Gravy trains don't run on time:
Good riddance, Singapore model

For decades, Asian dictators claimed that they had perfected a higher form of capitalism. Those in power would determine which entrepreneurs would succeed, and these -- related by blood or bound by kickback to the politicians -- would maintain position by perpetuating the dynasty.

The world was assured by such philosophers as Singapore's Lee Kuan Yew that a concern for individual liberty was merely a "decadent Western value," and that Asians had discovered that a one-party state with a strong ruler could better provide the stability for growth.

In that Singapore model, taken up throughout Asia, society's order took precedence over individual freedom. Petty crime was crushed along with political opposition.

Western executives who hated the rigors of competition in a free market were pleased to invest in what seemed to be a sure-thing society. The greasing of government palms -- without the scrutiny of a free press or the restraint of independent judiciaries -- was advertised as a newly stable form of capitalism.

Growth-befuddled bureaucrats at the World Bank joined compilers of economic-freedom indexes to endorse such state-controlled commerce. They justified the secret dealing by peddling the notion that such license to do business among power elites would someday lead to political freedom.

It led to collapse. The waves of panic in Asia today, likely to be followed by despair and class resentment, show how wrong these fake capitalists were. The outstretched hand of local politics is no match for the invisible hand of the global market.

The dictatorial model, driven by mutual back-scratching of elites rather than a profit motive open to all, rewarded despotism and nepotism at the expense of efficiency and transparency. Now eyes are opening all over the world to the realization that the gravy train does not run on time.

Communism, socialism, fascism and "crony capitalism" not only interfere with the free flow of capital to the best producer, but deny the consumer the right to decide which products succeed. Once again autocrats and their acolytes are learning that government's business in business is to protect competition in business.

Consider Indonesia: The Suharto family, until the recent plunge of the rupiah, was probably richer than Bill Gates. International banks were imprudently lending the President's favored companies as much as desired for patently unproductive uses.

But American politicians and investors cannot tut-tut at Suharto predations without hypocrisy because many were buying into that vaunted "model." One flagrant example is how the Riady family, tightly tied into Suharto's deals, bought influence with candidate Clinton, parlaying that advertisable White House connection into politico-economic deals in Indonesia and China.

Small wonder, then, that before Congress approves the $43 billion bailout of Indonesia, through the I.M.F., Suharto will be expected to produce James Riady and Arief "James Riady sent me" Wiriadinata, to testify in the U.S. about the campaign and business activities of the longtime Riady employee John Huang, as well as those of "the two Marks" -- Middleton and Grobmyer -- friends and fund raisers for the Clintons who showed such as interest in Indonesia.

Infectious dealing among people in power and people with money is not an Asian virus; it is a global virus. The yearning of human freedom that undergirds democratic capitalism and produces stable prosperity is not a Western value, but a universal value.

Taiwan, the Philippines, South Korea, Thailand and even Japan show signs of grasping this; Vietnam, Malaysia and the powerful Lee family of Singapore still don't get it.

The question about the shakeout in Asia is not whether its resourceful, democratizing nations will recover; they will. The question is whether the political leaders and crony capitalists of Russia and China will get the message, gained at such pain, that there can be no stable prosperity without political freedom.