THE WORLD IS FLAT

I was able to finish another book on my Summer Reading List (see below) over the weekend. This time it was Thomas Friedman’s work, the NY Times Bestseller – The World is Flat. In college I, as I’m sure many of you did, encountered Friedman on a number of occasions (Beirut to Jeruselum for example) and have continued to read his pieces in the Times. The book, as can be expected, was basically an articulated and comprehensive summary of many of the ideas expressed in his columns and previous books. However, in this manuscript, those ideas are unified to create a well formed argument concerning globalization, American economy, quality of life, and international relations. I’ve written a short review of the book below - but I suggest you buy it and read it, the anecdotes are entertaining and writing makes for easy and enjoyable reading.

In The World is Flat, Thomas Friedman argues that the rate of globalization has increased tremendously since the year 2000, fueled by technological advances and political reform. Furthermore, his major thesis is that the United State must begin making serious changes to its policies, work force, and education system in order to remain competitive in a new economic and global environment.

First, Friedman outlines 3 major phases of Globalization both chronologically and methodologically. He suggests that the first phase of Globalization took place before the Industrial Revolution, during the period of exploration by Columbus and others and religious crusades to other countries. The author suggests that this phase of globalization was driven by countries and muscle and resulted in the shrinkage of the world from large to medium. In the second phase, we shrunk from medium to small due to global integration of multinational corporations. However, the author emphasizes the current phase of globalization (Globalization 3.0) in which individuals drive the shrinking of the world through technological advances and technological infrastructure. This period, argues Freidman is critical because it allows individuals from anywhere in the world to compete globally through equal access to the internet, computers, and other technology services. In other words, the playing field has been leveled globally and the world is flat.

Early in the manuscript, Friedman outlines the 10 major innovations, inventions, or advances that have allowed the flattening of the world. These include: the fall of the Berlin Wall, the invention and public release of the Netscape browser, Open source software, the Windows operating system, outsourcing, offshoring, supply chaining, insourcing, and PDAs/cellphones.

Throughout the early portion of the book, the author makes his case for why each of these innovations was so significant. The Berlin Wall opened up a new market, a new community of hungry and ready workers and consumers. The release of Netscape allowed people to easily access data without understanding the nuances of computer technology and http file transfer. Open source software allows individuals to modify and change software to fit their needs and allows exponential and mass changes to take-hold and increase the efficacy of software programs. The Windows OS helped make computers easy to use for all populations and individuals. Outsourcing, and this is critical, reshapes the American economy, allowing American companies to invest more money in research and development, creating new jobs that did not previously exist in our country. Offshoring allows opportunities for people in India, South Korea, China and other locations and also provides low status American jobs to individuals in areas where the jobs are higher status – providing them with educational and advancement opportunities. Furthermore, offshoring changes the PATTERN of jobs (not the number) in all involved countries and in the country doing the offshoring requires upskilling or retraining of workers for new jobs that are created or not yet invented. Supply chaining allows goods to be moved rapidly and cheaply over large geographical distances and also may play a role in social interactions and cooperation between countries (discussed below). Insourcing generates new jobs that did not exist previously in established countries and allows organizations to increase their efficacy and redefine their role. UPS is the best example of this, argues Friedman, since they now come into a company and take over operation from warehousing to transport and ordering, allowing the company to focus on design, creation, research, and development. In-forming represents the easy access to information and knowledge via the internet and internet search engines such as Google. This makes all knowledge accessible to all people and goes hand in hand with the final significant innovation, the development and spread of PDAs and cellphones. These devices empower individuals to carry knowledge and to create media and act as journalists and archivers of their environment with relatively little expense.

Much of these changes, suggests Friedman were driven by the Dot-Com Boom of the mid to late 90s, most notably, the overinvestment in fiber optic cable which allows those in Bangalore to have high speed internet access and communicate and share data in real time all over the world.

The author also suggests that these technologies converged during the year 2000 to drive a global revolution in economics and market forces.

In the first half of his work, Friedman lays out and supports his case for rapid individual and technology driven globalization after the year 2000. In the second half of the book, Friedman suggests ways in which the United States can craft policy to adjust and prosper in this new climate. Many of the arguments made in the second half of this book go hand in hand with Richard Florida’s arguments concerning the rise of the creative class, the competition for that class and the knowledge-driven economy of the future. Friedman suggests major overhauls in American education, including subsidized 2 year college programs and significant incentives for corporate job training allowing employees to become “always employable” in the event of a layoff. Friedman even delves into international relations and suggests that the reliance on supply chaining is directly correlated with cross-country relationships (positing that countries involved in the intricate Dell computer supply chain are least likely to be counterparts in a war or skirmish) and suggests that economic stability is the major way to maintain peace between tense areas such as Pakistan/India and China/Taiwan.

Overall, there is a bit of “the sky is falling” feel to the book, however, Friedman articulates something that everyone kinda knows already – the world changed a lot over the past few years the jobs of my generation and my kids generation won’t look anything like the jobs of our parents or their parents. I think Friedman has gotten it right – we are in the middle of an economic revolution that will change the world even more greatly than the Industrial Revolution and will allow the potential for corporation and innovation between countries or conflict and war for energy, resources, and jobs. American policy must be greatly altered to recognize our role in this global marketplace or our protectionist and isolationist past will lead to an economic downturn and decreased quality of life in the future.

Amazon.com The World Is Flat

NY TIMES Thomas Friedman Column