May 10, 2012

Abundance by Peter H. Diamandis & Steven Kotler

Abundance by Peter H. Diamandis & Steven Kotler
The future is better than you think.
(narrates unexplored territories that can meet growing population needs)

Gaius Plinius later volumes, Earth, book XXXV, Pliny tells the story of a goldsmith who brought an unusual dinner plate to the court of Emperor Tiberius in AD 23. The plate was a stunner, made from a new metal, very light, shiny, almost as bright as silver. The goldsmith claimed he’d extracted it from clay using a secret technique. Emperor was also a financial expert who knew the value of his treasure would seriously decline, if people suddenly had access to shiny new metal. Therefore, recounts Pliny:, “instead of giving the goldsmith the reward expected, he ordered him to be beheaded”. The shiny new metal was aluminum and that beheading marked its loss to the world for nearly 2 millennia (it reappeared in Ad 1800).

The amygdala is an almond-shaped silver of the temporal lobe responsible for primal emotions like rage, hate and fear. It’s our early warning system, an organ always on high alert, whose job is to find anything in our environment that could threaten survival. These days we are saturated with information and how do media compete to get our mind share? By vying for the amygdala’s attention. The old newspaper saw “if it bleeds, it leads’ works because the first stop that all incoming information encounters is an organ already primed to look for danger. We’re feeding a fiend. If you check your newspaper, you will find that over 90% of the articles are pessimistic. Quite simply, good news does not catch our attention. Bad news sells because the amygdala is always looking for something to fear.

Even under mundane circumstances, attention is a limited resource. Of course, any fear response only amplifies the effect. In short, once amygdala begins hunting bad news, it’s mostly going to find bad news. First, it is hard to be optimistic because the brain’s filtering architecture is pessimistic by design. Second, good news is drowned out because it’s in the media’s best interest to overemphasize the bad. Third, it’s not just that these survival instincts make us believe that ‘the hole we’re in is too deep to climb out of’ but they also limit our desire to climb out of that hole.

Over the past 150,000 years, Homo sapiens evolved in a world that was ‘local & linear’, but today’s environment is ‘global and exponential’. If you make 30 linear steps, you end up 30 feet away, but if you take 30 exponential steps, you will end up a billion meters away.

Robin Dunbar was interested in the number of active interpersonal relationship that the human brain could process at one time. After examining global and historical trends, he found that people tend to self-organize in groups of 150 and this explains why the US military consider 150 as the optimal size for a functional fighting unit. Gossip, in its earlier forms, contained information that was critical to survival because, in clans of 150, what happened to anyone had a direct impact on everyone. In the nuclear family, very few of us actually maintain 150 relationships. But we still have this primitive pattern imprinted on our brain, so we will those open slots with whomever we have the most daily ‘contact’ - even if that contact comes only from watching that person on television. Our brain does not realize there’s difference between TV personal (virtual) we know about and relatives we know.

In the past, we spend most of the time on travel and other things - non-productive purposes. Now with new technology, we can save more time which we can spend for worthwhile cause. So the best definition of prosperity is simply ‘saved time’. As Ridley feels that the true measure of something’s worth is the hours it takes to acquire it”. ‘In a world of material goods and material exchange, trade is a zero-sum game’ says inventor Dean Kamen. “I’ve got a hunk of gold and you have a watch. If we trade, then I have a watch and you have a hunk of gold. But if you have an idea an dI have an idea, and we exchange them, then we both have two ideas. It’s nonzero”.

Ray Kurzweil in his first book, 1988’s ‘the age of intelligent machines’, he used exponential growth charts to make a handful of predictions about the future. His predictions turned out to be uncannily accurate: foretelling the demise of soviet Union, computer winning chess championship, and www. In his follow-up 1999 book ‘ When computers exceed human intelligence, Kurzweil extended this prophetic blueprint to the years 2009, 2019, 2029 and 2099. Out of 108 predictions made for 2009, 89 have come true outright and another 13 were damn close, giving Kurzweil a soothsaying record unmatched in the history of futurism.

The two most powerful cooperative tools the world have ever seen are transportation revolution and ICT (information and communication technology). Jeffery Sachs counts eight distinct contributions ICT has made to sustainable development - all of them cooperative in nature.

