Globalization's Vulnerabilities

Good article by Demir Barlas at Line 56: So far, the U.S. business community has been more aware of globalization's benefits than its liabilities. This is a natural attitude, because the liabilities have, for the most part, not yet manifested themselves. But the recent bomb blasts in Mumbai, India may begin to put the issue of network vulnerability front and center.

Comments

[Kevin]

I've long believed that "infrastructure" issues would prove to be the Achilles’ heel of global outsourcing. Since I'm _not_ John Robb ;), I thought that the lack of a first world health care system would bring down India.

I guess the big question is how much damage a massive economy like India's can take before it starts to affect off-shored operations. Indiscriminate attacks against general infrastructure - like the train bombing - will be painful but targeted attacks against the first world off-shore enclaves and operations could product a more drastic result.

Here's a open-source attack you might like, John. Create (or boost prices in) a market for telecom scrap and surplus in cities with major off-shore operations. I'm thinking of the problems 3rd world nations have had in creating a wired infrastructure because of copper stealing. Let the legion of desparately poor Indians pick away at the telecom infrastructure until it collapses.

[Yudel]

A 10% terror tax? But if the guerrillas are global too, there's no guarantee that relocation will spare you that.

Are there countries immune to the threat?

Primarily, I would imagine, those with a single, strongly-knit ethnic group.

Disengagement (from Gaza, Lebanon, Kashmir) is step one.

Expulsion is step two. The U.S. has taken the lead in shredding the post-WWII Geneva regime. I suspect the Israeli perspective had at least some impact in Administration thinking. Carter-era Human Rights foreign policy is being shredded by our debt to China.

Step three will be ending Reagan's war on drugs. Aging baby boomers demanding pot with their chemo will return the discussion to moral relativism... at which point the American middle class will decide they'd rather flood the cities with legal heroin than continue to fund terrorists in Afghanistan and elsewhere.

Bottom line: Israel has survived its (10%? 20%? 30%?) terror tax. So will India. Both are at their heart viable ethnic entities. China, however, will have a much tougher go at it.