Accelerating to Real Prosperity: How to Solve National and Global Problems Through More Progress

[Vinay Gupta]

From the archives: http://mindismoving.org/blog/?p=852 2006-06-30 21:51:09

(yep, that's fully three years ago.)

Apparently this is one of those thinking and writing days.

Here's what's on my mind: the American National Debt is $60,000 per tax payer. Most Americans have less than zero assets: sell everything they own, liquidate all assets, and they can't pay their own debts. Add to this the exposure of over $400,000 per household from Medicade and it's fairly obvious that America is just plain bankrupt. The Federal Government is relying on the individual citizens to pay for this stuff. There are no two ways about this: it gets paid for through taxation.

Now let's talk Global Warming. I haven't seen Gore's movie but we all know the score: we're pumping out CO2 like there is no tomorrow, Kyoto ain't nearly enough and it's failing anyway and, bottom line, we don't have the political will to fix this problem even if we do have the scientific capability. Grand plans involving energy efficiency refits of entire nations, carbon taxes and so on are really all waiting for the Environmental Pearl Harbor.

Unfortunately we haven't had it yet, and by the time we do it may be too late to avoid the worst of the trouble.

So where does this leave us as a civilization, as a culture, and (most importantly) as individuals?

Well, let's start with the stock market. Go take a look at the price / earnings ratios of the US economy.

So we have an economic timebomb, a government that has chewed elephant-sized ratholes in every fundamental civil right there is as well as instituting huge electronic domestic spying programs. Nobody who's ready history looks at that combination with anything other than dread: if these motherfuckers are in power by the time the economy dies, we are in trouble like it's Germany in 1930.

Now let's think about culture and immigration. We've got about 10 million illegal immigrants here. It's a pretty decent number. We also have huge unemployment mostly in the form of an extremely angry underclass who can't seem to get their foot on the ladder. Said immigrants aren't joining America's culture but remain very separate. Anti-immigrant sentiment with these two factors is inevitable: the economic thorn in the side of the nation is reacted to at a deep emotional level. This cuts away at key, even core, pieces of America's national identity. For all it's flaws "we're all American's here" has a magic to make people who's races have hated eachother since before the time of Christ cooperate happily.

I can't ignore the economic problems. That's the real story, the real backdrop. As a culture we're mortgaged past what we can ever afford to pay back and this situation is only getting worse as we continue to spend ourselves into bankruptcy.

So the question is not "is it going to tear?" but "when is is going to tear, and how?"

The keystone is other nations buying our government debt. If America's Will to Pay is seen as slack - by god, if the American government starts missing payments or inflating currency beyond what investors can tolerate... or the stock market caves... or the real estate bubble pops...

This is what has to be faced: we've eaten the economy from the inside out in a maze of increasingly over-leveraged financial instruments and a culture in which your credit score says more about your buying power than your wealth. What we have now is the world's biggest game of chicken: can we land this thing, start stabilizing the economy, without crashing it? Can we skirt the edge of the financial collapse that a loss of faith in the Federal Goverment would produce? The Supreme Court's ruling against trials in Guantanamo Bay is probably the best thing we could have wished for in restoring the international perception that America is a Real Country and not the world's largest, most dangerous Banana Republic.

Interestingly enough, the stock market has begun to stabilize - price/earnings ratios have slid in the face of a number of factors, 9/11 and the associated economic slowdown possibly among them.

Does this indicate we can balance the factors? What, exactly, do we have in our corner against all of this?

We need revolutionary change in three key areas.

1. Our CO2 emissions and other environmental impact need to fall 90% over 50 years, with the first 50% of that ASAP.
2. We need to stabize our economy and get the national debt down to something vaguely reasonable. This likely means actually sorting out basic American pathologies around health care, pensions, stock market speculation and overabundant military spending.
3. We need to figure out how the essentially secular Federal Government deals with the intrusions of the Religious Right to ensure that we do not slip into a counter-Theocracy run by President Ann Coulter and VP Pat Robertson.

We're going to need a massive economic boom - based on real productivity gains - to buy back all of our debt from the people currently holding it and cover future Medicare bills - effectively we need to consistently outcompete and outproduce China and the others holding our debts and make enough money over that to pay for a nation of old people's medical bills. How on earth is this going to happen? Nanotechnology? Genetic engineering? The Energy-Efficient Design Science Revolution?

