The Futurist

A Rebuttal to 'Peak Oil' Doomsday Predictions

At The Oil Drum, a detailed article by 'Gail the Actuary' speculates on how declining production of oil combined with rising demand will cause an economic catastrophe, leading to the global economy contracting so severely, that by 2040 it is much smaller than it is today.  The author actually believes that in 2040, most people will no longer be able to afford cars, electricity will be unreliable, and goods and services will be fewer and rarer than today. 

Another article submitted by an different contributor on The Oil Drum arrives at the same pessimistic conclusion, stating that 'economic growth will end one way or another'.  Most of the commenters on both articles are in a groupthink state of agreement that can best be described as a Maoist-Malthusian cult. 

I would normally not bother to rebut something like this, except that this particular essay is so stunningly wrong and annoyingly pessimistic, despite the seemingly meticulous research the author has conducted, that I am compelled to disect how insulated groupthink can spiral into a zone where even the most extreme conclusions are accepted. 

Note that I happen to be someone who actually does believe in Peak Oil theory, but that such a condition generates long-term positives that outweigh short-term negatives. 

The assumptions that the 'Peak Oil' doomsday scenario makes are :

1) That rising oil prices do not cause a long-term downward adjustment in demand.  Oil demand may be inelastic in the short-term, but in the long term, people will buy more efficient cars, carpool, ride bicycles, reduce discretionary trips, conduct more commerce online, etc.  To assume otherwise is to ignore the most basic law of economics.  This is before even accounting for the indirect benefits of declining oil demand such as a drop in traffic fatalities (which cost $2 million apiece to the economy), less wear and tear on roads and tires, less pollution, less real estate consumed by gas stations, less competition for parking spaces, etc. 

2) That rising grain prices will not move consumption away from increasingly expensive meat towards affordable grains, fruits, and vegetables, thereby reducing grain and water demand.  This, too, is economic illiteracy.  If the price of beef triples while the price of rice and potatoes does not, consumption patterns shift.   

3) That there will be very little technological innovation in alternative energy, automobile efficiency, batteries, or information technology from this point on.  In fact, there is innovation in all of those areas, so we have multiple layers of protection against the doomsday scenario, as detailed by these articles :

A Future Timeline for Energy

A Future Timeline for Automobiles

Batteries Set to Advance, Finally

Solar Energy Cost Curve

Terrorism, Oil, Globalization, and the Impact of Computing

4) That most economic growth is not in knowledge-based industries, which consume far less energy per dollar of output.  The US economy today produces twice the financial output per unit of oil consumption as it did in 1975, with information technology rising as a portion of total economic output. 

5) That a major economic downturn, featuring skyrocketing food prices for people in poorer countries, will somehow not translate to a lower birth rate that inhibits population growth and hence curbs demand, and that population projections will somehow not change. 

6) That there will be no humans living beyond the Earth (whether in orbit or on the Moon) by 2040.  The reason this point is relevant is because a society cannot advance in space travel without simultaneous advances in energy technology.  I say that advances in photovoltaic efficiency make Lunar colonies closer to viability by that time. 

7) That we are going to have over 30 years of negative growth in World GDP, despite not having had a single year of negative growth since 1973, and despite the trendline of growth solidly registering at 4.5% a year even today.  I happen to think that by 2040, the world economy will be 4 times larger than it is today.  Even the Great Depression was only 5 years of negative growth, followed by a recovery that elevated prosperity to levels higher than they were in 1929, at a time when World GDP was only at a trendline of 2% annual growth, or less than half the level of today.  Yet Gail the Actuary thinks car ownership will no longer be affordable to most people by 2040. 

Peak oil may be on the horizon, but the US economy has already adapted to oil at sustained prices of $70 or $80/barrel (which is the biggest story that no one is noticing yet), and will soon adapt to $100/barrel.  I want oil to hit a sustained $120/barrel by 2010 to start a virtuous cycle of technological and geopolitical chain reactions that make the world a better place in the long term.  If oil hits $200/barrel, that will cause a deep recession that could last several years, but after that point, we will have adapted out of the oil burden almost entirely, and World GDP growth will resume at 5% a year. 

Could I be wrong and they be right?  Well, let us first see if oil rises substantially above $120/barrel, and if that year has negative World GDP. 

Does anyone feel like defending the doomsday prediction from The Oil Drum?

Actuarial Escape Velocity

Every now and then, an obscure concept is so brilliantly encapsulated in a compact yet sublime term that it leaves the audience inspired enough to evangelize it. 

I have felt that way ever since I heard the words 'Actuarial Escape Velocity'.

For some background, please refer to an older article from early 2006, 'Are You Prepared to Live to 100?".  Notice the historical uptrend in human life expectancy, and the accelerating rate of increases.  For more, do also read the article "Are You Acceleration Aware?".

In analyzing the rate at which life expectancy is increasing in the wealthiest nations, we see that US life expectancy is now increasing by 0.2 years, every year.  Notably, the death rates from heart disease and cancer have been dropping by a rapid 2-4% each year, and these two leading causes of death are quickly falling off, despite rising obesity and a worsening American diet over the same period.  Just a few decades ago, the rate on increase in life expectancy was slower than 0.2 years per year.  In the 19th century, even the wealthiest societies were adding well under 0.1 years per year.  But how quickly can the rate of increase continue to rise, and does it eventually saturate as each unit of gain becomes increasingly harder to achieve?

Two of the leading thinkers in the field of life extension, Ray Kurzweil and Aubrey de Grey, believe that by the 2020s, human life expectancy will increase by more than one year every year (in 2002 Kurzweil predicted that this would happen as soon as 2013, but this is just another example of him consistently overestimating the rate of change).  This means that death will approach the average person at a slower rate than the rate of technology-driven lifespan increases.  It does not mean all death suddenly stops, but it does mean than those who are not close to death do have a possibility of indefinite lifespan after AEV is reached.  David Gobel, founder of the Methuselah Foundation, has termed this as Actuarial Escape Velocity (AEV), essentially comparing the rate of lifespan extension to the speed at which a spacecraft can surpass the gravitiational pull of the planet it launches from, breaking free of the gravitational force.  Thus, life expectancy is currently, as of 2007 data, rising at 20% of Actuarial Escape Velocity.

I remain unconvinced that such improvements will be reached as soon as Ray Kurzeil and Aubrey de Grey predict.  I will be convinced after we clearly achieve 50% of AEV in developed countries, where six months are added to life expectancy every year.  It is possible that the interval between 50% and 100% of AEV comprises less than a decade, but I'll re-evaluate my assumptions when 50% is achieved. 

Serious research efforts are underway.  The Methuselah Mouse Prize will award a large grant to researchers that can demonstrate substantial increases in the lifespan of a mouse (more from The Economist).  Once credible gains can be demonstrated, funding for the research will increase by orders of magnitude. 

The enormous market demand for lifespan extension technologies is not in dispute.  There are currently 95,000 individuals in the world with a net worth greater than $30 million, including 1125 billionaires.  Accelerating Economic Growth is already growing the ranks of the ultrawealthy at a scorching pace.  If only some percentage of these individuals are willing to pay a large portion of their wealth in order to receive a decade or two more of healthy life, particularly since money can be earned back in the new lease on life, then such treatment already has a market opportunity in the hundreds of billions of dollars.  The reduction in the economic costs of disease, funerals, etc. are an added bonus.  Market demand, however, cannot always supercede the will of nature. 

This is only the second article on life extension that I have written on The Futurist, out of 154 total articles written to date.  While I certainly think aging will be slowed down to the extent that many of us will surpass the century mark, it will take much more for me to join the ranks of those who believe aging can be truly reversed.  To track progress in this field, keep one eye on the rate of decline in cancer and heart disease deaths, and another eye on the Methuselah Mouse Prize.  That such metrics are even advancing on a yearly basis is already remarkable, but monitoring anything more than these two measures, at this time, would be premature. 

So let's find out what the group prediction is, with a poll.  Keep in mind that most people are biased towards believing this date will fall within their own lifetimes (poll closed 7/1/2012) :

How Far Can 'Medical Tourism' Go?

Studying what lies beneath the surface of market forces can be fascinating.

BusinessWeek has a slideshow depicting major centers for medical tourism, as well as the cost savings of various procedures in relation to the US.  This got me thinking about several dimensions of this concept, particularly since healthcare is 15% of the US economy, yet is also the sector of the US economy, outside of government, where wastage and ineffeciencies are the greatest. 

Many procedures that cost $100,000 or more in the US can be done with equal competence for $10,000 in Thailand or India.  Normally, if something of comparable quality is available for just a tenth of the cost, demand migrates to the cheaper alternative in a huge torrent.  Even after accounting for travel costs, the gulf is immense.  Yet it appears that only a small percentage of US patients for cardiovascular surgery, joint replacements, etc. are going overseas for their operations.  Medical tourism will still only earn a miniscule $4 Billion in 2008 for India, Thailand, and Singapore combined, of which only one-third is from American patients.  Thus, only a fraction of a percent of the US, European, and Japanese healthcare sectors have been dented. 

This, of course, can be due to two reasons :

a) Fears about quality/safety, either real or perceived.

b) Net out-of-pocket cost to the patient still being lower in the US, due to insurance. 

Regarding quality, many of these surgeons are certified by US boards or even educated in US colleges, and accidents do not appear to happen at any greater rate than in the US.  At the same time, it is not possible to pursue malpractice suits against facilities in India or Thailand, which, while certainly an element of risk, itself is part of the reason for their lower price relative to the US.  It is inevitable that some mishap befalls an American patient in Asia, and the media latches onto the story for a week or more, reversing the market demand for medical tourism for years, even if the incidence of such tragedies may be no more than in US hospitals.  In fact, I am surprised it has not happened already. 

In terms of cost, that brings us to the elephant in the room, which is the revelation that it is not India or Thailand that are too cheap, but rather that US healthcare is too expensive to begin with.  I am no expert in this field, but it seems obvious that a lack of market forces in the value chain, a lack of regulation of lawsuits, the horrendous dietary habits of most Americans, and the tendency of consumers to not care about how much the insurance company pays are all contributory factors to what is arguably the greatest tragedy in US economic history.  Socializing the healthcare system will worsen it, for reasons too vast to delve into here.  It is true that many Canadians come to the US for urgent procedures that would require a 3-month wait in Canada. 

However, millions of Americans don't have health insurance at all, and while for some this is by choice, for some it is not.  For them, traveling abroad for a $10,000 heart procedure may be the only affordable option.  Even if the most experienced and well-frequented facilities are in India and Thailand, nearby options also exist in Jamaica and Costa Rica.  Over 20 other countries across Eastern Europe, Asia, and Latin America are also vying for a slice of the pie. 

As unintended consequences ripple through, herein lies the path to forcing some degree of reform of the US healthcare system.  As more Americans either choose or are forced to seek low-cost procedures abroad, even if it is only a small percentage American patients, this will compel insurance companies to include medical tourism options to patients.  The insurance company can offer their own version of malpractice insurance to the patient, cover all travel expenses for the patient and spouse, and even throw in a vacation package and cash incentive.  Even after all this, if the cost of the $10,000 procedure in India or Thailand has now risen to $30,000, it still outcompetes the $100,000 US alternative handily.  Some insurance companies are already starting this with enthusiasm, and before long, all insurance companies will effectively have to compete on this level. 

As the number of Americans combining surgeries with a tropical vacation becomes a small but significant percentage of the total patient pool, the US healthcare system will have no choice but to undertake the difficult reforms to bring costs down at a systemic level, thus benefiting even those Americans who refuse to go overseas, and even procedures that are not candidates for offshoring.  If software development can be outsourced to India where it is one fourth the cost, surgeries cannot expect to be perpetually immune to competition that is a tenth or twentieth of the cost.  Through some combination of tort reform, free-market principles, and preventative focus, US costs will gradually be brought down closer to a market rate.  Perhaps the US can comfortably sustain prices that are 3 times that of Thailand, but not 10 times.  This will be the next industry in the US that is forced to adapt. 

To review, the expected sequence of events is :

1) Americans with no insurance are forced to make a life or death decision to get their surguries abroad, where the service meets or exceeds their expectations. 

2) More insurance companies offer medical tourism with liability guarantees and cash/vacation incentives to American patients.  Only a small fraction of patients are adventurous enough to do this, but all insurance companies are compelled to offer these options.

3) Major centers for medical tourism, after a track record of about a decade, develop solid brands that can attract American patients. 

4) When we finally get to the point that 10% of Americans are traveling abroad for a wide array of procedures, the US will be forced to begin to take measures to reduce costs throughout the healthcare system.  Losing 10% of the market is all that it will take to force some positive changes.  This could begin to happen by 2020. 

Such a sequence of events, of course, will boost the US economy greatly.  Of the $2 Trillion mentioned above, as much as half of that, a whopping $1 Trillion or 7% of the US economy, is estimated to be wastage incurred due to a shortage of market forces in healthcare.  Imagine if that $1 Trillion could be redeployed elsewhere.  A person who saves $90,000 on a heart procedure can choose to use that money on emerging innovations in biotechnology that may be available in the 2020s, such as treatments to slow down or halt some aspects of aging. 

This is not going to be a trend that moves as quickly as some of the others discussed here on The Futurist.  But the economics involved are massive enough that it has certainly caught my eye.  Let's see what happens, both before and after the predicted media frenzy over a foreign medical mishap. 

Update (4/3/08) : Businessweek has an article on how technological advances in medical instrumentation are enabling some surgical procedures to be done with far tinier incisions.  Patients who previously would have to stay in the hospital for a week to recover now can leave in under a day. 

The article also mentions how hospitals are opposed to these technological advancements, as they reduce the number of days of revenue a hospital can collect while a patient recovers after surgury.  This anti-productive, entitlement mentality will hasten the downfall of the US healthcare cartel, as shorter recovery times due to smaller incisions will make a trip to a tech-friendly facility in Thailand or India even more compelling.  When the cost is a tenth and the recovery time is a fifth of what it would be in the US, how long before market forces dominate?

'Outsourcing' - What a Non-Crisis That Turned Out to Be, v2.0

I wrote version 1.0 of this article on November 26, 2006.  16 months later, it is time for version 2.0 to provide more historical context on how misplaced the hype over some fashionable issues eventually turns out to be, and why what once appeared to be a harbinger of doom is now all but forgotten. 

In the 2001-03 economic downturn, the aftermath of the technology bust resulted in hundreds of thousands of software engineers and assorted high-tech workers losing their jobs.  A jittery public was vulnerable to influence from isolationist politicians, with the likes of Lou Dobbs and Pat Buchanan fanning the flames in the media.  As a result, the simple business practice of moving certain components of daily operations to a lower-cost location, if only to keep up with competitors already doing the same, became a dirty word - 'outsourcing'. 

The cover story of Wired Magazine's February 2004 issue was on the outsourcing of software jobs to India.  Within the article, a core theme was the supposedly tremendous hardships that white-collar Americans were about to experience due to a 'giant sucking sound' of jobs going to India.  In the same month, then Presidential candidate John Kerry screamed about the practicies of "Benedict Arnold CEOs" who outsource American jobs to India, hoping to gain the support of isolationists and the economically ignorant.  Elsewhere, very uncharitable things were said by leftists about brown-skinned Indians, due to their rapid adoption of capitalism and globalization at the expense of the leftist plantation where Indians were required to symbolize Gandhian non-violence, zen spirituality, yoga, curries, and the glorification of poverty. 

Let's call February 2004 as time when the bubble of 'outsourcing' fears reached a fevered peak.  Now, what happens whenever a bubble of psychology reaches a peak?

A quick glance at a few economic indicators from the Bureau of Labor Statistics in the 4 years since then reveals the following :

So 7.5 million jobs were created in this short time, the unemployment rate is lower than it has been for 33 of the last 37 years, and wages have risen while real GDP has grown at a 3.2% clip.  There is thus no evidence of job losses, wage erosion, or underemployment over this period.  Take that, Lou Dobbs, Pat Buchanan, John Kerry, Dennis Kucinich, and other assorted demagogues, who have no ability whatsoever to truly grasp the trends that shape our world. 

India, in the meantime, has benefited greatly as well.  GDP growth has averaged 8% a year over this same period, pulling 100 million people out of poverty.  Political ties with the US have strengthened in a manner unlike any previous episode in the last 50 years.  The faster these ties broaden, the better the world will become.  A prosperous India is a critical component to the US achieving favorable outcomes in both the War on Terror and with China, as seen from where India resides on this particular map.  Anti-Americans become apoplectic when they learn that India is the most pro-US country in the world. 

What does the future of outsourcing hold?  Is there still a risk of jobs vanishing from the US at a rate faster than they can be produced, as pessimists still maintain?  Unlikely, even though Internet backbone bandwidth has quintupled in the last 4 years, and many more people in India have PCs and Broadband connections today than in early 2004.  This is because aggregate demand growth has saturated even India's vast labor pool.  Salaries in India have been rising at over 12% a year due to labor shortages, causing their cost advantage to erode.  The Wired article from 2004 stated that the average salary of an Indian programmer was $8000 a year; today, it is closer to $15,000 a year in US dollars.  India itself has started outsourcing to Bangladesh and Eastern Europe, which are much smaller labor pools and will also saturate quickly.  Indeed, the trends favor more job creation in America and India. 

Now that we are in another recession, phony issues like this one emerge again.  Democrats are still speaking in protectionist tones, bashing NAFTA and opposing free-trade agreements with Columbia.  But other than a few pessimists, socialists, and racists, it is unlikely to gain much traction, as Americans have seen that the benefits have outweighed the costs by a handsome margin.  BusinessWeek also had an article from 4/24/07, six months after version 1.0 of this article was post, on how misrepresented the outsourcing issue is.

