The Future is Asian

Date Reviewed
October 7th 2019



'The Future is Asian' by Parag Khanna is a comprehensive book reflecting the size and complexity of Asia and how inclusive he is in portraying it. The Arctic, Israel, Japan and Australia/New Zealand are on the margins of Khanna's Asia.


I would put this book in the top half dozen of the best in the last 100 I have read. Without excusing 'bad behaviour in western eyes' the author tries, and succeeds to a large extent, to explain it, and the characters involved, in an illuminating way.


That western readers may balk at some of these inclusions already suggests the purpose of Khanna's book. And that is to show that western ideas of Asia are full of misconceptions, that given the speed of change in Asia are getting farther out of touch with reality than the west's ideas about other parts of the world. “Haughty ignorance” centring on London and Washington is how he characterizes it.


Our language to describe these countries may have gotten more politically sensitive over the years as it went from 'under developed countries', to 'developing countries' to 'third world'. It has now been called the 'second world'. Western knowledge of the change, at least at the ground level, seems to be encapsulated by the idea that “people getting a dollar a day are taking our jobs and sending us cheap copied stuff”.


There is barely a realization that dollar-a-day labour is fast disappearing at least with many of our competitors. And countries thought of as poor based on conversion of their currency into western money have standards of living edging up on our own when what they can buy with their money in their country is approaching what we can get in western countries. This is referred to as 'purchasing power parity' (PPP).


These changes will become more apparent and rapidly so. As a whole, says Khanna, Asians more comfortably embrace technology. At the same time, they are skipping many of the technologies, such as hardwired communication, which in western countries are the property of powerful vested interests not yet ready to abandon that cash flow.


Further advantaging many Asian countries is the move to 'technocratic governance'. These are governments, that while they rely on the support of the populace, are not responsive to hot button and immediate, transient populist issues, that can rule and gridlock traditional democracies.


These governments have civil services recruited on expertise and promoted on experience, hence moving toward more qualified experts. Also referred to as 'meritocracy', some may hold elections of varying degrees of 'free' or widely representative. But in any event, government decisions are made by people not immediately or directly accountable to the populace. At the same time, they have to remain apprised of what the people want and will accept.


While China is the most quickly recognized user of this form of government, it is not the best example or pioneer of it.


That was Singapore and the leader who launched it from post colonial days was president until 1990, Lee Kuan Yew. Until his death in 2015 he was still a member of parliament. He was the mentor and go-to-guy for many leaders around the world, a notable one being Deng Xiaoping who revolutionized the Chinese economy from the 1980s.


Khanna refers to Singapore as the “capital of Asia” and still the best example of this type of meritocratic governance.


The author, born in Singapore, is an academic and planning political strategist working in the U.S. He travels extensively in Asia and has worked there.


Because his book tries to encapsulate the history and experiences of so many countries it is dense with facts, so dense that it would not have been much briefer had it been written in point form. And at times it almost seems like a list arranged in paragraphs.


Of particular interest to those with a scant knowledge of Asian history, or the part it has played in the world, is his 37-page first chapter, 'A History of the World;An Asian View'. Rarely have I gotten so much information in such a short read. He spices it with intriguing little factoids and surprising connections.


One fascinating event that still percolates in China was that German held Chinese territory, after the first world war, was handed over to Japan rather than given back to China as promised for its support in that war.


The other chapter I found most elucidating is 9 “Asia's Technocratic Future”. It is 45 pages that explains the nature of governance that is progressively taking over Asia and the west sees as a turn back to dictatorship.


While I find little in this book I feel qualified to dispute, I expect the tenor may paint a more evolved state than is actually the case when viewed close up. I think this kind of presentation designed to present a revelation is susceptible to overplaying the case. But without doubt Asia's progress and standard is misrepresented, misunderstood and out of date in the west.


At the outset of the book, Khanna introduces China's mobilizing infrastructure investment plan for Asia and Africa.... 'Belt and Road Initiative'. It was launched in May 2017 in Beijing with 68 countries representing two thirds of the world's population and half its GDP. The author calls it the most significant “diplomatic initiative of the 21st century” and refers to it throughout the book.


Some of these countries are contiguous along the original “Silk Road” from China to Europe.


The end of the cold war has allowed many of these countries to start/resume a co-operation that had existed before. This is a product of “economic growth, geopolitical stability and technocratic pragmatism” This also gave rise to economic globalism.


Currently Europe is the most integrated regional system, he says. North America is the next most integrated.


Asians see Asia's return to leading an order or system encompassing the majority of the world's population. This sense will grow, he says, as Asians increasingly socialize with each other.


He adds that western intellectuals see material circumstances improving from the ideas of the west. But Asians are learning there is not necessarily a correlation. The Western liberal international order is waning.


