Capitalism in the Socialist Republic

95% of Vietnamese tell pollsters they back a capitalist system: more than any other nation in the world. How to square that with the fact that Vietnam is still notionally Communist?

The Saigon skyline now dominated by block of luxury flats and the offices of large companies

That most guidebooks to Saigon recommend going to see a building called ‘the Ho Chi Minh City People’s Committee Head Office’* is perhaps somewhat surprising. Its name makes it sound like it should be a rather ugly piece of concrete brutalism. In fact, it’s a rather stylish piece of colonial architecture built by the French to serve as Saigon’s Town Hall. That’s still basically the job it does today. When the city fell to the Communist’s in 1975, its municipal government was rebranded as the ‘People’s Committee’ and made subordinate to the Party but kept its old base. However, it did not keep the prominence it once had. The People’s Committee building is now dwarfed by the Vincom Centre, an upmarket shopping centre just over the road.

That a commercial building, which is far from the largest in Saigon, now looms over the centre of state power in Vietnam’s largest city is a fitting symbol for the extent to which global capitalism has made itself at home in the country. A private sector that the Communist Party once tried to abolish is stronger than ever. As wages in China have risen, it has become a less attractive place for many of the Western firms looking for a place to outsource jobs. In many cases they have turned to Vietnam as an alternative. While doing teaching training in Hanoi, a traditionally less commercially orientated city than Saigon, I found that most of my classes were learning English to help them get jobs in finance. And a freewheeling informal capitalism of street stalls and small shops is still very much alive.

What is truly remarkable, however, are Vietnamese attitudes towards the market economy. 95% of those Vietnamese surveyed by Pew agreed with the statement “most people are better off in a free market economy even though some people are rich and some are poor”. That’s more than in any country surveyed, double the share in some countries like Spain and Greece and 25% than in the supposedly uber-capitalist US. That a communist country should be home to the most consistently capitalist people clearly requires explanation.

Support for Free Market System

Part of it may be that a market orientated approach is clearly getting results for Vietnam. It has not quite matched the staggering rates of economic growth achieved by China but it is not far behind. At present it is doubling the size of its economy roughly every decade.

Conversely, the Vietnamese have had recent experience of a socialist approach not working. Having gained control of the south of the country in 1975, the Communists would attempt for almost a decade to impose socialist policies upon it. This resulted in precisely the kind of inefficiency one associates with centrally planned economies: shortages, unfilled quotas and resources squandered on unviable projects. The country saw such massive inflation that a sandwich from a street stall now costs 20,000₫ and despite substantial Soviet support was falling deep into debt. The confiscation of private property and new restrictions on trade also proved provoked a substantial amount of hostility towards the party. Facing national ruin, the party changed course. Provincial party chairs in the south were given scope to experiment with more economically liberal policies. When these produced positive outcomes, their architects used them as a springboard for promotion to positions of power in the national Party. This in turn allowed them to disseminate these policies across the country as a whole.

A natural if rather smug conclusion to draw from this is that the Vietnamese have such a high regard for capitalism because they have tried the alternative. This is not wrong but I suspect the note of free market triumphalism is nonetheless misplaced. It doesn’t account for why the Vietnamese population view capitalism more favourably than do the Chinese despite the two countries’ similar trajectories and the fact that China has grown even faster.

I wonder if the difference is down to inequality. Vietnam is a substantially more egalitarian place than China. I’ve blogged before about the huge disparities within China: the average income in Macao is over $90,000, while in Yunnan it’s less than $1000. That’s the equivalent of having Luxembourg and South Sudan within a single country. The Vietnamese government has kept a lid on this in particular by more pro-actively redistributing revenues from richer regions to poorer ones. So while China now has levels of income inequality roughly on a par with the US, Vietnam’s levels are similar to those of European countries like Spain and Italy. The two countries also have similar life expectancies and literacy rates even though GDP per capita in Vietnam is less than half that in China.

One might therefore infer from the Vietnamese experience that the best way to prevent inequality eroding support for the free market is to prevent inequality from emerging in the first place.**

*Notwithstanding the official change of Saigon’s name to Ho Chi Minh City, I am referring to it by its old name as I figure this will be more familiar to my mostly Western readership and because it is still widely used in Vietnam.