Thus, the bubble of fashionable pessimism has moved to the next topic, which happens to be the decline of the dollar.  This, too, will turn out to be a passing concern that the economy adjusts to after a brief period of pain.  Among other things, a competitively priced dollar has led to Europe outsourcing jobs to the US, and is also working towards reducing US dependence on oil.  A debunking of the 'weak dollar' fad will be posted on another day. 

Related :

Terrorism, Oil, Globalization, and the Impact of Computing

Why I Want Oil to Hit $120 per Barrel

Outsourced Education - the Latest Flattener

Batteries Set to Advance, Finally

The Economist has a great article on the history and near-future outlook for battery technology. Batteries have scarcely improved in the last century, and there have been too many false starts for a seasoned observer to get his hopes up too easily.  But this chart of battery capacity by unit weight, in particular, is something I have been seeking for a long time.  It vindicates my belief that lithium-ion technology is improving at a rate far faster than traditional nickel batteries (that have scarcely improved at all in the last half-century).  Note, importantly, that if we join the multiple curves, we see a strong indication of the classic accelerating technology exponential curve.  This time we know it's for real. 

This is exciting on multiple levels, because it opens to door to not just mainsteam electical vehicles in the next decade, but to a variety of wearable electronic devices, 20-30 hour laptop batteries, household robotics, and other applications that have not yet been imagined. 

Future projections are usually over-optimistic, you say?  Let's also not forget Stanford University's nanowire research to increase Lithium-ion battery capacity, which was wide acclaimed as among the most important scientific breakthroughs of 2007. 

Related :

A Future Timeline for Energy

A Future Timeline for Automobiles

Why I Want Oil to Hit $120 per Barrel

Is Technology Diffusion in a Lull?

There are minor but growing elements of evidence that the rate of technological change has moderated in this decade.  Whether this is a temporary trough that merely precedes a return to the trendline, or whether the trendline itself was greatly overestimated, will not be decisively known for some years.  In this article, I will attempt to examine some datapoints to determine whether we are at, or behind, where we would expect to be in 2008. 

There is overwhelming evidence that many seemingly unrelated technologies are progressing at an accelerating rate.  However, the exact magnitude to the accelerating gradient - the second derivative - is difficult to measure with precision.  Furthermore, there are periods where advancement can be significantly above or below any such trendline. 

This brings us to the chart below from Ray Kurzweil (from Wikipedia) :

This chart appears prominently in many of Kurzweil's writings, and brilliantly conveys the concept of how each major consumer technology reached the mainstream (as defined by a 25% US household penetration rate) in successively shorter times.  The horizontal axis represents the year in which the technology was invented. 

This chart was produced some years ago, and therein lies the problem.  If we were to update the chart to the present day, which technology would be the next addition after 'The Web'? 

Many technologies can claim to be the ones to occupy the next position on the chart.  IPods and other portable mp3 players, various Web 2.0 applications like social networking, and flat-panel TVs all reached the 25% level of mainstream adoption in under 6 years in accordance with an extrapolation of the chart through 2008.  However, it is debatable that any of these are 'revolutionary' technologies like the ones on the chart, rather than merely increments above incumbent predecessors.  The iPod merely improved upon the capacity and flexibility of the walkman, the plasma TV merely consumed less space than the tube TV, etc.  The technologies on the chart are all infrastructures of some sort, and it is clear that after 'The Web', we are challenged to find a suitable candidate for the next entry. 

Thus, we either are on the brink of some overdue technology emerging to reach 25% penetration of US households in 6 years or less, or the rapid diffusion of the Internet truly was a historical anomaly, and for the period from 2001 to 2008 we were merely correcting back to a trendline of much slower diffusion (where it take 10-15 years for a technology to each 25% penetration in the US).  One of the two has to be true, at least for an affluent society like the US.

This brings us to the third and final dimension of possibility.  This being the decade of globalization, with globalization itself being an expected natural progression of technological change, perhaps a US-centric chart itself was inappropriate to begin with.  Landline telephones and television sets still do not have 25% penetration in countries like India, but mobile phones jumped from zero to 10% penetration in under 7 years.  The oft-cited 'leapfrogging' of technologies that developing nations can benefit from is a crucial piece of technological diffusion, which would thus show a much smaller interval between 'telephones' and 'mobile phones' than in the US-based chart above.  Perhaps '10% Worldwide Household Penetration' is a more suitable measure than '25% US Household Penetration', which would then possibly show that there is no lull in worldwide technological adoption at all. 

I may try to put together this new worldwide chart.  The horizontal axis would not change, but the placement of datapoints along the vertical axis would.  Perhaps Kurzweil merely has to break out of US-centricity in order to strengthen his case and rebut most of his critics. 

The future will disclose the results to us soon enough.

(crossposted on TechSector)

Related :

Are You Acceleration Aware?

The Impact of Computing

These are the Best of Times

Nine Tantalizing Small Companies

In scouring the startup universe for the companies and technologies that can reshape human society and create entirely new industries, one has to play the role of a prospective Venture Capitalist, yet not be constrained by the need for a financial exit 3-6 years hence. 

Therefore, I have assembled a list of nine small companies, each with technologies that have the potential to create trillion-dollar economic disruptions by 2020, disruptions that most people have scarcely begun to imagine today.  Note that the emphasis is on the technologies rather than the companies themselves, as a startup requires much more than a revolutionary technology in order to prosper.  Management skills, team synergy, and execution efficiency are all equally important.  I predict that out of this list of nine companies, perhaps one or two will become titans, while the others will be acquired by larger companies for modest sums, enabling the technology to reach the market through the acquiring company. 

1) NanoSolar : NanoSolar produces low-cost solar cells that are manufactured by a process analogous to 'printing'.  The company's technology was selected by Popular Mechanics as the 'Innovation of the Year' for 2007, and Nanosolar's solar cells are significantly ahead of the Solar Energy Cost Curve.  The flexible, thin nature of Nanosolar's cells may enable them to be quickly incorporated onto the surfaces of many types of commercial buildings.  Nanosolar's first shipments have already occurred, and if we see several large deployments in the near future, this might just be the company that finally makes solar energy a mass-adopted consumer technology.  Nanosolar itself calls this the 'third wave' of solar power technology. 

2) Tesla Motors : I wrote about Tesla Motors in late 2006.  Tesla produces fully electric cars that can consume as little as 1 cent of electricity per mile.  They are about to deliver the first few hundred units of the $98,000 Tesla Roadster to customers, and while the Roadster is not a car that can be marketed to average consumers, Tesla intends to release a 4-door $50,000 sedan named 'WhiteStar' in 2010, and a $30,000 sedan by 2013.  The press coverage devoted to Tesla Motors has been impressive, but until the WhiteStar sedan successfully sells at least 10,000 units, Tesla will not have silenced critics who say the technology cannot be brought down to mass-market costs. 

3) Aptera Motors : When I first wrote about Tesla Motors, it was before I had heard about Aptera Motors.  While Tesla is aiming to produce a $30,000 sedan for 2013, Aptera already has an all-electric car due for late 2008 that is priced at just $27,000, while delivering the equivalent of between 200 and 330 mpg.  The fact that the vehicle has just three wheels may reduce mainstream appeal to some degree, but the futuristic appearance of the car will attract others.  Aptera Motors is a top candidate for winning the Automotive X-Prize in 2010. 

The simultaneous use of Nanosolar's solar panels with the all-electric cars from Tesla and Aptera may enable automotive driving to be powered by solar generated electricity for the average single-family household.  The combination of these two technologies would be the 'killer ap' of getting off of oil and onto fully renewable energy for cars. 

Related : Why I Want Oil to Hit $120/Barrel.

4) 23andMe : This company gets some press due to the fact that co-founder Anne Wojcicki is married to Sergey Brin, even as Google has poured $3.9M into 23andMe.  Aside from this, what 23andMe offers is an individual's personal genome for just $1000.  What a personal genome provides is a profile of which health conditions the customer is more or less susceptible to, and thus enables the customer to provide this information to his physician, and make the preventive lifestyle adjustments well in advance.  Proactive consumers will be able to extend their lifespans by systematically reducing their risks of ailments they are genetically predisposed to.  As the service is a function of computational power, the price of a personal genome will, of course, drop, and might become an integral part of the average person's medical records, as well as an expense that insurance covers. 

5) Desktop Factory : In 2008, Desktop Factory will begin to sell a $5000 device that functions as a 3-D printer, printing solid objects one layer at a time.  A user can scan almost any object (including a hand, foot, or head) and reproduce a miniature model of it (up to 5 X 5 X 5 inches).  The material used by the 3-D printer costs about $1 per cubic inch. 

The $5000 printer is a successor to similar $100,000 devices used in mechanical engineering and manufacturing firms.  Due to the Impact of Computing, consumer-targeted devices costing under $1000 will be available no later than 2014.  I envision an ecosystem where people invent their own objects (statuettes, toys, tools, etc.) and share the scanned templates of these objects on social networking sites like MySpace and Facebook.  People can thus 'share' actual objects over the Internet, through printing a downloaded template.  The cost of the printing material will drop over time as well.  A lot of fun is to be had, and expect an impressive array of brilliant ideas to come from people below the age of 16. 

6) Zazzle : Welcome to the age of the instapreneur.  Zazzle enables anyone to design their own consumer commodities like T-shirts, mugs, calendars, bumper stickers, etc. on demand.  If you have an idea, you can produce it on Zazzle with no start-up costs, and no inventory risks.  You profit even from the very first unit you sell, with no worries about breakeven thresholds.  You can produce an infinite number of products, limited only by your imagination.  At this point, those of you reading this are probably in the midst of an avalanche of ideas of products you would like to produce. 

While the bulk of Zazzle users today are would merely be vanity users who manage to sell under ten units of their creations, this new paradigm of low-cost customization will inevitably creep up to major industrial supply chains.  Even more interesting, think about #5 on this list, Desktop Factory, combining with Zazzle's application, into an amazing transformation of the very economics of manufacturing and mass-production. 

7) A123 Systems : Read here about how battery technology is finally set to advance after decades of stagnation.  A123 Systems is at the forefront of these advances, and has already received over $148 Million in private funding, as well as an article from the prestigious MIT Technology Review.  A123 is a supplier for GM's upcoming Volt, and has already has begun to sell a module to convert a Toyota Prius into a plug-in hybrid.  For choices beyond those offered by the #2 and #3 companies on this list, A123 Systems is poised to enable the creation of many new electric or plug-in hybrid vehicles, greatly increasing the the choices available to consumers seeking the equivalent of more than 50 mpg.  A123 may just become the Intel of batteries.  Combine A123's batteries with Nanosolar's cells, and the possibilities become even more interesting. 

8) Luxim : Brightness of light is measured in Lumens, not Watts, which is a measure of power consumption.  Consumers are learning that CFL and LED bulbs offer the same Lumens with just a fifth or a tenth of the Watts consumed by a traditional incandescent bulb, and billions of tons of coal are already being saved by the adoption of CFLs and LEDs.  Luxim, however, aims to take this even further.  Luxim makes tiny bulbs that deliver 8 times as many Lumens per Watt as incandescent bulbs.  The bulbs are too expensive for home use, but are already going into projection TVs.  With $61 Million in funding to date, Luxim's main hurdle will be to reduce the cost of their products enough to penetrate the vast home and office lighting market, which consumes tens of billions of bulbs each year.   

9) Ugobe : Ugobe sells a robotic dinosaur toy known as the Pleo.  A mere toy, especially a $350 toy, would not normally be on a list of technologies that promise to crease the fabric of human society.  However, a closer look at the Pleo reveals many impressive increments in the march to make inexpensive robots more lifelike.  The skin of the Pleo covers the joints, the Pleo has more advanced 'learning' abilities than $2500 robots from a few years ago, and the Pleo even cries when tortured, to the extent that it is difficult to watch this. 

The reason Ugobe is on this list is that I am curious to see what is the next product on their roadmap, so that I can gauge how quickly the technology is advancing.  The next logical step would be an artificial mammal of some sort, with greater intelligence and realistic fur.  The successful creation of this generation of robot would provide the datapoints to enable us to project the approximate arrival of future humanoid robots, for better or for worse.  Another company may leapfrog Ugobe in the meantime, but they are currently at the forefront of the race to create low-priced robotic toys. 

This concludes the list of nine companies that each could greatly alter our lives within the next several years.  Of these nine, at least three, Nanosolar, Tesla Motors, and 23andMe, have Google or Google's founders as investors.  The next 24 months have important milestones for each of these companies to cross (by which time I might have a new list of new companies).  For those that clear their respective near-term bars, there might just be a chance of attaining the dizzy heights that Google, Microsoft, or Intel has. 

Related :

The Impact of Computing

A Future Timeline for Automobiles

A Future Timeline for Energy

The Imminent Revolution in Lighting

Batteries Set to Advance, Finally

(crossposted on TechSector)

US Recession Began in December 2007

The US government usually declares a recession only several months after it has begun.  I find the Economic Cycle Research Institute to be a vastly more reliable source of leading indicators.  While the ECRI has still not declared a recession as 'unavoidable', the economic data of the last week tells me that it is, indeed, not just unavoidable at this point, but that it actually began in December 2007.  It is far too late for any 'stimulus' to prevent a recession, nor will the EU manage to avoid hardship of its own. 

When I identified the pervasive nature of the Housing Bubble way back on April 13, 2006, I stated that housing may do poorly in inflation-adjusted terms even for the next 20 years (until 2026).  Few were convinced then, now only somewhat more are.  But supporting data for my prediction of the housing bubble being an event of generational duration is accumulating steadily. 

Furthermore, when the US economy was not at any risk of recession on November 4, 2006, I wrote an extended piece to refute the broken clocks who always insist the US is on the brink of collapse.  I declared that if recession does not happen by the end of 2007, then the housing bubble will no longer be a cause of recession, due to the housing correction being lengthy (hence digestible) rather than sharp.  As the recession began in December 2007, we missed passing into the safety zone by just a hair. 

As the question of recession is now in the past, the next question is when a recovery may take place.  The drop in economic conditions between October and January was so steep, and the Federal Reserve's reduction in rates in January, while belated, was so large in magnitude, that GDP recovery may arrive as soon as Q4.  But I am not making a prediction on recovery timing yet. 

Update (3/20/08) : The ECRI has officially declared the economy to be in recession, six weeks after The Futurist. 

(Crossposted on TechSector).

Related :

The Housing Bubble - 20-Year Gains May Never be Repeated

The Futurist's Stock Portfolio for 2007 - RESULTS

On January 23, 2007, I created an investment portfolio to be frozen at that time, and evaluated on December 31, 2007 against the benchmark of the S&P500 index.  The portfolio incorporated principles, economic trends, and technologies discussed in other articles here on The Futurist.  Dividends were reinvested, and so the price paid reflects dividend-adjusted cost-basis.  Yahoo and Google Finance do tend to miss recording some dividends, so one must go to a more reliable site like Morningstar to account for the exact dividends. 

So how did the portfolio do?  I achieved a return of 13.3%, vs. just 4.3% for the S&P500, from January 23 to December 31.  Most fund managers are unable to beat the S&P500 index despite the advanced tools at their disposal.  The fraction of those that can beat the index by a margin 9.0 percentage points is even more exclusive, putting this portfolio in the top 10% of all mutual fund results for this period. 

 

As always, weightage matters just as much as stock-picking.  The first two securities, amounting to 50% of my portfolio, were a total disaster.  In fact, when I first created the portfolio, I listed FXI as a security that was strongly considered but left out.  FXI returned an eye-popping 83% over the same period, so if I had included FXI instead of ICF, the portfolio's total return would have exceeded 25%.  But it was not included, so 'what ifs' do not count. 

The India Investment Fund (IIF) was a star, more than compensating for the failure of the first two securities.  But the real home runs came from the video game stocks.  Three of the four outperformed the S&P500, and two of those, Activision and GameStop, surged into the stratosphere.  My selection and detailed analysis of this sector way back on April 17, 2006 yielded a spectacular payoff.  As a quartet, these 4 gaming stocks returned a combined 49% over this period. 

So there you have it.  Futurism is not impossible after all.  I have already started my 2008 portfolio, and we shall see how that goes on December 21, 2008.  The same principles covered in the articles below, are being applied.  Let us see if the success can be repeated or exceeded. 

The Next Big Thing in Entertainment, Part I, Part 2, and especially Part 3

The Culture of Success and Stock Market Capitalization in Developing Countries

The Stock Market is Exponentially Accelerating too

(cross-posted at TechSector)

2007 Technology Breakthrough Roundup

One year ago, I posted a roundup of 2006 technology breakthroughs from MIT Technology Review.  Of the breakthroughs listed at that time, displays, plug-in hybrids, and solar cells showed impressive progress over the subsequent 12 months. 

Now, we arrive at the 2007 list, which has expanded from four categories last year to five this time. 

The Year in Software

The Year in Hardware : Gadgetmania

The Year in Energy : Solar power inches closer.

The Year in Biotechnology : Stem cell research methods that no longer need embryos.

The Year in Nanotechnology : Stanford University research into nanowires that dramatically increase battery capacity is the most promising breakthrough of 2007, in any discipline.  Think 30-hour laptop batteries. 

