Globalization: Great?

APRIL 25, 2005

BOOKS
Globalization Is Great -- Sort Of
THE WORLD IS FLAT
A Brief History of
the Twenty-First Century

By Thomas L. Friedman
Farrar, Straus & Giroux -- 488pp -- $27.50
(Readers' Reviews below)Editor's Review
The Good A thorough account of how the revolution in technology is accelerating globalization.
The Bad Friedman is reluctant to trust his evidence rather than the theory of free trade.
The Bottom Line The book tackles the big questions and the thorniest issues about globalization.
Did Thomas L. Friedman have an epiphany halfway through writing his new book? I imagine him jumping into a taxi at Washington National Airport after a visit to Bangalore and finding a laid-off American software engineer behind the wheel. After listening to Friedman gush about the wonders of a "flattening earth" -- the author's term for technology- driven globalization -- he hands him a résumé. "I'll take just about anything in tech," says the overeducated cabbie. "I'm that desperate."

This is just my imagination, of course. But the first half of The World Is Flat: A Brief History of the Twenty-First Century is a feel-good paean to the ingenuity of man, while the second half -- like the story of our taxi driver -- is tinged with despair.

Friedman, columnist for The New York Times, nicely sums up the explosion of digital-technology advances during the past 15 years and places the phenomenon in its global context. Just consider that the Web, search engines, digital photography, iPods, e-mail, PDAs, the browser, file sharing, Wi-Fi, and a dozen other cutting-edge technologies have not only come to dominate economics and the workplace but have also helped reshape the political world -- all in less than a generation. Change has been so rapid and overwhelming that there hasn't been time to keep track of the developments, much less to understand their implications. The world is flattening, Friedman says -- meaning it is increasingly interconnected. This can raise the poor from poverty, nourish a worldwide middle class, and even spread democracy.

Apparently blessed with unlimited travel funds, Friedman visits innovation centers throughout Asia and America, talking to the seers of silicon -- from Netscape co-founder Marc Andreessen to Vivek Paul, president of Wipro, the Indian software company -- to discern the meaning of it all. Friedman's conclusion: "Technology determinism" is the force that will rule the economy, just as Charles Darwin's natural selection rules biology. This same technological determinism will also dictate which people in America keep a job and which ones see their work outsourced to Bangalore or Shanghai.

This leads to part two of Friedman's book, wherein hope for a bright technological future goes dim. Half of the world -- Africa, much of Latin America, and rural areas of India and China -- isn't flattening at all. These places are impoverished, disease-ridden, and without prospects. Because of them, globalization could wind up "like a rocket that takes off but quickly falls back to earth for lack of sustained thrust."

The long-term outlook for America isn't so great either, Friedman allows. India's specialized technology institutes are turning out battalions of software wizards. China is producing armies of engineers and scientists. They are all eager to work for wages that would violate labor standards in the U.S. but provide a nice middle-class income in their countries. Meanwhile, the fiber-optic cables that certain American companies obligingly laid across the Pacific Ocean shortly before going bankrupt are making it a snap to send offshore the jobs of accountants, software writers, radiologists, illustrators, journalists (gulp), and just about anyone else whose work is knowledge-based.

Oddly, Friedman so badly wants to see all the nifty techno-change as a positive force that, when he contemplates the effects on American jobs and wages, he says his mind keeps telling him: "Ricardo is right, Ricardo is right, Ricardo is right." Friedman is alluding to David Ricardo, the 18th century British economist who came up with the theory of comparative advantage, which should assure Americans of some kind of meaningful work. In theory.

Friedman's ambivalence prompts him to visit the oracles of the major think tanks of Washington, and he concludes that the savior for our unemployed software engineers is...education. The solution, which Friedman likens to JFK's goal of putting a man on the moon, "is to put every American man and woman on campus." The problem is that more and more PhD grads in the sciences and engineering are foreigners who increasingly return home to write our software and design the next killer app.

So what, realistically, can be done? One of the better solutions is wage insurance, an excellent idea that has been kicking around Washington for a while. It would supply displaced workers starting on a new job with a year or so of income supplement. In today's flattened economy, it's possible for skilled workers to find new jobs, after all -- just not ones that pay as much. Friedman calls this expansion of the safety net "compassionate flattening."

To be fair, I wouldn't think of skipping one of Friedman's op-ed columns in the Times. He never shrinks from the biggest problems and the thorniest issues. The World Is Flat is no less ambitious. At the least, our imaginary laid-off cab driver can reassure himself that he's hardly alone.
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By Paul Magnusson