
Has the ideas machine broken down? - mindcrime
http://www.economist.com/news/briefing/21569381-idea-innovation-and-new-technology-have-stopped-driving-growth-getting-increasing
======
dkulchenko
I assure you, it has not.

Sometimes it's hard to look past TechCrunch and the endless SaaS/CRUD apps,
but we're in the middle of a technological revolution right now. Platforms
like Kickstarter are driving innovation like never before, pushing forward
ideas that would have never seen the light of day otherwise. The new tech
coming out of the machine is awe-inspiring.

Even as a tiny, tiny sample of what's happening out there: Google's making
self-driving cars, healthcare is advancing by leaps and bounds, and portable
electronics have changed the way we live our lives over the course of but 5
years.

Google Glass? Oculus Rift? Leap Motion? MYO? All tech that would simply blow
your mind just 10 years ago, but we're practically taking it for granted
today. I'm typing this on a thin glass slab, for Christ's sake, this is
something out of Star Trek.

If you're struggling to see innovation, you aren't looking hard enough.

~~~
tomjen3
There is no inovation in health care. We can't grow organs, we are still dying
of hearth diease and diabetes.

Doctors know how important exercise is but keep turning out study after study
on the subject instead of figuring out how to get the same effects in a pill.
They don't even want to cure cancer, prefering ever more expensive treatments.

You talk Star Trek, at this point I would be impressed with a goddamm
hypospray. Tech companies have made it possible to get live video from the
other side of the planet, it is about time the rest of the sectors step up.

~~~
krapp
_we are still dying of hearth diease and diabetes._ We're dying of everything
it's possible to die from. Nevertheless far fewer people are dying of heart
disease and diabetes than ever.

 _Doctors know how important exercise is but keep turning out study after
study on the subject instead of figuring out how to get the same effects in a
pill._ Human biology is not subject to Moore's Law. There will never be a pill
which encapsulates the effect of getting some exercise.

 _They don't even want to cure cancer, prefering ever more expensive
treatments._ Or maybe cancer is complex and those ever more expensive
treatments _are_ as close to a cure as we can come right now, providing the
very idea of 'a cure for cancer' isn't a misunderstanding of the nature of the
problem.

~~~
spikels
I certainly do get the sense that medical progress has stalled. Perhaps all
the "low hanging fruit" has been picked and future progress will be much
harder.

As the article mentions antibiotics were both a lot easier to develop and had
a much bigger impact than genomic research - at least so far. It sure seems
like we have made very little overall progress even on targeted diseases, such
as cancer, despite vastly increased spending. Spending on both healthcare and
healthcare research have roughly doubled in nominal dollars since 2000 with
little overall impact.

I understand that, at least in the US, healthcare is fundamentally broken -
results have little connection to costs. But is this enough to be holding back
the entire economy? Is tech's impact really just smaller than we think? And
are other sectors, especially government activites, also lagging behind and
thus dragging down overall performance?

~~~
krapp
_Perhaps all the "low hanging fruit" had been picked and future progress will
be much harder._

I think that might have something to do with it. Maybe there's only so far you
can go in reducing the cost or complexity of some of the problems medicine has
to solve now, or maybe the money in research goes first to the treatments
which turn the biggest profit for hospitals?

Also I wonder whether the progress in the tech sector isn't just more visible
than progress in medicine. It's a lot easier to see the way the iPod has
iterated over a decade than, say, to see the way genetic screening has. Though
of course medicine and tech are inextricably linked, maybe it would be better
to say 'medical tech' versus 'consumer tech.'

And of course there's the issues of religion and politics. If we could say,
clone ready-made human organs for transplant, just handwaving away the
'growing them' part, how long would the technology be held back by public and
political squeamishness about the process itself? If it requires something
akin to industrial, mass-production of living human tissues and stem cells?
Even if it saved a million lives tomorrow, it might take decades to pass into
a level of public tolerance that makes it politically acceptable to fund the
research.

------
InclinedPlane
This is actually the reverse effect, I think, disruption blindness. Disruption
has become so commonplace that we've started to call it complete even when
it's in its early stages (such as the current PC revolution). And we've become
used to a rapid pace of massive disruption. So even while we're in the midst
of several big transformative changes to the world wrought by technology, we
get impatient. Why isn't the entire world being revolutionized EVERY year? Has
the pace of development slowed down?

