Rage Against the System
“It is not a revolution… it is perhaps the first great insurrection
against global systems, the form of revolt that is
the most modern and the most insane,” French philosopher
Michel Foucault described the 1979 Iranian Revolution,
which toppled one of the most modern and rapidly growing
economies in the Orient. The downfall of Mohammad Reza
Shah Pahlavi, the strongman of Persia who held the title of ‘king
of kings’ (Shahanshah), represented one of the greatest political
shocks of the 20th century. After all, back then the Middle
Eastern nation was led by a staunch US ally who controlled
one of the world’s largest reserves of oil and gas, spearheaded
rapid industrialization and urbanization in a previously backward
agricultural nation, aggressively modernized educational
and cultural institutions, and oversaw a massive internal security
apparatus, namely the Organization for Intelligence and
National Security, better known by its Farsi acronym SAVAK,
which muzzled any kind of political opposition, whether secular
or religious, with ferocious intensity and vigilance.
What happened in Iran—namely, the unlikely revolt at the heart of a seemingly successful modernization project—is what Slovenian philosopher Slavoj Žižek aptly described as “trouble in paradise.” As Žižek explains, “we might see the [Ayatollah] Khomeini revolution of 1979 as the original ‘trouble in paradise’, given that it happened in a country that was on the fasttrack of pro-Western modernization, and the West’s staunchest ally in the region.” Beneath the facade of harmonious modernization under the supposed benign rule of a enlightened despot, however, Iran was teeming with public dissatisfaction vis-ŕ-vis rising inequality, culture wars (as imported Western values clashed with traditionalism), gross human rights violations (as the regime cracked down on dissent), and what many saw as unmistakable national humiliation (as the Shah welcomed the presence of foreign militaries) amid growing strategic subservience to Western powers, particularly the United States. In this sense, as Foucault correctly observed, the Iranian revolution was a popular uprising—led by a mélange of communists, liberal technocrats, and radical Islamists, who later came to dominate the post-revolutionary landscape under the leadership of Khomeini and his disciples—against the globalization project at the heart of ancient Persia.
But confidence in the teleological certainty and moral superiority of globalization—the spread of Western consumer values, free market principles, and liberal democratic institutions—was restored with a vengeance almost a decade after the Iranian revolution, when the world witnessed the phantasmatic collapse of the USSR. The seemingly inexorable terminus of the decades-old Cold War was swiftly supplanted by what US political scientist Francis Fukuyama famously termed as “the end of history”—the resolution of millennium-old ideological struggles in favor of the Western synthesis of capitalism and democracy. In fact, Fukuyama triumphantly asserted, “something very fundamental has happened in world history,” namely the “the total exhaustion of viable systematic alternatives to Western liberalism.” At first, the sense of optimism proved potently verified by encouraging developments on the ground.
What Fukuyama had in mind was essentially the process—and triumph—of Western-led globalization, which pertains to the spread of Western liberal values, diffusion of advanced technology, and integration of markets via rapid movement of capital and commodities across borders. Globalization, particularly its economic dimension, was more by design than by some mystical, Hegelian march of history. Soon after the USSR’s collapse, globalization entered a turbo-charged phase. While George H.W. Bush declared a “new world order,” it was the Bill Clinton administration that advocated, with significant success, for a new era of global economic integration, overseeing the negotiation and implementation of regional trade agreements such as the North American Free Trade Agreement (NAFTA), the establishment of the World Trade Organization (WTO), the upgrade of the Asia-Pacific Economic Cooperation (APEC) into a high-profile platform for trade and investment negotiations in the Pacific Rim, and the full entry of China into the global economic order. As the investment guru Ruchir Sharma documents in Breakout Nations, the first two decades of the post-Cold War period, up until the 2008 Great Recession, proved as conspicuously fortuitous for many of the so-called ‘emerging economies’: the rapidly prospering post-colonial nations that experienced above-average growth rates at their specific stage of economic development. Many developing nations experienced rapidly rising per capita incomes, large-scale infusion of foreign technology and capital, and voracious assimilation of global and Western values of consumption, travel, and social engagement. From 2000 to 2005, the total amount of capital flowing into emerging markets expanded by 92 percent. Over the next five years, it reached a staggering 478 percent. The first half of the 21st century saw the doubling, from 20 percent to 40 percent, of developing economies’ contribution to the total global economy.
