← Autodidact Archive · Original Dissent · Faust

Thread 4760

Thread ID: 4760 | Posts: 4 | Started: 2003-02-03

Wayback Archive

Faust [OP]

2003-02-03 05:42 | User Profile

Will U.S. Retain Its “Market-Dominant Majority”?

By Steve Sailer

Francis Fukuyama famously announced at the end of the Cold War that humanity had reached "the end of history." Unfortunately, he forgot to tell history not to bother coming to work.

Easy as it is to make fun of Fukuyama, where exactly did he go wrong?

Fukuyama's conception was formed by his expensive miseducation in the works of Hegel and other 19th Century German philosophers. History consists of the struggle to determine the proper ideology. Now there are no plausible alternatives to capitalist democracy. History, therefore, must be finished.

Lenin held a more realistic theory of what history is about: not ideology, but "Who? Whom?” (You can insert your own transitive verb between the two words.) History continues because the struggle to determine who will be the who rather than the whom will never end.

Fukuyama may be the only major nonwhite American intellectual who does not write primarily about race. This is admirable in many ways, but it's a fatal shortcoming in a thinker of such expansive ambitions. Race remains enormously relevant in this world.

Amy Chua's readable and eye-opening new book "World on Fire: How Exporting Free Market Democracy Breeds Ethnic Hatred and Global Instability" documents just how pervasive ethnic inequality is around the world—and how much that drives the traumas we read about every day. (See also Paul Craig Roberts' review of her book here.)

Chua builds upon Thomas Sowell's concept of the "middle-man minority"—the often-persecuted immigrant ethnic group with a talent for retailing and banking, such as Jews, Armenians, Chinese, Gujarati Indians, Lebanese Christians, etc. She broadens that idea to include other relatively well-off groups, such as un-entrepreneurial hereditary landowners, like the Tutsis of Rwanda and the Iberian-descended whites of much of Latin America. She lumps them all together under the useful term "market-dominant minorities."

Chua begs off explaining why economic inequality exists between hereditary groups. So let me offer a general explanation.

Creating wealth is difficult. People who have wealth pass down their property, their genes, and their techniques for preserving and multiplying wealth to their descendents, rather than to strangers.

In countries without a reliable system of equal justice under the law, clannishness is particularly rational. Businessmen must depend upon their extended families for protection and enforcement of contracts. So they are particularly loath to do serious business with people to whom they have no ties of blood or marriage and who would thus be more likely to stiff them on a deal.

"Globalization," or economic liberalization, tends to make the poor majorities slightly richer and the "market dominant minorities" vastly richer. Sometimes the masses find this an acceptable tradeoff. But sometimes it drives them into a fury.

Often, the minority's post-globalization riches are honestly earned, but not always. American-backed privatization schemes in Russia and Mexico put huge government enterprises into the hands of the most economically nimble and politically well-connected operators at give-away prices. (Chua and her brave editor Adam Bellow, who published The Bell Curve, deserve praise for calling attention to the ethnic makeup of the post-Soviet "oligarchs," something I was completely unaware of.)

Chua, a professor at Yale Law School, is herself the progeny of a market dominant minority: the Chinese of the Philippines. Chinese-speakers make up only 1% or 2% of the Philippines’ population. But they own the majority of the country's business assets. They seclude themselves in a luxurious world fenced off from the indigenous majority, whom they hold in contempt and wouldn't dream of marrying.

Not surprisingly, the impoverished natives aren't crazy about the rich newcomers. Chua's beloved aunt in Manila was brutally murdered by her chauffeur. The unmotivated cops made little effort to find him.

It's definitely nicer to belong to the minority than to the majority in these countries. But Chua makes clear that, to Americans used to our norms of congeniality and social equality, it would be an awfully depressing way to live.

After anti-Chinese riots in 1969, the Malaysian majority voted itself affirmative action at the expense of the Chinese. Chua considers this quota system a success. Malaysia has avoided subsequent violence.

Still, long-time Prime Minister Mahathir Mohamad, the world's pre-eminent Muslim statesman (granted, the competition isn't stiff), has become disillusioned with his plan. As he put it recently: "I feel disappointed because I achieved too little of my principal task of making my race a successful race…" The same week that President Bush tacitly endorsed college admissions quotas, the strong-willed Mohamad ended them.

A much grimmer example: Indonesia. The Chinese made up 3% of its vast population, yet owned the great majority of all businesses. The dictator Suharto, whose family had lucrative ties to the Chinese community, fell in 1998. Democratization set off a vicious pogrom against the Chinese, many of whom fled to Chinese-majority Singapore. The government expropriated $58 billion in assets.

