Customer Reviews

End of the Line: The Rise and Coming Fall of the Global Corporation

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Barry Lynn's End of the Line is a superb volume that shows why economic analysis should not be left to economists. There are several occupational hazards of being an economist, the most irksome being that you have to pretend that politics and economics are not only different but actually separate. This sort of thinking is fine when one is engaged in a certain type of scientific economics - the dispassionate explanation of an aspect of our economic arrangements - but is a disaster when it comes to explaining real life economies. Market societies, for better and worse, are the product of deeply rooted economic imperatives that play out against institutions built in political - power - struggles between people with opposing interests and disparate means to achieve their ends. Economies are jerry-rigged, improvised institutions that sometimes work well and sometimes work very, very badly. Because Lynn is not an economist, he is less inclined to worship at the altar of free markets and more inclined to look at how the self-interested actions of leading business men and women, government officials and the general public combine to create risk as well as opportunity in our global economic commons. Lynn's lack of free market piety will earn him critics among the acolytes of laissez faire economics, but the rest of us should be grateful that he writes about the real world in these confusing times.

Lynn's point in End of the Line is to remind us that the global economy is, like all human creations, a grand improvisation that creates and distributes wealth in ways that are beyond the control of its designers in business and government. Lynn has penned a wise, witty and at times angry look at globalization that departs from the stale argument about whether global capitalism is good or bad in favor of a far more subtle, and scary portrait of a risk laden production system that is, at least for now, beyond any government's control. End of the Line is a meditation on what happens when short term self-interest leads global businesses to make bottom line decisions that enhance their own profitability in ways that increase the vulnerability of the system as a whole, and governments abdicate their responsibility to monitor and manage an economy - even a global economy - for the sake of the common good.

Lynn asks us to see the global economy as a vast and intricate system of economic plumbing that links suppliers and customers in every corner of the globe. This plumbing system is nothing but an ever evolving set of connections that becomes denser when corporations outsource their operations to producers in lower cost countries in order to provide customers with high quality products at low prices. The global growth of free trade, with relatively little regulation or oversight by governments in the interest of global prosperity, has been an immense boon to the fortunes of millions of previously desperately people around the world, whose incomes and life chances have blossomed because they are making goods and services that people in rich countries want and need.

Yet, common sense tells us that an unregulated plumbing system, left to grow by itself without any supervision or rules, is bound to develop all sorts of problems that mushroom into total system failure under the wrong circumstances. Imagine the eventual public health disaster that would happen in a city that let all building and homeowners make their own connections to the main water and sewer lines. The resulting mess would poison our water and cities with filth because no agent was responsible for managing the system in the interest of the community as a whole. A smooth flow of water and sewage requires regulation of the rational plumbing system in order for everyone to prosper from the use of water and the proper management of waste.

End of the Line makes an urgent yet curiously under-appreciated point: The contemporary global economy is a very leaky plumbing system that is subject to catastrophic breakdown because its evolution is driven by the private interests of global corporate managers rather than the common good. This leaky plumbing system is the result of a deliberate choice by the global government - the United States - to refrain from managing the world economy in our nation's interests in favor of a utopian vision of a planet wide free market that would regulate itself, and thereby eventually enrich the world. Lynn has bad news for all who believe that the free market is all the world needs to have peace, security and stability: the breakdown of the global economy's plumbing will lead to the same kind of mess as an unregulated system of city plumbing unless we are smart enough to realize that a free market requires a strong, smart and wise government to deftly manage the world economy with a light but competent touch.

End of the Line is not an anti-globalization screed about how global capitalism is destroying the world's poorest people, or poisoning our environment, or generating corruption on an epic scale. Instead, Lynn wants to alert us to the fact that we have created a global economy where a natural disaster or political conflict could disrupt the entire system in ways that threaten the well-being, or in extreme cases, the lives of millions of people. The culprit here is the old conflict between the private and the public interest, this time played out on a global scale. Lynn wants us to see how our love affair with the free market has, inadvertently but predictably, created economic insecurity that can only be handled by government or governments.

