A Healthy Serving of Skepticism in the Obesity Debate

As the rising rate of obesity has cost the nation billions in added health care costs, much needed discussions about healthy eating have become more prevalent. The dominant narrative is that a host of external causes, like "food deserts," "aggressive advertising" and the "high cost of healthy food" are responsible for the widespread and detrimental consumption of junk food. But, unfortunately few Americans, even in the educated classes have approached the official narrative with even a modicum of skepticism and sough to verify its claims. Research have emerged that have cast doubt on many of the claims put forth by government and media figures. For example, in most cases, proximity to a grocery store did not increase consumption of healthy foods and in most consumers can purchase healthy fruits and vegetables at a lower cost than junk food. Anecdotal evidence seems to support the researcher's conclusions, because on every occasion that I visit my neighborhood grocery store, I witness consumers choosing unhealthy, processed foods, over healthy, affordable staples (like lentils, broccoli and tilapia). This is not simply an empty academic debate, because the flawed narrative will lead to flawed policies that will do little to stem the rising tide of obesity.

5 Myths About Healthy Eating

A helping of skepticism about the causes of Americans’ poor eating habits—and the effectiveness of political fixes

Katherine Mangu-Ward | October 21, 2011

New Jersey Gov. Chris Christie’s decision to stay out of the Republican presidential race means that the American people will be spared months of discussion about his ample waistline and the bad example it sets. Nonetheless, with first lady Michelle Obama urging everyone to get moving, obesity remains a political hot potato, or maybe a tater tot. Below, a helping of skepticism about the causes of Americans’ poor eating habits—and the effectiveness of political fixes.


1.  People in poor neighborhoods lack access to fresh fruits and vegetables.

 Walk into nearly any supermarket in the United States, and you are immediately confronted with abundance—bok choy, mangos, melons and avocados from across the globe—where a couple of varieties of apples and carrots once struggled to fill shelf space.

But not everyone has easy access to this fruity phantasmagoria. If you’re picking up ingredients for dinner at a gas station or a convenience store, you probably live in what eggheads have taken to calling a “food desert”—an ill-defined concept with powerful policy implications. A commonly cited 2009 statistic from the U.S. Department of Agriculture has 23.5 million Americans living in poor urban and rural areas with limited access to fresh food.

Making those food deserts bloom is a centerpiece of Michelle Obama’s anti-obesity agenda. This January found the first lady smiling for the cameras with Wal-Mart executives in Southeast Washington and declaring herself “more hopeful than ever” as she tours the nation’s produce sections.

But the prevalence of food deserts is almost certainly overstated. Not having a supermarket in your Zip code isn’t the last word in access to healthy food. According to the USDA, 93 percent of “desert” dwellers have access to a car. And farmers markets, often overlooked in surveys of rich and poor neighborhoods alike, have tripled since 1994.

Still, it does seem reasonable that making it easier to buy fresh food would improve what people eat. However, a study published this year in the Archives of Internal Medicine, the first to measure the impact of access to fresh food on diet, followed 5,000 people for over 15 years and found something surprising: Proximity to a grocery store or supermarket doesn’t increase consumption of healthy food. That suggests that a lack of convenient leafy greens isn’t the problem. Dinner menus are the product of subtle and pervasive food cultures, which can’t be tweaked from the East Wing.

The primary beneficiaries of tax incentives and other nudges aimed at abolishing food deserts are big grocery chains, not poor shoppers.

2. Advertising forces people to make unhealthy choices.

Television-bound children, their eyes awhirl with images of Tony the Tiger and his high-fructose friends, haunt the debate about junk-food advertising. And any parent who has ever experienced a 2-year-old’s grocery store meltdown would certainly like to have someone to blame. But the Institute of Medicine, an arm of the National Academy of Sciences, has concluded that “current evidence is not sufficient to arrive at any finding about a causal relationship from television advertising to adiposity [excess weight] among children and youth.” Similar findings hold true for adults.

We don’t need advertisers to tell us that candy is delicious. Humans were big fans of fat and sugar long before the idiot box was invented. We’re programmed to go for the good (bad) stuff. Sure, Kellogg’s and General Mills have big advertising budgets, but they’re nowhere near as powerful as Darwin. Cracking down on advertisers gives politicians a scapegoat, but it doesn’t make kids, or their parents, healthier.

3.  Eating healthy is too expensive.

 A dinner of hot dogs and Devil Dogs is undeniably cheap. But a bowl of beans and rice with a banana on the side is cheaper. A survey by the USDA found that, by weight, bottled watek is cheaper than high-fat, and whole fruit is cheaper than processed sweet snacks. Preparing a big pot of lentils for the week may be not be glamorous, but it’s much cheaper and not much more time-consuming than cooking up frozen pizza or mac and cheese.

The New York Times’ Mark Bittman—no fan of Frito-Lay—writes that the idea that junk food is cheaper than real food is “just plain wrong” and that blaming unhealthy habits on cost is incorrect. People who eat lots of unhealthy food aren’t doing so because they lack cheap, healthy options. Instead, it’s because they like junk food. Making junk food comparatively more pricey by tacking on taxes—a proposal that has been revived many times by Yale’s Kelly Brownell (and recently made into law in Denmark)—mostly means that people will pay more taxes, not eat more kale.

4.  People need more information about what they eat.

It’s hard to argue against rules that give consumers more information. Perhaps for that reason, proposals to require restaurants to jam calorie, fat and other nutrition statistics onto already crowded signs and menus pop up over and over—most recently as part of the health-care reform law—despite the fact that virtually all major fast-food chains already provide such information on handouts and online.

Knowing that a chocolate shake at Shake Shack has 740 calories doesn’t stop me—or the first lady— from ordering one occasionally. We’re not alone: Studies consistently find that menu labeling doesn’t result in healthier choices. A recent study from Ghent University in Belgium found that labels made no difference in the consumption patterns of students there, backing up a 2009 New York University study that found no improvement in poor New Yorkers’ eating habits after the introduction of mandatory menu labeling in the Big Apple.

5.  There are too many fast-food restaurants in low-income neighborhoods.

In many urban neighborhoods, it’s easier to get permission to open a sex shop than a Taco Bell, thanks to aggressive policies by local zoning boards. But zoning out fast-food restaurants in cities is a lost cause—they are probably already too thick on the ground for new restrictions to alter the culinary mix. The same study that found no effect on diet from increased access to fruits and vegetables also found that proximity to fast-food restaurants had only a small effect, and it was limited to young, low-income men.

In a commentary accompanying the study, Jonathan E. Fielding and Paul A. Simon of the Los Angeles County Department of Public Health wrote that “policy efforts to reduce access to [junk food], though politically challenging, will likely have a greater impact on reducing the obesity epidemic than efforts focused solely on increasing access to fresh produce and other healthy options.” “Politically challenging” is code for “virtually impossible.”

And for good reason. Eliminating access to fast food and other junk food means taking away choices, something Americans don’t tend to like, even (or perhaps especially) when it’s for their own good.

