As the European economy teeters on the verge of a second recession and the US recovery wobbles, Asia is brimming with optimism. For Asian triumphalists attending a recent conference in Thailand – “Reading the Signposts of a Changing Landscape” – the signs are big, clear and point to a happy future.

I’m less sure. The wording on many signposts is confused, with many pointing towards dead ends or quicksand. In the rush of exuberant expectations that Asia’s time has come, the continent could fall victim to what’s behind many failures in the history of the world – simple hubris.

The rise of Asia is not predetermined, just as the dominance of Western civilization for the past few hundred years was not preordained. The rise of European imperialism and then American hegemony was not simply due to economic power backed by military might. It was underpinned by innovative, even revolutionary thinking, about the primacy of the rule of law; the separation of church and state; the commitment to an empirical, scientific worldview; and all the institutions that brought about the modern state built on liberal democracy and market capitalism.

Much of the intellectual vigor propelling the West to supremacy is now spent. In its place is frustration that the old order is not working, with no vision as to what the new order should be.

So could Asia rise to the occasion and, in the intellectual vacuum, offer new solutions to bankrupt thinking? Is the continent capable of creative destruction of taboos and restrictive mindsets hobbling it during past centuries? Is Asia’s economic growth matched by equally vigorous intellectual innovation?

The regional landscape offers clues.

India, for example, has managed, despite numerous challenges, to remain the world’s largest practicing democracy. But the continuing clash and contradictions between tradition and modernity renders Indian political and social relations almost dysfunctional. And while Indian pride in its scientific, artistic and business achievements is justified, the continuing inability to lift millions of people out of abject poverty remains a sobering and hopefully not insurmountable challenge.

China, the other great and ancient civilization of Asia, is today to become the second most powerful economy in the world. Its government has, unlike India, lifted teeming masses from abject poverty. Private capitalism thrives alongside the more dominant state capitalism. But the absence of a dynamic civil society – unlike in India – and its opaque political structure, as so glaringly revealed by the Bo Xilai scandal, is possibly unsustainable.

India suffers from a lack of political consensus; China has too much of it. India has a surfeit of democracy and a deficit of economic equality; China has eradicated poverty, but suppressed democracy.

Indian thought leaders realize that democracy has not reduced inequality or improved the lives for most Indians. Chinese intellectuals recognize that the current systemic problems of political governance, glossed over by rapid economic growth, are unsustainable and brittle. But neither knows how to move forward beyond recognition of the need for drastic reform. Intellectual innovation and political power are not integrated.

Japan’s social cohesion stands in stark contrast against China and India, but that same homogeneity and social conservatism has left it stranded in genteel decline, with no new thinking to break the country out of its stifling insularity.

South Korea, Taiwan and Singapore are probably the best examples of societies which grew rapidly due what political scientists call “developmental authoritarianism” and have successfully transited to liberal democracy. But their models of development are not easily transplanted to larger, more diverse societies.

Southeast Asia has largely recovered from the debilitating financial crisis of the late 1990s, which nearly crippled its private sector and brought down its banks. But internal contradictions remain unresolved in Thailand, Malaysia and Indonesia and are, arguably, growing steadily.

While one can’t deny the real achievements of an ascendant Asian civilization, it’s difficult to accept the facile self-congratulations of the triumphalists who suggest that Asia’s success in this century is inevitable. Even those who believe fervently that Asia’s time has come cannot afford complacency. Asia requires diverse, innovative thought leadership if its economic rise will result in a sustainable, new paradigm for civilizational progress.

In particular, Asia needs to inculcate a virtuous cycle whereby business, political and social leaders interact to create new norms of economic, social and political behavior and values. One example is the dire need of a replacement for the highly individualistic, American form of capitalism which at its best, enormously rewards risk-taking, but at its worst, creates monstrous inequalities based on speculative gambling of other people’s money. Capitalism is not universally identical; it’s shaped by history and culture, resulting in the Scandinavian variant or the German model. The American model may not be broken, but after recent financial debacles, Asia should not blindly adopt it.

Asia needs to delve into its own history and culture for inspiration in creating an Asian variant of capitalism. One such source can be the webs of mutual obligations which serve as a common, recurring socio-ethical tradition of Asia. This communitarian characteristic of Asian culture can, if thoughtfully enhanced, nurtured and developed, replace the highly individualistic, Darwinian ethos of American capitalism. Communitarian capitalism can be an Asian form of ethical wealth creation, where the interests of the community of stakeholders in an enterprise – owners, employees, customers and suppliers and the larger community – would be a higher consideration than return on capital.

In other words, communitarian capitalism would be stakeholder-driven, not simply shareholder-driven.

One of the contradictions of globalization is the starkly worsening income inequalities across the world, particularly in Asia. There is no middle way, no waffling position where Asia’s elite claim credit for generating growth but deny responsibility for its negative consequences. Such waffling unfortunately, is what most Asian business leaders are doing today; hiding their heads under the sand, thinking that if they simply stick to what they’re good at doing – creating and consuming wealth – they are part of the invisible hand of productive capitalism. But that’s just not good enough because, as we’ve seen, unfettered capitalism is not an absolute good, and often businessmen deepen its imperfections.

History has shown how many institutions of a modern and progressive society, such as liberal democracy or universal suffrage, arose out of the demands of a rising business class – the bourgeoisie. Asia’s rising middle class needs to play the same historic role as their counterparts in Europe several hundred years ago.

Thought leadership need not be in grandiose or visionary ideas, but can small, practical solutions to real problems. For example, as a tiny country, Singapore has no pretensions of being a global thought leader. It has simply and quietly created solutions to its own set of changing circumstances, setting a model for others.

Singapore’s approach to social security and public housing, launched many decades ago, has been universally hailed as revolutionary. In the field of sustainable resource management for cities, Singapore is probably one of the leading world examples.

Across Asia, there are many more examples of innovative, inspiring thought leadership covering a spectrum of fields. But this is not enough. Asia needs fundamental paradigm shifts, particularly on political and business governance, if it’s to reach the vision of its future. Future generations will either blame or thank the present elite for what they do, or more disappointingly, choose not to do.

(Ho Kwon Ping is chairman of Singapore Management University and executive chairman of Banyan Tree Holdings.)