The lesson that Lynn drives home is clear and difficult to avoid: either the leading power in the global economy - the United States - will step up to the task of managing capitalism in its own interest in light of its sense of the legitimate interests of the rest of the world or some other power will take over global leadership. If, no when, the global system's plumbing breaks down in the future, some nations or group of nations will fix the resulting mess, and promulgate rules and regulations to reduce the likelihood of system failure in the future. The US cannot afford to wait so long that some other power or powers, with the approval of the rest of the world, offer a credible alternative vision for managing the global economic system in light of their own interests as well as their understanding of our interests. Such a circumstance is a sure road to conflict - hot or cold, or both.

End of the Line is also an announcement of a new type of American economic nationalism, where Lynn makes a case for a strong American role in the management of the global economy in the interest of the American people. According to Lynn, the threats to global economic security and American prosperity are the result of the deliberate policies of the Clinton administration, which foolishly downgraded the role of the US government in building and managing global trade in favor of free market ideologies that ignore the historical fact that markets function best when governments intervene with the right mix of wisdom and restraint. The Clinton administration portrayed in End of the Line looks less like the interventionist, big government liberals bent on supplanting free markets with government power in the interest of some idea of justice or the social good and more like a successor to the Reagan/Bush the Elder administrations' project of restraining and rolling back the New Deal in favor of the revival of capitalism "red in tooth and claw". Sections of End of the Line suggest that Clinton and his associates are better seen as the second of three successive Bush administrations - with Clinton et al as the not-well-loved but useful adopted children of the Elder Bush and disdained siblings of Bush the Younger - bent on rationalizing and consolidating the Reagan revolution against a strong US government in economic affairs. This indictment, which will outrage as many Democrats as Republicans, is essentially right: Clinton was the kinder, gentler Bush whose paternalistic worries about the common man and woman never deflected him from the path of opening the US economy to the gales of creative destruction and globalization which drive growing income disparities at home and, according to Lynn, increasing economic insecurity in the global economy overall. Lynn treats Clinton and the Democrats of his era as people who try to soften the blow that the global march toward capitalism must deliver to weak Americans rather than a force trying to create a new social contract that spread the fruits of wealthy widely while preparing us all to live a very competitive economic world.

This book is, among other things, a powerful salvo in the war between Democrats over the future of the party, and therefore the nature of progressive politics in this country. Let the fight over the future of the Democratic Party - or more likely, its successor - begin in earnest.

On September 21, 1999 an earthquake that registered 7.6 rocked Taiwan. Despite the death toll of 2,400, the quake barely registered in the consciousness of most Americans.

Watching the news would lead even the most cosmopolitan American observer to conclude that people in this country were more interested in North Carolina. Hurricane Floyd dropped more than 28 inches of rain there the week before.

Yet the shock wave from the quake was felt within days. Xilinx, a highly-specialized American semiconductor designer and manufacturer, lost two of its factories that day in Taiwan. Soon, thousands of assembly-line workers located from California to Texas, were furlogued.

The chain reaction did not stop there. Wall Street traders began to place the Taiwanese natural disaster in its proper prospective. Shares of Dell, Apple and Hewlett-Packard began to tumble.

By Christmas, American shoppers were scurrying to avoid the shortages of laptop computers, Barbie cash registers and Furby dolls.

In short a disaster that only 10 years prior would have been a localized disaster, cascaded into a worldwide crisis. The Taiwanese earthquake had elevated itself into a symbol of how closely connected the world has become. Perhaps, more important, Barry Lynn, a fellow at the New American Foundation in Washington, D. C. illustrates how that out-sourced world faces different risks.

Lynn argues today's worldwide economy is an improvisation that creates and distributes wealth in ways beyond the control of its designers.

In this well-written and well-researched monograph is an at times angry look at globalization. It offers a departure from the now familiar argument that interconnected, worldwide capitalism is good. In its place, the author offers a subtle and often scary look at a risk-laden system beyond any government's control.

Lynn's arguments promise to add clarity to this nation's growing global debate.

The flip side of "The World is Flat". While US Companies are sending jobs overseas to "Cubicle Coolies" in Third World Countries for a short term return to investors and the CEO's yacht funding, American workers suffer. In the long term US companies must rely on the good will of Pakistan not to nuke their call centers in India over the Kashmir.