Katherine Mangu-Ward is the managing editor of Reason. This article originally appeared in The Washington Post on October 14, 2011

The Middle Path To Understanding (And Addressing) The Racial Achievement Gap

The existence of a glaring achievement gap among different racial and ethnic groups within the United States is widely known. When we analyze rates of high school graduation, college attendance, unemployment, income, incarceration, obesity and out of wedlock births, we find that Asian-Americans enjoy the most positive outcomes, followed by European-Americans and then Hispanic-Americans with African- Americans demonstrating the most troublesome statistics. Where the greatest disagreement lies in on the explanation for this persistent phenomena. Progressive explanations typically center on the following factors of continued Institutional Racism and White Privilege. Whereas, conservative explanations usually discount racism, instead focusing on: cultural pathologies that encourage poor social and economic strategies.

The first glaring problem with the progressive explanation is that not only have Asian-Americans outperformed European-Americans in every social and economic measure, but so have African Immigrants. For example, 43.8% of African Immigrants are college graduates, which greatly exceeds the national average of 23.1%. If the "white power structure" and "institutional racism" are the deciding factors in educational and economic achievement, how is it possible that Indian, Japanese and Chinese immigrants have risen so quickly and are now doing better than whites? And interestingly this same phenomena is mirrored on an international level, with East Asian nations experiencing outstripping most European Nations in educational and even economic output. This clearly demonstrates the economic and social welfare are not static phenomena; throughout history, the fortunes of individuals, groups, nations and even regions have risen and fallen.

This phenomena become much clearer when we "look at the trees" rather than at the "forest, i.e. focus on specific, individual values, behaviors and choices that increase or decrease an individual's chance for improving their economic and social trajectory. The reason I chose to focus on trajectory, is because comparing the absolute outcome of (let's say) the child of a working class immigrant to a well established, middle class family would neither be fair nor allow us to fully determine the effect of culture and choice. But, comparing the relative improvement or decline of each individual or group would allow us to do so. And exploring the multi-generation trajectory of families and groups paints an even clearer pictures of the dynamics that government social and economic assent and decline. 

Or, to be even more specific, we could ask ourselves what advise would we give to a friend or family member about how to improve their chances for success? Here are the most obvious: dedicate more time to studying, at all costs do not drop out of high school, do not have a child before you graduate, do not have a child until you are married and financially stable, avoid engaging in behaviors that run the risk of arrest,  if possible choose a highly marketable field of study, such as math, science and engineering, live beneath your means, establish a good credit history, save and invest in the future. While making the right choices are not absolute determinants of one's trajectory, no one can deny that there exists a very strong correlation between choices, behaviors and outcomes. When we "compare apples to apples," or the more upwardly mobile to  the less upwardly mobile components of the African-American community, we will certainly encounter markedly different approaches to family, education, employment, saving and investment strategies. And unless we are hopelessly intellectually dishonest, we will see that the same is true for more (and less) upwardly mobile ethnic groups. To put it simply, Indians and African Immigrants have risen so quickly, because a higher percentage of their respective groups adopted values, choices and strategies that are conducive to success and African-Americans and (to a lesser extent) Hispanic and European-Americans have not. 

There is a balanced middle path that does not look at issues of social pathology as an either / or phenomena; they acknowledge the continued effects of racism, but believe that they are greatly amplified by the prevailing culture, values and behaviors of individuals and communities alike. In this day and age, such choices have a far greater bearing on the social and economic welfare of individuals and communities than racism and white privilege. For example, many African-American communities are provided by substandard schools, whose negative effects are amplified by the insufficient commitment to learning and discipline present in many families. But, those who take the middle way differ from most conservatives by their acknowledgement that culture and behavior do not occur in a vacuum; they are products of one's history and experience. In other words, the most pernicious aspect of America's long history of racist oppression is that it degraded the social and cultural capital of its victims, leaving them in a state in which they cannot fully capitalize on the rapidly expanding opportunities of a free society.

Decimate a  people's common culture, outlaw education for 5 generations and provide shamefully substandard schooling for 3 more and it will not come as a surprise that a substantial portion of the next generations will be left without a tradition of learning. Subject several generations to slavery and bar their descendants from all but the most menial professions and do not be surprised if the next generations do not see the connection of work and discipline to upward mobility. And then finally when you acknowledge the magnitude of the crime you committed against a whole people, you seek to make amends by the massive expansion of the welfare state that renders a portion of the beleaguered community dependent on the state, with their traditional family structure eviscerated. Part of this tragic drama are the "experts" and "activists" who treat the battered community like children and passive agents who are incapable of shaping their environment and their destinies, like other communities have done so before them. Their refusal to assign any responsibility to diverse communities for the problems that they face may stem from a well meaning prohibition against "blaming the victim," but it has eroded their capacity to acknowledge and address the pathological behaviors and cultural patterns that play a major role in shaping disparate outcomes.

The view of the Middle Way begs the questions: What can be done? If personal choice and culture are driving forces in the trajectory of individuals, communities and cultures, can the state do anything to induce real, positive change? Relatively to progressives, who have deep faith in the power of the state to shape equal outcomes, classical liberals (libertarians) believe that at best the state can expand equal opportunity. The problem is not that universities are discriminating against diverse groups, quite to the contrary, most are religiously pursuing "diversity" and "equal outcomes." Rather, the dearth of qualified high school graduates means that far too diverse students are able to capitalize on these unprecedented opportunities. So, improving the dismal schools that diverse communities face is of paramount importance. Without real improvement in educational outcomes, progress will remain elusive and economic inequality will continue to worsen.

How schools can be improved is truly a vexing question, because more than a half century of efforts by the educational establishment to bridge achievement gaps have bore little fruit. Rather than repeat the tried and failed formula of: increased funding, increased federalization and the pursuit of unproven pedagogic fads, a new paradigm must approached: school choice and competition. Unlike most of my conservative brethren, I make no illusions that the said factors can improve failing schools, but at the very least they can offer expanded opportunity for the students who are willing and able to pursue them. And on an even broader level, the education establishment must shift its focus from the study of failure, towards understanding and promoting the norms, values, behaviors and strategies that upwardly groups (Asian-Americans) and nations have pursued. As painful as it may be to admit, not only do schools shape their students, but students and their families have a central role in determining the quality of the schools. So, without a shift in the values, norms and behaviors that predominate in a community, even the most well run schools will still produce dismal results.

This brings us to the topic of welfare. As a classical liberal (libertarian) I would like to see welfare in its present form significantly reduced. However, until we arrive at that improbable point, the best we can hope for is to reform welfare programs so that they will subsidize positive, rather than pathological choices. Increasing subsidies for welfare recipients who choose to not have more children (than they can afford and educate) may constitute excessive social engineering for most conservatives, but would ultimately offer a net decrease in expenditures and provide incentives for positive behavioral changes. In addition, the incentive structure that governs social welfare agencies needs to be transformed; social workers and bureaucrats who are able to help their clients transition away from dependency and pathology should be offered bonuses. Mandating full time employment, even "menial jobs" that "Americans won't do" for all adults in a household that receive welfare is essential for breaking the cycle of dependency and re-establishing a culture of work.

Ultimately what characterizes the middle way is intellectual honesty, a belief that we must allow facts and reason to carry us to logical conclusions, now matter how uncomfortable they make us, no matter how offensive others find them. For using sophistry to support comfortable narratives will spare feelings, but will lead us to continue pursuing the ineffective paths and policies of the last half century. The first step towards real compassion is adopting the intellectually honesty acknowledgement that past racism casts its heavy shadow on the present via the persistence of widespread cultural and behavioral pathology. Failure to do so will doom future generations to even greater economic and social inequality; a more racist outcome I cannot imagine.

No, You Are The Special Interest!