Most of the innovations in the articles above are in the laboratory phase, which means that about half will never progress enough to make it to market, and those that do will take 5 to 15 years to directly affect the lives of average people (remember that the laboratory-to-market transition period itself continues to shorten in most fields).  But each one of these breakthroughs has world-changing potential, and that there are so many fields advancing simultaneously guarantees a massive new wave of improvement to human lives. 

This scorching pace of innovation is entirely predictable, however.  To internalize the true rate of technological progress, one merely needs to appreciate :

The Milli, Micro, Nano, Pico curves

The Impact of Computing

The Accelerating Rate of Change

We are fortunate to live in an age when a single calendar year will invariably yield multiple technological breakthroughs, the details of which are easily accessible to laypeople.  In the 18th century, entire decades would pass without any observable technological improvements, and people knew that their children would experience a lifestyle identical to their own.  Today, we know with certainty that our lives in 2008 will have slight but distinct and numerous improvements in technological usage over 2007, just as 2007 was an improvement over 2006. 

Into the Future we continue, where 2008 awaits..

(cross-posted at TechSector).

Hiatus

Dear Readers,

Due to a convergence of professional and personal responsibilities, I will not be posting any new articles between now and January 31 (except maybe a year-end roundup).  I will, however, be updating existing articles sporadically.  I also will be starting a different blog on a somewhat different subject, as well as working on updating the book manuscript that I had written up before starting The Futurist (from which many of the articles here are extracted). 

Thanks for your readership, and I will return in 11 weeks time.

GK

The Futurist's Stock Portfolio for 2008.

Early this year, I presented my 2007 portfolio, which will be evaluated on December 31, 2007, in relation to the performance of the S&P500 index. 

I am now going to present my 2008 portfolio, which is to be tracked over the remaining 13+ months between now and the end of 2008, again in relation to the S&P500 index.  The hypothetical portfolio of $100,000 will be invested in exchange-traded securities and mutual funds that reflect what I believe to be an optimal portfolio construction for 2007.  We will, at the end of the period, see how the portfolio tracks the broader market.  Dividends will be re-invested. 

So the portfolio is :

 

This is a simpler portfolio, with less emphasis on gaming, and more on fundamental value-based principles.  The selections represent general principles and specific predictions outlined in the previously written articles :

The Next Big Thing in Entertainment, Part I, Part 2, and especially Part 3

The Culture of Success and Stock Market Capitalization in Developing Countries

The Stock Market is Exponentially Accelerating too

I hereby sign and seal this portfolio, bought at the prices on November 9, 2007, to be evaluated on the last trading day before December 31, 2008. 

Bobby Jindal and the Future of Geopolitics

Bobby Jindal has become the new Governor of Louisiana.  In order to understand why is this important to anyone outside of Louisiana, consider the following points, in combination :

1) Bobby Jindal is only 36 years old, and has become one of the youngest ever Governors in US history.  Prior to this, he has served in the US House of Representatives, was a Rhodes Scholar, and was employed at McKinsey & Company.  His success in so many different areas reflects deep intelligence and competence, rather than just a fluke.

2) As Governor of a medium-sized state, he has gained an Executive Branch position, and thus has already accomplished more towards creating a Presidential resume than Barack Obama, 10 years his senior, has.  Barack Obama has just 4 years of Senate experience and no executive experience.  Note that no US President has been elected without Executive (either Governor or VP) experience in the last 11 elections since John F. Kennedy in 1960. 

3) That he could win so handily on a GOP ticket in Louisiana shows that whatever perceived disadvantages he may have had for being a Catholic, or for being non-white, were not barriers.  In other words, if he can win there, he can win over a majority of America. 

4) As by far the most prominent Indian-American in US politics, he has exclusivity in garnering political support from what is the highest-income ethnic group in the US.  This elevates the visibility of a dark-skinned group that has a higher average income than whites, and thus reduces self-limiting perceptions of imagined 'racism' that many minorities still hold.  This also grants the GOP a pathway to conduct a campaign to attract high-income, fiscally and socially conservative minorities, which the GOP presently does a shockingly poor job of. 

5) India is one of the most pro-US countries in the world, and is also a rare country that is more supportive of Republican politicians than America itself is (very few people know this).  Indo-US ties are the most rapidly widening economic and political ties between any two large countries in the world today, and with the Indian economy set to grow at 8-11% a year for the next 13 years, Indo-US trade will amount to as much as $400 Billion by 2020 (from $32 Billion in 2006, and just $5 Billion in 1990).  Bobby Jindal is already a household name in India, and thus is superbly positioned to maximize this imminent wave of Indo-US geopolitical alignment and economic integration. 

6) I repeat, he is only 36 years old.  How much had any of the big name politicians of our era accomplished at that age?  He has 20 years to go before he is even 56, and thus has ample time to lay the groundwork for multiple shots at the Presidency or Vice Presidency. 

However, there is still along way to go, and the path is strewn with many traps and pitfalls.  In order to advance to the highest echelon, Bobby Jindal has to work on the following three things :

1) Oversee the reconstruction and recovery of New Orleans into a city that is better than it ever was before.  This is a monumental challenge, but success here will immediately receive nationwide applause.  This is the accomplishment that he could ride to the Presidency. 

2) Honing his speaking skills.  While a competent speaker, he is not as electrifying at the big occasion as Barack Obama is, and this does matter immensely.  This is a learnable skill, however, that almost anyone can gain through diligent practice. 

3) Stay as scandal-free as possible over a very long period.  One scandal can derail higher political ambitions permanently. 

When Bobby Jindal rises to national prominence as a Presidential candidate at some point between 2016 and 2036, remember what you read here on The Futurist in October of 2007, and observe how a unique convergence of multiple megatrends elevated an unlikely man to the greatest heights of political power. 

Why I Want Oil to Hit $120 per Barrel

Here on The Futurist, we have a long tradition of seeking permanent independence from oil-drunk dictatorships and theocracies, with the pursuit of long-term gains taking precendence over the avoidance of short-term pain.  I refer you to :

Why $70/barrel Oil is Good for America (February 1, 2006).

$70+/Barrel Oil, the Non-Crisis (April 25, 2006).

Terrorism, Oil, Globalization, and the Impact of Computing (August 22, 2006).

When oil first hit $70/barrel nearly two years ago, there were widespread fears of the US economy tipping into recession.  I pointed out that a much smaller piece of the US economy has exposure to oil than was the case in 1974 or 1981, which were the last times such high prices were seen (in inflation-adjusted terms).  Google, Oracle, and VMWare are far less vulnerable to oil prices than General Motors and Federal Express.  Sure enough, after 2 years of oil prices hovering around $70, the US economy has successfully adapted to it.  The specter of the $70 barrier is behind us, permanently.  This chart from the Bureau of Labor Statistics shows the annualized rate of oil price inflation over the last few years. 

Notice how the rise from $20 to $80 led to import price inflation (the blue line) touching 10% for three years.  However, that rise is now behind us, with the settled price of $70/barrel or more no longer causing further inflation in the price of imported products.  Even more striking is the shrinkage in the US trade deficit.  Despite oil imports being as much as one third of the US trade deficit of about $60 Billion/month, the trade deficit has actually shrunk since the peak of 2006, contributing positively to GDP growth for the first time in over a decade (chart from BusinessWeek).  That the US economy can now take $70 and even $80 oil in stride is the biggest story that no one has noticed yet. 

However, $70 oil also fattens the coffers of the world's notorious 'Petrotyrants'.  From Iran to Venezuela to Saudi Arabia to Russia, one can note that there is a rather close corelation between an economy being heavily dependent on oil exports and the leaders of that country resisting or even rescinding democracy. 

Thomas Friedman has many interesting articles on the subject, such as his 'Fill 'Er Up With Dictators' :

But as oil has moved to $60 to $70 a barrel, it has fostered a counterwave — a wave of authoritarian leaders who are not only able to ensconce themselves in power because of huge oil profits but also to use their oil wealth to poison the global system — to get it to look the other way at genocide, or ignore an Iranian leader who says from one side of his mouth that the Holocaust is a myth and from the other that Iran would never dream of developing nuclear weapons, or to indulge a buffoon like Chávez, who uses Venezuela’s oil riches to try to sway democratic elections in Latin America and promote an economic populism that will eventually lead his country into a ditch.

But Mr. Friedman is a bit self-contradictory on which outcome he wants, as evidenced across his New York Times columns.

Over here, he says :

In short, the best tool we have for curbing Iran’s influence is not containment or engagement, but getting the price of oil down

And here, he says :

So here’s my prediction: You tell me the price of oil, and I’ll tell you what kind of Russia you’ll have. If the price stays at $60 a barrel, it’s going to be more like Venezuela, because its leaders will have plenty of money to indulge their worst instincts, with too few checks and balances. If the price falls to $30, it will be more like Norway. If the price falls to $15 a barrel, it could become more like America

Yet over here he says :

Either tax gasoline by another 50 cents to $1 a gallon at the pump, or set a $50 floor price per barrel of oil sold in America. Once energy entrepreneurs know they will never again be undercut by cheap oil, you’ll see an explosion of innovation in alternatives.

As well as over here :

And by not setting a hard floor price for oil to promote alternative energy, we are only helping to subsidize bad governance by Arab leaders toward their people and bad behavior by Americans toward the climate.

All of these articles were written within a 4-month period in early 2007.  Both philosophies are true by themselves, but they are mutually exclusive.  Mr. Friedman, what do you want?  Higher oil prices or lower oil prices?

But forget about Mr. Friedman wanting it both ways.  Instead, I am going to go with the second choice, that of higher oil prices.  I see this as a golden opportunity for permanent, far-reaching, multifaceted geopolitical change.  The US economy has successfully adapted to a permanent $70/barrel oil price with almost no real pain, and thus it is the time to take the bull by the horns, and lure the Petrotyrants into the ultimate irreversible trap. 

It is time to hope that the price of oil rises to $120/barrel by 2010, and stays above that level permanently. 

Why, you may ask?  Won't such a high price make Iran, Venezuela, Saudi Arabia, Russia, Nigeria, Sudan, Kazakhstan, and others even wealthier, without them having done anything to earn it?  Won't it make Sudan more genocidal, and Iran more able to equip terrorists?  Won't Saudi Arabia be able to fund even more Madrasas across the world? 

Sure it will, for a time.  But consider the perils of burning the candle at both ends.

But won't this also cause economic suffering in the US?  For a time, yes.  Gasoline will be at $5/gallon, and the trade deficit will temporarily widen.  I claim the possible recession will be brief, if there even is one at all, as the run-up from the present price of $80/barrel up to $120/barrel is already less of a shock than the jump from $20 to $80 that we already have successfully sustained.  I say all of this is worthwhile short-term pain, for when the quietly toiling engine of technological innovation emerges from its chrysalis, it will be gigantic. 

The technological climate of 2007 is very different from that of 1974 or 1981.  There is so much breadth and depth in energy innovation right now, even at the present $70-$80/barrel, that $120/barrel will move the technology and economics of alternative energy into fast-forward.  Currently, the petroleum market is shielded from exposure to both the electricity market and the agricultural market.  However, upcoming electric and plug-in hybrid automobile technologies consume electricity at an equivalent cost of just $1/gallon.  Furthermore, electricity can be generated from multiple sources that exist in almost every country, eliminating the weak position that oil importers are in relative to oil exporting nations.  With gasoline at $5/gallon, consumers will migrate towards hybrids, plug-in hybrids, and electric vehicles so rapidly that the auto manufacturers will start engaging in aggressive competition to lower prices and accelerate innovation.  This will greatly widen the fronts at which the oil market is exposed to the far cheaper and decentralized electricity market.  This spells trouble for oil producers who have to compete with electricity that is 3-5X cheaper in providing the same transportation. 

Simultaneously, cellulostic and algae-derived ethanol research efforts will get supercharged, greatly increasing the probability of a breakthrough that enables the attractive math of cellulose or algae to replace the unimpressive economics of corn ethanol.  If ethanol from switchgrass or algae is more compelling than oil at $120/barrel, oil has yet another enemy in addition to electricity.  The combination of electric vehicle and cellulose/algae ethanol technologies will act as a 1-2 punch to slash the consumption of oil across both the US and China permanently within just a few short years. 

Then, the fun begins.  The terrorists and despots who got lured into profligate spending under $120 oil will eventually find that the demand for their exports is plummeting.  Furthermore, the thing about subsidies such as those that Iran doles out is that they are self-propagating.  Note that in 2005, Iran exported $44 billion in oil, but spent $25 billion in subsidies, meaning that if oil fell to $30/barrel, Iran's export revenue would effectively become zero if the same level of subsidies are maintained.  34 cent/gallon gasoline leads to more car purchases and hence more demand for gasoline, increasing the cost of maintaining the subsidies, and hence the oil price floor at which Iran's export revenues would shrink to zero.  At $120/barrel, the subsidy obligation will be so burdensome that even a drop back down to $70/barrel would lead to a revenue falling behind expenses.  At the same time, China will have no choice but to aid in the hastening of these technological advances, as they will have to shift their priorities from locking up oil contracts to reducing the crushing cost of oil imports at $120/barrel. 

On the other hand, if oil stays at or below $70/barrel for the long term, Petrotyrants will survive to continue their nefarious activities for at least another 20 years to come.  China, too, will continue their current stance of propping up Petrotyrants. 

Thus, I say bring $120 on.  We outspent the Soviet Union on defense, and we can outspend the Petrotyrants while setting them up for an inevitable cornering and collapse.  Give me $120/barrel oil by 2010, and I will give you the demise of Petrotyranny in Russia, Iran, and Venezuela by 2015.  Count on it. 

Update (10/19/07) : We're up to $90/barrel already!  While there will be ups and downs in the traded daily price, and the gloomy media coverage might appear frightening, be patient and disciplined.  The short-term pain will lead to permanent long-term gain. 

Update (5/22/08) : Oil has crossed $120/barrel, and is currently as high as $133.  Such a rapid rise usually is followed by a precipitous drop, and we need the price to stay above $120 for an extended period to realize the benefits described in the article.  I might do a v 2.0 in 2008 itself if the price stays high. 

Related :

A Future Timeline for Automobiles

A Future Timeline for Energy

Terrorism, Oil, Globalization, and the Impact of Computing

 

 

 

 

 

 

Victory in Iraq in 2008 : A Half-Time Update

One of the three most widely-read articles ever written on The Futurist has been my prediction, dated May 10, 2006.  It was an article titled "We Will Decisively Win in Iraq....in 2008, Part I" and "Part II". 

At the moment, we are 16 months from the prediction, yet another 15 months before the end of 2008.  Given that this is about the halfway point between the date of the prediction and end date, and that the report from General Petraeus was released earlier this month, it is the right time to see how well the original prediction is tracking. 

So let us start with the three components of defining what 'victory' would look like : a growing Iraqi economy, contained levels of violence, and sustained Iraqi governmental control over the entire country.  This is the loose definition of what victory would be.

To be clear, victory does NOT mean that US troops will vacate Iraq.  The US has had troops in Germany and Japan for 62 years, in South Korea for 54 years, in Bosnia for 10 years, and Afghanistan for 6 years.  None of those countries want us to leave, on account of all the free security and money they receive from our presence.  Iraq will be no exception.  Nor does victory mean US troop casualties have to be zero.  That, too, is not the case in many other foreign locations we are in.  Lastly, victory does not mean that there will magically be no violence between Shias and Sunnis for the first time in 1350 years.  It just means they will compromise enough for the government to function.

Back to the three metrics of victory, let us begin with the first.  The centerpiece of my initial prediction was Iraq's economic growth.  How is Iraq's economy faring?

GDP statistics for Iraq are notoriously hard to come by.  The Brookings Report has revised GDP numbers several times, and it appears that the year-ago projections for double-digit GDP growth have been knocked down to lower rates.  But this is still growth in the Iraqi economy.  Furthermore, the Iraqi Stock Exchange has continued to do well in 2007.  Another piece of my prediction relies on the proliferation of information and communications access, as measured by telephone and Internet penetration.  This is important because when the majority of people in a society have access to a wide variety of information, it is much harder to oppress them and suppress the urges of freedom.  As per the Brookings Report, both have grown nicely in the past 12 months.  It is true that electricity in Iraq is spotty, but this is only because the demand is skyrocketing.  Stable democracies like India also have electricity rationing and frequent blackouts because of rapidly rising demand.  The final piece of Iraqi prosperity is measured by the Human Development Index.  The UN does not calculate this index for Iraq, but their GDP per capita and other factors lead to an estimated HDI of about 0.660, which compares nicedly to many other Arab nations and Asian nations.  Overall, I will rate the Iraqi economy as trending positively.

Violence is the next metric to measure.  First, we will start with the Petraeus report, and the success of the Surge in general.  Remarkably, prominent Democrats like Senators Carl Levin and Dick Durbin have openly praised the progress being made, and the dramatic transformation of Al-Anbar province from an Al-Qaeda haven to an eager participant in Iraq's new democracy is nothing short of astonishing.  The public has caught on as well.  Support for both the war and the surge, while still low, has edged up 7-10 points just over the last few months.  More now say the war is winnable than at any time in the last 3 years.  Even the center-left British magazine The Economist makes the case for continued US presence.  While the death rate for US and Iraqi troops has fluctuated greatly from one month to the next, the trendline has not solidly dropped in the last 12 months. The number of terrorist attacks throughout Iraq has certainly abated, however, as have general casualties.  The 'Surge' under General Petraeus has led to many first and second tier terrorists meeting their demise.  However, my initial condition of all of Iraq become safe enough for tourism will clearly not be met in the near future, although the Kurdish areas are already safe and stable enough for a Vegas-style casino to open.  Overall, I will rate this metric as trending slightly positive. 

