View Full Version : No more industrial revolutions, no more growth?

12-27-2012, 05:45 PM

The common feature of the transformative technologies of the 20th and 21st centuries is that they were one-offs that cannot be duplicated.What if the engines of global growth that worked for 65 years (since 1945) have not just stalled but broken down? The primary "engines" have been productivity gains from industrialization, real estate development and expansion of consumption based on the continual expansion of debt and leverage--in short-hand, financialization.

The Status Quo around the globe has responded to the obvious endgame of financialization (the 2008 financial crisis) by doing more of what has failed: expanding credit and leverage, flooding the global economy with liquidity (money available for borrowing), credits and subsidies for real estate development and a near-religious belief in "the next industrial revolution" that will spark rapid growth in employment, profits and productivity.

"The usual suspects" for the next engine of growth include nanotechnology, biotechnology, unconventional energy and Digital Fabrication, i.e. 3-D printing and desktop foundries. But are any of these capable of not just replacing jobs and revenues in existing industries, but creating more jobs and expanding revenues and profits?

12-27-2012, 07:24 PM
Part of the problem, I think, is we tend to hold onto the old technologies for dear life when we need to embrace new technologies. Consider the recent discussion the pretty much rejected newfangled computers and cellphones. Information technology, communications is the future. Those usual suspects are becoming more and more democratic in the sense of being at anyone's fingertips to use, cheaply, to start up a small business and create jobs. An example is 3-D printing. Here's an interview with Chris Anderson, author of Makers: The New Industrial Revolution, who started up his own business building drones (non-military):

the story of how technology is transforming the manufacturing business. Anderson argues that the plummeting prices of 3D printers and other tabletop design and manufacturing tools allows for individuals to enter manufacturing and for manufacturing to become customized in a way that was unimaginable until recently. Anderson explores how social networking interacts with this technology to create a new world of crowd-sourced design and production.

@ Chris Anderson on Makers and Manufacturing (http://www.econtalk.org/archives/2012/12/chris_anderson_2.html)

It's only bleak for carriage makers.

Captain Obvious
12-27-2012, 08:09 PM
There was an interesting clip that I heard on the radio, I can't find it right now but the point that was made was that manufacturing to a degree was improving domestically, re-insourcing, because the Chinese were basically using our technology to knock-off our products and reproduce them.

The point was that China has the labor, they have the resources but they don't have the technology yet to develop their own products.

12-31-2012, 08:03 AM
Unfortunately, not so, Chris:



12-31-2012, 09:26 AM
We also know that manufacturing is down around the world as we move to other areas like service, information, etc. Sure robots can build 80% of a car, but someone's got to build the robots. As an essay like "I, Pencil" shows, there's a whole army of people behind making things, but obtaining the resources, transporting, and marketing.

In short, one narrow measure skews the bigger picture. It's something you might bet a market investment on, but not the future of an economy.