Modern society is often compared to past times and ages. Here, Daniel Smith returns and argues that the economic control exerted by a small elite today is similar to seventeenth century capitalism. 

You can read Daniel’s past articles on California in the US Civil War (here), Medieval Jesters (here), How American Colonial Law Justified the Settlement of Native American Territories (here), and Spanish Colonial Influence on Native Americans in Northern California (here), and differences in Christian ideology in the USA (here).

The Declaration and Standard of the Levellers, a 17th century English movement. Gerrard Winstanley was one of the founders.

The Declaration and Standard of the Levellers, a 17th century English movement. Gerrard Winstanley was one of the founders.

In light of our modern Renaissance, we as human beings in our own moral and ethical weaknesses have forgotten as people, that history canrepeat itself. With the invention of the television, computer, cell phone, Internet, and social media… Americans have become comfortable—complacent—and have forgotten about their own vulnerabilities in society. Most of the aforementioned gadgets were all invented within the last 30 years![1]In the last 100 years, government and wealthy private entities have slowly re-aligned the way that society is structured. We tend to easily forget about the history behind how we are even standing here today. Of course, who reallywants to remember their old classes from school? 

Well, if you have not figured out the fact that there are distinct “social-classes” in America and that we as Americans are ran extremely hard in the workforce, then this should help explain how we are living in a society that we can compare to the seventeenth century! It’s pretty eye opening actually. What has happened with the development of the global corporate world is just today’s version of the Hudson Bay Company, or even the East India Trading Company.[2]I learned that a man by the name of Gerrard Winstanley (1609-76) was a clothier and laborer who resided in England. Mr. Winstanley was said to have had “religious visions,” and in 1649, he wrote of these dreams. In arguing his ideas he had mentioned that on our earth, man was destined to slavery and to be “kept in the hands of the few.”[3]

This last quotation of course is his recognition to the fact that the top 2% of wealth holders were the established elite.[4]Seems eerily familiar to today’s 1%, doesn’t it? This hierarchy is based upon the newly structured global societal standards. So where do we all fit in to this historical and rather not too surprising sociopolitical hierarchy? Most of us sit squarely on the bottom two levels as peasants and vassals. In contemporary context the vassals are the top professionals like doctors, large business owners, entertainers, etc. The rest of us are sitting on the peasant level: laborers, farmers, retail and grocery workers, students, soldiers, truckers, etc. It’s really important to see that most of these careers existed in the old world. The differences today are in just how the information is delivered, including the method of the job being done.

While the re-structuring of global society has happened over the last half-century, the most important part of this whole process is to direct how money is controlled. Establishment of the central banking systems were made; entities such as the Federal Reserve, the Bank of Japan, the European Central Bank… just to throw out some names. These are the modern kings, queens, and emperors of the medieval and early-modern eras. There are a few ways to manipulate the societal ladder that we are in, such as a decent education and a solid career track. For the most part though, we are all here together, stuck doing our part, and given our own hands to play in life. Further, we can all agree as human beings regardless of spiritual belief, to never part in doing the best we can, as individuals, both morally and ethically while here alive on planet earth.

 

What do you think of the author’s arguments? Let us know below.

Finally, Daniel Smith writes at complexamerica.org.


[1]Cross, Gary. An All-Consuming Century: Why Commercialism Won in Modern America. New York: Columbia University Press, 2000. p. 17.

[2]Ziegler, Herbert, and Jerry Bentley. Traditions & Encounters, Volume 2: from 1500 to the Present. New York: McGraw-Hill Education, 2014. p. 462.

[3]G.H. Sabine, The Works of Gerard Winstanley[Ithaca, NY. Cornell University Press, 1941], pp. 251-4, 288.

[4]Wiesner, Merry E. "Politics and Power, 1600-1789." In Early Modern Europe, 1450-1789. Cambridge: Cambridge University Press, 2013. p. 343.

Posted
AuthorGeorge Levrier-Jones
CategoriesBlog Post

In this article we look at the importance of countries such as the US in the growth of the Taiwanese economy in the 1960s, and consider the role of the electronic industry in those Cold War years. 

President  Eisenhower's  trip to Taiwan in 1960

President Eisenhower's trip to Taiwan in 1960

Taiwan’s entry into the global economy was facilitated by a relationship between the Nationalist military and the US.

Taiwan focused on direct exports, subcontracting, consignment work for foreign corporations, and joint ventures. These opportunities provided substantial employment opportunity in Taiwan where, by the mid-1960s, 150,000 additional jobs were needed each year to keep pace with population growth.

In 1966, 723 new factories were established in Taiwan by foreign private corporations, creating 30,000 new job openings annually, 20% of the annual deficit. Moreover, Taipei’s relatively large number of trained professional management and technical persons was a factor in attracting industry.

One corporate executive noted the large reservoir of local talent stating:

In Taiwan trained people work at lower levels than anywhere else. There were many trained engineers among the refugees from the mainland who were working as porters.

Most of the trained refugees had settled in Taipei. Consequently, few Americans were assigned as resident managers in Taipei and most jobs went to local residents, not American expatriates.

