Until quite recently, it was common to observe that the one area in the capitalist world that was in a strong position to advance rapidly in the economic sphere without suffering the social and political strains experienced in the West was East Asia, where Japan and the so-called Little Tigers appeared able to combine rapid economic growth with a minimum of social problems and a considerable degree of political stability. Pundits in the region and abroad opined that the “East Asian miracle” was a product of the amalgamation of capitalist economic techniques and a value system inherited from Confucius that stressed hard work, frugality, and the subordination of the individual to the community—all reminiscent of the “Puritan ethic” of the early capitalist era in the West. There is indeed some similarity between the recent performance of many East Asian societies and early capitalism in the West. Some commentators in East Asia have pointed with pride to their traditional values and remarked that in the West such values as hard work and a habit of saving have been replaced by a certain hedonism that values individual over community interests and prizes gratification over future needs. Some observers in the West have agreed with this assessment and lamented the complacency and rampant materialism of Western culture. As the twentieth century neared its end, however, the argument suddenly became academic, as evidence accumulated that the East Asian miracle itself may be a myth or at least an overstatement of a more complex reality. The financial crisis of 1997 demonstrated that the Pacific nations were not immune to the vicissitudes of capitalism and that overconfidence and lack of attention to fundamentals could be as destructive on one side of the ocean as the other. Mesmerized by the rhetorical vision of the Confucian work ethic and less experienced in riding the choppy waves of the capitalist business cycle, Asian governments and entrepreneurs alike became too complacent in their view that the bull market in the region would never end. Banks extended loans on shaky projects, and governments invested heavily in expensive infrastructure improvements that exploded budget deficits while promising few financial returns until the distant future. When foreign investors grew wary and began withdrawing their funds, the bubble burst. It has been a sobering experience. As one commentator put it, “It was all too Disneyland; so much glass that was too shiny. Now they are going through a cultural crisis triggered by the economic crisis. These countries have to become more pragmatic.”1 It would be premature to conclude that the recent vision of a “Pacific century” will fade as surely as Khrushchev’s famous boast to Eisenhower four decades ago that “we will bury you.” The economic fundamentals in many East Asian countries are essentially sound, and the region will undoubtedly recover from the current crisis and resume the pace of steady growth that characterized its performance during the last quarter of the twentieth century. But the fiscal crisis of the late 1990s serves as a warning signal that success—in East Asia as in the West—is the product of hard work and can never be assumed.