The Lexus and the Olive Tree

The Cold War had its disadvantages, especially if you were unlucky enough to live on the wrong side of the Iron Curtain, but at least you knew where you stood. The world was divided and two superpowers were in charge.

Under the system of globalisation that has taken shape since the fall of the Berlin Wall in 1989 the picture is more complicated.

The new world order can be characterised by one thing - the Web. The world has become increasingly interwoven. Whether you are a company or a country, opportunities and threats stem from who you are connected to.

The Cold War was described as a world of "friends" and "enemies". Globalisation turns all friends and enemies into "competitors". If globalisation was a sport it would be a 100-metre sprint - every day.

We used to live with the fear of nuclear holocaust caused by the superpowers, now we live with the fear of rapid change from an invisible enemy - a sense that your job or community can be changed at any minute by anonymous economic and technological forces that are anything but stable.

In 1975, at the height of the Cold War, 8 per cent of countries worldwide had liberal, free-market regimes and foreign direct investment totalled $23 billion, according to the World Bank. By 1997 the number of countries with liberal economies made up 28 per cent and foreign investment totalled $644 billion.

Thomas Friedman defines globalisation as the integration of markets, nation-states and technologies to an extent never witnessed before, creating unprecedented opportunities but producing a backlash from those left behind.

Which brings us to the title of this magnificent book, referring to a world where some of us worry about the latest consumer items and more of us worry about whether we will have fresh water today. Friedman got the idea for The Lexus and the Olive Tree as he was reading a newspaper report about an ongoing struggle - Palestinian refugees returning to Israel - after a visit to the Lexus luxury car factory in Japan which uses the latest robot technology.

Friedman makes sense of a relatively new and rapidly-changing world system. But he goes further than explaining the interlocking web of economics, politics and technology governing our lives by nailing his colours to the mast and outlining a political blueprint for a world in which wealth can be both created and distributed. The Lexus and the Olive Tree is strongly recommended.

John Mulqueen jmulqueen@irish-times.ie