Post-Crisis Economic Impasse and Political Recovery in Thailand :

The Resurgence of Economic Nationalism [1]

 

By Asst. Prof. Dr Kasian Tejapira

Faculty of Political Science

Thammasat University

 

                  

 

The Root Cause of Economic Non-Recovery

Over three years following the severest financial crisis and economic recession in post-War Thai history, with the Democrat Government of Prime Minister Chuan Leekpai and Finance Minister Tarrin Nimmanahaeminda having persistently pursued an IMF-prescribed, market-led, globalizing/neo-liberalizing economic reform program since it came to power in November 1997, Professor Dr Ammar Siamwalla, the finest and highly respected senior mainstream economist in the country and one of the two Cassandras who had presciently and vocally warned of the impending devaluation of the Baht and the resultant doom of the bubble economy prior to the crisis, has, after a long while, published another of his influential articles in the local English press.[2]  And again, he has some bad economic news to tell.

          Apparently, his latest article is a critique of a policy proposal, similarly put forward by both the Thai Rak Thai Party – the foremost contender for governmental office in the coming round of general elections on 6 January 2001 [3] – and the former figurehead of the ruling Democrat Party’s economic team,[4]  to nationalize and take out the debilitating bad debts from the banking sector by setting up a national or “public” asset management company (AMC) to buy up its remaining intractable NPLs, thereby allowing banks to capitalize faster and resume lending and thus reviving the country’s so-far crippled and dysfunctional credit system as well as stalled economic recovery .[5]  Macro-economically speaking, Ammar points out, this proposal rests on an assumed magical circle of a long chain of logic derived from the South Korean economic recovery experience i.e. [expectations of high economic growth -> higher borrowers’ income prospects -> increase in loan valuations -> less bank capitalization -> more bank lending -> higher economic growth -> higher borrowers’ income -> greater increase in loan valuations -> etc., ad infinitum, hip, hip, hooray !].  According to the national AMC advocates, this macro-economic miracle could be easily triggered off by the government’s mere purchase of bad loans from the banks at a generous price.

          However, the trouble is the whole magical scenario is based on a crucial but faulty presumption that, in Ammar’s rendering, :- “…bank lending is currently constrained only by their lack of capital, and that shortfall is due to the large amount of  NPLs for which they have to find adequate reserves.” [6]  Actually, he argues, banks are now sitting on a huge pile of money.[7]  That they are unwilling to lend has little to do with the question of insufficient money supply but everything to do with the lack of effective demand. 

Thai entrepreneurs in the real sector of the economy do have a demand for loans but their demand is not effective because most of their companies do not have an adequate equity base to meet the banks’ now much more rigorous globalized (read Westernized or Americanized) standard, which has resulted from the IMF-Tarrin’s reform of the financial sector.  Thus, whereas formerly the average debt/equity ratio of Thai companies in the non-financial sector was conventionally between 2:1 to 3:1 as against that of less than 1:1 normally obtained in the Anglo- and Latin American West,[8] now the post-crisis Thai banks are trying to adapt to the latter ratio as the new requisite, globalized/neo-liberalized standard in considering corporate loan applications.[9]  And yet, since many Thai non-financial companies (particularly the bigger ones) had borrowed extensively abroad during the good, old bubble days especially through the BIBFs (Bangkok International Banking Facilities)’ out-in financing channels set up in 1993 and consequently already had their equity wiped out by the 1997 sharp Baht devaluation,[10] the resultant huge forex losses,[11] the stock market crash,[12] and the three-year-long and still continuing deep economic recession (GDP change being –13 % in 1998),[13] how could they possibly maintain any presentable equity base to qualify for a new bank loan ?  Hence Ammar’s hard-hitting diagnosis of the Thai economic disease as follows:-

          “The mistake of those believing that an AMC would help lies in the belief that only the banks are under-capitalised.  Actually, the banks have gone some ways toward an adequate recapitalisation to meet a much more stringent standard than previously.  It is the non-financial corporate sector in Thailand as a whole that is under-capitalised.  This is not just a post-crisis phenomenon, it has always been so….

 

“It is this decapitalisation of the companies that is the root cause of the problem, far more so than the decapitalisation of the banks.

