Review of books by Thomas Friedman and Lester Thurow

[Louis Proyect <lnp3@xxxxxxxxxxxxx>]

Oct. '99, Harper's Magazine

IT?S GLOBALICIOUS! Two servings, half-baked, of the new economy

By Thomas Frank

The Lexus and the Olive Tree: Understanding Globalization, by Thomas
Friedman. Farrar, Straus and Giroux. 394 pages. $27.50.

Building WEALTH: The New Rules for Individuals, Companies, and Nations in a
Knowledge-Based Economy, by Lester Thurow. HarperCollins. 301 pages. $27.50.

By now most of us have figured out that there?s nothing all that new about
the "New Economy" and "globalization." We under- stand that these ringing
phrases actually refer to something rather antique: a hopped-up capitalism
stripped of the various reforms and regulations it accreted over the course
of the twentieth century. What will surprise readers of The Lexus and the
Olive Tree and Building WEALTH is the intellectual contortions through
which even respected writers like Thomas Friedman and Lester Thurow will
put themselves in order to win for themselves, through a sort of cosmic
optimism about all things dot-com, the coveted and profitable title of Most
Enthusiastic Pundit. It?s as though our national intellectual life had
somehow been pegged to the insanely rising Dow, as though each advance on
Wall Street were a go-ahead for a new round of ecstatic superlatives in our
social criticism.

Friedman, who is the foreign affairs columnist for the New York Times, aims
not merely to describe "globalization" for us in his much-celebrated and
best-selling new book but to help us "understand" it, by which he
apparently means hammering into our heads the notion that "globalization"
is the end object of human civilization and will undoubtedly make us rich,
set us free, and elevate everything and everyone everywhere. However
familiar this incantation has become, one cannot help but be startled by
the massive escalation of rhetoric in which this now-official wisdom is
expressed. So grandiose is the tone of arrogance Friedman adopts that one
suspects he has taken leave of his senses.

Much of Friedman?s millennial enthusiasm arises from the mundane faith that
capitalism is functionally identical to democracy. He tells us of the
"Democratization of Technology," in which we all get computers and
telephones; he marvels at the "Democratization of Finance," in which we all
get to invest in everything; he paints for us a miraculous "Democratization
of Information," in which we get more TV channels than ever before. All of
these forces, he asserts, have combined to subvert top-down hierarchies of
all kinds, whether Soviet, Indonesian, or old-style American corporate.
It?s not long before he?s hailing the Internet as both the most democratic
thing on earth and the very "model of perfect competition." Astride
Friedman?s path, though, stand such blatant errors of fact that one wonders
how they were not spotted by his editors. He repeatedly and mysteriously
implies that the welfare state and regulatory policies instituted in the
l930s were in fact somehow brought about by the pressures of the Cold War;
he incorrectly asserts that "in the old days" foreign securities "were
never traded on an open market," whereas now "you and me and my Aunt Bev"
can all buy South American bonds, which of course figures as spectacular
evidence of the Democratization of Ownership (I guess Friedman has never
heard about the infamous Peruvian bonds that were sold to all manner of
middle Americans in the l920s). But let?s allow those to pass for the
moment. Error is one thing; deliberate propaganda is quite another.

Shall we start with the car and the tree that are counterposed in
Friedman?s title? These are meant to refer to excellent globalizing
economic forces on the one hand and foolish backward regionalism on the
other. It?s not an original image?one thinks immediately of Benjamin
Barber?s infinitely more balanced 1995 treatment of the same subject, Jihad
vs. Mc- World?but Friedman gives no sign that he has read any of the
sophisticated expressions of doubt about capitalism or globalization in
recent years (the books by William Greider, for example, or Edward Luttwak,
or Doug Henwood). Under no circumstances can skepticism about markets be
permitted a reasonable articulation, and so he insists on attributing it
exclusively to dictators, bigots, "politicians," the French, and other
traditional targets of American loathing. On the other side of the coin are
the various customs of capitalism, which Fried- man describes in an
embarrassingly wonder-filled style: In American barbershops they?re talking
about the Thai currency! Individuals everywhere are "super-empowered"! The
Japanese are building really fine cars?and it?s globalorious! Nothing tells
the story so well as the book?s cover, which, with its raised golden
lettering and its rendering of orangey dawn breaking over the globey globe,
reminds one of a popular religious tract.

Like day traders running up the price of Amazon.com shares, Fried- man
simply identifies the various fad ideas of the last ten years and bids them
up a little more. Take Friedman on countries other than the United States:
in one chapter he imagines the nations of the world spread out before him
like so many stock listings in the daily newspaper; he recommends that we
"buy" some and "sell" others. His definition of democracy is a simple
matter of "one dollar, one vote," a system in which the market and
corporate interests rightly and naturally get to dictate to everyone else.
Thus even as Friedman whoops it up for The People he takes pains to note
that the real boss, the market, will not tolerate any sort of political
activity beyond its very narrow spectrum of permissible beliefs. No country
that wishes to participate in the global gloriosity will be allowed to
regulate its markets or provide for its unfortunates beyond what Friedman
deems appropriate; he even describes the various punishments that the wrong
sort of voting might bring down on a country, as investors "stampede and
stock markets crash.

