State Capitalism: How the Return of

Statism is Transforming the World 1st

Edition Joshua Kurlantzick
Visit to download the full and correct content document:
https://textbookfull.com/product/state-capitalism-how-the-return-of-statism-is-transfor
ming-the-world-1st-edition-joshua-kurlantzick/
More products digital (pdf, epub, mobi) instant
download maybe you interests ...

Reshaping retail why technology is transforming the

industry and how to win in the new consumer driven
world 1st Edition Niemeier

https://textbookfull.com/product/reshaping-retail-why-technology-
is-transforming-the-industry-and-how-to-win-in-the-new-consumer-
driven-world-1st-edition-niemeier/

The New Common: How The COVID-19 Pandemic Is

Transforming Society Emile Aarts

https://textbookfull.com/product/the-new-common-how-the-
covid-19-pandemic-is-transforming-society-emile-aarts/

How The SPECTER OF COMMUNISM IS RULING OUR WORLD 1st

Edition The Epoch Times

https://textbookfull.com/product/how-the-specter-of-communism-is-
ruling-our-world-1st-edition-the-epoch-times/

A Great Place to Have a War America in Laos and the

Birth of a Military CIA Joshua Kurlantzick

https://textbookfull.com/product/a-great-place-to-have-a-war-
america-in-laos-and-the-birth-of-a-military-cia-joshua-
kurlantzick/
Future Foods How Modern Science Is Transforming the Way
We Eat David Julian Mcclements

https://textbookfull.com/product/future-foods-how-modern-science-
is-transforming-the-way-we-eat-david-julian-mcclements/

Goodbye Globalization The Return of a Divided World 1st

Edition Elisabeth Braw

https://textbookfull.com/product/goodbye-globalization-the-
return-of-a-divided-world-1st-edition-elisabeth-braw/

The Politics of Everyday Life in Fascist Italy: Outside

the State? 1st Edition Joshua Arthurs

https://textbookfull.com/product/the-politics-of-everyday-life-
in-fascist-italy-outside-the-state-1st-edition-joshua-arthurs/

The State of China’s State Capitalism: Evidence of Its

Successes and Pitfalls Juann H. Hung

https://textbookfull.com/product/the-state-of-chinas-state-
capitalism-evidence-of-its-successes-and-pitfalls-juann-h-hung/

The Dark Cloud How the Digital World Is Costing the

Earth 1st Edition Guillaume Pitron

https://textbookfull.com/product/the-dark-cloud-how-the-digital-
world-is-costing-the-earth-1st-edition-guillaume-pitron/
State Capitalism
State Capitalism
How the Return of Statism Is
Transforming the World

JOSHUA KURLANTZICK
A Council on Foreign Relations Book

1
1
Oxford University Press is a department of the University of Oxford. It furthers
the University’s objective of excellence in research, scholarship, and education
by publishing worldwide. Oxford is a registered trade mark of Oxford University
Press in the UK and certain other countries.

Published in the United States of America by Oxford University Press

198 Madison Avenue, New York, NY 10016, United States of America.

© Oxford University Press 2016

All rights reserved. No part of this publication may be reproduced, stored in

a retrieval system, or transmitted, in any form or by any means, without the
prior permission in writing of Oxford University Press, or as expressly permitted
by law, by license, or under terms agreed with the appropriate reproduction
rights organization. Inquiries concerning reproduction outside the scope of the
above should be sent to the Rights Department, Oxford University Press, at the
address above.

You must not circulate this work in any other form

and you must impose this same condition on any acquirer.

Library of Congress Cataloging-in-Publication Data

Kurlantzick, Joshua, 1976– author. State Capitalism: How the Return of Statism is
Transforming the World / Joshua Kurlantzick. New York, NY: Oxford University Press,
[2016] LCCN 2015041700 (print) | LCCN 2015044813 (ebook)
ISBN 9780199385706 (hardcover: alk. paper)
ISBN 9780199385713 (E-book)
ISBN 9780199385720 (E-book)
LCSH: Government ownership—Developing countries. | Capitalism—Political aspects—
Developing countries. | Industrial policy—Developing countries. | International business
enterprises—Government policy—Developing countries. | Free trade. | Democracy—
Economic aspects. Classification: LCC HD4420.8 .K87 2016 (print) | LCC HD4420.8
(ebook) | DCC 338.6/2091724—dc23

9╇8╇7╇6╇5╇4╇3╇2╇1
Printed by Sheridan, USA

The Council on Foreign Relations (CFR) is an independent, nonpartisan membership

organization, think tank, and publisher dedicated to being a resource for its members,
government officials, business executives, journalists, educators and students, civic and religious
leaders, and other interested citizens in order to help them better understand the world and
the foreign policy choices facing the United States and other countries. Founded in 1921, CFR
carries out its mission by maintaining a diverse membership, with special programs to promote
interest and develop expertise in the next generation of foreign policy leaders; convening
meetings at its headquarters in New York and in Washington, DC, and other cities where senior
government officials, members of Congress, global leaders, and prominent thinkers come
together with CFR members to discuss and debate major international issues; supporting a
Studies Program that fosters independent research, enabling CFR scholars to produce articles,
reports, and books and hold roundtables that analyze foreign policy issues and make concrete
policy recommendations; publishing Foreign Affairs, the preeminent journal on international
affairs and US foreign policy; sponsoring Independent Task Forces that produce reports
with both findings and policy prescriptions on the most important foreign policy topics; and
providing up-to-date information and analysis about world events and American foreign policy
on its website, www.cfr.org.
The Council on Foreign Relations takes no institutional positions on policy issues and has
no affiliation with the US government. All views expressed in its publications and on its
website are the sole responsibility of the author or authors.
For Caleb and Jonah
Contents

1. The State Is Back in Business 1

2. The Types of State Capitalism 27

3. A Brief History of (State Intervention) Time 49

4. Why State Capitalism Has Re-╉Emerged 64

5. China’s State Capitalism—╉A Closer Look 93

6. The Democratic State Capitalists—╉A Closer Look 115

7. The Lesser Threats: State Capitalism and Its

Threat to Democracy 137

8. State Capitalism’s Long-╉Term Economic Future:

A Threat to Countries’ Own Long-╉Term
Development and to the World Economy? 157

9. A Greater Threat: State Capitalism’s Long-╉Term

Effectiveness and State Capitalism as a Model 175

10. The Greatest Threat: Resources, State Firms

as Weapons, and the Two Big Authoritarians 203
viii╅↜渀屮↜渀屮↜渀屮↜渀屮Contents

11. Prescriptions for the Future 225

Acknowledgments 251

Notes 253

Index 277
1
The State Is Back in Business

In late 2013, in a highly publicized address to the Communist

Party’s plenum, new Chinese president Xi Jinping announced that
the government would unleash the private sector, after decades of
gradual economic reforms that left many of China’s biggest indus-
tries in the hands of state-╉owned giants. Market forces, rather than
the state, would now play a “decisive role” in the Chinese economy,
Xi declared, a line touted by Chinese and foreign media. Many in-
vestors in China also interpreted the declaration as a sign of Xi’s
reformist plans. Some news stories compared Xi to sainted former
leader Deng Xiaoping.
Xi, who had used his own political savvy to eliminate many
rivals and make himself the most powerful Chinese leader within
the Party since Deng Xiaoping, hardly shied away from compar-
isons to Deng, who oversaw the beginning of China’s era of eco-
nomic reform. Indeed, Xi portrayed himself to the Chinese public
and foreign investors as a once-╉in-╉a-╉generation economic reformer
who could streamline the Chinese economy, slashing waste and
unleashing the private sector.
Clearly trying to emulate Deng, in 2014 Xi made a surprise
high-╉profile trip to a new free-╉trade zone in Shanghai, the coun-
try’s financial capital. The trip was designed to remind Chinese
of Deng’s early 1990s tour of southern China. Deng had used his
southern trip to kick-╉start economic reform after the Tiananmen
massacre paralyzed Chinese politics and China’s economy as well.
2╅↜渀屮↜渀屮↜渀屮↜渀屮 State Capitalism