“Thailand is an over-indebted country despite a saving rate that is quite high by international standards…..We thus end up with a savings-rich, but equity-starved economy.” [14]

 

 

The Globalization or death Impasse    

From the above discussion, the following conclusions about the Thai economic malady may be inferred [15] :-

          1)  The main problem of the current Thai economy is the contradiction between the globalized banking sector and the still “Thai-Thai” non-financial corporate sector.[16]  It is precisely this contradiction or incompatibility between the two that has been paralyzing the credit system and preventing an economic recovery so far.[17]  Evidently, a partial, halfway reform of the Thai corporate sector won’t work and one needs either to complete or undo it  i.e. go further and also globalize or Westernize the non-financial corporate sector, or revoke the too stringent new capital requirements and loan regulations officially imposed on the banks and revert more or less to the former culture of lending practice.[18]

2)  If one chooses the former, it amounts to a daunting and strenuous attempt to transform the Thai capitalist economy from a hitherto localized or corrupted version of a bank-based, high-debt model a la German, Japan and East Asian system [19] to a market-based, prudential model a la Anglo- and Latin American system.[20]  The choice therefore implies two further things, namely, the transformation of family or dynastic businesses into real public companies, and a need to push the latent rich savings of the middle and wealthy classes from the relatively secure safe-deposit boxes of the banks into the risky equities market through fiscal and financial policy adjustments and the building of many new and indispensable institutional mechanisms required for the proper functioning of an equities market-based economy.

However, given the fact that the Thai stock market consists mostly of small investors rather than institutional ones, that the latter are still limited in range and legally exclude potentially important, big players such as pension funds and life insurance companies, that even if they are allowed to invest in the stock market, they will still need to build and/or develop the necessary mechanisms as well as to gain and accumulate the experience and skills in watching and checking the performance of the public companies whose shares they hold, that even when these outfits are all in place, the same information, the same rumors and the same information-processing apparatus (i.e. economic theory) that these institutional investors utilize will still lead them to display the same notorious herd instinct that accentuates the already high Thai stock market volatility, etc., given all the afore-mentioned, it is highly improbable or at least will take an awfully long time for Thailand even to approximate to the imperfect American market-based model.[21]

Hence the increasing public misgivings about and discontent with the Chuan-Tarrin Government’s globalizing/neo-liberalizing economic reform strategy, which basically consists of keeping up the contradiction between the globalized banking sector and the “Thai-Thai” non-financial corporate sector, letting the ensuing suspended economic animation progressively undermine the capital base and will to survive of both the corporate debtors and bank creditors until either the living-dead entrepreneurs or the zombie bankers whose hands are at each other’s throats become exhausted first, drop dead and then let go of their assets and equity as well as the ownership and management of their companies to foreign shareholders or buyers.  If and when these “Thai-Thai” non-financial companies follow in the footsteps of those formerly Thai-owned banks and fall into foreign hands, then corporate good governance and transparency in the globalized American style will reign over Thai business community and the Thai economy will fully recover !?! [22]

The bankers who were pressured by the Chuan-Tarrin Government into strangling their delinquent debtors along the lines of the above-described “globalization or death” strategy have been hit hard by a boomerang effect of both new and re-entry NPLs in almost equal measure.[23]  Thus, for instance, Mr Banthun Lamsam, managing director of Thai Farmers Bank and the most outspoken and articulate among top Thai bankers, has become so disillusioned with the government’s financial reform package, disheartened by the relapsing credit system, and pessimistic about the prospects of a probably necessary new round of his bank’s capitalization that he bitterly professed his inability to see other way out for his bank except “to sell itself out to foreign financial institutions…(or)...let the government take it over,” a sentiment with which Kosit Panpiemras, executive chairman of Bangkok Bank,   concurred. [24] 

Not only the reformed but some of the reformers themselves also began to voice growing unease and doubts about the effects and prospects of the reform plan.  So admitted M.R. Chatumongol Sonakul, a self-proclaimed “laissez-faire capitalist economist”, fiercely independent and sardonically blunt former permanent secretary at the Finance Ministry and current governor of the Bank of Thailand, that :- “…..The economy has yet to see light at the end of the tunnel…..I used to think that I knew…but then when I found out that the foreign debt figures which had been supposed to be at a certain level were wrong, that they were actually 20 billion US $ higher than previously estimated, which are considered extremely high, I had to come back and attend to them  again.” [25]

And yet, when pressed for a way out, Chatumongol could only come up with the same “globalization or death” line, the only question being which institution would act as the local vanguard-cum-enforcer of economic globalization, the state or the central bank.  Thus, he  suggested :-

“If one wants to see good governance nationwide, it can be done in either way i.e.

