Traditional Industry & Nanotechnology

Like electricity and computing before it, nanotechnology will offer greatly improved efficiency in almost every facet of life. But as a general-purpose technology, it will be dual-use, meaning it will have many commercial uses and it also will have many military uses -- making far more powerful weapons and tools of surveillance. Thus, it represents not only wonderful benefits for humanity, but also grave risks.

Tomorrow we will discuss geopolitical implications, but first today we'll consider potential negative impacts on our current economic structure.

Josh Wolfe of Lux Capital, editor of the Forbes/Wolfe Nanotech Report, says, "Quite simply, the world is about to be rebuilt (and improved) from the atom up. That means tens of trillions of dollars to be spent on everything: clothing, food, cars, housing, medicine, the devices we use to communicate and recreate, the quality of the air we breathe, and the water we drink—all are about to undergo profound and fundamental change. And as a result, so will the socio and economic structure of the world. Nanotechnology will shake up just about every business on the planet."

Low-cost local manufacturing and duplication of designs could lead to economic upheaval, as major economic sectors contract or even collapse. To give one example, the global steel industry is worth over $700 billion. What will happen to the millions of jobs associated with that industry -- and to the capital supporting it -- when materials many times stronger than steel can be produced quickly and cheaply wherever they are needed?

Advanced nanotechnology could make solar power a realistic and preferable alternative to traditional energy sources. Around the world, individual energy consumers pay over $600 billion a year for utility bills and fuel supplies. Commercial and industrial use drives the figures higher still. When much of this spending can be permanently replaced with off-grid solar energy, many more jobs will be displaced.

The worldwide semiconductor industry produces annual billings of over $150 billion. The U.S. Bureau of Labor Statistics reports that the industry employs a domestic workforce of nearly 300,000 people. Additionally, U.S. retail distribution of electronics products amounts to almost $300 billion annually. All of these areas will be significantly impacted if customized electronics products can be produced at home for about dollar a pound, the likely cost of raw materials. If molecular manufacturing allows any individual to make products containing computing power a million times greater than today’s PCs, where will those jobs go?

Other nations will be affected as well. For example, the Chinese government may welcome the advent of exponential general-purpose molecular manufacturing for several reasons, including its potential to radically reduce poverty and reduce catastrophic environmental problems. But at the same time, China relies on foreign direct investment (FDI) of over $40 billion annually for much of its current economic strength. When those dollars to purchase Chinese manufactured goods stop flowing in, the required adjustments may not be easy and could result in violent struggles.

We’ve reviewed here the earthshaking impacts that molecular manufacturing is likely to have on business, investment, jobs, and, by extension, social stability. Geopolitical implications also must be considered. This technology may enable individual nations to achieve complete economic independence. Coupling that with the potential for rapid augmentation of offensive military power leads to the unsettling possibility of devastating warfare. That's tomorrow's topic.

Mike Treder

Comments

[Tom Craver]

MM eliminates most economic incentives to go to war. Possibly fossil fuel energy will still be an issue for the near term.

The biggest risk of war that local or individual economic independence creates, is that powerful elites will see themselves becoming less relevant, less powerful - and will inflate "foreign threats" as a way to cow their people into submission.

Religious, ethnic or racial "reasons" for war are really just examples of excuses blown out of proportion by and for the benefit of elites. Most people, if left alone and in reasonable prosperity, are happy to live their lives and not go out on quests to make people far away convert or die. (Locally may be another matter - but even there it is often elites who incite trouble.) It is those who can put other people's lives and welfare on the line without much risking their own, who see such activities as a good idea.

Seems to me that the best solution to that is not to use schemes that give the elite what they want, but to teach people to watch out for their "leaders" trying to pull such stunts. I don't know if that can work - people never seem to learn that their elites willfully induce fear and hate to get them to go along with their mad schemes. But I don't see any other way to prevent wars.

If international wars and eternal fear can be avoided, I would expect power to flow back toward individuals as most economy of scale benefits for production and distribution disappear. People are still social animals, so the minimum level of organization would be the clan or tribe. More likely the desire for coordination of larger scale activities will maintain all levels of government, merely weaker, as society is less dependent upon them.

