Mao, Marx, and the Market
Dean Lebaron with Donna Carpenter
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Buy *Mao, Marx, and the Market: Capitalist Adventures in Russia and China* online Mao, Marx, and the Market: Capitalist Adventures in Russia and China
Dean Lebaron
with Donna Carpenter
John Wiley & Sons
336 pages
December 2001
rated 5 of 5 possible stars

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Imagine a mystery thriller whose corpse is an idea and whose mystery is not whodunit but who didn’t (clue: millions of hyphenated apparatchiks—card-carrying, chair-warming, and self-serving). Then add to these (a) who will take the recently vacated warm chairs, and (b) what will they most likely do?

For further details, read this book.

Curled Up With a Good BookIt’s not news that ideas have lives, too. Most follow the bell curve of civilization and life itself, from exploring toddlerhood to brash adolescence to productive maturity to declining vigor, and in a few cases, to the fear-based hostility of old-farthood. Some expire quietly with at most a whimper. Others go out leaving a godawful mess.

Dean LeBaron, private eye wearing the cloak of an investment banker, has two mysteries on his hands in this book. One is how China has managed with such a minimum of fuss its transition from fanatic Sinic communism to frantic Sinic capitalism. The other is why Russia has had such a devil of a time reinventing itself as a modern state after its Slavonic version of communism put a gun to its head in 1991.

These issues have been addressed before, but (a) not from the perspective of someone personally involved in both transitions, (b) without the wealth of astute judgment Mr. LeBaron draws out of otherwise trivial or tangential observation, and (c) most definitely not so well written. It is hard to say whose eye is the most observant in this regard, Mr. LeBaron’s or his not-so-ghostly co-author Ms. Donna Carpenter, but the result is a book that tells us things that no other book does, and does so entertainingly.

Take an example from page 183, Mr. LeBaron describes a visit to the Palace of Children in Shanghai where the children in his group are introduced to some Chinese girls “dressed like ballerinas. It was clearly a friendly gesture, and I was pleased to see that our hosts were trying hard to impress foreigners.”

Many visitors to China have experienced cultural outreach like this in one form or another. Most dismiss it as pious propaganda. Mr. LeBaron draws the true lesson from these tots in tutus:

“The message of this display was that the Chinese valued their children, and at the same time, valued Western culture ... [they] wanted us to know how much and how well they cared for their children; in other words, they cared how we regarded them.”
There are hundreds of piquant observations in his book. Where else, for example, have you read that Deng Xiaoping was shorter than Napoleon? Where, too, could you find the Soviet Union so aptly summarized as “motivated more by fear of loss and blame than by succeed and gain”? The common thread throughout is that Mr. LeBaron understands how to interpret a cultural statement as well as he does a financial statement. For example, on one of his trips to Russia during the Gorbachev years an earnest young fellow tells him, “Just tell us what we have to do to do business with the West, and we will do it.” Mr. LeBaron makes no cultural judgment but rather observes, “... the Russians didn’t follow through, the Chinese did.”

The fatal phrase was “Just tell us.” Mr. LeBaron’s experiences in China revealed no such waiting for the instruction manual to arrive. Their eagerness to do things their own way is a river of dynamism coursing through China, and is amply illustrated in this book. Perhaps Chinese self-reliance is just as well, since the advice being dispensed by the West is not always so apt. At a Russian conference on converting former military installations to civilian uses, he points out, “... some American speakers argued against converting military plants, maintaining that it could not be done for several reasons, one of which was that unions would not agree to the necessary changes in job descriptions and pay scales. The Soviet speakers, by contrast, tended to ask, ‘Why not? If the world wants fewer weapons and more consumer goods, let’s oblige.’”

American advisers and consultants tend to pronounce on matters over which they are either poorly informed—such as what union members think without ever having attended a union meeting. They often don’t grasp or simply ride roughshod over deep-seated cultural underpinnings. This is a much larger obstacle to Western interests than most American media (to say nothing of consultancies) are willing to admit. The Russians were as confused by the mixed signals they got from American advisers as the Chinese and Southeast Asians. Then came the economic crisis of 1997–98. The patently counterproductive mandates from the IMF, World Bank, and the Western financial community convinced Asians that, given their cultural patterns, Western advice was often the exact opposite of what was needed. They responded accordingly by embracing Western technological means but taking its social ideas with a grain of salt. The result has been culturally directed economic advance. China is now the fastest-growing investor in Southeast Asia, and Asians from Japan to Indonesia are quietly forming an economic bloc that will rival the EU in size and exceed it in self-discipline.

The implications are, from the Western point of view, upsetting. The Western concept of social stability is based in part on the view that a person has no meaning or dignity without a strong measure of individual liberty. The Western concept of economic stability is relentless growth come what may. The Asian pattern, Mr. LeBaron points out, is substantively different: “Through the centuries the Chinese frame of mind was formed around the idea of balance—a dynamic equilibrium ... China knows what must be balanced—the rich and poor, efficiency and unemployment, growth and inflation, stability and liberty. If the Chinese can synthesize these opposites, they will have accomplished one of the great feats of modern history. For now, my money is on China.”

Co-author Donna Carpenter has a sharp eye for detail and how to extract the valuable insight out of random personal experience. Under her guidance, Mr. LeBaron turns the turgid jargons of most business and academic books into anecdotes of real people signaling with actions today how they will likely act in the future. Chapter 15 is a gold mine in this regard, for here are summed up in “megatrends” style the primal cultural underpinnings that yield the deeply ingrained responses of today’s behavior, and will no doubt continue to do in the future. For example,

“The Chinese learned from the Great Leap Forward to take small and steady leaps. The Russians were addicted to grand gestures, which have ultimately led to epic ruin. ... Russia will remain the Sick Man of the World, dangerous because it is weak, disoriented, subject to spasm. ... The Chinese may adopt democracy so gradually that no one will notice.”

Mr. LeBaron does something few “experts” ever do. He splashes through the muddy roads of reality on his way to the gilt corridors of power. Most consultants never venture out of their five-star hotels. The result is a meticulous and perceptive dissection of the psychological mechanics of economic planning. There are times when so much went awry that the sole shred of optimism in him was that of someone who has no clothes, one apple to eat, and still insists he is in paradise. Deng Xiaoping surely experienced the same feeling, for his notion of reform was, as Mr. LeBaron suggests, a bottom-up one—build an economy by building a large buyer base, which in time becomes a middle-class society. In other words, a consumer economy, which, from the non-Western point of view, has the happy property of enabling prosperity without requiring a specific idea of polity.

The resulting “value-adding ladder” system of recently-well-off community investing in less-well-off community is the fundamental basis of Asia’s economic rise to stardom between 1970 and the present, and is a hitherto ignored argument why globalization does more good than harm over the long term. Anti-globalists who criticize “greedy capitalism” miss the point. The negative effects of international trade derive from the mindset that flourishes when institutions become too powerful to be challenged, and to arrogant to restrain themselves. Since that description most accurately applies to the Western corporate structure, it makes for salutary reading to delve into Mr. LeBaron and Ms. Carpenter’s book. There you will see how two polities with vastly different cultural roots are applying the best of the West while ignoring the rest.

© 2002 by Dana De Zoysa for Curled Up With a Good Book

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