their own elected parliament and assembly respectively, they all get to lord it over England.

Imagine the reaction if half a dozen of the senior ministers in Scotland or Wales were English. There would be a riot. The Sons of Owen Glendower would have a fit of the vapours and would probably burn down the building.

Yet the English are expected to put up with unaccountable Welsh and Scottish MPs running our country. Blair — a Scottish public schoolboy — has little time for the English.

Instead of daft regional assemblies, he could out of fairness establish an English parliament — or at least exclude Scots and Welsh MPs from debates on purely English affairs and appoint ministers who are accountable to English voters.

But he won't in a million years. Far from running a big tent, Blair operates on the divide and rule principle — pitting Scots and Welsh against the English.

Monday, June 09, 2003


A newspaper columnist whose writings I often enjoy is Michael Duffy. He writes in my local Brisbane Courier Mail newspaper. He is a generally conservative writer from an Irish Catholic background who was for a time a Minister in the Australian Labor Party government led by Bob Hawke. Unfortunately, his publisher very rarely seems to make his columns available online -- though there is one exception here. Some of his columns have also been reproduced here.

I have, however, been emailed an extract from one of his offline columns, which appeared as: “Michael Duffy's Note Book” in the Courier Mail of April 12th, 2003, Pg 30. I reproduce it below:

Australia's humble role in the current war is now being dignified by a concept known as the "Anglosphere". The Anglosphere is the creation of businessman James Bennett, who believes English-speaking nations have much more in common with each other than they do with any one else..... He argued that regional alliances such as the European Union, or the desire of some Australians to be part of Asia, will always be less important than the cultural links that bind the Anglosphere..... he continues, the US needs to demonstrate some long-term vision and reach out with strong gesture.....

Bennett's theory has been accused of being merely a new version of Anglo-Saxon supremacy. His claims that the anglosphere is based on culture, not race..... There's no doubt Bennett thinks the Anglosphere should triumph over the UN.... Essentially Bennett is saying the Anglosphere has found the secret to prosperity and happiness and ought not to allow other nations to hamper us in our pursuit of these things. Moreover, in our international dealings we have the right to impose our values on others, for our and their own good. This demonstrates a sense of cultural absolutism that sticks in the throat of many Westerners, even though in most aspects of our daily lives we act as if this is what we believe.

For details of what Bennett really says, see here. I think that for once Duffy was relying on hearsay rather than checking the facts behind his contentions.

Saturday, June 07, 2003


Excerpt from a review of The Crisis of Islam by Bernard Lewis. Review by Greg Sheridan published in “The Weekend Australian Review” of June 7th, 2003 p. R10.

Here we come upon another of Lewis's most helpful definitional discussions. The designation of the US by the Iranian religious establishment as the Great Satan is something much more specific than a mere description of the US as extremely evil. Rather, the metaphor is used in the sense that Satan's role, in Islam and Christianity, is primarily to offer temptation. Satan is the great seducer, offering material and carnal delights to the faithful to tempt them away from righteous living.

Thus the roots of fundamentalist hatred of the US are not its support for Israel or any of the other litany of specific allegations levelled against it but that its material success offers Muslims, and Muslim societies, a great temptation to abandon the stringent practice of religion espoused by the fundamentalists.

So fundamentalism is a crisis of modernisation, in many ways an inevitable part of modemisation.

Lewis lists numerous reasons why many Muslims beyond the fundamentalist extremists, especially Muslim political activists, dislike the US. These include the burden of history, which bears so heavily on the Arab Muslim psyche, the US's alleged economic exploitation of Arabs, its propping up of despotic regimes, its support for Israel, its internal decadence. He points out, however, the inconsistency of Muslim sentiment on all this.

The now happily extinct regime of Saddam Hussein in Iraq, but also the Syrian and Iranian governments, have killed far more Arabs than Israel or the US has dreamed of doing, yet these events do not excite Arab moral outrage. This is partly because of the lack of democracy in the Arab world.

Israel, in Lewis's terms, is the 'licensed grievance" that everyone is allowed to talk about, so discussion of Israel is often a proxy for a whole world of grievances and hostilities.

Although Lewis doesn't precisely list a hierarchy of causes of hostility to the US, it would seem that the general burden of history - seeing the West as Islam's enemy and the US as the leader of the West - combined with the awful failure of Arab Muslim states in their experience of modernisation are the most important drivers of hostility to the West, including Australia.

This leads to a melancholy conclusion. This psyche, and these causes, took a long time, more than a millennium, to build. They won’t be changed easily or quickly.