In Shanghai, where media outlets favorably compared Xi’s visit to Deng’s

“Southern Tour,” Xi offered more promises that the private sector, not the
state, would be empowered on his watch, praising the free-╉trade zone and
urging local leaders to attract domestic and foreign private investment.
In late 2013 and early 2014, at the end of the eighteenth meeting of the
Party’s Central Committee, Xi and premier Li Keqiang announced more
specifics of how they planned to help market forces play that “decisive role”
in the Chinese economy. The Chinese leaders touted land reforms designed
to make it easier for rural Chinese to sell their land, changes that would
allow some state firms to go bankrupt and be liquidated, quicker approval
processes for Chinese entrepreneurs and for potential foreign investors in
China, an opening up of some energy projects to private companies, and
an end to state-╉mandated prices in some sectors.1 The two men promised
that private companies would be treated equally, before the law, as state-╉
owned Chinese firms, the first time any Chinese leaders had made such
a promise. Premier Li also suggested that China could grow much more
slowly than it had in years past—╉that Chinese people must accept slower
growth as China kicks its addiction to cheap credit and cleans up bad
debts in state-╉controlled banks, and as China makes the transition from
an economy heavily dependent on manufacturing and state investment to
one more reliant on services and consumer spending. In September 2015,
Beijing announced more proposed reforms, including reforms designed
to further liberalize state enterprises by pushing more state companies to
sell public shares, giving boards of state enterprises more independence,
and loosening restrictions on hiring and salary for state firms in order
to attract better management talent from the private sector, among other
changes.2
But Xi and Li’s plans for economic reform, and a gradual economic
slowdown that they called “the new normal,” so far have amounted to
little, and it is far too soon to see if the most recent announced reforms
will have any impact. The sharp drop in China’s stock markets during the
summer of 2015, which stirred anger among Chinese investors and led
some China observers to conclude that Beijing would respond by speeding
up its economic liberalization, also has had little impact on the pace of
reform. In fact, contrary to the impression perpetuated by top Chinese
leaders that China continues to open its economy and reduce the power of
the government over many sectors, over the past decade Beijing actually
has taken back control of many parts of the economy, such as energy and
 The State Is Back in Business↜渀屮↜渀屮↜渀屮↜渀屮╅ 3

commodities and information technology. The Xi administration also has

clamped down on critics who question this continued state intervention
or even argue that China’s economy is slowing faster than the leadership
desires. Indeed, state capitalism is, in many respects, on the rise in China—╉
and all over the world.

STATE CAPITALISM SURVIVES IN CHINA

Since the mid-╉2000s, several generations of Chinese leaders actually have

reversed economic reforms launched in the 1990s by former premier Zhu
Rongji and pushed by admission to the World Trade Organization (WTO)
in 2001. Zhu had forced many state-╉owned companies into bankruptcy, and
made others privatize and sell off assets to survive. But since the mid-╉2000s,
after Zhu Rongji retired, Beijing has been aggressively tightening govern-
ment management of leading companies. Even under supposed reformist
Xi Jinping, Beijing has been boosting state interventions in equity markets
and increasing state subsidies to preferred firms in industries it considers
critical, including energy, telecommunications, information technology,
and most other areas that Beijing considers important to making the
Chinese economy more modern, innovative, and globally competitive.
One study showed that annually, Beijing and provincial governments set
up eight thousand new state-╉owned investment companies to increase state
control of industries in smaller cities and towns across the country.3 China’s
State Assets Supervision and Administration Commission (SASAC), a kind
of central administrator of state-╉owned companies, admitted in 2012 that
state-╉owned enterprises (SOEs) now own 66 percent of all assets in China,
an increase from 60 percent a decade ago.4
China’s bank lending displays this trend toward greater state control
of the economy’s key sectors. Whereas in the 1980s and early 1990s, pri-
vate enterprises in China had received increasing amounts of government
loans, in 2009 and 2010, private small and medium sized enterprises got less
than 9 percent of the US $1.1 trillion in loans handed out by government-╉
controlled banks, according to economists Usha Haley and George Haley.
Instead, state-╉controlled companies received nearly all of the $1.1 trillion
in loans.
In many strategic sectors of the economy, the state companies are
getting bigger and more dominant. Overall, reports GK Dragonomics, a
4         State Capitalism

leading consulting and research firm based in Beijing, the industrial output
of China’s SOEs has risen from six times as large as the median Chinese
private company in 2004 to eleven times as large in 2010.5 Today, of the
forty-​two biggest companies in China, only three are privately owned.6
State enterprises account for about a third of all capital spending in China,
according to a report by GK Dragonomics, whereas in most developed
economies state companies account for no more than 5 percent of capital
spending.7
Beijing now appoints senior directors of many of the largest companies,
and they are expected to become Party members, if they are not already;
the loosening of rules for hiring executives does not seem to apply to the
biggest state enterprises. Working through these networks, the Beijing lead-
ership sets state priorities, gives signals to companies, and determines cor-
porate agendas, but does so without the direct hand of the state appearing
in public. One study, by China scholar Minxin Pei of Claremont McKenna
College, found that the Chinese Communist Party had appointed roughly
80 percent of all chief executives at state-​owned companies, as well as half
of all senior executives just below the rank of CEO.8 And despite reforms
announced in late 2015, Beijing still seems reluctant to let the largest state
enterprises, in industries it considers strategic, go bust, a reform many
economists have encouraged Beijing to allow. At the biggest state firms,
reported The Economist, Beijing is “keeping party hacks in the most senior
jobs … and cutting their salaries, a sure way to discourage top talent from
the private sector.”9
State-​owned enterprises have become so resurgent in China over the
past decade that their revival has created a common expression used among
Chinese businesspeople, officials, journalists, and academics: Guo Jin min tui.
In English, it means, “The state advances, the private sector retreats.”10
(Some businesspeople say guo jin min tuia da chao, which means a “tidal
wave” of state advances.)11 As GK Dragonomics found in its analysis of state
firms, the strength of state companies also forces China’s truly private com-
panies into developing much closer relations with the Communist Party
than they might otherwise like, in order to compete in many industries with
state firms.12
Even former Chinese premier Wen Jiabao, who gave a series of speeches
as he neared retirement that some observers interpreted as pushing for fur-
ther reforms, actually publicly spoke out far more often about the benefits
 The State Is Back in Business          5

of China’s centralized economic decision-​making. “The socialist system’s

advantages enable us to make decisions efficiently, organize effectively, and
concentrate resources to accomplish large undertakings,” Wen told one
group of top Chinese leaders.13
In the wake of the downturn in China’s equity markets during the
summer of 2015, Beijing’s commitment to statist strategies was clearly evi-
dent. Some Chinese and foreign businesspeople hoped that the sharp slide
of the Shanghai and Shenzhen exchanges might prompt the Xi Jinping
administration to liberalize equity markets, and even the broader economy,
since foreign investors worried about participating in equity markets that
did not operate freely, and since Beijing would not be able to stabilize the
stock exchanges without allowing a degree of market correction. The head
of BlackRock, the giant money manager, and one of the few foreign compa-
nies with a license to trade shares on Chinese exchanges, warned that unless
Beijing began to liberalize its equity markets, foreign capital investors were
going to lose interest in putting money into China’s exchanges.
Yet the reverse happened. During the markets’ rise, Beijing had done
little to discourage Chinese citizens from believing the government would
ensure stocks rose and rose with no end in sight. In fact, Xi’s administration
utilized equity markets as a government tool to promote certain favored
companies and types of innovation. State publications and prominent of-
ficials repeatedly praised equity markets, called on Chinese citizens to put
their money in Chinese stock exchanges, and offered what were essentially
promises that the markets were fail-​safe forms of investing. In April of 2015,
the state-​owned People’s Daily declared that China’s bull market would con-
tinue surging, while in May it published an interview with an unnamed
government insider—​many China observers believe that the paper sim-
ply prints official government messages and attributes them to an insider’s
comments—​who encouraged Chinese people to buy stocks, suggesting
stock purchases were a kind of patriotic duty.
But many Chinese citizens had begun playing the markets with debt;
margin lending in China had reached extreme highs by the spring of 2015.
In contrast to most major markets, Chinese stock markets were powered
by retail investors, not institutional investors, and so were subject to wild
swings. A Goldman Sachs study of Chinese equity markets concluded that,
as of early June, about 12 percent of the market capitalization of Chinese
stocks had been purchased with debt, “easily the highest in the history of
6╅↜渀屮↜渀屮↜渀屮↜渀屮 State Capitalism

global equity markets.” The study did not even take into account stocks
bought with debt from China’s shadowy networks of non-╉bank lenders.14
When the market turned bearish during early June 2015, this debt-╉
fueled investing collapsed on itself. Chinese men and women sprinted to
sell stocks to cover their debts, fueling a downward spiral. And there is no
doubt that some Chinese investors—╉especially novices who had not pre-
viously witnessed a sell-╉off—╉felt betrayed by Beijing’s past assurances that
the markets were safe places where Chinese money would grow and grow.
China’s financial microblogs, where many ordinary investors chat, and
which had previously often focused on market tips, filled up with broad-
sides against Beijing for “allowing” equity markets to fall throughout the
summer of 2015. (By August 2015, the Shanghai exchange had fallen by
over 40 percent from its highs earlier in the year.) In the wake of the
market slump, few of the Chinese posting criticism on microblogs called
for faster economic or political liberalization, of the kind some foreign
investors and commentators suggested was necessary. Many Chinese in-
vestors demanded the government do more to “save” China’s exchanges
from the sell-╉off, even if doing more gave greater powers to the central
government.
The government mostly attempted to “save” the Chinese exchanges
rather than letting market forces play themselves out, even if they resulted
in a major correction in the stock markets. Beijing launched several plans to
reforms its exchanges over the long run, such as by curbing margin selling
and linking mainland China’s exchanges more closely with equity markets
in more transparent and better-╉regulated Hong Kong. But these reforms
were dwarfed by the government’s efforts to control the market’s trajectory.
Starting in June 2015, Beijing poured state money into the market to stanch
the bleeding, and is also believed to have been behind announcements by
China’s brokers association of a new target—╉4,500—╉for the Shanghai index.
Beijing also halted IPOs, allowed for the suspension in trading in hundreds
of companies that stood to be decimated by the rout, recruited state banks
to funnel at least $200 billion to brokerages to help buy shares, and used
official speeches and written commentary to assure ordinary Chinese that
the market would stabilize.
Although the government eased up on its intervention in the late sum-
mer, by early September 2015, with equity markets falling again, Beijing
started buying back shares on the markets once more. Some Chinese ana-
lysts and businesspeople speculated that the government propped up the
 The State Is Back in Business↜渀屮↜渀屮↜渀屮↜渀屮╅ 7

