Tuesday, February 18, 1997
GLOBALISM:
Economic hot zones’ growth still limited by gargantuan
governmentsBy Thomas L. Friedman
New York Times
There is a concern that as globalization knits countries and
markets together it will flatten cultural differences, as we’re all
forced to drink Coke, eat Big Macs and compute on Windows 95. In
some ways, this is happening. But in other ways a country’s
distinct political and economic culture actually becomes more
important in this brave new world.
For one thing, as globalization shrinks governments and lowers
national boundaries, cultures and societies now interact much more
directly. And as globalization gives everyone access to the same
information, resources, technology and markets, a society’s
particular ability to put these pieces together in the fastest and
most innovative manner increasingly separates winners from losers
in the global economy.
Consider Italy. Italy, in some ways, is the ultimate
post-industrial society: It has no government!
Well, just kidding, but the fact is that some of Italy’s vices
during the cold war  its weak governments, its epidemic of
tax evasion, the penchant of Italians to work around the state
rather than through it  have become virtues in this era of
globalization, when, as they say, it’s no longer the big who eat
the small, but the fast who eat the slow.
Italy today is nothing if not fast. In fact, the fastest-growing
and single richest region in Europe today is northeastern Italy
(the districts of Lombardy and Veneto). There, thousands of small
and medium-sized Italian entrepreneurs, who are used to operating
without state help and often don’t pay taxes, have created a
beehive of trading companies and small manufacturing operations
that have become hugely successful from Slovenia to Singapore.
"Italy is not a computer with a central brain," Prime Minister
Romano Prodi explained to me. "It is like the Internet Â
everyone gives his contribution. If you give some basic rules and
infrastructure for this system, its performance will be
unbelievable. You have 6,000 Italian entrepreneurs in Romania
today. You wouldn’t know the name of a single one of their
companies, but they are all over and very active."
Specializing in everything from eyeglass frames to high fashion,
these small Italian entrepreneurs have quietly made Italy the
fifth-largest industrial power in the world. Because these Italian
companies are small and flexible they can convert their industries
from pasta to shoes very quickly, according to market demands. Says
one U.S. official in Rome: "You come to a Frenchman and say, ‘I
would like some purple cheese.’ He will tell you, ‘Cheese is never
purple.’ You come to a German and ask for purple cheese, he will
tell you, ‘Purple cheese is not in the catalog, sorry.’ You come to
an Italian and ask for purple cheese and he will ask you: ‘What
shade of purple would you like? Magenta?’"
This fast economic culture, which combines a flair for
technological and design innovation, a disdain for government, a
trading network linked with a diaspora (overseas Italians),
individualism and entrepreneurship is hardly unique to northern
Italy. You see similar hot zones in Hong Kong, Taiwan, Singapore
and regions of China (plus the overseas Chinese), Israel (plus the
overseas Jews) and parts of India (plus the overseas Indians), as
well as Korea, Brazil, Argentina and Chile, to name but a few.
So will these hot zones rule the world? Not yet. Northern Italy
may look beyond Italy for its markets, but it’s still part of
Italy. And the Italian state, no matter how weak, was a typical
bloated Western European welfare state, which now has enormous
debts that someone has to pay off. So it still matters where you
live, and what your national economy is doing. Northern Italy can
go a long way, but unless the Italian state can downsize, improve
its roads and telecommunications and spur research and development,
the north will never achieve its full potential.
So culture matters a lot in this new world, but so still do
states, and the trick is getting the right balance. For instance,
Germany is too much Alan Greenspan and not enough Benetton. Italy
is too much Benetton and not enough Greenspan. France is not enough
of either. As Luccio Carocciolo, editor of the Italian foreign
policy journal Limes, remarked to me: "If we had German
infrastructure and Italian flexibility, we would be a
superpower."