**This suggestion should not detract from the fact that inequality has risen sharply in Vietnam since 1986. It has just not risen as fast as in many other countries.

Five big reasons NOT to vote Green

That it will hurt the Labour Party is not one of them!

Britain has seen a swing towards the Green Party comprised mostly of young people concerned with social justice and climate change disenchanted with mainstream politics. Here are the main reasons I think people these are precisely the kind of people who should be horrified to see the Party on the up:

1. Their policies on trade amount to locking poor nations out of the world economy.

We are currently witnessing the fastest reductions in poverty in human history as a result of export driven growth in poorer nations enabled by a new era of free trade. Despite this the Greens claim that “free trade means freeing the powerful to exploit the vulnerable” and want to create more localised economies. They would therefore put barriers in the way of those living in the developing world to export to West and harness its greater spending power to pull themselves out of poverty.

2. They oppose nuclear power, the most viable way to produce energy without worsening climate change.

In 2012 the environmentalist Mark Lynas recanted his opposition to nuclear power noting that 70% of low carbon electricity in the UK is produced by nuclear power and noted words of another convert George Monbiot that:

The efforts some people will make to destroy a low-carbon technology are remarkable. We are facing perhaps the greatest crisis humanity has ever encountered – runaway climate change – and instead of tackling the source of the problem (fossil fuels), environmentalists are attacking one of the solutions. People will look back on this era and wonder how such madness took hold.

The Greens are very much proponents of such madness.

3. Their policies would make Britain’s housing shortage worse.

House prices in Britain are rising to ruinous levels. The reasons for this are not hard to fathom: our population has grown but the amount of housing available hasn’t. Britain has extremely restrictive planning laws in particular our cities are encircled by Green Belts that prevent them from growing organically. So the laws of supply and demand take effect and prices rise remorselessly.

This benefits those who already own homes (who are generally older and richer) at the expense of those who don’t (normally younger and poorer). Thus the organisations that defend the Green Belt tend to be those who supporters are old and rich: the Conservative Party, the Daily Telegraph and the National Trust.

It’s, therefore, very odd to read the Green Party promise that they will “retain and rigorously strengthen Green Belt legislation.”

4. They’ve only held power in one place and have made a total mess of it.

To date the Green’s have led one council: Brighton. Their record wielding power there does not suggest they deserve more of it.

Erstwhile Green sympathiser Memphis Baker wrote in the Independent that:

In Brighton, the constituency of Caroline Lucas, the Green Icarus has flown close to the sun already. Bin strikes hit the city in 2013, leaving seagulls to peck at piles of rubbish: a plan to have a referendum on a hike in council tax was dropped as it would have cost more to run the vote than would have been recouped; Brighton’s recycling rate has actually dropped, with the council’s record now 302nd out of 326.

5. They are as likely to break their promises as any other politicians.

For six years I was a local councillor on an authority that had a sizeable group of Green councillors. In general I got on well with them but they were as prone to the kind of game playing that so frustrates voters. They could engage in gesture politics, scaremongering and fudging what they actually meant when it suited them. Most depressingly, their alternative budgets were often astonishingly implausible, piling optimistic assumptions upon imagined revenue streams. The example that particularly stuck in my mind was them proposing a hotel tax that the council had no legal power to impose!

In short, the reason that the Greens have not let the people who vote for them down again is that, outside Brighton, they’ve not had the chance yet. I strongly doubt that given power at a national level they would be able to deliver their pledge to bring down the deficit without cutting public spending. It would require them to raise vast amounts of extra tax revenue while doing a lot of things that would probably reduce the size of the economy from which they are trying to extract that revenue. In short, we should treat claims by Green politicians that they would end austerity with the same scepticism we would any other political claim.

Love, courage and cosmology: my review of Interstellar and the Theory of Everything

I was very ready not to like The Theory of Everything. For all the world it looked like a very polite biopic designed to impress Oscar voters and the Best Exotic/King’s Speech crowd. This turned out to be correct. However, it’s also a seriously impressive piece of work.