The third metric to measure is the level of control the Iraqi government and military are able to exert over the rest of the country.  Most Americans' dissatisfaction with prolonging US presence stems from the inability of the Iraqi government to make progress towards less dependence on US support.  A sustained Shia-Sunni cooperation remains elusive.  At the same time, the number of provinces that have been handed over to full Iraqi control continues to rise at a steady rate, and the problematic areas, particularly after the turn-around of Anbar province, are steadily shrinking in proportion to the stable areas.  I will rate this metric as trending neutral to slightly positive.   

Thus, by combining these three metrics, the verdict is that Iraq is trending in a moderately positive direction.  This is due to two key factors - the success of the 'Surge' under General Petraeus, and the rapid diffusion of technology enabling the Iraqi economy to still grow despite the challenging environment. 

Now, the anti-American fifth-column (8-10% of the US population) will try as hard as it can to downplay positive events and manufacture negative fiction.  It is revealing to note that Osama bin Laden's latest tape, authentic or not, babbles about 'global warming' and 'subprime mortgages', indicating the near-complete ideological convergence between anti-US fifth-columnists and Al-Qaeda.  Thus, both Al-Qaeda and fifth-columnists know that victory in Iraq would be an unacceptable setback to their joint cause. 

Given that some prominent Democrats now openly praising the progress under General Petraeus, the fifth-column pressure groups have turned the cross-hairs onto these Democrats.  The 'Betray Us' ad from an anti-US group that was printed in the New York Times was condemned by 23 Democrats, while also approved by 25.  The same ad was condemned by the public by a 58%/23% margin.  This even split is symbolic of the upcoming civil war within the Democratic Party, where on one side reside those Democrats who are pro-US enough to stand up to anti-US pressure groups, while on the other side reside those who are too dependent on such groups to risk displeasing them.  This civil war will play out over the next several years, with Iraq used as the core topic in determining allegiances between the two factions. 

Thus, at this half-way point, I am re-affirming my prediction that we will, despite many uncertainties, see victory in Iraq by 2008.  The biggest challenge will be convincing enough people that it is indeed a victory as per the measures above, rather than actually achieving them.

Michael Yon's photo essay is another must-read. 

Be patient - we are almost there.

Investor's Business Daily comments on the progress of the Surge.

The bogus Lancet study, which claimed Iraqi deaths to be over 10 times higher than they actually were, has been exposed as a possible case of outright fraud. 

Here is a YouTube video on how to ferret out accurate information on the progress in Iraq. 

BusinessWeek Slideshow : 10 Green Technologies That Could Change Your Life

View BusinessWeek' slideshow over here.  I must point out that my Future Timeline for Energy, written back on February 25, 2007, has described many of the items that BusinessWeek noticed some 7 months later.  In fact, the following articles go back even earlier :

CFLs and LEDs : September 25, 2006

Tesla Roadster : December 26, 2006

This is not the first time an article here on The Futurist was written months before BusinessWeek featured the same technology.  My article Terrorism, Oil, Globalization, and the Impact of Computing, from August 22, 2006, predated a BusinessWeek slideshow on the same topic released on February 20, 2007, or 6 months later.  View the slideshow here.

The Way Is Hsut

This has nothing to do with futurism, but I could not resist joining the contest being held at Beltway Blogroll - a frenzy in creating puns applicable to fraudster Norman Hsu.

I recall a scene in Lord of the Rings, the Return of the King, where Aragorn, Legolas, and Gimli go into the Paths of the Dead, and meet the King of the Dead, who, as the Army of the Dead surrounds the heroes, chants, "The Way is Shut".

The same applies for the accomplices and beneficiaries of the previously elusive scam artist Norman Hsu.  Regarding those who were accustomed to receiving these ill-gotten funds, The Way is Hsut, and it can't be a positive development for Hillary Clinton's campaign.  Hsu himself skipped his court date to flee, but managed to stay on the lam for just two days, after which his fugitive path to freedom was hsut as well.  He forfeited the $2 million he posted as bail, which is the minimum that he deserves.

I am tempted to expand on something along the lines of "Blue Suede Hsus" or "Hsu Hsu Sudeo", but I'll leave that to the more skilled comics.

Update : However, I can't let the "My...preHsuous" opportunity go by. 

VMWare and the Next Silicon Valley Wealth Cycle

When Google conducted an IPO in August of 2004, it was the first multibillion-dollar offering for a Silicon Valley company after the deep recession of 2001-03.  Google achieved a market capitalization of over $20 billion on the first day, and several hundred employees became millionaires.  The infusion of new money into Silicon Valley was a major factor in shaking off the final stages of the preceding bust.  Today, Google's market cap stands at over $160 billion. 

Now, almost exactly 3 years later, another company called VMWare (VMW) has had an IPO, achieving a market capitalization of $23 billion, bringing overnight riches to many employees.  Amazingly, VMWare was acquired by EMC for just $635 Million in December of 2003.  That means the valuation of the company has risen about about 36X in just over 3.5 years, in a sector of technology that very few people are familiar with. 

VMWare's business is entirely different from Google's, but its effect on Silicon Valley will be similar.  An infusion of billions of dollars of cash into the ecosystem causes tremors in the tectonic plates of the Valley.  The event refills venture capitalist coffers which, in turn, fertilizes the Valley to grow thick with another wave of startups.  The cycle thus begins anew. 

Without fail, major liquidity events like this have occurred after intervals no longer than 4 years, even if there is a steep downturn in between (as in 2001-03).  There have been other, smaller IPOs in recent months, such as Cavium Networks (CAVM), Aruba Networks (ARUN), and Infinera (INFN), each weighing in at between $1.1 and $1.5 Billion.  The next cycle has begun in earnest.  Let's see where it takes us. 

Film-Quality Animation on the Average PC

I happened to see this story on MIT Technology Review :

Now, Adobe Systems, the company famous for tools like Photoshop and Acrobat Reader, is developing software that could bring the power of a Hollywood animation studio to the average computer and let users render high-quality graphics in real time. Such software could be useful for displaying ever-more-realistic computer games on PCs and for allowing the average computer user to design complex and lifelike animations.

The Impact of Computing mandates that any computationally driven product or capability exponentially drops in cost by 30% to 60% every year.  Each film that was considered to be a breakthrough in computer-derived special effects, from Toy Story to the Lord of the Rings Trilogy, used technology that continues to become commoditized.  What was groundbreaking from Pixar in 1995 is today affordable to second-tier video game companies designing games on $2 million budgets, and television programs intended for syndication and cable.  Before long, the prices inevitably reach the consumer. 

Needless to say, this greatly enhances the reach of the nascent cottage industry of Machinima, and eventually will lead to small groups of 2-3 people producing full-length animated feature films that can be distributed on the Internet.  I have written about this in detail in my article from 4/1/2006, The Next Big Thing in Entertainment, particularly in Part II.  This development from Adobe is one of the necessary steps towards realizing the vision that I outlined in the original article.  Machinima will be to Hollywood what the blogosphere became to Big Media. 

Related :

The Next Big Thing in Entertainment

The Technological Progression of Video Games

The Impact of Computing

Next Generation Graphics - A Good Intro

The Top Ten Transhumanist Technologies

The Lifeboat Foundation has a special report detailing their view of the top ten transhumanist technologies that have some probability of 25 to 30-year availability.  Transhumanism is a movement devoted to using technologies to transcend biology and enhance human capabilities. 

I am going to list out each of the ten technologies described in the report, provide my own assessment of high, medium, or low probability or mass-market availability by a given time horizon, and link to prior articles written on The Futurist about the subject.

10. Cryonics : 2025 - Low, 2050 - Moderate

I can see the value in someone who is severely maimed or crippled opting to freeze themselves until better technologies become available for full restoration.  But outside of that, the problem with cryonics is that very few young people will opt to risk missing their present lives to go into freezing, and elderly people can only benefit after revival when or if age-reversal technologies become available.  Since going into cryonic freezing requires someone else to decide when to revive you, and any cryonic 'will' may not anticipate numerous future variables that could complicate execution of your instructions, this is a bit too risky, even if it were possible.

9. Virtual Reality : 2012 - Moderate, 2020 - High

The Technological Progression of Video Games

The Next Big Thing in Entertainment, Part I, II, and III

The Mainstreaming of Virtual Reality

8. Gene Therapy : 2015 - Moderate, 2025 - High

The good news here is that gene sequencing techniques continue to become faster due to the computers used in the process themselves benefiting from Moore's Law.  In the late 1980s, it was thought that the human genome would take decades to sequence.  It ended up taking only years by the late 1990s, and today, would take only months.  Soon, it will be cost-effective for every middle-class person to get their own personal genome sequenced, and get customized medicines made just for them. 

Are you Prepared to Live to 100?

7. Space Colonization : 2025 - Low, 2050 - Moderate

While this is a staple premise of most science fiction, I do not think that space colonization may ever take the form that is popularly imagined.  Technology #2 on this list, mind uploading, and technology #5, self-replicating robots, will probably appear sooner than any capability to build cities on Mars.  Thus, a large spaceship and human crew becomes far less efficient than entire human minds loaded into tiny or even microscopic robots that can self-replicate.  A human body may never visit another star system, but copies of human minds could very well do so.

Nonetheless, if other transhumanist technologies do not happen, advances in transportation speed may enable space exploration in upcoming centuries.

6. Cybernetics : 2015 - High

Artificial limbs, ears, and organs are already available, and continue to improve.  Artificial and enhanced muscle, skin, and eyes are not far. 

5. Autonomous Self-Replicating Robots : 2030 - Moderate

This is a technology that is frightening, due to the ease at which humans could be quickly driven to extinction through a malfunction that replicates rouge robots.  Assuming a disaster does not occur, this is the most practical means of space exploration and colonization, particular if the robots contain uploads of human minds, as per #2.

4. Molecular Manufacturing : 2020 - Moderate, 2030 - High

This is entirely predictable through the Milli, Micro, Nano, Pico curves. 

3. Megascale Engineering (in space) : 2040 - Moderate

From the Great Wall of China in ancient times to Dubai's Palm Islands today, man-made structures are already visible from space.  But to achieve transhumanism, the same must be done in space.  Eventually, elevators extending hundreds of miles into space, space stations much larger than the current ISS (240 feet), and vast orbital solar reflectors will be built.  But, as stated in item #7, I don't think true megascale projects (over 1000 km in width) will happen before other transhumanist technologies render the need for them obsolete.

2. Mind Uploading : 2050 - Moderate

This is what I believe to be the most important technology on this list.  Today, when a person's hardware dies, their software in the form of their thoughts, memories, and humor, necessarily must also die.  This is impractical in a world where software files in the form of video, music, spreadsheets, documents, etc. can be copied to an indefinite number of hardware objects. 

If human thoughts can reside on a substrate other than human brain matter, then the 'files' can be backed up.  That is all there is to it. 

1. Artificial General Intelligence : 2050 - Moderate

This is too vast of a subject to discuss here.  Some evidence of progress appears in unexpected places, such as when, in 1997, IBM's Deep Blue defeated Gary Kasparov in a chess game.  Ray Kurzweil believes that an artificial intelligence will pass the Turing Test (a bellwether test of AI) by 2029.  We will have to wait and see, but expect the unexpected, when you least expect it. 

Solar Energy Cost Curve

Forbes has a whole feature on Solar Energy this week.  Within, I found a chart that I have been seeking for a long time - a chart tracking the declining cost of electricity generated by photovoltaic surfaces. 

It appears that cost parity with present residential electricity rates is finally imminent.  Also, migration to solar power could happen rapidly before full cost parity due to tax breaks, and the fact that solar energy is generated at the time of day when electricity rates are already the highest. 

For reference, below is a chart of US solar intensity.  It is quite possible that by 2020, many homes in the southern US will have photovoltaic surfaces on their rooftops.  This, combined with the spread of plug-in hybrids and fully electric vehicles (including those from Tesla motors, which come with their own included solar panel), will lead to a fascinating simultaneous shift from a portion of coal consumption to renewables (solar, wind), and from a portion of petroleum consumption to electricity.  So solar would indirectly eat into a small slice of oil consumption.

Related :

A Future Timeline for Energy

Pakistan on the Precipice

As long-time readers know, this weblog has an optimistic outlook on most aspects of our future.  However, there is one particular topic on which I have not yet written, even though I read every available article on the subject.  It is a topic on which I can't assign a sizable probability to any positive outcome.  It is the topic of Pakistan and it's nuclear weapons. 

Pakistan is a country that did not exist until 1947, when it was carved out of British India at the time of Indian Independence.  There were two non-contiguous pieces of Pakistan on either side of India, and East Pakistan separated to become Bangladesh in 1971, after a genocide in East Pakistan killed 1.5 million people (from Wikipedia).   

Today, the remaining nation of Pakistan still has 160 million people, the political boundaries of which still do not corelate to any particular ethnic homogeniety.  In a nutshell, the massive Indus river flows through the middle of the country, to the east of which reside Punjabi and Sindhi groups, which are quite Indian-like in appearance, language, cuisine, and culture, and to the west of which are found Pashtuns and other groups with a distinctly Turkic and Persian culture and appearance.  The Indus river has historically been the natural boundary between Indian and Turco-Persian civilizations for over 2000 years, and evidence of this is visible in Pakistan to this day (image from Wikipedia). 

The 'Indian-like' part of Pakistan amounts to 75% of Pakistan's population, and is experiencing economic growth approaching that of India itself, at 6% to 7% a year.  Globalization is rapidly lifting people out of poverty for the first time.  Despite this, however, Pakistan remains one of the poorest countries outside of Africa, and also a country where democracy is distant, unlike in neighboring India. 

But this 75% of Pakistan is secondary.  The most crucial region is actually the most remote, most medieval, most undeveloped segment of Pakistan, where under 10% of the population resides.  It is the Northwest Frontier Province and Waziristan, where Pakistan's government has never had total control, and where local tribal customs were the only recognized law.  Until the Taliban and Al-Qaeda came to town. 

Now, to grasp the magnitude of the potential horror, consider the following three facts :

1)  Pakistan has 30-50 nuclear weapons.  Whether this technology was delivered directly by China or through North Korea in the 1990s is moot at this point.

2)  Al-Qaeda and the Taliban now control many districts of Northern Pakistan, with Ayman al-Zawahiri and Osama bin Laden (if still alive) also residing there.  Pakistan's army and government have little power to expel Al-Qaeda and the Taliban, and they continually attempt to assassinate President Pervez Musharraf. 

3)  The founder of Pakistan's nuclear program, Abdul Qadeer Khan, was found to be selling nuclear secrets in the black market.  His customer list is still unknown, and there may have been, or still be, others like him.

I can't see how the combination of these 3 facts can result in anything other than the detonation of a nuclear weapon in an act of terrorism against a major US or European city, between now and 2020.  Can anyone say with confidence that the probability of this is low?

Pakistan has already had nuclear weapons for 9 or more years, so why is the risk greater now?  This brings us back to point 2), and to understand the ominous trend of the Taliban gaining control over a greater and greater share of Pakistan, read some of Bill Roggio's articles.  In particular, this map tracks the rate of advancement of the Taliban's control, and distinctly shows them to be metastasizing deeply into Pakistan at an alarming rate. 

President Musharraf is nominally an ally of the US in the War on Terror, to the extent that he cracks down on terrorists when US demands to do so reach a certain intensity.  But this secular dictator is the thinnest of buffers between the current state and a nightmare scenario.  If Musharraf is assassinated and theocratic rule prevails in Pakistan, it would be far worse than the 1979 events in Iran.  Whatever remaining chance there is for terrorists being prevented from gaining access to nuclear weapons (if it is already not too late) resides with President Musharraf, or a similarly secular successor, remaining in power. 

If the Taliban do come into power, the options are few.  While a simple invasion by the US, India, and NATO would dispose of the Taliban quickly, it may not prevent them from retaining and smuggling out the nuclear weapon capabilities.  While most Punjabi and Sindhi Pakistanis have no desire to be ruled by the Taliban, they may not be able to throw off the yoke of subjugation even through a massive civil war (again, with the nuclear technology easily walking off). 

Be afraid.  Be very afraid. 

A Hornet-sized Robotic Insect Can Now Fly

A robotic insect, similar in size and weight to a wasp or hornet, has successfully taken flight at Harvard University (article and photo at MIT Technology Review).  This is an amazing breakthrough, because just a couple of years ago, such robots were pigeon-sized, and thus far less useful for detailed military and police surveillance. 

At the moment, the flight path is still only vertical, and the power source is external. Further advances in the carbon polymer materials used in this robot will reduce weight further, enabling greater flight capabilities.  Additional robotics advances will reduce size down to housefly or even mosquito dimensions.  Technological improvements in batteries will provide on-board power with enough flight time to be useful.  All of this will take 5-8 years to accomplish.  After that, it may take another 3 years to achieve the capabilities for mass-production.  Even then, the price may be greater than $10,000 per units.

Needless to say, by 2017-2020, this may be a very important military technology, where thousands of such insects are released across a country or region known to contain terrorists.  They could land on branches, light fixtures, and window panes, sending information to one another as well as to military intelligence.  Further into the future, if these are ever available for private use, than that could become quite complicated.

Four Headlines on Iraq

Look at this screenshot from the Yahoo front page, where four simultaneous headlines speak volumes about which groups seek which outcomes in Iraq.

The first is "Iraq warns against early US withdrawal", which makes sense, given that there will be a massive civil war in the event of a US withdrawal, leading to the possibility of a genocide greater than the one that resulted from the US withdrawal from Vietnam in 1973. 