Not surprisingly, the native Indonesians proved inept at running the businesses nationalized from the Chinese, and the economy collapsed.

All of which leads to a disquieting conclusion: it can be contradictory for America to demand that other countries simultaneously free their economies and democratize their politics.

We are seeing this in Venezuela right now. The dark-skinned, democratically-elected Hugo Chavez is at war with the fair-skinned rich, who want the national oil company privatized. The Bush Administration ludicrously endorsed the white elite's coup against Chavez last spring as a "victory for democracy," only to be embarrassed when the majority rose up and reinstalled him.

(Chua shows that all across South America since the year 2000, brown and black people are finally developing ethnic self-consciousness and solidarity in the struggle against the whites who have so easily held them down for so long. This historical shift will probably be reflected among Hispanic immigrants in the U.S., most likely to the electoral benefit of the Democrats. Similarly, Beijing's sponsorship of anti-white racialism following Tiananmen Square has translated into a shift to the Left among Asian-Americans.)

That property rights and one man-one vote democracy don't always mix well would not have surprised Aristotle, Edmund Burke, or Alexander Hamilton. Yet many Americans who call themselves conservatives have forgotten this.

One reason: we are one of the fairly small number of lucky countries with "market dominant majorities." We can have our cake (capitalism) and eat it too (democracy) because our majority group is economically quite competent.

America's perpetual trouble has been a less-productive black minority. Black-white economic inequality is not a problem that America is going to be able to solve any time soon. But, due to our market-dominant majority, our country is rich enough to live with it.

In contrast, if our current mass immigration system is allowed to continue, America will become just another country with a market dominant minority. Through government policy, we will have inflicted upon ourselves the kind of ugly society seen in most of the rest of the world.

[Steve Sailer [email him], is founder of the Human Biodiversity Institute. His website www.iSteve.com features site-exclusive commentaries.]

If you want to email or print out, format by clicking on this permanent URL: [url=http://www.vdare.com/sailer/market_dominant.htm]http://www.vdare.com/sailer/market_dominant.htm[/url]

Hereward

2003-02-04 00:14 | User Profile

Here's the link Sailer referenced about the ethnicity of the Russian oligarchy:

[url=http://www.forward.com/issues/2002/02.09.13/arts1.html]http://www.forward.com/issues/2002/02.09.13/arts1.html[/url]

'Jews Are Fighting and the Whole Country Has To Watch' Jews in Power or Jewish Power? The Captains of Russia's Post-Communist Economy Invited Uneasy Questions

The Oligarchs: Wealth and Power in the New Russia By David E. Hoffman PublicAffairs, 567 pages, $30.

My Jewish Fate By Boris Usherenko Self-published (in Russian), 381 pages, 100 rubles ($3.23).

By S.A. GREENE Sometime during the autumn of 1996, a small group of the most powerful men in Russia gathered in a villa on Moscow's Sparrow Hills district and worried aloud about antisemitism. They were Russia's famous "oligarchs," men who, in the aftermath of communism's fall, ran banks, oil companies, television stations and, increasingly, the country, and they had reason to worry: Most of them were Jews.

"In earlier years, when the moguls gathered to talk or make deals, when they dined in the villa on Sparrow Hills, or when they entered the Kremlin to warn Yeltsin, they were largely hidden from public view," writes former Washington Post Moscow correspondent David E. Hoffman in his recent book, "The Oligarchs: Wealth and Power in the New Russia." "But in the autumn of 1996, it was no longer possible to conceal their ambition and their presence in the highest councils of the state. They worried, among themselves, about a backlash."

The threat of an antisemitic uprising never materialized. The oligarchs, and Jews in general, are frequent targets of the nationalist press, and extremist firebrands still occasionally call out their names in public, but the Russian street has yet to take up calls for their blood. Indeed, thanks to a rapidly opening and normalizing economy, the oligarchs may soon be a relic of Russian history.

If so, Hoffman's book will be a valuable record. Through careful reporting and unprecedented access to almost all of the major oligarchs themselves, Hoffman — now the Post's foreign editor — has ably picked up where his predecessor, David Remnick, left off after "Lenin's Tomb" and "Resurrection." It is difficult to imagine a book with more insight into the personalities and struggles that created today's Russia.

If the book has a flaw, however, it is in not answering one of the central questions it raises: Why is it, and what does it mean, that so many of these men — men who ruthlessly acquired and manipulated Russia's resources and, for a time, its government — are Jewish?

