Crony Capitalism: Corruption and Development in South Korea and the Philippines

Crony Capitalism: Corruption and Development in South Korea and the Philippines

Crony Capitalism: Corruption and Development in South Korea and the Philippines

Crony Capitalism: Corruption and Development in South Korea and the Philippines

Synopsis

Why has the literature on Asian development not addressed the issue of money politics in Korea? How can we reconcile the view of an efficient developmental state in Korea before 1997 with reports of massive corruption and inefficiency in that same country in 1998 and 1999? Politics is central to the answer. This study argues that both Korea and the Philippines experienced significant corruption throughout the post-independence era, and that political--not economic--considerations dominated policy making in both countries.

Excerpt

[Martial law] was a liberation – particularly for the business community. …it meant an equalization of opportunity, a breaking down of the old bastions of privilege that had kept political power a captive of economic monopolies. … Having finally freed ourselves from the stranglehold of the old oligarchy, we must see to it that we neither resurrect it nor replace it with a new oligarchy through a cartelization of economic privilege.

– Ferdinand Marcos

Imagine an Asian country that has enjoyed significant American patronage over the decades. Its people are hardworking and value education and the family. Family ties are so important that scholars and journalists call clans the basic building block of the country, and who one knows matters far more than what one can do. This country has a long history, consisting mostly of being colonized by outside powers. Since World War II, the country has been ruled by a set of elites – quasi dictators and their rich businessmen friends. Within the country its politicians switch parties at the drop of a hat. Party identification means nothing; ideology and programmatic differences are almost absent in elections; political success hinges on personalities, political manipulation, and pork-barrel politics. With episodic regularity, the country's leaders and economic elites have been either arrested or forced into exile because of recurrent corruption scandals. The local press calls corruption “our disease, ” and one of the most popular topics of conversation in local drinking halls is the utter lack of qualified leadership in both the economic and the political spheres. Privilege is measured by the extent to which one is an exception to the rules. Thousands of this nation's residents emigrate every year to the United States either to study or to live permanently, and the American presence is everywhere – from the style of advertising on television, to popular . . .

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