This book is worth reading because it is an exhaustive account about what's happening in the world due to globalization. Thomas L. Friedman identifies the main forces and technological innovations that made globalization possible, chief among them being the thousands of miles of fiber optic cable that were laid down before the dot com bust of 2000 that make a telephone call to India easier, faster and better than a call across town. This makes it possible to outsource back office and call center work, help desks, credit card inquiries etc to Bangalore where there is a large well-educated work force eager to handle this kind of work for about one sixth the cost of an American worker.
He goes into great detail about how Wal-Mart, Dell and others make use of cheap foreign labor and modern computers and communications including the internet, a process called supply-chaining, so that new customer orders or replacement inventory can be automatically generated at the cheapest source in the world and then transported by means of a global parcel distribution system pioneered by UPS and FedEx. This makes every business, large or small, a global business from its inception. Storefronts started by housewives on Ebay are global by default. The world is flat because labor can be accessed anywhere in the world, but especially in India, China and Russia where there are large, well-educated populations. By the same token, markets can be accessed anywhere in the world. Routine tasks and even such tasks as accounting can be done anywhere there is a computer terminal hooked up to the internet. Globalization has done a lot for countries like India and China where fairly large segments of the population are moving into the middle class thanks to outsourcing and offshoring. However, as Friedman points out, this is still a drop in the bucket compared to the large overall populations in these countries. So even though a middle class is developing, the bulk of the populations are still poor.
Since manufacturing facilities and labor can be located anywhere in the world, it makes sense to seek these items out where they can be provided for the least cost. Then the products must either be transported to markets in other parts of the world or sold in the countries of origin. As middle classes develop in other parts of the world, consumers there have purchasing power which creates markets for consumer goods in the developing world as well as the more established consumer markets in America, Europe and other developed nations.
What do these developments portend for America? Friedman makes no bones about the fact that American jobs are being lost to other countries where the work can be done more cheaply. If transportation costs are cheap (in the case of call center work there are no transportation costs), work will be done elsewhere. Friedman's solution for American workers is the same old starry-eyed fol de rol that we've heard before. American workers have to work harder, be better educated, more clever, more creative, work harder etc. This is the mentality of the rat race. Instead of calling his different phases Globalization 1.0 and Globalization 2.0, he might just as well have called them Rat Race 1.0 and Rat Race 2.0. Rat Race 1.0 is when Americans just had to compete with other Americans for jobs. They had to study hard, get into the best colleges, work hard and compete to get ahead working long hours to impress the boss.
Corporations wanted workers who were docile and compliant and spent their leisure hours consuming and buying stuff - cars, houses, fast food, beer and prescription drugs especially. Now Rat Race 2.0 is when a door opens and about a billion other rats enter the arena. Now you have to race faster, run harder, study more, work harder, be more docile and compliant to get ahead in the competitive struggle. More and more jobs that aren't worthy of American citizens or are jobs Americans aren't willing to do, according to this scenario, are being farmed out, while we Americans will do the real creative, value added work. Guess what? It's bullshit. Other countries are increasingly taking over the creative work as well. Top level research is being done decreasingly by Americans and increasingly by Chinese and East Indians. Friedman's solution for the American worker, to constantly retrain, change jobs, get more education, work harder, work longer, is in the end a prescription for a heart attack and a nervous breakdown, much to the drug companies' delight.
Instead here's an alternative scenario for the American worker. Start your own business. Then your job cannot be outsourced. Why leave your fate up to corporations who have no loyalty to workers but will seek the cheapest labor wherever they can find it in the world? Become a capitalist yourself! Train yourself for a line of work over which you have complete control, and a line of work that can't be outsourced. Examples: medicine, law, plumbing, electrician, handyman, barber and beauty shops, franchises such as Starbucks, real estate. Whatever you do, don't go into high tech, cutting edge fields. These are the primary candidates for outsourcing. Take the money you would have spent on college and instead invest it in real estate. Your goal should be not to just be a worker living from paycheck to paycheck with the American dream of a mortgage and a couple of cars. Your goal should be to increase your net assets, your net worth, to the point that you can live off of a return from capital and not just the sweat of your brow. This is what they don't teach you in school where they teach the new American Dream which Friedman totally endorses which is to get better educated, work harder and run faster in the rat race. A moderately successful business man (and I include handymen, gardeners and plumbers in this category) doesn't have to do this. More importantly, a moderately successful businessman does not have to beg a corporation for a job.
If you're in business for yourself, whether you're a big time or small time operator, you have control over what you do, how you do it and when you do it. You don't have to enculturate yourself in some corporate culture. You can be your own person. You can speak your own mind. You might, by so doing, lose a customer here and there, but you won't lose your job as you would if you got into an argument with your boss. You can set your own working conditions, workweek (quantity and quality of hours), holiday and vacation schedule and benefits. You're not in the position of being a beggar or having to ingratiate yourself to your boss. In other words you're free, something which all Americans supposedly cherish, but in reality most of them only think they're free because they're basically just free to consume and vote for the party which has the most money for smear ads.
To be fair to Friedman, he doesn't think the whole globalization scenario is completely rosy for everyone. He acknowledges that there are many parts of the world which are not flat, where there is misery, disease, unemployment, disempowerment. He rightfully understands the role that humiliation plays in the gestation of anger and resentment among the classes and societies that are left out of the increasing prosperity for the lucky ones. In India, for example, the outcasts are the lowest of the low, live in squalor and aren't even seen as fit to associate with non-outcasts who consider them dirty. So you have the two extremes in one country. The outcasts of the world need something to hope for or they will turn to anger, resentment and destruction, in a word - terrorism. Globalization is not the solution for everyone although it's Friedman's solution - more globalization to include the disenfranchised, that is.
But there's a disconnect here. Corporations who are in the business of cherry picking the best and cheapest labor in the world in order to maximize profits for their shareholders (and for management too, incidentally) have no interest in being social workers. In fact their interests are diametrically opposed. Their interests are in paying out the least amount of money for labor and taking in the greatest amount of money in sales, that is for their shareholders, not for humanity in general.
Of course, not everyone agrees with Friedman's view of the world. His book, however, will be much discussed and chewed over. Nevertheless, this is a good book for those not familiar with how the process of globalization has changed and is changing the world bringing at least some prosperity to some who haven't had it before.
