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The World Market

By David Gergen, editor-at-large of U.S. News and World Report, talks with New York Times columnist Thomas Friedman, author of The Lexus and the Olive Tree: Understanding Globalization.
Online NewsHour
May 26, 1999

JIM LEHRER: A Gergen Dialogue. David Gergen engages New York Times columnist Thomas Friedman, author of The Lexus and the Olive Tree: Understanding Globalization.

DAVID GERGEN: Tom, we've been working for the past ten years to try to describe what the new world looks like. Ever since the Berlin Wall fell, the Cold War ended, nobody knows how to talk about this new world. You've come up with a way to think about it.

THOMAS FRIEDMAN: Well, this book, David, is my declaration that the statute of limitations on the foreign policy cliché, the post-Cold War world, is over, okay? The theme of this book is as follows: Globalization-- the integration of finance, markets and technology-- in a way, that's shrinking the world from a size medium to a size small, and is allowing all of us to reach out into the world farther, faster, deeper and cheaper than ever before, and allowing the world to reach into us farther, faster, deeper and cheaper than ever before. This thing called globalization isn't a fad, isn't a trend, isn't a Nintendo game. It is the international system that has now replaced the Cold War system. Now, the Cold War system was characterized by one overarching feature: Division. The world was a divided, chopped-up place, and all your threats and opportunities in that system grew from who you were divided from. And it was symbolized by one overarching symbol: The Wall. The globalization system is characterized by one overarching feature: Integration. In this system, all your threats and opportunities flow from who you're connected to. And it's also symbolized by one overarching symbol: The Web. So we've gone from a world of division and walls to a world of integration and web. In the Cold War, we reached for the hotline, which was a symbol that we were all divided, but at least two people were in charge: The United States and the Soviet Union. In globalization, we reach for the Internet, which is a symbol that we're all connected and nobody's in charge.


THOMAS FRIEDMAN: And that's the fundamental difference between these two systems.

DAVID GERGEN: You say it's also democratized a lot of things: Democratized information, it's democratized power, it's pushed the power out away from centralized bodies, and empowered a lot of other people.

THOMAS FRIEDMAN: Absolutely. You know, I was flying home from California yesterday, and I was sitting a seat -- a new seat on an airplane, okay? And what did I notice? The seat buttons. You could adjust the top, the neck, the head, the back, the seat, the lever, the bottom, the shin, the foot. The seat had been democratized, thanks to technology. Suddenly you could adjust this seat not just with one button, push it back. You could adjust it for every muscle in your body now. And that is true throughout this system. Basically, what globalization did was attack any bloated, sclerotic, overweight system and really force it to de-concentrate power. I tell a story in the book about a farmer in northern Minnesota, Gary Wagner, who has democratized his farm. Well, now how did he do that? He has his tractor connected to a GPS satellite, and the GPs satellite tracks every foot he has on his farm. It tells him-- he knows from previous plantings -- just how much water, fertilizer, what kind of seed that particular acre likes. And he goes up and down his field, and the satellite tracks him and automatically dispenses the exact amount of fertilizer, water and seed that that acre wants. He's let every acre speak for itself and tell him what it wants. And that's what you've got to do to adjust to this new system. You've got to democratize your school, your institution, and your farm.

DAVID GERGEN: But at the same time the arms race has been replaced by an economic race. And what you describe is we're no longer in a situation where you have the first world, the second world and the third world. You call it the fast world and the slow world.

THOMAS FRIEDMAN: What happens when the walls get blown away is exactly that, David. There's just the fast world and the slow world. To have a third world, you need a third space. But there is no third space because the walls get blown away. So now not every country -- no country, in fact, including our own, is entirely in the fast world or in the slow world. You have hot zones in every country, some larger than others. Northern Italy, for instance, is the richest region in Europe; it's a really hot zone of entrepreneurial energy and talent. The Tel Aviv-Haifa Corridor, hot zone; Coastal China, hot zone.

DAVID GERGEN: Silicon Valley.

THOMAS FRIEDMAN: Parts of Korea, hot zone; Silicon Valley, hot zone. Now, when you combine a hot zone with a global Diaspora-- Bangalore, India and Indians; Northern Italy and Italians; Coastal China and Chinese; Tel Aviv-Haifa with the Jews; you have a cyber-tribe. These hot zones in a global Diaspora - and these cyber-tribes, I believe in this world without walls, are going to do very, very well in the fast world. Those in the slow world will have problems, and sometimes they're going to live in the region right next door to someone in the fast world.

DAVID GERGEN: What are the implications for governments?

THOMAS FRIEDMAN: For governments, you know, there's two debates about globalization when it comes to government. One school says governments are going to wither away. I'm not in that school . I am in the school that says that the state is still important for two reasons: one, it's still the vessel for our olive trees; for our identity, for our sense of community, place, history. At the same time, the size of your state is going to have to go down, but the quality of your state's going to have to rise, because the state is still the filter, the vehicle, with which you will kind of interact with this globalization system. You still need the rule of law, the oversight, the quality institutions, and the better they are -- look at Southeast Asia. Which country in Southeast Asia suffered least from the Asian economic crisis? Taiwan. Which has the best government, the most democratic government, and the freest press? Taiwan. Governance still matters.

DAVID GERGEN: You argue that neither the conservatives nor the liberals have it quite right. You've got to combine a free market with a strong safety net.

THOMAS FRIEDMAN: Well, I describe myself as a radical integrationist, social safety-netter. What do I mean by that? I mean that I believe you dare not be a globalizer in this world, a free trade advocate, an Internet - a web site in every pot - you know, advocate without being a social democrat, without being willing to have your tax dollars used to bring the have-nots, the know-nots, the left-behinds, into this system, to democratize globalization, because otherwise you're not going to generate the political openness, the political consensus for openness if you don't do that. At the same time though, you dare not be a social Democrat today without also being a globalizer, without being ready to be open to the world with more free trade, more integration, more immigration, bringing that knowledge, talent in this country, because otherwise you're not going to generate the incomes and growth you need to take care of the know-nots and the have- nots. I believe what we're going through in this country today, in this new system, is a new debate about where is that equilibrium point now between openness and safety nets? The welfare debate last year was part of that . So my motto is, I'm for cushions, not walls; I'm for floors, not ceilings; I'm for protection, not protectionism.

DAVID GERGEN: Final subject. What implications about raising a child?

THOMAS FRIEDMAN: I get this question a lot, you know, from people. And my simple answer is this. You know, David, if I could wave a magic wand and pass one law in this country, that law would be that every modem that is sold in the future to connect people to the Internet come with a label, and the label would say "Judgment not Included." And what do I mean by that? I mean when that when you come to this thing called the Internet today, you come really naked. There's no editor there. There's no teacher. There's no sensor. It's you and that thing. So what you come to it in your heart and in your head, both in terms of your values and in terms of your skills is critical. So when people ask me about my own kids, it's about reading, writing and arithmetic. That is, it's old-time values are that much more important when you come to a system that is so wide open and is going to depend so much on you and what you personally bring to it.

DAVID GERGEN: Tom Friedman, thank you very much.

THOMAS FRIEDMAN: A pleasure. Thanks, David.

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