This was globalization at its heyday, as growing intra- and inter-regional trade, coupled with the diffusion of technology, capital, and free market values, congealed into a global wave that lifted hundreds of millions of people out of extreme poverty, giving birth to a breed of middle class across the developing world. It did not take long, however, for the “end of history” thesis of celebration to be put to the test against actual, moving history. From the rise of religious fundamentalism and vicious forms of sectarianism, which gave birth to a new age of terror that has torn the ancient civilizations of the Near East asunder, to earthshaking genocidal expressions of micro-nationalism, which consumed post-colonial nations in the Balkans and Sub-Saharan Africa, the world witnessed what geopolitical guru Robert Kaplan presciently foresaw as “the coming anarchy.” For Kaplan, who extensively travelled across developing nations amid the euphoria generated by the collapse of the USSR, “increasing lawlessness” in many parts of the world will likely be the “political character of our planet… in the twenty-first century.”
This “lawlessness” first emerged, in its most potent form, in the aftermath of the Arab Spring uprisings of 2010-2011. And just like Iran in 1979, popular revolts first struck the unlikeliest destinations, namely Tunisia and Egypt, which were then considered as the most liberal, secular, and economically diversified nations in the Arab world. It was a ‘trouble in paradise’ redux. The euphoria of the Tahrir Square protests and Jasmine Revolution was swiftly supplanted by the horrors of counterrevolutionary sabotage, led by elements of the ancient regime, as well as religious fundamentalists such as Al Qaeda and, later, the Islamic State of Iraq and the Levant (ISIL), also known by its Arabic acronym of DAESH, who wrecked havoc in one regional state after the other and morphed into the world’s most dangerous terrorist franchise.
At their heart, the Arab revolutions were against neoliberal globalization, which led to the emergence of a vicious strand of crony capitalism and a suffocating form of autocracy across much of the region. Under the behest of international financial institutions (IFIs) such as the World Bank and the International Monetary Fund—which acted as merchants of economic globalization, namely the systematic deregulation of economic activity, large-scale privatization of state assets, and sustained lowering of tariffs on foreign goods—Arab economies such as Egypt and Tunisia opened up their banking sector just to see regime-friendly oligarchs dominate the newly-privatized financial system. They lowered their trade barriers just to see cheap, foreign products, mainly from Asia, food their markets and eviscerate local manufacturing. They were integrated into global chains of production, but as low-value-added, import-dependent members of the international economy. Meanwhile, autocratic regimes maintained their hold on power, largely working in tandem with IFIs and their Western allies. The upshot was one of the world’s highest rates of inequality, youth unemployment, food insecurity, and corruption. The Arab uprisings were a cry for freedom, in a political but also an economic way, from the shackles of a pernicious form of globalization.
The more promising economies of Asia were not immune to the fallout of globalization. The poster children of economic globalization would soon experience their own forms of popular backlash against globalization, which gave rise to a new strand of populist leaders such as Narendra Modi, Joko Widodo, and Rodrigo Duterte, who promised decisive and single-minded policies which benefited the majority instead of a narrow chunk of the liberal elite and entrenched oligarchy. Asia was by now, in the words of Indian essayist Pankaj Mishra, engulfed by “globalization of rage.” As Mishra explains, on the other side of the globalization coin, the world witnessed the precarious emaciation of “traditional forms of authority everywhere,” which has “produced an array of unpredictable new international actors that have seized on the sense of alienation and dashed expectations that defines the political mood in many places.” Both extremists and demagogues have skillfully, and with potent destructiveness, “tapped into the simmering reservoirs of discontent” across the world’s most promising economies and democracies. The upshot is an “age of anger,” which is undermining the liberal underpinnings of globalization, a decades-old (and increasingly failed) project aimed at integrating markets, universalizing liberal democratic values, and, in the view of many, solidifying the supremacy of Western civilization under Pax Americana.
Trouble in Paradise
The Philippines is a truly unique nation.
It is a Catholic-majority society in
a region where Islam, Buddhism and
Hinduism are dominant. It was the sole
American colony in Asia, with one of
the oldest traditions of democratic competition.
It has among the largest population
of English-speaking citizens, and
incredibly scenic natural landscapes,
from white-sand beaches to beautiful
rice terraces in the sky-high mountains.
But what makes it most unique is how
it started as the region’s second richest
country in the mid-20th century, but
ended up as among the poorest in Asia
by the end of the century. For long, it
was aptly dubbed as the “sick man of
Asia,” mirroring, albeit on a far humbler
scale and within a shorter span, the fall
of the Ottoman Empire from grace and
wealth between the 17th to 19th centuries.