Most revealing is Friedman?s understanding of the United States itself, a
country in whose image markets quite naturally wish to remake the world. In
a closing chapter Friedman asks us to wonder with him at how "a visionary
geo-architect" (i.e., God) would go about designing the ultimate nation,
how He would insist that it have "the most flexible labor market in the
world," that all manner of rebellions and zany lifestyle accessories be
tolerated in the boardroom as the signs of creativity that they are, that
corporate managements be allowed "to hire and fire workers with relative
ease." Evidently it?s not enough anymore to claim, as Rockefeller did, that
"God gave me my money"; in passages like these Friedman is virtually asking
us to imagine God ghostwriting the Tom Peters books, God descending from
the heavens to bust PATCO, to pass the Taft-Hartley Act over Truman?s veto,
to send in the strikebreakers, to make Manpower the largest employer in the
land.

In stylistic terms the book seems to belong to that genre of madly
triumphalist TV commercial that the software and brokerage industries have
been running in recent years, and Friedman quotes such commercials
throughout his book?not as examples of transparent efforts to sell some-
thing but as particularly compelling and truthful bits of shamanistic
sooth-saying that he evaluates only by appending his fervent amens. That
Charles Schwab commercial in which regular people talk about how they
bought shares in one company or an- other? Right on! That Merrill Lynch ad
that claims "The World Is 10 Years Old"? Exactly!

Thomas Friedman may write like a TV commercial, but he proudly in- forms us
that he thinks like a "hedge fund manager." And when future students of the
1990s seek to categorize his book they will be tempted to under- stand it
as a contribution to that pop- ular genre of business writing known as
"futurism," a literature marked by its gawking talk about the
ever-increasing rate of "change," its ranks of neologisms, and its
homegrown metanarratives. But what Friedman has actually written is a
dictionary of the shibboleths of our time, awesome in its inclusiveness.
They?re all there: the desire to "rebrand" Britain, casual badmouthing of
France for its efforts to retain its welfare state, facile equating of
Great Society America with the Soviet Union. Each of them is foolish and
monstrous in its own way; thrown together they leave a truly dispiriting
impression. I can only compare the sensation of reading The Lexus and the
Olive Tree to the first time I heard Newt Gingrich speak publicly and it
began to dawn on me that this is what the ruling class calls thinking, that
this handful of pathetic, palpably untrue prejudices are all the ruling
class has to guide it as it shuttles back and forth between the State
Department and the big think tanks, discussing what it means to do with us
and how it plans to dispose of our nation.

Competition among pundits is heating up, though, and Thomas Friedman can?t
expect to hold the title of the new glob- al order?s most fervent
celebrator for too long. MIT economist Lester Thurow?s new book, Building
WEALTH (yes, it?s in all caps?all the way through the book), seems to have
sprung from a simple desire to run up the hyperbole averages just a little
higher. In a few months the Dow will be sailing off into uncharted five-
digit expanses, and it seems only fitting that a well-known economist
should try his hand at the epiphanic, orgiastic style that is clearly
becoming one of the trademark literary gestures of this unhappy fin de siècle.

Unfortunately, Thurow doesn?t pull it off with anywhere near the wonderment
mustered by Friedman. However he may cheer for the great god Creativity or
whisper about the all- destroying Entrepreneur, the economic facts to which
he is professionally bound keep getting in the way. Several of the alarming
declarations with which the book begins have been contradicted by its end,
and although Thurow (like Friedman) makes a fear- some show of calling down
the fire of the free-market heavens on those welfare-stating Europeans, he
has acknowledged before long that in some crucial ways they may have the
numbers on us.

Like Lexus, Building WEALTH is superficially organized as a sort of lay-
man?s guide to the "third industrial revolution" upon which the author
believes that we have embarked. But Thurow has come to evangelize rather
than to narrate, to tell us why it is that everyone on earth must come
around to his way or suffer the hideous consequences. Whenever this simple
impulse gets him into a jam, Thurow simply pulls out the concept of
"inevitability," a handy logical atom bomb over which he seems to believe
that he and his fellow New Economy ideologues enjoy an unquestioned
monopoly. Genetic engineering will "inevitably" triumph over its doubters;
"trying to defend" old standards of income equality "is impossible"; "all
of Europe is an also-ran" in the "new man-made brainpower industries of the
twenty-first century." Building WEALTH is, in this respect, one long study
in the technique of selling what is in many ways a backward social system
by enthusiastically announcing it to be the way of the future?a rhetorical
maneuver we haven?t seen so much of on these shores since the hey- day of
old-school Marxism.