markets again because it did not want them to be falling during a major
parade held in Beijing in early September to mark the seventieth anniver-
sary of the end of World War II. Beijing also launched highly public cam-
paigns against Chinese financial journalists, short-╉sellers, and analysts who
had dared question the fundamentals of China’s equity markets or warned
that they had farther to fall. Over the summer of 2015, the government
detained over two hundred journalists, analysts, and other Chinese citizens
who allegedly posted “rumors” online of problems in China’s markets and
accused Chinese officials of malfeasance in dealing with equity markets.
In one prominent case, financial journalist Wang Xiaolu, of one of China’s
most respected financial publications, appeared on state television and
“admitted” that his reporting had caused “panic and disorder.” In his
reporting, he had merely suggested that Beijing’s intervention in the mar-
kets would not, in the long run, be successful in promoting stability.15
Other prominent Chinese financial analysts also were hounded. As The
Economist reported, “Police have also gone after executives with Citic
Securities, the nation’s top brokerage, eliciting confessions for insider
trading in near record time. Then there is the mysterious case of Li Yifei,
the head of China for Man Group, a leading hedge fund … She had
been taken into custody, though subsequent reports said she had merely
been summoned to a multi-╉day meeting with officials in an undisclosed
location.”16

BUT STATE CAPITALISM IS NOT JUST ABOUT CHINA

Although China’s SOEs have received the most coverage of any state com-
panies around the world, they are hardly alone. China is but one example of
a new era of state capitalism born over the past decade, even though nearly
all discussion in the West of the rise of state capitalism has focused on China
alone. Throughout the developing world, many states are increasing their
intervention in their economies. State capitalism today is hardly mono-
lithic; instead, it is better understood as a continuum, just as free-╉market
capitalism runs along a continuum from extreme laissez faire economics
to a French or Scandinavian model of a highly regulated market economy.
Although some observers of state capitalism have suggested that
only authoritarian states like China or Russia could be called state capi-
talists, in reality today’s spectrum of state capitalists includes democratic
8╅↜渀屮↜渀屮↜渀屮↜渀屮 State Capitalism

states like Brazil and Indonesia; authoritarian states like China, Russia,
Egypt, and Vietnam; and countries that lie somewhere on the continuum
of political freedom, like Malaysia and Singapore. Modern-╉day state cap-
italism includes countries like the United Arab Emirates, Venezuela, and
Russia, which have based their state intervention on government control
of natural resources—╉often oil and gas but sometimes other resources—╉
and state capitalists that are relatively poor in natural resources, like
China and even India, have used government to build manufacturing
and services sectors, encourage innovation, and create an economy
based on far more than pulling resources out of the earth. It includes
countries whose brands of state capitalism seems to have more staying
power, precisely because they are not based on resource extraction, and
those whose state intervention will fail—╉or, in the cases of Russia and
Venezuela, already are failing. It includes a broad continuum of the types
of intervention—╉countries whose governments control nearly all of the
biggest companies in that nation, and countries whose governments
control only a significant portion of the economy. It includes countries
that are very open to trade, like Singapore, and those that are far less
open to international trade. And it includes countries whose type of state
capitalism could undermine the best aspects of free-╉market capitalism—╉
innovation, entrepreneurship, individualism, and democracy—╉as well
as those countries where state capitalism could coexist with individuals’
economic and political freedoms.
Too often, Western policymakers and analysts have paid little attention
to the rise of state capitalism, even as the number of state-╉capitalist econ-
omies has grown over the past two decades. Or, if policymakers and other
opinion leaders have paid attention, they have focused only on China—╉
they have not seen these distinctions within state capitalism, viewing state
capitalism as either a threat to democracy and the free market or as a model
destined to collapse on its own, and so not worth worrying about.

WHY THIS SHIFT MATTERS

But to understand this resurgence of state capitalism, and to more finely

assess what is threatening or not about state capitalism, understanding
these distinctions is critical. We first need to comprehend what is different
 The State Is Back in Business          9

about state capitalism today from previous eras of state intervention in

economies, how we can better define state capitalism, and why the dramatic
growth in state capitalism in recent years could potentially transform the
international economy and international security.
Of course, almost every state intervenes in the economy to some extent.
In fact, states have intervened in economies almost since the concept of a
state emerged. But today’s state capitalists are not like the statists of the
last century, such as the Soviet Union or Mao’s China; neither are they like
the mercantilists of the seventeenth and eighteenth centuries, the European
powers who practiced an extreme form of economic nationalism, including
erecting high tariffs and other types of protection. The Soviet Union and
Mao’s China, of course, failed economically; after the collapse of the Eastern
Bloc and the end of the Cold War, most developing countries embraced the
idea of open economies and freer politics. In addition, no two state cap-
italists are alike, and this book will examine many different types of state
capitalists.
Still, even accepting that there is no one definition of state capitalism,
we need a more precise definition of who the modern state capitalists are,
so we can understand how explosively state capitalism has grown, so we
can weed out countries that do not belong in the category, and so we can
better examine the successes and failures of state capitalists. No definition
will ever capture this trend with complete precision, but for the purposes of
this book, I identify state capitalists as countries whose government has a
ownership stake in or significant influence over more than one-​third of the
five hundred largest companies, by revenue, in that country, a situation that
gives these governments far greater control over the corporate sector than
a government in a more free-​market oriented nation like the United States
or the United Kingdom. Generally, in these state-​capitalist countries the
government sees itself as having a direct role to play in managing the econ-
omy and guiding the corporate sector. I use the term “state capitalists” only
to refer to countries and their governments (which I use interchangeably),
not to any specific state-​owned companies, although of course these state-​
owned companies are a central part of state capitalism. Below this one-​third
level of government ownership of companies by revenue, the economy is
still determined primarily by the market, even though the state may play
a significant role. In addition, setting the bar here disqualifies many devel-
oped economies, like France and Japan, whose governments are relatively
10         State Capitalism

interventionist but which do not micromanage the economy and the corpo-
rate sector to the extent of the modern state capitalists like China, Vietnam,
India, Russia, Venezuela, or Singapore. These more developed economies,
like France, may indeed use state funds to own large portions of some large
French companies, but in these developed economies the government con-
trols or has influence over less than one-​third of the largest companies by
revenue. Norway is an exception and qualifies as a state capitalist, although
because this book focuses primarily on developing nations it will not dis-
cuss Norway in great detail, except as an example of some positive trends
in state companies.
In many other nations, the government owns a majority stake in some
companies but not as many as in the state capitalists; just having a state
company or two does not make a country a state capitalist. Mexico’s gov-
ernment owns the state oil giant, Pemex. Canadian provincial governments
own energy companies HydroQuebec, BCHydro, and several others. Yet
none of these countries have state-​capitalist economies. Their governments
may be more interventionist than those of, say, the United Kingdom, which
has privatized nearly all its former state companies, but they are not state
capitalists—​the Mexican and Canadian governments own only a tiny por-
tion of their countries’ corporate sectors.
Governments’ state spending also may account for more than one-​third
of an economy’s total gross domestic product; government spending in the
United States, supposedly a free-​market bastion, now accounts for more than
forty percent of GDP. But this government spending is primarily used for
social welfare programs (particularly in Western Europe and Japan), as well
as for defense; little of it is actually used to own and control corporations.
Although social welfare programs, defense programs, and other types of state
spending can give a government significant influence over the economy—​
higher defense spending sparks a range of flourishing defense-​related indus-
tries that are highly dependent on government contracts, for example—​these
types of state influence are far more indirect than in the state capitalists, where
the government simply owns controlling stakes of large companies.
In addition to the distinction between state ownership of companies
and just state spending, and the distinction between state ownership of a
handful of corporations below the one-​third threshold, there is another
important difference between the state capitalists and other countries.
Most Western governments are willing, during times of severe economic
crisis, to use government money to support and even wholly nationalize
 The State Is Back in Business          11

