A lot of people fear new technology, deeply. They fear for their jobs, their privacy, their security and the sociability of their screen addicted children.
This emotion can seriously disrupt the rollout of new tech. The luddites are the textbook example. They destroyed machinery in cotton and wool mills to protest losing their jobs between 1811 and 1816. And gave their namesake to tech sceptics ever since.
But I’ve never understood the nature of the luddites’ arguments. All the evidence says technology and unemployment are inversely correlated. New tech creates jobs, it doesn’t destroy them.
The Industrial Revolution the luddites were up in arms against created so many jobs that cities became possible and the population exploded.
If tech and unemployment were correlated then we’d all be unemployed by now and the Japanese would’ve suffered disastrous unemployment levels during their boom. But the opposite happened.
The luddite’s mistake is simple. They assume the number of jobs is fixed and allocated. Lose yours and you’re out.
But the number of jobs is infinite. There’s always more to do. The only question is whether it’s worth doing. And tech makes production cheaper, which means more stuff becomes worth doing. This leads to more jobs and more wealth.
But what about other tech fears? Did you know the Nerekhta of Kungas is coming for you, for example?
Source: Popular Science
Russia’s new robotic war machines don’t have anyone inside. And they’re built for all sorts of tasks.
In the future, robots will rule our battlefields. Terminator will be real.
Unless we stop them…
I don’t understand this sort of anti-tech argument much either. While the potential for an exchange of civilisation ending warheads is on the cards, warfare can only escalate in a limited way. Beyond which robots doing the fighting doesn’t really matter.
I’d much rather have robots trying to blow each other up than humans. Maybe we’ll return to the good old days where soldiers fought each other on a field and left the rest of us alone. Only this time it’d be robots on the field.
Robots are significantly less likely to go rogue than humans, I suspect. They don’t have the emotions that make humans so dangerous. Nor the needs…
The luddites and robot worriers aren’t making headline news at the moment. Right now, it’s the nationalists who hold sway in the tech debate. China’s Huawei wants to roll out 5G tech around the world. Western countries aren’t so sure that’s a good idea.
I used to be sceptical about this anti-tech argument too. If foreign companies want to build our infrastructure for us, they should be encouraged. At slightest sign of anything shifty going on, you simply take it off them.
But that might be a little simplistic given what can be built into sophisticated tech. Poison pills or back door access, for example.
Still, if the Chinese want to pay to set up our 5G infrastructure, as long as this infrastructure doesn’t have inbuilt problems, I don’t see the problem.
So far, we’ve reviewed why the various anti-tech arguments are on thin ice. But why do you care?
The march of history also teaches us that the luddites and nationalists never win. For a simple reason. Their pitch leaves them behind.
Without embracing new tech, you eventually underperform those who do. This applies to nations, companies and people. Communism and isolationism fail for the same reason. People want the solutions tech provides.
This means that any attempt to retard technological advances creates an opportunity for investors. A politically beaten down technologically advanced asset that will succeed in the end is worth investing in.
Nuclear power is a good example right now. It’s deeply unpopular and the luddites are firmly against it. But it may prove too good to resist once those people get their power bill. Nations that use nuclear will have too much of an advantage over those who don’t.
The best example is of course 5G – your current opportunity to win from the tech wars.
The world is desperate for 5G. But politics over who will provide the infrastructure is holding us back.
Not all of us. Just look at who is rolling out commercial 5G already. Chile, China, Turkey, UAE, Argentina, and Mexico are alongside South Korea. Those aren’t exactly innovation heavy nations compared to South Korea. But they’re willing to sacrifice state control over the infrastructure for the benefits of innovation.
And then there’s a question of performance. 5G is all about speed of data, but the key is reliability and connectivity. A self-driving car that can’t go because of a lack of connectivity is a bit of a dud…
If Huawei is better, then those nations which exclude it will miss out on the benefits.
5G infrastructure is only half of what makes those benefits possible, of course. All our devices have to be able to connect to 5G too.
Until next time,
Editor, Exponential Investor