From poverty to power - Oxfam-Québec

2 POWER AND POLITICS I RULE, THEREFORE I AMPromote growth: All these states actively intervened in the economy,building infrastructure and directing credit and support to thoseindustries they deemed to be ‘winners’. Crucially, they were also ableto drop ‘losers’: if companies or sectors failed to perform, the statewithdrew support and let them founder. By promoting domestic savingsand investment, they were able to minimise their dependence on ficklesources of foreign capital.Start with equity: South Korea and Taiwan began their take-offs afterthe Second World War with ‘pre-distribution’ in the shape of radicalland reforms, Malaysia with an affirmative action programme infavour of the economically excluded ethnic Malay population.Integrate with the global economy, but discriminate in so doing:The tigers used trade to generate wealth, but protected fledglingindustries. Governments actively promoted national firms, engagingselectively with foreign investment rather than bowing to US andEuropean demands that they accord foreign companies the sametreatment as local ones. These economic development policies arediscussed in greater detail in Part 3.Guarantee health and education for all: Development is synonymouswith healthy and educated populations, not least because anindustrial economy requires a skilled and fit workforce. In recentdecades, many developing countries (not just in East Asia) have madeenormous advances in health and education.A study of East Asia’s successes also debunks some commonmyths: many economies grew despite high levels of corruption;countries such as China and Viet Nam have not guaranteed Westernstyle‘property rights’ deemed essential by the World Bank and others;and Malaysia and Viet Nam overcame the ‘resource curse’ of abundantmineral and agricultural wealth that is often seen as a death sentencefor developing countries.93