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In his new book, Thomas L. Friedman, the Pulitzer Prize-winning New York Times columnist, argues that epochal political events and technology have fundamentally redefined the planet. By removing ideological barriers and flattening economic command structures, the earth has turned itself into a wired and compacted playing field -- a flat earth. A drastically shrinking planet has entered a new stage that Friedman calls Globalization 3.0.

How America responds to these forces is central to any politics of the new century. "Economic stability is not going to be a feature of the flat world," Friedman writes. To maintain American competitiveness in an explosively changing economic climate, he calls for a policy of "compassionate flatism" that seeks to move from a culture of lifetime employment -- the old industrial model -- to one of lifetime employability. To achieve this will require changes in domestic policies toward education, health care, portable pensions, capital ownership, and the work-family balance.

Making fundamental changes calls for bold leadership that is conspicuously absent from some of the boneheaded policy choices of the Bush administration -- such as cutting the budget of the National Science Foundation. But many politicians, says Friedman, lack a basic understanding of global flattening and its potential effects. This has led to "a quiet crisis" that should alarm policymakers. Now, he writes, is the time to begin living in a new era of "creative destruction on steroids."

To meet the challenges of flatism requires as comprehensive, energetic, and focused a response as did meeting the challenge of communism during the Cold War. It requires a president who can summon the nation to get smarter and study harder in science, math, and engineering in order to reach the new frontiers of knowledge that the flat world is rapidly opening up and pushing out. And it requires a Great Society that commits our government to building the infrastructure, safety nets, and institutions that will help every American become more employable in an age when no one can be guaranteed lifetime employment. I call my own version of this approach compassionate flatism.

Getting Americans to rally around compassionate flatism is much more difficult than getting them to rally around anticommunism. When it comes to responding to the challenges of the flat world, there is no help line we can call. We have to dig into ourselves. We in America have all the tools to do that, but we have not been tending to those tools as we should. The assumption that because America's economy has dominated the world for more than a century, it will and must always be that way is as dangerous an illusion today as the illusion that America would always dominate in science and technology was back in 1950. Getting our society up to speed for a flat world is going to be extremely painstaking. We are going to have to start doing a lot of things differently. It is going to take the sort of focus and national will that President John F. Kennedy called for in his famous May 25, 1961, speech to Congress on "urgent national needs" -- at a time when America was recovering from the twin shocks of Sputnik and the Soviet space launch of a cosmonaut.

"I believe we possess all the resources and talents necessary," said President Kennedy. "But the facts of the matter are that we have never made the national decisions or marshaled the national resources required for such leadership. We have never specified long-range goals on an urgent time schedule. ..."

We too have to do things differently. We are going to have to sort out what to keep, what to discard, what to adapt, what to adopt, where to redouble our efforts, and where to intensify our focus. The flattening of the world is going to be hugely disruptive to both traditional and developed societies. The weak will fall farther behind faster. The traditional will feel the force of modernization much more profoundly. I worry, because so much political stability is built on economic stability, and economic stability is not going to be a feature of the flat world. The disruptions are going to come faster and harder. Think about Microsoft trying to figure out how to deal with a global army of people writing software for free! We are entering an era of creative destruction on steroids.

Leadership. The job of the politician in America should be to help educate and explain to people what world they are living in and what they need to do if they want to thrive within it. One problem we have today, though, is that so many American politicians don't seem to have a clue about the flat world. I am not saying we should require all politicians to hold engineering degrees, but it would be helpful if they had a basic understanding of the forces that are flattening the world, were able to educate constituents about them and galvanize a response. We have way too many politicians in America today who seem to do the opposite. It is hard to have an American national strategy for dealing with flatism if people won't even acknowledge that there is an education gap emerging and that there is an ambition gap emerging and that we are in a quiet crisis. For instance, of all the policy choices that the Republican-led Congress could have made in forging the FY 2005 budget, how in the world could it have decided to cut the funding of the National Science Foundation by more than $100 million?