Just calm down and readjust your perspective.

Consider even just the tablet revolution, which has only just started. The low
parts count of tablets makes them ideal low cost computers. The long battery
life makes them perfect for use in areas without ubiquitous electrical power.
And the intuitive touch based interfaces make them perfect for use even by
people who aren't literate. Over the next 20-30 years we're going to see a
massive acceleration in the diffusion of computing technology into the
developing world. Which will have a huge impact on education, communication,
economics, and industry. This will be one of the most profound things to
happen in the history of humanity, but nobody's paying enough attention
because everyone in tech journalism has the IQ and attention span of a gnat.

Meanwhile, over the same time frame increases in computing power are going to
be a key element in the rise of fully configurable and fully automated
manufacturing, as well as automated long-distance transportation (not just
driverless cars), and a strong transition away from mass production as we've
known it. All of which will transform the economy and society in ways we can
scarcely imagine today. That's not even to mention the rise in space
exploration, exploitation, and colonization that is in the midst even as we
speak. The world of 2050 will be more futuristic and unfamiliar to the people
of 2013 than the fictional futures of Star Trek or Blade Runner.

~~~
graycat
"everyone in tech journalism has the IQ and attention span of a gnat"

I take great offense and strongly object to your unwarranted, unjustified,
uninformed, misinformed, just plain wrong insult of good and innocent
gnats!!!!

------
yesbabyyes
As others are saying, there is a lot of innovation going on. However, I
propose that the "digital economy" is quite different from anything we are
used to.

The productivity gains are not necessarily such that they contribute to growth
-- at least, not they way we are used to measure it.

It seems that two of the big effects of the Internet is removing rentiers and
middlemen, and lowering costs across the board, the first because, well,
_connecting people_ , the second because of multiplicative efficiency
increases.

This enables smaller organizations to capture a bigger part of a smaller pie.
This is most visible in strictly informational sectors, such as free software,
music and publishing, but I don't think it's constrained to that but rather
the effect of adding "intelligence". The end game of a company like AirBnB for
instance, is to replace (all) hotels, for a fraction of the turnover (but
higher profit margin). The same could be true of self driving cars -- we
believe it will let us make do with fewer cars, because they are easier to
share. Indeed, Google is perhaps the foremost example, incessantly cutting
away at the advertising sector (along with related industries), filling the
same purpose but better and an order of magnitude cheaper.

This is not growth, but degrowth. The thing is, it is still good and valuable
-- it's just that it's not reflected in GDP.

I would say that this has been going on for a few decades, which is why we've
seen the rise of the financial sector, which seems, to me, to be a kind of
"manufactured growth" -- all of our politics and policies expect, indeed,
_demands_ growth in order to work. So when it slows, or rather changes it's
nature if you will, we invent fake growth.

In summary, I agree with some of the "pessimists" in the article, but I'm
optimistic and hopeful about it. I think we can really live abundant.

~~~
brianchu
No, what you have just described is the epitome of _increased productivity_
and therefore increased GDP. In fact, productivity gains are the primary
contributor to rising standards of living (higher GDP per capita).

Take self-driving cars. Sure, one might fixate on the fact that car
manufacturers will lay off workers and that cab/truck drivers will lose their
jobs. But that's a very narrow way of viewing things. If self-driving cars
save 20 minutes in each American's day (commute, going out, filling up the
tank), we're looking at more than 11,900 human _years_ saved _each day_ , just
in the US. This figure doesn't even include the fact that when you are in the
car you can do work or read while the car is driving itself. And we haven't
even looked at: 1) health benefits from lower air pollution, 2) cheaper and
more efficient transport of goods everywhere (lower costs for every type of
good), 3) more efficient allocation of real-estate (no parking garages in the
middle of the city), and 4) numerous other effects I am probably leaving out.

~~~
yesbabyyes
You mention improvements such as lower air pollution. We don't measure that in
GDP today. That's kind of my point. If we internalize externalities, then all
of the effects I am talking about will also contribute to GDP.

But the way we measure GDP today, it looks like growth is slowing. Indeed,
some people, even in this community, feel we are working too many hours for
little reason. If we are to make truth of that, and work less with more
meaningful things, then that too would decrease GDP. But it would presumably
_increase_ well-being.

So what I propose is that we start measuring external costs, add them to the
price of goods (so the price better reflects the _real_ cost), and we won't
need to fill every space with advertising to keep up consumption.

If you want to read more about these ideas, and others perhaps more radical, I
can recommend this book of all my heart: <http://sacred-economics.com/>

_Edit:_ Perhaps the self driving cars were my weakest example. In my mind, the
most clear example is that of the free software movement. It's just a massive
gain for everybody, built collaboratively. And it took off just as Bill Gates
became the world's richest man off software. In a free software economy, that
kind of market capture is radically different.

