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The Future Is Getting Better All The Time

W. Brian Arthur, in a report for McKinsey, writes that we are witnessing enormous fundamental changes to the global economy: “in fact”, he writes, “it may well be the biggest change ever in the economy.” This change is due to what Arthur calls “the second economy” or a “digital economy” that exists alongside the physical economy. It goes beyond the changes the media is fond of discussing: the rise of social media, mechanization, and the movement of job opportunities to Asia. Writes Arthur,

Now this second, digital economy isn’t producing anything tangible. It’s not making my bed in a hotel, or bringing me orange juice in the morning. But it is running an awful lot of the economy. It’s helping architects design buildings, it’s tracking sales and inventory, getting goods from here to there, executing trades and banking operations, controlling [the] manufacturing [of] equipment, making design calculations, billing clients, navigating aircraft, helping diagnose patients, and guiding laparoscopic surgeries. Such operations grow slowly and take time to form. In any deep transformation, industries do not so much adopt the new body of technology as encounter it, and as they do so they create new ways to profit from its possibilities…

I think that for the rest of this century, barring wars and pestilence, a lot of the story will be the building out of this second economy, an unseen underground economy that basically is giving us intelligent reactions to what we do above the ground. For example, if I’m driving in Los Angeles in 15 years’ time, likely it’ll be a driverless car in a flow of traffic where my car’s in a conversation with the cars around it that are in conversation with general traffic and with my car. The second economy is creating for us—slowly, quietly, and steadily—a different world.

Quite so. Those who wring their hands and moan about the good old days are utterly and totally out of synch with the dynamism and sheer, explosive opportunity of the present day.  While humanity faces a host of dangers, short term and long, we are simultaneously moving into an unparalleled era of opportunity.

Our world is changing; that’s one of the foundational goals of this blog: to take daily news and developments in the global political economy and put them in their place in the grand mosaic of our time.

Capitalism marginalizes those who do not understand the world and how it is changing, and gives opportunities to those who do. No one knows what our economy will look like in twenty years time, but those who can think about the world intelligently now, recognize new opportunities, and seize the initiative, can grow into global leaders down the road, fundamentally changing our politics, businesses, and way of life.

And on a more practical note, they will invent the jobs of the future and build the careers of the future.

The fundamental fact about the emerging new economic order is that it is going to be a much richer world than the old blue social model could ever offer.  The vastly enhanced efficiency of manufacturing, energy use and organization that the information revolution brings with it means that human beings will spend much less energy and time on fulfilling their basic biological needs, and much more time exploring and fulfilling more complex and personal goals.  As a species, we will spend less time in the coal mines and more time in the theater, less time chopping cotton and more time writing novels.

Reshaping our social institutions and our mental habits to capitalize on the vast and unprecedented opportunities of the information revolution is going to take a lot of time, energy and creativity.  The pain and drama of the shift will absorb our political system — and painful as it will be in the US, it is likely to be still more disruptive and difficult elsewhere.

But unless we get it profoundly wrong, these are birth pangs, not death agonies.  The millennial generation will build a new world, and it will be an extraordinary place.

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  • J R Yankovic

    “The vastly enhanced efficiency of manufacturing, energy use and organization that the information revolution brings with it means that human beings will spend much less energy and time on fulfilling their basic biological needs, and much more time exploring and fulfilling more complex and personal goals. As a species, we will spend less time in the coal mines and more time in the theater, less time chopping cotton and more time writing novels.”

    At the same time, 21st-century Man appears to have this ever-more-demanding, MAN-given need to supersede himself with – perhaps even to sacrifice himself to? – his own artifices. Things that seem to bear more and more of his own exclusive (fallen?) imprint, and less and less the imprint of anything else, whether natural or Divine. At least so far they don’t SEEM to be anything like the way God creates – or even cultivates – us. For instance, are we becoming – or even likely to become – more patient? More merciful? Or shall we be facing more social and career pressure to become just the opposite?