An in-depth look at the electronics industry will expand our understanding of the penetration of the local economy by the multinational firm and the associated impact on Taipei’s urban development.

 

The Electronics Industry

By 1968 the electrical and electronic goods industry was Taiwan’s second biggest exporter after textiles and by 1984 it overtook textiles. The two industries were quite different.

Unlike textiles, the electronics industry had no base in Taipei prior to the arrival of the multinational corporation in the 1960s. It was shaped by global forces from the very beginning. Most of its production was exported, chiefly to the United States. The industry was characterized by a few foreign-invested assemblers, most from the US, and many locally and privately owned suppliers of components to them. Thus, the industry was strongly associated with the emergence of SME’s (small and medium enterprises), which eventually became the core of Taipei’s export sector.

As previously mentioned, the electronics sector was targeted as desirable by the military which was deeply involved in efforts to solicit foreign investment, along with the assistance and advice of US AID. Their hard work brought in first General Instruments (1964) and then other companies which set up bonded export factories throughout the island.

 

Much of the US incentive came from a need to compete with the Japanese.

In 1953, a Taiwanese firm (Tatung) had signed the first ever technology agreement between a Taiwanese and a Japanese firm. The Japanese company agreed to take engineers from the Taiwan firm for training. The agreement was supported and even funded by US AID (formerly the Economic Cooperation Administration).

By the late 1950s, a number of Japanese firms began seeking local partners for electrical assembly in order to obtain lower labor costs. Seven joint ventures were formed by 1963.

In the next two years, 24 US firms entered into production agreements with the Taiwanese. In 1965, the first export-processing zone opened in Kaoshiung in the south of Taiwan. The bonded factories established by many US firms offered basically the same advantages — relatively unfettered conditions in return for exporting all of their production. The object was to cut costs by getting the labor-intensive part of semi-conductor manufacturing — connecting the wire leads and packaging — done more cheaply than was possible at home.

 

By 1966, the Taiwanese government had decided to make Taiwan into an “electronics industry center.’

A Working Group for Planning and Development of the Electronics Industry was established to assist in marketing, coordinating production with the demands of foreign buyers, procuring raw materials, training personnel, improving quality, and speeding up bureaucratic approval procedures.

In 1967 and 1968, major exhibitions were held to introduce local manufacturers and foreign investors to each other. The objective was to take what began in Taiwan as an enclave industry and use it to create an entirely new sector of parts and components makers and, eventually, assemblers of finished goods able to compete internationally. According to Thomas B. Gold:

The state was the contrapuntal partner to the market system, helping to insure that resources went into industries important for future growth and military strength — including import substitutes for use in export production, such as synthetic fibers and plastics, and new export sectors such as electronics. Multinational companies became important players in these developments, but only after the state had a well-established presence and leadership position from which it could channel their activities rather than be made subordinate to global profits.

The consumer electronics industry is a good example of a dynamic industry that the state helped initiate and guide, but otherwise did not invest in directly or tie to state enterprises. Transnational corporations (TNCs) performed this function. This is a significant departure from the state-led pattern of the 1950s and represents a clear commitment to the American promoted approach of granting increased scope for private capital, local and foreign.

In a related move, in 1965, the regime established a publicly owned China Data Processing Center to push the use of computers in local industry. In advanced electronics, public research organizations and public enterprise spinoffs were used to acquire and commercialize new technology, a strategy promoted by both the Taiwanese military and the US.

 

Taipei’s locally owned SMEs play an important role.

Electrical and electronics exports grew at a rate of 58% a year between 1966 and 1971. Foreign firms were quite important in this area.

By the 1970s, over half of foreign firms’ exports were in electronics and electrical appliances, with foreign firms accounting for 2/3 or more of total exports from this industry. It is important to note, though, that foreign-owned companies (companies where more than of the 50% equity is held by foreigners) were surprisingly small and in no way dominated the economy. In fact, they paved the way for a new cohort of entrepreneurs, mostly Taiwanese of a petit bourgeois background.

To underscore, despite the contribution of the American multinational enterprise to the birth and success of export oriented industry in Taiwan, it is important to emphasize the significance of Taipei’s locally owned SMEs. They were an integral part of the drive toward expanded export capability, becoming more crucial over the course of the 1960s.

SMEs were the essence of the new middle class in Taipei which was to become a strong force in the move toward a democratization of politics in a city where the scale of business had a large influence on party affiliation and competition.

Most of the leaders of Taipei’s largest conglomerates had strong ties with the KMT, while heads of small and medium sized businesses tended to support the opposition. This is also consistent with splits along ethnic lines, for owners of SMEs tended to be native Taiwanese rather than mainlanders.

 

By Lisa Reynolds Wolfe

 

Want to find out more about Cold War Taiwan? Well click here to the see the original article on Lisa’s Cold War Studies site and scroll down the page for a variety of other great Taiwan articles!

 

And there is even more on Taiwan by clicking here. In this article we look at the deadly Taiwan Straits Crisis.

Posted
AuthorGeorge Levrier-Jones