Thailand: Rationalism Or Nationalism


Alison Broinowski

On 6 January Thais elected telecommunications multi-millionaire Thaksin Shinawatra as Prime Minister, a man accused of false asset declarations. For five years at least, their government had been losing between $US150 million and $175 million each year in tax revenue due to the smuggling of oil in which many Thai politicians and business people were reported to be involved. The ‘hidden’, informal economy, by the time of the election, involved much more than smuggled oil, and it was estimated to add up to as much as the income accounts and GNP tables by which formal national economies are usually measured.

A courageous team of Thai economists, some of them Australian-trained women, has been working since the mid-1990s to quantify the cost to the Thai economy of illicit commerce in gambling, prostitution, drugs, armaments, and timber. They found that the organised criminal networks that operate in these murky areas are adept at bartering guns for amphetamines, oil revenues for police protection, and gambling profits for girls, boys, and women. This is customary trade, based on decades if not centuries of practice. Only the influential Thai media and a few principled politicians have stood between the researchers – Pasuk Phongpaichit, Sungsidh Piriyarangsan, and Nualnoi Treerat of Chulalongkorn University – and their subjects’ desire to suppress them.

Even before the economic crisis of mid-1997, these economists were pointing out what Thailand’s refusal to reform was costing the country. To argue – as some inside and outside Thailand had often done – that the Thai Way required the exchange of favours for services, respect for patronage, and connections for confidentiality, was to hope to go on living in the charming Thailand of the past. But Thailand was irrevocably exposed to the international economy: that included Japan’s long downward slide, the caprices of foreign financial traders, and venality and greed in the West that matched anything in Asia. Chuan Leekpai’s relatively new government spent more than $US20 billion on defending the baht, which collapsed anyway on 2 July 1997.

The issue confronting Thais in their January 2001 election was whether to acknowledge what had to be done to change the system, or to deny it. By giving or selling their votes overwhelmingly to Thaksin and his Thai Rak Thai (Thai Love Thai) party, they surprised some observers by opting for denial. They rejected Chuan Leekpai and the Democrat Party’s slow-paced recovery, and the advice of Chulalongkorn’s foreign-trained economists. Apparently knowingly, they accepted continuing corruption on the grounds that at least, it was Thai. At the end of the month, elections re-run in 62 constituencies because of fraud resulted in Thai Rak Thai losing 32 of its winning seats, but regaining enough to be just short of a majority. This will enable Thaksin to dictate the terms of a coalition cabinet.

Proof of the national mood was produced when the arch-villain of currency traders, George Soros, cancelled a visit to Thailand in late January to address the Foreign Correspondents’ Club. The Governor of Bangkok in 1997 had threatened to punch Soros’ nose if ever he came to Bangkok, and when this visit was announced, protesters planned to pelt him with rotten eggs and worse. Hostile websites offered rewards to anyone who repeated the feat of a cream pie in the face, delivered last year to IMF President Michel Camdessus. Soros was ‘the big-nose who busted our baht’. One protestor on the Internet accused Soros (whose business empire has imploded and is now worth only $US5billion) of ‘destruction of Thailand’s sovereignty’. Understandable as this racist rage may be, rationalist responses to Thailand’s problems are, it seems, out of favour, and nationalist ones are in.

WATCHPOINT: With other leaders in the region facing accusations of corruption, how long will Thaksin be able to resist investigation?


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