~~~
brianchu
Again, things are not as clear as you try to paint them. Better health leads
to more productivity and higher GDP because instead of sitting in a hospital,
being miserable at home due to disability, or dying prematurely, you are
productive, working, and consuming.

Working less _does not necessarily_ drop GDP if it is offset by an increase in
productivity. If I work 8 hours with 1 unit of GDP/hour, that is the same as
working 4 hours with 2 units of GDP/hour.

Are you saying that free software lowers GDP? That connection is by no means
clear cut. Again, we can potentially see productivity gains in terms of lower
costs across the board.

I do not (and never did) disagree with you that GDP doesn't cover every metric
that ought to be measured (i.e. happiness). I'm correcting you because I think
your economic reasoning is flawed for most of your examples. And as it stands,
trying to measure "well-being" and quantify that value in terms of prices is
so utterly nebulous as a concept as to be nearly impractical. Who would set
and enforce the price? How would you even begin to convert happiness to money?

EDIT (reply to below):

First, there is no question that premature death will negatively impact GDP.
Furthermore, health problems that don't lead to a hospital stay but lead to
general disability will drag down productivity. Furthermore, while in the
short term a hospital stay in of itself (lets say, a $100,000 bill for lung
cancer) will increase GDP by the bill ($100,000), that money partly comes out
of savings that would be spent anyway in the long term. And the ability for
someone to create value as a productive worker/consumer is still severely
curtailed as a result. And while I'll concede that reducing hospital stays in
of itself has a negative effect to GDP, improvements in health end up being
net positive for GDP.

As for the larger philosophical question of GDP. Who is "we"? The economy will
optimize for itself (higher GDP) because that is how a market economy is set
up. And a market economy is not set up to optimize for anything other than
growth/money (money representing economic value). As for "people," people,
society, and governments routinely already optimize for other things.

~~~
yesbabyyes
_Again, things are not as clear as you try to paint them._

I might say the same thing to you. Your miserable person in a hospital might
actually count towards GDP, for instance. I'm sure you're familiar with the
broken window fallacy, and to me, it still seems to run wild.

Regarding your last paragraph, I think we are getting to the crux of the
problem. What is the purpose of optimizing for GDP if it can't encompass
what's important? It might not even be correlated. So I propose we change the
incentives and optimize for something else than "growth", as it were.

------
spikels
This seems to contradict the feeling of great progress in technology over the
last few years. Perhaps it is just an illusion that when "software is eating
the world" it is actually making the world better. Perhaps it is being negated
by lower productivity in the rest of the economy or government. Just seems at
odds with my recent experience.

------
nazgulnarsil
We're just spoiled. We want something as disruptive as the internet every
year.

~~~
eksith
This. And we want it as an app.

~~~
crgt
For free.