The first of those gains is connectivity. The second contribution is an increased division of labor, as greater connectivity produces greater specialization, which allows all of us to participate in the global supply chain. Third comes, scale, wherein messages go out over vast networks, reaching millions of people in almost no time at all. The fourth is replication: “ICT permits standard process, for example, online training our production specifications to reach distant outlets instantaneously. Fifth is accountability: today’s new platforms permit increased audits, monitoring and evaluation, a development that has led to everything from better democracy to online banking to telemedicine. The sixth is the internet’s ability to bring together buyers & sellers is the enabling factor behind ‘long-tail’ economics. Seventh is the use of social networking to build communities of interest. The eighth spot is education and training as ICT taken the classroom global while simultaneously updating the curriculum to just about every single bit of information one could ever desire.

The three technologies have world-feeding potential. While aquaculture is here today, the GE industry is dominated by three seeds (cotton, corn, and soybean) and has yet to penetrate deep into the food crop market. Golden rice (rice fortified with vitamin A) is about to clear regulatory hurdles and enters the food chain. Cultured meat is probably 10 to 15 years out, and the same appears true for widespread deployment of vertical farms.

Our current education system was forged in the heat of industrial revolution, a fact that not only influenced what subjects were taught but also how there were taught. Schools were organized like factories: the day broken into evenly marked periods, bells signaling the beginning and the end of each period and even teaching was subject to division of labor - like any assembly line, students progressed from room to room to be taught by different teachers specializing in separate disciplines. What we do know is that the industrialized model of education, with its emphasis on the rote memorization of facts, is no longer  necessary.Facts are what Google does best. But creativity, collaboration, critical thinking and problem solving - that is a different story. These skills have been repeatedly stressed by everyone from corporate executive to education experts as the fundamental required by today’s jobs. They have become the new version of the three Rs (reading, writing and arithmetic); the basics of what recently been dubbed ‘twenty-first-century learning’. Educational pundits stressed the ability to ask right questions. “There is something about understanding what the right questions are; and there is something about asking the nonlinear, counterintuitive questions. These are the ones that take you to the next level”.

Studies have shown that games outperform textbooks in helping students learn facts-based subjects such as geography, history, physics and anatomy while also improving visual coordination, cognitive speed, and manual dexterity. World-building games like SimCity and Rollercoaster Tycoon develop planning skills and strategic thinking.

There are four major motivations that drive innovations. The first, and weakest of the bunch, is curiosity: the desire to find out why, to open the black box, to see around the next bend. It fuels much of science, but it’s nothing compared to fear, our next motivator. Extraordinary fear enables extraordinary risk-taking. The desire to create wealth is the next major motivator. The fourth and final motivator is the desire for significance: the need for one’s life to matter, the need to make a difference in the world. One tool that harness all four of these motivations is called the incentive prize. If you need to accelerate change in specific areas, esp. when the goals are clear and measurable, incentive competitions have a biological advantage. Humans are wired to compete and we are wired to hit in the world, no matter where they live or where they are employed, to work on your particular problem.

Almost every time I give a talk, I like to ask people what they fear most about failure. There are three consistent answers: loss of reputation, loss of money and loss of time.

In our abundant future, the dollar goes further. As does yen, peso, euro, and so forth. This happens because of dematerialization and demonetization; because of exponential price-performance curves; because each step up prosperity's ladder saves time; because those extra hours add up to additional gains; because the close ties between categories in our abundance pyramid produce positive feedback loops, bootstrapping potential and the domino effect and for a thousand other reasons.  

Proverbs 29;:8 tells us: “Where there is no vision, the people will perish”. Abundance is both a plan and a perspective. Where is a vision, the people flourish. The impossible becomes the possible and abundance for all becomes imagine what’s next.

Books referred in this book:
Where Good ideas come from: the natural history of innovation by Steven Johnson.
Out of our minds: Learning to be creative by Sir Ken Robinson