Who of good conscience doesn't find the $4 Billion tax break for the oil industry, $3 Billion tax break for corporate jets and $126 Million tax break for the horse racing industry obscene examples of corporate welfare? However, since they only account for 8% of the tax breaks, from the point of deficit reduction, they are largely meaningless. A great article in The Washington Post demonstrated that by far the most costly  tax credits are directed towards households, which in 2011 had a negative fiscal impact of over $1 Trillion. For example, the cost of the exclusion of employer contributions for medical insurance premiums grew to $173.7 Billion, mortgage interest write-offs amounted to $88.8 billion and the 401K provision was worth $62.9 Billion. The author correctly points out what many (so called) fiscal conservatives like Grover Norquist fail to see: indirect government spending via tax credits holds the same negative fiscal impact as direct expenditures. The only real difference is that politically "stealth spending" is always easier, because it allows politicians to take credit for expanding government benefits, while also reducing taxes; a temptation that few Democrats or Republicans can resist. But, if we are too tackle our spiraling national debt and avoid the development of hazardous market distortions (housing bubble, college debt bubble, etc.) we must begin to wind down the regiment of tax credits to corporations and households alike. We can no longer afford a system in one man or group is expected to pay for another's special interest.

Ever-increasing tax breaks for U.S. families eclipse benefits for special interests

List of 10 most costly tax breaks in 2011. 




By Lori Montgomery, Published: September 17

As President Obama and congressional Republicans argue over how to rewrite the U.S. tax code, the debate has revolved around “loopholes” for corporate jets and ending “carve-outs” for well-heeled special interests. But if the goal is debt reduction, that’s not where the money is. Broad tax breaks granted to millions of families at all income levels dwarf the corporate giveaways. Over the past two years, largely because of these popular benefits in the federal income tax code, the government has reached a rare milestone in tax collection — it has given away nearly as much as it takes in.

The number of tax breaks has nearly doubled since the last major tax overhaul 25 years ago, with lawmakers adding new benefits for children, college tuition, retirement savings and investment. At the same time, some long-standing breaks have exploded in value, such as the deduction for mortgage interest and the tax-free treatment of health-insurance premiums paid by employers.

All told, federal taxpayers last year received $1.08 trillion in credits, deductions and other perks while paying $1.09 trillion in income taxes, according to government estimates.

Only about 8 percent of those benefits went to corporations. (The write-off for corporate jets equals about .03 percent of the total.) The bulk went to private households, primarily upper-middle-class families that Obama has vowed to protect from new taxes.

“The big money is in the middle-class subsidies,” said Syracuse University economist Leonard Burman, former director of the nonpartisan Tax Policy Center. “You’re not going to balance the budget by eliminating ethanol credits. You have to go after things that really matter to a lot of people.”

These tax breaks weave an invisible web of government benefits that now costs nearly as much as the Pentagon and all other federal agencies combined. But “tax expenditures,” as they are known in Washington, get no routine oversight. Congress and the Treasury Department both track them but use different rules to count them and estimate their value. The congressional Joint Committee on Taxationlists more than 300 breaks, while Treasury tallies 172.

No one regularly assesses whether tax expenditures accomplish the goals they were created to serve. Yet, with the rise of an ideology within the Republican Party that shuns big government and vilifies taxes, they have become virtually untouchable.

For those reasons, the tax code is a popular venue for both parties to pursue costly policy goals.

Edward Kleinbard, a University of Southern California law professor who served until recently as chief of staff to the Joint Committee on Taxation, says tax breaks are now the dominant instrument for creating new spending programs. Policymakers can give taxpayers a government benefit and get credit for lowering their tax bills — a combination lawmakers find “irresistible,” Kleinbard said, because they can portray themselves as tax cutters rather than big spenders.

Every president since Ronald Reagan has learned that lesson. In 1997, after a Republican Congress refused to increase spending for federal student loans, President Bill Clinton turned to the tax code to create a slew of higher-education credits. Initially worth around $10 billion a year to the nation’s college students, those benefits have been expanded to more than $20 billion annually.

Similarly, when President George W. Bush wanted to help victims of the Sept. 11, 2001, attacks, he turned to the tax code. He backed the Victims of Terrorism Tax Relief Act, which wiped out two years of tax liability for survivors and created a continuing exemption for annuities paid to families of public-safety officers killed in the line of duty. Estimated 10-year price tag: $360 million.

In 2009, when Obama wanted to boost the flagging economy, he offered a massive new tax break as the centerpiece of his stimulus package. The Making Work Pay credit put about $60 billion a year in people’s pockets in 2009 and 2010, including $18 billion in “refundable” payments to low-income families whose tax bills were so small that the government had to write them checks to make sure they received the full value.

This week, Obama is expected to offer an outline for revising the tax code to weed out special tax breaks. At the same time, he is pressing Congress to create several more.His $447 billion jobs package includes a $4,000 credit for hiring people who have been out of work more than six months and a $5,000 credit for hiring returning war veterans.

Administration officials say targeted tax cuts are an easy way to quickly put money in people’s pockets. But they also acknowledged the political reality that lawmakers are more inclined to support a plan that cuts taxes than one that increases spending.

Once a tax break is ensconced in the code, it is hard to dislodge. Beneficiaries become fierce defenders, as do anti-tax conservatives, who view the end of a tax break as an impermissible hike in overall tax collections. About 95 percent of Republicans in Congress, and a few Democrats, have signed a pledge circulated by GOP strategist Grover Norquist vowing to “oppose any net reduction or elimination of deductions and credits, unless matched dollar for dollar by further reducing tax rates.”

The pledge, which Norquist has been circulating for 25 years, promotes “a nonsensical debate that says we’re not going to talk about spending in the tax code like we talk about other spending said Eugene Steuerle, an architect of the 1986 tax overhaul while working in the Reagan Treasury Department and now a senior fellow at the Urban Institute. “Spending in the tax code is granted a superior status, and if you get rid of it, it’s called a tax increase.”

Simply limiting the cost of a tax break can be politically perilous. Norquist’s group, Americans for Tax Reform, recently issued what it called a “comprehensive list of Obama tax hikes.” Among the items: The reversal of a 2003 Internal Revenue Serviceruling that allowed people to use pretax health spending accounts to pay for over-the-counter drugs. The group has dubbed the change the “medicine cabinet tax.”

Even temporary tax breaks have proved remarkably resilient. Congress routinely passes a “tax extender” bill that renews a host of expiring provisions worth about $30 billion a year. One of the most expensive: a break for residents of states that levy no income tax, including Texas and Florida. Congress has agreed to let them deduct sales taxes instead, at an annual cost to the Treasury of about $1.8 billion.

Congress generally renews the breaks for a year or two, preserving the illusion that they are temporary. But of dozens of breaks created since 1986, lawmakers have permitted just 18 major ones to expire, according to a recent Joint Committee report. Half were stimulus measures enacted by Bush and Obama during the recent recession.

Making Work Pay is among the fallen. But before it expired in December, Congress replaced it with a more generous provision that reduced payroll taxes by two percentage points this year. The payroll tax holiday will put an estimated $80 billion in workers’ pockets — a perk that comes on top of the breaks that reduce their income tax bills.