[John B]

Per Tom, above, "MM eliminates most economic incentives to go to war."

Since when has war been considered in a rational, economic manner? The few times I know of when war was allegedly economical, it was based on false assumptions. (eg: some German and Japanese goals and plans in WWII)

However, I do agree that there may well be significant fear-mongering attempts by various power blocs in existance today to continue their power.

-John

[SonofEris]

That is very naive, John. There is almost always an agenda behind war - very often economic. It is planned and undertaken by groups with well laid-out agendas.

Certain business interests or international investment groups either backed one side or even both sides of the World Wars.

[John B]

Agreed, many businesses have historically profitted from wars, and many maintained profitability based on wartime roles for some time after hostilities had ended.

And I agree that there are almost always agendas driving wars, and that many of them are covered in a gloss of economics. However, basic economic principles include that people involved in economic activities are rationally following their own best interest.

Is it your position that these agendas are rationally arrived at? If so, I'd contest that point. My feeling (again, based on the little research I've done) is that they're based at least as much on wish fulfillment and prejudice as they are rational positions.

-John

[Tom Craver]

John
War isn't usually motivated by economic need - but has often been motivated by economic greed.

Is any war ever really necessary? I don't think so.

Yes, sometimes it is necessary to defend yourself - but was it necessary for your enemy to provoke the war? There are sometimes questions as to "who started it" - but usually the answer in those cases is 'both', and it always turns out to have been elites on one or both sides who started it.

[Tom Craver]

How did we get started raising a few people to elite status, where they can exploit the rest of us? Probably through hunting - where high skill kept the tribe alive and got elite hunters high status. Then some less skilled hunters desiring the same elite status started preying on other tribes. Soon elite war leaders were needed 'to defend us from enemies'. They found that if they didn't have a war every once in a while, they slowly lost elite status - so they arranged to have wars.

Since wars had to be paid for, and loot from wars divided, war leaders started making economic decisions, and found that was a way to channel more wealth to themselves, with people convinced they deserved it! Some proved better at conquering and at organizing their economies, and their tribes grew into kingdoms. Priests got and held power by creating the notion that a god or gods favored the ruler - the divine right of kings.

Finally, with the onset of market capitalism, we started moving in a better direction. Kings and nobles lost economic power to wealthy commoners. Religions were weakened by losing the support of the hereditary nobility. We still had elites - they just had to earn their positions of power by organizing our economic activities effectively. (Religion began backing the divine right of capitalist expansion in such nations.)

Desiring a way to translate economic power into political power (the means to arrange society to make it easier to gather wealth), capitalists hit on representative democracy. That innovation pretty much finished off hereditary nobility.

Communism and socialism attempted to eliminate capitalist elites, but they offered no alternative to having elite economic organizers - replacing capitalists with elite bureaucratic organizers slowly ruined their economies. Many who understand that still admire their egalitarian intentions and wish there was some way to make Communism work. I expect to see a "Nano-communism" movement, once the nanotech meme works its way from the engineering department over to the liberal arts department of universities.

[Tom Craver]

Once we get MM, why do we need elites any more? We won't need them to organize our economy to produce consumer goods. We'll have plenty of time to work on or lead large scale volunteer projects that we think we'll benefit from. If we could eliminate the power elite entirely, we wouldn't have anyone to push us into wars - so we wouldn't need elites to lead us to war! So why can't we stop having elites, and end war all together?

Unfortunately, we'll still have religions, and therefore religious elites who may hold belief systems that rationalize attacking others. Not just traditional religions - also environmentalists, transhumanists, evangelical Darwinists, libertarians, etc. We're developing into a democratic theocracy - where the most important political debates are not over economic regulations, but over what is morally allowable. [This may ultimately be the incentive that drives humanity off of Earth, much as established churches drove sects of Puritans out of Europe to America.]

[SonofEris]

John wrote:
"... basic economic principles include that people involved in economic activities are rationally following their own best interest."

Those involved in making money during wartime, via war and after it (from the contracts obtained for post-war reconstruction etc) are acting in their own interests through war. It's the rest of us who pay for it.