The appeal of a story about a genius battling a horrifying disease is evident. Nonetheless, there is temptation with films about interesting and multifaceted lives for the film to take an interest in every facet. Witness for example the meandering and unfocused Iron Lady. The Theory, however, finds a clear way through Hawking’s life by focusing on his relationship with his first wife Jane Wilde. Their shared affection and pain provide safe base from which we can explore Hawking’s science, his disease and his unlikely fame.

Yet ultimately it is this base that makes the Theory so fascinating. Eddie Redmayne and Felicity Jones deliver remarkable (and Oscar nominated) performances. Redmayne has to depict not only his character but also the disease that completely alters his physicality. Even when apparently completely immobilised Redmayne can still convey precisely what Hawking is thinking and feeling. However, it’s Jones who’s most remarkable. She shows just how difficult it was for Wilde to be the great woman behind a great man. She makes her seem strong without being saintly. Between them they produce a refreshingly different kind of story about a relationship: it’s not merely about falling in love but about love in its totality from the beginning of a relationship to its end and beyond.

This intensely domestic story is an apparent contrast to the massive space opera that is Interstellar. Ideas about blackholes or space-time which in the Theory of Everything are fleetingly sketched on a blackboard or explained with peas and potatoes are in Interstellar depicted in massive scale and detail. Yet pretty much as soon as I came out of the Theory of Everything, I’d bracketed the two films together. This was partly a matter of the role cosmology play in both. In fact Interstellar’s science advisor and executive producer Kip Thorne appears as a character in the Theory. He’s a collaborator and rival of Hawking’s and at one stage wins a bet with Hawking and receives a year’s subscription to penthouse as a prize!

More important, however, is the thematic connection. Both films are fundamentally about the determination to survive and how love can help us to find it. The quote from Dylan Thomas that Instellar uses extensively: “Do not go gentle into that good night, Old age should burn and rave at close of day; Rage, rage against the dying of the light” feels like a sentiment Hawking would probably have endorsed.

For all their similarities and the extent to which I enjoyed both films, I felt the Theory is the more successful film. Interstellar has plenty of fine performances but none as majestic Redmayne and Jones’. There are also points where Interstellar falls victim to the inability of a human brain that evolved in a Newtonian world to cope with the reality of relativity: at points where the drama requires us to be engaged, we are kept at a distance by the instinctive parts of our brain protesting: “this isn’t how the universe works!”

Yet of course this is indeed precisely how the universe works. The proposition that time moves more slowly for objects exposed to stronger gravity appears upon initial presentation like utter. Yet this effect is sufficiently real that the calculations underlying the GPS on your phone must include a correction for the slower passage of time experienced by satellites in orbit that are therefore at a remove from the earth’s gravity.

This is a point that both films illustrate magnificently: the human capacity to imagine that which we cannot experience. The substance of Thorne and Hawking’s bet is over whether a mysterious source of X-rays known as Cygnus X-1 would turn out to be a black hole. At the point not only was their uncertainty about whether Cygnus x-1 was a black hole but no one had been able to positively identify anything as a black hole. Yet by looking at the mathematics arising from Einstein’s work, Hawking and Thorne could be reasonably sure black holes did indeed exist. Thorne apparently gave some of these equations to the special effects team working on Interstellar who used them to create the images of wormholes and blackholes seen in the film. So through the power of both science and cinema we can look upon something that exists but which may never actually be seen by human eyes. Interstellar argues that it is this ability that allows us to invent paths out of apparently futile situations, while the Theory of Everything shows how it allows a man confined to a wheel chair to reach the farthest reaches of the cosmos.

Why a change of regime in Sri Lanka matters for the whole world

Good riddance

It’s hard to tell if the ejection of Mahinda Rajapaska from the Sri Lankan presidency should worry Putin or Xi more.

In recent years the world has seen a growing number of elected autocracies: governments that gain and retain power through elections yet repress dissent and seek to control institutions that should be independent of it like the media and judiciary. Examples include Venezuela, Hungary and most crucially Russia. However, as of this month there is one fewer example. The election for Sri Lankan president saw Mahinda Rajapaksa, who presided over war crimes against the Island’s Tamil minority and put most of the countries key institutions under the control of members of his family, lose to his former health minister Maithrala Sirisena.