Lynn's book is a good look at the mindset of International Corporations who like the media today do not look at themselves as American but as World citizens. To save a little money American corporations since NAFTA have started moving jobs overseas. To justify this they are claiming they are fighting terrorism by increasing the standard of living in the third world. A $300 a month tech in India may be as good as his american counterpart in the US making $4000 but a GI Joe with Kung Fu grip costs as much in Hylalabad as it does in LA. Their standard of living isn't going to rise too much.

Lynn argues that Globalization rather than decreasing our vulnerability to terrorists is actually increasing it as means of production are moved closer to hot spot areas and Companies are dependant on third world despots (and probably the US military) to protect their interests.

He relates how both parties in the US are in bed together on the issue of globalization. He relates that the free trade positions of both Bush Administrations and that of Bill Clinton were almost in lock step. It makes one wonder if there is a politicl solution out there.

The book is very scary and I would reccomend it to those who need a reply to some of the rah rah Pro Globalization books out there.

I found this an interesting, albeit Jingoistic, account of the sharp increase in the corporate "single points of failure" and critical dependencies. It is worth reading if for no other reason than to get a better feel for how tenuous and time-critical our 1st world supply lines are. We have a more efficient economy these days. It is also far more brittle.

I found the latter half of the book more interesting, especially the author's recommendations. They are worth serious consideration. Sadly, however, I suspect that companies won't pay any attention to them until after a crisis.

This book challenges and then illuminates almost everything we think we know about today's global economy. People will be talking about Barry C. Lynn's "End of the Line" for years to come. This book is key to the current debate within the Democratic party on trade, business, jobs, outsourcing and economics. The book is extremely well written, and fun to read.

Over the past decade, globalization has been presented as a cure-all for the world's economic problems, as inevitable, or as the curse of our times. Barry Lynn offers a uniquely fresh view of the subject. He looks at the long supply line inherent in the global optimization of production and the many resulting consequences and possible vulnerabilities. This is a thinking person's examination of globalization. While this book will be of interest to corporate managers and governmental policy makers, it should be of the greatest interest to investors, whose capital is being deployed in new ways in far away places, often at great risk. Lynn writes beautifully, making an important topic clearly accessible to the general reader, and interesting.

Pat Choate

Globalization is here to stay. The movement of goods, services and knowledge across national boundaries is accelerating at an unprecedented pace thanks to factors like the internet, modern logistics and supply chain technologies, collapse of communism and reduction in tariffs. But behind this rosy picture lie many risks that have been ignored by companies for temporary gain sacrificing long term stability and national security argues this book. In the initial chapters I got the impression that the argument is primarily to protect American interests, but a full reading of the book reveals that the need and urgency to review existing sourcing strategies by major multinationals is applicable to all nations. The discussion starts will an American nationalistic fervor citing Alexander Hamilton who championed the cause for national self sufficiency in all critical supplies to win the war against the British. Unfortunately the mighty nation is now dependent on companies in other continents for critical supplies to feed its assembly or distribution processes at home. Any disruption to this critical balance can bring major corporations to a halt. As an example, an earthquake in Taiwan, the world's major manufacturer of silicon chips brought assembly lines at Dell to a crawl.

But then what made the major multinationals to place all their eggs in one basket or that matter in a few baskets far away from home ?. The author traces this fundamentally to the Japanese onslaught of the American car and electronics markets in the 80's. America had to respond. One way was to outsource manufacturing to the cheapest possible source. Asian countries like China, Taiwan and Singapore were ideal candidates with low labor costs. The cost pressure was further extended down the supply chain and soon a cost effective supply capability emerged to counter and finally overcome the Japanese threat. But in the process, argues the author, American companies have sacrificed manufacturing as a strategic tool that needs to be retained with investment and constant innovation. Companies like Cisco for example rapidly grew through global acquisitions for technology and partnering with contract manufacturers like Flextronics. Shareholders were happy, but the interests of other stakeholders like employees, consumers and national self competencies in manufacturing were sacrificed.

American dependence on China ( and vice versa) is brought out as a major risk for America. How long and how much could two nations with diametrically opposite political ideologies grow this equation is a big question.

Diversification of risk - market, financial, political and geographic are the elements of any introductory book on business strategy. This book is a call to major multinationals to brush up their elementary lessons once again.

