My comments are probably too late to be read, but here goes anyway. I read the book on my way to (and in) China. I think it is a "must read" but a lot of the reviewers didn't read it very closely. Tom makes it clear at the outset that his ideas are not "fully baked" and he reinforces that point in the final section (which is one of the most thought provoking). Moreover, he is using his economist background in his "voice," so when he talks about "flat" he doesn't mean in a social sense. That said, the book is a modern day "Wealth of Nations" that says most of the basis Western nations (especially the US) have used to excell economicially are being undermined, not just by technologies that have "flattened" the means of production across political boundaries, but by the "CEO class" who are the ones outsourcing not just the jobs, but the capital investment that used to say at home. Read that last line again! The "enemy" isn't low wage workers in China, it is the CEO who builds them a new plant to work in that will make them as productive as a US worker so those low wages pay off. That CEO could invest in modern factories in the US and employ US workers, but as Tom points out, they don't want to pay for health care and the social benefits US workers expect. In other words, the CEO Class is destroying the US economy, not third world workers.
I take that as a given in a "flat" economic world. But the correlary is that "wealth" will no longer accrue to those who Marx said "own the means of production" because production is now footloose and up for the lowest bid. So were will wealth be captured? In services, yes, but "Real" wealth will be captured by "branding." This is good news for Portland if it can cultivate and retain the "creatives." Unfortunately, chasing after more manufacturing and service related employers to locate here is inherently a losing strategy - in the long run (and I am not opposed to winning short run strategies if it is understood that they are NOT long run ones).
As an economist, Tom overlooked (or more likely didn't have space to deal with) two powerful trends that work against our foreign competitors. The first is the aging of the population globally. Almost all nations face a graying population that will demand more services and wealth than will be reasonably available. Of the major nations, the US faces the least risk from this trend (at least demographically, if the CEO Class and Republicans get their way with Social Security we will self-destruct as well). The second threat is the increase of "feminine" power. With the exception of Western economic powers, there is a notable loss of girls in the birth statistics as those cultures (Asian, Islamic, hard core Catholic, etc.) favor males over females. Contrary to what you would think, this gives the remaining woman MORE rather than less power because there will be more competition for them among males. Pretty clearly, these woman will use this power to react to the centuries of oppression they have faced in ways that will likely depart significantly from the current "business as usual." This may have very significant impact in combination with the aging population, as you could expect women to be more sensitive to the plight of the elderly (most of whom will also be women) than men (who given a me versus them choice will probably choose "me").
Thanks to the "Greater Generation" that aggitated in teh 1960s and 70s for social reforms, the US won't have these problems as we are not discriminating against the birth of female children and are more supportive of women's equality than most of our competitor nations. Again, Portland stands out in this regard because it has one of the nation's largest rates of female headed businesses and new female business formation.
The challenge I see, is, like Sam, in articulating a very long term vision (running to 2050) and cretaing the right environment for POrtland to benefit from the trends that will begin to overpower current trends and worries 10-20 years from now. For those who think a 40-year horizon is too long, I ask, then why do you (mostly conservative, Republican, anti-planning types) insist on a 20-year supply of land inside the Urban Growth Boundary? If you are at all honest, you will say you favor the traditional, "capitalism is smarter than any of us," just muddle along approach. But that won't cut it in the face of demographic trends, which are "destiny" in a popular phrase.