The War for Wealth: The True Story of Globalization, or Why the Flat World Is Broken

by Gabor Steingart

A LIBRARY JOURNAL 2008 BEST BUSINESS BOOK OF THE YEAR

Globalization. The Flat World. Outsourcing. Free Trade.

Each of these phrases is a flashpoint in one of the most heated debates of our lifetime: Is globalization a force for good, or is it a policy that is sure to destroy the economic foundation of the United States and Europe while exporting our wealth and prosperity overseas?

In The War for Wealth,...

• Format: Hardcover
• Language: English
• ISBN: 0071545964
• ISBN13: 9780071545969
• Release Date: April 2008
• Publisher: McGraw-Hill Companies
• Length: 304 Pages
• Weight: 1.40 lbs.
• Dimensions: 1.1" x 6.3" x 9.1"

Customer Reviews

a great book probably coming too late

I feel almost personally grateful to Steingart because he has written something I have always wanted to say, but couldn't possibly have said so well. The questions he asks on page 227, for example, have been troubling me for years. I beseech every American to pause and respond to these buring questions. "Did you really believe that you could live, in the long term, on borrowed money? "Who actually claimed that such a large nation doesn't need an industrial base? "Where are the men and women who made us believe that a negative balance of trade is a sigh of strength? "Why did no one on Wall Street sound the alarm bell when the U.S. dollar became eroded and lost intrinsic value for such a prolonged period of time? "Is it possible that no one could have noticed a country that was once the world's biggest lender selling off its assets to others? "How could the entrenchment of economic inequality in a democratic nation have been tolerated for so long? "What happed to the upward mobility that was once this country's trademark? "And, last but not least: why did democracy, which is supposed to react more quickly to malfunctions than other forms of government, fail so miserably?" As someone who genuinely wishes America well, it pains me to see this great country de-industrialized and become the biggest debtor in human history, reduced to begging more loans from foreign powers such as the Chinese Communist regime. My gut feeling is that it's too late to remedy the dire situation. I pray miracle happens. I wish to be proven wrong. By the way, Deng Xiaoping was never premier of China, as Steingart told us. His official position, when he did hold one, was vice-premier, though he was the paramount leader of the Chinese Communist Party from the early 80s. Chinese politics was bizare.

Look Into the Future!

Steingart believes we spend too much time worrying about places like Kabul and Baghdad, and not enough thinking about places like Shanghai. "The War for Wealth" then details that case. Steingart also contends that the true tale of globalization is not being told - it is anything but a win-win situation. By 2025 China and India will likely dominate the world market with their purchasing power. It took both the U.S. and Japan about 40 years to double their per capita GDP; China took only twelve years. Harvard historian David Landes believes that their success (and others) is determined by culture - moral values and behaviors. Unfortunately, per Steingart, we currently are paving the road to our demise with self-deception and self-affirmation. Premier Deng Xiaoping was underestimated by Western leaders when he took over after Mao's death - partly because capitalism was seen as incompatible with a lack of democracy. Deng began by gradually liberalizing restraints on China's collectivized farmers, and in five years 98% of farmland was back in their hands. Deng also put off the military demands for resources, telling them the economy needed to grow first. Subsidies for government businesses decreased, then stopped, in exchange for the state no longer claiming all their revenues. Deng also opened China to foreign investment - $7 million in 1980, $250 billion now. Deng's changes were much more successful than those in resource-rich Russia which underwent a U.S. consultant-led crash immersion. Brazil, Russia, China, and India together comprise about 45% of the world's labor supply. This will increase further - by 2050 another 1.2 billion are expected to live in Asia. Those waiting for Chinese wages to equal those in the U.S., thereby eliminating its competitive advantage, have a long wait - Steingart estimates it will take another 30 years before Asian incomes are half as high as those in the U.S., if wage growth in Asia remains constant. Eighty percent of Wal-Mart's suppliers are in China; until 2004 the U.S. was the largest exporter of IT products - now it is China. Chinese innovation is accelerated by partnership requirements placed on Westerners building in China, piracy, espionage, R & D spending about 1/3 that of the U.S. (not adjusted for currency differences), extensive training in U.S. universities, higher IQs (about 10 points, on average, per research elsewhere; nine of Microsoft's ten most promising employees are Asian), and buying Western companies and resources. (Hitachi bought RCA and found it could sell its products at a higher price using the RCA label.) Not only is Chinese labor much cheaper than that in the U.S., it doesn't have the social overhead costs of the U.S. - eg. health care and pensions. Potential Flashpoints in the Future: North Korea (supported by China) vs. South Korea, India (backed by Russia) vs. Pakistan (backed by China), and Taiwan. Meanwhile, the U.S. and China continue their strange economic re

Insightful and compelling...

I am currently researching NATO's history, so I was immediately intrigued when I heard about Gabor Steingart's ideas on an "economic NATO" - a stronger partnership between Europe and the US intended to grapple with the challenges posed by emerging economic powerhouses such as China and India and the new forms of authoritarian democracy they propagate. I would not agree with all the conclusions of his book -- overall, I am more optimistic that future giants such as China will ultimately come to the conclusion that increasingly playing by the rules is in their best interest, and that current giants like the US will manage to remain competitive, just as they did when confronted by another economic threat from Asia, Japan, in the 1980s. However, Steingart presents an inspiring and thought-provoking case for the need for stronger transatlantic cooperation: he mixes compelling reporting from all over the world with sharp and concise analysis. The far-reaching interview with Prof. Samuelson at the end of the book is big plus, too. I particularly liked, though, that Steingart does not hesitate to develop a real vision for the partnership between Europe and the US. In the conclusion, he refers to John F. Kennedy's Philadelphia speech from 1962 and his often overlooked ideas on a transatlantic cooperation beyond NATO. Given the roadblocks even minor agreements seem to encounter, it might be overly optimistic to hope for really closer ties anytime soon -- but any outline of a vision for the future is badly needed in the current debates on the relationship between Europe and the US. That is because, unfortunately, far too many people on both sides of the Atlantic seem to consider the "special relationship" a thing of the past rather than the huge field of opportunity it actually is

A Must Read ...

Gabor Steingart not only takes the incredibly complex issue of globalization and puts it into terms we can all recognize and understand, but he then dares to go where many authors fear to tread: he offers solutions. For anyone seriously interested in the future of America, it's a real page-turner. Kris Kline, co-author Estados Unidos/United States

An important and timely book...

Gabor Steingart's book, the War for Wealth, offers a compelling and frightening assessment on the global balance of power and how it is changing. Steingart shows that while the US, Europe and other liberal democratic countries have enjoyed preeminent economic status and a high quality of life, the rise of China and India and other developing nations are emerging as very real and serious threats. He offers a wealth of informed and insightful commentary on the nature of these threats and what can be done to counteract them. This book is essential reading to anyone interested in understanding the way in which the global balance of power is shifting and how we can respond.