    And if what I’ve described is more nearly where we are going (given present trends), what might be in it for us unenhanced humans? A kind of secular “vicarious” immortality? Sort of a “Who cares where we go when we die? It’s how much we leave behind us when we go that counts”?

    If the economic culture of the past 15 or so years is any indicator – and I sincerely hope it isn’t – then we as a species will spend less and less time and energy fulfilling either biological needs or complex and personal goals, and more and more time at the merciless, utterly demanding disposal of all the wondrous things – tasks, procedures, systems, organizations, technologies, intelligences – that we create.

    And then think how Lenin, Mao, perhaps even H G Wells (at least in his later years) would be proud of us!

  • Scott

    Thank you. There are times when I read your posts that I believe you have slipped over to the dark side and think all is lost. You accurately and incisively bring together important trends found in news reports from across the globe. However, your accurate portrayal of the dangers we face could lead one to think that we are a hopeless species with no chance of getting it right.

    Yet I am the beneficiary of your all too short-lived daily blog “The Long Recall.” Your daily view of the civil war in, as you put it, real time as seen through the eyes of the people who actually lived it was a graduate degree in context. News would filter through daily. Some of it was accurate, much was not and it was almost impossible for most people to see more than shadows of what was really happening.

    Every human has been pretty sure that the time they are living in is the most important ever and that the dangers they face are the greatest ever. It makes sense because to each person their time is the only time they actually experience. Yet, as your Long Recall showed, their time is the one they probably understand the least.

    Your last paragraph, “But unless we get it profoundly wrong, these are birth pangs, not death agonies. The millennial generation will build a new world, and it will be an extraordinary place” should be written on every chalk board, white board, iPad or whatever a child stares at each day.

    It carries the message that the future can be screwed up but also makes it clear that the future can be profoundly promising. As with the 1860’s, it all depends on what individuals step forward and do. They must understand what is happening in the world but they cannot be scared. It is fear that will screw up the future.

    I’m not trying to weaken your curmudgeon credentials but your message is an important one.

  • dr kill

    I agree with your summation. I would only add that too much energy and money is wasted by both wings of American culture attempting to return to some scrubbed and fantasized yesterday.
    Life is change, ride the wave or drown in the past. I’m having so much fun being 57 I can’t wait to be 58.

  • ms

    I appreciate this post and the comments. Technology is indeed wonderful, but it is also soulless. It is tempting to think that it can conquer any problem, but in fact, needs to be used with wisdom. Two words–nuclear Iran–demonstrate this truth. In essence, many of the things that seem stodgy and out-of-date in a high-tech world–religion, philosophy, history, ethics, tradition–are the tools that best help us navigate that world in an ethical way that will allow it to be used to help instead of harm mankind.

  • J R Yankovic

    Ahhhhh, the sweet(?) smell of Technoparadise. We’ve yet to achieve it . . .

    “Whaddaya mean? It’s ALWAYS being achieved. The opportunity’s ALWAYS there for those with the GUTS AND GUMPTION to take hold of it. And don’t tell me the RIGHT people don’t always succeed. Just you wait. In a SMART world, unproductive naysayers like you will be left to die by the roadside. Why, you’re not even FIT to live . . . ”

    . . . and God help us all when we do.

  • Jack

    I wish I could find me a pair of WRM’s rose-colored glasses.

    The prophets of the information age have been saying for years that our lives would become more prosperous and relaxed thanks to the wonder of digital technology. Indeed, some such pundits in the 1980s said that the time of technology fueled prosperity would be upon us by the year 2000! Obviously, it didn’t happen.

    I would also observe that the West’s loss of manufacturing capacity and its inexorable population aging are not problems that technology will easily remedy.

    I think Mead ultimately has it wrong. It’s surely overly optomistic to say that the future will be wonderful unless we get it profoundly wrong. It would be more accurate to say that the future will be the decline of Detroit writ large, unless we get profoundly lucky.

