Inequality and flexible oligarchy

Pasuk Phongpaichit has had a long career taking on tough topics. As a professor of Economics at Chulalongkorn University, she’s written on Thaksin Shinawatra, corruption, gender and much more. In a short op-ed at the Bangkok Post, she takes on inequality, and area she has been researching for several years.

PPT isn’t about to summarize the academic’s article. However, we will highlight a few of the significant points. We also reproduce a graphic from The Economist from several months ago.

Pasuk begins:

For a long time, many commentators in Thailand argued that the massive inequalities in our society did not matter. That has changed. Our fierce political conflict has done that. Why is disparity worse here [than in neighboring countries], and why is it so persistent? The answer lies in our politics.

One of her answers is telling:

… real power still lies in the hands of small groups of people who run things in the dim background. It’s a kind of oligarchy (rule by the few) or at least an oligarchic tendency in our institutions.

She argues that this oligarchy has developed institutions and social networks that renew and reinvigorate this oligarchy as it adapts to a rapidly changing political economy.

One finding is that decentralization has been captured by elites that may be local but that also have “a network that stretches from Bangkok down to the locality, with influence in national politics, provincial officialdom and local government. This pattern is emerging in province after province.” This networking suggests that the rural-urban dichotomy so common in considering recent politics may need to be re-worked.

Another result  of the research is about another networking through military, business and parliamentary training institutes that creates “alumni” of influential people connected across the country where “alumni are bound to help one another.”

Pasuk concludes:

Our oligarchy is sustained by these creative forms of innovation in business, politics and education. The disparities in our society are diminishing very slowly, and in part that is due to the entrenched oligarchic tendency and its extraordinary flexibility in the face of change.

It is very difficult, for example, to think of a progressive property tax or capital gains tax being adopted because of the strong resistance from the groups at the apex of the political structure.

In Thailand, oligarchic political structures have not been eroded by t”democratisation, decentralisation and the works of social movements,” but have adapted to these circumstances and have been able to maintain their control.