 

“1) Someone takes care of the whole matter by passing a law that serves as the framework of good governance…..The state or a strongman wades in to explain and draft a law to enforce it.  What is against it is forbidden…..

 

“2) The Bank of Thailand (BOT) compels the financial institutions which constitute the dominant sector in the business community to observe good governance.  When those non-financial business companies wish to borrow money from the financial institutions, they too would have to observe good governance otherwise the latter wouldn’t lend.” [26]

 

          However, the crux of the matter is while the economic feasibility of all the Chuan-Tarrin, Chatumongol, Ammar or other variations on the same “globalization or death” line [27] has been and is still hotly debated and open to dispute, their common domestic political feasibility has progressively dwindled since the beginning of this year and fallen sharply lately in tandem with the waning popularity of the Democrat Government, the approach of the general elections, and the chronic economic recession-induced resurgence of nationalist-populist sentiment and movements.  So much so that the surviving Thai NPL-capitalists, be it Sino-Thai or royal,  who still hold on to their assets and equity have dug themselves in, in an all-out, last-ditch resistance to being globalized unto bankruptcy.[28] 

 

The Debtors Strike Back

Thus, for example, Siam Cement, the largest and best-connected industrial conglomerate in the country with more than 100 subsidiaries and dealing in over 60,000 products, which was once a shining model of Thai corporate debt restructuring when it had worked out clear, neat plans to repay its then 5.4 billion US $ debt after Baht devaluation in mid-1997, has unexpectedly stalled its restructuring effort since the beginning of this year.  Hence, the sale of its non-core assets has ground to a halt and the reduction in its remaining 4.6 billion US $ debt has been marginal with its debt/equity ratio worsening from 243 % in the first quarter to 260 % in the second quarter of this year.  The reason for not further selling its assets at fire-sale prices, as explains the company’s president Chumpol Nalamlieng, is quite simple :- “Giving away something at a loss is really a disservice to shareholders,” the most prestigious among whom, alas, is the royal family which holds 36 % of its shares.[29]

          Much more dramatically if rather desperately,  Mr Prachai Leophairatana, the major shareholder and CEO of Thai Petrochemical Industry Plc. (TPI), the largest petrochemical conglomerate in Southeast Asia and the present biggest delinquent debtor in the country with a 3.7 billion US $ debt or approximately 10 % of the financial system’s total NPLs, allegedly mobilized a 6,000-strong rowdy mob of his lay-off-fearing, non-unionized employees to lay siege to, riotously disrupt and successfully abort two recent attempts by TPI’s 140 creditors to hold a court-prescribed meeting to vote on a rehabilitation plan.  Branded “a slave indenture” by Prachai, the plan stipulates a further reduction in TPI oil refinery’s capacity utilization from 60-70 % to 30 %, the sale of TPI’s non-core assets, and the swap of 700 million US $ unpaid interest for its equity which would make the creditor banks a major shareholder of TPI at 75 % while reducing the Leophairatana family’s holding in the company from 60 to 20 % and costing Prachai his control over TPI’s management.[30] 

In the same vein, Mr Wirun Techaphaibun, struggling NPL-entrepreneur and owner-cum-chief director of the multi-billion Baht World Trade Center (WTC) complex in downtown Bangkok, put the blame squarely on Finance Minister Tarrin’s “14 August 1998” bank rehabilitation program for the inflexible stance typically taken by banks especially government-majority-owned ones such as BMB (actually his family’s former flagship and convenient piggy bank)[31] in the debt restructuring negotiation process under the new and more stringent banking requirements and regulations.  Hence BMB’s rejection of his proposal for a 30 % debt forgiveness out of WTC’s total NPL of 1.2 billion Baht, the breakdown in the negotiations and the consequent lawsuit brought against WTC by BMB.  Wirun called on the next, hopefully non-Democrat government to change the existing financial policy and relax the banking regulations so as to reduce overall NPLs in the financial system, stimulate the flow of credit and bring about real economic recovery. 

