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processes demand。〃 
Amen。 We too have to do things differently。 We are going to have to sort out what 
to keep; what to discard; what to adapt; what to adopt; where to redouble our efforts; 
and where to intensify our focus。 That is what this chapter is about。 This is just 
an intuition; but the flattening of the world is going to be hugely disruptive to 
both traditional and developed societies。 The weak will fall farther behind faster。 
The traditional 
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will feel the force of modernization much more profoundly。 The new will get turned 
into old quicker。 The developed will be challenged by the underdeveloped much more 
profoundly。 I worry; because so much political stability is built on economic 
stability; and economic stability is not going to be a feature of the flat world。 
Add it all up and you can see that the disruptions are going to come faster and harder。 
Think about Microsoft trying to figure out how to deal with a global army of people 
writing software for free! We are entering an era of creative destruction on steroids。 
Even if your country has a comprehensive strategy for dealing with flatism; it is 
going to be a challenge of a whole new dimension。 But if you don't have a strategy 
at all。。。 well; you've been warned。 This is not a test。 
Being an American; I am most focused on my own country。 How do we go about maximizing 
the benefits and opportunities of the flat world; and providing protection for those 
who have difficulty with the transition; without resorting to protectionism or 
runaway capitalism? Some will offer traditional conservative responses; some will 
offer traditional liberal ones。 I offer compassionate flatism; which is a policy blend 
built around five broad categories of action for the age of flat: leadership; muscle 
building; cushioning; social activism; and parenting。 
Leadership 
The job of the politician in America; whether at the local; state; or national level; 
should be; in good part; to help educate and explain to people what world they are 
living in and what they need to do if they want to thrive within it。 One problem we 
have today; though; is that so many American politicians don't seem to have a clue 
about the flat world。 As venture capitalist John Doerr once remarked to me; 〃You talk 
to the leadership in China; and they are all the engineers; and they get what is going 
on immediately。 The Americans don't; because they're all 
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lawyers。〃 Added Bill Gates; 〃The Chinese have risk taking down; hard work down; 
education; and when you meet with Chinese politicians; they are all scientists and 
engineers。 You can have a numeric discussion with them…you are never discussing 'give 
me a one…liner to embarrass 'my political rivals' with。' You are meeting with an 
intelligent bureaucracy。〃 
I am not saying we should require all politicians to hold engineering degrees; but 
it would be helpful if they had a basic understanding of the forces that are flattening 
the world; were able to educate constituents about them and galvanize a response。 


We have way too many politicians in America today who seem to do the opposite。 They 
seem to go out of their way actually to make their constituents stupid…encouraging 
them to believe that certain jobs are 〃American jobs〃 and can be protected from foreign 
competition; or that because America has always dominated economically in our 
lifetimes it always will; or that compassion should be equated with protectionism。 
It is hard to have an American national strategy for dealing with flatism if people 
won't even acknowledge that there is an education gap emerging and that there is an 
ambition gap emerging and that we are in a quiet crisis。 For instance; of all the 
policy choices that the Republican…led Congress could have made in forging the FY 
2005 budget; how in the world could it have decided to cut the funding of the National 
Science Foundation by more than 100 million? 
We need politicians who are able and willing to both explain and inspire。 And what 
they most need to explain to Americans is pretty much what Lou Gerstner explained 
to the workforce of IBM when he took over as chairman in 1993; when the company was 
losing billions of dollars。 At the time; IBM was facing a near…death experience owing 
to its failure to adapt to and capitalize on the business computing market that it 
invented。 IBM got arrogant。 It had built its whole franchise around helping customers 
solve problems。 But after a while it stopped listening to its customers。 It thought 
it didn'thave to。 And when IBM stopped listening toits customers; it stopped creating 
value that mattered for its customers; and that had been the whole strength of its 
business。 A friend of mine who worked at IBM back then told me that when he was in 
his first year at the company and taking an internal course;his IBM instructor boasted 
to him that IBM was such a great company; it could do 〃extraor

dinary things with just average people。〃 As the world started to flatten; though; 
IBM found that it could not continue thriving with an overabundance of average people 
working for a company that had stopped being a good listener。 
But when a company is the pioneer; the vanguard; the top dog; the crown jewel; it 
is hard to look in the mirror and tell itself it is in a not…so…quiet crisis and better 
start to make a new history or become history。 Gerstner decided that he would be that 
mirror。 He told IBM it was ugly and that a strategy built largely around designing 
and selling computers…rather than the services and strategies to get the most out 
of those computers for each customer…didn't make sense。 Needless to say; this was 
a shock for IBMers。 
〃Transformation of an enterprise begins with a sense of crisis or urgency;〃 Gerstner 
told students at Harvard Business School; in a December 9; 2002; talk。 〃No institution 
will go through fundamental change unless it believes it is in deep trouble and needs 
to do something different to survive。〃 It is impossible to ignore the parallel with 
America as a whole in the early twenty…first century。 
When Lou Gerstner came in; one of the first things he did was replace the notion of 
lifetime employment with the notion of lifetime em…ployability。 A friend of mine; 
Alex Attal; a French…born software engineer who was working for IBM at the time; 
described the shift this way: 〃Instead of IBM giving you a guarantee that you will 
be employed; you had to guarantee that you could stay employable。 The company would 


give you the framework; but you had to build it yourself。 It's all about adapting。 
I was head of sales for IBM France at the time。 It was the mid…nineties。 I told my 
people that in the old days 'the concept of' lifetime employment was only a company's 
responsibility; not a personal responsibility。 But once we move to a model of 
employability; that becomes a shared responsibility。 The company will give you access 
to knowledge; but you have to take advantage of it。。。 You have to build the skills 
because it will be you against a lot of other people。〃 
When Gerstner started to change the paradigm at IBM; he kept stressing the issue of 
individual empowerment。 Said Attal; 〃He under283 
stood that an extraordinary company could only be built on a critical mass of 
extraordinary people。〃 
As at IBM; so in America。 Average Joe has to become special; specialized; or adaptable 
Joe。 The job of government andbusiness isnot toguarantee anyone a lifetime job…those 
days are over。 That social contract has been ripped up with the flattening of the 
world。 What government can and must guarantee people is the chance to make themselves 
more employable。 We don't want America to be to the world what IBM was becoming to 
the computer industry in the 1980s: the people who opened the field and then became 
too timid; arrogant; and ordinary to play on it。 We want America to be the born…again 
IBM。 
Politicians not only need to explain to people the flat world; they need to inspire 
them to rise to the challenge of it。 There is more to political leadership than a 
competition for who can offer the most lavish safety nets。 Yes; we must 

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