All of the above, perhaps. But this is what it's going to take to pay down that damn debt. And it's going to have to be greener than hell or we'll completely trash our environment in the boom spending, as well as failing to correct the development trajectory of the developing world in the process.

Finally, at a cultural level, we have to stop pretending that the opposite of Religiosity is Atheism. Both believes are centered around beliefs about God, rather than around the visible evidence. Any Atheist who says that the Universe "just happened" is talking smack: we have no idea, at all, how this place came into existence, and to rule out any possibility when we have essentially no ideas about First Cause is rediculous. It's an act of faith to say "there is no God."

The opposite of Religiosity and Atheism both is Agnosticism: "I don't know, I'm waiting for evidence." Before we discovered the theory of evolution and came up with a compelling model of where animals come from it was a bad bet - intellectually dishonest, even - to rule out the possibility that they had been individually forged by a Creator. We just had no convincing model of where the species originated from. We have the same problem now about matter and energy: we have no convincing models of where matter and energy originate from. I think the jury is legitimately out on "where did the universe come from?" and while we have mysteries of that size in open view it's not intellectually dishonest to say "maybe there is, maybe there isn't." Our Government, to the extent it has any stance at all, must be Agnostic: respecting all possibities without allowing anybody's certainty to run roughshod over the civil liberties of anybody else.

In the midst of all this I've come to an unexpected conclusion: we have a shot. It's going to take a lot of very smart, very motivated people to figure out how to take it, and it's going to take productivity gains on the scale of the Industrial Revolution. But, by god, if we can't accelerate progress by a factor of 10 using this Internet thing and the collective intelligence aggregation it allows... what were we waiting for, mental telepathy? If we can't leverage our incredible science and technology and capital into huge real bottom-line productivity and production increases we're just not thinking.

I almost don't want to believe we have a shot because, if I do, it means I have to try and do my part. That's a responsibity I don't want: I've broken my life too badly trying to solve problems on that scale before. The fact I made some difference on those scales does not mean I didn't pay like hell.

We're going to need to do is get a factor 10 increase in basic productivity just to survive the combination of previous government overspending and greening the economy. This is possible, it's happened before with much less interesting technological shifts than the Internet and all that goes with it. But we're going to need to reorient our production processes around these new tools in a reorganization of society as profound as the move from farm laborers who worked with the sun to machine operators who lived on machine time and worked in countersolar shifts.

Wikipedia and Linux are great examples: incredibly valuable artifacts produced through open licensing enabling massive cooperation, "commons based peer production" as the say. A new mode of production which embraces and extends capitalism. Companies and individuals, working together to produce goods which nobody control... Capitalism may indeed have found it's successor form, not fading away, but being integrated into a new economic model, much as pre-GPL models of collectivism continue to exist under capitalism in the form of communes, churches and other institutions.

I think I understand what part of this acceleration looks like. Imagine a fundamental acceleration of our basic business processes by finding new ways of getting all of the best and smartest people available on the most critical and profitable problems. Think "virtual Manhattan Projects" on environmental issues like super-efficient cars.

No more second raters who take three days to answer a question a real expert could answer in half an hour: find the expert, email the expert, pay them $200. Microconsultancy where you get the best answer not just the easiest one. Reputation-enabled databases to enable a team to find their Brain. Just how much productivity is lost through using the "best brain available" rather than the "best brain, period" - one or two factors of ten, perhaps?

Imagine ferocious new forms of project management, things which make Agile Development look staid. Round-the-clock develoment cycles with virtual teams -but this time, every year or so, let's take a third of each team and relocate them by one timezone so people get to know each other.

Crazy? Crazy enough? C'mon folks, we have a crisis here! The sky is on fire, let's make some fucking money to pay to put it out!

Joi Ito wondered what he was learning from World of Warcraft? Want to know what I think it is? :) It's massive cooperation between actors with deep specialization who have to work as teams and who never meet face to face.

It's going to take a shift as radical as the original Industrial Revolution on the social, cultural and business levels to pull us out of this hole we've dug ourselves into. It's not about the machines but about the business and productivity revolution they enable.

