Thursday, March 16, 2006

Three Billion New Capitalists: The Great Shift of Wealth and Power to the East

Next up on my continuing theme of globalization and collaboration is Clyde Prestowitz' book Three Billion New Capitalists: The Great Shift of Wealth and Power to the East...

Peter Fingar, in his book Extreme Competition refers to Prestowitz' book quite a bit. I haven't read Prestowitz' book myself, but from reading about from others and seeing the reviews of it on, I think one can get the basic idea. Some quotes there of interest ...

From Publisher's Weekly:
While China and India focus on trade and industrial policies and turn out competent workers who put in long hours at a fraction of American wages, the U.S., Preston argues, struggles with crushing trade and budget deficits, a zero savings rate, failing schools, dwindling investments in scientific training and research, a collapsing dollar and a debt-dependent economy that will face an "economic 9/11" once foreign creditors bail out... and argues cogently that the research and development apparatus and high-tech entrepreneurship that is supposed to save America's economy is likely instead to follow the manufacturing base offshore. It's a lucid and sobering forecast.
From BookList's Mary Whaley:
Prestowitz, economic trend-spotter, reports, "Over the past two decades . . . China, India and the former Soviet Union all decided to leave their respective socialist workers paradise and drive their 3 billion citizens along the once despised capitalist road." These new capitalists symbolize the threats to end 600 years of Western economic domination as America's lead role in invention and technological innovation lessens and the Internet allows jobs to be performed anywhere. The author foresees the possibility of an "economic 9/11," which won't kill but will cause great hardship. To prevent what he sees as an accident waiting to happen, Prestowitz offers a wide range of solutions relating to the dollar's role in today's global marketplace, addressing the reality that Americans consume too much and Asians save too much, and facing energy challenges in the U.S and problems confronting our educational system. The author offers valuable insight into these important topics currently being debated in government and corporate circles.
From Robert D. Steele:
His most important point is made in one line: America does not have a strategy. America does not have a strategy for winning the global war on terror, it does not have an energy strategy, it does not have an education strategy, it does not have an economic or competitiveness strategy. The government is being run on assertion and ideology rather than evidence and thought--a media cartoon has captured the situation perfectly: as the VP tells the President that we are "turning the corner" the two walls behind them are labeled Incompetence and Fantasy. As a moderate Republican and a trained intelligence professional with two books on the latter topic, I have to say that this book by this author, a Reaganite businessman and senior appointee in the Department of Commerce is right on target. We *are* out of touch with reality, and we do not appreciate, at any level from White House to School House, the tsunami that is about to hit us.

The author makes two important points early on in the books: first, that information is the currency of this age, replacing money, labor, and physical resources; and second, that the best innovation comes from the right mix of sound education across the board, heavy investment in research & development, and a co-located manufacturing bases that can tinker with R&D and have a back and forth effect. America lacks all three of the latter, and is not yet serious about investing in global coverage of all languages, 24/7.
The book goes into a lot more depth and detail about the Asian culture and economy, and chapter 12 has the author's list of recommendations for what the US needs to do (Steele says chapter 12 alone worth the price of the book).

This indeed seems to be an interesting book, and an interesting lead-in to the one I'll discuss next, Peter Fingar's Extreme Competition, which is another sort of call to arms for the business and software industries, and gives even more emphasis to collaboration and human interaction management.

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