Combined with traditional rate cuts in 2001, proliferating tax breaks have left people at all income levels paying a shrinking share of their earnings in income taxes, the primary federal revenue source. Nearly half of all households no longer pay any income tax. Meanwhile, a middle-income family of four paid just 4.7 percent of its income, on average, to the IRS last year, according to the Center on Budget and Policy Priorities — the third-lowest percentage in 50 years.

If policymakers hope to raise enough cash from tax loopholes to help tame the nation’s debt, tax experts say individual taxpayers will have to pay more.

Even the Bush tax cuts of 2001 and 2003, while infamous for providing disproportionate benefits to the rich, showered far more money in absolute terms on the middle class. The legislation doubled Clinton’s child credit, wiped out the marriage penalty for joint filers and expanded refundable credits. Of the approximately $4 trillion that would be lost if the Bush cuts stayed in place through the next decade, only about $800 billion would go to the wealthiest households making more than $250,000 a year, according to government estimates.

Georgetown University law professor John Buckley recently estimated that 95 percent of the revenue lost to tax expenditures is concentrated in 10 categories that aid families and advance popular policy goals. The “special-interest stuff,” he said, such as write-offs for corporate jets, is minuscule by comparison — “unless we’re all special,” he said.

In the mid-1980s, Reagan administration officials and a Democratic Congress also confronted a tax code eroded by multiplying tax breaks. They concluded that costly breaks, such as a credit that encouraged people to shelter income in unprofitable investments, were keeping tax rates artificially high for everyone.

The resulting overhaul was the most extensive in U.S. history. It repealed or modified dozens of tax expenditures, trimming their overall cost by nearly 40 percent. The resulting savings were not directed to deficit reduction, but used to lower rates across the board, pushing the top rate down from 50 percent to 28 percent.

Huge breaks survived, however. People could still get health insurance from their employers without being taxed, a benefit that originated with wage controls during World War II. And while taxpayers could no longer deduct interest on credit cards, they kept the break for mortgage interest. Policymakers did not want to hurt the real estate and construction industries, and they theorized that the break would continue to encourage people to buy homes.

Burman, then a junior staffer at the Treasury Department, said he warned that it would also encourage people to shoulder ever-larger mortgages. When the housing bubble burst in 2006, he said, “instead of getting into trouble with Visa and MasterCard, people lost their homes.”

The breaks for health insurance and mortgage interest are the most valuable tax expenditures on the books, worth a combined $260 billion this year. They have soared in value, helped along by the increasing size of mortgages and the cost of health insurance.

But a recent effort to cap the value of the health-care exclusion was abandoned amid complaints from labor union officials, who have for years traded wage increases for richer health benefits. Democrats instead enacted a tax on insurers that sell high-cost policies, a provision some lobbyists predict will be further watered down before it is scheduled to take effect in 2013.

Meanwhile, top tax aides said the new debt-reduction “supercommittee” on Capitol Hill could look at capping the mortgage deduction or disallowing it for second homes. Neither is likely, however, and no one has expressed interest in ending the deduction for the vast majority of homeowners.

Caps on spending

After 1986, the tax code emerged leaner and more efficient. But as Norquist began circulating his anti-tax pledge to protect the changes, Congress decided to tackle rising budget deficits by imposing strict caps on spending.

With no place else to go, lawmakers — particularly Democrats — latched onto the tax code as a vehicle for new initiatives.

Buckley, who served until last year as chief Democratic tax counsel on the House Ways and Means Committee, said it started in 1986 with the low-income housing credit for developers and investors. As Reagan’s budget cutters were slashing direct spending on housing, Rep. Charles B. Rangel (D-N.Y.) won bipartisan support for the credit, which quickly became a primary source of financing for housing construction and rehabilitation.

The trend accelerated under Clinton, who found Republican lawmakers far more willing to finance his priorities in the form of tax cuts than as new spending. While Clinton ended traditional welfare programs, he shifted chunks of the social safety net to the tax code, creating an array of benefits for families, including a new credit for every child younger than 17.

“Politically, it was easier to get tax cuts dedicated to a purpose than to get spending dedicated to the same purpose,” said former Obama economic adviser Lawrence H. Summers, who also served as Clinton’s Treasury secretary.

The child credit and the Earned Income Tax Credit, a break for the working poor enacted in 1975, are now two of the federal government’s biggest anti-poverty measures, far larger than the modern welfare program, or even food stamps.

For Clinton, the Taxpayer Relief Act of 1997 had another advantage. It let him make good on a pledge to cut taxes for the middle class without enacting a more expensive rate reduction, said Eric Toder, who served in Clinton’s Treasury Department and is now co-director of the Tax Policy Center. Other Democrats took note.

“If you look at the [Al] Gore campaign or the Obama proposals, just about all their tax cuts are increased tax expenditures,” Toder said. “They really viewed this as the way to give tax cuts to the middle class.”

Rather than tackling these breaks one by one, experts such as Kleinbard and Harvard economist Martin Feldstein, a senior Reagan White House adviser, last week counseled Congress to eliminate or cap all tax breaks for everyone.

Obama has advanced a similar idea that would limit itemized deductions for families earning more than $250,000 a year. But lawmakers have repeatedly rejected it, fearful of antagonizing the industries and charities that benefit, as well as taxpayers themselves.

Kleinbard calls tax expenditures “the sacred tax cows.” But to tame the debt, he said, at least some of them must be led to slaughter. “There’s just no other way to make the numbers work.”

Listen to Lee Kuan Yew!

I found it quite puzzling that few proponents of multiculturalism study the paths of diverse nations that have achieved true social and economic progress. Quite the contrary, Maoist China and Socialist Cuba were the darling of the left, while the quiet success stories like Singapore were largely ignored. Most likely because they pursued market reform and westernization. Since it's independence in 1965, Singapore's economic and social achievements have been stellar: it's per capita GDP grew from $511 to $36,537, dramatically raised living standards of the majority of its citizens, an effective health care system was instituted and illiteracy was virtually eliminated. Now Singapore is known as one of the safest and cleanest cities in the world. While its political system does have autocratic elements, it has moved towards democratization in the last decade. And given its track record, Singapore's efforts at political liberalization are likely to be successful.
Much of the credit goes to Senior Minister Lee Kuan Yew and of course the economic dynamism of the (primarily) Chinese citizens. In an interview with Farees Zakaria, he offered some insightful observations of economic and social developments, which are refreshingly free of the political correctness that shakles most western politicians. Lee Kuan Yew also reflected on the strengths and weaknesses of the American system. And more than anything he emphasizes the power of culture in shaping economic and political outcomes. Of course comparing an East Asian city state to the United States is like comparing apples and oranges, but never the less there are important lessens to be had. Agree, or disagree, the thoughtful insights of successful outsiders should never be disregarded.

March/April, 1994


Foreign Affairs

Culture Is Destiny; A Conversation with Lee Kuan Yew

By Fareed Zakari

"ONE OF THE ASYMMETRIES of history," wrote Henry Kissinger of Singapore's patriarch Lee Kuan Yew, "is the lack of correspondence between the abilities of some leaders and the power of their countries." Kissinger's one time boss, Richard Nixon, was even more flattering. He speculated that, had Lee lived in another time and another place, he might have "attained the world stature of a Churchill, a Disraeli, or a Gladstone." This tag line of a big man on a small stage has been attached to Lee since the 1970s. Today, however, his stage does not look quite so small. Singapore's per capita GNP is now higher than that of its erstwhile colonizer, Great Britain. It has the world's busiest port, is the third-largest oil refiner and a major center of global manufacturing and service industries. And this move from poverty to plenty has taken place within one generation. In 1965 Singapore ranked economically with Chile, Argentina and Mexico; today its per capita GNP is four or five times theirs.