~~~
InclinedPlane
Available now.

~~~
ipedrazas
and that works offline

------
qxf2
Innovation is, and rightly should be, followed by a phase of enjoying its
benefits. We are enjoying the fruits of the Internet. Its opened up more
options and improved quality of life. My own life has changed drastically
since I was introduced to computers twelve years ago. Today I work across
continents - not a choice I had in the 90s. My mother can video chat with my
nephew and niece everyday. My grandmother can see places across the world in
vivid detail without leaving her chair. I can get away by being less
knowledgeable. The much reviled 140 characters is a symptom of us enjoying the
benefits.

What's the fascination with flying cars? Why is it a poster child of
'innovation'? Innovation is bursty, uncontrolled and usually cross
disciplinary. Innovation just happens. For true innovation, pay attention to
the Nobel prizes in science, to cutting edge research in science and not just
industry. Its also weird to put up known checkpoints like 'flying-cars' to
measure innovation.

Does anyone else find it strange that the title is 'idea machine' but content
is tangible innovation that reaches the masses?

From the article: >>"Mr Jones says that, from 1985 to 1997 alone, the typical
“age at first innovation” rose by about one year." Hmmm .... we are in 2013.
Why curate and quote a period from 1985 to 1997??

------
spiritplumber
Put the patent trolls to work the fields and the situation will surely
improve.

------
edderly
It's worth being careful with the provocative title. You should consider that
innovation can involve in recycling existing businesses, and the point here is
whether they are either generating growth or productivity.

So what this means is that there can be a whole load of innovation occurring,
but when it comes down to it, it may not be generating a lot of new growth.

------
graycat
I read it a little differently: 1920-1940, just 20 years, including 12 years
of The Great Depression, saw just explosive growth in telephones, electric
power, electric motors, electric lighting, radio, autos, oil, steamships,
chemical engineering, and airplanes with continued growth in railroads and,
thus, steel, Great Lakes shipping, and more. Then could go to college and
study 'industrial arts' with chemistry, strength of materials, metal working,
wood working, printing, etc. with excitement much like studying computer
science in college today. My explanation: Small gumment, meager regulation,
big bucks left over from the Gay 90s available for investment.

Then 1940-1970 the US DoD kept giving high technology many really big kicks in
the back side to move much faster each year. That's what built Silicon Valley,
much of Boston, several labs around the country, and many labs around DC.

But, the war in Viet Nam and the subsequent mess of the inflated economy,
e.g., the 22% prime rate and the S&L crisis, and the oil shock of 1973-4
slowed things down through at least 1980.

But in 1980, IBM retreated from their grand 'future systems' direction and did
another turn on the 370 architecture and started selling 370s again. They were
shipping from their plant in Kingston, NY. The 18 wheel trucks that came to
pick up the boxes got in a queue starting a the plant and continued out of
Kingston and onto the NY State Thruway and formed a queue there. There was a
blip in the GDP. So, things were starting to grow again.

By 1990, IBM was starting to hurt; microprocessors were taking a big toll on
IBM's revenue. In three years near 1994, IBM lost $16 billion and went from
407,000 employees down to 209,000 and cleared out rush hour traffic jams in
several counties north of NYC.

Since then we've had the dot-com bubble, 9/11, two wars of 10 years each, the
housing bubble and The Great Recession, the end of the Cold War, the end of
much of the Space Race, and, thus, no longer big Federal bucks for
'aerospace'. So, some things slowed down.

This should be a time of explosive growth, especially exploiting the
price/performance of current computing and optical fiber along with the
infrastructure software. To do what? Sure, to automate as much as possible of
everything there is to do -- computers managed by computers ... managed by
computers several levels deep managed by humans.

But there is a big financing problem: The big, old companies don't like to
innovate, are not being pushed by DoD and NASA, and don't see the big profits
that IBM long did. So, innovation is up to small companies. Alas, the way the
financing works, really there is essentially no funding for the research and
early development anything like what gave us everything from the electric
light bulb through the electric typewriter, the nuclear power reactors, the
Xerox machine, System 360, the SR-71, Multics, DEC VAX, AT&T Unix, and more.

So, now the IT R&D is from 1-3 guys funded by personal checkbooks. The
'professional' money doesn't want to get involved until all the R&D is done,
the product has launched, and there is significant 'traction' growing rapidly.
That's a long way from, as I recall, Rockefeller writing checks to get Edison
and/or GE going so that we could have electric lighting instead of gas
lighting. And if Rockefeller asked Edison how the bulb was going, Edison could
only say that he knew 1000 things that wouldn't work.

And the ability to raise money on the stock market is much less good: 100
years or so ago, could form a company on Monday, print stock on Tuesday, sell
it to the public on Wednesday, and then by Friday be building the new
steamship, railroad, hotel, coal mine, or whatever.

Currently Apple, Google, Cisco, Microsoft and more are sitting big piles of
cash and _should_ be able to fund a next big thing like Rockefeller funded
electric lighting.

------
magicarp
No

~~~
redschell
[https://en.wikipedia.org/wiki/Betteridge%27s_law_of_headline...](https://en.wikipedia.org/wiki/Betteridge%27s_law_of_headlines)

------
influx
Everything's Amazing and Nobody's Happy:

<http://vimeo.com/50652818>

------
diminish
The Economist, is the maintainer of the current world order, reassures us
again and again then all is fine, or getting better.