May 6, 2012

No One’s world by Charles A. Kupchan

No One’s world by Charles A. Kupchan
The west, the rising rest, and the coming global turn
(Talks about changing landscape of global power team. What I find it interesting is the depth of historical information provided (many of them are new to me and hence very enlightening)
The west is losing not only its material primacy as new power rise, but also its ideological dominance. The rising rest (BRIC) regularly break with US and Europe on geopolitics, trade, the environment, and other issues, preferring to side with ascending states, whether democratic or not. Interests matter more than values. The liberal democracies of the West have been stumbling. The US is not alone in confronting democracy’s discontents. Many industrialized countries - UK, France, Germany, Italy and Japan among them - have recently been afflicted by divided electorates and enfeebled government.
The emerging landscape is one in which power is diffusing and politics diversifying, not one in which all countries are converging toward the Western way. Between 1500 & 1800, the world’s center of power moved from Asia and the Mediterranean Basin to Europe and by the end of nineteenth century, North America. The West then used its power at the leading edge of history ever since. But the West’s rise was a function of time and place, and history is now moving on. East Asia has been anointed as the candidate most likely to assume the mantle of leadership. It is doubtful, however that any country, region or model will dominate the next world. For the first time in history, an interdependent world will be without a center of gravity or global guardian. A global order, if it emerges, will be an amalgam of diverse political cultures and competing conceptions of domestic and international order. Failure to foresee this global turn and adjust the West’s grand strategy accordingly would be an error of grave consequence.
West’s ascent to global preeminence between 1500 & 1800, shows that the West followed a unique and contingent path that was, paradoxically, a product of its singular political weakness. The main driver of Europe’s rise was socioeconomic ferment. In the midst of the fragmenting political order of medieval Europe, a nascent middle class of merchants, entrepreneurs and intellectuals challenged the power of monarchy, aristocracy and church. This rising bourgeoisie went on to serve as the vanguard of the Protestant Reformation., which fostered religious tolerance and set the stage for the eventual separation of church and state. Combined with the emancipatory ideas of the Reformation, the growing costs of the modern state forced monarchs to share power with their subjects in order to gain access to their resources and skills. The rising middle class also provided the economic and intellectual market capitalism and gave birth to secular nationalism via urbanization, public education, mass conscription and other social developments that were a by-product of industrialization. Nationalism became the twin sister of democratization, providing the connective tissue would hold together societies by consent rather than coercion.
More rigid and hierarchical orders in the ottoman Empire, India, China and Japan stood in the way o f the transformation that fueled the rise of Europe and North America, enabling the West to become the globe’s center of gravity in the nineteenth century. The global spread of the West’s founding ideas marked the first time that a single conception of order took hold in most quarters of the world. And the long and expansive run of this order admittedly provides ample reason for confidence that the Western way is here to stay. The spread of this order has in large part been a product of the West’s material dominance, not the universal appeal of its ideas.
Rising rest is not tracking the development path followed by the West. They have different culture and socioeconomic foundations, which give rise to their own domestic orders and ideological orientations. They have different views about the foundations of political legitimacy, the nature of sovereignty, the rules of international trade, and the relationship between the state and society. The developmental paths followed by the rising rest represent alternatives to the Western way, not temporary detours on the road to global homogeneity.
During the West’s rise, the middle class was the main agent of change. Today, China’s middle class is a defender of status quo, not a force of political change. Today, the international system is interdependent and porous; more centralized states are in many respects better able to cope with globalization than more pluralistic ones. In today’s multifaceted global system, different types of states have their advantages and disadvantages. It is for this reason that the 21st century will host multiple brands of modernity, not political homogeneity along Western lines.
For two reasons, cannot presume that the coming global turn will coincide with the universalization of the Western order. First, is the timing problem. It takes long time to transform non-democratic regimes into democratic ones. Britain became a constitutional monarchy when it began late in the 17th century, but did not mature into a liberal democracy for another 200 years. Germany began life as a unified state in 1871, but it took some eight decades and two world wars for democracy to take root. Second, is democratization does not mean Westernization. Indeed democratization could well produce states decidedly opposed to adhering to the international order erected by the West. In the Middle East, for example, more democracy may well mean more political Islam and the emergence of Arab states which will be less willing to cooperate with the West than their autocratic predecessors.
Rise of West.
For some 100 years - from 5th to 15th- power shifted to the East as Rome lost its pride of place to Constantinople, the center of Byzantine Empire. Two empires accounted for half of global wealth. Although the Holy Roman Empire existed in name from 962 until the early 19th century, imperial rule was fragmented from the start, with authority widely distributed among the king, the pope, local religious leaders, noble families and relatively autonomous fiefdoms. . The power struggle among them opened up political space for new actors (merchants, artisans and other members of middle class who founded independent towns in order to play their trades and accumulate wealth beyond the reach of manorial and ecclaesitical authority.
Three developments during the early phases of the Holy Roman Empire (962-1806) set the stage for Europe’s rise. First, the collapse of the Carolingian Empire in 888 cleared the way for the onset of feudalism and the more fragmented political landscape that accompanied the spread of autonomous manors. Second, competition between the emperor and pope and divisions within the church itself weakened both imperial and ecclesiastical authority. Third, the growth of trade led to the rise of a nascent bourgeoisie that established new towns and capitalized on the diminished strength of state and church to expand its own influence.
After the collapse of the Carolingians, cavalry effectively became knights as they putdown territorial roots and fashioned lord-vassal relationship with local nobility. Land which had been the exclusive provenance of the monarch, passed into the hands of the nobility; possession became ownership and ownership became hereditary. Knights offered protection to the now-landed nobility, in return receiving rights to a fief and the agricultural revenue it produced. Power struggle between emperor and pope further contributed to the political fragmentation of Europe. Strife within the church itself also contributed to the erosion of ecclesiastical authority. In 1054, the Christian world broke into its Roman Catholic and Greek Orthodox variants (In the 4th century, Roman Empire was divided into administrative halves; Western empire was governed from Rome and Easter empire from Constantinople. Soon thereafter, the papacy in Rome and patriarchate in Constantinople began to jostle over doctrinal questions and status).