We need politicians who are able and willing to both explain and inspire. And what they most need to explain to Americans is pretty much what Lou Gerstner explained when he took over as chairman of IBM in 1993, when the company was losing billions of dollars. He told IBM that a strategy built largely around designing and selling computers -- rather than the services and strategies to get the most out of those computers for each customer -- didn't make sense. Needless to say, this was a shock for IBMers.

"Transformation of an enterprise begins with a sense of crisis or urgency," Gerstner told students at Harvard Business School, in a December 9, 2002, talk. "No institution will go through fundamental change unless it believes it is in deep trouble and needs to do something different to survive." It is impossible to ignore the parallel with America as a whole in the early twenty-first century.

When Lou Gerstner came in, one of the first things he did was replace the notion of lifetime employment with the notion of lifetime employability. As at IBM, so in America. Average Joe has to become special, specialized, or adaptable Joe. The job of government and business is not to guarantee anyone a lifetime job -- those days are over. That social contract has been ripped up with the flattening of the world. What government can and must guarantee people is the chance to make themselves more employable. We don't want America to be to the world what IBM was becoming to the computer industry in the 1980s: the people who opened the field and then became too timid, arrogant, and ordinary to play on it. We want America to be the born-again IBM.

Replacing fat with muscles. Since lifetime employment is a form of fat that a flat world simply cannot sustain any longer, compassionate flatism seeks to focus its energy on how government and business can enhance every worker's lifetime employability. Lifetime employment depends on preserving a lot of fat. Lifetime employability requires replacing that fat with muscle. The social contract that progressives should try to enforce between government and workers, and companies and workers, is one in which government and companies say, "We cannot guarantee you any lifetime employment. But we can guarantee you that government and companies will focus on giving you the tools to make you more lifetime employable." The whole mind-set of a flat world is one in which the individual worker is going to become more and more responsible for managing his or her own career, risks, and economic security, and the job of government and business is to help workers build the necessary muscles to do that.

The "muscles" workers need most are portable benefits and opportunities for lifelong learning. The more the workforce feels mobile -- in terms of health care, pension benefits, and lifelong learning possibilities -- the more it will be willing and able to jump into the new industries and new job niches spawned by the flat world and to move from dying companies to thriving companies.

Creating legal and institutional frameworks for universal portability of pensions and health care -- in addition to Social Security, Medicare, and Medicaid -- will help people build up such muscles. Today roughly 50 percent of Americans don't have a job-based pension plan, other than Social Security. Those who are fortunate enough to have one cannot easily take it with them from job to job. What is needed is one simple universal portable pension scheme, along the lines proposed by the Progressive Policy Institute, that would get rid of the confusing welter of sixteen different tax-deferred options now offered by the government and consolidate them all into a single vehicle. This universal plan, which you would open with your first job, would encourage workers to establish 401(k) tax-deferred savings programs. Each worker and his or her employer could make contributions of cash, bonuses, profit sharing, or stock, depending on what sorts of benefits the specific employer offered. These assets would be allowed to build up tax-free in whatever savings or investment portfolio options the worker chose. But if and when it came time to change jobs, the worker could take the whole portfolio with him or her and not have to either cash it out or leave it under the umbrella of the previous employer. Rollover provisions do exist today, but they are complicated and many workers don't take advantage of them because of that.

In addition to a simple, portable, and universal pension program, Will Marshall, president of the Progressive Policy Institute, proposes legislation that would make it much easier and more likely for workers to obtain stock options in the companies for which they work. Such legislation would give tax incentives to companies to give more workers more options earlier and penalize companies that do not. Part of making workers more mobile is creating more ways to make more workers owners of financial assets, not just their own labor. "We want a public that sees itself as stakeholders, sharing in the capital-creating side of the flat world, not just competing in global labor markets," argued Marshall. "We all have to be owners as well as wage earners. That is where public policy has to be focused -- to make sure that people have wealth-producing assets as they enter the twenty-first century, the way homeownership accomplished that in the twentieth century."

