The Lexus Runs Over the Olive Tree

Confucius was asked, "What say you of the remark, 'Repay enmity with kindness?'" And he replied, "How then would you repay kindness? Repay kindness with kindness, and enmity with justice." Lun Yu (The Book of Analects).

A few years ago, Thomas L. Friedman penned a book about globalization entitled The Lexus and the Olive Tree. The title embodies a metaphor. The Lexus represents the wealth and prosperity brought on by the relentless forces of markets, capitalism, and free trade associated with globalization. The olive tree represents "everything that roots us, identifies us, and locates us in the world ... a family, a community, a tribe, a nation, a religion or, most of all a place called home." The olive tree can represent the values and institutions we wish to nurture with the wealth represented by the Lexus.

While wealth and connectedness symbolized by the Lexus and the olive tree can both be part of a healthy society, the forces of global markets often bring these values into conflict. The economic and regulatory walls erected by societies to protect communities and cultures make it difficult to partake in the growth and wealth production made possible by global markets. Modern markets depend on rapid communications and travel and the free flow of trade and capital. To reap the benefits of globalization requires that societies open themselves up to the world. Openness and market transparency are important values, but they can also overwhelm local cultures as McDonald's restaurants, Disney World, and the cell phones replace local cultural symbols and practices. What pleases global markets is not always what is culturally, morally, or religiously uplifting.

Nonetheless, globalization is a moderating influence between nations. Economically interdependent nations entwined in trade are less likely to begin wars with each other. Even the forces of nationalism and cultural exclusivity, values associated with the olive tree that sometimes lead to war, are often modulated by economic imperatives. War is bad for business.

Those who support free trade with a brutal authoritarian regime like the People's Republic of China (PRC) do so with the faith, borne out by some empirical evidence, that the requirements of global trade, the rule of law, financial accountability, and open communications, serve to undermine the Communist regime there. Even though authoritarian structures may appear solid on the surface, economic freedom eats away at the foundation of authoritarian regimes.

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