The second states that Barack Obama, who aspires to become President of the United States, believes preventing genocide is not enough of a reason to remain in Iraq. 

The third headline is about Kosovo, which is unrelated to Iraq, except that it is a country that a Democratic President sent troops to in order to prevent ethnic cleansing, and where we still have troops after 10 years.

The fourth headline is similar to the first, except that it is US generals pleading for more time in Iraq, than the Iraqis themselves.  Thus, the US generals and Iraqi government appear to both want the US to maintain troops for longer. 

Whether the loss of 80 US troops a month for the next 12, 24, or 120 months in order to prevent the death of 2-3 million Iraqis is an acceptable exchange or otherwise is an individual decision, and perhaps not an easy one. 

Rather, the following points reveal themselves through each of the headlines :

1) Obama would not have said what he did if it were not an opinion held by a sizable percentage of Americans, perhaps even a majority.  I would agree that it is not America's job to sacrifice our own troops to prevent uncivilized cultures from defaulting to their traditional behaviors.  More than that, though, the fact that he is suggesting exactly the opposite of what both the Iraqi government and US generals want should be noted.  Thus, the hidden message here is that war supporters must articulate that the prevention of genocide is not the only reason to remain in Iraq, and that there are reasons to continue that are beneficial to American interests.  Obama has just given war supporters a clue on how to focus their words to make their case. 

2) Why do we still have troops in Kosovo after 10 years?  Or in Germany and Japan for 62 years and South Korea for 54 years.  Granted, they are not involved in active combat, but should we not withdraw troops first from where they have been the longest?  Those advocating withdrawal should have very detailed answers to this question.

3) Where are those who say we should "listen to the generals"?  Why not listen to them now?  What, exactly, determines when a general's opinion matters and when it does not?

Nonetheless, as predicted in May 2006, victory in Iraq is on track to be achieved in 2008.  I won't repeat points I have made before, except provide an update that the quantifiable metrics are continuing to trend favorably, and that is what supercedes all else in laying the foundations to shape the long-term judgment of history.

Economic Growth is Exponential and Accelerating, v2.0

If we were to make a list of subjects ranked by the gap between the civilizational importance of the topic and the lack of serious literature devoted to it, historical acceleration of economic growth would be very near the top of the list.  I wrote an article on the subject way back on January 29, 2006 (version 1.0), but now it is time for a much more substantial treatise. 

To whet your appetite, read the article "Are You Acceleration Aware?", which is the critical piece of any attempt at Futurism.

In the modern age, we take for granted that the US will grow at 3.5% a year, and that the world economy grows at 4% to 4.5% a year.  However, these are numbers that were unheard of in the 19th century, during which World GDP grew under 2% a year.  Prior to the 19th century, annual World GDP growth was so little that changes from one generation to the next were virtually zero.  Brad Delong has some data on World GDP from prehistoric times until 2000 AD. 

If I put historical per-capita GDP through 2000 in a logarithmic timescale, we see the following :

The theme of acceleration readily presents itself here, and even disruptive events like the Greagt Depression still do not cause more than a temporary deviation from the long-term trendline.  A different representation of the data would be to notice the shrinking intervals that it takes for per-capita World GDP to double.

10000 BC to 1500 : 11500 years without doubling

1500 to 1830 : 330 years

1830 to 1880 : 50 years

1880 to 1915 : 35 years

1915 to 1951 : 36 years (Great Depression and World Wars in this period)

1951 to 1975 : 24 years (recovery to trendline)

1975 to 2003 : 28 years

2003 to 2024-2027? : 21-24 years (on current trends)

This not only further reveals acceleration, but also indicates that massively disruptive world events still result in merely temporary deviations from the long-term trendline. 

Additionally, we can take the more granular IMF data of recent World GDP growth, and plot a trendline on it.  Both nominal and PPP growth rates are available, and are diverging due to the increasing size and growth rates of India and China.  Unfortunately, the IMF data only goes back to 1980, and 28 years are not enough to plot an ideal trendline, but nonetheless, the upward slope is distinct, and recessions (which still do not push World GDP growth into negative territory) are invariably followed by steep recoveries. 

It is also important to note that the standard deviation of the IMF data for World GDP growth rates is about 1% a year, for both the nominal and PPP series (1.07% and 1.14% respectively, to be exact).  The rules of standard deviations dictate that 68% of the time, a data point will be within one standard deviation of the mean, 95% will be between two standard deviations, and 99.7% will be within three. 

Thus, in a simple example, if the World GDP growth trendline is currently at 4% a year, there is a 68% chance that the next year will be between 3% and 5%, and there is only a 0.3% chance that the next year will be below 1% or above 7% growth.  This means that a worldwide recession with a year of negative growth is extremely improbable, just as improbable as a year with stupendous 8% growth.  There is not a single year in the 1980-2007 IMF data with negative GDP growth, and virtually none under 1% growth. 

Pessimists like to say that "the Great Depression will happen again", but not only was the Great Depression at a time when the trendline was at a lower annual growth rate than today, but the Great Depression comprised of 6 years of GDP falling below the trendline, simply because it followed a period of many years where GDP was substantially above the trendline.  Furthermore, this was for US GDP.  World GDP's deviations may have been even less severe, as some nations, such as France, Japan, and China, were left relatively unscathed by the Great Depression. 

Now, what happens if we project these trendlines through the 21st century?   The dotted red line represents the median trend assuming that nominal and PPP growth rates converge at some intermediate level. 

 

I can apply this trendline for World GDP growth, make assumptions of total world population to arrive at per capita World GDP growth, and add it back to the first graph.  The assumed growth rates, by decade, in per capita income are :

2007-2020 : 3.5%

2020-2030 : 3.5-4.0%

2030-2040 : 4.0-5.0%

2040-2050 : 5.0-6.0%

This leads to estimates for per-capita GDP at PPP, in 2007 dollars, to be :

2007 : $10,000

2020 : $15,155

2030 : $22,400

2040 : $32,600 - $36,000

2050 : $53,200 - $64,500

Which, when plotted, provides the following :

Or, when a longer view is taken, in terms of logarithmic periods going back from the year 2050, we see :

   

Needless to say, this degree of acceleration in economic growth affects nearly every possible facet of the world in the 21st century.  From a continually rising stock market to the proliferation of millionaires to the rapid upliftment of all metrics of human development, massive abundance is a certainty.  The inevitable derivatives of wealth, such as the spread of democracy, the upliftment in the sophistication of human psychology, and thus a corresponding drop in warfare, will soon follow.  Resolving current problems, such as reducing poverty in developing regions, to funding sophisticated healthcare technologies, to increasing literacy, to funding ambitious space exploration, are merely just a matter of time. 

Inevitably, even the average citizen in the mid-21st century will have access to many material and psychological opportunities that even the wealthiest of today do not have.  Turn that frown upside down, for you are in for an exciting time as you ride the tsunami of prosperity that is about to immerse you.

This article is the inaugural entry into a new category here at The Futurist titled "Core Articles".  These are the articles which are designed to form the cornerstone of a comprehensive understanding of the future, and are suggested reading for anyone interested in the subject.  Additional articles will be upgraded to "Core" status as augmentations to them accumulate. 

Related :

These Are the Best of Times

The Stock Market is Exponentially Accelerating

The Psychology of Economic Progress

The Age of Democracy

The Winds of War, the Sands of Time

Are You Acceleration Aware?

An Inconvenient Truth

As you may have heard by now, in 2007, China is set to surpass the US in the emission of greenhouse gases.  This has many implications for the concept of environmentalism, and for the geopolitical landscape.

China takes 4.3 times as much energy as the US to produce each dollar of GDP.  Thus, China, with an economy less than a fourth the size of the US, already emits more.  It is true that China's per capita emissions are much lower than the US due to China's much greater population.  However, the US is not the highest in per capita emissions either.  Small nations like Canada and Norway top that list. 

Now consider the implications of this for the near future.  By 2012, China's emissions will be a clear 20% higher than the US, which is a delta too large to ignore.  The environmental movement has some people (like Thomas Friedman) who genuinely care about reducing pollution.  However, a large subset are merely anti-US, anti-capitalism radicals who seek to mask their agenda within the altruism of environmental concerns.  A beloved non-Western, undemocratic nation being a bigger polluter than the US is simply too inconvenient of a reality for their agenda.  This will split the environmental group into two opposing factions - those who truly seek to curb emissions worldwide, and those who are merely driven by anti-Americanism and anti-capitalism.  This civil war will be interesting, to say the least, and the purging of the phonies could just be the best thing to happen to the environmental movement, making it palatable enough for greater participation from mainstream people. 

Furthermore, this is an example of point 10) in my essay on Why the US Will Still be the Only Superpower in 2030.  China is not prepared for the burdens of being the primary recipient for blame on a major global issue.  As the heat on the US reduces at China's expense, China will find that the upper rungs on the ladder to superpowerdom bring the attachment of heavy weights that make each subsequent rung increasingly difficult to scale.  Getting to the top is just not as easy as it may seem, as China will continue to discover.

Liquid Mirrors May Boost Future Telescopes

On September 28, 2006, I made the case that telescopic power is indeed an accelerating technology, set to improve at an estimated rate of 26% a year for the next 30 years.  I believe that increasingly more powerful telescopes will ensure that we discover the first genuinely Earth-like planet in another star system by 2011, and that by 2025, we will have discovered thousands of such planets. 

In support of this thesis of accelerating telescope improvement, I had to bring attention to one particular prospective technology that greatly increases the chances of this predicted rate of improvement holding true : Liquid mirrors that could at some point replace glass in the largest telescopes (from MIT Technology Review). 

The mirror is a pool of salt-based liquids that only freeze at very lower temperatures, coated with a silver film.  While practical usage is at least 20 years away, the details reveal a technology that is brilliantly simple, yet tantalizingly capable of addressing almost all of the problems facing the construction of giant telescopes.  Glass mirrors are exceedingly difficult to scale to larger sizes, and even the most minor defect can render a mirror useless.  Reflective liquid, by contrast, can be scaled up almost indefinitely, limited only by the perimeter of the enclosure it is placed in.  External blows that would crack or scratch a glass mirror would have no effect on a liquid that could quickly return to the original shape.

I don't expect updates on this technology in the near future, but the next logical step would be for a smaller telescope to be demonstrated to use this technology.  If that succeeds, the ultimate goal would be, by 2030, a massive telescope more than 200 meters in diameter placed on the Moon, where the sky is free of atmospheric distortions, and the ground is free of tiny seismic shaking.  This would enable us to observe Earth-like planets at a distance of up to 100 light years, as well as observe individual stars near the center of the Milky Way galaxy (30,000 light years away). 

Related :

Are You Acceleration Aware?

Finding Earth-like Planets Will Soon be Possible

"Mr. Gorbachev, Tear Down This Wall."

It was 20 years ago today, on June 12, 1987, that President Ronald Reagan delivered his famous speech at the Berlin Wall.  Audio highlights are available on YouTube over here. 

In studying this speech, the timing and political tactics of it, particularly when viewed in historical context, are extraordinary.  Reagan could have delivered this speech at any time, but chose to do it only after 6.5 years in office.  Perhaps it is just a coincidence, but perhaps Reagan saw signs that by 1987 the USSR's economy was teetering on the precipice of a downfall.  Perhaps Reagan saw in Mikhail Gorbachev the first Soviet leader who truly wanted the USSR to reform. It was thus the ideal time to remind the world, now in an era of cable television, that the USSR was not willing to let East Berliners interact with the Western world.  It was the ideal time to demonstrate that communism could not attract people to it by their own free will.  It was the ideal time to gain a psychological monopoly on the universal concepts of aspiration and hope, in a speech audible on the other side of the wall.  If Gorbachev was truly a reformer, there was only one way to indisputably prove it. 

But did a mere speech really have such an effect on a powerful empire?  Just because the Berlin Wall fell just 2 years later, and the USSR itself peacefully dissolved just 4 years later, does not mean the speech was anything more than well-timed and inspiring.  The trend of nations migrating towards democracy was evident long before Reagan became President.  Yet consider that in just 20 years, the number of genuine democracies in the world has risen from under 60 in 1987 to 90 today.  The number of unfree regimes has thus dropped correspondingly. 

   

In particular, it is the nations of Eastern Europe that transformed the most in the years following Reagan's speech.  Now, almost all the nations of Eastern Europe, including former Soviet states, are full democracies.  This would have been unthinkable just 20 short years ago, ensuring that this speech become a symbol of the watershed moment when cracks in the Soviet Union became just too numerous to cover up. 

Lastly, Reagan's speech contains lessons that modern leaders, particularly George W. Bush, would do well to learn.  The public is fickle, and cannot be expected to put in the effort to become fully informed about the complex geopolitical issues that affect their societies.  A leader's job is to package an ideology into simple, attractive terms that capture the public's basic aspirations.  This use of soft power should never be underestimated.  George W. Bush could do just as much to overcome rogue states than any military expenditure would achieve, by simply going to South Korea, getting as close to the DMZ as he can, and invoking Ronald Reagan :

General Secretary Kim Jong-Il, if you seek peace, if you seek prosperity for North Korea and Eastern Asia, if you seek assistance from America, come here to this border.  General Secretary Kim Jong-Il, open this border.  General Secretary Kim Jong-Il, tear down this demilitarized zone!

While Kim Jong-Il is an evil psychopath, and certainly should not be compared to Mikhail Gorbachev at any level, this would still bring the spotlight of the world on the oppression and suffering in North Korea, and force Kim Jong-Il to do something to try and save face, which means he either has to make a small concession to the winds of freedom, or react negatively and look even worse.  Either way, the onus squarely is placed on him.

I believe this template has a role to play once again. 

The Semantic Web

The World Wide Web, after just 12 years in mainstream use, has become an infrastructure accessed by hundreds of millions of people every day, and the medium through which trillions of dollars a year are transacted.  In this short period, the Web has already been through a boom, a crippling bust, and a renewal to full grandeur in the modern era of 'Web 2.0'.

But imagine, if you could, a Web in which web sites are not just readable in human languages, but in which information is understandable by software to the extent that computers themselves would be able to perform the task of sharing and combining information.  In other words, a Web in which machines can interpret the Web more readily, in order to make it more useful for humans.  This vision for a future Internet is known as the Semantic Web. 

Why is this useful?  Suppose that scientific research papers were published in a Semantic Web language that enabled their content to be integrated with other research publications across the world, making research collaboration vastly more efficient.  For example, a scientist running an experiment can publish his data in Semantic format, and another scientist not acquainted with the first one could search for the data and build off of it in real time.  Tim Berners-Lee, as far back as 2001, said that this "will likely profoundly change the very nature of how scientific knowledge is produced and shared, in ways that we can now barely imagine." 

Some are already referring to the Semantic Web as 'Web 3.0'.  This type of labeling is a reliable litmus test of a technology falling into the clutches of emotional hype, and thus caution is warranted in assessing the true impact of it.  I believe that the true impact of the Semantic Web will not manifest itself until 2012 or later.  Nonetheless, the Semantic Web could do for scientific research what email did for postal correspondence and what MapQuest did for finding directions - eliminate almost all of the time wasted in the exchange of information. 

New Gadgets for the Digital Home - A BusinessWeek Slideshow

BusinessWeek has a slideshow revealing new electronic devices that a consumer could use to enhance (or complicate) certain aspects of daily life.  Among these is the very promising Sunlight Direct System, which I discussed back on September 5, 2006.  Others, such as the Lawnbott ($2500), cost far more than the low-tech solution of hiring people to mow your lawn for the entire expected life of the device, ensuring that mass-market adoption is at least 4-5 years away. 

All of this is a very strong and predictable manifestation of The Impact of Computing, which mandates that entirely new categories of consumer electronics appear at regular intervals, and that they subsequently become cheaper yet more powerful at a consistent rate each year.  Let us observe each of these functional categories, and the rate of price declines/feature enhancements that they experience.

Further Thoughts on US Immigration Policy

I wrote an article on February 20, 2006 about the real reason the US government refuses to regulate illegal immigration, and why the simplistic rationales floating around are bogus.  I believe the points provided in that article continue to be true. 

My thoughts on general immigration to the US are free-market oriented, and thus in opposition to isolationist conservatives as well as big union leftists.  I believe that, within reason, immigration to the US should accomodate market forces. 

However, the immigration situation today is nearly the opposite of this.  11 million have entered the US illegally, and are mostly at the bottom of the skill ladder, thus consuming far more taxpayer resources than they contribute.  They are actually a disproportionaly high percentage of our prison population.  At the same time, the pathway for highly skilled immigrants to smoothly and easily settle in the US is bureaucratic, painful, and often takes 7-12 years to complete.  During this process, they are restricted from changing employers to seek better opportunities, are unable to secure permission for their spouses to work, and live with the psychological burden of being in limbo for an inhumane duration of time. 

Making it easy for people at the bottom of the skill ladder to come here through violation of our laws, while making it extremely tortuous for people at the top of the skill ladder to come here legally, has got to be just about the biggest failure in US governmental policy today. 

I am under no illusions that the mediocre intellects in the US government will be able to execute such a simple yet beneficial overhaul of our immigration paradigm, but I will propose a solution anyway.

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The US should allow free, easy, unlimited immigration of any individuals who have completed a Bachelor's degree in any field, from any country, from a demonstrably legitimate institution.  The US decides which institutions meet the criteria of accreditation/legitimacy, and maintains the list, by country, on an easily accessible website.  I would not even restrict it to people with only engineering degrees, or people who have only been educated in English.  I believe that just about anyone with this level of education can quickly get a decent job in America, particularly since only those who are confident in their abilities will make the move to begin with. 