Why? Because there is an increasing body of literature that says people who are stakeholders, people who have a slice of the pie, "are more deeply invested in our system of democratic capitalism and the policies that keep it dynamic," said Marshall. It is another way, besides homeownership, to underpin the legitimacy of democratic capitalism. It is also another way to energize it, because workers who are also owners are more productive on the job. Moreover, in a flat world where every worker is going to face stiffer competition, the more opportunities everyone has to build wealth through the power of markets and compounding interest, the more he or she will be able to be self-reliant. We need to give workers every stabilizer we can and make it as easy for them to get stock options as it is for the plutocrats. Instead of just being focused on protecting those with existing capital, as conservatives so often seem to be, let's focus instead on widening the circle of capital owners.

On the health-care side, I favor the type of portable health-care program proposed by PPI. The idea is to set up state-by-state collective purchasing pools, the way Congress and federal employees now cover themselves. These pools would set the rules and create the marketplace in which insurance companies could offer a menu of options. Each employer would then be responsible for offering this menu of options to each new employee. Workers could choose high, medium, or low coverage. Everyone, though, would have to be covered. Depending on the employer, he or she would cover part or all of the premiums and the employee the rest. But employers would not be responsible for negotiating plans with insurance companies, where they have little individual clout.

The state or federal pools would do that. This way employees would be totally mobile and could take their health-care coverage wherever they went. This type of plan has worked like a charm for members of Congress, so why not offer it to the wider public? Needy and low-income workers who could not afford to join a plan would get some government subsidy to do so. But the main idea is to establish a government-supervised, -regulated, and -subsidized private insurance market in which government sets the broad rules so that there is no cherry-picking of healthy workers or arbitrary denial of treatment. The health care itself is administered privately, and the job of employers is to facilitate their workers' entry into one of these state pools and, ideally, help them pay for some or all of the premiums, but not be responsible for the health care themselves. In the transition, though, employers could continue to offer health-care plans as an incentive, and workers would have the option of going with either the plan offered by their employers or the menu of options available through the state purchasing pools. (For details, go to ppionline.org.)

One can quibble about the details of any of these proposals, but I think the basic inspiration behind them is exactly right: In a flattening world, where worker security can no longer be guaranteed by Fortune 500 corporations with top-down pension and health plans, we need more collaborative solutions -- among government, labor, and business -- that will promote self-reliant workers but not just leave them to fend for themselves.

When it comes to building muscles of employability, government has another critical role to play -- in education. As American society produced more higher-skilled people by making high school mandatory, it empowered more people to get a bigger slice of the bigger, more complex economic pie. As the 20th century progressed, we added, on top of the high school movement, the GI Bill and the modern university system.

"These were big ideas," noted Stanford University Economist Paul Romer, "and what is missing at the moment is a political imagination of how do we do something just as big and just as important for the transition into the twenty-first century as we did for the nineteenth and twentieth." The obvious challenge, Romer added, is to make tertiary education, if not compulsory, then government-subsidized for at least two years, whether it is at a state university, a community college, or a technical school. Tertiary education is more critical the flatter the world gets, because technology will be churning old jobs, and spawning new, more complex ones, much faster than during the transition from the agricultural economy to the industrial one.

Educating more people at the tertiary level has two effects. One is that it produces more people with the skills to claim higher-value-added work in the new niches. And two, it shrinks the pool of people able to do lower-skilled work, from road maintenance to home repair to Starbucks. By shrinking the pool of lower-skilled workers, we help to stabilize their wages (provided we control immigration), because there are fewer people available to do those jobs. It is not an accident that plumbers can charge $75 an hour in major urban areas or that good housekeepers or cooks are hard to find.

