Lester Thurow is a professor of economics and management at MIT and was formerly the Dean MIT’s Sloan School of Business. He has written an awesome new book with the unfortunate title Fortune Favors the Bold: What We Must Do to Build a New and Lasting Global Prosperity.
The book is essentially about the confluence of economic power, military power, and an architecture for the global economy. Thurow has a way of writing that reads like he is channeling the Almighty. I would read this book immediately if you want to deepen your understanding of the emerging global economy from a geopolitical point of view. He makes magazines like The Economist look like a joke.
An excerpt from the first chapter:
“This imbalance of economic and military power between the United States and the rest of the world has arisen because of decisions made in Japan and Europe. Japan simply does not play the geopolitical military game. Kosovo is not its concern. It looks only at Asia and even there lets the United States deal with China and North Korea. The European Union has a population big enough and the economic resources large enough to create a modern military force equal to that of the United States. Yet with the end of the Cold War and any immediate military threat to itself, it has decided not to spend its economic resources on military activities. It is inwardly focused on the peaceful effort of building an integrated Europe. Large military budgets are seen as irrelevant to the success of failure of European integration because if there are military problems in Yugoslavia, the United States will be there. What happens in North Korea is of little interest to Europe and there is no willingness to be engaged in dealing with North Korea, since Europe is confident that America will keep such dangers under control and out of its neighborhood. America outspends the rest of NATO militarily by more than a 2 to 1 ratio. What looks sensible if one is heavily armed looks very different if one is only lightly armed.
Although sympathetic to those who died, the rest of the world did not experience 9/11 as a direct attack. Three thousand people died and 50,000 could easily have died as America’s two largest buildings, in some ways the symbols of America itself, came crashing down. And if the truth be told, right under that layer of sympathy many of those in Europe and elsewhere felt that America had it coming. It was too arrogant, too big, too much of a bully, gave too much support to Israel, and needed to be taught a lesson. They hoped that the attack on the World Trade Center would make America a little more humble and a little more cautious.
This hope flows from a fundamental misreading of the American character. When attacked, Americans get aggressive. They strike back. The 9/11 attack simply changed American attitudes. Defense spending rose sharply, and attitudes about using military power changed even more sharply. One pays for a large modern army only if one intends to use it. The rest of the world has yet to recognize these realities. What happened in the Iraqi war merely underlines these vastly altered American attitudes.
The rest of the world cannot stop America from doing anything it really wants to do or force America to do anything it does not want to do. But the rest of the world can create an environment where it makes sense for Americans to work together with them to solve mutually recognized problems-Saddam Hussein in the case of Iraq. The French overplayed their hand in the UN Security Council. They could not stop the United States from invading Iraq, but had they been willing to support a firm deadline for military action if Iraq failed to totally disarm, they cold have given inspections and the United Nations a chance to work. But they seemed to be more interested in controlling U.S. military power than in eliminating dangers in Iraq. They predictably failed in the effort to control American military power and in the process made it more difficult, if anything, for the rest of the world to control American military power in the future. In similar situations in the future the United Nations is not likely to be consulted.
There is a central political message to be learned. America cannot be controlled, but it can be engaged. Building a global economy is one way to engage America. And to some extent the rest of the world should see globalization in that light. For the rest of the world, understanding American views on globalization is central to being able to shape globalization in ways comfortable to themselves. Because of their unique perspective, Americans fear globalization less than anyone else, and as a consequence they think about it less than anyone else. When Americans do think about globalization, they think of the global economy as an enlarged version of the American economy. They do so partly because this is precisely what much of the rest of the world says they fear about globalization.
Yet globalization is, in fact, changing America faster than any other society. Nowhere is production moving offshore more rapidly. Nowhere are people’s jobs being displaced by the rearrangements of global supply chains. No one’s culture is changing more rapidly. Yet Americans hardly notice what is happening because their belief that the global economy will simply be an enlarged American economy is so strongly held. Specific political cries of economic pain are heard (the steel industry gets tariff protection), but there are no politically powerful general objections to the construction of a global economy that will in the end, in fact, ingest the American economy.
The global economy will not be an enlarged copy of the old pre-existing American economy. It will be something quite different. As a result, Americans have as much at stake in how the global economy is built as anyone else. It will change them as much as it will change anyone else. At the same time no one will have more influence than America as to how globalization is shaped.”