Amanda Taub at Vox explains why Mr Rajapaska’s fate may have other elected autocrats looking over their shoulder:

There is a lesson here for other autocratic rulers. If you want to hold onto power, you should be at least as worried about the people who attended your last birthday party as you are about youthful idealists’ street protests.

It’s romantic to believe that popular uprisings like the Tahrir Square protests of 2011, Russia’s White Ribbon movement of 2012, or Ukraine’s Maidan protests of 2013 are the most serious threat to autocrats’ power. But Sri Lanka shows that, even in the case of power transfers that seem like the result of popular movements (in this case, a democratic election), the change is often actually driven by elites shifting their loyalties to a new candidate at a key moment.

Rajapaksa was brutally effective at crushing bottom-up democratic activism in Sri Lanka. But it turns out grassroots activists weren’t the people Rajapaksa really needed to worry about. Sirisena was a close ally who was a guest at Rajapaksa’s birthday celebration a mere two days before announcing his candidacy for president. Other elites quickly shifted to Sirisena’s camp, leaving Rajapaksa without support.

The same thing could happen to just about any autocratic leader.

Consider, for example, Vladimir Putin. He enjoys extremely high approval ratings, and is a beloved figure among ordinary Russians. And there is no one in Russia who seems powerful enough to be a possible Putin replacement, or any signs that Russian elites are beginning to doubt his rule.

But the same could have been said about Rajapaksa up to the moment when Sirisena announced his candidacy. It turned out that his popularity was fragile, and reliant on quiet but crucial support from key members of Sri Lanka’s most powerful institutions. When that support eroded, so did his popularity — in less than two months.

Putin’s popularity, like Rajapaksa’s, has been manufactured by pliant state media with the assistance of key allies among the Russian elite. The same elite-run forces that bolster autocratic leaders — supportive state media, a justice system willing to overlook corruption, helpful security services — can be used to take their rule away.

NYU professor Mark Galeotti, who studies Russia, told me recently that elite abandonment is far more of a risk for Putin than are the protesters who periodically throng the streets of Moscow. The real concern for Putin, he argued, should be that Russia’s elite power players — such as the leaders of the security services and major business interests — would lose faith in him, and decide that it was time to replace him with someone who offered better prospects for the long term.

This election result illustrates potential risks for Putin. However, the autocrat it poses the greatest difficulty for – asides obviously from Mr Rajapaksa himself – is China’s Xi Jingping.

In an interview with The Economist, [new Sri Lankan foreign minister] Mr Samaraweera spelled out how he expects Sri Lanka’s place in foreign affairs to change. For a start, warmer relations with India are all but guaranteed: he describes bilateral ties as “a state of irreversible excellence”, with the “strained” relations that were experienced under Mr Rajapaksa an “aberration” that must now be forgotten. “We must put our friendship back on track…we must accept the geopolitical reality”, he says. For India the most pressing concern is the heavy influence of China in its neighbourhood, especially after China deployed a military submarine, twice, to Colombo harbour in September. China has provided billions of dollars’ worth of loans and investment for Sri Lankan infrastructure, including a southern airport at Mr Rajapaksa’s hometown which Mr Samaraweera dismisses as a “white elephant”. Such projects will now be reviewed, he says. Dubious Chinese activities—such as unsustainable tuna-fishing by Chinese boats in Sri Lankan waters—will presumably end.

Sri Lanka’s ties with Europe and America had traditionally been excellent. A large share of its trade continues to be with the European Union. But under Mr Rajapaksa, who was accused of human-rights abuses at the end of the civil war, some of those relationships became antagonistic. Mr Samaraweera describes the former president as “vilifying” the West as a form of “hysterical nationalism to command” the vote of the ethnic Sinhalese majority, despite the fact that Western powers helped to crack down on international funding and support for the Tamil Tiger separatists towards the end of the war. Now, argues the new foreign minister, it is time for Western governments to re-engage Sri Lanka much more closely. He argues that they must regard his country as having its own “Burma moment”. Myanmar (previously Burma) had been loyal to China while it was under military rule, but in recent years it has rebalanced internationally, reached out for investment and closer ties with India and the West—and been rewarded with high-profile visits and growing economic ties. Similarly, Sri Lanka is also pivoting back to take a friendlier position towards the West (Mr Samarweera is keen to emphasise there will be no hostility towards China) so the opportunity is ripe for stronger co-operation there. Mr Samaraweera will travel both to Washington, DC and to Beijing in coming weeks.