Lee managed this miraculous transformation in Singapore's economy while maintaining tight political control over the country; Singapore's government can best be described as a "soft" authoritarian regime, and at times it has not been so soft. He was prime minister of Singapore from its independence in 1959 (it became part of a federation with Malaysia in 1963 but was expelled in 1965) until 199o, when he allowed his deputy to succeed him. He is now "Senior Minister" and still commands enormous influence and power in the country. Since his retirement, Lee has embarked on another career of sorts as a world-class pundit, speaking his mind with impolitic frankness. And what is often on his mind is American-style democracy and its perils. He travels often to East Asian capitals from Beijing to Hanoi to Manila dispensing advice on how to achieve economic growth while retaining political stability and control. It is a formula that the governing elites of these countries are anxious to learn.

The rulers of former British colonies have been spared the embarrassment of building grandiose monuments to house their offices; they simply occupy the ones that the British built. So it is with Singapore. The president, prime minister and senior minister work out of Istana (palace), the old colonial governor's house, a gleaming white bungalow surrounded by luxuriant lawns. The interior is modern light wood paneling and leather sofas. The atmosphere is hushed. I waited in a large anteroom for the "SM," which is how everybody refers to Lee. I did not wait long. The SM was standing in the middle of a large, sparsely furnished office. He is of medium build. His once-compact physique is now slightly shrunken. Still, he does not look 70.

Lee Kuan Yew is unlike any politician I have met. There were no smiles, no jokes, no bonhomie. He looked straight at me he has an inexpressive face but an intense gaze -- shook hands and motioned toward one of the room's pale blue leather sofas (I had already been told by his press secretary on which one to sit). After 30 awkward seconds, I realized that there would be no small talk. I pressed the record button on my machine.

FZ: With the end of the Cold War, many Americans were surprised to hear growing criticism of their political and economic and social system from elites in East Asia, who were considered staunchly pro-American. What, in your view, is wrong with the American system?
LKY: It is not my business to tell people what's wrong with their system. It is my business to tell people not to foist their system indiscriminately on societies in which it will not work.

FZ: But you do not view the United States as a model for other countries?

LKY: As an East Asian looking at America, I find attractive and unattractive features. I like, for example, the free, easy and open relations between people regardless of social status, ethnicity or religion. And the things that I have always admired about America, as against the communist system, I still do: a certain openness in argument about what is good or bad for society; the accountability of public officials; none of the secrecy and terror that's part and parcel of communist government.

But as a total system, I find parts of it totally unacceptable: guns, drugs, violent crime, vagrancy, unbecoming behavior in public -- in sum the breakdown of civil society. The expansion of the right of the individual to behave or misbehave as he pleases has come at the expense of orderly society. In the East the main object is to have a well-ordered society so that everybody can have maximum enjoyment of his freedoms. This freedom can only exist in an ordered state and not in a natural state of contention and anarchy.

Let me give you an example that encapsulates the whole difference between America and Singapore. America has a vicious drug problem. How does it solve it? It goes around the world helping other antinarcotic agencies to try and stop the suppliers. It pays for helicopters, defoliating agents and so on. And when it is provoked, it captures the president of Panama and brings him to trial in Florida. Singapore does not have that option. We can't go to Burma and capture warlords there. What we can do is to pass a law which says that any customs officer or policeman who sees anybody in Singapore behaving suspiciously, leading him to suspect the person is under the influence of drugs, can require that man to have his urine tested. If the sample is found to contain drugs, the man immediately goes for treatment. In America if you did that it would be an invasion of the individual's rights and you would be sued.

I was interested to read Colin Powell, when he was chairman of the Joint Chiefs of Staff, saying that the military followed our approach because when a recruit signs up he agrees that he can be tested. Now, I would have thought this kind of approach would be quite an effective way to deal with the terrible drug problem you have. But the idea of the inviolability of the individual has been turned into dogma. And yet nobody minds when the army goes and captures the president of another state and brings him to Florida and puts him in jail. I find that incomprehensible. And in any case this approach will not solve America's drug problem. Whereas Singapore's way, we may not solve it, but we will lessen it considerably, as we have done.

FZ: Would it be fair to say that you admired America more 25 years ago? What, in your view, went wrong?

LKY: Yes, things have changed. I would hazard a guess that it has a lot to do with the erosion of the moral underpinnings of a society and the diminution of personal responsibility. The liberal, intellectual tradition that developed after World War II claimed that human beings had arrived at this perfect state where everybody would be better off if they were allowed to do their own thing and flourish. It has not worked out, and I doubt if it will. Certain basics about human nature do not change. Man needs a certain moral sense of right and wrong. There is such a thing called evil, and it is not the result of being a victim of society. You are just an evil man, prone to do evil things, and you have to be stopped from doing them. Westerners have abandoned an ethical basis for society, believing that all problems are solvable by a good government, which we in the East never believed possible.

FZ: Is such a fundamental shift in culture irreversible?

LKY: No, it is a swing of the pendulum. I think it will swing back. I don't know how long it will take, but there's already a backlash in America against failed social policies that have resulted in people urinating in public, in aggressive begging in the streets, in social breakdown.

THE ASIAN MODEL

FZ: You say that your real concern is that this system not be foisted on other societies because it will not work there. Is there another viable model for political and economic development? Is there an "Asian model"?

LKY: I don't think there is an Asian model as such. But Asian societies are unlike Western ones. The fundamental difference between Western concepts of society and government and East Asian concepts -- when I say East Asians, I mean Korea, Japan, China, Vietnam, as distinct from Southeast Asia, which is a mix between the Sinic and the Indian, though Indian culture also emphasizes similar values -- is that Eastern societies believe that the individual exists in the context of his family. He is not pristine and separate. The family is part of the extended family, and then friends and the wider society. The ruler or the government does not try to provide for a person what the family best provides.


In the West, especially after World War II, the government came to be seen as so successful that it could fulfill all the obligations that in less modern societies are fulfilled by the family. This approach encouraged alternative families, single mothers for instance, believing that government could provide the support to make up for the absent father.This is a bold, Huxleyan view of life, but one from which I as an East Asian shy away. I would be afraid to experiment with it. I'm not sure what the consequences are, and I don't like the consequences that I see in the West. You will find this view widely shared in East Asia. It's not that we don't have single mothers here. We are also caught in the same social problems of change when we educate our women and they become independent financially and no longer need to put up with unhappy marriages. But there is grave disquiet when we break away from tested norms, and the tested norm is the family unit. It is the building brick of society.

There is a little Chinese aphorism which encapsulates this idea: Xiushen qijia zhiguo pingtianxia. Xiushen means look after yourself, cultivate yourself, do everything to make yourself useful; Qijia, look after the family; Zhiguo, look after your country; Pingtianxia, all is peaceful under heaven. We have a whole people immersed in these beliefs. My granddaughter has the name Xiu-qi. My son picked out the first two words, instructing his daughter to cultivate herself and look after her family. It is the basic concept of our civilization. Governments will come, governments will go, but this endures. We start with self-reliance. In the West today it is the opposite. The government says give me a popular mandate and I will solve all society's problems.

FZ: What would you do instead to address America's problems?

