Journalist | Writer | Analyst
Review of Thomas Friedman’s The World is Flat – A Brief History of the Globalized World in the 21st Century (Allen Lane, 2005).
(A shorter version of this review was published in The Hindu on 2 August 2005).
‘Flatman’ is to globalization, what Dr Pangloss was to Candide’s world, a breathless narrator of how good the going is. For the real picture, you’ll have to look elsewhere.
Ever since I experienced, at first hand, Nato’s bombing runs over Belgrade in the summer of 1999, I’ve had little time for Thomas Friedman or his ruminations.
In those days, Mr Friedman – a widely syndicated New York Times columnist and an advocate of corporate globalisation and American military intervention around the world — used to peddle the silly idea that countries with McDonalds would never go to war against each other. Well, before he could say ‘take-away’, the United States bombed Yugoslavia, while Pakistan and India fought a war over Kargil. All these countries had McDonalds (OK, the Indian ones don’t serve beef) but they still went to war. I don’t know whether the Panamanians ate Big Macs in 1989 but even if they did, I suspect George Bush (the elder) wouldn’t have thought twice about invading them.
In The World is Flat, Mr Friedman ditches McDonalds in favour of another lemon, the Dell Theory of Conflict Prevention: “No two countries that are both part of a major global supply chain, like Dell’s, will ever fight a war against each other so long as they are both part of the same global supply chain”.
This prediction is typical of the ahistorical approach Mr Friedman adopts in order to argue that corporate globalisation is the panacea for the world’s problems. Open up your economy, be less corrupt, create institutions of good governance, let companies hire and fire workers more easily – this is essentially what those who are not benefiting from globalisation must do.
If Mr Friedman had read a little business history (instead of merely talking to CEOs) he would know that cross investment and extensive trade relations have never prevented countries from going to war against each other.
Mira Wilkins’s pioneering work on international investment before 1914 and between the two world wars, for example, has shown that trans-oceanic flows of capital were significant even then. U.S. companies invested hugely in Nazi Germany: General Motors bought a stake in Opel and Standard Oil of New Jersey (known today as Exxon) had an alliance with IG Farben, of Zyklon-B fame. Others with substantial interests were Westinghouse, Eastman Kodak and International Harvester. ITT – as the late Anthony Sampson documented in The Sovereign State of ITT (Stein & Day, 1973) – not only took a stake in Focke-Wulf, the German firm which made the FW-190 fighter-bombers, but managed to win $27 million in compensation in the 1960s for damage inflicted on its share of the Focke-Wulf plant by Allied bombs during the war.
Nor was inter-war globalisation restricted to goods alone. There was outsourcing of services too. “Specialized banks, law firms, and trading companies that focused on opening the German market to U.S. capital sprang up on both sides of the Atlantic”, notes Christopher Simpson in The Splendid Blond Beast: Money, Law and Genocide in the 20th Century (Grove Press, 1993). None of this prevented Hitler from starting World War II.
The reason this conflict-prevention theory is so important to Mr Friedman is because “supply chaining” (as exemplified by Dell) is one of 10 “flatteners” central to the book’s overall thesis – recent innovations or developments that have made the world “flat”. By flat he really means ‘level’. On page 7, the author tells us how he was sitting in the office of Nandan Nilekani in 2000 when the Infosys CEO said the international playing field for corporations and countries was being levelled by the new information technology. Mr Friedman had an epiphany. “My God, he’s telling me the world is flat!”
Stripped of the gush, what flatness boils down to is the ability of businesses to use new communications technologies in order to push the frontiers of cost-cutting by speeding up the work process and sourcing labour and inputs from every corner of the globe. Among the ‘flatteners’ are Windows, the Internet, workflow and open-source software, outsourcing, off-shoring (i.e. foreign direct investment), supply-chaining, insourcing, in-forming (i.e. Google and other search engines) and digital, wireless communication. Flatness, Mr Friedman contends, is making the world less hierarchical, more prosperous and equal (eg. by allowing Indians to work in call centres or process American tax forms), more transparent and democratic (thanks to blogging), and less prone to war.
