“It is difficult to make predictions, especially about the future,” says a proverb often attributed to Yogi Berra. Imagine the world of freedom, or lack of it. Who could foresee the technologies that make our lives so rewarding and convenient? The same technologies have us all under the government’s giant microscope. Thankfully, the brave have turned the microscope around.
In the months since Edward Snowden revealed the nature and extent of the spying that the National Security Agency (NSA) has been perpetrating upon Americans and foreigners, some of the NSA's most troublesome behavior has not been a part of the public debate.
The problem for NSA apologist is that when guys like Snowden disclose that the government conducts comprehensive surveillance in ways that would have made 1984’s O’Brien drool, it puts the entire progressive agenda in jeopardy.
The east coast and parts of the southern U.S. were to varying degrees paralyzed by blizzards a few weeks ago. The snow as expected rendered the roads treacherous, and in anticipation of slick streets, shoppers flocked to the grocery stores in advance.The rush into grocery stores, and its aftermath, offers worthwhile lessons in economics.First up, […]
The financial world is plodding along like a drunken sailor avoiding debt collectors by keeping no cash in his wallet. It’s not the kind of calm that’s going to last or end well. But the storm will have to wait until after the Olympics.What a game! We’ve never watched ice hockey closely before. But watching […]
In times of war and national emergency, it’s sometimes necessary to sacrifice civil liberties to secure vital gains in public safety. In those cases, we may have to accept a loss of privacy or freedom rather than invite mass slaughter of Americans.The National Security Agency’s domestic phone records collection is not one of those.Never have […]
Last year was quite the year for Bitcoin. We’ve seen exponential growth in Bitcoin’s exchange rate and extensive coverage in the media. Another phenomenon we have witnessed is the proliferation of alternative cryptocurrencies, five of which we’ve provided below.What all of these cryptocurrencies have in common is that they rely on a decentralized network to […]
Image: ShutterstockBitInstant CEO Charlie Shrem, along with alleged co-conspirator Robert Faiella, was arrested by federal authorities last week for allegedly laundering more than $1 million worth of Bitcoins. This is a tiny amount compared to the largest drug-and-terrorism money laundering case ever. Yet when British bank HSBC was found guilty in 2012 of laundering billions, […]
The exercise had an awesome name, inspired by the movies: “Quantum Dawn 2.”On July 18, scads of U.S. banks, stock exchanges and government agencies took part in a digital fire drill — a practice run in the event all of Wall Street came under massive cyberattack.This isn’t the first time banks have come under an […]
The faces of the Detroit bankruptcy are the thousands of pensioners whose promised benefits are suddenly part of the restructure negotiation. When Motown filed for Chapter 9 last July, the city had $11.5 billion in unsecured liabilities. The vast majority of this was pension and health care benefits owed to retired city employees.The images of […]
The New York Times published an interminable article on health care recently. Plenty of facts — how scrupulous are these journalists! — but the article displayed absolutely no comprehension of the basics of cause and effect. I was left wondering about the whole point.The article details how the health care system rewards specialists to an […]
We’ve pointed out in the past that President Obama’s views on the surveillance state shifted completely from when he was Senator to when he was President. As Senator, he supported a bunch of reforms that are very much like the ones his panel have suggested — and which he’s about to ignore. The NY Times […]
Bitcoins are largely considered digital currency (or “crypto currency”) so you’d expect it to be treated like currency on a retail web site. But the Internal Revenue Service might not think so.
The great inventors/businessmen of the First Industrial Revolution, such as James Watt and Matthew Boulton of steam-engine fame, were not just smart but privileged. Most were either born into the ruling class or lucky enough to be apprenticed to one of the elite. For most of history since then, entrepreneurship has meant either setting up […]
Both research and production look poised for a revolution as 3-D printing applies its high-tech charms to the business of creating chemical compounds and turns the production of medicine into a DIY project.
