Looking down from Kungachoeling Monastery through fluttering prayer flags to the blindingly green rice paddies of the Paro River Valley below, one feels utterly escaped from the surly bonds of Earth. Not far from me, a solemn monk lights incense before the Buddha. In the silence of this remote and lovely refuge–one of the Royal Kingdom of Bhutan’s hundreds of functioning Tibetan Buddhist shrines–computer chips, frequent flyer miles, the World Trade Organization, and IPOs seem part of another world.

Especially here on the Indian subcontinent, awash in corruption, ethnic struggle, illiteracy, pollution, poverty, and the clash of civilizations, Bhutan’s pacifism, paternalism, and egalitarianism stand apart. It is hardly surprising that people here often speak of “the outside world” as if it were another celestial body. Under the spell of this tranquil monastery, the unexpected hum of distant engines is like an unwelcome tocsin awaking one from reverie. I spot a minuscule white dot against a peak as one of Druk Air’s two small planes drifts down out of the cumulus clouds toward the country’s only airfield.

The yearning of postmodern Westerners to escape the velvet shackles of our hard-won progress to places like Bhutan is hardly new. In 1921, when the British governor of Bengal, Lord Ronaldshay, visited Bhutan, he too felt intoxicated at the idea of leaving the aggressive, modern world behind. “Just as Alice, when she walked through the looking glass, found herself in a new and whimsical world,” he effused, “so we, when we crossed the Pa Chu [and entered Bhutan], found ourselves as though caught up on some magic time machine fitted fantastically with a reverse.”

From such accounts, a Western fabric of mythology was woven, one that allows the tourism industry even today to proclaim Bhutan as “the last Shangri-La.” No larger than Switzerland but with a population of less than 700,000, Bhutan is, in fact, a place of peace and natural beauty. Indeed, His Majesty King Jigme Singye Wangchuck refers to his country as “a paradise on earth.” It boasts awesome snow-capped mountains, including Gangkhar Puensum, which, at 22,623 feet, is the highest unclimbed peak in the world. Climbers are not permitted to scale these peaks lest they “disturb the spirits.” It has abundant wildlife, including 165 species of mammal, like the endangered snow leopard, golden langur, and takin. Because a 1995 law mandates that 60 percent of Bhutan’s land must remain forested (while another 26 percent is already protected as parkland), it has extensive virgin forestlands. And its pastoral villages are filled with friendly people who show few signs of modern dispossession or malaise, perhaps because their government spends almost 18 percent of its national budget on education and health care (compared with only 2 to 3 percent for a country like China).