LKY: What would I do if I were an American? First, you must have order in society. Guns, drugs and violent crime all go together, threatening social order. Then the schools; when you have violence in schools, you are not going to have education, so you've got to put that right. Then you have to educate rigorously and train a whole generation of skilled, intelligent, knowledgeable people who can be productive. I would start off with basics, working on the individual, looking at him within the context of his family, his friends, his society. But the Westerner says I'll fix things at the top. One magic formula, one grand plan. I will wave a wand and everything will work out. It's an interesting theory but not a proven method.

BACK TO BASICS

FZ: You are very skeptical of government's ability to solve deeper social issues. But you're more confident, certainly than many Americans are, in the government's ability to promote economic growth and technological advancement. Isn't this a contradiction?

LKY: No. We have focused on basics in Singapore. We used the family to push economic growth, factoring the ambitions of a person and his family into our planning. We have tried, for example, to improve the lot of children through education. The government can create a setting in which people can live happily and succeed and express themselves, but finally it is what people do with their lives that determines economic success or failure. Again, we were fortunate we had this cultural backdrop, the belief in thrift, hard work, filial piety and loyalty in the extended family, and, most of all, the respect for scholarship and learning.There is, of course, another reason for our success. We have been able to create economic growth because we facilitated certain changes while we moved from an agricultural society to an industrial society. We had the advantage of knowing what the end result should be by looking at the West and later Japan. We knew where we were, and we knew where we had to go. We said to ourselves, "Let's hasten, let's see if we can get there faster." But soon we will face a different situation. In the near future, all of us will get to the stage of Japan. Where do we go next? How do we hasten getting there when we don't know where we're going? That will be a new situation.


FZ: Some people say that the Asian model is too rigid to adapt well to change. The sociologist Mancur Olson argues that national decline is caused most fundamentally by sclerosis -- the rigidity of interest groups, firms, labor, capital and the state. An American-type system that is very flexible, laissez-faire and constantly adapting is better suited to the emerging era of rapid change than a government-directed economic policy and a Confucian value system.

LKY: That is an optimistic and attractive philosophy of life, and I hope it will come true. But if you look at societies over the millennia you find certain basic patterns. American civilization from the Pilgrim fathers on is one of optimism and the growth of orderly government. History in China is of dynasties which have risen and fallen, of the waxing and waning of societies.

And through all that turbulence, the family, the extended family, the clan, has provided a kind of survival raft for the individual. Civilizations have collapsed, dynasties have been swept away by conquering hordes, but this life raft enables the civilization to carry on and get to its next phase. Nobody here really believes that the government can provide in all circumstances. The government itself does not believe it. In the ultimate crisis, even in earthquakes and typhoons, it is your human relationships that will see you through. So the thesis you quote, that the government is always capable of reinventing itself in new shapes and forms, has not been proven in history. But the family and the way human relationships are structured, do increase the survival chances of its members. That has been tested over thousands of years in many different situations.
THE CULTURE OF SUCCESS

FZ: A key ingredient of national economic success in the past has been a culture of innovation and experimentation. During their rise to great wealth and power the centers of growth -- Venice, Holland, Britain, the United States -- all had an atmosphere of intellectual freedom in which new ideas, technologies, methods and products could emerge. In East Asian countries, however, the government frowns upon an open and free wheeling intellectual climate. Leaving aside any kind of human rights questions this raises, does it create a productivity problem?

LKY: Intellectually that sounds like a reasonable conclusion, but I'm not sure things will work out this way. The Japanese, for instance, have not been all that disadvantaged in creating new products. I think that if governments are aware of your thesis and of the need to test out new areas, to break out of existing formats, they can counter the trend. East Asians, who all share a tradition of strict discipline, respect for the teacher, no talking back to the teacher and rote learning, must make sure that there is this random intellectual search for new technologies and products. In any case, in a world where electronic communications are instantaneous, I do not see anyone lagging behind. Anything new that happens spreads quickly, whether it's superconductivity or some new life-style.

FZ: Would you agree with the World Bank report on East Asian economic success, which I interpret to have concluded that all the governments that succeeded got fundamentals right -- encouraging savings and investment, keeping inflation low, providing high-quality education. The tinkering of industrial policies here and targeting sectors there was not as crucial an element in explaining these countries' extraordinary economic growth as were these basic factors.

LKY: I think the World Bank had a very difficult job. It had to write up these very, very complex series of situations. But there are cultural factors which have been lightly touched over, which deserved more weightage. This would have made it a more complex study and of less universal application, but it would have been more accurate, explaining the differences, for example, between the Philippines and Taiwan.

FZ: If culture is so important, then countries with very different cultures may not, in fact, succeed in the way that East Asia did by getting economic fundamentals right. Are you not hopeful for the countries around the world that are liberalizing their economies?

LKY: Getting the fundamentals right would help, but these societies will not succeed in the same way as East Asia did because certain driving forces will be absent. If you have a culture that doesn't place much value in learning and scholarship and hard work and thrift and deferment of present enjoyment for future gain, the going will be much slower.

But, you know, the World Bank report's conclusions are part of the culture of America and, by extension, of international institutions. It had to present its findings in a bland and universalizable way, which I find unsatisfying because it doesn't grapple with the real problems. It makes the hopeful assumption that all men are equal, that people all over the world are the same. They are not.

Groups of people develop different characteristics when they have evolved for thousands of years separately. Genetics and history interact. The Native American Indian is genetically of the same stock as the Mongoloids of East Asia -- the Chinese, the Koreans and the Japanese. But one group got cut off after the Bering Straits melted away. Without that land bridge they were totally isolated in America for thousands of years. The other, in East Asia, met successive invading forces from Central Asia and interacted with waves of people moving back and forth. The two groups may share certain characteristics, for instance if you measure the shape of their skulls and so on, but if you start testing them you find that they are different, most particularly in their neurological development, and their cultural values.

Now if you gloss over these kinds of issues because it is politically incorrect to study them, then you have laid a land mine for yourself. This is what leads to the disappointments with social policies, embarked upon in America with great enthusiasm and expectations, but which yield such meager results. There isn't a willingness to see things in their stark reality. But then I am not being politically correct.

FZ: Culture may be important, but it does change. The Asian "model" may prove to be a transitional phenomenon. After all, Western countries also went through a period in the eighteenth and nineteenth centuries when they were capitalist and had limited participatory democracy. Elites then worried -- as you do today -- that "too much" democracy and "too many" individual rights would destabilize social order. But as these societies modernized and as economic growth spread to all sections of society, things changed. Isn't East Asia changing because of a growing middle class that demands a say in its own future?


LKY: There is acute change in East Asia. We are agricultural societies that have industrialized within one or two generations. What happened in the West over 200 years or more is happening here in about 50 years or less. It is all crammed and crushed into a very tight time frame, so there are bound to be dislocations and malfunctions. If you look at the fast-growing countries -- Korea, Thailand, Hong Kong, and Singapore -- there's been one remarkable phenomenon: the rise of religion. Koreans have taken to Christianity in large numbers, I think some 25 percent. This is a country that was never colonized by a Christian nation. The old customs and religions -- ancestor worship, shamanism -- no longer completely satisfy. There is a quest for some higher explanations about man's purpose, about why we are here. This is associated with periods of great stress in society. You will find in Japan that every time it goes through a period of stress new sects crop up and new religions proliferate. In Taiwan -- and also in Hong Kong and Singapore -- you see a rise in the number of new temples; Confucianist temples, Taoist temples and many Christian sects.