But the working class, whose triumph once seemed so certain, appears in
Building WEALTH only as a hapless victim, stripped of any historical agency
whatsoever. No, the makers of history here are the billionaires, up- on
whom Thurow fastens with a curious obsessiveness. Just a few pages in- to
Building WEALTH he commences an ode to the rich and their virtues that
matches anything in the history of the Republic for sheer, irony-free
obsequiousness:

--Great wealth allows individuals to place their footprints in the sands of
time...

--Political influence can be quietly bought. Campaign contributions
effectively give the wealthy more than one vote....

--Those with great wealth are important, to be courted. They are deserving
of respect and demand deference. They are the winners.

--Wealth...is the only game to play if you want to prove your mettle. It is
the big leagues. If you do not play there, by definition you are second rate.

Thurow has excellent reason for establishing the godliness of the wealthy
early on. When the traditional tools of economic measurement don?t serve
time. his celebratory narrative?most notably on the issue of productivity:
it seems that darn Web isn?t changing everything as much as the TV
commercials say it is!?he rolls out a nifty index of his own invention: How
many billionaires are there? As evidence of his assertion that "America is
back!" Thurow offers the fact that "the world?s wealthiest man is once
again an American," that "American billionaires number in the hundreds."
Asian economic error, meanwhile, is nailed down by the observation that
"what had been forty-one Japanese billionaires fell to only nine at the
most recent count. And to persuade us that we should welcome cultural and
economic "disequilibnium," Thurow confides that in such a state
?billionaires could emerge." Although Thurow doesn?t take his logic much
further than this, one could easily posit a billionaires-to-earnings ratio
and conclude that by far the most laudable economic endeavors are the
launching of Internet IPOs. Thurow, by the way, is on the board of
day-trading propagandist E*Trade.

Building billionaires, then, is what all our labor is about, and having
piled up such a prodigious amount of the stuff that makes life worth living
at the feet of Bill Gates, we Americans, in Thurow?s telling, have decided
to re- make both our society and the outside world so that this magical
operation might be repeated again and again. Unfortunately, the price of
building billionaires is very, very high: to make them sufficiently rich,
in fact, we must do nothing less than "destroy the old," a line Thurow
repeats like a mantra throughout his text. So crucial is wreaking this
destruction?on culture, on institutions, on the assumptions of the
past?that he sees it as the very nature of entrepreneurship and the
organizing principle of society: "Social systems have to be built that give
entrepreneurs room to destroy the old."

Destroying the way we live just so we can have more billionaires doesn't
sound like a great bargain on the surface. And one of the better features
of Thurow?s book is that, unlike Friedman, he is occasionally willing to
admit that other interpretations of re- cent economic events are just as
plausible as his millennialist account. The stock market runup might be a
mere bubble; the making of billionaires might be a sign not of society?s
health but of its illness. These passages, though, are quickly forgotten as
Thurow gets back to what he does best: casually tossing off all manner of
staggering assertions about history, society, and the national character of
various peoples as proof that (a) we don?t have a choice and (b) we aren?t
good Americans if we don?t join him on his knees before the billionaires.
This latter tendency is particularly annoying. For Thomas Friedman,
employers? ability to fire workers at will is ordained by God; for Lester
Thurow, it?s an "American-style right" with "no notice, no severance pay,
no justification necessary." And the massive concentration of wealth that
has emerged over the last two decades? For Thurow, that, too, is just our
nature. America is a land "comfortable with inequalities," a place where
one man having as much as nearly half the population (think about that one
the next time you feel the phrase "American democracy" forming on your
lips) doesn?t lead "anyone of importance to suggest that Americans ought to
change the system."

In Thurow?s telling, history is almost always quaint and ancient, and it
almost always comes with an easily deciphered moral: fifteenth-century
China proves this; turn-of-the-century Russia proves that. When Thurow
finally breaks down and acknowledges the last sixty years of our own
nation?s history, it?s all stereo- type and History Channel voice-over. In
his accounting of the postwar period, for example, the United States
somehow prevailed alone against an entirely red globe; those treasonous
British, you see, elected a Labour government, and "In the 1950s, all of
the third world believed in the communist model of development." Add to the
bad history and the mad generalizations Thurow?s curious refusal to include
his footnotes in the book (we?re supposed to look them up online) and a
persistent problem with spelling and subject-verb agreement, and one can
almost get outraged about this stuff. Even an economist, one feels, should
have had the courtesy to run spell-check before calling for the end of
Western civilization.


Louis Proyect
Marxism mailing list: (http://www.panix.com/~lnp3/marxism.html)