major companies—​a strategy that could, in theory, lead to Western coun-

tries owning more than one-​third of the corporate sector, although this has
not happened in recent economic crises. But Western governments gener-
ally do not view such nationalist strategies as long-​term policy solutions but
rather as emergency measures. This was true even during the height of the
2008–​2009 global financial and economic crisis, or even during the Great
Depression of the 1930s. After an economic crisis passes, governments in
most free-​market-​oriented nations usually withdraw state support for or
outright ownership of troubled companies and banks, tighten up monetary
policy, and again take a back seat to private industry.17
By contrast, in today’s state capitalist economies, leaders usually view in-
tervention in the economy and control of major companies not as temporary
fixes but as central to long-​term government policy and economic success.
The 2008–​2009 global economic crisis even sped up state intervention in
many developing nations, but modern state capitalism was not born in the
crisis. Its roots, as we will see, date back to the early 1990s.
Both the earlier mercantilists and the Soviet Union and Eastern Bloc
states basically saw international trade and economic growth as zero-​sum,
and believed that the state had to control a country’s economy completely,
either through government directly or through the monarch’s personal
grants to trading companies. The new state capitalists are not returning
their nations to the failures of autarky and communism; they have com-
bined a high degree of state control of major companies with a degree of
openness to global trade, as long as that trade does not threaten state con-
trol over certain key industries.
The new state capitalists have in fact opened their economies to some
extent and generally embraced free trade, even allowing some of their state-​
controlled enterprises to trade some shares on domestic or international
stock markets, though the shares are never enough to allow any outsiders
to actually gain control of the companies. In general, the state capitalists
today are far more integrated into the global economy than similarly inter-
ventionist states were during the Cold War or even the early post-​Cold War
period. Unlike previous state capitalists such as the Soviet Union or even
the highly interventionist governments in postcolonial states like India,
Indonesia, and Brazil during the Cold War, today’s state capitalists gener-
ally accept that they cannot succeed by erecting such high barriers to trade
that they isolate themselves. Some of the modern state capitalists, in fact—​
Singapore and Malaysia come to mind—​are important pillars of the world
12         State Capitalism

trading system, generally follow its rules, and—​in the case of Singapore—​
have been leading advocates for expanding free trade globally and in Asia.
Throughout this book, I also contrast state-​owned companies with
private-​sector companies. By private, I do not mean privately held—​I simply
mean companies that are not owned by the state. The companies I call pri-
vate throughout could be publicly traded companies, like technology giants
Apple or Microsoft, or they could not be publicly traded, like agricultural
giant Cargill Incorporated or many other smaller firms, which are normally
thought of as privately held entities. All these private-​sector companies may
receive incentives from states, such as tax credits, loopholes in legislation
designed to benefit them, access to government contracts, and other incen-
tives; they also may lobby governments to win business and alter legislation
tilted in their favor. However, unlike state-​owned firms, these private-​sector
firms are run by executives and boards that make decisions far less influ-
enced by policymakers than state-​controlled or state-​linked companies. To
be sure, the state capitalists’ SOEs resemble private multinationals in many
ways: they often use modern management techniques similar to any multi-
national giant, frequently have incentives to be as profitable as possible, and
sometimes fire managers who do not produce profitability.18 But ultimately
the state companies are influenced by government far more directly, and
thoroughly, than any private multinational would be.
Although I define the state capitalists today by their ownership of such
a large percentages of their countries’ corporate sectors, I also will briefly
examine some of the other ways in which state capitalists seek to control
and direct their economies. I will at times examine levers of economic con-
trol such as state spending on infrastructure, state social welfare spending,
and strategies to use state-​owned banks to pursuing lending strategies
to companies in industries deemed strategic by the state. Sometimes the
companies receiving these loans are state companies; in some cases, they
are not state companies. Still, I only examine these other economic tools if
they are utilized to assist state companies, as in the case of much of the bank
lending and infrastructure spending designed to favor state companies, or
if they are utilized in a way that gives the government de facto control over
a technically private company. For example, as has happened many times
in Thailand or Brazil, that technically private company becomes so depen-
dent on state lending or support that it winds up taking direction from
the government, such as allowing the government to pick the company
 The State Is Back in Business          13

directors and other executive leadership, and to determine the company’s

long-​term and short-​term corporate strategies.
Of course, many countries spend money on social welfare or infra-
structure or even on some incentives to promote strategic industries, to
pick three examples. But not all states do so to foster state companies or to
gain control of technically private companies. In state capitalists like China,
the government views infrastructure investment as useful for two reasons—​
actually improving the quality of the country’s physical infrastructure and
bolstering state companies that are usually given infrastructure projects,
often with little competition. So, I do not examine the many examples of
governments spending money to promote industries or concepts but not to
control companies—​American or Canadian tax incentives for companies
to invest in certain types of renewable energy these governments consider
strategic, for instance.
Neither do I examine in great detail the sovereign wealth funds
(SWFs)—​state-​owned investment vehicles like the Abu Dhabi Investment
Authority or the China Investment Corporation—​that have amassed some
of the largest pools of capital of any funds in the world. Although these
state-​owned funds are important players in the modern international
economy, and although I briefly discuss the funds, in the context of how
they help support state-​owned companies and work together with state
development banks, I do not examine the SWFs in great detail in order to
keep the scope of this book focused on state companies and the broader
impact of state capitalism on global economics and security. The devel-
opment of SWFs is the focus of many highly technical books that only
examine the SWFs, and do so in much more detail than I could ever mus-
ter. Many SWFs also have been around for decades, giving scholars much
more time to study them.
What’s more, although the size and number of state funds has grown in
the past decade, I do not believe their emergence poses the kind of challenge
to liberal economics and politics that state capitalism, via state companies,
could pose. There is less to distinguish SWFs from other types of invest-
ment vehicles—​hedge funds, for example—​than there is to distinguish
state-​owned companies from their free-​market multinational competitors.
Many of the SWFs have more transparency than state companies, and most
of the SWFs operate within similar boundaries and norms as privately held
investment vehicles like hedge funds.
 Rank Country GDP (Millions Rank Country GDP (Millions
of US Dollars) of US Dollars)

1 United States 17,348,075 31 United Arab 399,451

Emirates
2 China 10,356,508 32 Colombia 377,867
3 Japan 4,602,367 33 South Africa 350,082
4 Germany 3,874,437 34 Denmark 342,362
5 United Kingdom 2,950,039 35 Malaysia 338,108
6 France 2,833,687 36 Singapore 307,872
7 Brazil 2,346,583 37 Israel 305,673
8 Italy 2,147,744 38 Hong Kong 290,896
9 India 2,051,228 39 Egypt 286,435
10 Russia 1,860,598 40 Philippines 284,618
11 Canada 1,785,387 41 Finland 272,649
12 Australia 1,442,722 42 Chile 258,017
13 South Korea 1,410,383 43 Ireland 250,814
14 Spain 1,406,538 44 Pakistan 246,849
15 Mexico 1,291,062 45 Greece 237,970
16 Indonesia 888,648 46 Portugal 229,948
17 Netherlands 880,716 47 Iraq 223,508
18 Turkey 798,332 48 Kazakhstan 216,036
19 Saudi Arabia 746,248 49 Algeria 213,518
20 Switzerland 703,852 50 Qatar 210,109
21 Nigeria 573,999 51 Venezuela 206,252
22 Sweden 570,591 52 Czech Republic 205,270
23 Poland 547,894 53 Peru 202,642
24 Argentina 543,061 54 Romania 199,093
25 Belgium 534,230 55 New Zealand 197,502
26 Taiwan 529,597 56 Vietnam 185,897
27 Norway 499,817 57 Bangladesh 183,824
28 Austria 437,582 58 Kuwait 172,608
29 Iran 416,490 59 Hungary 136,989
30 Thailand 404,824 60 Ukraine 130,660

Figure 1.1.╇ Biggest Economies in the World, with the State Capitalists in Bold.
Data: International Monetary Fund statistics, author’s research.
 The State Is Back in Business↜渀屮↜渀屮↜渀屮↜渀屮╅ 15

