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Back issues of BCAS publications published on this site are

intended for non-commercial use only. Photographs and

other graphics that appear in articles are expressly not to be

reproduced other than for personal use. All rights reserved.

CONTENTS

Vol. 16, No. 4: OctoberDecember 1984

Michael A. Launius - The State and Industrial Labor in South Korea

Vivian Lin - Productivity First: Japanese Management Methods inSingapore

John A. Lent - The Restructuring of Mass Media in Malaysia andSingapore: Pounding in the Coffins Nails?

Hans Borkent - Indonesian Sketches

Jim Warren - Living on the Razors Edge: The Rickshawmen of Singapore Between Two Wars, 19191939

Stephen Vlastos - Teaching the Vietnam War: Objectivity in theClassroom?

Jon Halliday - Further Bibliography of North Korea

Richard Levy - Mao, Maoism, and China. The Foundations of Mao Zedongs Political Thought, 19171935, by Brantley Womack; andCult and Canon: The Origins and Development of State Maoism, byHelmut Martin / A Review Essay

Tom Grunfeld - La Chine: La Question des Minorites en Chine, byCharles Le Blanc and Dennis Helly, eds. / A Review

Elly van Gelderen - West-Papua: The Obliteration of a People, byTAPOL ed. / A Review

Elaine Kurtenbach - Peasants and Politics in Kampuchea,19421981, by Ben Kiernan and Chanthou Boua / A Review

Tom Grunfeld - Deadly Deceits: My 25 Years in the CIA , by RalphW. McGehee / A Review

BCAS/ Critical Asian Studies www.bcasnet.org

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CCAS Statement of Purpose

Critical Asian Studies continues to be inspired by the statement of purpose

formulated in 1969 by its parent organization, the Committee of Concerned Asian Scholars (CCAS). CCAS ceased to exist as an organization in 1979,but the BCAS board decided in 1993 that the CCAS Statement of Purpose should be published in our journal at least once a year.

We first came together in opposition to the brutal aggression of the United States in Vietnam and to the complicity or silence of our profession with regard to that policy. Those in the field of Asian studies bear responsibility for the consequences of their research and the political posture of their profession. We are

concerned about the present unwillingness of specialists to speak out against the implications of an Asian policy committed to en-suring American domination of much of Asia. We reject the le-gitimacy of this aim, and attempt to change this policy. Werecognize that the present structure of the profession has often perverted scholarship and alienated many people in the field.

The Committee of Concerned Asian Scholars seeks to develop ahumane and knowledgeable understanding of Asian societies

and their efforts to maintain cultural integrity and to confrontsuch problems as poverty, oppression, and imperialism. We real-ize that to be students of other peoples, we must first understandour relations to them.

CCAS wishes to create alternatives to the prevailing trends inscholarship on Asia, which too often spring from a parochialcultural perspective and serve selfish interests and expansion-ism. Our organization is designed to function as a catalyst, a

communications network for both Asian and Western scholars, a provider of central resources for local chapters, and a commu-nity for the development of anti-imperialist research.

Passed, 2830 March 1969 Boston, Massachusetts

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Vol. 16, No. 4/0ct.-Dec., 1984

Contents

MichaelA. Launius 2 The State and Industrial Labor in South KoreaVivian Lin 12 Productivity First: Japanese Management Methods

in SingaporeJohnA. Lent 26 Restructuring of Mass Media in Malaysia and

Singapore- Pounding in the Coffin Nails?Hans Borkent 36 Indonesian Sketches

Jim Warren 38 Living on the Razor's Edge: The Rickshawmen ofSingapore between Two Wars, 1919-1939

Stephen Vlastos 52 Teaching the Vietnam War: Objectivityin the Classroom?

Jon Halliday 56 Further Bibliography on North KoreaRichard Levy 58 Mao, Maoism and China; The Foundations of

MaoZedong's Political Thought, 1917-1935,by Brantley Womack, and Cult and Canon:The Origins and Development of-State Maoism,by Helmut Martin/review essay

Tom Grunfeld 64 La Chine: La Question des Minorites en Chine,by Charles Le Blanc and Denise Helly, eds.lreview

Elly van Gelderen 66 West-Papua: The Obliteration of a People,by TAPOL, ed.lreview

Elaine Kurtenbach 68 Peasants and Politics in Kampuchea, 1942-1981,by Ben Kiernan and Chan hou Boua/review

Tom Grunfeld 70 Deadly Deceits: My 25 Years in the CIA,by Ralph W. McGehee/review

72 List of Books To ReviewIndex

Contributors

Hans Borkent: INDOC, Leiden,The Netherlands John A. Lent: School of Communications, Temple University,Philadelphia, PennsylvaniaTom Grunfeld: Department of History, SUNY IEmpire State

College, New York, New York Richard Levy: Writer on China, Jamaica Plain, Massachusetts

Jon Halliday: Writer on Japan and Korea, London, England Vivian Lin: Transnational Corporations Research Project, University of Sydney, Balmain, NSW, AustraliaElaine Kurtenbach: East-West Center, University of Hawaii,

Honolulu, Hawaii Elly van Gelderen: Westmount, Quebec, Canada

Michael A. Launius: Department of Political Science, College Stephen Vlastos: Department of History, University of Iowa, of St. Thomas, St. Paul, Minnesota Iowa City, Iowa

Jim Warren: School of Social Inquiry, Murdoch University,Murdoch, W A, Australia'

The cover illustrations and the fine drawings of Indonesia appearingthroughout this issue are by Hans Borken! 1984, Leiden, The Netherlands

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The State and Industrial Labor in South Korea

by Michael A. Launius

In recent years a growing awareness has emerged in thefield of modem Korean studies of the role that the state hasplayed in the dramatic economic growth and social transformation of South Korea. Increasingly, the literature has come tofocus on specific strategies and policies through which the statehas pursued such developmental goals as increased industrialproduction, social stability and enhanced national security.This essay seeks to contribute to that growing body of literaturethrough examination of the political and economic conse

quences of state policies directed toward the industrial labormovement, particularly organized labor represented by thecountry's unions. Most studies have heretofore left outdiscussion of organized labor's role in and contribution to theKorean "economic miracle" and this study may shed some lightonto why that has been the case. *

The State in South KoreaAs a newly industrializing country (NIC) and one of the

"little dragons" of East Asia (along with Taiwan, Hong Kong,and Singapore), South Korea has adopted strategies emphasizing industrial expansion and diversification, export promotion,the introduction of advanced-level technologies and theinducement of large-scale capital imports in an attempt totelescope development into as short a time span as possible.In the Korean context, these strategies have been orchestratedby a strong and interventionist stale, one manifestly interested

* An earl ier version of this paper was presented at the 35th Annual Meetingof the Association for Asian Studies, March 25-27, 1983 in San Francisco.

I. Han Sung-joo, "Power, Dependence, and Representation in South Korea,"Paper presented at the APSA annual meeting, 1977; L.L. Wade and B.S.Kim, Economic Development of South Korea: The Political Economy ofSuccess (New York: Praeger, 1978); Parvez Hasan and D.C. Rao, Korea:Policylssuesfor Long-Term Development (Baltimore: Johns Hopkins, 1979).

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in carrying out a kind of political and economic revolutionfrom above. 2 The architect of this state was Park Chung-hee,who drew his inspiration from late-industrializing countrieslike Prussia, Egypt, Turkey, and especially from the exampleof Meiji Japan. Park had served as an officer in the Japanesecolonial army during its occupation of Korea and northernChina and had seen with his own eyes the industrial andinfrastructural development wrought by the Japanese duringtheir brief tenure in Korea and Manchuria. One indication of

the impact that model made on Park was his appropriation ofthe term Yushin ("revitalizing reform" from the Japanese ishin,renovation) for his reform of Korea's political and economicsystem in 1972. Yushin was to be Korea's version of the MeijiRestoration (Ishin), the symbol of the sweeping changes fromabove that facilitated Japan's rapid modernization. Under therubric of these Yushin reforms Park amassed sweeping powersfor the presidency. He reduced and diluted the powers of theNational Assembly, debilitated his own political party (theDemocratic Republican Party-DRP), muzzled the press, andemasculated the labor movement-all in the name of nationalstability and security.

The striking similarities between Japan of the 1930s andKorea in the 1960s and 1970s originated in the mutual desire

to create and sustain what the Meiji Japanese referred to asFukoku Kyohei-Iiterally a "rich country and powerfulmilitary."3 In the Korean context, economic and social policiesare usually designed to complement policies aimed at securingstability and national defense. And development with stability

2. Ellen Kay Trimberger, Revolution From Above (New Brunswick:Transaction Books, 1978).3. Kim Jai-hyup, The Garrison State in Pre-War Japan and Post-War Korea:A Comparative Analysis of Military Politics (Washington, D.C.: UniversityPress of America, 1978).

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means the creation of a political system wherein the makersof public policy can act autonomously, that is, free from theinterference and demands of non-elite classes. To borrowCardoso's terminology, the Korean state is a pact ofdomination, an alliance or coalition of elites which exerciseshegemony over the rest of society. 4 It is essentially theauthoritarian state described by O'Donnell-comprehensive in

the scopeof

its authority, interventionist in society'S affairs,penetrating in its intrusiveness, repressive in limiting politicalparticipation, highly bureaucratized, dependent upon technocratic planners, and highly reliant upon foreign sources ofsupport. 5 In short, it is a bureaucratic-authoritarian stateconstituted as a coalition of the military, technocrats, civilbureaucrats, and big business interests very much tied to foreigneconomic and political supports.

