Using a New Federalism for Unity and Progress in Myanmar
David Dapice and Thomas Vallely, March 2013
When in 2010, the President of the Union of Myanmar, the Speaker of the Lower House and several ministers decided to push for a rapid political opening, they engineered what could be called a critical juncture. This critical juncture now provides the country with an opportunity to move forward, not only with faster economic growth, but also with better quality growth and political change that will unify the nation and create broad progress. In exploring a possible approach toward unity and progress, this paper uses the framework developed in Why Nations Fail, a recent book on economic and political development and also refers to the idea of “illiberal democracy“ articulated by Fareed Zakaria. The basic idea is that a broad coalition of the incumbent party, the democratic opposition, ethnic groups and the military is needed to fundamentally change Myanmar’s past failed orientation. This broad coalition should work for a new federalism in which states (at a minimum) have fairly elected governors and meaningful revenue sources so they can run many of their own affairs. Recognizing that central to real progress is a transition from a repressive, extractive and exclusive political system with crony businesses to a broadly inclusive political system that spreads economic opportunity, the paper argues that broad political and economic change need to go hand in hand.