First came Japan, a “completely crushed” nation as General Douglas MacArthur put it, which was catapulted from utter ruin into the world’s second largest economy within almost just a single generation. Then came the newly industrialized countries (NICs) of South Korea, Singapore, and Taiwan. Towards the end of Cold War, Malaysia, Indonesia and Thailand joined the so-called group of ‘tiger cub’ economies, as they benefited from an aggressive wave of Japanese investments in Southeast Asia. By the frst decade of the 21st century, the war-ravaged and long-isolated Hanoi was knocking on Manila’s door. Economic stagnation at home went hand in hand with the exodus of almost 10 million Filipinos, who desperately sought better working conditions in far-flung destinations. Widespread rural poverty fueled insurgencies, while the ethnic conflict in the southern region of Mindanao continued unabated. The Philippines became the epitome of great potentials gone unfulfilled as corruption, overpopulation, inequality, and poverty defined a broken national spirit. The country posted sluggish rates of growth as China, India, and Vietnam enjoyed double-digit growth rates.
The second decade of the new century, however, saw a dramatic turn in the Philippines’ fortunes. All of a sudden, the Southeast Asian country was once against considered as a potential growth pole, with the World Bank and international investors heralding the rise of a new ‘Asia’s rising tiger’ economy in the Far East. Under the Benigno Aquino (2010-2016) administration, the Philippines consolidated its finances, cut budget deficits, reduced inflation, and boosted GDP growth to an annual average of more than six percent. Next to China, the Philippines became one of the fastest growing mid-to-major economies in the world. There was also a perceptible improvement in the country’s productivity, as the Philippines leapfrogged other countries in economic competitiveness and openness rankings. Moreover, the Aquino administration didn’t only restore macroeconomic stability, it also pushed ahead with good governance (Daang Matuwid) reforms aimed at curbing corruption, cutting red tape, and enhancing accountability and transparency in state institutions. The ultimate aim was to restore confidence in the government and Philippine democracy. Impressed by the turn of events in the country, Ruchir Sharma dubbed the country as one of the next “breakout nations,” while allied nations poured in development assistance. The United States, for instance, ruled the Philippines eligible for the US$400 million Millennium Challenge Corporation (MCC) aid package, which aims to enhance accountability, transparency, and responsiveness in burgeoning democratic nations. Towards the end of the Aquino administration’s term, the Philippines was the unquestionable toast of the town of the global media and investment community, and a poster child for democratic deepening going hand in hand with economic boom.
The Strongman in Manila
Yet, despite ending on a strong note,
not to mention high approval ratings,
the Aquino administration profoundly
struggled to rally the population around
its preferred successors, particularly Interior
Secretary Manuel “Mar” Roxas
II, who lost the presidential election in
a humiliating landslide to a provincial
mayor, Rodrigo Duterte, who promised
to end crime and corruption in the country
with an iron f st. Duterte’s shocking
electoral victory seemingly marked a repudiation
of not only the Aquino administration,
but also the whole democratic
system that was created after the ouster
of the Ferdinand Marcos dictatorship in
1986, exactly three decades earlier. In
fact, Ferdinand Marcos Jr., the sole son
of the former dictator who oversaw decades
of economic stagnation and widespread
human rights violation, lost the
vice-presidential race by just a whisker,
later contesting the outcome by claiming
electoral irregularities and widespread
Duterte threatened martial law, closure of the Philippine Congress, and the end of the Philippines’ century-old alliance with the United States, and oversaw a bloody, scorched-earth campaign against illegal drugs, just as he promised during the campaign period. His mercurial character, provocative rhetoric, and constant flip-flopping on policy statements sent stock markets wild and brought the Philippine peso to its lowest levels in almost two decades. And yet, the foul-mouthed and controversial Filipino leader continuously maintained extremely high trust and approval ratings at above 80 percent. What went wrong? How did Duterte pull of arguably the biggest electoral shock in Philippine history? How can this roller-coaster shift in Philippine politics and fortunes be explained?
