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September 1, 2008

SHELF LIFE

Forward editors review the latest books on business, economics and trade.

By Richard C. Longworth
Bloomsbury USA, 2008
$25.95

Caught in the Middle: America’s Heartland in the Age of Globalism

What happens to America happens to the Midwest first—and so far globalization has destroyed more in the heartland than it’s created. So argues former Chicago Tribune reporter Richard C. Longworth in this compelling book about the impact of a globalized age on the fabric of the U.S. region historically associated with stability and rootedness.

Certainly, from the mid-1800s to the mid-20th century, the Midwest was considered the engine of the country, a center of American innovation, both a manufacturing and an agricultural dynamo. But beginning in the 1970s, its economy began a decline that turned into a free-fall. Today, writes Longworth, “the industrial Midwest amounts to a wasteland of empty factories, corroding cities and crumbling neighborhoods.”

Not a pretty picture, and one that in large part the region brought upon itself. Towns dependent on one corporation were built on one good idea that sustained them for decades. Why change an accommodation between big business and big unions that created an industrial middle class that lived at a level never before achieved by a blue-collar population? Who could argue with success? And the region’s farmers, tilling highpriced land in an economic and social framework formed in the 19th century, have been undone by a new world order that has pit them against farmers in countries like Brazil who are creating a 21st century structure—cheap labor, land, shipping, processing—out of virgin soil.

The author doesn’t offer many panaceas for the future, yet there are ways that the region can ease, if not eliminate, its pain. First, the Midwest—defined more by history, economic structure and a state of mind rather than state lines—must begin to think and act regionally. New England and the South have learned to do this. So has California, a region unto itself. The Midwest also needs to establish a think tank devoted to Midwestern issues: how to turn down-and-out industrial cities into modern regional centers, the role of bioscience in the region’s economic future and the need to shore up the region’s education system, for example.

The rest of the United States should pay heed. If, as Longworth claims, the Midwest is the bellwether of America, then once again, the Midwest is the place where the next American future will be created. All Americans have a stake in what happens there.

 

By William Nordhaus
Yale University Press 2008
$28

A Question of Balance: Weighing the Options on Global Warming Policies

Nordhaus is an economist, and A Question of Balance views the globalwarming issue through the eyes of an economist. His concern is not with the science of global warming, but rather the effectiveness of various policies for the allocation of economic resources in response to global warming. Using a single computer model, he calculates aggregated expenditures, costs and gains to the world economy year by year. Complicated stuff, but Nordhaus presents the data in an easily digestible manner, complete with graphs and tables. For those not interested in the mathematical details, an early chapter, “Summary for the Concerned Citizen,” contains a clear summary of his results and their practical consequences.

 

By Matthew S. Olson and Derek Van Bever
Yale University Press 2008
$27.50

Stall Points

This timely book explores “the moment in time that best represents a turning point, or significant downturn, in corporate growth revenue”—the stall point. The majority of the book is devoted to explaining the root cause of growth stalls, based on research of 500 companies. The authors’ conclusions: It’s common to stall, difficult to see a stall coming and extremely difficult to recover from a stall. In fact, 76% of the companies studied never restarted after a stall point. However, stall points are typically strategic or organizational in nature and, therefore, controllable. The book provides self-tests so readers can assess the extent to which root causes exist in their companies.