On this level, what is the Internet for? Two things:

1. Finding a usable resource which solves a problem you have.
2. If there is no such resource, finding somebody to make it for you.

Usually those "resources" are facts or tools like software. You have a question, you look it up online, you proceed with your project. You can't find an answer, but you can find an expert, so you make contact and ask. Sometimes you've got to pay them...

Now, what happens when these "experts" are the best people in the field, rather than the best person locally available? Better information leading to better decision-making.

How much is that worth nationally right now? How many dumb business decsions has Google saved companies from? So what if we generalize and accelerate the process further and really focus on trying to streamline the idiocy out of our fundamental business processes using the Internet's ability to focus expertise on remote probems. Dumb? Dumb no longer.

When we say "knowledge worker" what we really mean is a person who's bored most of the time by the limited scope their own company gives them but can't get paid to ply their expertise over the sea of problems out there they could be focussing on.. What's the odds that Fred in Cubical Four is, right now, for the next few hours worth five times more to your competitors than to your own company?

Let us say they have a problem. Fred has the knowledge to solve their problem easily but he doesn't know they about it. The entire economy loses: this is a market failure if Fred is anything other than a replacable cog. It's a market failure caused by locking people up to jobs which almost always underutilize their real capabilities. Just like Ricardian advantage, everybody should do what they do best all of the time to get the maximum good for both the individuals and the whole. But our business models are still based on industrial systems where simply having a body stand by the machine was enough. A desk or a computer is not a machine in the same way a spinning jenny was and the fit between the thing that needs done and the person doing it is much, much more important in our highly complex and technical world.

So let's make Fred a freelance so that, in theory at least, he's always working on things which are well suited to his talents rather than sitting around bored. Now we've got a Coaseian probem: the transaction costs of getting Fred to work on problems may exceed Fred's actual contribution. Enter the Internet and better approaches to handling knowledge workers: reduce the transaction costs, fully utilize Fred's expertise and brilliance, and the entire economy benefits.

I'm picking this as a for-instance, but if we reorganized around the very best person available, nationally or globally, for each task is the person who does it rather than our current system, where limited knowledge often results in suboptimal employment of human intelligence?

I'm serious here people. What's the potential gain in national and global productivity from a realignment in the way we work along these lines.

We need another Industrial Revolution. We haven't even begun to see the social and business impact of the Internet yet.

I think there is a lot more to see like this fit-of-person-to-task optimization once the blinders are off.

When the goal is to save our nation from crushing debt and environmental destruction, and the task is a tenfold increase in American productivity to pay for it all, I think we can afford to get smart, ask hard questions, and figure out how to accelerate right the hell out of the problems we face. We are screwed enough that we need a factor ten jump across the board, and that has to start with much, much better decision making.

And this is just a for-instance: if we look at the world with such incredibly high and improbable goals, what will we see that is currently hidden from sight because we are looking down and not up?!!

I'm ready to start work. Let's get a revolution started.

[Thomas Bjelkeman-Pettersson]

My limited experience working like this is that it is a lot harder to make this work than it is to describe it in an essay. But then most things are. :) It seems to me that most work, however revolutionary or world changing it may be, requires a lot more sweat than brilliant insight.

Genius is one percent inspiration and ninety-nine percent perspiration. Thomas A. Edison

Ideas are cheap. Implementation matters. Of course, you have to be implementing the "right" idea, otherwise you probably destroy value rather than create value.

When I first saw that Yahoo had received Venture Capital funding for a hand-edit catalogue for the "whole internet" i thought. "What a stupid investment. I could do that!" Which is probably true, but I didn't, and as a result didn't go an create one of the biggest star companies on the internet. A clear example of implementation that mattered.

Trying to organize people in a smoothly working, interlocking structure, where the "best" people are used for everything has (as you observed) probably way too high transaction costs. The "best" people are not always available, but in my view, the problems with the idea of employing "the very best person available" for each task are several:

• most tasks that matter require quite a lot of ramp-up time to do well
• coherent implementation of an insight often require an in-depth understanding of the issue, which only comes with time
• most large scale implementation of anything requires teamwork, good teams require time to build, great teams are nurtured slowly and carefully
• most people are not interested in switching their context: team, work, tools etc. very frequently often

Also, working as a freelancer requires that you do sales and marketing regularly. Job security (perceived or otherwise) is something which people value highly and the whole financial system is built around you having it if you want to do something like borrow money. Most people like (perceived) job security.