“Tea. Earl Grey. Hot.”When Capt. Jean-Luc Picard wants a steaming beverage in his ready room aboard the starship Enterprise, he just utters those words. The ship’s “replicator” then assembles the necessary atoms — including those for the cup — and produces it, ready for the drinking. Picard thinks nothing of it — it’s hardly more […]
The market has selected different things as money throughout history. Some of these items have served as money in isolated places for specific periods of time — for instance, cigarettes in prisoner-of-war camps. Cigarettes continue to be a currency in prisons if allowed, but if not, according to Wikipedia, “postage stamps have become a more […]
[Ed. Note: This article originally published on Jan. 24, 2013]Stocks up. Gold down. Bitcoin… waaay up.The S&P 500 busted through the 1,500 mark this morning. Stocks haven’t been this expensive since 2007… right before they got a whole lot cheaper… for a whole lot longer. Gold, meanwhile, dipped a tad. This, despite central bankers of […]
Before the housing market collapsed and the government pumped billions into the economy to save it, there was a programmer named Satoshi Nakamoto. And without much fanfare, he created an idea that’s in the process of changing the world. His idea was Bitcoin.Some background information is in order before I go any further.Think back to […]
Americans are still trying to get a handle on the full extent of the government’s domestic spying activities, including the recent revelation that the National Security Agency (NSA) has been collecting and storing the email address books of ordinary Americans using online messaging services. Many users of such services are looking to tech executives for […]
The online Internet exchanges created by the Affordable Care Act are up and running.OK, they’re up. Uhh, OK, some of them are sort of up.It has been almost a week since last Tuesday’s initial launch, and there have been more than a few problems.Website crashes, excessive response times and other problems have plagued the exchanges. […]
A growing consensus of IT experts, outside and inside the government, have figured out a principal reason why the website for Obamacare’s federally sponsored insurance exchange is crashing. Healthcare.gov forces you to create an account and enter detailed personal information before you can start shopping.This, in turn, creates a massive traffic bottleneck, as the government […]
As much as I love technology, part of me hates being so dependent on a live wall plug wherever I go. You find yourself trapped in some setting without accessible wall plugs and your phone is dying. You charge from you laptop, but that is dying too. You take recourse to your tablet, but that […]
U.S. and British intelligence agencies have successfully cracked much of the online encryption relied upon by hundreds of millions of people to protect the privacy of their personal data, online transactions and emails, according to top-secret documents revealed by former contractor Edward Snowden.The files show that the National Security Agency and its UK counterpart GCHQ […]
Today, like most days, I fired up my computer.I read freely available information on the latest developments in technology that would, in the not too distant past, have required a drive to a library to flip through journals too numerous for me to afford. I read the latest national and global news without having to […]
On a Sunday afternoon swim, a 6-year-old boy was bugging me in a sweet sort of way. He rode up and down the handrail on the stairs in the shallow end of the pool where I was trying to sit in peace. He was laughing and talking, but I couldn’t understand a word through the […]
I’ve just completed a heavy schedule of talks at the Agora Financial Investment Symposium in Vancouver. All my talks centered on information economics, Web startups, and the productivity of the Internet and its meaning. As usual, I learned as much from the attendees as (I hope) they learned from my talks. The research I did […]
What kind of events are worth reporting on in real time, with updates every few seconds? Such events have to be pretty dramatic. Well, the release of the iPhone 5 apparently qualifies. The tech blogs were all over it, and so were the wire services and big papers.
A moment to celebrate? Sure! It was the smart phone that changed the whole way people live and access information in our time. The smartphone…is nearly everything you can think of in the size of a deck of cards. It is the greatest consumer product in human history heretofore. Its hype but totally justified.
Maybe you have had this experience. I’ve recommended smartphones to flip phone users, and they never stopped thanking me.
Meanwhile, I’m getting serious upgrade cravings. Suddenly, my iPhone4S has cobwebs on it. I have to blow off the dust to make a call. It is ugly and stupid and slow with a tiny screen, and the battery runs out too fast. Might as well be a telegraph machine or a smoke signal or a note in a bottle. This museum piece must die.
Some cynics think: oh sure, you want me to cough up yet again for a gadget I don’t need. Well, fine. if you don’t like the phone, there is a simple solution. Don’t buy it. That’s the essential glory of a market economy. It has to persuade us to participate. If we don’t want to, we don’t have to. But don’t put down the longing for improvement: this is the drive that pushes history forward.
It’s not so easy in the world of politics. The government rolls out its new reforms and then forces them down our throats. We have no choice but to believe its experts and scientists and bureaucrats, and comply, on penalty of jail time. If you disagree, you are called an outlier, an extremist, even a danger to society.
The first iPhone went to market in 2007. Just look how far the entire smartphone industry has travelled in these years. That same year, the U.S. entered into a recession that the government swore it would fix. Not only has government not fixed the problem, middle class income continues to shrink under the supposed fix, unemployment still worsens, and there is no end in sight.
In the background, in the world of digits and technology, revolutions were happening. While enterprise working in the digital world has created wonders, government has created disaster and sacrificed untold amounts of unseen potential wealth with its parasitic and backward policies of bailout, spend, regulate and print.
To make matters worse, the G-men have done nothing since 2007 but hector, harass, threaten, and badger makers and innovators of smartphones. Congress has been holding hearings for five years, there’s always some Justice Department investigation, and the regulators never stop looking for some far-flung imperfections in the way smartphones are marketed, the hardware and firmware, the app economy, the carrier contracts, and every aspect of how these innovations have worked.
