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April 22, 2005
The Dell plan for world peace
As long as people go on ordering Dell computers, globalisation will continue to work, and the countries that supply and sell the components will remain at peace.
That's the argument made by US journalist and commentator Thomas L. Friedman in The World is Flat: Brief History of the Globalized World in the 21st Century.
Friedman has been developing this theory since he observed that no two countries that both had McDonald's hamburger stores had ever fought a war against each other since each got its McDonald's, leading to his Golden Arches Theory of Conflict Prevention. He hypothesised that as countries are woven into the fabric of global trade and rising living standards, the cost of war for victor and vanquished became prohibitively high.
The Dell Theory expands on that, stipulating that no two countries that are both part of a major global supply chain, such as Dell's, will ever fight a war against each other, because people embedded in major global supply chains don't want to fight old-time wars any more.
Doesn't it make you want to telephone Dell immediately, and order a laptop?
Aside from the bewildering linkages that occur between someone ordering a laptop in New York, and having it arrive in Nashville, via a chartered 747 flight from Penang, Malaysia and Taipei, Friedman has unearthed fascinating stuff like this:
If Wal-Mart was a country, it would now be China's eighth-biggest trading partner, ahead of Russia, Australia and Canada.
UPS ships 13.5 million packages a day - which means that at any given moment, 2% of the world's GDP is in the back of a UPS delivery truck.
When multinationals 'outsource' work to developing countries, they typically not only save 75% on wages, but also gain a 100% increase in productivity.
>Last year, of the 2.8 million science degrees awarded around the world, 1.2 million were gained by Asian students in Asian universities, and in China last year BScs in engineering represented 46% of all university degrees; in America, it was 5 per cent.
Don't ask what percentage of Australian graduates are engineers. The answer is too depressing.
Posted by cw at April 22, 2005 11:16 AM
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Comments
As far as Friedman's theory is concerned its really just warmed up Karl Marx, particularly the bits he took from Adam Smith and extrapolated. And this made Marx optimistic too, but in a different way to Friedman!
Dell would not be the best example of successes of globalisation since their product is in my experience (and I'm talking Desktops) shoddy in workmanship and particularly in design. Though the latter appears to be deliberate fault, upgrading a Dell is often a nightmare, since Dell branded bits are often all that will work (shades of the razor industry).
I recently opened up a 2.8 P4 Dell Inspirion seeking to add another hard disk. It was standard sized desktop box but had no place in the case for either an extra disk or extra dvd/cd drive!
In another recent incident I know of, a Dell equiped Computer lab suffered 19 motherboard failures out of 25 newly installed computers. The local techies were exasperated but only found remarkable the especially high number of failures in this batch.
And does that 75% reduction in wages and 100% increase in producitivity (actually a 25% increase in "real" productivity if the reduction in wages is counted as a productivity improvement, which conventionally it is) mean that Dell and other multinationals are up there with Nike as immoral exploiters of misery in autocratic third world countries? The again that they are would not surprise old Karl either.
Posted by: tflip at April 25, 2005 06:25 PM