Of the six main characters in the book, four are Jews: Boris Berezovsky, now exiled and wanted at home for corruption, who at one point owned everything from auto-makers and airlines to banks and a TV network and earned the moniker "Godfather of the Kremlin"; Vladimir Gusinsky, banker turned media-magnate whose quarrels with President Vladimir Putin sent him into exile; Alexander Smolensky, perhaps Russia's most notorious banker, the collapse of whose bank in 1998 wiped out thousands of people's savings, and Mikhail Khodorkovsky, leader of Russia's second-biggest oil company, who survived political scandals and the collapse of his own bank. The other two — Moscow Mayor Yury Luzhkov and reformist-politician-turned-energy-czar Anatoly Chubais — are not Jewish, though that hasn't stopped nationalists from making accusations about Jewish heritage. (The book's index, meanwhile, contains at least another 25 prominent Russian Jews, including tycoons Roman Abramovich, Pyotr Aven and Mikhail Friedman and politicians Yegor Gaidar, Boris Nemtsov, Yury Skuratov and Bella Zlatkis.)

They were, by and large, men who learned early how to manipulate the system. Gusinsky bought copper wire on the black market to make the bracelets that funded his first fortune. Berezovsky did a brisk shuttle trade in German cars and Italian computers. Khodorkovsky used connections in the Communist Youth League to finagle lucrative software contracts. For many of them, particularly Berezovsky, Smolensky and Khodorkovsky, the resulting cash came in handy in 1992, when Chubais, then prime minister, handed every Russian citizen a voucher good for one share in about one-third of the country's economy. The nascent oligarchs used bought-up vouchers by the thousands and redeemed them for entire industries, some of which they proceeded to sell for scrap.

That, meanwhile, positioned them to take advantage of the next several rounds of privatization, in which key companies were to be sold via tenders. In practice, though, the small circle of key oligarchs nurtured contacts in the Kremlin, as Hoffman writes, to ensure that each won the tender he wanted. Chubais and other reformers, meanwhile, were willing conspirators. The way they saw it, mass privatization — even if massively corrupt — was the best way to rule out a return to communism. Eventually, they reasoned, the market would work things out on its own. But for most of the 1990s, the course of the Russian economy — and often of its government — was decided by the leading oligarchs in Sparrow Hills.

But by 1996, some of the oligarchs were beginning to worry. Nationalist politicians on the left and right were decrying what they called the theft of Russia's industry and the "oligarch Jews" who engineered it. For many of the oligarchs, it was by no means the first time they had been called "Jews," whether by Soviet bureaucrats or schoolyard bullies. Hoffman's book is replete with such detailed accounts. The fact that Smolensky and Khodorkovsky have mixed parentage, and that Berezovsky is a practicing Christian, was of no concern to bigots, then or now.

Their worries were not unfounded. As Berezovsky freely admits, none of them got where he was entirely honestly. According to Hoffman, Berezovsky built his empire on shady import deals, while Smolensky and Khodorkovsky dabbled in something resembling money laundering. When Smolensky's bank collapsed, he famously said that his bilked depositors "got what they deserved." Between them, Berezovsky and Gusinsky controlled the country's two biggest television stations, the leading news radio station and several of the largest newspapers and magazines. The fact was that the media in Russia was controlled by Jews; antisemites didn't really care which Jews in particular. Even mainstream politicians such as former Prime Minister Viktor Chernomyrdin didn't really like the idea; when Berezovsky and Gusinsky were embroiled in one of their public quarrels, broadcast for all to see on their respective television stations, Chernomyrdin said, "Two Jews are fighting and the whole country has to watch." For anyone familiar with Russian history, the road from scandal to pogrom would have seemed perilously short.

Awareness of that history led the oligarchs in contradictory directions. On that fall evening in Sparrow Hills, the attendees — Berezovsky, Friedman, Gusinsky, Khodorkovsky and Smolensky — collectively decided that masking their Jewish identities would be the best option. A non-Jewish oligarch, Vladimir Potanin, was chosen to be their public liaison to government. Berezovsky was soon seen wearing a cross and attending Russian Orthodox churches. Still, no matter how hard they tried to distance themselves from Judaism, until very recently a glance at their passports would have given them away.

