The Political Economy of Syria Under Asad.

This rigorous book relies essentially on a structural-functionalist framework that makes for tedious reading in an otherwise well researched work. According to the author, Syria's political economy demonstrates that crisis is inevitable in an authoritarian state trying to adapt to new domestic realities. Syria is a strong state with social forces and relations existing within a corporatist structure where economic transformation has been essentially a political affair with a large degree of Syrian independence in decision making.

Chapter One argues for the use of "class" as a concept to shed light on the infitah (opening to the West). But Perthes, still regards regionalism, tribalism and confessionalism as important.

Chapter Two discusses the development of the statist economy. The crisis of the 1980s (precipitated by import substitution industrialization in the 1970s) made economic reform imperative and was "a function of economic need, social change, and political structures" (p. 15). By 1970, Syria became a net importer of food stuffs, which eventually, along with industrialization and consumer goods imports, increased the trade deficit and developed a serious foreign exchange crisis. Despite its recently more diversified economy, Syria remains agrarian.

Asad's regime is not ideological; "socialist transformation" was abandoned and reliance on the socialist bloc reduced as the regime opened up to the West and to conservative Arab regimes. This first "infitah of abundance" (1971) liberalized through state-led growth; although banking, insurance, mining, oil, and manufacturing of strategic goods were off limits to the private sector. A mixed sector in tourism was created. By 1977, however, a deteriorating balance of payments forced some restrictions on the private sector. Import substitution industrialization (state-capitalist under Asad) continued in the 1970s; but its turnkey feature kept Syria dependent upon foreign expertise, raw material and parts.

By 1981, the economy shifted toward exports to solve the foreign exchange crisis. The second "infitah of poverty" has had four stages: (1) the private sector to secure and the state to increase the foreign exchange each needs; (2) currency devaluation and trade regime liberalization; (3) liberalization and encouragement of investment and private production; and (4) the ongoing liberalization of import regimes. The second infitah has resulted in private sector growth and increasing inequality in an economy incapable of creating a sufficient number of jobs.

Chapter Three analyzes the social structure. Perthes shows how land reform allowed the middle peasant to become the "leading class" in the countryside and develop common interests with the wealthy farmer and agricultural entrepreneur. The losers were the small peasant and agricultural worker. Despite higher output, agriculture stagnated because of the migration of many small peasants. Many in the urban working class are of rural origins. This class is weak politically even though it comprises 35 percent of the population. In the early 1990s, the average wage in the public sector covered only one-third of a worker's family expenses. Furthermore, private sector workers are employed in small enterprises where the labor code does not apply fully.

The semi-proletarians (the temporarily employed and vendors), comprising 15 percent of the population, lead a precarious existence that makes them potentially dangerous to the regime. The self-employed middle class is anti-regime and religiously conservative but poses no threat because a significant part of it has reached a modus vivendi with the regime. Most members of the wage-earning middle class, which comprises 17 percent of the population, are of rural origins. Perthes divides this class into: (1) the private sector managerial staff and high ranking civil servants; (2) the intermediate level that is not doing that well; and (3) public sector employees since 1980 and lower officials. The last two sectors are not that reliable for the regime.

The bourgeoisie have grown both in wealth and status under Asad but now comprise only one percent of the population. The "new class," the top layer of the commercial bourgeoisie, is dependent upon the state that affords it profit opportunities unparalleled in a "free market" environment. The bourgeoisie also comprise the remnants of the old class, the new industrialists, and the state bourgeoisie. Perthes concludes that the regime's social base has narrowed. But he cautions that no correlation exists between the regime's policies and its social base.

Nor does the class structure determine the social base; "... traditional social relations still play a considerable role, determining loyalty and structures and, to an extent, politics" (p. 122).

Chapter Four analyzes the increasingly corporatist political patrimonial, authoritarian structure. The bureaucracy has developed because of clientelism, corruption and the regime's need for political control. While technocratic-rational orientation exists, the main goal is to prevent the creation of independent power centers. Corruption is compounded by the security apparatus that employees 50 percent of state workers (15 percent of total workforce). In addition, the Ba'th Party, which operates as the regime's main patronage network, has been corrupted and is less important now than ever. The National Progressive Front parties have no power and little credibility. In addition, parliament has no control over politics or policies. It only has some control over administrative performance. Finally, none of the popular organizations has any real power, even though the trade unions and the peasant union are most important for the regime. In conclusion, Asad has maintained his regime through a strong state with weak institutions.

Chapter Five analyzes economic policies and political decision-making. Perthes opines that while external influences put limits on economic decision making, the design of such policies has remained Syrian. Aside from fear of losing control, the Syrian government has refused to give up its economic policy making role lest it jeopardize what remains of its nationalist credentials. Perthes' detailed discussion of ministerial and governmental committee work demonstrates that the goal is not efficiency but regime maintenance. It is for this reason that the style of economic policy formation is "gradualist, reactive and personalized, with some corporatist, consultative elements" (p. 265). But incentive is lacking in proactive decision making and long-term planning. Perthes, also believes that the positions of the party and the trade unions represent those of the state bourgeoisie who are suspicious of privatization.

Chapter Six concludes by examining prospects of political development, especially after Asad. Productive private investment would have benefited more were there no restrictions on the "free market." But the bourgeoisie are not interested in "free competition" so long as they have a profitable arrangement with the regime. Perthes also finds that no relationship exists between economic liberalization and political change and is not optimistic regarding the development of civil society. Under Asad the regime will continue to develop along corporatist lines. But Perthes sees two reasons for the development of a weaker state after Asad: (1) oil revenues and aid will stagnate; and (2) external threats and skilled leadership will disappear or weaken. Whether militarist or not, a new regime will accept market forces. Finally, in the long-term, although peace will be in everybody's interest, it is not in Syria's interest in the short-term.

Perthes' work suffers from serious problems. First, he makes the dubious distinction between "state socialism" (before 1970) and "state capitalism" under Asad. Yet he shows that corporatism has been building since 1963. One wonders whether it is possible to have "corporatism" and "state socialism" at the same time. Prompted by his concluding chapter, one is compelled to ask about the relationship between corporatism and capitalism, which he does not address. Does corporatism thrive in "state capitalism," which is a special form of capitalism? A brief discussion of the ideological connection might have revealed the relationship between the two concepts. Such a discussion would also make one doubt the existence of "state socialism" before 1970 under the Ba'th.

Secondly, Perthes' structural-functionalist framework limits him in considering the dynamics of popular organizations and how social and political forces operate within them. His critique is confined to the bureaucratic structures and their extensions in the popular organizations. This precludes real consideration of social movements: how they might arise; and what the various political organizations have been doing to mobilize and recruit within the popular organizations. Positivist meta-theoretical commitments prevent Perthes from seeing which class struggles, however rudimentary, operate in the system. Corporatism again rears its head and renders the situation murky.

Thirdly, structural-functionalist analysis has another equally serious problem: in discussing public-sector reform, Perthes does not deal sufficiently with the relationship between the bourgeoisie and the quasi-public or "mixed" companies. One wonders if these are cases of camouflaged privatization that a class analysis might have revealed? Finally, Perthes' pro-liberalization sentiments prevent him from evaluating privatization's consequences on Syria in a crisis-ridden global capitalist system.

Ibrahim G. Aoude is an associate professor in the Ethnic Studies Program, University of Hawaii at Manoa.