In November 1979 Park Chung-hee was assassinated byhis own chief of intelligence Kim Jae-gyu who, according totestimony given at his trial, was acting to prevent furtherbloodshed and instability arising from the suppression ofstudent and worker protests by the Park regime. Park'ssuccessor, Choi Kyu-ha made promises to scrap the Yushin

constitution and reform measures were underway when he wasoverthrown in a coup d'etat led by general Chun Doo-hwan inMay, 1980. Chun moved quickly to quell dissent by declaringmartial law, dissolving the National Assembly, arrestingopposition politicians, dissolving political parties, and purginggovernment agencies, universities, and trade unions ofpotential opposition. In October 1980 a new constitution wasimplemented replacing the Yushin constitution of October1972, and in March 1981 Chun was inaugurated president ofthe new Fifth Republic with a single term of seven years. InMarch 1981 the new (and essentially powerless) NationalAssembly was elected and dominated by Chun's DemocraticJustice Party (DJP). Two "official" opposition parties alsooccupy seats in the National Assembly but most Koreans

consider them to be "Sakura" parties, shams set up by theregime to give the appearance of a viable opposition.While differences between the Park and Chun regimes do

exist, the character and structure of the state remainsfundamentally the same. It is still a pact of dominationrepresenting the interests of the elite classes and exercises itsauthority essentially independently of constraints from civilsociety. This authoritarian, elite rule has had far-reachingconsequences for Korean society as a whole as well as for oneclass in particular, industrial labor.

Economic PerformanceBetween 1962 and 1983 the GNP of South Korea rose

from $2.3 to $75 billion. Recent optimistic projectionsanticipate a GNP of $100 billion by 1988 (the year that Koreaplans to host the Olympic games) and the achievement ofadvanced nation status by the end of this decade. GNP per

4. Fernando Henrique Cardoso, "On the Characterization of AuthoritarianRegimes in Latin America," in The New Authoritarianism in Latin America,David Collier, ed. (Princeton: Princeton University Press, 1979). p. 38.5. Guillermo O'Donnell, "Corporatism and the Question of the State," inAuthoritarianism and Corporatism in Latin America, James M. Malloy, ed.(Pittsburg: Pittsburg University Press, 1977), p. 54.

capita during the period rose from $87 to $1,800. 6 Even duringthe global economic downturn of the late I 970s and early 1980sSouth Korea averaged rates of GNP growth of 5-6% per annumand, fueled by the recent economic recovery in the advancedindustrial countries, the nation registered an impressive 9.3percent GNP growth in 1983. 7

Organized industrial labor is viewed by thestate as a potential threat to the continued successof o n o m i cgrowth and to national solidarity inthe face of the perceived military threat fromNorth Korea. Mechanisms for structuring andmanipulating industrial workers for state purposes are, therefore, r e f t ~ t e dquite early in thevarious labor laws.

Sectoral shares of the GNP have changed significantlywith mining and manufacturing accounting for over 31 percentin 1981 versus 16.2 percent in 1962. The growth rate of thissector leads all others with an average annual rate of 15.5percent from 1962 to 1981. Even more spectacularly, the valueof manufactured exports rose from $15.31 million in 1962 to$24.4 billion in 1983. 8 Almost 93 percent of exports aremanufactured goods and they account for roughly one-third oftotal GNP as of 1983. The roughly 50 percent of manufacturingproduction which is exported is an indication of the tremendousaggregate growth and structural transformation of the economyfueled by labor-intensive consumer durables and heavy and

chemical industry products.Being tightly tied to the international market meansvulnerability to fluctuations in the economies of the importingcountries, particularly Japan and the United States. When theireconomies are booming, Korean exports swell, but when theyexperience recession, as was the case in the late 1970s andearly 1980s, Korean exports fall and the economy as a wholemay contract. Until quite recently Korean exports were rathersluggish, growing only 1.2 percent in 1982 ($220 million)while the economy as a whole grew 5.4 percent. 9 Good harvestsand government deficit spending accounted for much of thegrowth recorded in this period. While the economy reboundedin 1983, led by increased exports to the U.S. and Middle East,the emphasis began to shift from light industrial goods to heavyand chemical industry products. Exports of goods in the lattercategory jumped by 30 percent over 1982 totals to account for

6. Bank of Korea, Principle Economic Indicators, No.9, 1984. (Seoul: Bankof Korea, 1984), p. 4.7. Korea Development Institute, KDI Quarterly Economic Outlook, Spring,1984. (Seoul, KDI, 1984). p. 4.8. Ibid. p. 10.9. Economic Planning Board, Major Statistics on Korean Economy: 1982(Seoul: EPB, 1982). pp. 3-4; and Economic Planning Board, EconomicBulletin, February 10, 1983. p. II .

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over 50 percent of total manufactured exports, while exportsin the former category grew by only 1.7 percent to account forless than 40 percent of total manufactured exports. 1(' Thesefigures seem to suggest that South Korea is indeed making thetransition from concentrating on light industry exports toconcentrating on heavy and chemical exports, a pledge oftenmade by the late president Park.

The success of this export surge has led to someunexpected problems. Increasingly, in the United States andWestern Europe, South Korean exports are viewed asthreatening domestic industries and political pressures arerising for protectionist measures." Concerned that they will bemade to pay the price for Japan's huge trade surplus with theU. S. and Europe, the Koreans sent a high-powered tradedelegation to the U.S. in March 1984 to lobby for Koreanexports and negotiate contracts for the potential purchase of$1 billion worth of U.S. goods. Led by former Prime MinisterNam Duck-woo (currently head of the Korea TradersAssociation) the mission was to convince Americans that Koreais different from other countries, such as Japan and Taiwan.Said Nam, "The crucial thrust is for us to maintain our share

in the U.S. market...

we depend more than anything elseon access to the international markets" in order to support SouthKorea's economic health, military capabilities and to servicethe foreign debt. 12 Nam went on to say:

Without exports, we cannot pay back the debt. . . . So if theUnited States curbs Korea's exports, that's surely against theinterest of the American banking industry, because they have theheavy exposure in Korea . . . . You should have, you know, enoughof a lesson from the experience in Latin America."

Exports to the U.S. market are likely to continue to growconsidering the economic diplomacy of Dr. Nam and the entryinto the American market of such Korean products asautomobiles (both Hyundai Industries and Daewoo plan tobegin exporting cars to the U.S. within the next two years).

Sluggish exports may indeed aggravate Korea's debtsituation. Korea is the largest borrower in Asia and the world'sfourth largest debtor, with a total outstanding debt of $40 billionas of I983-almost 60 percent of GNP. The debt-service ratioin past years has hovered around 14 percent; 13.8 percent in1981,15.5 percent in 1982, and 13 percent in 1983.14 Foreignexchange and gold reserves are only about $2.3 billion so Koreais continually pushed to keep the exports flowing in order toearn valuable foreign exchange to service the debt. Thisnecessity drives Korean businesses deeper into the battle toundercut the prices of competitors by accepting very thin profitmargins and perhaps even engaging in "dumping" practices. 15This shaky debt situation has yet to discourage lenders,however, due to the excellent past record of Korea in making

10. KDI, KDI Quarterly Economic Outlook, op. cit. p. II .II . James B. Treece, "South Korea is Irked by Its Image as a Second Japan,"in The Asian Wall Street Journal Weekly, April 23, 1984. p. 6.12. Hobart Rowan, "Korea: Fears of a U.S. Backlash," in The WashingtonPost National Weekly Edition, March 26, 1984. p. 10.13. Ibid.14. Business Week, December 27, 1982, p. 24; and Peter Truell, "Lendingto Asia is Expected to Slow for the Rest of 1984," in The Asian Wall StreetJournal Weekly, March 19, 1984. p. 12.15. Ibid.

its scheduled payments.While relatively small in comparison to foreign loans,

foreign direct investment has been important to South Koreandevelopment. Between 1962 and 1982 over $1.4 billion inforeign equity investment was made, the lion's share fromJapan (47.1 percent) and the U.S. (29 percent). 16 By the endof 1983 roughly one-third of this total had been repatriated inthe form of profits or divestiture. About two-thirds of this $1.4billion was invested in manufacturing industries (mainlychemicals, electric, and electronics industries) and the rest insocial overhead capital projects. Ii Multinational capital hasinvested in Korea primarily to take advantage of the relativelylow wages paid to skilled and disciplined workers. ,. Oneforeign corporate executive in Seoul was recently ljuoted assaying, "I t is in our own sellish interest to have a stronggovernment that controls the ,tudellls and labor , 0 thateverything will blossom and grow and we can continue to makeprofits."'" Needless to say the same could be said of Koreanbusinesses in the export game. Sta\l' manipulation of Industriallabor in general and organized labor in particular has beeninstrumental in keeping high wage,. strikes, collective

bargaining procedures and other "inefficiencies" from jeopardizing export competitiveness, foreign exchange earnings, andcorporate profits, whether foreign or domestic.