  • Fred

    Jack is a wise man.

  • Toni

    @Jack – please substantiate this comment:

    “Indeed, some such pundits in the 1980s said that the time of technology fueled prosperity would be upon us by the year 2000! Obviously, it didn’t happen.”

    No, it’s not obvious at all. By “technology fueled prosperity,” do you mean a roaring economy forever and ever, no downturns ever again? If so, why did you give those pundits the slightest credence?

    Even in the Great Recession, GDP and almost every other economic indicator is well above the level of the 1980s. Other improvements include the expiration of the Evil Empire (partly due to its inability to keep up in computers); a Third World communication revolution (that’s technology) spurring new microbusiness opportunities; and better health care thanks to — yes! — the medical-technological feat of decoding the human genome, as well as vast advances in medical imaging technology, e.g., fMRI.

    No wave of technological change will magically make everything better forever, including the economy. But they’ve demonstrably made some things better. Which of the aforementioned technological innovations would you like to do without?

    In these gloomy doomy days I’m glad Dr. Mead and others seek positive possibilities the doom-mongers overlook. Times are never as awful or as fabulous as they seem at the moment.

  • Jim.

    One might be tempted to believe that the future involves a society where the mass-production of our factories, unprecedented in human history, is shared out amongst the population without their having to labor for it. They would write novels (or blogs) that few would read and from which even fewer would gain any insight or illumination, spend hours upon hours in Greek cafe’s while their government jobs paid them to do very little, and spend more time in their home theaters (watching increasingly unwatchable movies).

    Don’t get me wrong; worthy novels still exist. (Though sadly, Patrick O’Brien is dead.) Worthy blogs, obviously. The Oregon Shakespeare Festival is still running. But given leisure, few spend it on these things.

    We are IN the future you describe … and it IS going wrong. Or maybe it’s going as right as one can ever expect it to, I don’t know.

    For the last century or more, the trends you describe lead directly to the Blue Social Model — or in some cases Communism, as that past rose-colored futurist Marx convinced too many people. Maybe material expectations just outpace our ability to fulfill them, no matter how great our abilities get.

    The potential for information delivery has been altered profoundly, that much is clear. I can travel to a place I’ve never been with a smartphone in my pocket, without having planned out my itinerary in any way. Don’t know what roads to take to the airport? No problem, figure it out while you’re waiting at a stoplight! No idea where the restaurants are that would satisfy whatever whim or craving? No worries, a quick search will come up with something! Want to find a team of a half-dozen people intensely interested in the same project you are, and collaborate with them conveniently and effectively even across a continent, or across the world? Sure, just make sure you remember what time zone they’re in when you call them.

    But the new efficiencies are in fact quite small. In fact, many of them come with considerable new costs. Information no one ever asked for before, as it was plainly too much effort to collect, is now required — no time saved there. So many resume’s are received that resume’s without the proper keywords now never meet a set of human eyes, and good people go without jobs, and good-paying jobs go unfilled due to a “lack of qualified candidates”. Lack of face-to-face contact is alienating, and frequently not as effective for getting things done or keeping people on-task as meeting in person at an office every day. Oh, and don’t forget all the time spent playing Solitaire in this Brave New World.

    It’s almost as if humanity was not growing to become perfect, despite the progress around us. Who’s have thought?

  • Jack

    Peter Thiel, co-founder of PayPal and now a professional investor, has a good article in National Review (dated October 3) entitled “The End of the Future”, in which he highlights the fact (oft repeated by many other commentators) that real wages and incomes have been stagnant for nearly forty years!

    As such, he says that the macro economic effect of all the dizzying technological progress that we have made in that time is that we (and our computers) are having to run ever faster just to stay in the same place!

    How exactly do WRM and Toni anticipate that this situation will change markedly for the better in the future?

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