There are clear recommendations at the end of the book to correct the course and secure the future of nations from the risks of asymmetries in the global supply chain. America for example could invoke the provisions of the Antitrust laws and limit the percentage of supplies originating from a single nation and make second sourcing mandatory. De-linking CEO compensations from short term performance is another factor that is highlighted.

The pendulum of power as of now is closer to Wall Street and far away from Washington. But the pendulum does swing as per the basic laws of physics. Back to basics is the key message from this book.

This book should not be misunderstood as a criticism of globalization. In just suggests a better and safer approach.

End of the Line by Barry C. Lynn is a delightful and interesting book about a very disturbing issue. I stumbled across this book while searching for a book with a similar name dealing with Amtrak. A critique of the global economy seemed interesting and slightly different from what I normally read.

Far from an unreasoned polemic, this book provided a fairly well reasoned and argued analysis of the weaknesses of the global supply chain. In a sense, America got a taste of these weaknesses with the disruption caused by hurricane Katrina in the fall of 2005. However, the potential shortfalls are not just limited to the handful of so-called super-ports that process the bulk of America's imports and exports. The extremely small numbers of companies that still make micro chips combined with their location in Taiwan make this a risky organization if China becomes bellicose or if Taiwan decides to be adversarial towards the United States for an extended period. These are a few examples, but the point that there is very little redundancy in a supply chain that has been made extremely lean to reduce costs. Moreover, it has created a situation where large multi-nationals bully suppliers without understanding anything about mass production. For example, does anyone really believe that Wal-Mart knows anything about the Chinese companies that make their products?

To this humble reader, we are in a very abnormal period of history where transportation costs are so low that it is extremely inexpensive to transport manufactured goods around the world. It seems likely that rising energy costs, increasing computer power and nano-technology will all combine to reverse that trend and potentially turn an individual into a thousand different factories. However, that is not the world we live in now. Mr. Lynn's analysis seems more right than wrong.

If you are interested in a well argued thesis demonstrating weaknesses in the current international business model, this is an excellent read.

In the Introduction Mr.Lynn offers a great quote based on the writings of Alexander Hamilton. "Manufacturing was key to America's independence and security. To be free, Americans must have the power to make what they need, when they need it."
For me that was the high point of this book.

He makes some sensible points about topics such as theories on the source of Clinton's trade policy with China and the possibility that Robert Reich had a strong influence on it.

Another strong point was the relationship between business and foreign policy. Consider the global trade and American imperialism.

On the Smoot-Hawley Tariff Act and the blame it has recieved for economic woes he was correct- "And so the idea that protectionism kills jobs became one of the central founding myths of the modern Democratic Party." But the author doesn't endorse protecting American jobs.

"End of the Line" examines several business strategies by such famous executives as Sam Walton and Jack Welch. Companies like GE, Cisco, and Motorola are looked at also.

One assessment that hits hard at globalism and outsourcing is the ripple effect that can easily cripple a global supply line. The "Lean" manufacturing process aka "Toyota production philosophy" is not a fixall process from my experience with it. The author details some of that process.

The book addresses the America-China business relationships with no mention of China holding a large amount of America's debt. I was surprised that it wasn't mentioned!

In summing "End of the Line" up, it does have some interesting facts about specific corporations using global outsourcing and linking politics to business. It doesn't touch on the human element like loss of American jobs or the living conditions for some labor being exploited by outsourcing.
Jeff Faux's "Global Class War" is a book I would recommend intead of "End of the Line."

The book is a wake up call about the dangers of US companies' utter reliance on outsourcing essential parts of their supply chain. Outsourcing may have been a financial boon to US corporates over the last the 20 years - it is a practice, after all, that has made it possible for US companies to deliver better value to their shareholders and cheaper products to consumers. Now, though, Barry Lynn shows us how -- much like some people are one paycheck away from financial disaster -- we are one earthquake, one hurricane, one nasty political dispute away from an economic nightmare. The potential for this is so obvious that I am amazed that no one has explored it before -at least not in such depth, detail and easy to understand terms like End of the Line does. Indeed, the aftermath of Hurricane Katrina, which is still be felt at the gas station, in our heating bills, in the cost of our groceries, is giving us a preview of the worst case scenario.