Good News - It's a Small World

Capital is the second engine. That restaurants in Seoul are now advertising "IMF menus" for their cheapest offerings attests to the power that money has to determine national identity. Financial markets "are not just wiring economies together and altering the structures of companies,... they're also changing entire political systems," observe Micklethwait and Wooldridge. Our ability to send money around the globe is not a new feat, but our ability to send massive amounts at the touch of a button -- now that's something truly revolutionary.

The third engine is management. "The internationalization of business practices now has its own momentum, and it is also accelerating," write the authors. Reengineering and economic-value added are concepts that are practiced by organizations as diverse as the British Treasury and Thai Farmers Bank PLC. Patrick Wang, the proprietor of Hong Kong's Johnson Electric, the world's second-largest maker of electric motors, reads the Harvard Business Review "religiously." International consultancies and business schools have helped to seed a global canon of management.

Those three forces haven't increased everyone's fortunes, of course. The "Asian Contagion" of 1998 did more than bring down governments; it destroyed lives. Thanks to globalization, some people have lost their jobs and their income, while others have merely been overlooked.

Take Dwight Bobo, 54, an electrician in Flint, Michigan, for instance. He was one of 3,400 General Motors employees who struck a stamping factory in the summer of 1998 over job security and productivity -- and, really, globalization. Basically, Bobo, who made $23 an hour, had become too expensive compared to the workers GM could hire in Mexico. "You can't just work hard and get ahead," Bobo says. "Your job could be shipped overseas."

Micklethwait and Wooldridge readily acknowledge the suffering that globalization has created. "The doctrine of competitive advantage is a wonderful one if you have advantages with which to be competitive," they write. "But what if you have a history of oppression, poor education, and malign government? Like many human things, globalization can often be just downright unfair or carelessly vicious."

But they also recognize that the negativism is overstated. Much of what is blamed on globalization is really the result of technological advances or, more often, of bad government (by Russian politicians, say) or bad management (by GM execs, for example). Indeed, they argue, the global dynamic typically serves to magnify the mistakes made by incapable bureaucrats.

And ultimately, the authors write, there are enough winners from globalization "to make it worth pressing forward." Globalization is helping to create an economy that is at once closer to the classic theoretical model of capitalism and to the model that liberal political theorists once imagined. It frees people to pursue their own interests in the light of perfect information and allows them, "within reasonable bounds, to pursue the good life wherever they find it."

So why does globalization face such vocal, and such damaging, criticism? In part, Micklethwait and Wooldridge explain, the reason is that its victims are more visible than its beneficiaries -- and its opponents are more effective campaigners than its supporters. Proponents of globalization, the authors argue, believe its benefits are so manifestly obvious that they require no elaboration.

But globalization is not inevitable. As Micklethwait and Wooldridge observe, the world is only now returning to the openness that it had achieved a century ago -- before nationalism and wrong-minded economic thinking drove in a wave of regulation and trade barriers. Even now, governments find it more politically expedient to appease vested local interests.

Politicians and businesspeople can ensure that globalization persists. More efficient government and less regulation, according to "A Future Perfect," will itself attract global commerce. But politicians also must invest in basic research and education to build the human capital on which the global economy feeds. And businesses must rediscover philanthropy, to fortify the local communities in which they operate -- and to mitigate the suffering of the relative few whom globalization leaves behind.

Those are pretty amorphous solutions -- and Micklethwait and Wooldridge appear to doubt their actual utility. Globalization will thrive on its own very considerable inertia -- or be slowed by those who act out of myopic self-interest. In the end, it is hard to imagine a strategy, public relations or other, that will interrupt that very human dynamic.