We are all in the midst of very rapid change and at the same time we are all groping towards a destination which we hope will be identifiable with our past. We have left the past behind and there is an underlying unease that there will be nothing left of us which is part of the old. The Japanese have solved this problem to some extent. Japan has become an industrial society, while remaining essentially Japanese in its human relations. They have industrialized and shed some of their feudal values. The Taiwanese and the Koreans are trying to do the same. But whether these societies can preserve their core values and make this transition is a problem which they alone can solve. It is not something Americans can solve' for them. Therefore, you will find people unreceptive to the idea that they be Westernized. Modernized, yes, in the sense that they have accepted the inevitability of science and technology and the change in the lifestyles they bring.

FZ: But won't these economic and technological changes produce changes in the mind-sets of people?

LKY: It is not just mind-sets that would have to change but value systems. Let me give anecdotal evidence of this. Many Chinese families in Malaysia migrated in periods of stress, when there were race riots in Malaysia in the 1960s, and they settled in Australia and Canada. They did this for the sake of their children so that they would get a better education in the English language because then Malaysia was switching to Malay as its primary language. The children grew up, reached their late teens and left home. And suddenly the parents discovered the emptiness of the whole exercise. They had given their children a modern education in the English language and in the process lost their children altogether. That was a very sobering experience. Something less dramatic is happening in Singapore now because we are not bringing up our children in the same circumstances in which we grew up.

FZ: But these children are absorbing influences different from your generation. You say that knowledge, life-styles, culture all spread rapidly in this world. Will not the idea of democracy and individual rights also spread?

LKY: Let's not get into a debate on semantics. The system of government in China will change. It will change in Korea, Taiwan, Vietnam. It is changing in Singapore. But it will not end up like the American or British or French or German systems. What are we all seeking? A form of government that will be comfortable, because it meets our needs, is not oppressive, and maximizes our opportunities. And whether you have one-man, one-vote or some-men, one vote or other men, two votes, those are forms which should be worked out. I'm not intellectually convinced that one-man, one-vote is the best. We practice it because that's what the British bequeathed us and we haven't really found a need to challenge that. But I'm convinced, personally, that we would have a better system if we gave every man over the age of 40 who has a family two votes because he's likely to be more careful, voting also for his children. He is more likely to vote in a serious way than a capricious young man under 30. But we haven't found it necessary yet. If it became necessary we should do it. At the same time, once a person gets beyond 65, then it is a problem. Between the ages of 40 and 60 is ideal, and at 60 they should go back to one vote, but that will be difficult to arrange.

MULTICULTURAL SCHISMS

FZ: Change is often most threatening when it occurs in multiethnic societies. You have been part of both a multiethnic state that failed and one that has succeeded. Malaysia was unwilling to allow what it saw as a Chinese city-state to be part of it and expelled Singapore from its federation in 1965. Singapore itself, however, exists peacefully as a multiethnic state. Is there a solution for those states that have ethnic and religious groups mixed within them?

LKY: Each state faces a different set of problems and I would be most reluctant to dish out general solutions. From my own experience, I would say, make haste slowly. Nobody likes to lose his ethnic, cultural, religious, even linguistic identity. To exist as one state you need to share certain attributes, have things in common. If you pressure-cook you are in for problems. If you go gently, but steadily, the logic of events will bring about not assimilation, but integration. If I had tried to foist the English language on the people of Singapore I would have faced rebellion all around. If I had tried to foist the Chinese language, I'd have had immediate revolt and disaster.

But I offered every parent a choice of English and their mother tongue, in whatever order they chose. By their free choice, plus the rewards of the marketplace over a period of 30 years, we have ended up with English first and the mother tongue second. We have switched one university already established in the Chinese language from Chinese into English. Had this change been forced in five or ten years instead of being done over 30 years -- and by free choice-- it would have been a disaster.

FZ: This sounds like a live-and-let-live kind of approach. Many Western countries, particularly the United States and France, respectively, have traditionally attempted to assimilate people toward a national mainstream -- with English and French as the national language, respectively. Today this approach is being questioned, as you know, with some minority groups in the United States and France arguing for "multiculturalism," which would allow distinct and unassimilated minority groups to coexist within the nation. How does this debate strike you as you read about it in Singapore?


LKY: You cannot have too many distinct components and be one nation. It makes interchangeability difficult. If you want complete separateness then you should not come to live in the host country. But there are circumstances where it is wise to leave things be. For instance, all races in Singapore are eligible for jobs and for many other things. But we put the Muslims in a slightly different category because they are extremely sensitive about their customs, especially diet. In such matters one has to find a middle path between uniformity and a certain freedom to be somewhat different. I think it is wise to leave alone questions of fundamental beliefs and give time to sort matters out.

FZ: So you would look at the French handling of their Muslim minorities and say "Go slow, don't push these people so hard."

LKY: I would not want to say that because the French having ruled Algeria for many years know the kind of problems that they are faced with. My approach would be, if some Muslim girl insists on coming to school with her headdress on and is prepared to put up with that discomfort, we should be prepared to put up with the strangeness. But if she joined the customs or immigration department where it would be confusing to the millions of people who stream through to have some customs officer looking different, she must wear the uniform. That approach has worked in Singapore so far.

IS EUROPE'S PAST ASIA'S FUTURE?

FZ: Let me shift gears somewhat and ask you some questions about the international climate in East Asia. The part of the world you live in is experiencing the kind of growth that the West has experienced for the last 400 years. The West has not only been the world's great producer of wealth for four centuries, it has also been the world's great producer of war. Today East Asia is the locus of great and unsettling growth, with several newly rising powers close to each other, many with different political systems, historical animosities, border disputes, and all with ever-increasing quantities of arms. Should one look at this and ask whether Europe's past will be East Asia's future?

LKY: No, it's too simplistic. One reason why growth is likely to last for many years in East Asia -- and this is just a guess -- is that the peoples and the governments of East Asia have learned some powerful lessons about the viciousness and destructiveness of wars. Not only full-scale wars like in Korea, but guerrilla wars as in Vietnam, in Cambodia and in the jungles of Malaysia, Thailand, Indonesia and the Philippines. We all know that the more you engage in conflict, the poorer and the more desperate you become. Visit Cambodia and Vietnam; the world just passed them by. That lesson will live for a very long time, at least as long as this generation is alive.

FZ: The most unsettling change in an international system is the rise of a new great power. Can the rise of China be accommodated into the East Asian order? Isn't that kind of growth inevitably destabilizing?

LKY: I don't think we can speak in terms of just the East Asian order. The question is: Can the world develop a system in which a country the size of China becomes part of the management of international peace and stability? Sometime in the next 20 or 30 years the world, by which I mean the major powers, will have to agree among themselves how to manage peace and stability, how to create a system that is both viable and fair. Wars between small countries won't destroy the whole world, but will only destroy themselves. But big conflicts between big powers will destroy the world many times over. That's just too disastrous to contemplate.

At the end of the last war what they could foresee was the United Nations. The hope was that the permanent five would maintain the rule of law or gradually spread the rule of law in international relations. It did not come off because of Stalin and the Cold War. This is now a new phase. The great powers -- by which I mean America, Western Europe as a group if they become a union, Japan, China and, in 20 to 30 years time, the Russian republic -- have got to find a balance between themselves. I think the best way forward is through the United Nations. It already has 48 years of experience. It is imperfect, but what is the alternative? You can not have a consortium of five big powers lording it over the rest of mankind. They will not have the moral authority or legitimacy to do it. Are they going to divide the world into five spheres of influence?