For the said  purposes, he has turned into an activist-cum-politician, initiating and chairing a so-called Revivifying Businessmen Project, which aims at piloting both the NPL-entrepreneurs and Thailand through economic troubled water by dispensing business clinical advice.[32] Meanwhile, the Senate committee on finance and fiscal affairs chaired by Senator Suchon Charli-krau has intervened in the TPI conflict on behalf of Prachai and co by holding a hearing on the case as well as the controversial bankruptcy and 11 other related economic laws imposed by the IMF and passed under the Democrat Government.  Criticizing these laws for being unfairly negligent of small creditors’, shareholders’ and employees’ interests as against those of major creditors, for lacking in mechanism for resolving hostile cases, and for providing no protection to new money injected by creditors in the debt restructuring process, Suchon is planning other similar public events to push for their eventual review.[33] 

 And last but not least, Wirun is also running as a party-list MP candidate of the opposition New Aspiration Party (NAP) in the coming general elections and slated to become a member of its economic team responsible for international trade.[34]  Apart from Wirun, other prominent real-sector, NPL-entrepreneurs who have newly found their ways through economic nationalism to various parties’ lists of MP candidates include, for example, Sawat Horrungruang (Chat Thai Party), the steel magnate and infamous author of the Thai NPL debtors’ “Three Don’ts” battle-cry i.e. don’t pay interest, don’t negotiate, don’t run away, and Chirayuth Wasurat (NAP), businessman and former leading senator who has been a staunch critic of the Democrat Government and IMF from the beginning.  Among the political parties, the Chat Thai Party, the Seritham Party, the Chat Phattana Party, NAP ,TRT, and the Thai Motherland Party are, to varying degrees and in ascending order of scope and seriousness, publicly committed to the revision of some or other elements of the IMF-Democrat Government’s economic reform package.[35]  On top of the fact that these anti-Democrat & IMF NPL-entrepreneurs are occupying strategic positions in many parties, current public sentiment is also fed up with the Democrat leadership (especially Chuan and Tarrin)’s overconfidence and pigheadedness while TRT’s openhanded, populist policies are also a major attraction for other parties’ provincial MPs.  And last but not least, in a recent highly unusual and politically-charged move, two of the remaining top Sino-Thai tycoons i.e. chairman of Bangkok Bank Chatri Sophonpanich and head of the Charoen Pokphand Group Dhanin Chiraravanont, have publicly endorsed TRT head Thaksin Shinawatra’s bid for premiership, thus throwing the considerable weight of the Bangkok-based business and financial community behind him.[36]  Therefore, chances are TRT is “three times” as likely to form and lead the next coalition government as the Democrat Party, in the stated opinion of an influential and experienced political activist-cum-public intellectual.[37] 

All in all, as a foreign correspondent observes :- “Most Thai companies have not shown the will to undertake the difficult managerial and operational overhauls that most analysts claim are necessary to return to profitability and stay competitive globally.” [38]  The key reason, as pointed out by Thanong Khanthong, a well-versed and well-informed Thai economic reporter-cum-columnist, is that Thai corporation owners refuse to “reduce their debt load by letting go of part of their assets and equity in exchange for fresh capital and better management.”  This little-discussed refusal, Thanong’s opinion, “lies at the heart of the mother of all problems.” [39]  Apparently, the financially-cornered debtors have found another way out.  They are preparing to strike back politically.

 

The Long March to Political Recovery

          Three years ago, in the aftermath of the financial crisis, Thai politics was mired in a triple impasse as follows :-

          1)  Thai electocratic political system by itself was incapable of coping with the financial crisis and salvaging Thai capitalist economy in the age of globalization but needed the help of IMF’s credibility and directives in order to do so.[40]

          At the same time, the economically dominant Thai capitalist class on its own was also incapable of mounting a protest movement strong and effective enough to push for political reform or a change of national leadership but needed the extraordinarily volatile and critical conditions of the economic crisis plus the informal support of such extra-parliamentary forces as the military, the IMF, people’s organizations as well as the monarchy to achieve both.

          2)  Both the political system and the political leadership had a legitimacy deficit whereas the revival of Thai capitalist economy under the IMF program required a high degree of political legitimacy since its loan conditionality caused devastating socio-economic dislocation.