Most absurdly, Congress has pretended to protect us from the dangers of how smartphones are tracking our movements and storing private data on our lives. Doctors, heal yourself! There are a thousand government agencies down the street that are doing just that, and they aren’t trying to sell us stuff. They are spying on us to take our liberty and property without our consent. The supposed violations of our rights pushed by new technologies typically involve selling us stuff we want.
History will record that government did absolutely nothing to create the smartphone and everything possible to hobble its development. The whole thing is quite insulting. If government had its way, we would still be using switchboard operators. The private sector companies that innovate and sell us these products truly are revolutionaries against a static and decrepit political system.
When was the last time any public sector agency actually created something to enhance our lives? I can’t remember one. But every morning I still see the postal employee driving around a truck and sticking things in mailboxes, and I see yellow school buses from fifty years ago carting kids to their daycare prisons, and I sometimes have to go to government agencies with tellers using technology from the 1930s.
And then we look at the private sector and see miracles unfolding by the day. We not only expect them. We demand them. And then we tolerate no rollback ever. How many people would trade in their iPhone 4 for a flip phone that itself was a dramatic upgrade from anything available even ten years ago? If people were forced to do this, it would be seen as a human rights violation.
And once people get used to the new iPhone or whatever amazing gadget is being pushed by Android or Samsung, the excitement lasts about a day. Then people just figure that this is the way it is: progress is just part of life itself. We take it all for granted. But we demand no such thing from government. We have the lowest expectations possible for the public sector and impossibly high expectations for the private sector.
My favorite example of this weird confluence comes from airports. We approach the security line with trepidation, careful to remove our shoes, strip down, bag our creams and toothpaste, and say “yes sir” and “yes ma’am” to every demand. We put up with their glares and stares and subject ourselves to every abuse.
We cross through security and enter the glorious marketplace of airport commerce. Here we find merchants reaching out to us, serving us, giving us everything we want, creating ever more amazing things for us. I can get a massage, buy some shoes, have a drink, take a nap, or stock up on chotskies that sample the local culture.
Despite the TSA’s claim that they are there to serve us, the real servants are found only once we pass through the public-sector gauntlet. And yet how do we treat the waitress who brings us that greasy burger? We complain that it didn’t arrive fast enough, that the tomato is stale, that the fries are cold. We say things to these servants we would never dare to say to the TSA.
And yet, no matter how much abuse we heap on the private sector, it somehow forges ahead. The glaze of the entrepreneur is always toward the future. It is to do what hasn’t yet been done, and always for others. It is only through doing the exceptional thing in service of society that profits are made. One must leave the crowd, invent and market the new thing, take on the status quo, blow up what exists and make something new that had never been imagined before.
To make new is the great challenge of life. Any society and any system can repeat what has been done in the past, but the result of that is stagnation and eventual death. When economic forces are left to individuals and their creative longings, we experience that most glorious thing called progress.
That’s why the private sector is forever surprising us with things that serve needs we didn’t even know we had. Think of it. No bureaucrat ever thought of the smartphone. None of us did. It took a global community of self-interested, market-coordinated producers, thousands and even millions of people wildy interested in making a buck by bringing people cool stuff, to come up with the smartphone.
And despite his vaunted reputation, Steve Jobs didn’t come up with it either. He drew from existing technologies and worked with the best people in the industry to come up with a way to package and market the greatest stuff in existence, rolling out a primitive version and improving it along the way through trial and error, always with a forward and upward glance.
The future is never certain in the world of commerce. As Daniel Cloud shows in his wonderful book The Lily, there is an element of the market economy that is pure play. You never know what is going to work at the outset. It’s always a speculation. The new product or service, the new attempt to try what has not been tried before, always seems a bit crazy.
And it is a bit crazy…not to mention risky. But this is the way toward greatness. As Cloud says, “the real reason the entrepreneur’s profits don’t quickly get arbitraged away is that it takes people who aren’t quite as creative a long time to realize that he is not crazy and begin to imitate him, and by that time, he’s already moved on to some other uncertain project on the basis of some new keen hunch.”
Entrepreneurship, he writes, is about “individual intuitions about objective uncertainties.”
People are said to be gadget weary. Nice problem to have! If the world were ruled entirely by government, we would experience nothing new, just the same old sinking into the mire of the old and worn out. That world is never new and improved.
Whether you buy the new gizmo or not, its creative engine represents a force that is forever renewing the face of the earth and the experience of humanity itself. This is something to celebrate, and never take for granted.