The non-worker backgrounds of manyleaders, long terms of office, corrupt connectionswith government officials and ruling party politicians, and incestuous relationships with management were so pronounced that rank and file dissatisfaction with union leadership exploded after

the assassination of president Park in 1979.

Another practice that Korea has appropriated from theJapanese experience is reliance upon giant general tradingcompanies (GTCs or chonghap sangsa in Korean) to lead theexport surge to realize maximum efficiency in penetrating andexploiting overseas markets. These GTCs are usuaIly theoverseas marketing arms of the giant business and industrialgroups (chaebOL) which dominate Korea's domestic economy.These chaebOL, and the men who own them (only recently has

the government pressured them towards becoming joint-stockoperations), have risen to great wealth and prominence withthe success of export-led industrialization. They are the shocktroops of the export drive and the titans of the domestic businesssector. In 1981 the annual turnover of the top thirty groups

16. Korea Herald, February 6, 1983. p. 317. Ibid.18. R. Edward- Eamest Johnston, A Survey of Foreign Investment Climate inKorea (Seoul: Korea Traders Association, 1982).19. Far Eastern Economic Review, November 12, 1982, p. 40.

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accounted for 60 percent of total GNP; Hyundai led with 8.2percent, Sunkyong was next with 7.4 percent, and Samsungwas third with 5.7 percene o In the same year, the top 3.4percent of business enterprises accounted for 68. I percent oftotal sales whereas the combined sales of the 31 ,465small-medium enterprises, which represented 96.6 percent oftotal businesses, was only 31.9 percent, 21 The share of totalexports accruing to Korean GTCs was 43 percent in 1981, 58percent in 1982, and 52 percent in 1983. 22

Political Consequences for Industrial Labor

Organized industrial labor is viewed by the state as apotential threat to the continued success of economic growthand to national solidarity in the face of the perceived militarythreat from North Korea. Mechanisms for structuring andmanipulating industrial workers for state purposes are,therefore, reflected quite clearly in the various labor laws. Theprinciple laws affecting the industrial labor movement are theLabor Union Law, the Labor Dispute Adjustment Law, theLabor Committee Law, the Labor Standard Law and theLabor-Management Council Law. 23

The Labor Union Law is important for three reasons. First ,it is through this law that the unions are rendered dependentupon the state for legal recognition and the right to formallyrepresent worker interests. The government reserves the rightto remove the leadership of any union or decertify any union"when a union violates the law or an order concerning laboror is considered likely to harm public benefits."24 The activistgarment workers union at the sprawling Peace Market(Pyunghwa Sijang) located in the East Gate area of Seoul wasdissolved because the government objected to the role playedby the Urban Industrial Mission-a pro-union, Christianorganization-in its founding and operations. Likewise, in1980 the government intervened to remove and eventuallyimprison officers of the local mine workers union following arampage by hundreds of angry miners in the town of Sabuk inKangwon province's coal mining region. The miners in thetown, located about two hours East of Seoul, became enragedover what they considered to be a "sweetheart" contractnegotiated between a corrupt union president and the mineowners. I t took the government several days to restore orderin the town.

Second, this law prevents unions from forming, cooperating with or contributing money to any political party. A LaborParty is therefore technically impossible. By way of contrast,employer organizations, such as the Federation of KoreanIndustries, the Korea Traders Association, and the KoreanChamber of Commerce and Industry are encouraged, if notcompelled, to contribute large sums of money to politicalparties (especially to "government" parties such as theDemocratic Republican Party under Park and now theDemocratic Justice Party under Chun), as are all private

20. Korea Herald, October 21, 1982. p. 6.21. Korea Times, September 13, 1981. p. 7.22. Korea Herald. February 6. 1983. op. cit. and Korea Herald. January 7.1984. p. 6.23. Ministry of Labor. Labor Laws of Korea (Seoul: MOL, 1981).24. Ibid. p. 22.

businesses of any size. The impact of this law is to splitindustrial unions from opposition political parties and leaveonly government sanctioned institutions-the Ministry ofLabor, the various labor committees, and the labor-managementcouncil system-as vehicles for the representation of workerinterests.

Third, the law has altered the organization of the unionsystem from one based upon the West German model ofnational-level, industrial federations to one based uponindividual local unions at the plant or enterprise level. Manyunion officials have expressed the opinion that this lawseriously damages the power and solidarity of the unionmovement, for now rather poorly educated and inexperiencedlocal-level union officers must confront more skilled management representatives without the aid of professional negotiatorsfrom the national federations (San Byul No Cho). There is nolonger industry-wide contract negotiating between representatives of the manufacturer's associations ofthe various industriesand union federations, as was usually the case before the Chunregime revised the law.

For example, it had become the practice of the Federation

of Korean Textile Workers Unions to bargain in the Springwith the Korea Spinners' Association for industry-wide wagesettlements but, with the revision of the law in late 1980, eachunion local had to bargain separately with their respective plantmanagements. The result was that negotiations dragged on formonths and many contracts were not settled until late Summeror early Fall of 1981.

With all collective bargaining carried out by the unionlocals, the national federations and the umbrella Federation ofKorean Trade Unions (FKTU or No Chong) have been renderedimpotent as organizers of worker interests. The labor movementhas lost potentially powerful and useful institutional bases forclass solidarity and input into the policy processes ofthe state.

Before the revision of the labor laws in 1980, the national

federations and the FKTU often served to mobilize andmanipulate industrial workers within a framework ofsanctioned, coopted and ineffectual activities. The organizationof worker interests within such institutions had the dualadvantages for the regime of regulating union activities whileprojecting an image of support for a modem, albeit paternal,system of labor organization. One student of Korea' s industrialrelations has noted that the FK.TU tended to be

a symbol of potential union power in society and politics ...largely a prestige image for the few unionists who have made itto the top. Likewise. one may find traces that the Federation alsofunctions as a channel through which potential control from abovecan maintain paternal direction over the largest single organizationin society. 25

In addition, abuse of office by union officials has been areal problem at all levels, but especially within the FKTU andnational federations.'" The non-worker backgrounds of manyleaders, long terms of office, corrupt connections with

25. Park Young-ki, Labor and Industrial Relations in Korea: System andPractice (Seoul: Institute for Labor and Management. Sogang University Press,1979). p. 50.26. Cho Suk-choon. "The Korean Labor Union Organizations and theAdministration of Labor Affairs," in the Korean Journal of PublicAdministration, vol. 20. no. 2, 1982.

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government officials and ruling party politicians, and incestuousrelationships with management were so pronounced that rankand file dissatisfaction with union leadership exploded after theassassination of president Park in 1979. 27

With the imposition of martial law in May 1980, thousandsof union members, both officers and rank and file, were purgedfrom their organizations. This included senior officers of theFKTU and most of the presidents of the then 16 nationalfederations. The most activist and independent officers weresent to rectification camps operated by the military where theirthinking was purified by liberal doses of calisthenics. One suchman, the ex-president of a Seoul chemical workers local, statedthat "The government always says that we are communists justbecause we try to get our rights. We're not communists. Wedon't have any sympathy for North Korea. All we want isjustice and the chance to live a decent life. "2 8 He, and otherslike him, are barred from holding union office in the future.Those who cooperate with the state, however, may benefithandsomely. For instance, the president of the FKTU at thetime of the military's coup d'etat, Chung Han-joo, waspromoted eventually to the position of Minister of Labor.

Labor disputes not settled through thesanctioned committee system are often handledby more formidable institutions for inducingcompliance like the National Police, the Agencyfor National Security Planning (ANSPformally the Korean Central IntelligenceAgency, KCIA), as well as thugs hired by themanagement to intimidate workers.

The revisions of the Labor Union Law by the Chun regimewhich have reduced the role of the FKTU and the nationalfederations indicate a certain ambivalence over the utility ofthese organizations as vehicles for controlling or coopting theindustrial labor movement. At the close of the Park era theseorganizations were increasingly the targets of constituentdissatisfaction. During the short five-month interval betweenthe collapse of the Park regime and the assumption of powerby the Chun government, it seemed as if reform-minded leadersclose to the rank and file might be able to take over the FKTUand most, if not all, of the 16 national federations. In the handsof leaders responsive to the interests and demands of theirmemberships, these federations could have been crucial inmobilizing labor's support behind a new politics in SouthKorea. For example, their support of the New Democratic Party(NDP) and such opposition leaders as Kim Dae-jung or KimYoung-sam (which seems likely) could have helped to dissolvethe bureaucratic-authoritarian system in favor of somethingmore progressive and democratically open. The Chun govern

ment therefore seems content to leave these national Federationsin limbo for the time being, neither strengthened nor abolished.They are capable of being resuscitated if found necessary forfuture purposes.

The Labor Dispute Adjustment Law essentially makes theworker's ultimate weapon-the strike-illegal, and prescribeslengthy procedures for government conciliation and mediationof disputes. These procedures make it very time-consumingand costly for workers to down tools. Its most recent revisionprohibits interference by third parties in union affairs. The lawstates that "persons other than an employee who has actualemployment relations with the employer, or persons other thanhaving legitimate authority under law, shall not engage in anact of interference, in a dispute, for the purpose ofmanipUlating, instigating, or any other act to influence theparties concerned. "2 9 This prohibits linkages between workersand student groups or activist church organizations like theUrban Industrial Mission or the Young Christian Workers.