And an interesting summation of different types of power “The United States is still the leading global military power with the deepest financial markets and largest energy production. Europe still leads the world in market size, the quality of its democratic institutions, and overall living standards. Asia in general and China in particular, boasts the biggest populations and armies, highest savings rates, and largest currency reserves.”


While Asia has relied on U.S. providing security, capital and technology this is declining, and faster than the West realizes, he says. He refers to “willfully cultivated ignorance” about Asia.


Despite western worries, China has little loyalty from its neighbours to be the leader in Asia.

One of the characteristics of Asianization is governments taking a “stronger hand in steering economic policies”. This may be characterized as practicing “neomercantile industrialism” rather than free-market capitalism, a differentiation most westerners are yet appreciate.


An interesting forecast...”some aspects of global Westernization will remain central to global life, especially the English language, capitalism, and the pursuit of scientific excellence and technological disruption. But others will fade, such as the appeal of American style democracy and unsustainable consumerism.”


With Asia agriculture started about 6000 B.C. In peninsular Southeast Asia, 5000 B.C. and about 4,000 B.C. in China and Japan. The largest centres in 3500 B.C. were in present day Pakistan.


Khanna sheds light on Asian perspectives on events the west perceived as good or tried to put such a spin on. Japan's part in the second world war essentially ended colonialism, but it was replaced by the west's anti-communism initiatives.


The end of the cold war led to realignments that pushed the Asian countries toward centre stage again.


It was only from the industrial revolution that the west displaced Asia as the leader in most developments in civilization. Until about 1800 trade flows in Asia dwarfed that of Europe.


Asia's resurgence is being enhanced by a growing participation by Russia, particularly in oil and gas sales to China and Japan. It is also a major and growing factor in grain exports, most to Asia.


Turkey the other major power straddling Asia and Europe is orienting more to Asia as is Israel.


One indication of the orientation is that Saudi Arabia is moving toward pricing oil in Chinese yuan rather than the so-far-always-used U.S. dollar. That part of the world says Khanna, is becoming less dependent on the U.S. and finding more partnerships in Asia. Despite U.S. sanctions, Asians are finding ways to work with Iran.


Khanna regularly stresses that while China seems the leader the other countries watch their own interests carefully and focus on the Asian connections all share. He doesn't expect a dominating leadership for China or the U.S. in Asia, but a more collective shared leadership. Even if China tried to assert itself, the animosity it could generate would not make it worthwhile.


He points to Southeast Asia, with its 700 million people, as having cross border integration and stability reminiscent of the early decades of the European Union despite being the most ethnic, linguistic and religiously diverse corner of the world.


Despite its proximity physically and culturally Vietnam is the most pugnacious when it feels China has overstepped. Khanna says all of the countries become more able to resist China as they get wealthier. Australia, to be accepted, has to acquiesce to a more diminished role within Asia than it had hoped. Its economy is highly dependent on relations with China. That may also be linked with a diminishing role for the U.S. The countries see the U.S. as important, but says Khanna “unpredictable and incompetent”.


He says the U.S. bringing Japan and South Korea together is one of “genuine successes of U.S. Asian diplomacy”. The youth in China, Japan and Korea don't harbour the animosity of earlier generations.

But the U.S.'s strategic influence is declining as its economic dependence on Asia increases.


Singapore is the region's diplomatic hub hosting meetings especially between disputants.


While Donald Trump blames globalization for U.S. deindustrialization and trade imbalances, it has been the ticket to prosperity in Asia.


Asian mixed capitalism countries have focussed on state-backed companies to ensure national control over critical industries. Most are more open than China. Many of the large businesses in Asia are family owned.


“Asians widely hold the view that markets should be subordinate to overall societal well-being, rather than held up as ends in themselves.” They are also pro-globalization because their governments are actively steering it in their favour, says Khanna.


Essentially he is saying that the Asianization of capitalism results in more concern for the population than does western. They are not so laissez-faire.


Asians are refocussing investment in Asia and Europe rather than the U.S.


Western economists have portrayed Asia's rise as 'catching up' when in fact it may be leap-frogging. These areas include mobile instead of land lines, digital banking before ATMs, cloud computing before desktops, electronic road payments before toll booths and wind power instead of oil and gas. Myanmar went from one per cent penetration in mobile phones to 90 per cent in five years and banking apps are way ahead of banks and ATMs suggesting the demise of physical currency.


China is aiming to have 15 per cent of its energy from alternative and renewable energy sources by 2020. Currently 80 per cent of its renewable is from water.


An interesting fact..... both India and the U.S. have 12 per cent of the world's arable land while China has 9 per cent. However, both China and India are facing imminent water shortages.


He says that automation is unfolding in the west and Asia at about the same time. So the low skilled manual labour jobs are disappearing in Asia also. What isn't happening in Asia, but is in the west, is the demise of newspapers and vacating of shopping malls in favour of on-line shopping.