Immigration. While we need to redouble our efforts to build the muscles of each individual American, we have to continue to import muscles from abroad as well. Most of the Indian, Chinese, Russian, Japanese, Korean, Iranian, Arab, and Israeli engineers, physicists, and scientists who come to work or study in the United States make great citizens. They are family-oriented, educated, and hardworking, and most would jump at the chance to become an American. They are exactly the type of people this country needs, and we cannot let the FBI, CIA, and Homeland Security, in their zeal to keep out the next Mohammed Atta, also keep out the next Sergey Brin, one of the cofounders of Google, who was born in Russia.

I would favor an immigration policy that gives a five-year work visa to any foreign student who completes a Ph.D. at an accredited American university in any subject. I don't care if it is Greek mythology or mathematics. If we can cream off the first-round intellectual draft choices from around the world, it will always end up a net plus for America. If the flat world is about connecting all the knowledge pools together, we want our knowledge pool to be the biggest. Said Bill Brody, the president of Johns Hopkins, "We are in a global talent search, so anything we can do in America to get those top draft choices we should do, because one of them is going to be Babe Ruth, and why should we let him or her go somewhere else?"

Parenting. No discussion of compassionate flatism would be complete without also discussing the need for improved parenting. Helping individuals adapt to a flat world is not only the job of governments and companies. It is also the job of parents. They too need to know in what world their kids are growing up and what it will take for them to thrive. Put simply, we need a new generation of parents ready to administer tough love: There comes a time when you've got to put away the Game Boys, turn off the television set, put away the iPod, and get your kids down to work.

The sense of entitlement, the sense that because we once dominated global commerce and geopolitics -- and Olympic basketball -- we always will, the sense that delayed gratification is a punishment worse than a spanking, the sense that our kids have to be swaddled in cotton wool so that nothing bad or disappointing or stressful ever happens to them at school is, quite simply, a growing cancer on American society. And if we don't start to reverse it, our kids are going to be in for a huge and socially disruptive shock from the flat world. While a different approach by politicians is necessary, it is not sufficient.

David Baltimore, the Nobel Prize-winning president of Caltech, knows what it takes to get your child ready to compete against the cream of the global crop. He told me that he is struck by the fact that almost all the students who make it to Caltech, one of the best scientific universities in the world, come from public schools, not from private schools that sometimes nurture a sense that just because you are there, you are special and entitled. "I look at the kids who come to Caltech, and they grew up in families that encouraged them to work hard and to put off a little bit of gratification for the future and to understand that they need to hone their skills to play an important role in the world," Baltimore said. "I give parents enormous credit for this, because these kids are all coming from public schools that people are calling failures. Public education is producing these remarkable students -- so it can be done. Their parents have nurtured them to make sure that they realize their potential. I think we need a revolution in this country when it comes to parenting around education."

Clearly, foreign-born parents seem to be doing this better. "About one-third of our students have an Asian background or are recent immigrants," he said. A significant majority of the students coming to Caltech in the engineering disciplines are foreign- born, and a large fraction of its current faculty is foreign-born. "In biology, at the postdoc level, the dominance of Chinese students is overwhelming," said Baltimore. No wonder that at the big scientific conferences today, a majority of the research papers dealing with cutting-edge bioscience have at least one Chinese name on them.

My friends Judy Estrin and Bill Carrico have started several networking companies in Silicon Valley. "When I was eleven years old," said Bill, "I knew I was going to be an engineer. I dare you to find an eleven-year-old in America who wants to be an engineer today. We've turned down the ambition level." Added Judy, "Ambition comes from the parents. People have to get it. It will probably take a crisis [to get us refocused]."

I would simply add: The crisis is already here. It is just playing out in slow motion. The flattening of the world is moving ahead apace, and barring war or some catastrophic terrorist event, nothing is going to stop it. But what can happen is a decline in our standard of living, if more Americans are not empowered and educated to participate in a world where all the knowledge centers are being connected. We have within our society all the ingredients for American individuals to thrive in this world, but if we squander those ingredients, we will stagnate.