Towns became centers of not only wealth, but also learning, printing and innovation. The accumulation of wealth enabled some urban dwellers to focus on intellectual pursuits rather than manual labor. Innovation was driven in larger part by practical demands of commerce. In the country side, time was marked by nature - seasons, festivals, light and dark - and trade was based on personal relationships. Over the time, the expansion of literacy and learning led to progress not only on matters of business. Towns opened up unprecedented opportunities for scholarship, contributing to the humanist movement and advancing study of the arts, literature, law and medicine.
The protestant movement and its clash with Catholicism had three irreversible effects of fundamental importance. First, the Reformations set the stage for the intellectual advances of the Enlightenments by exposing religion and ultimately politics to theological, moral and rationalist inquiry. Second, Protestants proved to be a new source of common cause - Protestants communities formed strategic alliances within and across territorial boundaries to enhance their ability to challenge status-quo. Third, decades of religious war produced both religious tolerance and political pluralism: tolerance was born out of conflict.
The spread of the protestant reformation generally tracked the socioeconomic divide between town and countryside. The north and west of Europe - Germany, Netherland, Scandinavia and England- which were the most commercialized and urbanized regions, embraced Protestantism in one of it various form. The south and east - Eastern Europe, Italy, France & Spain- which had, with the exception of Italy, more agrarian economies and rural populations, tended to remain Orthodox or Catholic.
Ottoman Empire:
Ottoman rulers maintained centralized control throughout the imperial realm, prohibiting the emergence of the autonomous sites of wealth and power that were the agents of change in Europe. The sultan and his administrators rigidly enforced vertical lines of authority, denying artisans, merchants, traders, and intellectuals the ability to amass the influence and build horizontal ties needed to serve as a counterweight to the imperial apparatus. Such centralized control also partway in explaining why the ottoman realm did not experience an Islamic Reformation that could have transformed its religion and political landscape as the Protestant Reformation did for Europe.
Christianity is a religion of faith, not law and politics. Its central focus on faith is one of the main reasons that doctrinal dissent, once established led to the proliferation of competing denominations. It is also one of the main reasons that the pope consistently sought alliances with secular rulers. The church had a paramount interest not only in mediating between secular & sacred, but also in amassing the land & wealth that would augment its political power. Meanwhile the rising bourgeoisie challenged traditional institutions of authority by consistently playing emperor against pope and state against church. In Contrast, Islam is a religion faith and law in which there is no distinction between sacred & secular. The Ottoman sultan was emperor and pope, and the state was the mosque and the mosque the state. This altogether different relationship between religion and politics helps explain why merchants, artisans and other urban elites with an interest in more autonomy were unable to find the gaps in authority needed to get a firm foothold.
The sultan wielded absolute power over imperial administration. Istanbul undercut the potential challenge posed by aristocratic families in Anatolia by expropriating land and converting it to state-owned property. Land and wealth could no longer be passed from one generation to the next. Istanbul’s tight hold on power also extended to matters of commerce. The prices of goods and the flow of trade were controlled by imperial officials, in no small part to ensure that the government could secure commodities at reasonable cost. Merchants therefore unable to accumulate substantial wealth, denying them the ability to emerge as a check against state power as their counterpart did it in Europe. The centralized authority in Istanbul and socioeconomic stasis that followed would ultimately deny the ottoman realm the society vitality, economic vigor, and political and religious pluralism needed to keep pace with Europe. The Ottoman Empire finally collapsed in the early century not because center failed, rather the center unable to continue exercising centripetal force over the hub-spoke system it had long before erected. As Barky concludes, “What was left finally was a galaxy of nationalism increasingly floating free from one another”. Strength of their state became their weakness.
In China the chief obstacle of growth was the state with its close-knit bureaucracy which lay across the top of Chinese society as a single, virtually unbreachable stratum.  Villagers were generally left alone to pursue their livelihood and did not face the intrusive control over production and trade exercised with the Ottoman realm. Taxation remained relatively low and the state did not cage its population as it did in Europe. Because of lack of demand for capital, as well as the tight grip of the central government, China did not develop the banking system and more advanced debt instruments that contributed to the accumulation of wealth in Europe. China lacked wealthy middleclass that was capable of pushing back against the power of imperial institutions.
Muslims armies, primarily of Turkic background began invading India during the early eight century. Before these invasions, India passed through several centuries of weak and fragmented government. As during previous periods in Indian history, the absence of centralized control contributed to intellectual and economic vitality/. Muslim invaders brought this period of fragmentation to an end. The Delhi Sultanate which was established in 12-6 lasted over 300 years, relied on a highly centralized brand of rule. The court set prices for goods and required that all merchants be licensed. Agricultural taxes stood at one-half of output, preventing the accumulation of substantial wealth outside imperial institutions. Mughals, a Muslim group originally from Central Asia were the next to conquer India. India had the resources and human capital needed to emerge as a leading world power. But the rigid political and social hierarchy imposed by imperial rulers ultimately impaired its ability to keep pace with Europe as the modern era unfolded.
The rise of the rest.
In 2010, out of the top five economies in the world were parts of West. In 2050, according to Goldman Sachs, the US will be the only western power to make it into the list (2050 - China, US, India, Brazil & Russia). The collective GDP of the four leading developing countries (BRIC) is likely to match that of today’s leading western nations by 2032. World Bank predicts that US dollar will lose its global dominance by 2025 as the dollar, euro and China currency become co-equals in a ‘multi-currency’ monetary system. West’s population represents less than twenty percent of the globe’s total.
US is poised to remain the world’s premier military power for decades, but its ability to exercise superiority in disparity regional theaters will diminish as emerging powers continue to expand their fleets. And although with a considerable time lag, a more level playing field economically will ultimately translate into a world in which military power is more equally distributed. US thus appear to be following the footsteps of UK, the last global hegemony.
Three main arguments as to why rising states rather than talking the western way will follow their own developmental paths and embrace their own views about domestic governance and how best to organize the international system of the 21 century.
1. Emerging countries such as China, India and Brazil are experiencing the rise of a middle class that will to some extent play the same role that the bourgeoisie did in Europe between 1500 & 1800. But today’s rising powers are each following unique paths towards modernity based on their own political, demographic, topographic and socioeconomic conditions.
2. Cultures matters; it shapes the particular forms of modernity that evolve in different regions. In China & Russia and other capitalist autocracies, communitarian and paternalistic cultures sharply contras with the liberal traditions that are a hallmark of the West.
3. Today’s emerging power are moving up the pecking order is a very different international setting than the one that hosted the West’s rise.
Three main variants of autocracy are exhibiting considerable staying power. 