Such a prohibition reflects the government's effort tostamp out the influence of activist Christian groups, especiallythe UIM. It represents yet another example of the state's effortsto isolate labor interests by prohibiting the formation ofcoalitions that cut across the fabric of Korean society. Havingisolated as well weakened organized labor, the state has goneon to create avenues through which labor interests must bechanneled. The representation of worker interests thus becomesdependent upon the largesse of institutions created andmanipulated by the state.

The Labor Committee Law and the Labor-ManagementCouncil Law promote the cooptation of labor interests intomechanisms controlled by the state. The Labor Committee Lawestablishes a hierarchical series of provincial and special-city(Seoul, Pusan, and Taegu) committees subordinate to a nationalcommittee in the nation's capital. These are "tripartite" panelswith equal numbers of representatives from management,

labor, and the public interest (that is, the government). Theyprovide a venue for the conciliation or mediation of labordisputes which cannot be settled through plant-level negotiations. Obviously, the crucial swing vote is exercised by theso-called public-interest representatives appointed by thegovernment. While the rulings of these committees sometimessupport the union's position, the important point is the degreeto which the unions are dependent upon the goodwill of thegovernment for the advancement of their interests.

Labor disputes not settled through the sanctioned committee system are often handled by more f o r m ~ d a b l einstitutionsfor inducing compliance like the National Police, the Agencyfor National Security Planning (ANSP-formally the KoreanCentral Intelligence Agency, KCIA), as well as thugs hired by

the management to intimidate workers. Official statisticsconcerning labor disputes purport to show that such incidentshave declined with the revision of the law-from 407 in 1980,to 186 in 1981, to only 57 in 1982.30 These figures are suspect,for on October 3, 1980 the Korea Times reported that 897 labordisputes had occurred in the first five months of 1980 alone,more than twice the 427 recorded in all of 1979. 3 ' Many people

29. MOL, lAbor lAws of Korea, op. cit. p. 35.27. Korea Times, May 10 & 14, 1980. 30. The Far Eastern Economic Review, October 29, 1982, p. 17.28. Personal interview with union activist in Seoul, July 1981. 31. Korea Times, October 3, 1980, p. 6.

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knowledgeable about labor affairs in South Korea admit thatdisputes, including illegal strikes, often go unreported andunrecorded in the controlled media and official publications.One officer at a government-funded labor welfare agencyadmitted that "there are dozens of strikes going on right now[early 1981] that you will never hear about because thegovernment doesn't want you to."32

Sanctions directed against unionists who defy governmentrestrictions are often harsh. In 1978 four union officialsincluding a vice-president and a general secretary of the textileworkers national federation were arrested and jailed followingdemonstrations at the Kukje Weaving Company protestingunfair labor practices and the rigging of local union elections.In August 1979, a public demonstration and sit-in by womenworkers of the Y. H. Company, an exporter of wigs, was brokenup by police, resulting in many injuries, the jailing of severalof the young women, and the death of another. This incidentcontributed greatly to student and worker protests whichculminated in the downfall of the Park regime later that year.In April 1980, the estimated 3500 coal miners at Sabuk,Kangwon province, angered by the sweetheart contract

negotiated by their local president rioted and took over thetown for several days. The leaders of the takeover were arrestedandja iled. Within weeks, the military declared martial law andthe interim government of president Choi Kyu-ha wasoverthrown.

In August 1980, the newly installed Chun regime purgedthe presidents of 11 of the national federations as well as anFKTU vice-president on charges of corruption and replacedthem with handpicked successors. In February 1981, 11garment workers from the Peace Market (Pyunghwa Sijang)complex in Seoul were arrested and jailed for staging an illegalsit-in demonstration at the offices of the Asian-American FreeLabor Institute (an AFL-CIO funded group) to protests thegovernment's decertification of their union. 33 In 1982 jo b

actions against both the foreign-owned Control Data/KoreaCompany and the domestically-owned Wounpoong IndustrialCompany resulted in the dismissal, beating, and arrest ofhundreds of male and female workers. In the ControlDatalKorea case The Far Eastern Economic Review noted that"the government does not want trade unionism to be a factorwhich could discourage future foreign investors."34 ControlData closed its operation in Korea. In the Wounpoong caseabout 650 workers, mostly female, were staging a sit-in toprotest against layoffs and the mistreatment of women unionofficers by company-hired thugs. According to one source,

At 6 p.m. on the third day, plain-clothes policemen were sent inon the pretext of evacuating those workers who had collapsed.About 250 workers were dragged out of the factory. Fifty-eightof them were taken to a hospital with injuries incurred during theconfrontation, which took place while uniformed police stood by.The next day the remaining workers were forced ou t by tear gas. 35

Examples of management and government collusion in such

32. Personal interview with an official of the Korea Labor Welfare Corporationin Seoul, November 980.33. Korea Times, February 6, 1981, p. 8.34. Far Eastern Economic Review, October 29, 1982, op. cit.35. Ibid.

disciplining of labor unions are legion.The most controversial piece of legislation controlling or

manipulating industrial labor is the new Labor-ManagementCouncil Law, which requires all places of business to establishcouncils made up of an equal number of representatives fromlabor and management. The stated goal is to "seek peace inindustry and make a contribution to the development of thenational economy" through cooperation and understandingbetween employer and employee. 36 Such councils, located ineach plant, are to confer on all matters except wages, butunionists are suspicious that they will not limit themselves tonon-wage matters. Critics charge that the councils are reallyintended to supplant the unions where they already exist andinhibit their founding in plants without unions. It should benoted that most of the big chaebOL firms are not unionized.

The council system fits in nicely with elite notions ofproper labor-management relations. Recently, the head of theKorea Chamber of Commerce and Industry was quoted assaying, "In Korean management, superiors strive to be fair andgood to their subordinates while subordinates express loyaltyto their superiors regardless of reward. . . . This implies that

the ties between management and labor are like familyrelationships, not so-called 'labor contracts.' "3 7 And inFebruary 1983, the Minister of Labor addressed a joint meetingof union and management officials at which he

told the meeting that productive and cooperative labor-managementrelations should become the driving force for the country's secondeconomic take-off and the foundation for a "great, advancedKorea." The nation's chief policymaker in labor affairs said thatboth labor and management should fulfill their responsibility beforeadvocating their rights. "Mutual trust and respect should becomethe basis for cooperative .. . relations. Productive labor-management relations will be helpful not only for the individualdevelopment but also for the prosperity of the nation as a whole. "3 8

Management that conceives of its employees as its subordinate

children is unlikely to treat them as legitimate equals at thecouncil table. Likewise, a government that values responsibilityover rights is unlikely to allow the council system to tilt toomuch in favor of worker interests if that is seen as jeopardizingthe competitiveness of Korean exports and the economicsuccess of the nation as a whole. In addition, workers awareof the government's disposition toward cooperation andstability as well as government propensities to intervene onbehalf of management interests are unlikely to believe that theycan effectively achieve their goals through the council system.

Following the revision of the labor laws in 1980, unionmembership dropped precipitously from a peak of 1,119,572as of July 1980, to 922,317 by the end of February 1 9 8 1 - adecline of over 197,000 members or 17 percent. Federationslosing the most membership were the Automobile andTransport Workers (80,000), the Seamens' (54,000), and theChemical Workers ( 13,000).39 Since many firms in these

36. MOL, Labor Laws of Korea, op. cit. p. 5.37. Korea Herald, January 13, 1983. p. S.38. Korea Herald, February I, 1983. p. 3.39. Federation of Korean Trade Unions, Activities Report: 1980 (&lop Pogo:1980), (Seoul: FKTU, 1981) p. 316; and FKTU, "Outline of the FKTU," anunpublished briefing document (May 28, 1981).

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industries are small, enterprise-level unions are essentiallyunworkable. In a context where small unions are prohibitedfrom negotiating industry-wide contracts, union membershipcarries with it few benefits.

This decline also reflects a profound demoralization ofunion memberships that accompanied the implementation ofthe Chun regime's labor policies. Most reform-minded and

progressive union officers, as well as rank and file members,felt frustrated and disillusioned. Many dedicated and earnestpeople have left the unions and many who remain canaccomplish little without cultivating the goodwill of bureaucrats, the security agencies, and the politicians of the rulingDemocratic Justice Party.

Many outside of the formal union movement, those inreligious or student organizations, are also discouraged by thecurrent situation. One long-time Korea resident and laboradvocate recently told me, "With the crack-down at theWounpoong plant, the government has destroyed the lastindependent union in Korea."4O I f that is so, then thesuppression of organized industrial labor is virtually complete.

