When we think about the future, we hope for a lot of progress.
That progress can take one of two forms. Horizontal or extensive progress means copying things that work— going from 1 to n. Horizontal progress is easy to imagine because we already know what it looks like. Vertical or intensive progress means doing new things—going from 0 to 1. Vertical gain is harder to imagine because it requires doing something nobody else has ever done. If you take one typewriter and build 100, you have made horizontal progress. If you have a typewriter and create a word processor, you have made vertical progress.
At the macro level, the single word for horizontal progress is globalization—taking things that work somewhere and making them work everywhere. China is the paradigmatic example of globalization; its 20-year plan is to become like the United States is today. The Chinese have been straightforwardly copying everything that has worked in the developed world: 19th-century railroads, 20th-century air conditioning, and even entire cities. They might skip a few steps along the way—going straight to wireless without installing landlines, for instance—but they’re copying all the same.
The single word for vertical, 0 to 1 progress is technology. In recent decades, the rapid advancement of information technology has made Silicon Valley the capital of “technology” in general. But there is no reason why technology should be limited to computers. Properly understood, any new and better way of doing things is technology.
Because globalization and technology are different modes of progress, it’s possible to have both, either, or neither at the same time. For example, 1815 to 1914 was a period of both rapid technological development and rapid globalization. Between the First World War and Kissinger’s trip to reopen relations with China in 1971, rapid technological growth was not much globalization. Since 1971, we have seen rapid globalization along with limited technical development, mostly confined to IT.
This age of globalization has made it easy to imagine that the decades ahead will bring more convergence and more sameness. Even our everyday language suggests we believe in a kind of technological end of history: the division of the world into the so-called developed and developing nations implies that the “developed” world has already achieved the achievable and that poorer countries need to catch up.
New technology has never been an automatic feature of history. Our ancestors lived in static, zero-sum societies where success meant seizing things from others. They created new sources of wealth only rarely, and in the long run, they could never produce enough to save the average person from a tough life. Then, after 10,000 years of fitful advance from primitive agriculture to medieval windmills and 16th-century astrolabes, the modern world suddenly experienced relentless technological progress from the advent ofthe•steam engine in the 1760s up to about 1970. As a result, we have inherited a more prosperous society than any previous generation would have been able to imagine.
Any generation excepting our parents’ and grandparents’, that is: in the late 1960s, they expected this progress to continue. They looked forward to a four-day workweek, energy too cheap to meter, and vacations on the moon. But it didn’t happen. The smartphones that distract us from our surroundings also distract us from the fact that our surroundings are strangely old: only computers and communications have Improved dramatically since midcentury.
New technology tends to come from new ventures— startups. From the Founding Fathers in politics to the Royal Society in science to Fairchild Semiconductor’s “traitorous eight” in business, small groups of people bound together by a sense of mission have changed the world for the better. The most straightforward explanation for this is cynical: it’s hard to develop new things in big organizations, and it’s even harder to do it by yourself.
Bureaucratic hierarchies move slowly, and entrenched interests shy away from risk. In the most dysfunctional organizations, signaling that work is being done becomes a better career advancement strategy than actually doing work. At the other extreme, a lone genius might create a classic piece of art or literature, but he could never make an entire industry. Startups operate on the principle that you need to work with other people to get stuff done, but you also need to stay small enough so that you actually can.
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