Where Are the Jobs?

By , The New York Times, October 6, 2011

Let’s imagine that someone from the year 1970 miraculously traveled forward in time to today. You could show her one of the iPhones that Steve Jobs helped create, and she’d be thunderstruck. People back then imagined wireless communication (Dick Tracy, Star Trek), but they never imagined you could funnel an entire world’s worth of information through a pocket-sized device.

The time traveler would be vibrating with excitement. She’d want to know what other technological marvels had been invented in the past 41 years. She’d ask about space colonies on Mars, flying cars, superfast nuclear-powered airplanes, artificial organs. She’d want to know how doctors ended up curing cancer and senility.

You’d have to bring her down gently. We don’t have any of those things. Airplanes are pretty much the same now as they were then; so are cars, energy sources, appliances, houses and neighborhoods. A person born in 1900 began with horse-drawn buggies and died with men walking on the Moon, but the last few decades have seen nothing like that sort of technological advance.

Recently, a number of writers have grappled with this innovation slowdown. Michael Mandel wrote a BusinessWeek piece in 2009.Tyler Cowen wrote an influential book called “The Great Stagnation” in 2010. The science-Fiction writer Neal Stephenson has just published a piece called “Innovation Starvation” in World Policy Journal and Peter Thiel, who helped create PayPal and finance Facebook, had an essay called “The End of the Future” in National Review.

These writers concede that there has been incredible innovation in information technology. Robotics also seems to be humming along nicely, judging by how few workers are needed by manufacturing plants now. But the pace of change is slowing down in many other sectors.

As Thiel points out, we travel at the same speeds as we did a half-century ago, whether on the ground or in the air. We rely on the same basic energy sources. Warren Buffett made a $44 billion investment in 2009. It was in a railroad that carries coal.

The Green Revolution improved grain yields by 126 percent from 1950 to 1980, but yields have risen only by 47 percent in the decades since. The big pharmaceutical companies have very few blockbuster drugs in the pipeline. They are slashing their research departments.

If you buy the innovation stagnation thesis, three explanations seem most compelling. First, the double hump nature of the learning curve. When researchers are climbing the first hillside of any problem, they think they can see the top. But once they get there, they realize things are more complicated than they thought. They have to return to fundamentals and climb an even steeper hill ahead.

We have hit the trough phase in all sorts of problems — genetics, energy, research into cancer and Alzheimer’s. Breakthroughs will come, just not as soon as we thought.

Second, there has been a loss of utopian élan. If you go back and think about America’s big World’s Fairs or if you read about Bell Labs in its heyday or Silicon Valley in the 1980s or 1990s, you see people in the grip of utopian visions. They imagine absurdly perfect worlds. They feel as though they have the power to begin the world anew. These were delusions, but inspiring delusions.

This utopianism is almost nowhere to be found today. Stephenson and Thiel point out that science fiction is moribund; the new work is dystopian, not inspiring. Thiel argues that the environmentalist ethos has undermined the faith in gee-whiz technological wizardry. Legal institutions and the cable TV culture dampen enthusiasm by punishing failure so remorselessly. NASA’s early failures were seen as steps along the way to a glorious future. Deepwater Horizon’s failure demoralized the whole nation.

Third, there is no essential culture clash. Look at the Steve Jobs obituaries. Over the course of his life, he combined three asynchronous idea spaces — the counterculture of the 1960s, the culture of early computer geeks and the culture of corporate America. There was LSD, “The Whole Earth Catalogue” and spiritual exploration in India. There were also nerdy hours devoted to trying to build a box to make free phone calls.

The merger of these three idea networks set off a cascade of innovations, producing not only new products and management styles but also a new ideal personality — the corporate honcho in jeans and the long-sleeve black T-shirt. Formerly marginal people came together, competed fiercely and tried to resolve their own uncomfortable relationships with society.

The roots of great innovation are never just in the technology itself. They are always in the wider historical context. They require new ways of seeing. As Einstein put it, “The significant problems we face cannot be solved at the same level of thinking we were at when we created them.”

If you want to be the next Steve Jobs and end the innovation stagnation, maybe you should start in hip-hop.


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