When MIT professor and economist provocateur Lester Thurow lectures, he asks
the audience to challenge him to explain how an industry—any industry—will be
transformed by new technologies. He is well prepared for the test: Thurow,
former dean of MIT’s Sloan School of Business, was one of the early and
leading heralds of advanced technology’s power to transform business. He is also
well known for his positions on international trade and the role of government,
but he defies easy ideological categorization. For example, he warns of the challenges of globalization while arguing that embracing it is the only
viable path to national wealth. Thurow published his 11th book, Fortune
Favors the Bold: What We Must Do to Build a New and Lasting Global
Prosperity (HarperBusiness Books) last fall.
Those of us who stray into
the waters of the international economy as investors or entrepreneurs may find
his guide to its ebbs and flows will help keep us off its reefs.
The more we loosen government controls on trade, the more the invisible hand of the global market will guide the efficient flow of
goods and services.
The idea that there should be no government intervention in the free
market except to insure a level playing field assumes that the field can be
level, which it cannot. There are irrational factors in the market which make it
uneven, and addressing these requires a degree of political globalization.
One obvious recent irrational factor requiring a multinational political
response was the SARS epidemic. In the future, a global government institution,
such as the World Health Organization, may have to coordinate a global approach
to health issues. Eventually, people will realize that individual countries
cannot run their own health institutions; China’s delay in dealing with SARS,
for example, significantly worsened the epidemic within its borders and raised
the danger beyond them.
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