Also, when you have important stuff that needs to be built / worked on, how do you find and allocate the "best" people? For example, we have a couple of web-technical job / intern openings at Akvo, but how do you reach out and find the "best" for this job?

[Vinay Gupta]

Thomas, I think the tech required to do this task - fitting work to people in an optimal way - is at least as hard as (say) inventing the search engine was. It might be as hard as the financial system is, in the limit.

But I also think that the journey of a thousand miles starts with a single step. Framing the possibility of optimal fit between capabilities and tasks as a global optimization akin to, say, energy efficiency or just-in-time delivery or any of the other broad-class optimizations that have fueled economic revolutions in their respective areas makes it possible to conceive of working directly on the problem.

For example, right now, there's no commonly accepted social protocol for paying somebody for 15 minutes of work. Typically you need to have social capital with somebody with expertise in a field, then you call them up and say "hey, I was wondering if you could take a look at something for me" and usually it's not a paying transaction. The result is a limit to how much of this kind of "thin slice" consulting work gets done. I had somebody pay me the other day for thirty minutes of work and it was a very interesting moment for both parties - realizing that 30 minutes is what was required, and also that it had substantial monetizable value because it relied on a specialized capability.

But a lot of times, this sort of thin-slice stuff is what is actually needed. You hit some problem with a config file for a database - well, somebody who works administering that database every day knows exactly how to fix that problem. But it'll take you two hours to sort it out from the FAQs - where's the mechanism to say "get me a MySQL guru who knows this config file please" and actually have one show up?

Of course, the first time you work with said guru there are additional transaction costs. But if you had somebody like that on tap just for the hard stuff in affordable slices, would it help?

I find this a lot: I need 20 minutes of time from somebody who really understands cholera transmission, or a single number from somebody who's currently tracking hydrogen vehicle adoption closely - and yet there's no convenient mechanism, market or otherwise, for tapping into other people's deep expertise unless you need a substantial slab of their time.

I think the existing economic frameworks around consulting work well for gigs of a few days to a few weeks, things where you actually need a substantial deliverable from somebody. And, in those cases, usually you don't need enormously deep expertise - you just need somebody who can get the job done in a professional fashion. But there are areas where what's needed is a tiny slice of attention from somebody who's really, really good and is working day-in day-out in the areas that you're interested in.

Most often that's fixing a specific hard problem in a longer job, or offering an opinion about a course of action based on in-depth understanding. Medicine actually does this fairly well - sending something over to another doctor for an opinion is a well-understood practice, and often that opinion comes in pretty small slices ("go up to 150mg the dose is too low, that's why the bloodwork looks funny").

I just notice a lot of times people actually want an expert opinion or a very specific fact or a specific problem solved, go to google, can't find something definitive, and either spend a bunch of time doing the research themselves, or going forwards with inadequate data or a work-around.

I think there's really some space here to do something, and it's mainly about social protocols, not technology.

[Vinay Gupta]

Oh, and it's not Yahoo Answers because there's no framework of professionalism or clownproofing there.

[Thomas Bjelkeman-Pettersson]

I used to pay may London lawyer in 6 (six) minute increments. So maybe lawyers have something to teach us in this? (And he is a very good lawyer too.)

You and I are down to 4 hour increments I think so far. But I believe it to be a painful transition for those that try to get this done.

How about an expert pool that you sign up to and people can test you out for a lower fee? Something that looks a little bit like LinkedIn, with public recommendations and relationships showing all the work which has gone on via the system? Doesn't RentaCoder do something like this?

[Vinay Gupta]

Six minute increments! Very, very good lawyer

I think the keys are twofold:

* how do you find the people with knowledge in the relevant area - and some of that is about having a naming scheme for knowledge, of course. (very hard)

* figuring out if the people are any good / any fun to work with. (also very hard)

On the other hand, if people were asking me about specific stuff four or five times a week that was right off the top of my head, in my areas of expertise, and in return I could frame questions for other people in a fairly-real-time way, I think that would radically increase my overall output. How hard are we willing to work for an extra 5% or 10% capability?