Fundamentally, what has happened in the Philippines is not too different from what transpired in Iran in 1979 and across the Arab world in more recent years. The victory of Duterte arguably represents a form of backlash against economic globalization. Back in 2015, the Philippines was the world’s fourth fastest growing economy, while the following year it posted the fastest growth rate in Asia. Impressive as the macroeconomic trends looked, the growth in the country was not even nearly inclusive—too concentrated among the elite few to convince the majority of the people to bet on Aquino’s successor, Roxas, who promised to continue the (shallow) reforms of the outgoing president if elected to the presidency. The reason is mostly structural. Similar to Tunisia and Egypt, recent decades saw the Philippines tightly integrated into the global economy, but as a low-value-added component. Like Arab countries, the Southeast Asian nation also saw the erosion of the domestic manufacturing sector, with the famed Marikina shoe industry almost decimated, amid the massive inf ow of cheap commodities from China and other major regional exporting nations. The growth in the Philippines, meanwhile, was largely concentrated in a low-to-medium-end services sector, with business process outsourcing (BPO), large-scale retail (mostly dominated by the Chinese-Filipino minority), and speculative sectors such as real estate, serving as the engine of a low-quality, concentrated type of growth. Absent a significant expansion in the manufacturing sector, the Philippine economy did not produce enough well-paying jobs. After all, manufacturing has underpinned successful economic transformation around the world, since it provides well-paying and ever-expanding employment opportunities to people across the skills spectrum. In countries such as the Philippines, the “manufacturing imperative,” to use Harvard economist Dani Rodrik’s terminology, was sorely missing. Data shows that the recent economic boom in the Philippines was over-concentrated, with the 40 richest families swallowing up 76 percent of newly-generated growth. Add to that the extremely oligarchic nature of the Philippines’ electoral landscape, with roughly 178 political dynasties (family members dominating elected offices simultaneously or in rapid succession) virtually controlling (dominating state coffers, local police, and media) 73 out of 81 provinces across the nation. Up to 70 percent of members of the Philippine legislature belong to political dynasties, which made a mockery out of the country’s ‘democratic’ system. The Aquino administration, similar to its predecessors, did nothing to change the situation, as it refused to support various legislation to curb the corrosive cooptation of elected offices and state institutions by the local and national oligarchies. If anything, the recent economic boom just strengthened the grip of the narrow circle of elites, who dominated the Philippines’ political economy.
The Philippines may, unlike the Arab countries and Iran, represent a more liberal democracy, but in essence it is a crony capitalist nation dominated by an age-old oligarchy which has ravaged the masses for more than a century. Add to this the miserable state of the Aquino administration’s performance in providing affordable and effcient services, particularly in terms of public transportation. According to the 2015 Global Driver Satisfaction Index, Manila has the world’s worst traffic congestion, thanks to what The Economist in 2016 identified as “transport plans [that] have been terrible—among the most foolish adopted by any great city.” In recent years, the Metro Rail Transit (MRT) system experienced frequent breakdown, not to mention an embarrassing blackout in the country’s international airport. Big-ticket public-private partnership infrastructure projects, meanwhile, experienced delays and alleged anomalies in the bidding process. Anti-corruption initiatives were at best haphazard and at worst lopsided (targeted against opposition members) and ineffective, since not a single high-profile politician was convicted.
In Political Order in Changing Societies, Harvard University professor Samuel Huntington precisely warned about the prospects of autocratic takeover and political breakdown in developing nations which underwent rapid (but uneven and disruptive) economic growth. Rising gross income levels, Huntington explained, are generally accompanied ... but in essence it is a crony capitalist nation dominated by an age-old oligarchy which has ravaged the masses for more than a century. by the mobilization of new sectors of the society, the aspirational middle class often in tandem with what Hannah Arendt in 1951 called the “mass society” of disenfranchised and alienated individuals, who begin to demand greater public services. The problem, as Huntington correctly foresaw, is the inability of fragile, corrupt state institutions to respond accordingly to a revolution in public expectations and a profound sense of relative deprivation among those left out by the recent economic boom. In this sense, Huntington echoes Karl Polanyi’s analysis of the double-movement of societal backlash against the elite in periods of rapid, disruptive transformation.
In many ways, Huntington, Arendt, and Polanyi shed light on what has transpired not only in the Philippines, but also among a whole range of rapidly growing emerging market democracies. The upshot is the rise of outside the box leaders, often with populist or authoritarian tendencies. As the post-colonial scholar Pankaj Mishra eloquently explains, the appeal of this new breed of leaders lays in “of ering not so much despotic authority as a new relationship between the rulers and the ruled,” while their electoral prowess is driven by how they “shrewdly grasped a widely felt need for a new mode of sincere, dedicated leadership, as well as a more energetic way of involving the masses in politics.”
In Indonesia, we saw the meteoric rise of Joko Widodo, the former mayor of the small city of Surakarta, who has combined grassroots mobilization with leftist-nationalist economic protectionism and a tough stance on crime, particularly illegal drugs. In India, we saw the equally meteoric rise of Narendra Modi, the Hindu nationalist former governor of Gujarat who has promised swift and decisive leadership with often authoritarian tactics. Duterte represents a similar form of populist backlash against the cosmopolitan oligarchy, which oversaw rapid but exclusive growth in the Philippines in recent years. It is too early to tell where the Philippines is headed, but what is clear is, to paraphrase Marxist thinker Antonio Gramsci, the older order is withering but a new one is still in conception.