          Therefore, the IMF loan rescue-cum-economic restructuring program needed a technocratic consensus-based mass political passivity as a sine qua non for its success i.e. people had to tamely believe that all economic problems were technical by nature, that these were best solely entrusted to technocrats to decide on their behalf, that their interests and well-being would be best served and taken care of by letting the technocrats lead them by the nose so as to follow in the IMF’s footsteps.

          3)  Thailand saw no alternative to the IMF line in solving its economic problems.  Hence the utter meaninglessness and inconsequentiality of political reform, the new constitution or the new general elections in terms of economic policy alternatives for they amounted to a mere selection of a group of people among many others to carry out a pre-determined plan devised by the IMF.  That wasn’t much different from having a bunch of kids compete with one another to do an exercise consisting of questions posed by Teacher IMF.  Some kids might come up with better answers than others but basically that was all they could do.  Nothing went far beyond the framework already laid down.

          After languishing in the above-described impasse for three years, and despite the continuing economic non-recovery, Thai politics has now staged a nascent recovery i.e. mass protest movements have re-emerged in force all over the country, the Washington consensus-derived Thai technocratic consensus is being seriously challenged and rejected, and alternative strategic visions other than the globalist/neo-liberal one are being actively and collectively constructed, publicly presented and widely publicized and debated.

          People who have been involved in this political recovery can be roughly divided into three groups as follows :-

          1) The so-called “Octobrists” (or “Khon deuan tula” in Thai) :- These are mostly well-known and established writers, thinkers, academics, public intellectuals and activists who used to take part in the historic radical student and popular movements of the 1970s and later joined the communist-led armed struggle in the countryside or carried on their cultural political activities non-violently in the city.

          2)  The small but influential group of so-called “Senior Citizens” and “socially-outstanding good people” :- Members of this group are respectable and honest retired or active senior government officials.  Ideologically a hybrid of royalism and communitarianism, they work mostly through development and grassroots NGOs to build up local community bases for socio-economic and political reform against the centralized state bureaucracy, corrupt politicians, capitalist economic globalization and consumerist culture.

          3)  Thai entrepreneurs in various trades and at all levels whose businesses are facing stiff competition from foreign business interests, or whose assents are being sold off and equity taken over by foreign creditors.  Also included in this group are some outspoken and prominent independent nationalist academics, especially social scientists and economists.

          The above-mentioned groups and their individual members have over the past three years mingled together and formed a variety of ad hoc loose nationalist groupings e.g. the National Salvation Community (“Prachakhom kob ban koo meuang,” an early grouping of activists, academics and intellectuals who were concerned with the economic crisis), the Bangchak-lovers Club (“Chomrom khon rak bangchak,” which is opposed to the sale of the state-owned Bangchak oil refinery to foreigners), the United Thai for National Liberation Club  (“Chomrom ruam jai thai koo chat,” whose main aim is to prevent the sale of the nationalized Bangkok Metropolitan Bank and Siam City Bank to foreign banking interests), the Free Thai Movement (“Khabuankan seri thai,” a group of prominent academics and intellectuals whose namesake was the underground resistance movement against Japanese occupation during the Second World War), the Withithas Project (a publication project which has published a long series of radical leftist anti-globalization semi-academic pocketbooks since 1997), the Thai Graduates’ Group (“Klum bandit thai,” a staunchly anti-imperialist group of engineering lecturers at Chulalongkorn University whose leader, Dr Sawai Danchaiwijit, was an Octobrist and ex-guerrilla), the Patriotic People Club (“Chomrom prachachon phoo rak chat,”  consisting of many thousands of followers of a hugely popular and highly revered senior monk in northeastern Thailand, Luang Ta Maha Bua, who is resolutely opposed to the IMF-prescribed consolidation of accounts from the BOT’s banking and issuing departments for fear that his followers’ multi-million Baht foreign currency and gold donations to the national reserves might be squandered by the government to compensate for the losses incurred in bailing out the bankrupt financial institutions), the Democracy for the People Group (“Klum prachathipatai pheua prachachon,” a group of ex-guerrillas and radical student activists under the leadership of the charismatic ex-student leader and guerrilla fighter Dr Seksan Prasertkul of Thammasat University whose aim is to function as a nationwide coordinating, political umbrella organization for local people’s groups all over the country), etc.  Besides, there are pre-existing people’s organizations, NGOs and academic groups which have also adopted a populist-nationalist stance against the IMF-Democrat Government’s economic policies such as the militant long-standing and well-organized Assembly of the Poor (AOP), the Friends of the People Group (ex-student activists and intellectuals who serve as the general staff and secretariat of AOP), the Political Economy Center of Chulalongkorn University (established group of progressive, left-leaning economists).