Material ConsequencesLarge and rapid increases in GNP have been accompanied

by growing inequality in the distribution of income. Table 1displays the slippage of the GINI index during the period ofmost dramatic GNP growth and increase in the industrialworkforce-1965-1980. In fact, the GINI index probably

Table 1

Distribution of Household Income, 1965-1980

Income Group 1965 1970 1976 1980Bottom 40% 19.34 19.63 16.85 16.06Top 20% 41.81 41.62 45.34 45.39

GINIIndex .344 .332 .381 .389

Sources: Choo, Hakchung and Kim, Daemo, "Probable Size Distribution ofIncome in Korea: Over Time and by Sectors" (Seoul: Korea Development Institute, 1978) for 1965-1976 data; Economic Planning Board,SociallndicatorsofKorea, 1981. (Seoul: EPB, 1981) for 1980data.

understates the unequal distribution of income and wealth sincegovernment statistics omit wealthy households" and it isgenerally perceived that corporate incomes are higher thanreported and that profits from real estate speculation andkerb-market lending usually evade recording and taxation. Theprofits from this often illegal and therefore "hidden" economy

40. Personal correspondence with foreign-resident labor activist in Seoul,December 1982.

accrue primarily to the upper and middle classes, skewing thede facto distribution of wealth heavily in their favor. The ChangYoung-ja scandal involving over $900 million in kerb-marketloans to several large corporations in 1982 and the controversiessurrounding the troubles of the Myungsung and Hyosungbusiness groups in 1983 are indicative of the significance ofthis hidden economy. It has been estimated that the kerb-marketaccounts for as much as 33 percent of total commercial loansin the Korean economy. In short, there "is evidence that SouthKorean society is becoming more unequal. As company profitshave increased during the 1970s, those in the higher levels ofbusiness appear to have benefited disproportionately. "4 2

Such growing inequality has not gone unnoticed byworkers. One unionist noted that as workers "witnessed therapid industrial development of the nation during the 1970s,their endurance came to an end. A quiet change of opinionspread among laborers: poverty is not our destiny and societyshould be held responsible for it. "4 3 She went on to say,

now was the time when balanced distribution of wealth betweenemployers and employees should be carried out in all fairness amidsocial efforts to erase the absurdities of the past. Over the last

decade, industries were one-sidedly encouraged with variousadministrative favors by the government while laborers were forcedto reserve their right for the economic development of the nation. 44

Shortly after this statement appeared in the press, the militaryseized power and subsequent censorship prohibited thecirculation of such opinions. And while the Chun regimeevinces greater interest in promoting growth with equity, anoted economist with an intimate knowledge of Koreaneconomic and social affairs has posited that such incrementalattempts at redistribution probably will not work without basicstructural change in the political economy. 45

In 1980, the International Labor Organization (ILO) foundthat Koreans worked the longest hours per week of any nationsurveyed-men employed in industry 52.8 hours and women53.5. 46 Yet, a study by Sogang University's Institute for Laborand Management found that "80% of wage earners are belowthe tax exemption point. Even according to a KoreaDevelopment Institute [KDI] survey, in 1980 the [monthly]minimum cost of living [for a family of five] was 270,000won, while 30% of wage earners received less than 70,000won, 56.1 % less than 200,000 won."47 Controlling for inflation(23.3 percent in 1981 and 6 percent in 1982), KDI estimatedthat the minimum income necessary for a family of five wouldrise to 355,000 won, but the statistics ofthe Ministry of Laborshow that the average monthly income of the industrial workerstood at 245,981 as of March 1983. 48 The FKTU conductedits own survey in 1982 and reported that the minimum necessaryincome for a family of 4.4 members was 431,130 won, while

42. South magazine, October, 1982. p. 29.43. Korea Times, April 30, 1980, p. 3.44. Ibid.45. Irma Adelman and Sherman Robinson, Income Distribution Policy inDeveloping Countries: The Case of Korea (Stanford: Stanford University Press,1978).46. Hankook llbo (Hawaii Edition), February 4, 1982. p. 1.

41. Choi Sung-iI, "South Korea Under Park Chung Hee: Development or 47. Lee Kyu-chang, Survey and Analysis of Collective Bargaining AgreementsDecay?" a review essay in the Bulletin of Concerned Asian Scholars, Vol. (Seoul: Sogang University Press, 1980). p. 103.15, No.2, 1983, p. 71. 48. Korea Herald, December 14, 1982, p. 3, and March 22, 1983, p. 5.

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the average wages paid to its membership was 247,759 won. 49In February 1983, the Korea Herald quoted figures from a1981 KDI-Economic Planning Board survey stating thatwages paid to workers in the manufacturing sector averaged209,641, the lowest of any economic sector. After 20 years ofthe economic miracle and the doubling of real industrialincomes, the average worker cannot support a family on a

single income.

Table 2

Average Monthly Wage inSelected Industries-1980

WagesIndustry (inwon)* Days Hours

Coal Mining 215,480 24.6 175.1Textiles 121,193 25.6 239.7Wearing Apparel 97,489 24.0 242.6Wood Products 142,732 24.7 235.4Chemicals 174,932 24.8 228.7Iron & Steel 203,130 25.2 239.5Machinery 180,274 24.1 221.2

* (630 won=$1)Source: Ministry of Labor. Yearbook of Labor Statistics. 1981 (Seoul: MOL.

1981), pp. 135-160.

This is not because the Korean worker is unproductive.When increases in labor productivity are compared to increasesin real wages, labor productivity between 1971 and 1981 roseat the average annual rate of II . 12 percent while real wagesrose at a rate of 7.81 percent. Even during the recession of1980-81, a period when real wages fell, labor productivityrecorded impressive gains. 50 In order to promote corporateprofitability, wage increases have been systematically held farbelow productivity increases. I t is also noteworthy that at atime of rapid wage increases, Korea's export surge wascontinuing unabated. This suggests that rising wages in and ofthemselves do not necessarily damage export performance so

muchas

the profit margins of Korean firms (often notoriouslyslim). Wage suppression allows greater accumulation ofsurplus profits to accrue to management, which may thenreinvest in plant expansion, payout dividends, or "donate"large sums to the Democratic Justice Party or the nationalgovernment for defense or public interest programs. Suchallocations are more in line with the goals of the bureaucraticauthoritarian state than the enrichment of the working class.

Table 3

Comparative Increase in Labor Productivity and Real Wages, 1971-1981

Year Labor Productivity Real Wages

1971 9.7 2.41972 8.7 2.01973 8.8 14.31974 11.4 8.81975 11.6 1.41976 7.5 16.81977 10.4 21.51978 12.0 17.41979 15.8 8.41980 10.7 -4 .7

1981 15.8 -2 .6Source: Economic Planning Board, Major Statistics of Korean Economy. 1982

(Seoul: EPB. 1982). p. 175.

Wage increases have been tempered by the effects ofinflation. Inflation averaged II . 2 percent between 1968 and1973, 18.5 percent between 1974 and 1980, 23 percent in1981, and 6 percent in 1982. 51 The projected inflation rate for1983 was between 8- 10 percent, while wage increases were

officially held to around 6 percent. While wages have trailedinflation, they can of course at times contribute to it. In theKorean case, high rates of inflation have been more a productof increased factor and commodity prices for imports, inflationin the advanced industrial countries, and the Korean government's overstimulation of growth, than rising labor costs.

State policies toward industrial labor also sustain, if notaggravate, traditional inequalities in Korean society. Oneexample is the wage disparity between male and female workersin the manufacturing sector-a disparity that mirrors economicinequalities across the whole of Korean society. Womencomprise about 50 percent of the industrial workforce and oftenaccount for a much higher percentage in certain industries(textiles, electronics, and chemicals) as well as in certain

geographic locations (for example, the Kuro and Kumiindustrial estates) where they may constitute 70 percent or moreof the workforce. These mostly young female workers tend tobe paid far less than their male counterparts. In 1978, a yearwhen the average wage in the manufacturing sector was 88,000won per month, a survey of women workers at the Kuro and

umi industrial estates (the two largest in Korea) found theaverage woman worker's wage to be 55,906 won, an amountcorresponding to just 57 percent of the average worker's

49. Hankook llbo (Hawaii edition). February 16. 1983. p. 1.50. EPB. Major Statistics. op. cit. p. 175. 51. Far Eastern Economic Review. December 10. 1982. p. 68.

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monthly household income for 1978. 52 The surveyor's conclusion was that "female labor takes on the characteristics ofshort-term economic activity of a family income complementary nature. At the present level of their wages, there is noway their family financial needs can be met. "5 3

Yet, it is precisely these women who are crucial to thecountry's export-led development strategy. Fortune magazinerecently noted that as Korea moves to challenge Japan'sposition in international trade,

The competition should be interesting, pitting advanced technologyagainst low wages. By Japanese standards Korean productionmethods are primitive. At Matsushita's three-year old VCR [videorecorder] plant in Osaka, robots do 80% of the work. At Samsung'sVCR plant in Suwon, only three months old, the work is done byyoung women whose small incomes are supplemented by [U.S.]ten-cent meals at the company cafeteria and free lodging in thecompany dormitories.

Whether Samsung's women can outperform Matsushita'srobots will depend largely on Samsung's ability to keep their wagesin check."

Holding wages in check is all too often done by the bustingof unions at such places as the Peace Market, Wounpoong,and Control Data/Korea, where the memberships are overwhelmingly female. It should also be noted that it has beenthese young women workers who have led the labormovement's struggle against exploitation in Korea. The Y.H.,Control Data/Korea, and Wounpoong incidents all verify thisphenomenon.

Sadly enough, many Koreans call these young womenwho are in manufacturing industries "Kong Soonie." (Soonieis a common name amongst country girls and "Kong" is derivedform the Sino-Korean character for labor; in other words"Soonie the Worker" - a Korean version of America's "Rosiethe Riveter.") This term reflects the rural peasant origins ofmost of these young women as well as the fact that most of

Korean society looks down upon them. This is unfair and ironicin that it is these women who are, in great part, responsiblefor the Korean economic miracle.