Currently, about 30% of US adults above the age of 25 possess a Bachelor's degree, and it makes sense to bring in people who increase this percentage, rather than decrease it (as current unskilled illegals do).  The unemployment rate for people with a Bachelor's degree is just 1.2%.  Even a policy this open will not result in more than 750,000 people immigrating to the US per year.  At an average of $60,000 a year, this adds an incremental $45 Billion to US GDP every year, which is a 0.3% increment to GDP growth every year.

At the same time, immigration of people with less education should be restricted to minimal quantities.  There is no reason to dilute the educational attainment of US society, and thus dilute per-capita GDP.  The bogus claim that "they do critical jobs that Americans will not do" is easily disproven by the fact that in the 1980s and 1990s, states like Ohio, Pennsylvania, New Hampshire, North Carolina, etc. were fully functioning societies without the need for a vast underclass of unskilled illegals.  US-born citizens did minimum wage jobs in those societies. 

In short, we should bring in more above-average people and fewer below-average people.  The simple policy outlined above will have vast and dramatic benefits to the US economy and American society.  Economic growth and tax receipts will surge.  Real estate prices will rise and construction will boom.  MNC's will re-center more of their operations in the US.  College-educated immigrants are the cause of almost no violent crime.  Political and economic ties with India and China will strengthen, as most of the new immigrants will be from these two nations.  There is virtually no downside amongst these multiple upsides, and I challenge anyone to come up with one (the notion of wage despression through such immigration is already debunked). 

Yes another benefit is the destruction of 'political correctness' that accompanies the present debate.  An education-weighted immigration policy will favor Indian, Chinese, South Korean, and Russian immigration, while locking out many Mexican and Central American immigrants.  Different cultures attach differing importance to education, and while this is readily visible in the free market that is the US workforce, multiculturism has erected barriers to obstruct these market forces.  It is time that the US became more pragmatic in this regard. 

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Australia, a very pragmatic and well-run nation, already has a policy that gives preference to highly skilled immigrants.  Thus, Australia's Human Development Index has surpassed that of the US.  Ireland, too, has executed a similar strategy with great success, and is now wealthier than Britain, France, and Germany. 

Again, I have no hope that such a simple and constructive overhaul will occur.  If only the US were shrewd (again).......

Update (6/21/07) : BusinessWeek has an article about exactly this, one month later than I have written about it here.

Senate Votes 80-14 to Fund Iraq, No Timetable Attached

I have been writing for a long time about how Democrat Senators are stuck in the unenviable situation of having to appease the far-left component of their base (which includes the 8-10% of the US population that are an active fifth-column), while not straying too far from the 70% of the US population that is pro-US, in order to have any chance of getting 50% of the vote in an election.  Thus, each Democrat has to appease two different constituents with diametrically opposed goals.  This leads to nearly unavoidable yet massive contradictions between the words and actions of prominent Democrats.

Previous articles on this topic include :

Senate Renews Patriot Act 89-11 (written March 2, 2006).  That is a pretty strong majority even of Democrats, particularly after they had 4 years to hear criticisms of the Patriot Act.  All the leftist fuss over the Patriot Act is meaningless if they can't even convince more than 11 Democrats to vote against it.

Senate Votes 93-6 to Keep Troops in Iraq (written June 17, 2006).  All the fuss about ending the war is meaningless blather, if only 6 Democrats actually vote along those lines, while 37 did not. 

Now, another major example of the same divergence between words and action has occurred. 

The Senate has just voted 80-14 to fund the Iraq War, without any definite timeline for withdrawal.  Only 14 out of 49 Democrats voted against continued funding, despite the last 6 months of wasted airtime devoted to such propaganda.  This is even a greater margin than the 77-23 margin in 2002 to invade Iraq in the first place.  Interestingly, Hillary Clinton was among those who voted for the war in 2002, but is among the 14 voting against funding it now.  This will be very damaging in her quest to win the votes of moderates. 

Actions speak louder than words, and most Democrats continue to vote in favor of two items that fifth-columnists hate - the Patriot Act and the Iraq War.  Ignore the talking heads and left-wing media, and just look at the votes.  That is the only barometer of where their true opinions reside. 

Related :

The Way to Debate Iraq

We Will Decisively Win in Iraq....in 2008

A Future Timeline for Automobiles

Many streams of accelerating technological change, from energy to The Impact of Computing, will find themselves intersecting in one of the largest consumer product industries of all.  Over 70 million automobiles were produced worldwide in 2006, with rapid market penetration underway in India and China.  Indisputably, cars greatly affect the lives of consumers, the economies of nations, and the market forces of technological change. 

I thus present a speculative timeline of technological and economic events that will happen for automobiles.  This has numerous points of intersection with the Future Timeline for Energy. 

2007 : The Tesla Roadster emerges to not only bring Silicon Valley change agents together to sow the seeds of disruption in the automotive industry, but also to immediately transform the image of electrical vehicles from 'punishment cars' to status symbols of dramatic sex appeal.  Even at the price of $92,000, demand outstrips supply by an impressive margin. 

2009 : The Automotive X-Prize of $25 Million (or more) is successfully claimed by a car designed to meet the 100 mpg/mass-producable goal set by the X Prize Foundation.  Numerous companies spring forth out of prototypes tested in the contest. 

2010 : With gasoline at $4/gallon, established automobile companies simultaneously release plug-in hybrid vehicles.  Hybrid, plug-in hybrid, and fully electrical cars represent 5% of total new automobiles sold in the US, even if tax incentives have been a large stimulus.  The habit of plugging in a car overnight to charge it starts to become routine for homeowners with such cars, but apartment dwellers are at a disadvantage in this regard, not having an outlet near their parking spot. 

2011 : Two or more iPod ports, 10-inch flat-screen displays for back seat passengers, parking space detection technology, and embedded Wi-Fi adapters that wirelessly can transfer files into the vehicle's hard drive from up to 500 feet away are standard features for many new cars in the $40,000+ price tier. 

2012 : Over 100 million new automobiles are produced in 2012, up from 70 million in 2006.  All major auto manufacturers are racing to incorporate new nanomaterials that are lighter than aluminium yet stronger and more malleable than steel.  The average weight of cars has dropped by about 5% from what it was for the equivalent style in 2007. 

2013 : Tesla Motors releases a fully electric 4-door sedan that is available for under $40,000, which is only 33% more than the $30,000 that the typical fully-loaded gasoline-only V6 Accord or Camry sells for in 2013. 

2014 : Self-driving cars are now available in the luxury tier (priced $100,000 or higher).  A user simply enters in the destination, and the car charts out a path (similar to Google Maps) and proceeds on it, in compliance with traffic laws.  However, a software malfunction results in a major traffic pile-up that garners national media attention for a week.  Subsequently, self-driving technologies are shunned despite their superior statistical performance relative to human drivers. 

2015 : As predicted in early 2006 on The Futurist, a 4-door sedan with a 240 hp engine, yet costing only 5 cents/mile to operate (the equivalent of 60 mpg of gasoline), is widely available for $35,000 (which is within the middle-class price band by 2015 under moderate assumptions for economic growth).  This is the result of combined advances in energy, lighter nanomaterials, and computerized systems. 

2016 : An odd change has occurred in the economics of car depreciation.  Between 1980 and 2007, annual car depreciation rates decreased due to higher quality materials and better engine design, reaching as little as 12-16% a year for the first 5 years of ownership.  Technology pushed back the forces of depreciation. 

However, by 2016, 40% of a car's initial purchase price is comprised of electronics (up from under 20% in 2007 and just 5% in 1985), which depreciate at a rate of 25-40% a year.  The entire value of the car is pulled along by the 40% of it that undergoes rapid price declines, and thus total car depreciation is now occuring at a faster rate of up to 20% a year for the first 5 years.  This is a natural progression of The Impact of Computing, and wealthier consumers are increasingly buying new cars as 'upgrades' to replace models with obsolete technologies after 5-7 years, much as they would upgrade a game console, rather than waiting until mechanical failure occurs in their current car.  Consumers also conduct their own upgrades of certain easily-replaced components, much as they would upgrade the memory or hard drive of a PC. Technology has thus accelerated the forces of depreciation. 

2018 : Among new cars sold, gasoline-only vehicles are now a minority.  Millions of electricity-only vehicles are charged through solar panels on a daily basis, relieving those consumers of a fuel expenditure that was as high as $2000/year in 2007.  Even when sunlight is obscured and the grid is used, some electrical vehicles cost as little as 1 cent/mile to operate.

2020 : New safety technologies that began to appear in mainstream cars around 2012, such as night vision, lane departure correction, and collision-avoiding cruise control, have replaced the existing fleet of older cars over the decade, and now US annual traffic fatalities have dropped to 25,000 in 2020 from 43,000 in 2005.  Given the larger US population in 2020 (about 350 Million), this is a reduction in traffic deaths by half on a per-capita basis. 

2024 : Self-driving cars have overcome the stigma of a decade prior, and are now widely used.  But they still have not fully displaced manual driving, due to user preferences in this regard.  Certain highways permit only self-driven cars, with common speed limits of 100 mph or more. 

2025-30 : Electricity (indeed, clean electricity) now fuels nearly all passenger car miles driven in the US.  There is no longer any significant fuel consumption cost associated with driving a car, although battery maintenance is a new aspect of car ownership.  Many car bodies now include solar energy absorbant materials that charge a parked car during periods of sunlight.  Leaving such cars out in the sun has supplanted the practice of parking in the shade or in covered parking.

Pervasive use of advanced nanomaterials has ensured that the average car weighs only 60% as much as a 2007 counterpart, but yet is over twice as resistant to dents. 

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I believe that this timeline represents the the combination of median forecasts across all technological and economic trends that influence cars, and will be perceived as too optimistic or too pessimistic by an equal number of readers.  Let's see how closely reality matches this timeline. 

The Politics and Economics of American Taxation

The US tax code, at 67,000 pages, is an embarassing swamp of esoteric gobbledygook, unworthy of a nation which is supposed to be the shining light of capitalism, entrepreneurship, and productivity. 

Deroy Murdock has a detailed article on how inefficient the mere transaction of collecting tax monies from individuals is :

“The IRS estimates they (small business owners) have to spend over 80 hours slaving at their computers to do their taxes, enough to rob them of the equivalent of a two-week paid vacation.”

I don't need to remind any US residents on how time-consuming and/or costly their own tax preparation has been, but suffice it to say that if fees, time, processing resources at the IRS, and postal services are added up, the total burden adds up to $400 to $600 billion a year in transactional wastage for the US economy.  This is as large as the total economy of a country like Switzerland or Belgium. 

Just about the best thing that Washington could do to further stimulate the already robust US economy is simplify the process through which taxes are collected.  Again, this is not a tax cut, but merely a reduction in the transaction costs of extracting the same amount of revenue from taxpayers.  Yet, the resultant productivity gain would increase GDP by 2-3% almost immediately. 

I am baffled why not just the Federal Government, but even many State Governments are unwilling to collect the same revenue through a simpler process.  I hear rationalizations about how "tax accountants don't want to go out of business", but that excuse makes about as much sense as tearing up roads and relaying them repeatedly in order to employ workers.  And since when has there been a 'tax accountants lobby' powerful enough to obstruct the wishes of just about every other taxpaying citizen and business in America?

The even bigger irony is that simple tax codes have been adopted in former communist regimes like Russia and Ukraine.  Tax evasion has predictably plummeted, even as revenues have surged.  Why is America unable to enact a capitalist principle that former Soviet states have implemented?

On the political side, while neither party has indicated any intention of simplifying the tax code, Michael Mandel at BusinessWeek has created some revealing charts on tax rates by income bracket, both before and after various tax cuts.  Between 1981 and 2004, the lower the income quintile, the greater the magnitude of tax rate reduction has been due to tax cuts by Presidents Ronald Reagan and George W. Bush.  If anything, the highest quintile is the only tier that has seen virtually no tax rate relief. 

 

Also note the line chart showing the tax rate drop for the middle quintile after 2001.  This utterly destroys the fashionable socialist statement that Bush's tax cuts were "for the rich" - a line often spewed by someone who is incapable of detailing precisely which tax bracket was lowered by how much.  Of course, you may not have this chart handy the next time you encounter someone who opposes tax cuts for reasons they can scarcely explain.  Thus, as usual, such a debate is won by forcing them to demonstrate knowledge of the subject behind their own question, through a question of your own.

If they say :

"....tax cut for the rich"

you can reply with :

"Please explain which tax bracket dropped by how much through Bush's tax cut.  I need to see that you know how much the lower brackets dropped by."

or

"Why do you oppose Bush's tax cuts, but not Clinton's 1997 tax cuts?  Clinton cut taxes on capital gains, which certainly is good for the economy, but is far more skewed towards the rich than income is.  Why don't you describe Clinton's tax cuts in more detail for me?"

At any rate, these debates are easy to win.  But I will not excuse President Bush or Congress from refusing to address tax simplification, and letting the horrendous statistic of 19 to 23 cents being wasted in the process of collecting each revenue dollar continue. 

Hope is on the horizon, however.  Globalization is introducing market forces that are putting downward pressure on tax rates and tax complexity worldwide. Ireland has outperformed the rest of Western Europe by a wide margin in the last 12 years due to vastly lower taxes, which in turn attracts workers and businesses away from higher-tax welfare states.  If the US sees an exodus of business incorporations that are instead flocking to Ireland or Bermuda, perhaps Washington will finally act. 

Outsourced Education - the Latest Flattener

I have come across a modest yet revolutionary concept from an Indian startup by the name of Tutorvista.  The concept is not a complex one, but if this company or others like it are even moderately successful with this business model, we stand to chip away at one of society's most stubborn obstacles to economic upliftment. 

Tutorvista offers unlimited online tutoring in English and Mathematics for just $100 a month, as well as preparatory coaching for standardized tests at fees under a tenth of those charged by traditional brand-name classes.  All 500+ tutors are in India, have degrees in education and the subject taught, and work from home.  I believe there are about 2500 students subscribing to the service to date.  Tutorvista does, however, need to make substantial improvements to their website if they hope to acquire hundreds of thousands of new customers.

The tutoring sessions are interactive through the use of technologies that were not even available to consumers just 7 years ago.  Real-time verbal dialogue is conducted via VoIP, while an onscreen electronic whiteboard enables written exchanges.  Soon, low-cost videoconferencing technologies will combine with high-bandwidth Internet connections to expand interactivity into not just face-to-face lessons, but even multi-party discussions with each participant's face in one division of the screen.

Normally, such tutoring would cost $30 to $50 an hour or more.  Yes, pessimists, racists, and socialists (sometimes the same people) will whine about private tutors losing their wages to 'outsourcing'.  But this loss is dwarfed by gains derived from having access to competent individual tutoring now available to underprivileged or simply ambitious students in America.  Is a 5th grader so keen on algebra that he wants to soak up 8th grade material?  The risk to parents is just $100 (and even that fee can probably be transferred to a lower grade if the material turns out to be too advanced).  Does a student feel embarassed about persistent difficulties with a particular subject?  This model offers privacy that did not exist before. 

Of course, to benefit from Tutorvista, an American student needs both a broadband connection and the self-discipline to study hard.  It is arguable that students for which these two conditions are true do not corelate very closely with those who need the most help.  Yet, I could predict the formation of innovative scholarships devised to grant high-school students some form of 'unlimited Tutorvista access until high-school graduation'.  It may even become a popular perk offered by the parent's employer.

This, like Skype, Wikipedia, Zillow, and MapQuest, is yet another dramatic deflation in the costs (whether monetary or time/hassle-oriented) of accessing a key human need, and is a necessary step in the acceleration of economic growth.  If Tutorvista or a similar company can succeed, the benefits to the US, Indian, and global economies will colossally dwarf the losses of in-person tutor wages and private school fees.  Step back and take a moment to ponder what you have just read - the paradigm for the delivery of education has just changed. 

A Biden/Hagel Washington Post Op-Ed, Dec. 2002

Here is an Op-Ed piece written by Senators Joe Biden and Chuck Hagel in December 2002, before the US invasion of Iraq.  Sen. Biden is a Democrat, and Sen. Hagel is a Republican. 

It is a well-written piece with impressive foresight and details into how it would take a decade to turn Iraq into a stable democracy, after the fall of Saddam Hussein.  I agree with every single thing stated in the article, including :

"Americans are largely unprepared for such an undertaking. President Bush must make clear to the American people the scale of the commitment. "

Also, this piece is notable for the absense of any mention of Saddam's WMD programs.  Even though the article is about post-Saddam reconstruction, this omission is notable given the sentence about how there is no doubt that coalition forces would prevail against those of Saddam Hussein.  This would suggest that this was not the Senate's primary reason for authorizing regime change in Iraq (even though Bill Clinton, in December 1998, did authorize a military campaign for the specific purpose of thwarting Saddam Hussein's WMD program). 

What is sad is that both Biden and Hagel are now voting to defund the troops and deliberately induce a defeat, 4 years into the undertaking that they themselves said would take a decade to complete.  What happened to actually being Statesmen (like Joe Lieberman, John McCain, and George W. Bush), rather than poll whores?  Fortunately, these Statesmen still appear to have the upper hand, and will ensure that victory in 2008 is still on track.

The good news is that the blogosphere is gaining in power and penetration, and will ensure that valuable articles like these will be discovered and brought forth for voters to see.  It will be increasingly harder for politicians to sway with the winds of fashion and hope no one discovers what they had said earlier.