STATE CAPITALISM IS GROWING

How do we know that state capitalism has expanded over the past two
decades, and why does this growth in state capitalism matter so much—╉to
the global economy, to global security, and to the United States itself? For
one thing, the number of countries where the state controls more than one-╉
third of the largest companies has steadily risen from its low point in the late
1990s—╉during the height of post-╉Cold War privatizations of former com-
munist countries and other developing nations in Africa, Latin America,
Asia, and Eastern Europe. In addition, global economic surveys show that
state intervention in economies has increased over this time period, par-
ticularly among the countries above the one-╉third threshold. Several of
the annual ratings surveys that analyze the state of economic freedom in
the world agree that the growth of free-╉market capitalism has stalled and
reversed since the mid-╉2000s, in part because of the rise of state capitalism.
One of the two major international surveys of global economic freedom
and the growth or decline of free-╉market policies, conducted by Canada’s
Fraser Institute, examines the policies and institutions in each nation to see
how supportive they are of economic freedom and free markets—╉policies
and institutions like legal systems that provide for voluntary exchange con-
trolled by markets, property rights and protection from theft, freedom to
enter and compete in markets, freedom to trade internationally, regulation,
and government control of corporations. The Fraser Institute’s research
shows that average economic freedom has mostly stagnated since 2007, in
part because of the growth of state capitalism.19 Because of the rise of state
capitalism, central planning “has made a comeback,” particularly in devel-
oping regions of Asia and Latin America, the Fraser Institute notes.20
The second leading study of economic freedom and free markets in
the world, produced annually by Washington think tank the Heritage
Foundation, has had similar findings. The Heritage Foundation’s annual
Index of Economic Freedom uses categories like property rights, fiscal free-
dom, investment freedom, trade freedom, and business freedom to ana-
lyze the overall state of economic freedom in each nation and then compile
regional and global averages of economic freedom and adherence to free-╉
market economics. Although the Heritage Foundation is considered a rela-
tively conservative and partisan organization in dealing with domestic US
policy, its index is highly respected. In its most recent Index of Economic
16╅↜渀屮↜渀屮↜渀屮↜渀屮 State Capitalism

Freedom, Heritage found that the global advance toward economic free-
dom, which had taken off in the late 1990s and early 2000s, has essentially
stagnated.21 Global economic freedom has stagnated for most of the past five
years in the annual Index, in fact, in large part because of the growth of state
capitalism in the developing world, and particularly in the group of countries
identified here by the definition of state capitalism. Breaking the world down
by regions, the most recent Index showed that in most developing regions
of the world—╉Latin America, Asia, sub-╉Saharan Africa, the Middle East—╉
economic freedom regressed or stagnated and state intervention increased
the previous year, as it had, overall, since the latter half of the 2000s.22 The
ranking came out even before the Chinese government’s massive interven-
tion in China’s equity markets during the summer of 2015. In regional giant
Brazil, for example, the Index showed that economic freedom and free-╉
market capitalism regressed the previous year, as it had for several prior
years as well. “The state maintains an extensive presence in many sectors …
[and] there is substantial tolerance [among the public] for state meddling
in the economy,” the Index’s analysis of Brazil noted.23 Similarly, the Index’s
scores of economic freedom and free-╉market capitalism for regional powers
South Africa and Indonesia have slid year after year since the early 2000s,
again largely because of growing state capitalism in these countries. In
Indonesia, for instance, the Index noted that government spending has
increased repeatedly over the past ten years. This spending is partly on
new state outlays for stimulus measures and social welfare programs, and
partly on nationalizing or subsidizing formerly private companies. The
Indonesian government also is “introducing trade and investment barriers
that include limits on ownership of banks and mines and export taxes,” the
Index’s report on Indonesia noted.24 Indeed, executives from several foreign
resources companies operating in Indonesia said they found the business
climate more challenging there in the mid-╉2010s than at any time in two
decades, as the government erected new barriers to resource investment,
tried to renegotiate tax deals with foreign investors who had already sunk
capital into the country, and tore up bilateral investment treaties with a
range of countries, among other decisions.25
One might think that statist economic strategies would always prove
political winners, in any time period, since these policies could involve
massive government spending on popular programs like job creation initia-
tives or handouts to small businesses and/╉or the poor. Yet fifteen years ago,
politicians in large developing countries like Thailand and Brazil won major
 The State Is Back in Business↜渀屮↜渀屮↜渀屮↜渀屮╅ 17

elections or led massive popular movements while advocating slashing the

role of the state in the economy, cutting subsidies to state companies, bal-
ancing budgets so that the state did not run a primary deficit, and unleash-
ing market forces in many sectors of the economy.26
In addition, polling across developing countries reveals deteriorating
trust in free markets and free politics, and a growing interest in other, more
interventionist models. In annual surveys conducted in 2011, 2012, 2013,
and 2014, the polling firm GlobeScan and the BBC World Service together
polled people in twenty-╉two nations, including many developing nations.
In nearly every state polled, publics had deteriorating opinions of free-╉
market capitalism, with significant pluralities believing that free-╉market
capitalism was “fatally flawed and needed to be replaced” with some other
kind of economic model.27

THE STATE CAPITALISTS COULD SUCCEED … OR

THEY COULD BE ENORMOUS FAILURES

In some of the state capitalists, a combination of cheap state funding, po-

litical support for certain industries, and modern management techniques
has proven successful, at least in the short term; the longer-╉term economic
consequences, for these countries and for the world, could be significant.
Since the early 2000s, for example, Chinese firms, many of them state con-
trolled, have come to dominate global industries from high-╉end glass pro-
duction to telecommunications infrastructure to paper manufacturing to
cell phone chip production. China is projected to soon become the largest
economy in the world in total GDP at purchasing power parity, surpassing
the United States. (Purchasing power parity as a measure takes into account
the strength of each country’s currency.) As we will see, China’s growth is
not simply a result of a country with such a large population and entrepre-
neurial drive opening up to the world—╉China’s growth is due in significant
measure to its careful economic strategy, its relatively efficient state capi-
talism. This state capitalism poses significant possible long-╉term dangers—╉
to China’s ability to make further economic strides, to political reform in
China, to Chinese innovation, and to the region’s security. But China’s eco-
nomic strategy has played a role in its growth, though at the same time
Beijing has amassed significant amounts of debt. Overall, by the summer
of 2015, China’s economy had the highest debt to GDP ratio of any of the
18╅↜渀屮↜渀屮↜渀屮↜渀屮 State Capitalism

world’s ten largest economies. Although China has enormous cash reserves,
eventually the Chinese government will have to grapple with the country’s
debt, moving China to an economic model somewhat less dependent on
state spending and on exports. Still, even with this debt load, and with a
severe downturn in China’s stock markets, the country managed to grow
by over 6 percent in 2015, a far higher figure than nearly every other major
economy. Job growth, consumer spending, and other important indicators
of economic health in China remained relatively robust. By the end of 2015,
even China’s stock exchanges were rallying once again.
Despite some scholars’ arguments that no country’s growth trajectory
can compare to China’s, China is not so unique, and the ability of some state
capitalists to use state intervention to promote growth and innovation is
another reason to examine modern state capitalism in detail. For example,
in many industries controlled in part by Brasilia, Brazil now boasts world-╉
beaters. Yet as we will see, at the same time, Brasilia’s control has caused
serious conflicts of interest and facilitated graft, and eventually led to a
dramatic slowdown in the Brazilian economy and fears that Brazil might
return to the cycles of recession and hyperinflation that it faced in previous
decades. While China faced a near collapse in its equity markets in mid-╉
2015, Brazil’s government was rocked by a series of corruption scandals
at some of the largest state enterprises; the chief of staff of Brazil’s former
president, Luiz Ignacio Lula da Silva, was charged with corruption, and the
treasurer of Lula’s party and a prominent senator from the ruling party were
charged with corruption as well.28 The chairman of Petrobras, the giant state
oil company, stepped down in the midst of the corruption scandals. But
the Brazilian government also has used its power to fund innovative com-
panies that otherwise might have been unable to raise capital, and to nur-
ture these firms until they grew large enough to compete domestically and
internationally.
Three decades ago, the Brazilian government gave aircraft manufac-
turer Embraer lucrative contracts and other subsidies, seeing that it could
potentially find a niche in smaller, regional aircraft that would not have
to compete directly with giants Boeing and Airbus. Private investors were
dubious, at first, of Embraer’s chances, and with only private investment
and a focus on short-╉term profits, the company probably would have failed,
as did nearly every other regional jet maker in the world during the 1970s
and 1980s. Instead, Embraer increasingly flourished, refining regional
jet technology, and now is the world’s biggest producer of regional jets.29
 The State Is Back in Business↜渀屮↜渀屮↜渀屮↜渀屮╅ 19

Although the Brazilian government still retains some control over Embraer
by owning a percentage of Embraer shares, the company has now held sev-
eral successful public share offerings.

WHY IS STATE CAPITALISM SPREADING TODAY?