The material consequences of the Korean model ofdevelopment thus appear to be increased ineqUality of incomeand wealth in addition to artificially low incomes for industrialworkers. What improvement for workers has occurred has beenmore the result of government largesse at times of high inflationthan of the organized power of working-class organizationssuch as unions. The unions' subordination to and dependencyupon the state result in both political and economic disadvantages for Korean workers.

Conclusion

Understanding the role of the state and the context withinwhich policy is made contributes toward a realization of why

52. Un Cho and Hagen Koo, "Economic Development and Women's Workin a Newly Industrializing Country: The Case of Korea," in Development andChange, Vol. 14, 1983; and Sun Joo Oh, "The Living Conditions of FemaleWorkers in Korea: Centering Around the Kuro and Kumi IndustrialComplexes," in Korea Observer, Vol. XIV, No.2, Summer, 1982. p. 194.53. Sun Joo Oh, op. cit.54. Lee Smith, "Korea's Challenge to Japan," in Fortune, February 6, 1984.p.I04.

certain policies have certain consequences for specific classesin Korean society. In Korea the policy process is not an openone and the labor policy has always been particularly sensitiveand closed. The heavy controls placed upon labor and unionsby the emergency decrees of the Park regime have been revisedand strengthened under Chun's Fifth Republic. This revisionwas carried out under the auspices of a special committee ofthe Legislative Council, a hand-picked body of societal"representatives" which succeeded the military-dominatedSpecial Committee for National Security Matters (SCNSM orKuk Po Oui) in 1980. This committee was charged withrevising the labor laws, but its five members consisted of aneconomics professor (a former Park-appointed congressman),the president of the FKTU (afterward appointed Minister ofLabor by president Chun), a provincial newspaper publisher,an official of the Sungkyunkwan (a Confucian studiesinstitution affiliated with the Samsung industrial group), and aformer committee . chairman of the SCNSM. In reality thiscommittee merely approved revisions already worked out bythe technocrats and security advisors of the new president'sstaff in the executive mansion. The special committee and theLegislative Council did not so much make policy as lend anaura of legitimacy and an illusion of societal input to policiesoriginating at the highest levels of the new regime.

All of the "legislation" produced by the Legislative councilwas put into effect before the new National Assembly waselected in 1981. And the new legislators were prohibited fromrejecting any of the laws produced by the Legislative Council.Such was the process that produced the current laws.

Not all of the problems of the industrial labor movementcan be attributed to non-labor sources. One labor activist oncetold me that "the problem with the labor union movement isthe unions themselves. "5 5 He was referring to the co-opted,corrupt and ill-advised ways in which organized industrial laborhas tended to operate in recent times. He may have been

blaming the victim in this case, for the problem lies not somuch in what the unions have made of themselves, but whatthe state has made of the unions. The state has, through itspolicy of repression and manipulation, produced the kind ofsystem that it desires-one which is disciplined and productivewithout endangering stability, social order, and the nationalsecurity.

The state elites believe that a free and independent labormovement would constitute a threat to the established socialorder. They are probably correct, for as long as it remainsrepressed and frustrated it will continue-as the events of1979-80 have demonstrated-to be a volatile force in Koreansociety. But this will be because of the state's policies, not inspite of them.

*

55. Personal interview with labor union activist in Seoul, August 1981.

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THIRD WORLD CHALLENGE TO PSYCHIATRYCULTURE ACCOMODATION AND MENTAL HEALTH CARE

Howard N. Higginbotham Culture Learning Insti tute/East- West Center Are Western therapeutic methods sufficiently sensitive to These and ot her questions are answered in this comprehenAsian cultures? Do socioeconomic barriers limit the feasi sive study of the mental health systems of Taiwan, Thaibility of psychiatry's full development in Southeast Asia? land, and t he Philippines. $25.00, paper

ETHICS, POLITICS, AND INTERNATIONAL SOCIAL SCIENCE RESEARCH

FROM CRITIQUE TO PRAXIS Michael P. Hamnett, Amarj it Singh, Douglas]. Porter, and Krishna Kumar

Culture Learning Institute/East-- West Center This pioneer study examines the process and ethics of authors explore an alternative approach that is integrativecross-national social-science research, especially as it in and consistent through all levels of concern-ideological,

volves scholars from Western industrialized countries and theoretical, and practical. $15.00, papertheir collaborators and subjects from the Third World. The

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Productivity First: Japanese Management Methods in Singapore

by Vivian Lin

IntroductionNational development strategies in many Third-World

countries in recent years have tended to emphasize a numberof Japanese-pioneered patterns, among them managementmethods and export-oriented industrialization. Both have beenseen as crucial to Japan's rise as an industrial power; and,during the past decade, export-oriented industrialization hasbeen behind the rise of the Asian "Gang of Four"-South

Korea, Hong Kong, Taiwan, and Singapore.The recent surge of interest in the theory and practice of

Japanese management comes from all comers of the capitalistworld: corporations aiming for higher productivity, labor wishing for life-time job security, governments interested in consultative processes, radicals advocating greater workplace participation, and liberals desiring more enlightened corporations.Several academic and popular works on Japanese managementhave all become paper-back best-sellers.'

Admiration for Japanese management methods, which areoften viewed as a coherent if not monolithic system, exists fora variety of reasons. The job security conferred by life-timeemployment is often cited, as is the company loyalty that thisapparently produces. Furthermore, the conventional wisdom is

that Japan has become a strong competitor with other advancedindustrialized countries largely because of high productivityand better product quality produced by Japanese managementmethods. In short, those management methods have been responsible for Japan's post-war economic "miracle." Manycountries, both industrialized and developing, are promotingJapanese management methods as a central element in national

I. See, for instance, Theory Z by William Ouchi and The Art of JapaneseManagement by Richard Pascale and Anthony Athos.

development strategies. 2Japanese management methods and export-oriented indus

trialization (EO!) together are seen by governments and international organizations as a model of national development thatbenefits governments, corporations, and workers. However,the supposed worker welfare orientation of the Japanese management system, either in Japan or within the context of EOI,

is not universally accepted. 3

2. Hideo Inohara, "Japanese Personnel Management in Europe," Euro-AsiaBusiness Review, 2, 2, 1983, pp. 7-10.3. Controversy around Japanese management theory has been largely directedat its appropriateness for other cultures. The recent survey in Euro-AsiaBusiness Review exemplifies the discussion on the cultural conflicts of Japanesefirms operating in western countries. [Hideo Inohara, op. cit. I However,detailed critical studies in the English language on how the workers withinthat system fare are still limited, especially with regards to the impact onworkers' health. Anecdotal evidence ["Report on the Japanese 'Miracle':Working Conditions of the Toyota Factory ," International Journal o f HealthServices, 11,3,1981, pp. 471-472; Tse, Christina, Letters to a Friend, Centre

for the Progress of Peoples, Hong Kong, 1982] has shown that workplacepaternalism in Japan is highly authoritarian and controlling, that participationis a myth, and that workers are under constant, if subtle, pressure to performand produce to their physical and mental limits. Personal accounts fromJapanese workers reveal the harassment and pressure by management andunion officials that lie behind the apparently harmonious relationship. Theseaccounts also show the dehumanization of labor under conditions of highefficiency and rationalization in production. [Azuma Yoshiji, "NissanWorker's Diary: The Kangaroo Courts," AMPO, 13, 2, 1981, pp. 52-55;Yamaka Junko, "Beyond Despair: One Autoworker's Season in Hell," AMPO,13, I, 1981, pp. 54-59.) One seminal study on the labor process in Japanesefirms shows that, in fact, the system is bureaucratic and hierarchical, withwomen wage laborers firmly at the bottom. [Wendy Smith, "The Impact ofJapanese Foreign Investment and Management Style on Women IndustrialWorkers in Malaysia," paper presented at Conference on Women in the Urbanand Industrial Workers in Malaysia," paper presented at Conference on Women

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In this article Japanese management methods used in aJapanese assembly finn in Singapore are examined in tenns oftheir impact on workers' well-being. specifically their health.The relationship between management methods and health isstudied in the context of a country which is not only an examplepar excellence of export-oriented industrialization but also onethat is a leading proponent of Japanese management strategies.

It might be expected that health would be accorded a highpriority in any system that claims to place emphasis on workerwelfare. for health is fundamental not only to well-being butalso to productivity. The health of the workforce and the occupational health practices at the workplace. then, provide insightsinto the reality of a management system, as well as into thelarger socio-economic structure of society. The presentexploratory study seeks to provide such insights and to stimulatefurther research. 4

This study looks at the off-shore TV assembly plant inSingapore of one Japanese electronics company. The datacomes from responses to a structured, close-ended survey questionnaire of a 20 percent snowball sample ofthe 130 productionworkers at the plant. S In-depth interviews were also conducted

with workers regarding management practices as well as healthand safety conditions and concerns. The survey was bilingual(English/Chinese, English/Malay) and included questions onsociodemographic characteristics, workplace environment, jobdesign, health services utilization and preferences, symptomaticcomplaintS (both physical and psychological), and lifestyles.Nearly all questions were factual. Workers completed the survey in their own time.