Flatman gets so carried away with his discovery that he loses the big picture early in the book. On page 39, he visits a U.S. military base in Babil, Iraq and marvels at the live feed being relayed on a flat-screen TV from a Predator drone flying overhead. The drone is being manipulated by an expert sitting in Las Vegas and its feed monitored by a low-level officer who is accessing information earlier available only to his commanders. The Great Discoverer is overawed that Bubba’s been given a laptop. “The military playing field is being levelled’, Friedman writes, without a hint of irony. Remember, he’s in Iraq, a country that’s just been flattened by the U.S. military.
At the Arkansas nerve centre of Wal-Mart – a company he admits has labour practices that are a little unethical – Flatman finds more flatness. . Workers who are not able to move pallets piled high with boxed products fast enough are told to speed up by a “soothing” computerized voice delivered instantly through wireless headphones they must wear at all times. “You can choose whether you want your computer voice to be a man or woman, and you can choose English or Spanish”, a Wal-Mart executive says proudly. Flatman is duly impressed. This is what makes the Wal-Mart supply-chain efficient. This is what makes the world a flatter place to live.
In this flat world, threats basically come from those opposing flatness — from Al-Qaida and disgruntled elements unable to cope with the changes taking place. Flatman calls them Islamo-Leninists. At no point does he concede the possibility that the flatteners might be the ones disturbing the peace. That Iraq, for example, is in turmoil today, because of the high-tech rednecks who invaded it and not because of the ‘Islamo-Leninists’ fighting back.
Wal-Mart apart, Mr Friedman does best when he examines his own society rather than the rest of the world — about which he clearly knows far less. There are genuine insights in his discussion about the crisis in U.S. education, for example, or about how the post-9/11 restrictions on entry into the U.S. are undermining American competitiveness in the core sciences, but these get lost in the general clutter of flatness he spins out (Besides his other sins, Friedman also loves to mix his metaphors).
The basic flaw in Flatman’s analysis is his inability to separate quantitative changes from qualitative ones. New communication technologies have speeded capitalism up but they have not led to – nor are they capable of leading to – a fundamental social transformation, a change in the way economic, social and political power is exercised nationally and internationally. When a Harvard professor, Michael J. Sandel, points him in the direction of Karl Marx – who wrote about capitalist globalisation 150 years ago — to understand the same phenomenon he thinks he’s discovered, Flatman confesses it is “hard to believe” Marx has said it all already.
Another person who said it all, and better, was the Russian writer, Ilya Ehrenburg. “Cars don’t have a homeland”, he wrote in The Life of the Automobile, his classic 1929 novel on the political economy of the automotive supply chain. “Like oil stock or classic love, they can easily cross borders. Italian Fiats clamber up the cliffs of Norway. Ever worried specialists in Renault taxis jolt around the bumpy streets of Moscow. Ford is ubiquitous, he’s in Australia, he’s also in Japan. American Chevrolet trucks carry Sumatran tobacco and Palestine oranges… The automobile has come to show even the slowest minds that the earth is truly round, that the heart is just a poetic relic, that a human being contains two standard gauges: one indicates miles, the other minutes”. (Pluto Press, 1985, tr. Joachim Neugroschel)
How much has the world changed since then? Thanks to Wal-Mart, the standard gauge of minutes has been upgraded to headphones. And workers in Indian call centres have names like Jerry and get to pretend they’re from Kansas. But the world is still round, not flat. The real value addition is still creamed off by the big guys in the richest countries. And in this round world, countries sometimes will go to war because of supply chains.
In Ehrenburg’s novella, Sir Henry Deterding dreams of an empire of oil. The automobile needs gasoline, rubber for tires, tar for roads. “He already saw a grand coalition. Only, not a word about oil! Talk about the blood of the people shot down, the desecration of the Church, freedom of speech, talk in verses if you like, talk and talk, eloquently and sincerely!”
Flatman backed the invasion of Iraq. I wonder whether any of this sounds vaguely to familiar to him.