Reversing Policies on Rice and Opium Production

With the coming of socialism to our town, farmers were compelled to sell quotas of grain to the government buyers at a very low price. All the good-quality rice produced in Burma was reserved for export or (just as often) sold to the black market merchants. What was left -- rice of the poorest quality -- was then sold to the people. If farmers wanted to eat their own good-quality rice, they had to buy it from merchants at roughly ten times the price that they had been paid for it. As a result, farmers were reluctant to grow surplus rice for sale, preferring to grow only enough for their own families. When there was a bad harvest, they didn't even have enough to feed themselves. Burma, which was the world's biggest exporter of rice before the Second World War, became a net importer. Even leaving aside the flaws in the regime's agricultural policy, sheer mismanagement and rampant corruption began to undermine the economy as early as the mid-seventies. The price of food and domestic goods rose steadily, until inflation ran out of control. Even basic food needs were no longer met. Rice was unavailable at the official rate, and sky-high on the black market.

Some farmers illegally grew poppies in the jungle to support their families in bad years. When they discovered that opium made them much more money, with less effort, than normal crops, they grew more and more -- and eventually poppies outstripped rice and other grains. At first the government tried to eradicate the poppy fields, making use of helicopters, machine-guns, flame-throwers and other technical assistance provided by Western governments. But government officials soon realised that they could enrich themselves by becoming unofficial agents for opium warlords, and so would destroy only a few token fields. The weapons supplied by the West were turned instead on internal enemies of the regime. The alleged fight against drugs became an excuse to attack ethnic rebels and even villagers who showed any opposition towards the government. As a result, the opium trade boomed as never before.

SOURCE: From the Land of Green Ghosts: A Burmese Odyssey, by Pascal Khoo Thwe (HarperCollins, 2002), pp. 56-57

This pattern has been repeated so many times in so many countries that it has become a sad cliché. In order to reduce supplies of opium, the Burmese government should have encouraged farmers to grow it while forcing them to sell it to the government at artificially low prices. This always works so well with food crops. In order to increase food supplies, they just needed to stand aside and skim off (i.e., tax) the profits of growers and distributors. Results-driven policies are always superior to ones driven by ideology (pure intentions), as Deng Xiaoping recognized in the aphorism for which he will always remain famous, "It doesn't matter whether the cat is black or white, as long as it catches mice."

Unfortunately, Deng's other lasting legacy is his decision in 1989 to violently suppress the demonstrations in Tiananmen square, and the Burmese generals will leave the same mixed legacy, even if they decide to "free opposition leader Aung San Suu Kyi and invite the National League for Democracy to a May 17 constitutional convention" (as noted by Robert Tagorda).