          Their intellectual activities and publicity campaign have been carried out through a continuing flow of books, periodicals and newspapers with increasingly militant contents and rhetoric.  The more important among them are :- Assembly of the Poor’s Black-Covered Book: People’s Handbook under IMF (1998), the Withithas Project’s pocketbook series edited by Thianchai Wongchaisuwan (aka “Yuk Sri-ariya”, a Marxist intellectual) and Phitthaya Wongkul (a communitarian devotee), the re-published and renewed populist-nationalist Journal of Political Economy of Chulalongkorn University, the radical Buddhist Pacharayasarn Magazine of the Sulak Sivaraksa group, the Prachathas Newsletter of a coalition of NGOs, the Bandit Thai Newsletter of the Thai Graduates’ Group, the Manager Daily, the weekend Khleun Khwamkhid or Waves of Thought radio program on FM 101 MHz by Chatcharin Chaiyawat, etc.

          They have separately and/or collectively engaged in many forms of public activism from academic seminars, panel discussions, collections for national economic crisis relief to demonstrations, signature campaigns, etc.  The more prominent among them were the AOP’s demonstration against IMF loan conditionality, the campaign against the sale of state-owned Bangchak oil refinery to foreign business interests, the anti-globalization/neo-liberalism demonstrations of NGOs and people’s organizations during the UNCTAD 10^th meeting in Bangkok and the annual ADB meeting in Chiang Mai, the campaign against the IMF-imposed 11 financial bills that gave greater advantage to foreign creditors, the publicized opposition to the sale of nationalized banks with disadvantageous loss-sharing and yield-maintenance guarantees to foreign financial interests, Luang Ta Maha Bua’s popular Pha pa chuai chat (donation to help the nation) project which turned unexpectedly into a massive signature campaign to oppose a major financial reform policy of the Democrat Government as well as to impeach Finance Minister Tarrin, etc.[41]

          Two factors have played a key igniting, inspiring and boosting role in the foregoing process of political recovery through economic nationalism, namely, King Bhumibol’s speech on “Setthakij pho-phiang” or “self-sufficient economy” given on 4 December 1997, which has been interpreted in such a way as to open public space for discourse on systemic alternatives to “trade economy” or capitalist globalization,[42] and the world-famous resurgent anti-globalization mass protest at Seattle in late 1999 that managed to shut down the millennium round of WTO meeting.[43]  Together, they constituted both an inspiration and a living example that pointed to new, emerging possibilities in resisting capitalist globalization in Thailand, the East Asian region, and throughout the world.

          From the said varied and diverse sources, an economic populist-nationalist trend that is both anti-globalization and anti-neo-liberalism has emerged from the political margins to reach the political center, from the masses to meet up with the elite, from the academia, the print and electronic media and Buddhist laymen’s groups to coalesce into mass political movements, changing in the process from abstract theoretical discourse to concrete strategic and policy proposals and demands, an elaborate and path-breaking series of which has in the past couple of months been successively presented to the public by such high-profile public figures as Dr Virabhongse Ramangkura,[44] Assoc. Prof. Rangsun Thanapornpun of the Faculty of Economics, Thammasat University,[45] Dr. Seksan Prasertkul,[46] Dr Phijit Rattakul, head of Thai Motherland Party,[47] Princess Phatcharakittiyapha, the eldest daughter of the Crown Prince, who is currently enrolled as a senior in the Faculty of Law, Thammasat University,[48] a group of six prominent public intellectuals, a senator and a businessman,[49] and a self-proclaimed “neo-nationalist” group of Chulalongkorn academics and assorted businessmen and politicians.[50]  These burgeoning political forces are surrounding and increasing their pressure on the electocratic parliamentary regime.

 

Conclusion: Whose Nation Is It ? and Whither the Nation ?