To generating cause for substantial disquiet in both Moscow and Beijing is not bad going for a small island with a population of 20 million.

The good, the bad and the ugly of this year’s Oscar nominations

The Oscar nominations for this year are out. As usual it contains some astute choices, some really bad ones and some that are just truly bizarre. The pale, male and stale voters of the Academy retain a strong preference for a particular kind of film. The nominations have as always gone disproportionately to English language dramas at the more worthy end of the mainstream with actors and directors the academy is familiar with which go on general release in the United States. Now as plenty of excellent films match that description the list is reasonable. It is, however, generally pretty uninspiring and rather predictable.

Here’s what I’d highlight about this list:

The good

  • Birdman and the Grand Budapest Hotel as the joint leaders of the pack with 9 nominations each. These are odder films than the Academy generally goes for.
  • Marrion Coltiard has against expectations been nominated for Best Actress for her transfixing performance in Two Days, One Night.
  • Patricia Arquette has been nominated for Best Supporting Actress for her part in I’ve not , to my shame, actually seen Boyhood but the fact that the Golden Globe winner is in this category rather than Best Actress will mean Coltiard’s more likely to win that one though she’s still an outsider. If you are getting the impression I really think Marrion Coltiard deserves to win you would be right!

The bad

  • The Academy redid its rules on Best Picture nominations after what was generally accepted to be the strange decision not to nominate the Dark Knight. Rather than making this relatively dramatic change, the Academy could just have given Nolan some recognition. Yet despite Interstellar being Nolan’s best film since the Dark Knight, its (richly deserved) nominations are all in technical categories. Not quite sure what he’s going to have to do win one or indeed even get nominated.
  • No nominations for Andy Serkis or Toby Kebbel for their performances in Dawn of the Planet of the Apes. Apparently great performances don’t count if they’re delivered while wearing motion capture suits.
  • Nothing for the sound on Godzilla.
  • Nothing for Two Days, One Night apart from Coltiard’s nomination.
  • Does Meryl Streep really deserve a nomination for Into the Woods? I’ve not seen it so I don’t know but nothing I’ve seen or heard about the film suggests Streep’s performance was one of the five best performances by a woman in a supporting role. This just feels like Academy voters plumping for one of their favourites because that’s what they do.
  • No Best Animated Feature nomination for the Lego Movie!!!

The ugly



I realise that I hadn’t mentioned that Jake Gyllenhall didn’t get nominated for his spectacularly creepy performance in Nightcrawler.

Some predictions for 2015

Umunna as leader of the opposition? My most tentative prediction.

My more or less educated guesses for what will happen in the next year. I’ve put a % by each one to indicate my guess as to the probability that it will happen:

  1. The UK general election will result in a hung parliament (80%). I’m reasonably sure about that but not much else. If I had to take a stab in the dark I’d say that we’ll end up with a minority Conservative government (40%).
  2. Ed Miliband (60%) and Nick Clegg (90%) will not survive as leaders of their parties and will be replaced by Chuka Umunna (30%) and Tim Farron (50%). In the event, David Cameron ceases to be leader, I would think that Theresa May is his most likely replacement (50%).
  3. Hilary Clinton will announce she’s running for President (90%).
  4. Greece will exit the Eurozone (60%).
  5. The highest grossing film globally will be Avengers: Age of Ultron (60%). However, in the US it will be Star Wars: the Force Awakens (60%) and in the UK Spectre (50%).

UPDATE (30/01/15): When I made the predictions regarding the highest box office takes I did so under the misapprehension that the Force Awakens was being released this summer. In fact, it’s not out till the final week of December. Therefore, I now think there’s a 70% probability that the Avengers will top the US box office and am prepared to raise the probability that Spectre will top the UK box office to 70%.