Khanna says one advantage Asians have in the evolving technology “they are not afraid of technology”. In conjunction Asian governments seem more supportive of R&D spending. Governments also key on the size of cities and when they have reached optimum, populations should be directed to smaller cities.


Asians are disciplined to work hard. Their civilizations were great in the past and they can imagine it again. This applies to work and education and pushing children toward educational and professional success. As well they are moving away from traditional drudge education to more creative and group work than in the past.


American educational achievements are enhanced by Asian immigration. In universities there is some conflict with whites complaining about affirmative action and Asians about lack of meritocratic standards, which favour them.


Khanna specifically highlights the Asian factor in Canada, particularly the mainland Chinese explosion in Vancouver. He also indicates the attempted interference with some of these Chinese by the Chinese government seeking extradition rights.


Both Canada and the U.S. benefit considerably from tuitions paid by Asian students. The U.S. has lost many in recent years, especially with the Trump presidency. Graduates are increasingly going back home.


“Vibrant and populous cities with ethnically diverse residents (such as Vancouver and Toronto) rank at the top of the table when it comes to liveability and creativity”, says Khanna.


An interesting idea “The difference between today and a generation ago is that it is unclear whether today's western millennials decamping for Asia will ever return.” and the reason “That hallmarks of expat life such as low taxes, high quality of life, public safety, rigorous education, and efficient governance that one finds in key Asian hubs.”


China has a policy to attract foreign entrepreneurs, scientists and innovators to take up residence. Khanna says “almost every Asian country is opening its arms to attract talent from far and wide”. “Clever, adventurous, risk taking entrepreneurial” are characteristics sought (opposite to the west). “It takes both courage and brains to make it in alien countries operating in exotic tongues.”


Europeans are starting to see Asia as a more stable long-term value proposition than the U.S., he says. And Europe will profit more from Asia's rise than the U.S. And China is moving investments from the U.S. to Europe.


Some European companies are moving away from the U.S. so they can trade with Iran. Along with Europe..... Russia, Turkey and Africa, since the early 2000s, are all turning to the east. And the interest in Africa is mutual. Both Japan and India enjoy a warmer image in Africa than China.


While we hear of choking pollution and traffic congestion in Asian cities, there is pressure from within to make them more liveable.


The evolution of Asian governance is going to confound much of western society. Asia doesn't have the individual liberal tradition that spawned western democracy. And while they are not opposed to incorporating it, they, at least now, have “as no-nonsense bias in favour of pragmatic government and are culturally cautious about becoming collectively undisciplined”, says Khanna.


Both Taiwan and South Korea score high on measures of “democratic consolidation and state effectiveness”. “Democracy”, he says, tells us less about how well a country is run. Some discontent with this is now expressed in the west, while some other more autocratic governments are getting high marks from their populace and it doesn't all seem to be a measure of freedom of expression or lack.


Countries rated high by western analysts on global influence in this area , he says, include China, India and Singapore, all higher than the U.S.


Western democracy has three main faces; multi party in much of Western Europe, constitutional monarchies in Nordic counties and the U.S. presidential republicanism. He describes Canada as closer to the western European model than to either the U.S. or Britain.


In outcome for the population as a whole, he says, the U.S. is declining in good governance more than the other developed western countries. He says the U.S. is “suffering from an abundance of representation and deficit of administration”.


It has been said that the Chinese favour material stability over democratic instability and this idea is becoming widely popular. Democracy is not favoured when it comes with corruption and incompetence. So more autocracy is being considered in many countries including western.


One of the characteristics of this governance, says Khanna, is focus on “longterm vision and collective benefits rather than short term hyperindividualism and narrow special interests”.


Today what this is leading to is 'technocratic government' (pioneered in Lee Kwan Yew's Singapore). This features expert analysis and long-term planning rather than narrow minded short term (ad hoc and reactive) populist whims or private interests.


It is a meritocratic system with promotion based on competence. “Technocratic leaders are selected more by IQ test than by popularity contest. They are extensively trained, and experienced professionals, not just pedigreed elites.”


When democracy is failing turn to technocracy, he adds.


Yew explained “law and order” as 'order' matters first them 'law'. The Singapore system is the most widely admired and studied across Asia. It “institutionalized technocracy before allowing democracy to unfold fully”. Technocracy is more flexible and capable of changing course than democracy.


“Too much politics corrupts democracy, and too much democracy gets in the way of policy.”


While Singapore is a top ranked free market, the government manages the economy through state-backed companies. And interestingly described as a “libertarian nanny state in which capitalist self-reliance fuses with redistributive handouts and a large official role in the marketplace to ensure the stability of government revenues.”


Technocracy holds up the same ultimate goals in services that traditional democracy does, but holds delay in getting them done a form of corruption.