Due to the nature of the sampling and the fact that onlyone finn in the industry was surveyed, the study can be nomore than exploratory. 6 Although the results discussed here

in the Urban and Industrial Workforce in Asia. Manila. 1982.] Anothercollection of articles has shown that life and work in life in Japan are far fromthe c1ich6s of groupism and lifetime employment. [David Plath, (ed.>, Workand Lifecourse in Japan, SUNY Press, Albany, 1983.] Empirical studies ofthe true impact of these management strategies in Japan are limited, to saynothing of the effects of their transplantation to other areas.4. Recent studies on the health effects of social networks [L.F. Berkman andS.L. Syme, "Social Networks, Host Resistance, and Mortality: A Nine-YearFollow-Up Study of Alameda County Residents," American Journal ofEpidemiology, 109, 2, 1979; B.H. Kaplan, J. Cassel, and S. Gore, "SocialSupport and Health," Medical Care (Supplement), IS, 5, 1977] and ofunemployment [Harvey Brenner, Estimating the Social Costs of NationalEconomic Policy, U.S. Government Printing Office, Washington, D.C., 1976;S. Cobb and S.V. Kasl, The Consequences of Job Loss, DHEW (NIOSH)Publication No. ;77-224, 1977] seem to suggest that the Japanese management

system may in fact pmrnote health. Yet the critical studies cited above revealthe work environment to be quite stressful as well. In the race for growth andproductivity, accidents are the results of labor intensity rather than carelessness,and ill workers are made to press on with work rather than rest. [YamakaJunko, op. cit.] This study pmvides further empirical evidence relatingill-health to the organization of work.5. The study was initiated after workers from the factory so requested. Thecontact was made at a community center. While the sample pmbably does notinclude those who speak on behalf of management, it is unlikely that thesample is limited to a single clique insofar as the sample covered differentproduction lines, different ethnic groups, as well as 20 percent of the workers.Because the workers were quite unaware of potential occupational hazards, itis, furthermore, unlikely that they would ha ve given answers in a deliberatemanner intended to create findings.6. The author was gathering data on semiconductor workers in Singaporeand Malaysia when the present study was commissioned. Because the

are largely descriptive, the interpretation of the data was aidedby access to several of the tapes of management lectures toworkers. 7 Because of the sensitive nature of the research, itwas not possible to obtain a tour of the plant, interviews withmanagement, or access to company records.

Workers say job stress at Company Z isexperienced in many ways, including productionquotas and factory discipline. Above all else theyidentify as the sources of stress the constant emphasis on productivity, the condescending andpaternalistic attitudes of management, and pressures, both subtle and authoritarian, to conformto desired behavior.

The Context: Export-OrientedIndustrialization in Singapore

International organizations and developing countrieswhich are searching for solutions to the problems of economicdevelopment have given much attention to EO!. 8 It has beenclaimed that the proliferation of labor-intensive factories producing for the world-market in the four Asian "economic miracle" nations is responsible for their growth in GNP, rise instandard of living, decline in infant mortality, and relativelylow unemployment rates. 9 Because of the dominance of theelectronics industry in the manufacturing sectors of those countries, the development of that industry has been promoted asthe centerpiece of any industrialization strategy. Singapore isconsidered to be a prime example of successful EO!.

An island at the tip of the Malaysian peninsula, Singaporewas historically a trading post and was settled by waves ofimmigrants and traders. Its status as an entrepot during Britishcolonial rule meant that. while its commercial and service sectorinfrastructure was well developed, there was very little manufacturing at the time of self-government in 1959. When itbecame an independent city-state in 1965 and the British baseswere closed, the ruling party, People's Action Party (PAP),found itself governing a territory with an unbalanced economicstructure and a politically restless population with an unemploy

manufacturing process is central to occupational health, the other firms (a totalof 900 workers) in the larger study cannot be used in conjunction. Since dataanalysis is not yet complete for the larger study, the present survey mustnecessarily stand alone. While Singapore government has conducted onemorbidity survey in 1977 and publishes annual health statistics, the detailreported here does not ex ist in the national statistics which are at a high levelof aggregation.7. A worker-informant was able to record the weekly lectures given bymanagement to the entire assembly of workers. The tapes made available tothe researcher provides first-hand knowledge of the management process.8. Eddy Lee, (ed.), Export-Led Industrialization and Development, International Labor OrganizationlARTEP, Bangkok, 1981.9. Peter Chen, (ed.>, Singapore Development Policies and Trends, OxfordUniversity Press, Singapore, 1983.

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Table 1

Union Membership an d Work Stoppagesin Singapore, 1962-71

Union Work DaysYear Unions Membership Stoppages Lost

1962 122 189,000 88 165,1001966 108 141,900 14 44,7001971 100 124,350 2 5,500

ment rate of over 10 percent. Realizing that the economy lackednatural resources, the Singaporean leaders embarked upon apolicy of EOI, based on direct foreign investment in labor-intensive industries. From the viewpoint of PAP leaders, the

rationale was simple and logical. Singapore had no hinterlandand few resources besides its people, many of whom wereunemployed workers and politically active. At the same time,Singapore was a long-time free port, with good infrastructureand service facilities. If transnational corporations (TNCs)could be attracted, they would provide instant jobs, access toworld markets, and bring in new technology as well as management know-how. To implement such a strategy successfullyrequired consolidation of political power, which, in tum, meantboth an effective industrial-bureaucratic network and a rangeof social programs.

Central to the industrialization program was the creationof the Economic Development Board, which provided financialand technical services to foreign investors. The Pioneer Indus

tries Ordinance and the Economic Expansion Incentives Actprovided a host of tax holidays and other financial incentivesfor investors. Jurong Town Corporation was set up in 1968 todevelop industrial estates and associated facilities and to operatethe shipyards. The Development Bank of Singapore was setup also in 1968.

Labor was also forced to make its contribution to thefavorable investment climate. Between the amendments to theEmployment and Industrial Relations Act (1968) and activepolitical suppression ("Operation Cold Storage"), the leftleadership and the labor unions were brought under control.The Ministry of Labor statistics, in Table 1, show the declineof the Singapore trade union movement.!O Today, only 20.5percent of the workforce are unionized. There have been no

work stoppages since 1977, when one strike occurred. Wagelevels and raises are now regulated by the National WagesCouncil, a tripartite group.

At the same time, the government embarked upon amassive program of public housing, with the creation of theHousing and Development Board to build and manage newhousing estates of high-rise flats and new towns. The population

was dispersed into these new developments, with deliberatemixing of ethnic groups. The Family Planning and PopulationBoard was set up to promote population control, with a varietyof positive and negative incentives. In addition, an efficient

and reliable bus service was set up. Domestic savings for publicexpenditure were mobilized through the Post Office SavingsBank and through contributions to the Central Provident Fund,a paycheck-deduction scheme for social security.

In terms of social policy, the Singaporean government hasalso played a strong role. Seventy percent of the populationhave been settled in low-rent high-rise flats, public transportation is inexpensive and convenient, and hospitals are heavilysubsidized. To prevent population growth among the lowersocioeconomic strata, a variety of negative incentives havebeen introduced, including compulsory sterilization after twochildren for any "foreign guest workers"!! making less than$1,000 (US $450) per month who marry Singaporeans afterworking for less than five years. Employers of "foreign guest

workers" are required to send their employees for semi-annualblood and urine tests for venereal disease and pregnancy.Occupational health has recently come to government attentionsince productivity losses due to accidents and illnesses can bequite costly. Mandatory training courses have been institutedfor certifying factory safety officers and for doctors who arecontracted by factory management to perform medicalexaminations of workers. Having successfully reduced infantand maternal mortality rates and the prevalence of infectiousdiseases, the Singaporean government has now turned activelytoward combating rising health care costs, chronic diseases,and occupational injuries.

The industrialization strategy adopted by Singaporecoincided with the time of rapid expansion of TNCs and the

competition among TNCs for offshore manufacturing locations.A host of tax holidays and other incentives, plus low wagecosts, proved attractive for transnational corporations seekingnew locations for their manufacturing operations. Throughoutthe 1970s, large amounts of foreign investment-primarilyfrom the U.S., Japan, and EEC-based companies-f lowed intoSingapore.

11. Singapore has historically been a destination for migrant labor. Under10. All statistics used in the paper come from official government publications, British colonialism, Chinese and Indian workers were brought in undermostly from the Yearbook of Statistics. The national health statistics are from contract. Today, Malaysians and other Southeast Asian workers are alsothe last National Health Survey conducted in 1978. allowed in on two-year renewable contracts, as "foreign guest workers."

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Light industries were located near housing estates, in thehope that women would be drawn into the manufacturing sectorin large numbers. Such a strategy proved successful. By 1974,the workforce was concentrated in three low-skill industries:( l) electronics assembly plants (employing 24 percent of themanufacturing labor force), (2) textiles (16 percent), and(3) wood and wood products (I I percent). Female participationin the labor force also increased from 31 percent to 49 percent,with most of that growth in the manufacturing sector.Integration with the world market via these industries meantrapid growth in terms of value added, output, and employment.Singapore's 9.4 percent annual real growth between 1969-79has put it on the world map as another "economic miracle."