Communal autocracy entails a mutually reinforcing partnership between private sector and the state apparatus. Middle class gets what it wants - wealth- while the ruling party gets what it wants - the retention of power (China is a perfect example). 

Paternal autocracy entails a more hierarchical relationship between state and the bourgeoisie; bureaucrats and other public employees make up much of middle class, leaving the private sector and civil society small, weak and under the intimidating eye of state authorities. The broader citizenry sees the state as a caretaker of citizen, expecting economic and social benefits in return for political obedience (Russia is a perfect example). 

Tribal autocracy entails the incorporation of the middle class into a political community defined more by tribe and clan than by the state. Political order is a function mainly of tribal patronage. The sheikdoms of the Persian gulf as prime examples.
China has plenty of weakness. Absence of civil liberties, the violation of human rights, and repression of dissent are glaring black marks. Lack of political pluralism is not only a moral consequence, but also inhibits the country’s performance. China lacks the mix of venture capital and technological prowess that drives innovation in US. Rural peasants still make up between 50-60% of its population.
The rise of the West was in many respects the product of the readiness of Europeans to countenance change and welcome a religious and political diversity that overturned the economic political and ideological status quo. The reformation the rise f the middle class, the challenge these developments posed to monarchy, aristocracy and church -these were the defining developments that provided the West toward a remarkable era of progress and prosperity.
Today, such profound change is happening again, except is occurring on a global scale. New players and diverging ideologies are challenging the Western order and the traditional institutions of authority on which it resists. If the West can help deliver to the rest of the world what it brought to its several centuries ago - political and ideological tolerance coupled with economic dynamism - then the global turn will mark not a dark era of ideological contentions and geopolitical rivalry, but one in which diversity and pluralism lay the foundation for an era of global comity.