Kanwal Sibal reviews 'That Used to Be US What Went Wrong with America- and how it can come back'

That Used to Be US What Went Wrong with America- and how it can come back
By Thomas L Friedman and Michael Mandelbaum
Little, Brown
Pages: 630
Price: Rs 799

As the title suggests, this book deals with the reality of the United States' slow decline , the reasons for it, and how the country can recover its global pre-eminence.

According to the authors, the post Cold War era presented four major challenges for the US: how to adapt to globalisation, how to adjust to the information technology, or IT, revolution, how to cope with the soaring deficits stemming from the growing demands on the government, and how to manage a world of rising energy consumption and rising climate threat.

Unfortunately, the authors note, US public policy lost focus after the Cold War ended. In the last 20 years America's biggest problems relating to education, deficits and debt, and energy and climate change, have been neglected to the point that they cannot now be addressed without collective action and collective sacrifice.

The US has stopped investing in the country's traditional formula for greatness - immigration, education and sensible regulation. The political system has become paralysed and values have corroded. For the authors, if America is to remain a great country, it must, while reducing deficits, invest in education, infrastructure, and research and development, as well as open up US society to talented immigration, and fix the regulations that govern the economy.

Globalisation and the IT revolution have put virtually every US job under pressure. Almost all work has become more complex and more demanding of critical-thinking skills, requiring every American to be better educated to secure a well-paying job. The challenge to America is now from low-wage, high-skill workers from across the globe. Education levels in America in mathematics and the sciences have fallen badly, which led President Obama to declare that "the country that out-educates us today will outcompete us tomorrow".

The world is now even flatter than in 2005 (when Friedman's book The World Is Flat was published), with the coming of Facebook, Twitter, the cloud, 3G and Skype. In the past only governments and armies had high-scale command and control systems, now the people do. The potential for individuals today to globalise their talents, hobbies and passions into applications is unprecedented and unbounded in potential.

The authors devote a full chapter to explain why the IT revolution and globalisation have changed the nature of the job market, with routine workers being replaced by non-routine 'creators and servers'. In time, this revolution will efface the distinction between 'developed' and 'developing' countries, with the world being divided into high-imagination-enabling and low-imagination-enabling countries, the latter being those that fail to develop their people's creative capacities.

Rising national debt and annual deficits in the US have expanded to dangerous levels because of the habit of not raising enough money through taxes to meet federal expenditure, and then borrowing trillions of dollars to bridge the gap. For the US to be able to sustain a rising standard of living, it has to play a leading role in developing new energy technologies to ward off the threat of fossil fuels to the planet's biosphere.

These two challenges - the deficit and the intersection of energy and climate - have been neglected to the point that the US has been in deficit denial and climate change denial. America has been able to finance its growing budget deficits by borrowing from other countries, notably China.

The authors propose five pillars of a publicprivate partnership to foster economic growth: providing public education to more and more Americans, building and modernising the country's infrastructure, keeping the US's doors to immigration open, providing government support for basic research and development, and implementing necessary regulation on private economic activity. Unfortunately, in their eyes, the political debate in America has strayed absurdly from the virtues of the public-private formula, with liberals blaming Wall Street and big business for all problems, and conservatives believing that tax cuts will miraculously grow the pie.

In an analysis that brings to mind the present situation in India, the authors rue the political polarisation in the US, with the hyper-energised media environment making politics an intense form of entertainment, depicting politics more and more as a sport. Besides, unlike in India's case, the US has no big external enemy to enforce a sense of national unity.

Reading this book only confirms the view that the business of the US is business. The authors measure the country's greatness and its capacity for recovery in terms of job creation and the ability to compete with others. It is an arid landscape in which the only yardstick of accomplishment as a society and self-satisfaction as a nation is success in the marketplace and being ahead of others.

No wonder the authors argue that the American dream - the glue that has held together a diverse, highly competitive and often fractious society - depends on sustained, robust economic growth which now depends on the country meeting the challenges it faces, central to which is creating thriving businesses and well-paying jobs.

The book is meant for the lay reader. The copious references to movie scenes and dialogues to underline points would appeal to such a reader, though a more demanding one may feel they dilute the book's seriousness. Tom Friedman's writing style is by now very familiar with its stock in trade handling of issues and themes, sometimes irksome for being too glib and slick in presentation. All in all, however, it is a readable, unpretentious book that sums up well the problems facing the US.

The author is a former foreign secretary