So they have to fall back on some multilateral framework and work out a set of rules that makes it viable. There may be conflicts of a minor nature, for instance between two Latin American countries or two small Southeast Asian countries; that doesn't really matter. Now if you have two big countries in South Asia like India and Pakistan and both with nuclear capabilities, then something has to be done. It is in that context that we have to find a place for China when it becomes a major economic and military power.

FZ: Is the Chinese regime stable? Is the growth that's going on there sustainable? Is the balancing act between economic reform and political control that Deng Xiaoping is trying to keep going sustainable after his death?

LKY: The regime in Beijing is more stable than any alternative government that can be formed in China. Let us assume that the students had carried the day at Tiananmen and they had formed a government. The same students who were at Tiananmen went to France and America. They've been quarreling with each other ever since. What kind of China would they have today? Something worse than the Soviet Union. China is a vast, disparate country; there is no alternative to strong central power.

FZ: Do you worry that the kind of rapid and unequal growth taking place in China might cause the country to break up?


LKY: First, the economy is growing everywhere, even in Sichuan, in the heart of the interior. Disparate growth rates are inevitable. It is the difference between, say, California before the recession and the Rust Belt. There will be enormous stresses because of the size of the country and the intractable nature of the problems -- the poor infrastructure, the weak institutions, the wrong systems that they have installed, modeling themselves upon the Soviet system in Stalin's time. Given all those handicaps, I am amazed that they have got so far.

FZ: What about the other great East Asian power? If Japan continues on the current trajectory, should the world encourage the expansion of its political and military responsibilities and power?


LKY: No. I know that the present generation of Japanese leaders do not want to project power. I'm not sure what follows when leaders born after the war take charge. I doubt if there will be a sudden change. If Japan can carry on with its current policy, leaving security to the Americans and concentrating on the economic and the political, the world will be better off. And the Japanese are quite happy to do this. It is when America feels that it's too burdensome and not worth the candle to be present in East Asia to protect Japan that it will have to look after its own security. When Japan becomes a separate player, it is an extra joker in the pack of cards.

FZ: You've said recently that allowing Japan to send its forces abroad is like giving liquor to an alcoholic.

LKY: The Japanese have always had this cultural trait, that whatever they do they carry it to the nth degree. I think they know this. I have Japanese friends who have told me this. They admit that this is a problem with them.

FZ: What if Japan did follow the trajectory that most great powers have; that it was not content simply to be an economic superpower, "a bank with a flag" in a writer's phrase? What if they decided they wanted to have the ultimate mark of a great power -- nuclear weapons? What should the world do?

LKY: If they decided on that the world will not be able to stop them. You are unable to stop North Korea. Nobody believes that an American government that could not sustain its mission in Somalia because of an ambush and one television snippet of a dead American pulled through the streets in Mogadishu could contemplate a strike on North Korean nuclear facilities like the Israeli strike on Iraq. Therefore it can only be sanctions in the U.N. Security Council. That requires that there be no vetoes. Similarly, if the Japanese decide to go nuclear, I don't believe you will be able to stop them. But they know that they face a nuclear power in China and in Russia, and so they would have to posture themselves in such a way as not to invite a preemptive strike. If they can avoid a preemptive strike then a balance will be established. Each will deter the others.


FZ: So it's the transition period that you are worried about.

LKY: I would prefer that the matter never arises and I believe so does the world. Whether the Japanese go down the military path will depend largely on America's strength and its willingness to be engaged.

VIVE LA DIFFERENCE

FZ: Is there some contradiction here between your role as a politician and your new role as an intellectual, speaking out on all matters? As a politician you want America as a strong balancer in the region, a country that is feared and respected all over the world. As an intellectual, however, you choose to speak out forcefully against the American model in a way that has to undermine America's credibility abroad.

LKY: That's preposterous. The last thing I would want to do is to undermine her credibility. America has been unusual in the history of the world, being the sole possessor of power -- the nuclear weapon -- and the one and only government in the world unaffected by war damage whilst the others were in ruins. Any old and established nation would have ensured its supremacy for as long as it could. But America set out to put her defeated enemies on their feet, to ward off an evil force, the Soviet Union, brought about technological change by transferring technology generously and freely to Europeans and to Japanese, and enabled them to become her challengers within 30 years. By 1975 they were at her heels. That's unprecedented in history. There was a certain greatness of spirit born out of the fear of communism plus American idealism that brought that about. But that does not mean that we all admire everything about America.

Let me be frank; if we did not have the good points of the West to guide us, we wouldn't have got out of our backwardness. We would have been a backward economy with a backward society. But we do not want all of the West.

A CODA ON CULTURE

THE DOMINANT THEME throughout our conversation was culture. Lee returned again and again to his views on the importance of culture and the differences between Confucianism and Western values. In this respect, Lee is very much part of a trend. Culture is in. From business consultants to military strategists, people talk about culture as the deepest and most determinative aspect of human life.

I remain skeptical. If culture is destiny, what explains a culture's failure in one era and success in another? If Confucianism explains the economic boom in East Asia today, does it not also explain that region's stagnation for four centuries? In fact, when East Asia seemed immutably poor, many scholars -- most famously Max Weber -- made precisely that case, arguing that Confucian-based cultures discouraged all the attributes necessary for success in capitalism.

Today scholars explain how Confucianism emphasizes the essential traits for economic dynamism. Were Latin American countries to succeed in the next few decades, we shah surely read encomiums to Latin culture. I suspect that since we cannot find one simple answer to why certain societies succeed at certain times, we examine successful societies and search within their cultures for the seeds of success. Cultures being complex, one finds in them what one wants.

What explains Lee Kuan Yew's fascination with culture? It is not something he was born with. Until his thirties he was called "Harry" Lee (and still is by family and friends). In the 1960s the British foreign secretary could say to him, "Harry, you're the best bloody Englishman east of the Suez." This is not a man untouched by the West. Part of his interest in cultural differences is surely that they provide a coherent defense against what he sees as Western democratic imperialism. But a deeper reason is revealed in something he said in our conversation: "We have left the past behind, and there is an underlying unease that there will be nothing left of us which is part of the old."

Cultures change. Under the impact of economic growth, technological change and social transformation, no culture has remained the same. Most of the attributes that Lee sees in Eastern cultures were once part of the West. Four hundred years of economic growth changed things. From the very beginning of England's economic boom, many Englishmen worried that as their country became rich it was losing its moral and ethical base. "Wealth accumulates and men decay," wrote Oliver Goldsmith in 1770. It is this "decay" that Lee is trying to stave off. He speaks of the anxious search for religion in East Asia today, were from the book East Asia: Tradition and Transformation, by John Fairbank, an American scholar. and while he never says this, his own quest for a Confucian alternative to the West is part of this search.

But to be modern without becoming more Western is difficult; the two are not wholly separable. The West has left a mark on "the rest," and it is not simply a legacy of technology and material products. It is, perhaps most profoundly, in the realm of ideas. At the close of the interview Lee handed me three pages. This was, he explained, to emphasize how alien Confucian culture is to the West. The pages
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