Singapore, he says, runs constant surveys on satisfaction with service “and actually pays attention to the results”. The government seeks feedback in consultations and survey on all major policy questions.


With expertise, maybe should go pay, salaries of Singapores ministers and senior officials were slashed by one third or more in 2012 and they are still the highest paid public servants in the world. He characterizes he U.S. public service as overworked and underpaid. He describes Margaret Thatcher “as dismantling the once vaunted cvil service”.


Elections, he says, often punish rather than prescribe and a referendum on individuals as much as issues. “Voting by itself is therefore far from the best means of capturing public sentiment on an ongoing basis.” Collection of data continually, made easier by technology, is a valuable complement. It, he says, captures desires of people without distortions of hot button issues, and corrupted representation and special interests.


“Technocracy is well suited to Asia's deferential cultures.” By that I think he means cultures more accustomed to following authority.


While remaining authoritarian China has brought diverse backgrounds in engineering and management into the upper echelons of leadership. In addition, it continues to study western capitalism and social democracy. As a result it is policy agile in responding to a variety of crises.


However, preservation of order remains paramount and some of what the west labels infringement of human rights is a product of that. And despite that it has done well in infrastructure, education, health care and technology, he says.


He references Canadian political theorist Daniel Bell saying how meritocracy, experimentation and decisiveness have boosted Chinese modernization that might have been hindered by democracy. Bell uses the term “compassionate meritocracy” to describe a situation where officials are rewarded for demonstrating corruption-free behaviour and actions taken in the public interest.


He compares this with the U.S. where each new president replaces the entire cabinet and the top 4,000 positions with his/her own appointees with many not knowing their responsibilities or the ability to learn them.


This contrast may explain why Chinese have more respect for their government than Americans do, he sadds.


He says look to technocracy to be Asia's future. The west may choose to paint technocrats as autocrats.


An important indication of fault “Palestinians in Israel, Kurds in Turkey, Rohingya in Myanmar, Tibetans and Uighurs in China and Tamils in Sri Lanka, to name a few terribly victimized Asian peoples. These countries' regimes either explicitly seek ethnic, religious or racial purity or simply pursue it in the name of political stability.”


But, he says, there have been steady gains in political rights and civil liberties manifesting in political parties and freedom of association. And fortunately the best example is the one most followed, Singapore. But nevertheless politics remains strict in supporting stability. There is such a thing as too much freedom, he adds.


Rule of law, especially around private property, rather than democracy, most drives economic performance. Becoming more technocratic may blunt the autocratic nature of some leaderships.


He calls Turkey and Iran “wayward regimes living on borrowed time”.

Where there are not dangerous proscriptions more people across Asia, especially young, are speaking their minds on issues. In China, “the government listens, takes constructive comments on board and cracks down on criticism, all at the same time.”


Certainly the Chinese are using technology and data to control the population, much of which we disapprove of and some, less well known, we might applaud such as clamping down on restaurants selling contaminated food or vendors selling counterfeit goods.


Khanna says Asians are watching how digital technologies have contributed to a societal decline in the west, that they don't want to follow.


“Westerners don't want to hear that Asians are taking on greater leadership in setting global rules any more than they want to hear that the United States is disengaging from crucial aspects of global governance_but both are happening.”


While China and India are politically bludgeoned for their domestic contribution to GHGs, they are not so readily praised for manufactures relating to renewable energies sold worldwide that reduce GHGs.


There is an increasing Asianization of Asia with intermarriage between ethnic groups increasing rapidly. Vietnamese women make up the largest number of international brides for South Korean men. There are now a million multiethnic families in Korea.


Where assimilation used to be a taboo in Korea and Japan it is now a necessary reform, says Khanna. From 1990 to 2017 the rate of intermarriage in Singapore has gone from 7 per cent to 25 per cent. Studying across countries has increased the trend.


And Asians are travelling. The revenue from tourists of China, Japan, Korea and India is now triple that of American tourists. The world's most travelled to cities are Hong Kong, Bangkok, Singapore and Dubai. Only London is in this class.


He also says that as Asia becomes a more attractive tourist destination it is learning not to destroy habitat the world is eager to see.


On a cultural level Asians are starting to accept their own brands over imported ones and in some cases blending them.


Having an Indian film shot in your country provides a boon of Indian tourists the next year. “Ethnocultural pride is supplanting long-ingrained to colonial norms.”


“The western world order no longer exists and will not return. It was as contingent as any other era, and we are better served by aspiring to a more inclusive and stable horizon. Be wary of those who believe that history repeats itself.”


He also says there has never been a global system so imprinted by multiple civilizations.


One of the main differences between the east and west is the primacy the west places on the individual at the centre, as opposed to the family or community of the east.


Asia benefitted from outsourcing from the west which is now in turn benefitting from investment and talent from Asia.


“We are in the early phases of global Asianization.”