The way to the future

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Keith Hudson

Oct 20, 2014, 5:10:07 AM10/20/14
[KH: The following is in reply to an economist writing about the way politicians talk of Research and Development targets. What follows is in no way contradictory to the idea of the steady-state economy.]


You're right, of course. R&D targets are ridiculous. They should be variable in each different specialisation according to its state of maturity, or its possible opportunities. A firm making furniture can keep up-to-date with little R&D whereas one making mobile phones needs (at present) to spend a lot. However, the problem is, of course, when does a speciality or product reach its maturity?

We are likely to have no more brand-new, uniquely-new consumer goods. This has been fairly obvious since wide sales of colour television. This is not because no major manufacturing company has anything new on its drawing board (and thus why many of them are now hoarding their cash, not knowing what to do with it). That would be an irrational conclusion because we can never be certain that new ideas can't arise within any speciality.  It is rather because typical urban man and wife are now boxed-in because of energy, time and space constraints (and all our senses are fully catered to at work or leisure). Thus, the rise of the personal computer and the mobile phone has cannibalized on the sales and use of television. For example, personal heilcopters and family airplanes would be ideal consumer goods enabling economic growth to continue unabated, but there are obvious reasons why mass sales are impossible.

Man has never been so innovative as today. We have a wider choice of consumer goods than ever before, but they're all variations on the same standard consumer products (those of the very rich 300 years ago), appealing to different personalities at different social levels.  But our innovations from now onwards (and on which major chunks of R&D are now being spent) are increasingly to be found in: 1. consumer services (e.g. health and education); 2. producer goods and infrastructure (e.g. more automation of machine tools, replacement of high energy-intensive metal-based materials and structures witth super-performing carbon-chemistry replacements such as carbon fibres and, in future years, DNA-software-based machine tools (on which much research is now being done).

We are now at the beginning of a major change in the industrial revolution -- as is already being glimpsed in the advanced countries by the social and economic bifurcation going on in which highly-educated service professions are pulling away from the mass of the population in low-pay low-educated service professions and decreasing numbers of manual jobs in manufacturing.

Cole Thompson

Oct 20, 2014, 9:48:08 AM10/20/14
I think I'd broadly agree here.  I would just add two additional thoughts:

1) the rise "intellectual property" is putting a damper ( by definition secret in its impact) on innovation, at least in California.  The largest companies like it that way.  So one sees more of the garage startups being devoted to entertainment and other non-world shaking stuff.  If today one announced some new physical device for sale that had any amount of cool sophistication, the ground would begin to shake from a tsunami of IP attorneys and patent trolls running to file suit against the new gadget and its inventor.  The IEEE ran an article a few years ago on how, when one actually quantifies the rate of truly new technology, things have been slowing *down* for 30 years, not speeding up as popular wisdom holds. 
   But I agree with the core point, the vacuum to be filled by new tech is just not that large for most people.  The biggest unmet need for fully employed people is sleep.

2) Regarding highly trained providers of services, so far so good it's true.  Even here I wonder if we'll see some turmoil.  Physicians are being second guessed ("helped") by software for diagnosis, especially in larger settings where protection against lawsuits is critical ("the diagnosis was confirmed by the IntelliDoc distributed supercomputer, your honor...we fail to see how negligence can be demonstrated here").  I can see how ultimately doctors could be downgraded to Toyota factory style Anban technicians, whose main task is to hit a halt button if things seem to be going off track.

And man, the areas of investments and management are over ripe for picking by machine intelligence.  Today equity and hedge fund managers are paid shocking amounts, and in return they rarely beat the broad market over 5 years.  How long will people tolerate that?  Conventional MBA type managers are in a similar situation, they add a lot of expense to keep around, but in modern organizations they decrease efficiency and value, not add to it, so one sees companies like Google seeking to shed them wherever possible.  The practice of "management- less organization" is starting to appear on overviews of Silicon Valley waves in the Early Adopters column.  So even among service providers in high tech economies, there's reason to look over one's shoulder.  Even me.

If I were to propose an adjustment, I think I'd dwell a bit more on the advantageous position of "owners."  If one owns a large portfolio of real and intangible assets, all these trends make you better off.  The rest of us , anyone who uses their hands or head to earn a living, or is a hapless creative (artistic or technical) is in a bad way I think.

From: Keith Hudson
Sent: ‎10/‎20/‎2014 2:10 AM
Subject: The way to the future

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