Update : N.Z. Bear on how the Democrats have positioned themselves to lose if Iraq succeeds, a risk they did not have to take. 

Update : More from Charles Krauthammer, who is often makes very original observations and articulations.

World and Asian Semiconductor Revenue Growth

I stumbled upon something while reading the Asian Development Bank's report on the world economy.  No big surprises here, but one tiny chart stood out.  The column chart of WW and Asian semiconductor sales from 2001 to 2006 indicates that while Asia accounted for just one third of semiconductor sales in 2001, they comprise half of it today. 

This encompasses a number of the main topics I discuss on The Futurist.  From The Impact of Computing (which is thus higher in Asia than in the rest of the world) to the accelerating rate of GDP growth (which necessitates so many large Asian countries, totaling 3 billion people, to all grow at 6% or more per year, just to keep total world GDP at its trendline).  From cellphone dispersion to PC adoption to enterprise server and router usage, semiconductor sales are just about the best indicator of economic and technological progress. 

Let's see how big of a share of world seminconductor revenues Asia can ultimately consume before the relative maturity of the US market is emulated. 

Related :

Are You Acceleration Aware?

Economic Growth is Exponential and Accelerating

The Mainstreaming of Virtual Reality

BusinessWeek has an article and slideshow on the rapidly diversifying applications of advanced VR technology. 

This is a subject that has been discussed heavily here on The Futurist, through articles like The Next Big Thing in Entertainment, Parts I, II, and III, as well as Virtual Touch Brings VR Closer.  The coverage of this topic by BusinessWeek is a necessary and tantalizing step towards the creation of mass-market products and technologies that will enhance productivity, defense, healthcare, and entertainment. 

Technologically, these applications and systems are heavily encapsulated within The Impact of Computing with very few components that are not exponentially improving.  Thus, cost-performance improvements of 30-58% a year are guaranteed, and will result in stunningly compelling experiences as soon as 2012. 

To the extent that many people who seek reading material about futurism are primarily driven by the eagerness to experience 'new types of fun', this area, more than any other discussed here, will deliver the majority of new fun that consumers can experience in coming years. 

Update (4/7/07) : HP unveils a variety of new technologies, from screens to sensors, designed to augment the realism of games.   

Zogby Poll - 64% Believe Media Tilts to the Left

A recent Zogby poll confirms what most Americans already know painfully well, that the mainstream media is significantly further to left of the political spectrum than the general population. 

Of all respondents, 64% feel the media as a leftist bias and only 28% perceive a right-leaning bias.  Republicans aside, 66% of Independents and even 17% of Democrats believe that the media has a leftist bias. 

Of course, none of this is a surprise.  This brings us to the useful part of this article.

Many leftists have a knee-jerk reaction to any mention of Fox News.  Whether they have ever seen it or not, they are firmly convinced that it is a fanatically right-wing news network.  The fact that Fox does feature liberals like Alan Colmes, Juan Williams, and Greta Van Susteren while CNN, MSNBC, etc. feature almost no Republican voices is unimportant in the formation of this opinion.

Even if we concede that Fox News is biased to the right, that makes it just one out of eight news networks with a Republican bias.  The left thus still controls 7 out of 8 news networks.  Why, then, the obsession over the lack of a total monopoly, when they already have an 87.5% monopoly?  Because their opinion is not logical, merely fashionable.  There is a reason 'fashion' and 'fascism' are similar-sounding words - they originate from the Latin words for conformity. 

So when your opponent says :

"..(some statement insinuating that Fox News deserves condemnation for having a right-wing bias)"

you can then call them on their hypocrisy by stating :

"But out of 8 news networks, if 7 are left-wing, and just 1 is right wing, and even that network contains liberals, why does Fox News bother you so much?  If only 1 out of 8 news networks caters to half of the population, yet you want to suppress even that, that means you are opposed to free speech, doesn't it?  How is what you seek even remotely fair?"

They will, of course, either quickly change the subject or attack you personally with childish insults.  Either tactic is evidence that you have exposed their desire to suppress free speech.  If they insist that Fox News should be suppressed because Republicans are 'dumb', then remind them of how people earning over $50,000  a year overwhelmingly voted for Bush, while Kerry had a majority only among those who earn under $30,000 a year.  Income may not corelate directly to intelligence, but income certainly does not have an inverse corelation with intelligence.  Anyone who suggests that a group that is 'rich' is simultaneously 'dumb' is desperately trying to fight off realities that fail to affirm their belief in their own intelligence.  This usually leads to a hatred of American meritocracy, for obvious reasons. 

Winning these debates is remarkably quick and easy, once you learn to offer rebuttals that take the form of questions that the opponent must think about, rather than facts that can be easily ignored. 

Update : Here is a remarkable attempt by Reuters to spin US success against Al-Qaeda as a negative, in a "success creates long-term problems" vein.

Update (6/21/07) : Actually, 64% is low.  MSNBC has identified that journalists donate to Democrats over Republicans at an 88% to 12% rate.  That they are this undiversified in ideology is problem enough, but that an agenda pervades duties that should be held to certain professional standards is even worse. 

Related :

The Way to Debate Iraq

Deconstructing the 'Leftist' Mind

America, in Relation to Peers

Do you feel that America is having a bad time?  That economically, politically, and culturally, we are in a rut?  Do you even wish that America had something that some other nation or region currently has?

Be careful what you wish for.

A European study has estimated that the EU economy is only as developed as the US was 22 years ago.  This does not even include the newest, poorer members of the EU like Romania and Bulgaria, which would drag down the EU stats even further.  Furthermore, the EU has a growth rate slower than that of the US, guaranteeing that the gap will continue to widen. 

Related : More on the Decline of Europe.

But China has a rapid economic growth rate, that enables it to catch up with the US, does it not?  With China's huge population, it needs to merely achieve a per-capita GDP that is one fourth that of the US in order to surpass the total size of the US economy.  That should be relatively easy, no?

China is not permitting new Internet cafes to open in 2007.  So much for free-market supply/demand, or supercharging economic growth through participation in the information age.  It appears that the question of how high prosperity can rise before the demand for personal freedoms directly forces the PRC to curb progress has been answered.  The PRC will continue to face more direct tradeoffs between economic growth and the restriction of personal freedoms.  It will be interesting to see which area they choose to make concessions in over the coming years.

How about India, then?  India will never restrict Internet access for the public, and has a young, growing population that Europe lacks.  GDP growth topping 8% certainly qualifies as enviable.  Surely, India has potential.

And it will always have potential.  If Europe is 22 years behind the US in economic growth, it would be impossible to calculate how far behind India is by that metric, as the US is only 231 years old (and has never been as poor as India is today).  India's infrastructure is so shabby that highways have an average speed of 20 mph, and large cities have to resort to restricting electricity availability to six days a week in order to ease grid overloads.  On the UN Human Development Index, India ranks a miserable 127th, even lower than many dictatorships and communist states.  India's per capita GDP is just $700 a year, a number which, by American standards, seems scarcely higher than zero.  8% annual GDP growth for the next 30 years will still only bring prosperity in India to where Mexico is today.

But, despite India being the poorest entity in this article, all Americans should note that India is the only entity here that is pro-US, and actually wants to emulate the US, rather than create an alternative model like the EU and China have attempted.  India deserves pity, but also encouragement from America. 

So there we have the state of three other regions that America is often compared to.  I will also throw in this chart of per capita GDP on a PPP basis, over the last 60 years.  The biggest takeaway from here is that basic growth appears easy, as a developing nation merely has to copy what was done by advanced nations before, but once a certain ceiling is reached, incremental growth becomes harder.  No large country of over 50 Million people and a per capita GDP greater than $20,000 a year has managed to sustain a growth rate higher than the world average (currently 4.5%) for an extended period.  Thus, China's rapid growth will moderate long before high per-capita GDP is reached, just as Japan's and South Korea's has.  Also note that India was richer than China all the way until 1991, and was probably at parity with South Korea and even near Japan in 1950, until India foolishly allowed itself to fall behind. 

Remember, the true measure of a country is the net of how many people want to get in, and how many want to get out.  This metric appears to rank America right on top. 

Related : Why the US Will Still be the Only Superpower in 2030. 

A Future Timeline for Energy

There are many independent streams of technological progress currently underway in the field of energy.  I have written several individual articles on various breakthroughs in lighting, electic cars, ethanol, etc.  But the time has come for a 'grand unifying' article that combines these seemingly unrelated innovations into a timeline for when we can expect which advances to have a measurable impact. 

I hereby present a possible future timeline for disruptive improvements in energy technology, economics, and mass market adoption.

2007 : China's greenhouse gas emissions surpass that of the US.  China requires 4.3 times as much energy as the US to produce each dollar of GDP. 

2007-09 : Compact Fluorescent Lightbulbs and Light Emitting Diodes begin to replace incandescent bulbs across the US.  By 2010, the typical US household is saving over $100 per year in electricity costs.

2007-10 : Corn-based ethanol continues to generate only a small percentage of vehicle fuel in the US, despite the governmental support behind it. 

2009 : The Automotive X-Prize of $25 Million (or more) is successfully claimed by a car designed to meet the 100 mpg/mass-producable goal set by the X Prize Foundation. 

2010 : Hybrid, plug-in hybrid, and fully electrical cars represent 5% of total new automobiles sold in the US, even if tax incentives have been a large stimulus.  There are concerns about the load on the electrical grid from all of these new cars drawing power from ordinary home outlets, but given the massive reduction in household electricity consumed by lighting, this surplus nicely offsets the electrical demands of plug-in cars. 

2011 : Thousands of wind turbines have been erected across Alaska, Canada, Russia, and the northern waters of Europe by now.  Some European countries now derive over 25% of their electricity from wind. 

2012 : Cellulostic ethanol technology becomes cost-effective and scalable.  Biomass-derived fueling stations finally begin to find their way into most US population centers, but still displace only 15-20% of US gasoline consumption.  New oil extraction technologies continue to exert downward pressure on oil prices, resulting in a continual tussle between biomass fuel and oil-derived fuel for cost competitiveness.  All of this is bad news for oil-producing dictatorships. 

2013 : Tesla Motors releases a fully electric 4-door sedan that is available for just $40,000, which is only 33% more than the $30,000 that the typical fully-loaded gasoline-only V6 Accord or Camry sells for in 2013. 

2014 : Solar panels have become inexpensive enough for a typical house in California or Arizona to financially break even in under 5 years after installation, even after accounting for the cost of capital.  Over 3 million US single-family homes have solar panels on their rooftops by now, and many of these homes are able to charge up their plug-in hybrids or fully electric vehicles entirely free of cost. 

2015 : As predicted in early 2006 on The Futurist, a 4-door sedan with a 240 hp engine, yet costing only 5 cents/mile to operate (the equivalent of 60 mpg of gasoline), is widely available for $35,000 (which is within the middle-class price band by 2015 under moderate assumptions for economic growth).  This is the result of not only energy innovation, but also lighter, stronger nanomaterials being used in some body components, as well as computerized systems that make energy usage more efficient within the car. 

2016 : Large industrial-grade solar panels, enhanced with nanotechnology, achieve unprecedented conversion rates of solar energy to electricity.  The US has completed the construction of major solar farms in California, Nevada, and Arizona, collectively covering hundreds of square miles of desert land.  Similar farms are under construction in Australia, India, Saudi Arabia, Iraq, and Sahara Desert countries.  10% of world electricity demand is now met through photovoltaics. 

2018 : Among new cars sold, gasoline-only vehicles are now a minority.  Millions of electricity-only vehicles are charged through solar panels on a daily basis, relieving those consumers of a fuel expenditure that was as high as $2000/year in 2007.  Even when sunlight is obscured and the grid is used, some electrical vehicles cost as little as 1 cent/mile to operate. 

2020 : Gasoline fuels under one third of the passenger car miles driven in the US.  Electricity and biomass fuels account for the remaining two-thirds, with electricity being the one crowding the other two out (electricity itself is primarily derived through solar, wind, and nuclear sources by now).  US total oil consumption, in barrels, has decreased only somewhat, however, due to commercial airline flights (which still use petroleum-derived fuels).  At the same time, oil consumption in relation to total US GDP is actually under half of what it was in 2007. 

2025-30 : Electricity (indeed, clean electricity) now fuels nearly all passenger car miles driven in the US.  There is no longer any significant fuel consumption cost associated with driving a car, although battery maintenance is a new aspect of car ownership.  The average car weighs only 60% as much as the 2007 counterpart, but yet is over twice as resistant to dents.  Most cars are self-driven by on-board intelligence, so human drivers can literally sleep in the car while being delivered to their destination. 

Wind, solar, and nuclear technologies collectively generate 75% of the world's electricity needs. 

Crude oil is, however, still used to create jet fuel.  Since some passenger jets are capable of hypersonic speeds, oil consumption remains significant in this area. 

Worldwide energy consumption is now 75% higher than what it was in 2007, moving us from 0.71 to 0.74 on the Kardashev scale. 

Is this timeline too optimistic?  I found this research report from Clean Edge that goes out to 2016, and they project that renewable energy industry revenue will grow by 15% a year from 2006 to 2016.

Let's see how closely reality matches this timeline. 

Update (9/15/07) : Seven months after I created this timeline, BusinessWeek has a slideshow that predicts the impact of many of the same technologies.  In fact, CFLs, LEDs, the Tesla Roadster, Plug-in Hybrids, etc. are all items I wrote about even earlier. 

BusinessWeek : The Greatest Innovations of All Time

BusinessWeek has an article and slideshow featuring a list of what the author estimates to be the 15 historical innovations that have created the greatest improvements to human life.  Not all the innovations are technological or scientific - some are financial, politcal, and legal.

Rather than debate the candidates or the ranking, what leapt out at me is something that most people overlook, but something I have nearly made the primary theme of this blog :

Notice that of the 15 innovations, 11-12 emerged in the last 200 years, and only achieved wide participation/ownership in the last 60-80 years.  The 5000 years preceding the 19th century had only 3-4 of these 15 innovations reach maturity.  Even a major dispute with the list will inevitably lead to a different list that is similarly weighted very heavily to the recent past. 

Accelerating change is visible in this list, even if the concept is not mentioned (if noticed at all) by the author.  This also tells us that the next 30 years will have several new innovations disruptive enough to earn a place on such a list. 

What will the next great innovations be, under this methodology?  I think nanotechnology is one, and virtual reality is another that could make this list by 2020.  Time will tell, but the most important thing to internalize is that the interval between each major transformative leap continues to shorten. 

The Seeds of Technology

As we have seen before, technological change follows a smooth, exponential curve, with a relatively predictable rate of progress.  However, the fruits of this change accrue to those individuals, corporations, and most importantly, those nations which position themselves to benefit from it.  This requires funding for even the earliest stages of the process, where the return is going to be highly uncertain. 

The US remains the foremost source of scientific breakthroughs and technological innovations, partly due to our willingness to fund federal basic research and sustain institutions that can productively utilize these funds.  The $140 Billion that the US spends on federal R&D is greater than the nominal total GDP of all but 35 countries.  But are we funding research enough, and in the correct way? 

First, let us take note of federal R&D expenditures as a percentage of GDP (which is the only way to accurately measure it). 

First, it appears that President Clinton trimmed R&D each year he was in office, until R&D fell from 1.2% to just 0.8% of GDP.  The brief budget surplus he took credit for near the end of his term was largely at the expense of R&D expenditures.  Had he maintained R&D expenditures at the same percentage of GDP throughout his Presidency, he would not have achieved a budget surplus.  Now tell me, which outcome would you have rather had?

President Bush increased R&D funding and got it back to historical levels in his first term.  However, his second term has brought another slight downward trend, which I hope is reversed in the next few years.  He is still keeping it higher than it was for most of the Clinton years, however.

Some have argued that funding should gradually become an increasingly larger percentage of GDP, as technological changes continue to affect a greater share of the US economy.  I might agree, but I also feel that since US scientific innovations lead to products and services that benefit every nation in the world, other prosperous nations should also be obligated to fund basic research in their own countries.  Europe and China spend much less than the US, as a percentage of GDP, and it is time they they contributed more to the advancement of human knowledge, rather than simply benefit from US resources. 

As far as which fields of science are being funded and which are not, the next chart provides the answer.  Basic research (the red line in the first chart) is broken out by agency.   

It does appear that President Bush has reduced the funding of NASA, but he has increased NIH funding tremendously.  Even defense has not risen over the past several years, contrary to popular belief.  Energy reseach has risen slowly over the past 30 years, but there has been no major boost to the DoE at any point. 

There you have it - the state of the seeds that lead to fruits we reap years and even decades hence.  Is it enough?  How do we measure which agency uses a dollar better relative to others?  Should we be spending this much when other countries spend much less, and simply wait for our breakthroughs?  Can more be done with the same amount of funding dollars?

The Way to Debate Iraq

If you don't believe that an anti-US fifth column (8-10% of the US population) exists in America, read these voluntarily written articles from some very well-known blogs.  Anyone, Democrat or Republican, Liberal or Conservative, who feels any love for the United States, will be offended by this :

Daily Kos, The Left Coaster, Daily Kos again, the burning of US soldiers in effigy, the comments here, this poll stating that 11% are hoping for America to lose in Iraq, and Rosie O'Donnell defending 9/11 mastermind and Al-Qaeda No. 3 Khalid Sheikh Mohammad on national TV (even though he also confessed to making plans to assassinate Jimmy Carter and Bill Clinton).  Even Glenn Reynolds of Instapundit, as genuine of a political moderate as one can ever hope to find, has arrived at a similar conclusion, going even further than me by saying the 'left' sides with America's enemies, as has Captain Ed.  I don't think the fifth column represents all of the 'left', however. 

