Technological transformation
Technological transformation

It’s no secret to anyone who has read much of this site that the author has been profoundly pessimistic about the ability of the West to avoid a depression, possibly the Greatest Depression. But finally we have reason to hope. It’s a long shot, but worth outlining.

Before charging ahead, let’s remind ourselves of a central aspect of the problems faced by the West. In a nut shell, too  much has been promised to too many. Society will not be able to deliver. You know the sort of stuff:

  • Retire thirty years before you will probably die
  • Don’t enter the workforce for the first twenty something years of your life.
  • Free health care
  • Generous public service pensions
  • Small numbers of students in classrooms
  • Repay government debt and take on debt of the politically connected vested interests
  • Government housing, income support, child allowances…etc.

Absent something miraculous on the productivity front there are not going to be enough workers per dependent person. Top and tailing peoples working life, while not having as many new workers entering the workforce as those retiring is not a sensible societal option. Having large numbers of unemployed people will exasperate the problem.  Sorry to disappoint those getting all worked up in the US, but sacking a few public servants and selling some assets to the politically connected at below market rates will not fix things. Neither will pandering to government employees and union heavies. You have been consuming more than you produced, hence the growth in debt without associated growth in production. Repaying the debt or even stopping the growth of debt will require a reduction in consumption. In real terms your GDP will fall. It will shrink down to a level from which healthy growth can occur. In fact it will probably overshoot this level. Prepare for a significant fall in your living standards as it is almost inevitable.

Sure people have made decisions and lived their life in part based on the false promises of politicians of all political persuasions. They will be unhappy when they discover the reality of their situation.  They will look for someone to blame. People will try and focus this anger on targets that suit them. There could be social strife across the West such as has not been seen since 1848. But I digress. This is a post of hope. What could change this pessimistic prognosis?

The most obvious answer is something miraculous on the productivity front. Well we have seen signs of that with Additive Layer Manufacturing and 3D printing type technology reaching the tipping point where it may start being rolled out en mass. If you are not aware of the potential for 3D printing have a look at:

More links on 3D printing here.

The technology has the potential to transform much of the manufacturing, retail and distribution sectors of the economy. The technology is developing rapidly and will no doubt be another example of technology experiencing exponential rates of improvement.  Moore’s law does seem broadly applicable as Ray Kurzweil has demonstrated. I recommend watching the Transcendent man which can be downloaded here for US$14.99.

The Transcendent man raises the specter of artificial intelligence. It too will no doubt come into being. But perhaps not as soon as Mr Kurzweil predicts. Until then 3D printing and other power related technological improvements may provide the productivity increases necessary for denizens of the West to live in the style to which they have become accustomed. There are grounds for hope.

These types of advances are some of the reasons why life will get better manifesting themselves.

.



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