Social Scientist. v 4, no. 38 (Sept 1975) p. 4.

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over American power and American influence locally and globally. I hope to show that what we have witnessed in Indochina is no isolated, inexplicable, random episode in the history of South-East Asia but the working-out of the consequences of those imperatives which shaped the agenda for postwar capitalism and of the conscious choices made by the men responsible for implementing the actions accordingly indicated.

It will be necessary to go back for a moment to the situation as it developed in the inter-war period. For the sake of brevity I shall reduce what is a complex play of forces to two basic elements: first, the consequences of the great inter-war economic depression and the conclusions which the managers of capitalism drew from it; and, second, the configuration of economic and political rivalries which emerged from the crisis specifically in South-East Asia.

Crisis and Contradictions

The crisis of the post-1929 years was of unprecedented severity1 and compelled all those concerned in decision making, whether in business, politics or (as advisers) academic life, urgently to address themselves to seeking cures for the ills that afflicted capitalism. By and large, they failed to do so until the Second World War created the conditions for rolling up unemployment and for absorbing unused productive capacity. But intimations of the future were not lacking. Outside the western democracies, empircal evidence for what was required was accumulating during the 1830s in the comparative success of the fascist countries in achieving upswing through militarization and expansionism. Roosevelt's pump-priming by welfarism and statism, though limited in magnitude, could be— and was—interpreted as a step in the right direction. And a number of economists, notably John Maynard Keynes in England, were striving towards a theory and practice of managed capitalism. On the other side of the coin, the 1920s and 1930s witnessed a vigourous surge of nationalist and social revolutionary activity in South-East Asia—with premonitions of what was to come in the communist uprisings in Indonesia in 1926-27 and in Vietnam in 1930-31 and in the numerous peasant-based anti-western movements such as the Saya San in Burma and the Sakdalistas in the Philippines. For all the forlorn rearguard actions still to come, whatever remained oflaissez-foire capitalism, and with it classical colonialism, was as good as dead.

The depression had most serious consequences for South-East Asia. Raw material prices collapsed, and with them the tenuous purchasing power of the local peoples. The old colonial powers—Britain^ Holland, and France—reacted by elaborating a number of commodity restriction schemes designed to reduce output and export (and therefore raise the prices) of primary products, and by taking steps to exclude the consumer goods of more efficient and competitive rivals, such as Japan. The first set of actions antagonized the United States which was historically in the process of transformation from having been a net exporter of raw materials

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