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But the world's still round

SIDDHARTH VARADARAJAN

`Flatman' is to globalisation, what Dr. Pangloss was to Candide's world, a breathless narrator of how good the going is


THE WORLD IS FLAT — A Brief History of the Globalized World in the 21st Century: Thomas Friedman; Allen Lane, an imprint of Penguin Books, 11, Community Centre, Panchsheel Park, New Delhi-110017. 13.50.

Ever since I experienced, at first hand, NATO's bombing runs over Belgrade in 1999, I've had little time for Thomas Friedman or his ruminations. In those days, Thomas Friedman — New York Times columnist and advocate of corporate globalisation and American military intervention — 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 U.S. bombed Yugoslavia, and Pakistan and India fought a war over Kargil. All these countries had McDonalds.

Ahistorical approach

In this book, Friedman ditches McDonalds for 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... " This prediction is typical of his ahistorical approach. If Friedman had read business history, he would know that investment relations have never prevented countries from fighting 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 had an alliance with IG Farben.

ITT - as Anthony Sampson documented in The Sovereign State of ITT — not only took a stake in Focke-Wulf, the German firm which made 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 theory is so important to Friedman is because "supply chaining" (as exemplified by Dell) is one of 10 "flatteners" — recent developments that have made the world "flat".

The author was sitting in Nandan Nilekani's office in 2000 when the Infosys CEO said the international playing field was being levelled by information technology. Mr. Friedman had an epiphany. "My God, he's telling me the world is flat!." Stripped of the gush, flatness is simply a company's ability to use new communications technologies to cut costs by speeding up the work process and sourcing labour and inputs from every corner of the globe.

Flatteners

Among the "flatteners": Windows, the Internet, workflow and open-source software, outsourcing, off-shoring (i.e. foreign direct investment), supply-chaining, insourcing, Google and wireless communication. Flatness, Friedman contends, is making the world less hierarchical, more prosperous and equal (by allowing Indians to work in call centres), more transparent and democratic, and less prone to war.

Flatman gets so carried away he loses the big picture early in the book. 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 feed is being monitored by a low-level officer who is accessing information earlier available only to his commanders. "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.

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 don't move pallets fast enough are told to speed up by a "soothing" computerised voice delivered instantly through wireless headphones they 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. In this flat world, threats come from those opposing flatness — from Al-Qaeda 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.

Still round

The basic flaw in Flatman's analysis is his inability to separate quantitative changes from qualititative ones. New communication technologies have speeded capitalism up but they haven't changed the way economic, social and political power is exercised nationally and internationally. When a Harvard professor points him in the direction of Karl Marx — who wrote about capitalist globalistion 150 years ago — Flatman confesses it is "hard to believe" Marx has said it all already.

The Russian writer, Ilya Ehrenburg, also said it all, and better. "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... 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."

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 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. 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 familiar to him.

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