And yet less than a year earlier Friedman had joined Gusinsky and a handful of other prominent Jewish businessman in organizing the Russian Jewish Congress. Outwardly, the congress's aim was that of any Jewish group anywhere — to support synagogues, schools and other religious and cultural activities. But, according to Boris Usherenko, a Russian actor turned Jewish activist and journalist who documents his stint as the first executive secretary of the Russian Jewish Congress in his self-published book, "My Jewish Fate," fear of antisemitism also played a part.

At one of the congress's early planning sessions in late 1995, Usherenko writes, the founders' purposes were bluntly, if awkwardly, put. "Fiery speeches were made. [Chief Rabbi Adolf Shayevich] inspiringly contrasted the depressing past with the shining future. [Gusinsky] expressed his nostalgia for the old rusty pipe he used as a boy to beat antisemites. I remember [one attendee's] fierce defense of his ideal — Jews with machine guns."

It was not, however, the first time Jews were attacked for being at the vanguard of a tumultuous revolution. Before and after 1917, nationalists pointed to the heavy Jewish presence in the Bolshevik leadership, from Trotsky on down. Even today, Lenin's guttural "r" — the key element of what Russians refer to as "the Jewish accent" — is a running joke among Russian satirists; at least one of Lenin's grandparents was Jewish, which, as the satirists point out, would have made him eligible for aliya. To those who gathered both at Sparrow Hills and at the Chez Sergei cafe, where the Russian Jewish Congress was planned, the situation looked familiar.

Among those in attendance at Chez Sergei was Yevgeny Satanovsky, a successful but not quite oligarchic businessman who used the profits from his chemicals and metallurgy business to fund his Institute for the Study of Israel and the Middle East. Now president of the Russian Jewish Congress, he shrugs off the fears expressed by Gusinsky and others and sees "the Jewish question" — the one we asked earlier — as clear-cut.

"This sort of thing happens any time you have repression and then revolution," Satanovsky told the Forward afterward. "When you have a group of people who are repressed and then those restrictions are suddenly removed, all the extra efforts they have traditionally made in order to succeed propel them ahead much faster than the general population. It's a natural phenomenon."

In an interview with the Forward more than a year ago, Israeli Ambassador to Russia Natan Meron put it even more simply. In order to illustrate how much progress had been made since the fall of the Soviet Union, he displayed the front page of one of Russia's leading business newspapers, on which he had highlighted the name of every Jew. There were too many to count.

"Isn't it wonderful?" he said.

There was a time, of course, when the only Jews who made headlines in Russia were the demonized victims of the Doctors' Plot and other antisemitic Stalinist intrigues. That they have been replaced in the news by the oligarchs is, on the whole, probably a blessing. But in telling the next chapter of the story, Hoffman's and Usherenko's books both show how much remains the same. Russia is still asking its "Jewish question." Whether or not the tone has changed, however, remains to be seen.

Equally unclear is the fate of the oligarchs themselves. Berezovsky and Gusinsky are in indefinite exile, after Putin seized both of their media empires. Smolensky, reviled after the catastrophic collapse of his bank, lives virtually in hiding. And Khodorkovsky, Friedman and many of the others now have minority shareholders and audit their companies by Western standards. The oligarchs may not yet be on the ash heap of history, but the days of the meetings up on Sparrow Hills are clearly gone.

Hereward

2003-02-04 04:41 | User Profile

wintermute - No links, just word of mouth. A friend of mine was in the State Department during the Clinton administration. He was lower ranking - started as a visa stamper and moved up to cover nuclear, biowarfare, environmental, and a bunch of other issues. He's now elsewhere in the gubmint, and for the record he's a Gentile, and the first person of my acquaintance to compare the Israelis to the Nazis. He has lots of info about the shenanigans the Clinton crew got up to with the Russians. Gore was basically running a private and unaccountable foreign police with Russia, and routinely ignored in the rudest and stupidest ways the evidence of Russian corruption and mendacity when it was presented to him. My friend cannot provide me with many details, since the worst stuff is not disclosable.

Avalanche

2003-02-06 15:23 | User Profile

From [url=http://www.gnxp.com/MT/archives/2003_02.html]http://www.gnxp.com/MT/archives/2003_02.html[/url]

February 02, 2003 "Market dominant minorities"

Steve Sailer has an important article on the difficulty of reconciling majority rule with economic inequity when it is benefits an ethnic minority. This is important, because if the plutocrats are the same race as the proletariat, then the Horatio Alger idea becames more tenable as one can not tell by just looking at someone or knowing their last name that they come from a long-line of plutocrats who did not rise up from the poverty of the masses (though they might have risen up from the poverty of the elite minority, which often displays income inequality as well). Steve mentions the difficulty of keeping the majority pliant as in Latin America, and how it is fast failing because of mestizo and black ethnic awareness. But this New York Times Magazine article (requires registration: http://www.nytimes.com/2003/02/02/magazine...tion=top") about Hindu nationalism shows a primary method for keeping the hereditary elite in power: find a scapegoat [1]. In the case of India right now, that would be Muslims, who the upper-castes use to create Hindu solidarity in the defiance of the fact that from a Marxist perspective low-caste Hindus and Muslims share economic interests (and until the rise of low-caste parties these two groups were part of the bedrock of the Congress vote that helped create that party's near monopoly on power for 50 years) [2].