          The Thai capitalist class has basically already been bankrupt since the July 1997 Baht devaluation.  Their wealth which had been accumulated for many decades was all lost simply because they had borrowed many times more than their companies’ equity value.  Thus, their national capitalist project, which attempted to follow, overtake and then ride on the crest of the economic globalization wave, was unexpectedly aborted and utterly collapsed.  They are not unlike some fisher folk on the Moon River who, upon the completion of the Pak Moon dam at the mouth of the river, had no choice but to change their job from fishing to garbage dump picking in Bangkok i.e. they have to switch from forming, accumulating and expanding their capital base in a bank-based, high debt economy to doing the same things but in a completely new and different way in a market-based, prudential one.  They have to relearn almost everything anew and that is extremely difficult if not well-nigh impossible.

          A capitalist economic crisis of overproduction and overcapacity can be solved only by disposing of excess capacity or productive forces.  The more quickly the destruction is done, the more rapid the recovery will be.  This is precisely a necessary act of creative destruction capitalism occasionally demands of its practitioners.  And part of the productive forces that needs to be destroyed is the Thai capitalist class themselves in their role as losing owners and entrepreneurs of inefficient, uncompetitive and unprofitable capitalist private enterprises.  The delay in economic recovery is actually caused by the slowness in their destruction.  They die too slowly and are still stubbornly struggling and resisting to survive.  Until they all drop dead, not as a rich individual consumer with still ample personal savings but as a collectively impoverished and failed productive class, the Thai economic paralysis will go on and on and the new dawn or the beginning of a new cycle of productive activity won’t arrive.

          In that sense, the end of globalization is a universal economic utopia devoid of any and all particular national characteristics and hence national capitalists.  Global capital is thus taking over the material infrastructure of Thai capitalism with all its residual unfair, monopolistic and exploitative character, as well as exerting greater and greater influence over the pre-existing auto-colonial centralized state structure that has since time immemorial been the main agent in transferring natural resources from the have-nots to the haves and commodifying everything in the process.

          The Thai capitalist class is, alas, trying to defend themselves by invoking the Nation and putting the lives and well-being of poor common people at risk as its fences to ward off and dispel the unrelenting universal logic of capital…..

Historically speaking, at its origin, the particular configuration of the Thai nation was officially imagined by the Thai absolutist and later military-bureaucratic state as an uncommunity, consisting of people of unequal status and incompatible plural ethnicities with the Chinese entrepreneurs, coolies and triads being the Other.[51]  Other groups and classes of Thai people besides the royalty, the military and the state bureaucracy have found precious little of their own history, culture and community in this imagined uncommunity.  Hence its rather hollowness and blurriness, irrelevance and worthlessness in the people’s eyes as well as its repeated opportunistic abuses by the old royal or military-bureaucratic and new crony capitalist elites for their own particular group interests.[52]  Mr Prachai, Wirun, Sawat and their ilk are simply the latest comers in the long line of born-again nationalists who, out of a usual background of total disregard for the plight of their poor compatriots, suddenly feel and find an insatiable urge to make use of the imagined (un)community to indulge their urgent, unrequited desire for new re-capitalization.

It is thus incumbent upon the new advocates of economic nationalism to think hard whose nation it is ?  And whither the nation ?  Thus, for example, to Finance Minister Tarrin’s quip whether his critics wished to return to the past bubble years where growth came from asset price inflation rather than genuine productivity gains,[53]  an answer is provided by Seksan Prasertkul that he had no wish whatsoever to bring back pre-crisis social conditions which had been far from ideal and in which “those who worked hard earned little income while those who earned a lot hardly worked…..Truthful people were trampled on while deceitful people were rewarded,” and that his attempt at salvaging the Thai nation was “by no means to pull up by a pulley the fallen heaven of the minority from the bottom of the ocean and leave the majority of people to go on languishing in poverty.”  [54]  And while the neo-nationalist Dr Narong insisted in an interview that Thai monopolistic or oligopolistic capitalists were indeed better than their Western counterparts,[55]  Nidhi thought the exact opposite.  Having redefined the Thai nation as consisting of “the people, freedom and justice”, he concluded in a recent article that :-

“The rejection of globalized capital doesn’t mean the acceptance of crony capital.  Be it which one of the two, both oppress and exploit the majority of people, deprive them of their freedom, and buy up justice for themselves alone alike.  The difference between domestic capitalists and foreign ones in reference to the people’s welfare, freedom and justice amounts to naught i.e. there is no difference.”[56]