Kentucky Fried Globalization

tags: Vietnam, Jeffrey Wasserstrom, Hanoi, fast food

Originally published 12-4-06

Mr. Wasserstrom is a professor of history at the University of California, Irvine, and a writer for the History News Service. He is the author of "China's Brave New World -- And Other Tales for Global Times," to be published in 2007.

Credit: Wiki Commons.

For anyone who follows the American media's treatment of Asia, coverage of President Bush's recent whirlwind visit to Vietnam was bound to trigger a sense of deja vu. Why? Because the approach reporters took to Hanoi's embrace of capitalism with authoritarian characteristics was so similar to the one they took to Beijing's moves in the same direction when Bill Clinton visited China back in 1998.

What remains to be seen is whether, over time, the American press corps will find a better way of handling the complex cultural dimensions of Vietnam's re-engagement with the West than the approach it took to China's in the 1990s. Will reporters manage to avoid, as some have failed to do so far, two pitfalls that marred treatment of China during Clinton's presidency? First, equating globalization with Americanization. Second, assuming that American products continue to mean exactly the same things as they do at home after they cross the Pacific.

Eight years ago, what might be called the "burgers and bowling" storyline shaped reporting on Clinton's trip. The idea conveyed in words and backed up with photos of Chinese eating Big Macs and shots of billboards for new Beijing bowling alleys, was clear: whatever was happening politically, American ways were transforming cultural life in China's cities.

Fast forward to the present and we find reports on Vietnam that take the same basic approach. McDonald's isn't there yet and bowling hasn't caught on. But stories about the first KFC to open in Hanoi have often read just like reports that appeared whenever a new American fast food chain gained its first foothold in China.

Once again, reporters and broadcasters have played up the irony of an icon of U.S. enterprise being welcomed by a once bitterly anti-American Communist Party. Once again, they have speculated that a wholesale "Americanization," particularly of local youth, is imminent.

It's natural that there should be carryover from 1990s China reporting to coverage of Vietnam today. After all, Hanoi has taken a page from Beijing's post-Tiananmen playbook. The Vietnamese Communists, like their Chinese counterparts, strive to stay in power by limiting political freedoms while increasing the choices that people have about what to consume and how to spend their private time.

One thing that should not be carried over, though, is the burgers-and-bowling approach to cultural change. This approach, with its emphasis on Americanization and its failure to note that even something as generic as a Big Mac can mean very different things depending on the context, should be retired. There are more accurate, and more interesting, ways that the story of an Asian Communist country's re-engagement with the West can be told.

Yes, some Chinese learned how to score strikes and spares in the 1990s, but a far more popular leisure time novelty was karaoke. A more appropriately complex vision of globalization would have been conveyed by stories focusing on that cultural import. It's an activity that has roots in the Philippines and has become associated above all with Japan, but in China involves play lists that include some American songs.

When it comes to generic products taking on localized meanings, the cases of Chinese McDonald's and Starbucks are illustrative. Thomas Friedman of the New York Times insists that a Big Mac is a Big Mac is a Big Mac wherever it's bought and whoever eats it. But UCLA anthropologist Yan Yunxiang has shown convincingly that the same burger means different things in Beijing and in Boston.

In 1990s China, for example, Big Macs were thought of not as meals but snacks (because of their resemblance to pork-filled buns that were never imagined to constitute a main course). And Chinese yuppies (unlike their U.S. counterparts) viewed McDonald's as a good venue for a romantic dinner date.

The arrival of China's first Starbucks six years ago was often told as a simple tale of Americanization. But, again, this was misleading. The management company that oversaw Chinese branches was based in Taiwan, not Seattle, and local guidebooks in Shanghai classified these outlets as "European-style" as opposed to "Japanese-style" cafes.

So if -- or, perhaps more realistically, when -- burgers and bowling alleys follow buckets of The Colonel's chicken to Hanoi, let's hope American reporters learn from past misreadings. It is seductive to contemplate the imminent Americanization of a country governed by a once intensely anti-American regime. But reporters and broadcasters owe it to their readers and viewers to come up with a better way than burgers and bowling to frame this tale of globalization.

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This piece was distributed for non-exclusive use by the History News Service, an informal syndicate of professional historians who seek to improve the public's understanding of current events by setting these events in their historical contexts. The article may be republished as long as both the author and the History News Service are clearly credited.