There are several reasons why the world entered a new era of state cap-
italism, and we will discuss the reasons for state capitalism’s emergence
today at length in Chapter 4. For one, across the developing world over
the past decade, the first and second generations of elected leaders have,
with some exceptions, proven to be almost as autocratic as the autocrats
they replaced. Elected leaders such as former president Hugo Chavez of
Venezuela, President Jacob Zuma of South Africa, or Prime Minister Najib
tun Razak of Malaysia, often have turned into a kind of elected autocrat,
believing that one need only win elections, after which one can use power
to destroy the rule of law, judiciary, loyal opposition, independent bureau-
cracy, and other checks and balances that comprise the constitutional ele-
ments of democracy. These elected autocrats have not taken their nations
back to the harshest types of authoritarian rule, similar to the Soviet Union
or Mao’s China. And even in countries that have not made the transition to
democracy, like China, new generations of leaders, unlike the totalitarian
dictators of the twentieth century, cannot keep themselves in power only
through repression. Instead, both the elected autocrats and even the leaders
of modern authoritarian societies like China or Vietnam rely on mild
(compared to the twentieth century’s autocrats) repression combined with
producing strong economic growth to retain their popularity and support
their own legitimacy. Yet precisely because these new leaders—╉whether
elected autocrats or actual autocrats (as in China) dependent to some degree
on public support—╉are not true democrats, they desire growth that makes
their nations internationally competitive but also buttresses their own legit-
imacy and political power. The ideal type of growth, then, for these leaders
is modern state capitalism. When successful, this model is a type of capi-
talism that opens economies to the world enough to build trade surpluses,
keeps growth high enough to absorb labor market entrants, strengthens
leading industries, and promotes innovation, but simultaneously makes the
government more dominant over the economy and, potentially, the polit-
ical system.
20         State Capitalism

