Book Review
Asian Godfathers
Joe Studwell 
5/5 stars
"Economic history and conditions of Southeast Asia."
*******

Of the book:

-199 pages of prose/ 7 chapters; 28pps/per
-470 (notes+point citations); 2.36/page=well sourced
-6-7 hours of reading time.
-Brief biography of all the Godfathers, arranged by country. About 90 profiles.
-Brief biography of the codependent politicians, arranged by country. About 45 profiles.
-Selected bibliography arranged by topic. (Proponents of race-based interpretations of development. Skeptics of race based interpretations of development. Etc.)
-Deals with: Malaysia, Thailand, indonesia, Singapore, Philippines, Hong Kong, Macau.

Part I (42pps): Historical background

Part III (82pps): Four steps to be a post-war godfather

a. Build a character that is an amalgamation of Chinese and local;
b.  Have a government granted Monopoly that creates core cash flow.
c. Create your inner circle of people, some foreign, some local, some chinese.
d. Use government policy lenders to financial projects and keep the gains and socialize the losses. Multiple bailouts. Financial repression details.

Part III (74pps): Fallout and financial crisis in the 1990s and aftermath. There were some modest changes on the edges, but no sea change. 
******

This book follows the formula employed in Joe Studwell's "China Dream": It gives necessary historical background in order to to explain and analyze some current (journalistic) phenomenon. 

And it's just chock full of information.

In the "China Dream," it was putting into context the centuries old foreign craze to sell into the always-huge-but-never-commercially-fruitful Chinese market.

Here, the goal seems to be to explain the extreme concentration of wealth in Southeast Asia in a few (mostly Chinese, but not exclusively Chinese food okay) hands and to get some discussion on the causes and consequences of the Asian financial crisis. (This book was written before 2008.)

1. First is recapitulation of the fact that even though all of the migrants who came to the countries under discussion were Chinese, that has meant different things at different times.

Even if cultural reasons are a lot of why Chinese came to dominate Southeast Asia, they're not the only reason: political conditions in China at the time were very bad during the collapsing Qing dynasty and that created a motivation for motivated people to go elsewhere and make money.

2. Second is detailing the historical accidents that made it such that: Colonial Powers needed neutral people that they could work with on the ground, and Chinese fit this bill--and they did as revenue tax collectors and monopoly holders.

Because they were in the right position, they also were benefits of colonial government contracts in various places. Also, for some reason, the local people (Thai, Indonesian, etc) were just not interested in doing business (because maybe they thought it would make their hands dirty), and so that was a boon to the Chinese.

It also appears that after independence, the new indigenous leadership (which was often just as corrupt as the governments they replaced, nod to Orwell's "Animal Farm") needed the same type of neutral people.  The same PEOPLE, in fact.

Later on, The Godfathers relied on state monopolies for certain things (gambling, etc) in order to make a fortune from DOMESTIC inefficiencies. (Sorry about that, Milton Friedman, but neither Singapore nor Hong Kong are what you think.)

It's never exactly the same story twice, but that's just about it in a nutshell.

Secondary information:

1. Chinese triads (which have a 20-century history) were useful and needful to manage local Chinese coolies / others make several cameos in this book. They're also types responsible for kidnapping of family members of these tycoons in exchange for ransoms.

2. Vis-a-vis Asian Indians, most Chinese people did not return to China, with most of them marrying local people and speaking and living local languages. (It's not that East Asia could not have been Indian dominated, it's just that they didn't stay around long enough in large enough numbers to leave a footprint.)

3. As we have seen before, not everybody from one ethnic group is the same just because they happen to be from that ethnic group. Studwell introduces us to two very separate things: those who are shopkeepers and small business owners, and those that are truly overlords.

4. Wealth and degree of "Chinese-ness" are inversely proportional. There also seem to be a LOT of Evangelical Christians in here (p.50). 

5. Singapore has a higher execution rate per capita than either China or Saudi Arabia.
*******

*******
Second order thoughts:

1. All these Chinese men had multiple identities that could be taken on or put off at different times, subject to expendiency.

There is no shame in modifying your identity for the sake of convenience.

2. It is interesting that higher IQ races of people (such as Chinese and Jews) treat identity as malleable-subject-to-context and lower IQ ones (think of black people in North America) treat it as something to be idealized and preserved. (Afrocentrism is a very quirky manifestation of this.)

3. There's nothing wrong with eugenics, and these billionaire's profile in this book have no problem with admitting that some cultures / races are more efficient at producing better results. (This is as opposed to the current Western model of assuming that they are all equal and then explaining away differences and results as "racism.") For example: "Matahir's thinking that one solution for Malay's perceived genetic handicap was intermarriage with other races." Lee Kuan Yew was also a vocal proponent of Chinese genetic exceptionalism.

4. As much as populists talk about "redistributing the wealth," it seems like it works everywhere that people start off as well as wealthy.... There is some dramatic shake up... And the same people stay just as wealthy, or become even wealthier.

5. The best part was the conclusion where the author did a bit of comparative analysis of the South Korean and Taiwanese academies vis-a-vis Hong Kong and Singapore. The former two have recognizable brands because their economies were built on trying to manufacture products, as opposed to the latter two and much of Southeast Asia which has an economy built on rent seeking extractions.

*******

Quotes: 

1. All these expressions point to the same thing - - that the use by political power of a wealthy but dependent class of tycoons was too attractive to be ditched merely because of the end of colonialism.

2. We are so accustomed to disguise ourselves to others that in the end we become disguised to ourselves. LaRochefoucald.

3. (p.201) Of the [Russian] commercial Godfathers who have dominated the domestic economy since the end of the Cold war, almost every one is Jewish. They operate entirely at the discretion of a non-jewish political élite, whose whimsy has sent several to prison or exile...... The only big Russian godfather who is not Jewish is Vladimir Potanin.

4. Weather Hong Kong has been ruled by British colonialism, Japanese imperialism or Chinese communism, it has always been managed through the same group of people.

5. Oei Tiong Ham "Had a great interest in women and sex. He had 18 acknowledged concubines and a total of 42 children by them. Eka Tjipta Widaya is associated with at least 30 children. Stanley Ho has only 17 acknowledged children." (p. 59).

6. Southeast Asia is not comparable with the kleptocracies that have ruined many African countries. In most cases Southeast Asian politicians sell public resources and economic rights to private businessmen and do not interfere with the running of the businesses.

7. Racial prejudice went out the window once it was clear the local Godfathers were the key to the banks development.


Verdict: Recommended at the price of $3. The historical events in here are time independent, but the journalistic events are yesterday's news. The book was written in 2007, 16 years ago. (Li Ka-Shing is 95 years old and worth US$36.2 billion as of today.) A lot of the subjects have already died. (Lee Kuan Yew. Stanley Ho. Suharto.)This book could potentially be fun in order to test how well Studwell's predictions have aged.

Vocabulary: 

arkatia (Indian recruiters)
perankan (Indonesian Malay speaking Chinese middle men)
cabang atas - Chinese tax Farmers used by the Dutch
priyayi
baba (Malaysian Chinese)
Alibaba (business fronted by Malay but run by Chinese)
One syllable Chinese (those who had not assimilated and adopted local surnames, Lucio Tan, et al)
unctuous 
gweilo



Further Reading

Huston, Peter "Tongs, Gangs, and Triads"
Booth, Martin "The Dragon Syndicates"

G. William Skinner, various.