I chose to read The Lexus and the Olive Tree this week because I’m a
big fan of Friedman’s globalization theories, having read his more recent
book, The World is Flat in high school. For those who are unfamiliar with
Friedman’s dissection of the world and international relationships, The
Lexus and The Olive Tree, explains the transition toward globalization made
possible by technology. His analogous explanations make his argument, the
world is becoming interconnected through technology, resonate with the
reader.
Friedman is a world leader in foreign affairs and columnist for the
New York Times (not to mention three time Pulitzer Prize winner). In The
Lexus and the Olive Tree, he splits foreign affairs into the “Cold War era”
and “globalized, democratized world” that exists today.
According to Friedman, the Cold War set boundaries for foreign
affairs:
“Globalization replaced the Cold War as the defining international
system…neither superpower would encroach on the other’s sphere of influence
in economics, less developed countries would focus on nurturing their own
national industries, developing countries on export-led growth, communist
countries on autarky and Western economies on regulated trade” (Friedman,
7).
The “information arbitrage” makes this transition possible; “…you have
to learn how to arbitrage information from these perspectives [politic,
culture, technology, finance, national security, and ecology] and then
weave it all together to produce a picture of the world that you would
never have if you looked at it from only one perspective” (Friedman, 20).
To best understand Friedman’s argument regarding the transition from
Cold War foreign policy to globalization, it’s crucial to understand his
analogy about the Lexus and the olive tree:
“…Lexus and the olive tree were actually pretty good symbols of this post-
Cold War era: half the world seemed to be emerging from the Cold War intent
on building a better Lexus, dedicated to modernizing, streamlining and
privatizing their economies in order to thrive in the system of
globalization. And half of the world – sometimes half the same country,
sometimes half the same person – was still caught up in the fight over who
owns which olive tree” (Friedman, 31).
Friedman further explains the symbolic meaning of each; “the Lexus is
the drive for sustenance, improvement, prosperity and modernization – as it
is played out in today’s globalization system…represents all the burgeoning
global markets, financial institutions and computer technologies with which
we pursue high living standards today” (Friedman, 33) and “…olive trees are
essential to our very being, an attachment to one’s olive trees, when taken
to excess, can lead us into forging identities, bonds and communities based
on the exclusion of others” (Friedman, 32).
Now that you have a little background on Friedman’s language, I’ll put
his theories into context of our J325 class discussions. The olive tree
represents the strong ties, connections between real people that develop
slowly over time and have great value. He mentions the olive tree is the
root that which connects people, much like strong bonds made through
bonding capital. The Lexus represents the weak ties, connections made
through Twitter, Facebook, blogs; larger forums, often dependant on the
Internet, to connect people of similar interests, similar to bridging
capital.
As I kept reading, I began to notice some wholes in Friedman’s
examples. Then I checked the publication date – 1999. Over ten years have
passed by since Friedman declared we are in a globalized world. I decided
to update his examples to make them relevant today.
Friedman lists various ways the world has become “democratized.” The
first example, the “democratization of technology.” The advent of advanced
communications tools “is what is enabling more and more people, with more
and more home computers, modems, cellular phones, cable systems and
Internet connections, to reach farther and farther, into more and more
countries, faster and faster, deeper and deeper, cheaper and cheaper than
ever before in history” (Friedman, 47). Friedman’s examples include
innovations from the 80s and 90s in telecommunications.
Today, new telecommunications tools like Skype, BBM, and FaceTime enable
people and companies to connect instantly at the global scale. For example,
my roommate is studying abroad in Spain this semester. It was her goal to
secure a summer internship before she left, but unfortunately, she was
unable to do so. She reached out to many companies, told them she was
abroad for the semester, and offered to do Skype interviews to make up for
face-to-face interviews. I thought this was a great concept, effective in
saving time and money to meet face-to-face. Not to mention, saving her from
a job search scramble when she returns home in May.
The second facet of democratization is of finance, enabled by the
democratization of technology. According to Friedman, during the Cold War
era, banking was done primarily through “white-shoe institutions” – large
and trust worthy investment banks and insurance companies (Friedman, 53).
He notes the explosion of junk bonds in the 1980s as the beginning of the
democratization of finance – investors like Michael Milken began to get
more creative bonds and portfolios they sold to consumers. Investors began
to think outside the box and used technology to invest in global markets,
truly diversifying their portfolios. If Friedman were to add an addition
today, perhaps he would attribute the creative investing that began with
junk bonds to the recession and stock market crash in 2008. Technology
allowed the investor to diversify their funds on a global scale, stirring
greed and unethical creative choices. What would Friedman think of the
mortgage-backed securities, the housing market plunge and joblessness in
America today? Would he connect the dots back to the democratization of
finance - did it spread investors too thin by providing too many
opportunities?
The last way Friedman sees democratization is through information. Much
like his explanation for the arbitrage of information, the democratization
of it relies on getting information faster because it is a commodity; “…
information is increasingly being democratized thanks to advances in
compression technology, such as the digital video disk, DVDs and CDs”
(Friedman, 62). These information storage items are all widely used today,
but USB flash-drives, and a slew of products beginning with a lowercase ‘i’
have become a more efficient way to store information. No longer do
consumers have to worry about losing their address book, as a colleague of
Friedman experienced in Israel; Backing up information is as easy as
connecting the external device with a USB cord to the computer. This
proved quite useful to me today. I recently switched over from BlackBerry
to iPhone and was offered a 60-day free trial of MobileMe. Of course, I
took the bait and tried the service. Today, my free trial expired and I
received a notice if I did not delete my account, I would be charged $100
annually to maintain the service. I didn’t want to pay for this fee because
I had never actually used MobileMe. I should have realized before I hit
“delete account” I was also hitting “delete all contacts, calendars, and
alerts.” I panicked when I saw the majority of my contacts had been removed
from my iPhone. After a small freak-out, I realized my computer had all of
my contacts backed up from my iPhone. I under five minutes, all of the
contacts I had lost on the iPhone was quickly restored, thanks to my USB
cord and iTunes.
In that small amount of time, I also realized I far too dependent on
technology. So what if I loose the contacts I made in the last few months?
Is my mini panic attack the product of Friedman’s new globalized world?
Perhaps I just proved Friedman’s argument to be true – ten years ago, the
world began to become one, globalized playing field via technology. And
today, it can’t live without it.
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