At the same time as the rise of these elected autocrats and modern au-
thoritarians, other international trends have combined to cause developing
nations to question the wisdom of free-​market, neoliberal economics, even
after challenges to more statist economies like Brazil’s and China’s emerged
in the middle of the 2010s. The Western financial crisis of the late 2000s
dented the “Washington Consensus” idea that a combination of free-​market
economics and free politics is necessarily the wisest course for developing
nations.
The failings of the Washington Consensus had many reverberations.
In my previous book, Democracy in Retreat: The Revolt of the Middle Class
and the Worldwide Decline in Representative Government, I chronicled
how leaders in young post-​Cold War democracies, and their advocates in
the West, too often oversold democracy in the immediate post-​Cold War
period as an immediate panacea for the economy, suggesting that democ-
ratization also would bring rapid growth. When democratic change did not
necessarily bring strong growth—​economies in places like the Eastern Bloc,
Africa, and Latin America struggled while democratizing in the 1990s—​
many publics soured on the notion of democracy itself. This souring had
many effects: decreased public participation in politics; nostalgia for pre-
vious authoritarian eras; the rise of elected autocrats; increasingly poisoned,
violent election campaigns; and sometimes an outright return to autocracy,
whether through a coup or some other extra-​constitutional means, like
violent street protests that, as in Ukraine or Thailand, force leaders to
give up office or even precipitate a military intervention in politics. In
Thailand, for example, studies by researchers at the Johns Hopkins School
of Advanced International Studies showed that over an eleven-​year period
between 2000 and 2011, Thais’ support for democracy became noticeably
weaker, while “authoritarian attitudes [i.e., support for authoritarian rule]
became stronger.”30
But the Washington Consensus’s failings did not reverberate only in
the ways I analyzed in Democracy in Retreat. Disillusionment with the
Washington Consensus model goes back more than a decade in the devel-
oping world, as the first post-​Cold War years did not produce the kind of
growth and equality people in many developing nations had hoped for.
In some countries, such as Kenya, Hungary, or Nigeria, publics soured
on democracy, but they still generally held to a belief in free-​market eco-
nomics. In other places, like Russia, the West’s economic failings inspired
Another random document with
no related content on Scribd:
 Akto V.
Sceno 1.—Antaŭ la grotĉambro de Prospero.
(Venas Prospero magie vestita, kaj Arielo).
Prospero.
Nun mia plano venas al finiĝo.
Spiritoj magipove min obeis
Oportunege. Horo nun kioma?
Arielo.
La sesa proksimiĝas. Vi promesis
Ke tiam ĉesos nia laborado.
Prospero.
Promeson mian certe mi plenumos,
Ĉar bone vi min servis. Diru kien
La Reĝon kaj sekvantojn vi kondukis.
Arielo.
Sub l’ ombrodona via tiliaro,
Malliberuloj, kune ili staras
Terure timigitaj; en la stato
Por ilin puni de vi preparita,
Ne povas ili ŝanĝi ĝis vi volos.
La Reĝo, lia frato, kaj la via
Triope staras strange konsternitaj,
Dum la ceteraj ploras apud ili,—
Precipe l’ bona maljunul’ Gonzalo,
Sur kies blankan barbon larmoj falas
Simile al malvarmaj vintraj gutoj
De kana tegmentrando. Via povo
Ĉagrenas ilin nun interne tiel
Ke ilin vidi tuŝus vian koron.
Prospero.
Ĉu vi, spirito, tion vere pensas?
Arielo.
Min tuŝus tio se mi estus homa.
Prospero.
Min tuŝu ĝi do, ĉar mi homo estas.
Ĉu vi, aero nur, kompatas homojn,
Dum, similul’ ilia, mi ne sentos
Pli ol vi kompatema?—Kiel ili
Ĉu ĝojon, ĉu ĉagrenon mi ne havas?
Malbone kvankam ili kun mi agis,
Kaj vundis min profunde, mi forpelos
Koleron mian propran: grandanimo
Ol venĝo estas virto pli laŭdinda.
Pentantajn ilin povas mi pardoni,
Eĉ sen sulkiĝo. Iru, Arielo,
Kaj ilin liberigu. Magiaĵon
Tuj rompos mi, al ĉiu por redoni
Sentemon ĝustan.
Arielo.
Tuj mi iros, Mastro. (Foriras).
Prospero.
Koboldoj riveretaj kaj montetaj,
Lagamistetoj, arbarvizitistoj;
Vi, sur la sablo kiuj l’ ondon sekvas,
Kaj ride antaŭkuras for l’ alfluon;
Duonestaĵoj, kiuj sub la luno,
Elfaras la maldolĉajn herbrondaĵojn
Maĉeblajn tute ne de la ŝafino;
Vi, fungfaristoj, kiuj nokte ludas,
Kaj ĝoje aŭdas vespersonoradon—
Per vi, malfortaj kvankam estaĵetoj,
Tagmezan povis mi nubigi sunon,
Eĉ leviĝigi ventojn ribelantajn,
Eĉ verdan maron kun ĉielo blua
Interbatigi muĝe; mi fulmigis
Tra laŭtkrakanta tondro; fajre fendis
La Jupiteran kverkon per difulmo.
Mi skuis promontoran fundamenton,
Elradikigis cedron kaj pinarbon;
Eĉ tomboj vekis siajn endormantojn
Kaj malfermiĝis ilin por forsendi,
Per mira povo mia.—Sed nun ĉesu
La magiarto, de mi forĵurita;
Ĉar, poste iom da muziko dolĉa,
(Tuj de mi dezirata por ke baldaŭ
Pentuloj sentojn siajn ree havu)
Korege rompos mi bastonon mian
Kaj teren ĝin enfosos multajn futojn,
Kaj, pli profunde eĉ ol ajn sondilon,
La libron mi dronigos!
(Solena Muziko).
(Revenas Arielo; lin sekvas Alonzo kun freneza mieno, kune
kun Gonzalo; Sebastiano kaj Antonio, sammaniere, kune
kun Adriano kaj Francisko.—Ili ĉiuj enpaŝis la rondon, kiun
Prospero estis antaŭpretiginta: tie ili staras magie senmovaj;
tion vidante, Prospero parolas:)
Ari’ solena, taŭga kuracado,
Nun senutilan vian tutan cerbon
Rekonsciigu, en kranio via:
Cetere vi en magipovo staras.—
Gonzalo! virta, honorinda viro,
Okuloj miaj simpatie ploras
Kun viaj; falas de mi frataj larmoj . . .
—Magio nun rapide malaperos,
Kaj, kiel la maten’ svenigas nokton,
Iliaj sentoj la nebulan staton
Forigos tuj, kaj ree sin ekvekos.—
Gonzalo! bona vir’, savinto mia,
Subul’ al via Reĝo tre fidela,
Noblanimulo, estos viaj servoj
Pagitaj hejme, voĉe, kaj per agoj!
Alonzo, tre kruele vi agadis
Kun mi kaj kara infanino mia,
Kaj tiu via frato krime helpis,—
—Sebastian’ interne tion sentas—
Eĉ vi, ho frato! karno, sango mia,
Mortigis, ambicie, natursentojn,
Sebastianon puŝis al perfido . . .
—Duoble li pro tio nun suferas!—
La Reĝon ambaŭ vi mortigi volus . . .
Sed al vi mi pardonas, Antonio.
—Ilia komprenado ekrevenas:
Idealfluo sane replenigos
Pensrandon magiŝlime nun kovritan.
El ili tamen min neniu konus,
Eĉ se min ili vidus.—Arielo,
Alportu mian glavon kaj ĉapelon.
(Foriras Arielo).
Nun tute magiveston mi deprenu,
Kaj kiel dukon de Milan’ min montru.
(Al Arielo kiu revenas kaj helpas vesti lin).
Spirit’, rapidu! Vi tuj liberiĝos!
Arielo kantas:
Ĉe l’ abel’ kunsuĉos mi,
En primolo kuŝos ni,
Tie ni ripozos, dum
La strigo vokos en mallum’.
Sur vesperto rajdos mi
 Post la somer’, gaje, ho!
Gaje tre! gaje, ho! vivos mi nun,
Sub arba flor’ varmigata de l’ sun’.
Gaje, ho! vivos mi, gaje tre, nun,
Varmigos min la brila sun’,
Sub arba floro mi vivos nun!
Prospero.
Ĉarmege! Al mi, Ariel’, vi mankos;
Sed vi libera estos aerido.
Ĉi tien de la Reĝa ŝip’ venigu
Ŝipestron kaj subestron ĉiam viglajn,
Maristojn ankaŭ sub ferdek’ dormantajn.
Tuj iru.
Arielo.
Mastro, mi l’ aeron glutos:
Eĉ antaŭ du pulsbatoj mi revenos.
(Foriras Arielo).
Gonzalo.
Turmento, peno, miro kaj mirego
Ĉi tie loĝas: ke ĉiela povo
Konduku nin el la insul’ terura!
Prospero.
La suferintan dukon de Milano,
Prosperon, nun rigardu, moŝta Reĝo!
Por pli ĉertigi ke vivanto princa
Al vi parolas, mi vin ĉirkaŭprenas:
Ĉar al vi kaj sekvantoj mi deziras
Bonvenon, kore!
Alonzo.
Ĉu Prosper’ vi estas,
Aŭ sorĉapero por min malinformi,
Ne povus nun mi diri: via pulso
Tre home batas certe: mi ekpensas
Ke, de l’ intervidiĝo nia lasta
Ĝis nun, posedas min frenezo ia. . . .
Ĉu ne postulas ĉio ĉi klarigon,
Rakonton strangan?—La dukecon vian
Forlasas mi, de vi nun peteganto!
Pardonu mian kulpon!—Sed, Prospero!
Ĉi tie kiel staras li—kaj vivas?
Prospero.
Unue, nobla maljunul’ Gonzalo,
Ke mi vin respektege ĉirkaŭprenu:
Honoro via estas netaksebla,
Eĉ senegala.
Gonzalo.
Ĉu ĉi tio estas?
Ĉu ne? Mi ne komprenas. . . .
Prospero.
Strangaĵecon
Insulnaskitan, vi ankoraŭ sentas;
Ĝi ne permesas al vi veron vidi.
Bonvenon koran al amikoj miaj!—
(Flanken al Sebastiano kaj Antonio).
Se tamen volus mi, kortega paro,
Malkaŝi perfidaĵon vian, vere
Sur vin sulkiĝus tuj la Reĝa brovo;
Sed mi silentos.
Sebastiano (flanken).
Li diable prava!
Prospero (al Antonio).
Vi, malbonulo, kiun frato’ nomi
Eĉ buŝon malpurigus, mi pardonas
Kulpegojn viajn tute, postulante
Ke al mi tuj duklandon vi redonu—
Sed tion nepre vi devige faros—
Alonzo.
Se estas vi Prosper’, al ni rakontu
Detale vian ĝis nun konserviĝon;
Klarigu tiun ĉi interrenkonton—
Ĉar de tri horoj nur, ni marirante
Suferis ŝippereon sur ŝtonbordo,
Kaj tie mi (kruela penso!) perdis
Karegan filon!
Prospero.
Tre mi vin kompatas!
Alonzo.
Neriparebla perdo! Pacienco
Kuraci ĝin ne povas.
Prospero.
Sed mi pensas
Ke vi ne tute petas ĝian helpon:
Al mi, por sama perdo, pacienco
Fariĝas kontenteco konsolanta.
Alonzo.
Ĉu vi ĵus dirus, “sama perdo”?
Prospero.
Sama,
Kaj ankaŭ tute nova. Elportebla
Por fari ĝin mi havas nur rimedojn
Ol viaj pli malfortajn, ĉar filinon
