Ethnic Politics and Economic Power

Abstract

This article describes and analyzes the political strategies by which ethnic majorities have successfully redressed the economic domination of an ethnic minority, but without despoiling the dominant minority or disrupting the economy. The cases to be examined and compared are biethnic structures -Quebec, Malaysia, and the hegemonic white society of South Africa. These strategies have been implemented in relatively democratic political systems and in an era characterized by extensive state intervention in economic affairs. Minority domination of the economy is often experienced in ethnic terms as the control of the levers of economic power by a minority ethnic community. When economic relationships are so perceived, governments which represent the economically disadvantaged ethnic majority usually act in one of two ways. They may take no specific action, fearing that any serious effort to reduce or eliminate economic imbalances would precipitate capital flight, deprive the country of needed skills, weaken and disrupt the economy, and thereby inflict even more damage on the majority than on the minority. In tolerating the economic subordination of their own constituents, such governments hope for the gradual rectification of ethnic imbalances through autonomous but unspecified economic processes.' In contrast to this policy of inaction, other governments determine to end minority economic doimination straightaway by such draconian measures as expropriation and nationalization of assets and even the expulsion of ethnic minorities. Such measures may but do not necessarily follow revolutionary struggles.2 A third, positive-sum strategy of ethnic redistribution with growth has been successfully implemented, with only minor variations, by the Afrikaner majority among South Africa's whites, by the Malay majority in Malaysia, and by the francophone majority in Quebec. A generation ago all of them were severely disadvantaged economically. Today in all three cases the economic gaps have been substantially narrowed and in some respects totally eliminated. The allocative machinery and police powers of the contemporary interventionist state have been put to use for explicitly ethnic economic objectives, to provide middle-class employment opportunities and acquire economic assets for the constituents of the new ethnic masters of the state and thus redress the original, unfavorable ethnic division of labor.3 Through a deliberate state-managed strategy, ethnic political power has been converted into ethnic economic power while avoiding expropriation and economic disruption. This article will explore the methods by which this economic transformation has been accomplished. After reviewing and analyzing each of these cases, I shall make some general statements about the methods that were employed, their political and economic consequences, and the conditions as well as the problems associated with the success of the strategy of redistribution with growth for redressing ethnic economic imbalances. As in any macropolitical comparative study, these cases are not identical. Quebec is a provincial unit within the Canadian federal polity; Afrikaners are a demographic majority among whites in