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Andrew D. Todd - 12/13/2006

I think one significant cultural difference is the notion of what one might call Ludic Production, the notion that making things is a worthy and honorable recreation.

The patron saints of ludic production were Louis XVI (the clockmaker) and Marie Antoinette (the shepherdess). They had both reached the point where consumption became absurdity. Even war, the traditional business of kings, was no longer as serious as it had once been. Louis XVI could not go off to Canada and fight for Detroit, nor could he go to India, and fight for Pondicherry, the way Louis XIV had gone and fought for Flanders a hundred years earlier. France's major rivalry was now maritime and global, months of travel away from Paris. The most Louis XVI could do was to send off minor noblemen, of the professional adventurer type, such as Lafayette, and pay their bills. At the time, many of Louis XVI's contemporaries simply could not understand what he was about with his clockmaking, and he came in for a fair amount of derision. The courtiers, busily scrambling for places, could not deal with the idea of someone having nowhere further to go. Since the time of Louis XVI, ludic production has become widespread in the developed countries.

I have seen a certain amount of anecdotal evidence to the effect that educated Indians and Chinese, who could engage in ludic production if they wanted to, are simply unable to comprehend what ludic production is all about. This probably gives them an exaggerated idea of Americans' willingness to pay for things, and consequently, an exaggerated idea of the viability of an economy based on exporting consumer goods to the United States. I doubt these Indians and Chinese have any real grasp of the social demographics of Wal-Mart. Indians and Chinese tend to understand the United States only in material terms, not in spiritual terms, and of course this means that in the last analysis, they tend to misunderstand what the United States will do and why.

One implication of ludic production is that producer goods are also consumer goods. The ludic producer covets "heavy iron." A steam locomotive is heavy iron. So is a Boeing 747. So, twenty-five years ago, was the kind of computer which filled an entire room, say an IBM 370/3081. And so is a computerized metal-shaping machine which can produce other machines from blueprints. The ludic producer admires the kind of production machinery being used by the largest corporations, and by the government itself, and, if at all possible, desires to own something of comparable sophistication himself. One implication is that there is an enormous premium on "re-inventing" expensive production machines as inexpensive consumer goods, and this tends to drive the state of production machines far beyond what orthodox industrial economics would dictate. To put this in concrete terms, a suburban householder with a houselot of an acre may very well go out and buy a lawn tractor, costing, with all imaginable accessories, several thousand dollars. This tractor is powerful enough to do a tolerably efficient job of cultivating a farm of a hundred acres, if used by a full-time farmer. Of course, to be economically employed as a full-time farmer in the United States, you need about a million dollars worth of land, and in that case, you buy a much bigger tractor.

At a certain point, the acknowledged proprietors of the heavy iron, the corporations and the government, find it advantageous to use consumer production equipment. This equipment may not be as durable as heavy iron, but it is much cheaper, and easily replaced. This changeover point has been reached in computers, and the result is that some of the most exemplary and admired computer experts are fourteen-year-old boys. The next stage of progress involves manufacturing machines. Once a machine is successfully "ludicized," it is likely to have costs equivalent to a human wage of about a penny an hour.

If the machine can do a task at all, and if machine output is considered as good as hand output by the ultimate consumer, it is futile for the third-world producer to strive for cheaper wages, because the machine will ultimately drive him below literal starvation point, and that probably in a very few years. From the third-world producer's point of view, this is rather like dealing with a sort of techno-jihadi, someone bent on destroying the producer for ideological reasons, who is not open to discussion. Of course, the promoters of technology are not actually fanatics-- they are simply Americans behaving reasonably for Americans.

There are three well-defined types of products which account for a widely disproportionate share of imports: automobiles, electronics, and clothing. They each have peculiar characteristics which prevent them from being "mass-produced fifty-year durables." For example, a frying pan is both inexpensive, due to mass production, and lasts practically forever, Wal-Mart has to price its frying pans in competition with the local Salvation Army ("Sally Ann") store. A backwards country cannot build a viable export economy around frying pans. What makes automobiles distinctive is that the terrific strains of road-wear cause them to break down in a fairly short period of time. Electronics are distinctive for their rapid rate of technological change. Clothing is distinctive for its extremely fragile character.