Ne antaŭ longe perdis mi.
 Alonzo.
Filinon?
Ĉielo! kial, Reĝo kaj Reĝino,
En Neapolo nun ne estas ili?
Por okazigi tion, tre volonte,
Anstataŭ filo mia, sur marfundo
Mi kore enŝlimiĝus. Nu, filinon,
Ŝin kiam perdis vi?
Prospero.
En la Ventego,
Samtempe kiam vi la filon perdis.
Mi vidas ke tre miras vi, sinjoroj,
Pri tiu ĉi okaz’; vi preskaŭ dubas
L’ ateston de okuloj kaj oreloj;
Sed, kiel ajn vi provizore perdis
De l’ sentoj uzon, sciu nun ke certe
Prosper’ mi estas, mi la rajta duko,
Mi, kiu, forpelita el Milano
Atingis poste la insulon kies
Ĉefviro estas mi, sur kies bordo
Okazis via propra ŝippereo.
Sed tian ĉiutagan historion
Nek povus mi rakonti en kunsido,
Nek dum tagmanĝo. Nu! bonvenon, Reĝo,
Al la grotĉambro nur kortego mia.
Interne sekvantar’ nenia staras,
Ekstere ne subuloj: nun, rigardu!
Tuj, pro duklando kiun vi redonas,
Mi pagos vin per multa plibonaĵo:
Almenaŭ kontentigos vin la vido
Eĉ pli ol min duklando.
(La grotĉambro malfermiĝas kaj montras Ferdinandon kaj
Mirandon ŝakludantajn).
Mirando.
 Vi friponas,
Karulo—
Ferdinando.
Ne, amata koro mia,
Por tuta mond’ ne volus mi falsludi.
Mirando.
Falsludi povus vi, por dudek regnoj,
Eĉ tiam dirus mi ke vi bonludas.
Alonzo.
Se estas tio nur insulapero
Karegan filon mi dufoje perdos.
Sebastiano.
Mirakl’ altega!
Ferdinando.
Kvankam muĝas l’ ondoj,
Kompaton havis ili: mi neprave
Malbenis ilin.
(Genufleksas al Alonzo).
Alonzo.
Ke plenkoraj benoj
De ĝoja patro vin ĉirkaŭu tute:
Leviĝu. Kiel vi ĉi tien venis?
Mirando.
Ho! miro! kiom da kreitoj belaj
Nun staras tie ĉi! homaro nobla!
Belega, nova!
Prospero.
Nova por vi, kara.
 Alonzo (al Ferdinando).
Ŝin, kiu kun vi ĵus interŝakludis,
Al mi konigu—kvankam reciproke
Nur estas vi trihoraj gekonatoj—
Ĉu estas ŝi diin’ nin disiginta
Por nin reunuigi?
Ferdinando.
Ne, sinjoro;
Mortema ŝi; sed, per nemorta Povo,
Ŝi mia estas, de mi elektita
En tempo, kiam nek de vi permeson
Mi peti povis, nek vin pensis viva;
Filino de Milana fama duko—
—Tre ofte jam lin aŭdis mi laŭdatan,
De mi, ĝis nun, lin tamen nekonatan—
De kiu novan vivon mi ricevis:
Per kara fianĉino li fariĝas
Nun dua patro mia.
Alonzo.
Patro ŝia
Fariĝas mi.—Sed kiel strange ŝajnas
Pardonon peti de l’ infano mia!
Prospero.
Sinjoro, haltu tie: ni ne ŝarĝu
Memoron nian per la malbonaĵo
Feliĉe nun pasinta.
Gonzalo.
Mi interne
Ĵus tiel ĝoje ploris, ke pli frue
Ne povis mi paroli . . . Dioj povaj!
Rigardu, benu per duobla krono
Geprincojn niajn! Ĉar vi markis vojon
Por la interrenkonto!
Alonzo.
Amen! Estu!
Gonzalo.
Ĉu el Milan’ Prospero forpeliĝis
Por ke l’ idaro lia reĝe sidu
Sur Neapola trono? Estu ĝojaj!
Plej ĝojaj kiel eble! Tion skribu
En orleteroj sur kolonoj daŭraj.
Vojaĝo mira! edzon en Tuniso
Akiris Klaribel’; per ŝippereo
Edzinon ŝia frato Ferdinando
Feliĉe trovis; eĉ Prosper’ duklandon,
Kaj ĉiu el ni sin mem—jam perditan—
En insulet’ retrovas.
Alonzo (al Ferdinando kaj Mirando).
Viajn manojn
Al mi nun donu: doloriĝu koro
Ne deziranta al vi ĝojon.
Gonzalo.
Amen!
(Revenas Arielo kun ŝipestro kaj subestro tute miregante
sekvantaj lin).
Sinjoro! nun rigardu, el ni vivas
Pli multaj ol eĉ povus ni esperi!
Ĉu en la ŝipo mi ne antaŭdiris
Ke tia maltaŭgulo ne droniĝos
Se estas pendigilo apud bordo?
Marblasfemulo, tute vi silentas:
Ĉu landnovaĵon vi ne povas ĵuri?
Subestro.
Ke ni revidas Reĝon kaj sekvantojn,
Novaĵo la plej bona certe estas:
Nur tri sabloŝutiloj malpleniĝis
De l’ ŝipfendiĝo ĝis la nunminuto,
Sed, tute ŝnurarmita, nia ŝipo
Nun estas bele taŭga por mariri,
Kaj tia kia ĝi antaŭe estis.
Arielo (flanken al Prospero).
Sinjoro, mi plenumis tiun servon
Dum forestado mia.
Prospero (flanken al Arielo).
Mirestaĵo!
Alonzo.
Okazoj tiaj ne naturaj estas:
Eĉ ili pli kaj pli strangiĝas. Diru,
Ĉi tien kiel ambaŭ el vi venis?
Subestro.
Sinjoro, se mi nun ne malspritiĝos
Volonte al Vi mi sciigos tion . . .
Ni ĉiuj morte sentis nin dormemaj,
Kaj sub ferdek’ kuŝantaj . . . Bruegaĵo
Katena, bleka, muĝa, kaj kriega
El tiu loko nin terure vekis . . .
Liberaj tiam, ni mirege vidis
La reĝan, bonan, bravan ŝipon nian,
Ŝnuraĵigita kaj de nove taŭga.
Ŝipestro nia vigle, gaje kuris
Por ĝin rigardi—Sed, dum palpebrumo,
Nubiĝaj, sonĝe, ĉiujn ni forlasis . . .
Kaj tien ĉi veniĝis . . .
Arielo (flanken al Prospero).
Ĉu mi bone
Elfaris vian volon?
Prospero (flanken al Arielo).
Diligente!
Tuj estos vi libera!
Alonzo.
Labirinton
Similan viro ajn neniam paŝis;
Gvidil’ mirega, ol natur’ pli alta,
La tuton antaŭplanis. Orakolo
Nur povus ĝin klarigi.
Prospero.
Reĝa Moŝto,
Plu ne turmentu nun spiriton vian
Pri tiuj ĉi strangaĵoj . . . Libertempe.
Ne longe de nun, poste mi klarigos
Okazojn, kiujn eble vi aprobos:
Ĝis tiam, estu ĝoja, mi petegas.
(Flanken al Arielo) Spirito, venu: tuj nun liberigu
Eĉ Kalibanon kaj kunulojn liajn.
(Foriras Arielo).
Mi petas vin, ho Reĝo, kontentiĝu.
Ankoraŭ mankas kelke da sekvantoj,
Sed ilin vi kredeble ne memoras.
(Revenas Arielo enpuŝanta Kalibanon, Stefanon, kaj
Trinkulon, kiuj portas la ŝtelitan vestaĵon).
Stefano.
Ĉiu homo elturniĝu por la ceteraj, kaj neniu estu singardema, ĉar ĉio
estas nur ŝanco. Kuraĝe! monstregulo! kuraĝe!
Trinkulo.
Se kredindaj estas la spioniloj kiujn mi portas vizaĝe, jen estas bela
vidaĵo!
Kalibano.
Setebos! estas jen spiritoj gloraj!
Kaj kiel bela estas mia mastro!
Mi timas ke li min severe punos.
Sebastiano.
Ha, ha! sinjoro mia, Antonio,
Objektoj tiaj, diru, kiaj estas?
Ĉu aĉeteblaj?
Antonio.
Ili? Kompreneble,
Ĉar unu estas fiŝo, kaj vendebla.
Prospero.
La montron de la trio bone notu,
Sinjoroj. Ĉu honestaj ili ŝajnas?
De tiu malbelulo la patrino
Potenca sorĉistino tiel estis,
Ke ŝi la lunon povis eĉ kontroli,
Alfluon kaj forfluon vole fari,
Eĉ kontraŭ la lunpovo—Nun, triope,
Vestaĵon tiun ili de mi ŝtelis—
La duondiablido min mortigi,
Per helpo de kunuloj, jam intencis;
Du el maltaŭganaro vi mem konas:
Ĉi tiu mallumaĵo estas mia.
Kalibano.
Min morte pinĉos li!
Alonzo.
Kelisto mia,
Ĉu li drinkema estas ne Stefano?
 Sebastiano.
Ebria nun, li kie ŝtelis vinon?
Alonzo.
Trinkulo mem de vino ŝanceliĝas:
El kie prenis ili la likvoron
Maturiĝantan en la maltaŭguloj?
Peklaĵon tian kio kaŭzis? Diru!
Trinkulo.
De l’ tempo de mia lasta renkonto kun Vi, mi troviĝis en tia peklaĵo,
ke kredeble ĝi neniam foriros el miaj ostoj: mi ne timos
muŝovĝermiĝon!
Sebastiano.
Nu! kion vi diras, Stefano?
Stefano.
Ne tuŝu min! Mi jam ne estas Stefano, sed nur streĉego!
Prospero.
Vi volus esti Reĝo de l’ insulo?
Stefano.
Doloran Reĝon havus do l’ insulo.
Alonzo (montrante Kalibanon).
Strangaĵon tian mi ĝis nun ne vidis!
Prospero.
Malbonkonduta estas li, Sinjoro,
Eĉ tiel kiel estas li malbela—
Vi tri, tuj iru en grotĉambron mian
Kaj bele ĝin balau kaj ornamu,
Pardonon mian se vi gajni volas.
 Kalibano.
Mi certe volas. En la estonteco
Pli saĝa tute estos mi, kaj penos
Pardonon de la mastro por ricevi.
Ho triobleduobla mi azeno!
Por dio mi trinkulon tian prenis
Kaj malspritulon mi adoris!
Prospero.
Iru!
Alonzo.
For de ĉi tie kaj pakaĵon portu
Al ĝia loko—
Sebastiano.
Kie ĝin vi ŝtelis.
(Foriras Kalibano, Stefano, kaj Trinkulo).
Prospero.
Nun, Via Reĝa Moŝto, kaj sekvantoj,
Bonvolu tuj akcepti la gastamon
De simpla groto, kie vi ripozos
Ĉi tiun noktodaŭron. Tre rapide
La tempon ni pasigos: mi rakontos
Al vi la mian vivon, de l’ momento
En kiu la insulon mi atingis.
Matene morgaŭ vin mi kunkondukos
En vian ŝipon, poste Neapolon,
Ĉefurbon kie mi esperas vidi
De niaj gekaruloj la edziĝon,
Kaj fine, en Milano mia, vivos
Min pretiĝante por la tombo.
Alonzo.
Vere,
Mi tre deziras aŭdi la rakonton
De viaj aventuroj en l’ insulo:
Tre stranga devus esti.
Prospero.
Vi ĝin aŭdos:
Mi ĉion diros; mi al vi promesas
Kvietajn ondojn, tre facilajn ventojn,
Eĉ tian marveturon ke vi trafos
Ŝiparon vian kvankam malproksiman—
(Al Arielo) Vi, Arielo, tion tuj elfaros,
Birdeto kara, tiam, liberiĝu!
Adiaŭ, Ariel’!—(Al Alonzo kaj aliaj) Kun mi nun venu!
(Ĉiuj foriras).
 Epilogo
parolata de Prospero
Nun magio plu ne estas:
Sola mi malforta restas.
Dum tri horoj, estas vere
Ke vi agis ne severe
Kun mi, duko de Milano
Kiun timis Kalibano.
Kiam ĉiujn mi pardonis,
Al mi vi aprobon donis:
Spite je la uzurpulo
Me ne restos en l’ insulo.
Neapolon tuj nin sendu;
Ne prokrastu, ne atendu.
Kun remmanoj de aplaŭdo,
Ankaŭ kun voĉventa laŭdo,
Brave helpu nin elfari
Nian celon sen erari.
Se petanta mi eĉ pekos,
Mi pardonon en vi vekos.
Preĝu por ni, ho popolo!
Ke ĉi tie eĉ ne colo
De malamo sin vidigu,
Nin, gefratoj, liberigu.

1623-1903
Nubkronaj Turoj
Sesparta Kanto de R.J. Stevens
El “La Ventego”
Adagio ne troa.
Nub-kronaj turoj, kaj luksaj pa-lacoj solen-aj sankte-joj Eĉ la
granda terglobo kaj ĝi-a tuten-havo
kaj luksaj pa-lac-oj solen-aj sanktejoj Eĉ la granda ter-globo kaj
ĝi-a tuten-havo
Nub-kronaj turoj, kaj luksaj pa-lac-oj solen-aj sanktejoj Eĉ la
granda terglobo kaj ĝi-a tuten-havo

mala-peros, si-mile al lud-sceno ne substanca, Ne lasos ili

strekon, ian strekon lasos ne!
mala-peros, si-mile al lud-sceno ne substanca, ian strekon lasos
ne!
mala-peros, si-mile al lud-sceno ne substanca, ian strekon lasos
ne!