The manufacturing sector grew rapidly, with the electronics industry being a major contributor. Electronics is nowthe largest employer in Singapore's manufacturing sector. In1981, there were 185 establishments of "Electronic Productsand Components" employing 69,358 workers. Since at least1972, there have been constant increases in output, valueadded, and direct export in the industry. Compared with otherindustries in Singapore, the electronics industry is first innumbers employed, second in direct exports, value added, andoutput, seventh in sales, and eighth in number of establishments. Of the 185 firms, 97 employ over 100 workers and 105are wholly foreign-owned. In the semiconductor industry,women account for 81 .5 percent of the total workforce althoughthey make up 91 percent of the production workers. The jobsin which women are concentrated tend to be those that paypoorly, impart few skills, and provide few promotionopportunities.

The Japanese management system is similar

in essence to management practices in private enterprises elsewhere in seeking to control every aspect of the organization of work for the goal of productivity and profit. The expansion of Japanese capital into Southeast Asia in search of profits follows the same general laws that American capital does.

Although the economy is dominated by TNCs, thegovernment has played a strong and important role in directingaffairs in all aspects of Singapore society. Having developedinto a corporatist state, the government seeks the opinions ofleaders in the corporate world and labor unions in all majorpolicy issues.

In recent years, Singapore has faced increasing competition from other low-wage countries in the region forlabor-intensive industries. Presently, the government hasembarked upon a "Second Industrial Revolution" to upgradethe level of technology and labor skills. Consequently, theNational Wages Council raised wages by 20 percent per annumfor several consecutive years, forcing some of the factories toautomate or to relocate. At the same time, the government isactively promoting Japanese management, bringing in noted

16

speakers from abroad as well as introducing house unions andquality control circles. The government believes that inculcating the Japanese notion of company loyalty may preventworkers job-hopping for marginal increases in pay.

The "success" of Singapore-as measured by conventional indices of economic development and in the eyes ofinternational organizers-lies not only in its ability to attractforeign investment, but also in the ability of its rulers to controlall aspects of society for the attainment of whatever objectivesthe government has defined. Such is the context in whichworkers experience daily the fruits of national developmentstrategies.

Organization of Production at Company ZThe company under study, Z, is a subsidiary of a company

by the same name in Japan. While the parent is neither one ofthe oldest nor one of the largest electronics firms in Japan, itoperates six plants in that country, one in Taiwan, one in SouthKorea, and one in Singapore, plus trading offices in the U.S.and Western Europe. Serving both the international market andthe domestic markets of those countries where production

facilities are located, Company Z mainly manufactures TVson contract from large brand names. In other words, the TV smade by Company Z are sold to consumers under a numberof other brand names.

Three years ago, Company Z established its operations inSingapore in an industrial estate near residential and shoppingdistricts. The reasons for moving into Singapore were: (1) tobreak into the local market (TV being an important leisureactivity in Singapore), (2) to obtain cheap labor (wages beingconsiderably less than in Japan), and (3) to avoid export quotasinto the U.S. (which are more favorable for products fromSingapore than from Japan). Since output in the Singaporeplant has been larger than in plants elsewhere, the Singaporeoperation has been expanding rapidly. In March 1983, the totalworkforce there was nearly 180, of whom 130 were inproduction, and the company is still recruiting more productionworkers.

Like most other businesses in Singapore, Company Z runsa 5 1/z-day week, and like other small manufacturing operationsthere, it operates only one 8-hour shift per day. The productionprocess is divided into three lines. The first, the "sub line,"handles and organizes all the accessories that will be used bythe other two lines in the assembly process, while the second,the "mount line," inspects all parts of the printed circuit boardincluding tuning, alignment, soldering, and quality control.The "final line" assembles and tests the final product.

Eighty percent of the workforce at Company Z is female,but the women are concentrated in production and clericalpositions. Among the production workers, the majority isChinese. (In the manufacturing sector in Singapore, 73.7percent of the workforce is Chinese.) Although the proportionof Chinese in the company is less than in the population as awhole, it is greater than in most other electronics companies.Since Company Z makes no effort to recruit "foreign guestworkers," there are only about 10 non-Singaporeans amongthe operators and all of them are from Malaysia.

Management staff at Company Z are all Chinese andJapanese males. The Japanese hold the top managementpositions-managing director, two administrators for tradingand personnel, and one engineer. The second line comprisingtwo supervisors and one personnel officer is entirely Chinese.

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Each production line has a line leader, usually a long-serviceemployee (and Chinese) promoted from among the productionworkers. There is no union at Company Z. The average monthlylabor turnover rate is over 10 percent.

Management Policies and PracticesTo work as an operator for Company Z, one must have

completed primary school, although many of the workers havesome secondary schooling. The starting pay (prior todeductions for the Central Provident Fund) for operators in1983 was S$250 (US$120) per month. 12 While the minimumqualifications for Company Z are comparable to those in otherelectronics firms, the starting pay is slightly less. As in otherfirms, all operators are monthly rated, though a daily rate anbe deducted for absenteeism. An annual appraisal systemmakes annual increments possible, although none of theworkers was aware of the basis of the increment. Additionalpay, including time-and-a-half for overtime and a 13th monthbonus at the year's end, is also given according to Singapore'sLabor Laws.

Company benefits are also comparable to those in otherSingaporean firms. A panel of doctors is appointed by thecompany and workers can be fully reimbursed for medical carerendered by them. Medical Certificates for absence arerecognized only from these doctors and from governmentclinics. The Company also organizes social activities, such aspicnics, and an annual dinner and dance (including a beautycontest). Other supposed benefits include air conditioning, freeuniforms, and free safety equipment.

Differences in benefits from other firms are largely dueto size and location. Because the workforce is relatively smallthere is no clinic on company premises, and because the factoryis located near a hawker center no canteen is provided. Becausemost workers live close by, the company does not provide anytransportation services or subsidies.

In terms of management style, there are similarities aswell as differences with other TNCs operating in Singapore.Workers who have worked in other firms feel that CompanyZ makes a more active effort to instill company loyalty and touse peer pressure to makes its employees conscious that it isa Japanese firm. The loyalty is instilled primarily through"Monday Assemblies." Each Monday, before work commences, the entire workforce is gathered and a 15-minutelecture is given by the personnel officer. The topics generallyrevolve around such issues as productivity and work attitudes.Peer pressure is used to bring attention to those who deviatefrom the desired behavior; be it tardiness or poor productquality, the offense is made known publicly. These practicesare quite similar to those described in factories in Japan, 3 buthave not been common in plants elsewhere in the world.Company Z, however, is not fundamentally different fromother firms in its attitude toward production targets, factorydiscipline, and attitudes toward unionization.

12. CPF is, in essence, a social security scheme. Currently, the averagedeductions from a worke r's pay check are close to 25 percent of the basic pay.13. A woricer-informant was able to record the weekly lectures given bymanagement to the entire assembly of woricers. The tapes made available tothe researcher provide first-hand knowledge of the management process.

In the area of health and safety, aside from providingprotective gear and free medical care by appointed doctors,Company Z has set up a safety committee. Its structure is inconformity with Singapore Labor Laws, but its activities areat the discretion of the committee chair, as the law does notstipulate the committee's activities. Thus, it is a managementprerogative to give whatever priority and attention tooccupational health and safety it likes.

Workers and Their HealthOf the 23 respondents to the survey, two were technicians

and the rest were spread across all three production lines. Theirsocia-demographic characteristics (see Table 2), roughly

Table 2 Survey Results

Age: mean = 22; mode = 20Sex: 21 females, 2 malesMarital Status: 19 single, 3 marriedReligion: 10 BuddhistiTaoist, 7 Muslim, 4 ChristianEthnicity: 14 Chinese, 5 Malay, 4 IndianCitizenship: 19 Singaporean, 4 MalaysianEducation: mean=9.4 years; mode = 10 yearsIncome: mean = S$344/month; mode = S$300/month

mirror those of the electronics workforce in Singapore-young,

predominantly female, mostly single, racially mixed, withsome secondary school education, and not making very muchmoney. 14

In the electronics industry in Singapore, the averagemonthly wage in 1980 was S$290 for assembler and S$340for tester with 95 percent of the workers being below age 40.The minimum education requirement is six years of primaryschool, although those having secondary education andknowledge of English receive preference in employment.

The living situation of the respondents from Company Zis also comparable to others in the same socio-economic strata:95 percent live with their families, 94 percent live in flats, and61 percent own those flats. (In 1980,72 percent of Singapore'spopulation lived in public housing, all high-rise flats.) Theaverage size of household is 5. 9 persons, while the averagenumber of people sharing a bedroom with the respondent is2.7. (The mean size of household in government-owned flatsis about 5. )

Like other factory workers in Singapore, they seekemployment close to their homes. Twenty-six percent can walk

14. See review of women factory woricers in free trade zones of Asia in articleof same tide by Vivian Lin in E. Utrecht (ed.), Free Trade Zones in Asia andthe Pacific. Transnational Corporation Research Project, Sydney University;1984 (forthcoming).

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to work in less than twenty minutes, while another 34 percentcan take a less-than-twenty-minute bus ride.

The average length of employment at Company Z is two

years. For 56 percent of the respondents, the job at CompanyZ is their first. Those who have worked b