[1] I will address this article at some point if the idolaters do not demur.

[2] Most of India's Muslim elite (and middle-class) fled to Pakistan. So India's Muslims tend to share the same socioeconomic (and likely racial) profile as the Hindu lower castes.

From the comments:

Mishra makes a major mistake - he believes that as goes Gujarat, so goes India. That is akin to suggesting that as goes Dixie, so goes America. The majority of the Hindu nationalist movement draws its members from the Gujarati community, both within India and from the deep-pocketed Gujarati diaspora. The BJP does not have much of a following outside of Gujarat.

Anutoush Varshey of the University of Michigan has studied the history of riots in independent India. His research found that riots in India are largely an urban phenomenon. Considering that 70% of Indians still live in villages, that is no minor detail. Second, Hindu-Muslim tension is largely a North Indian problem. While Punjab and Bengal exploded in bloodlust during partition (since their states were split), South India was almost untouched. (This may be due to the nature of Islam's introduction to South India. In North India, Islam came as a political and military force. Battles were fought and lost, but the Mughals eventually established an empire. Such events provide rich material to nurse Hindu grievances. In South India, Islam came with Muslim traders. They did business with the local Hindu population, but no attempt was made to change the political order, or convert the "kaffirs.")

Not only are Hindu-Muslim riots largely relegated to cities, the same cities keep appearing over and over. Ahmedabad in Gujarat has a terrible history in such matters, stretching back to era of British rule. In 1992, Bombay saw terrible riots, with Hindu mobs burning Muslim neighborhoods to the ground. Muslim gangsters retaliated by destroying the Bombay Stock Exchange, killing nearly 300 people. After that, the police force set up hotlines with religious leaders in both communities, so that in the future, any potential flareup could be kept in check. So while Gujarat was witnessing a pogrom of Muslims last year, Bombay was kept calm - as was the rest of the country.

The most important finding is that riots in India are not spontaneous events. They are planned by political bosses - orders are given, money is exchanged, and the police are ordered to stand down. That is what happened in Gujarat last year. Compare the response to later that year, when Muslim gunmen entered a Hindu temple in Gujarat, killing over 30 devotees. Due to the tremendous international embarrassment that India suffered earlier in the year, Vajpayee made it clear there would no large scale Hindu retaliation.

As far as the decline of the Congress party - this is a welcome development. Indeed, by the late 1960's, the majority of Indian states were run by non-Congress parties. It's ability to govern at the center relied upon dynastic politics, which is not healthy for either the party or India as a whole. It could not deliver prosperity, education, or communal harmony. Whatever extremists the BJP may have, they must be tempered if they hope to gain power at the center.

Despite its ability to grab headlines, Hindu nationalism is a fading phenomenon. That does not mean Indians should be lax in guarding against the more vicious elements. But hyperventilating by the Pankaj Mishras and Arundhati Roys of the country portrays a misleading picture of the reality on the ground.

Sailer: "One reason: we are one of the fairly small number of lucky countries with "market dominant majorities." We can have our cake (capitalism) and eat it too (democracy) because our majority group is economically quite competent...

In contrast, if our current mass immigration system is allowed to continue, America will become just another country with a market dominant minority. Through government policy, we will have inflicted upon ourselves the kind of ugly society seen in most of the rest of the world."

This is Sailer best recent work. My ideas about the future role of Latinos in America are not conclusive. However, I would ask M or Chaillet or anyone else what do we do in case they are incorrect to fix our future economic problems?

Our White majority is in numerical decline (like all relatively high IQ groups around the world). How do we stave off the economic nightmare Sailer alludes to?

I already offered one solution (short of Whites having more kids)- mass immigration of certain S/E Asian groups. But, while this would likely solve our future economic straits, it would cause massive cultural shifts (I could see Razib 'paddling the Pacific' for blonder pastures if too many high IQ 'browns' invaded his all White hamlet.