In the finer forms of electronics manufacturing, human workers are essentially counterproductive. Human workers breathe, and it is difficult to prevent their breath from contaminating the product. Hand labor is marginalized to the coarser sorts of packaging tasks. Making electronics better inevitably means squeezing out more human labor. Third-world countries, such as China, try very hard to develop electronics industries, for obvious reasons. They are willing to pay what amounts to full tuition, and depending how shrewd they are, they may or may not get cheated, palmed off with something which does not give them an autonomous electronics industry. I suspect the Vietnamese are more of "country cousins" than the Chinese, and are more likely to get clipped.

The automobile industry, as the premier mechanical consumer goods industry, is in the process of increasing its electronics content, both in the sense that automobiles contain more electronic components and fewer mechanical ones, and also in the sense that automobiles are manufactured with more robots and fewer assembly-line workers. The auto industry is chronically insolvent, which means that this modernization takes place at a snail's pace. The attraction of moving production to a third-world country is that the firm can just move the machinery (not buy new), and reduce its labor costs, without having to go through the pains of modernization. Such a firm _can_ use the proceeds to build highly modernized plants in a developed country, but the nature of such firms is that they are much more likely to spend the money on something other than industrial investment in their core industry. Thus far, I am speaking about automakers in their own countries of citizenship. The Japanese firms in North American are a special case. They labor under the disability of being foreigners, and they are therefore obliged to carry corporate citizenship to a level which American firms are not obliged to match. Hence the Japanese firms go in for "extreme automation," in one form or another. Having produced this automation, they are under pressure to license it to American automakers, or even to sell components (such as engines, transmissions, etc.) based on it.

As for political stewardship, you have to remember that there are large areas of business which move so fast that it's a case of 100% return on investment or nothing. Take fashion-driven clothing, for example,-- the manufacturer times it to coincide with an event, such as the release of a movie. Within a few weeks, it's either sold or remaindered. Similarly, for electronics, a production machine has to pay for itself within the year, or it never will, what with technological obsolescence and Moore's Law. After the premium -price window has expired, it doesn't greatly matter from a business standpoint who winds up in physical possession of the manufacturing equipment. Of course, it can be argued plausibly that Moore's Law is itself a fashion process ("My computer is bigger and badder than your computer, you weenie, you weenie, you weenie!"). In many cases, the manufacturing operation performed in a third-world country is one which the manufacturer does not expect to be performing at all, anywhere in the world, in two or three year's time. Long-term political considerations do not count for very much, under those circumstances. Bear in mind that manufacturing as a whole is a declining sector. The fact that a firm is manufacturing in the third world implies that it does not have a government subsidy connection in a developed country-- the equivalent of Being Paid Not to Grow Alfalfa.

In the United States, the military is the major agency of a certain type of stewardship, not precisely political, in something of the same sense that the Boy Scouts are not precisely political. The military worries about a whole series of things like the decline of craftsmanship. The military also worries about economic independence. There are limits to what the military can do, of course. It cannot impose trade barriers, or create massive job losses in the United States, or do anything likely to increase the price of major consumer goods in the short run (Sematech, circa 1990, was a major blunder). However, the military can work around the edges. Suppose that at some point, the United States Army decides that it is worried about the supply of automobiles and trucks for its own use. Strictly speaking, a rational economist might invite the military to lay down stockpiles, but of course that is not what the military will do. What the military will do is to push developments in automation, especially general-purpose automation, as distinct from the special-purpose automation normally used on assembly lines. The military will be be willing to back up its concerns to the tune of five or ten billion dollars, which is not really a very large sum by Pentagon standards. This money will be used to pioneer things like new kinds of machine tools, much more heavily computerized than those which are in general use at the present, and capable of operating in a much more versatile fashion. The military would of course operate synergistically with the home craftsmen, and the calculatedly respectable Japanese automakers. Jointly and severally, these groups will present the global automobile industry with a whole series of "offers it cannot refuse," in much the same sense that, in the twentieth century, the automobile industry presented the farmer with a whole series of "offers he could not refuse." If the automobile industry has migrated all its labor to China anyway, then there are no real limits to the extent to which the military-hobbyist complex can push the automobile industry around.

All the more desirable export industries in the third world will collapse as fast as they arose, or at least their export markets will. Possibly the export industries can be adapted to the internal markets of their own countries, possibly not.

Paul Mocker - 12/5/2006

I just skimmed your essay so forgive me if the answer can be found in it.

Do you have hope that media can accurately and objectively report on globalization?

Thomas L. Friedman talks about the Electronic Herd and its ability to bring down or support governments. Given the many structural problems with Vietnam, when will global investors be confident with investing there?

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