There is a significant percentage of the US population that does not want the US to win in Iraq (and will deny the existence of victory when we achieve it by 2008).  Some because they have always hated America (fifth-columnists), others simply because they hate President Bush so much, beyond any policy disagreement, that they want to discredit him even if it means harming America (Bush Derangement Syndrome), and yet others because it is a socially fashionable opinion to hold, and they need to conform to the groupthink of their clique (fashion sheep). 

This is an article I could have written a long time ago.  I refrained in order to wait until the anti-US fifth column overplays their hand, which has happened.  Applying true Sun-Tzu tactics, their exhausted state is the perfect time for a counterattack. 

You can win debates against all of them easily, by debating them on principle, which they are usually not confronted on, and observing their willingness to offer constructive ideas.

Also, never refer to these people as 'liberals', 'progressives', and 'elites'.  This is not only an insult to genuine classical liberals (who have an open mind and can come to agreement with others easily), but these are terms that the actions of anti-Americans are quite the opposite of.  Does it make much sense to debate someone if, from the start, they insist that you address them as the smarter person among the two of you, without them having to earn that status through deeds?  So don't allow them to stealthily get away with this branding over here. 

Here are some examples of common one-liners (in italics) and possible responses you could wield (in bold) :

_____________________________________________

"The Iraq War has put us in more danger/has not made us any safer"

An absolute like this can be easily disproved by providing counterexamples.  So you can say :

"Well, we have not any attacks on US soil for 65 months and counting.  At the same time, other nations have experienced attacks during the same period, like in London, Madrid, Bali, Beslan in Russia, Mumbai, Jordan, Morocco, and Turkey.  All but two of these countries have not had troops in Iraq.  How do you explain that?"

This forces them to provide proof to support their belief, which is vastly more difficult to do given the lack of further attacks. 

_____________________________________________

"Saddam had no ties to 9/11"

It is true that Saddam had no participation in 9/11, which is why we dealt with the Taliban in Afghanistan first.  But the statement above implies an assumption that 9/11 was the only terrorist attack ever to occur against US citizens or US allies.  The way to corner your opponents is to test their knowledge of (or willingness to acknowledge) the numerous other terror attacks on US citizens before 9/11 (some of which received direct and indirect support from Saddam).

"Do you think 9/11 was the first terrorist attack ever?  Tell me what you know about the 1983 attacks in Lebanon that killed 241 Marines, the 1993 WTC bombing, the 1996 Khobar Towers bombing, the 1998 Kenya/Tanzania US Embassy bombings, and the 2000 USS Cole bombing.  I would like to see that you know about those."

The burden of demonstrating knowledge about the subject matter thus shifts to your opponent. 

_____________________________________________

"The Iraq War has gone on longer than World War II"

Not only is it ignorant to think WWII only started when America joined, but why should duration matter?  This is also red-handed proof of their scheme to only select comparisons that can make the Iraq War look bad.  A comparison of US casualties between WWII (300,000) and the Iraq War (2500) make Iraq look minor, so that comparison is simply not convenient to the fifth-column agenda (even though they trumpet casualties everywhere else).  Also note that the War in Afghanistan started before the War in Iraq, so a duration metric would imply that Afghanistan is even worse (despite only 300 US troops dying there in 5 years).  Thus :

"Afghanistan has been going on longer than Iraq.  Do you oppose the post-9/11 action in Afghanistan?"

Of course, they do oppose Afghanistan, but this exposes their anti-Americanism more readily.  They will retreat. 

_____________________________________________

"Bush lied about WMDs"

Of course, the facts are that Bill Clinton, Tony Blair, and 77 of 100 Senators (including Hillary Clinton, John Kerry, and John Edwards) all believed that Saddam had WMDs, particularly since he used them against the Kurds and Iranians before.  However, stating these facts in a debate will merely lead to a stalemate.  Instead, you can win by posing a 'what would you do if?' type of question : (see details on how to do this over here)

____________________________________________

"More Americans have died in Iraq than on 9/11"

Aren't these the same people who said Iraq had no ties to 9/11 (a statement which itself ignores all the terrorist attacks before 9/11)?  Plus, a tendency to lump non-hostile casualties into the Iraq casualty total exposes a sinister desire to inflate the total to be larger than it really is.  To date, 2521 US troops have died of hostile causes, and 590 of non-hostile causes.  To use the total (3121) itself is wrong. 

"I thought you believe Iraq had no ties to 9/11?  Why do you link the two only when you can find a way to portray Iraq negatively?  So are the two related, or not?"

and then proceed to ask :

"I am happy to inform you that the US hostile deaths are actually only 2521 (or whatever the number is at the time).  Why are you counting non-hostile deaths, like accidents, in the total?"

Also note how low the Iraq casualties truly are, relative to Vietnam, as per this striking graph. 

____________________________________________

"600,000 (or 1 million, or whatever) civilians have died in Iraq"

Bogus reports from non-credible sources have discovered that if natural deaths in Iraq are counted, they can fabricate a much larger tally of innocent deaths than the official Iraqi Government or even the UN estimate (15-30,000 a year).  By this measure, 3 million Americans died in 2006 alone, and 12 million (average age : 77) since the Iraq War began.  Oh the humanity!!

"Why are you taking a bogus number much larger than the UN estimate?  Is it only because you want to be able to blame the US, facts be damned?"

Plus, notice how they excuse the actual terrorists who are doing the killing.  Don't let that slide either.

"So by that measure, you should support US and British efforts to eliminate the terrorists who are doing the killing.  Why aren't you condemning the actual terrorists?"

_____________________________________________

You can also counterattack by widening the scope of the debate to corner them on their broader principles (which they certainly will not be proud to reveal).  This can be done with questions such as :

"We had had troops in Germany and Japan for 62 years, in South Korea for 54 years, and in Bosnia for 9 years.  Should we not remove those first?  Why are they not asking us to remove our troops?"

or

"I notice that people like you tend to always side against democracy.  Examples of this include your support of Hezbollah and Hamas against Israel, China against Taiwan, North Korea against South Korea, Cuba against the US, etc.  Why?"

An even simpler tactic is the expose the ignorance of the commenter by asking them a very simple, non-political question about Iraq, such as :

"Please name for me the countries that border Iraq, in clockwise order.  I need to see that you know where Iraq is on the map."

or

"What are the 3 main groups in Iraq, and what percentage of the population are each?"

or

"Name any 5 cities in Iraq.  One is Baghdad, I would like to see if you can name four others."

or

"What are the names of the President and Prime Minister of Iraq?"

You will be surprised how many fashion sheep will be unable to answer these general questions.  You have effectively destroyed any claim they have to act as an authority on the subject of Iraq.  Watching 10 minutes of MSNBC a day an expert does not make, and you should inform them of that. 

_____________________________________________

Now, for the final and most crucial segment of this article. 

I recognize that there is a sizable population of Americans, Democrats and Republicans, who support America, the troops, and the fight against terrorists, but are simply unhappy about how the Iraq War has been waged, or believe that other approaches might have been a better use of resources.  This is certainly a valid position to take, and one that I want to encourage.  Many on the Right make the mistake of not acknowledging this easily unnoticed groups of patriots, and thus lose potential allies against anti-American fifth-columnists. 

Instead, I would like to create a custom tool just for them, which they can use whether they are in the midst of anti-Americans, or are wrongly characterized by an Iraq War supporter. 

If you fall into this category, the best way for you carve out your own turf is to offer alternative ideas to help fight the War on Terror.  By doing what a fifth-columnist would never do, your patriotism is no longer in question.

For example, you could suggest that the US conduct an advertising/media campaign to reach out to the women of the Islamic world, and inform that they are just as deserving of the sametrights that women in other societies have.  This would cost a fraction of the Iraq War, and yet possibly be even more effective at undermining support for Al-Qaeda's ideology, perhaps tricking them into spewing even more over-the-top rhetoric.  This reframes the whole conflict as a women's rights issue, and could bring in new allies. 

This is a superb platform for the Democrats to construct.  If (in theory) Hillary Clinton aggressively pursued such an approach, I would even be happy with her as my President. 

There are endless possibilities for fresh new ideas in fighting the War on Terror.  Show everyone else your constructive ideas that would be more effective than the Iraq War, thus setting yourself apart from those who offer nothing.  I will always encourage you. 

Update : A great article from Dr. Sanity on the deeper pathology of the group in question.

Update : A quick video of Democrats agreeing with President Bush's strategy on Iraq, back when it was politically profitable to do so. 

Update : Christopher Hitchens is always concise and witty.

Related :

We Will Decisively Win in Iraq.....in 2008

Who Hates America?

Zarqawi and the Anti-American Fifth Column

North Korea and the Anti-Americans

India-China Growth Rate Comparison

The Economist has a cover story on India's recent acceleration in economic growth, and how irrational exuberance among excitable Indians has led to an unsustainable overheating and the risk of a correction. 

One chart that I have sought for years is a comparison of the historical growth rates between India and China.  This article had that chart, going back to 1974.  Both nations had pathetic growth between 1950 and 1970 (and were indeed even poorer than most African nations at the time).  Since 1980, however, China's lead over India has ranged from large to enormous, with India only (maybe) breaking away from the the 6% trendline now.  As a result, China has gone from being poorer than India in the 1970s to having over twice the per capita income today.  Even now, the narrowing of the gap is questionable at best, as India is amazingly unable to fully cash in on the democratic system that China lacks.   

What prevents India from making common-sense reforms and infrastructure upgrades that the rest of the world has been telling them about for decades?  India's cultural limitations are the primary reason - most of India's key politicians are over the age of 70 and hail from an era and ideology that produced little other than poverty, embarassment, and misery.  Their passing will remove the ideological glass ceiling that prevents further reforms in India.  When any country achieves faster economic growth, it is not just wealth that rises, but intellectual maturity, the quality and diversity of entertainment options, and safety rise as well.  People even become taller and better looking after a generation of economic growth.  I will write a much more colorful article on this subject in the future. 

Update : CNNMoney has an article that is somewhat harsher, but some of the author's statements are poorly reasoned.  Statements 'India has more HIV infected people than any other country' are meaningless unless taken as a percentage of the total population, in which India does not appear anywhere near the top of the list. 

Update 2 : BusinessWeek also has an article.

Related :

World GDP Grew 4.3% in 2005

The Biggest Event of the Last 15 Years : The Stunning Defeat of Socialism

New UN Human Development Data Released

The Futurist's Stock Portfolio for 2007

I am going to present an investment portfolio to be tracked over the remaining 11 months and 7 days of 2007 (I should have done this on Jan 1, but the idea of doing a post didn't arrive at a convenient time).  The hypothetical portfolio of $100,000 will be invested in exchange-traded securities and mutual funds that reflect what I believe to be an optimal portfolio construction for 2007.  We will, at the end of the period, see how the portfolio tracks the broader market.  Dividends will be re-invested. 

So the portfolio is :

 

Near misses (securities I did not add, but strongly considered) : FXI, GGP, PXN

The selections represent general principles and specific predictions outlined in the previously written articles :

The Next Big Thing in Entertainment, Part I, Part 2, and especially Part 3

The Culture of Success and Stock Market Capitalization in Developing Countries

The Stock Market is Exponentially Accelerating too

The World Wealth Report 2005

I herely sign and seal this portfolio on January 23, 2007, bought at the prices today, to be examined on December 31, 2007, in relation to broader market indices.

Let's see how it turns out. 

Ethanol Prices May Tumble Through Termite Digestion Discovery

When most people think of termites, the reaction is predictably negative.  After all, not only do they damage homes and bore holes through books, but they have a certain ugliness that even ants do not possess.  However, this is another one of those times where a particularly formidable and vexing problem of civilizational significance meets a countering force from just about the last source anyone would expect.  The loathed termite might actually attone for all the cumulative economic damage it has caused to human society over the centuries. 

Both MIT Technology Review and BusinessWeek have, in the last 30 days, featured articles detailing how a termite's ability to digest wood is due to certain microbes in the digestive tract, which contain a gene that can be extracted and harnessed into processes to create cellulostic ethanol out of agricultural waste for a fraction of the current cost. 

America's forests, agricultural waste, and 40 to 60 million acres of prairie grass could supply 100 billion gallons or more of fuel per year—while slashing greenhouse gas emissions. That would replace more than half the 150 billion gallons of gasoline now used annually, greatly reducing oil imports. It "will happen much faster than most people think," predicts Michigan State biochemical engineer Bruce E. Dale. "And it will be enormous, remaking our national energy policy and transforming agriculture."

Recent work has lowered the cost of this step thirtyfold, to about 50 cents per gallon of ethanol produced. "We now are not far away from the goal of 10 cents per gallon," says Glenn E. Nedwin, chief scientific officer at Dyadic.

Always remember that 1.5 units of ethanol are required to produce the same energy as 1 unit of gasoline.  So far, US ethanol production has amounted to merely 7 billion gallons (enough to replace just 3% of gasoline consumption) in 2006, is barely cost-competitive with gasoline even with the agricultural subsidies the federal government has provided, and is heavily dependent on using corn which is also needed in the food industry.  But if the termite enzyme can create a process that scales up to the extent of producing 100 billion gallons a year for under $1 per gallon (already a more modest goal than what the scientists in the article are striving for) out of otherwise unused biomass, we just might tackle oil dependence, greenhouse gas emissions, and the trade deficit simultaneously. 

The progress they make between now and 2010 will enable us to determine if this is on track to becoming a technological reality by 2015. 

Update : There may also be a way to create Ethanol from trash. 

Update : Algae may also be a large source of liquid biofuels that can compete with Ethanol. 

Related :

Why $70/barrel Oil is Good for America

$70+/barrel Oil, the Non-Crisis

The State of the Jihad

The Fourth Rail has a superb roundup of each of the dozen or so fronts that the global War on Terror is being waged.  I would argue that Lebanon and Britain/France should also be included.  Nonetheless, if you read just one article on this issue in one year, this should be that article.  Nowhere else has the global nature of the conflict been so efficiently encapsulated.

It is frightening that a person in the position that Nancy Pelosi is in actually believes that the War on Terror exists only in Afghanistan and nowhere else, as she said on 60 minutes. 

Overall, it appears that jihadists are losing ground in slightly more theatres than they are winning ground in.  This is a reason for cautious optimism. 

Plus, another good article is here : 

When the Bush administration came into office, only Egypt and Jordan were functioning allies of the U.S. Iran and Iraq were already declared enemies, Syria was hostile, and even its supposed friends in the Arabian peninsula were so disinclined to help that none did anything to oppose al Qaeda. Some actively helped it, while others knowingly allowed private funds to reach the terrorists whose declared aim was to kill Americans.

The Iraq war has indeed brought into existence a New Middle East, in which Arab Sunnis can no longer gleefully disregard American interests because they need help against the looming threat of Shiite supremacy, while in Iraq at the core of the Arab world, the Shia are allied with the U.S. What past imperial statesmen strove to achieve with much cunning and cynicism, the Bush administration has brought about accidentally. But the result is exactly the same.

Imagine that.

Related : VietNam or Korea, which was better in the long run?

New Astronomy Images, and Evidence of Telescopic Advances

I happened to come across this post, which displays the author's selections of the top astronomical photographs of 2006.  The one I am particularly stunned by is #5, the transit of the Space Shuttle and International Space Station in front of the Sun.  The precise timing needed to execute this image mind boggling, and probably less than one in a million.  The photographer, Thierry Legault, had to 1) know when the shuttle was approaching the ISS, 2) know when both of them would be in front of the sun relative to his location in France, which was a zone of observation only 7.4km wide, and 3) get this image in the 0.6 seconds of the transit duration.

Not all of these ten photographs are exclusively the result of instruments and technologies that did not exist a few years ago, but 3 to 4 of them are.  As we have discussed before, telescopic power is also an accelerating technology, and increasingly impressive images will continue to emerge as new telescopes and supporting resources become operational. 

Little can match an astronomical discovery's ability to generate wonder, optimism, and just a general good mood.  We shall see, within just the next couple decades, images that even the late Carl Sagan would have been in awe of. 

2006 Technology Breakthrough Roundup

The MIT Technology Review has compiled a convenient list of the most significant technological advances of 2006.

The Year in Information Technology

The Year in Energy : Plug-in cars, batteries, solar energy.

The Year in Biotechnology : A cure for blindness, and more.

The Year in Nanotechnology : Displays, sensors, and nanotube computers.

Most of the innovations in the articles above are in the laboratory phase, which means that about half will never progress enough to make it to market, and those that do will take 5 to 15 years to directly affect the lives of average people (remember that the laboratory-to-market transition period itself continues to shorten in most fields).  But each one of these breakthroughs has world-changing potential, and that there are so many fields advancing simultaneously guarantees a massive new wave of improvement to human lives. 

This scorching pace of innovation is entirely predictable, however.  To internalize the true rate of technological progress, one merely needs to appreciate :

The Milli, Micro, Nano, Pico curves

The Impact of Computing

The Accelerating Rate of Change

We are fortunate to live in an age when a single calendar year will invariably yield multiple technological breakthroughs, the details of which are easily accessible to laypeople.  In the 18th century, entire decades would pass without any observable technological improvements, and people knew that their children would experience a lifestyle identical to their own.  Today, we know with certainty that our lives in 2007 will have slight but distinct and numerous improvements in technological usage over 2006. 

Into the Future we continue, where 2007 awaits..