Articles

Jan. 1, 2005

Morality and Innovation

Innovation drives each Long Wave. As waves of innovation sweep over society, funded first by surplus and later growing on their own momentum, society transforms. The rails of the 1840s allowed the masses to travel great distances. The automobile upset the moral foundation of the Victorian era leading to flappers and speakeasies. The mass education and communications boom of the 1960s led to the "generation gap" and hippies becoming affluent yuppies.

The culture shock of each wave and the resulting social displacement is difficult if not impossible to anticipate. The Victorian parents of the flappers were as shocked by behavior as were the WW II parents of the Vietnam era protestors. Innovation so greatly changes wealth and society as to spawn a new language and new sets of moral values.

In the face of the unknown, myths and agreement guide the rules of society. When Copernicus published his book "Little Commentary" using science to prove the earth was not the center of the universe he was condemned as a heretic. Over time truth and science replaced myth and religion. As with every major innovation or scientific discovery, society requires time to absorb and recalculate a new moral course.

Innovation

For some time I have been probing and imagining what a new world of globalization and technology will look like. As the manufacturing model spreads over the world producing social change and conflict in its wake, the core of society is also changing. Globalization is probably enough to equal of the growth of past Long Waves. However, something more fundamental is at work. If we are to understand and profit from the future we must look to the core and not be distracted by the expansion of past trends - globalization.

The greatest profits in the life cycle of an industry are in the first wave. As an industry matures, profits narrow. While globalization will bring great wealth to many nations, the differential will be far less than from new technology. A perfect example is the effect on OPEC oil ministers' relative wealth during the "energy crisis" compared to the rapid and almost unlimited riches of software giants like Bill Gates, Larry Ellison and Steve Jobs.

As the next wave of innovation unfolds, it will eclipse in size, impact and wealth creation all past booms. Further, there is a progression in innovation

Where rails and autos deal with mobility putting diverse cultures face to face, transistors opened for the first time the workings of the mind. Computers are tools that instead of aiding physical labor take over and add to mental capacity. However, computers challenge few rules of society in comparison to the next boom.

Genomic Revolution

Shockley inventing the transistor - a small device - upset the futurists and opened a new world of microelectronics. While GM grew through the 1950-60s becoming the first company to earn more than a billion dollars, the growth of the autos ended in the mid 1960s. The peak of the American auto industry was really in 1957-58. The growth of computers surpassed the auto industry pushing IBM to the forefront of the "nifty fifty" which was dominated by computer stocks.

It is typical to see the start of a Long Wave growth period dominated by past technology. Somewhere, midway in the cycle focus shifts and new technology leads the way. Invented in 1949 start of the previous growth period the transistor took another 15 years to dominate. The same pattern should emerge with the next period of growth as genetics and microbiology emerge to dominate society and GDP.

Missed is the challenge of genetics to society's moral code. The US Federal ban on stem cell research and funding is only the tip of the social and moral iceberg. Where previous innovations challenged workers' roles, created a leisure industry and middle class and even spawned the feminist movement, genetics opens up access to creation. Genetics becomes the last wall to fall.

Through genetic manipulation science begins to challenge the nature of creation, the definition of life and the concept of the soul. Like Copernicus with his model of the universe, genetics upsets long held myths and beliefs. The revival of religious influence worldwide at the base of each Long Wave is a reaction to displacements of the past - an attempt at making sense out of global changes. As innovation begins to move rapidly ahead, the values of the old religions are left behind as the next generation embraces the new technology. The drum beat of profits and the new possibilities of life form a mantra of the new era - one founded on new concepts of life and human rights. Today our world stands at the threshold of reformation and religious revolution.