For the vast majority, it is not in their self-interest, but most economic activities are either seriously curtailed in the event of war, or come completely under government control.

Good point, Tom, about the 'Democratic Theocracy'. What is 'morally allowable' really does seem to be becoming the main focus of political debate.

Leaving the Earth, to find your own 'corner of the cosmos' to live according to your own beliefs and 'morals', ethics (or whatever) will look increasingly attractive to more and more people as the technology improves, long before we reach some version of molecular manufacturing capability.

[Michael Vassar]

Long before MNT? Son of Eris, just when do you imagine MNT developing? It's not clear that TODAY is "long before MNT".

[Karl Gallagher]

Tom asked:
So why can't we stop having elites?

Because we're primates who instinctively organize ourselves into hierarchies.

[SonofEris]

Michael writes: "Long before MNT? Son of Eris, just when do you imagine MNT developing? It's not clear that TODAY is "long before MNT"."

I don't know exactly when. I was merely saying that these issues of 'ethics', morals and personal freedom are going to increasingly become an important issue. It will need to be dealt within the next couple of decades simply due to a steadily increasing level of technology, without need of MNT to really force the issue.

I'm no expert, but judging from what I've read, I think it's realistically going to take longer for MNT to develop than is put forward by this site.

Karl writes: "So why can't we stop having elites?

Because we're primates who instinctively organize ourselves into hierarchies."

I do think we are force-educated, through the media and probably school, to believe we need elites. As thinking, rational (most of the time) beings we are capable of overcoming our biological programming so that alone, doesn't account for the continuing stratification of society.

[Chris Phoenix, CRN]

I'd like to try a new perspective on the elitism discussion. Can we look at it as a concentration of power--whether economic, military, or social power?

If we do that, the question becomes simple: "Is power rewarded for concentrating?"

Frequently, power is rewarded for concentrating. Especially in unstable situations where shortsighted strategy works. For example, if there's more of a resource available than is needed, then acquisition for its own sake will make you rich. (This may be relevant to the drive to monetize IP, much of which would be much more productive as a commons.)

In stable situations, an ecosystem model may work better. If expansion only leads to boom-and-bust, then the entities that limit their expansion will likely do better in the long run. A lot of predators have evolved to be quite restrained in their killing.

Think of the difference between clan and class societies. Clans, it seems to me, arise when resources are limited and travel is expensive. And their economics and sociologies are often based on zero-sum thinking: if someone starts to get rich, everyone else will pull him down. As a consequence, it could be hard to introduce capitalism into a clan society. I'd like to know how much of the difficulty in modernization in various areas can be traced to this social/historical factor.

In class societies, the elites always have several ways to improve their situation. They can destroy neighboring elites and take their resources. They can send their peons to war to relieve population pressure. In general, power makes it easier to get more power.

The development of technology seems likely to create unstable situations. Thus, I predict, concentrations of power will continue to exist. They may coalesce around a human, a corporation, or even something we're not familiar with yet.

Chris

[Michael Vassar]

Here's an interesting article on clans and weak property rights.

http://www.nytimes.com/2005/01/19/opinion/19kris.html?oref=login&n=Top%2fOpinion%2fEditorials%20and%20Op%2dEd%2fOp%2dEd%2fColumnists%2fNicholas%20D%20Kristof

[John B]

Chris, I think you got things backwards in the first part of your post above. You don't get rich buying surplus, but rather buying scarce stuff and selling to an undersupplied demand.

Another example of concentration working (at least in the short term) is a monopoly. Most likely will end up boosting the use of other goods/services as people work around the monopoly if prices are perceived as unreasonable, however - so you can soak people for a (relatively) short period or set up for long-term small profits.

Yet another is government.

As for your clan versus class debate, I don't know that the situation is anywhere near as clearly defined. Good for archetypical debate, but there are plenty of clans that have what you label as a class relationship (many modern African nations are the examples in my head). I can't think of a class situation that acts as you define clans, however.

-John

[Karl Gallagher]

Chris, the best take I've seen on that issue is Nonzero by Robert Wright. Some sample chapters are up on http://www.nonzero.org

[Chris Phoenix, CRN]

John, by "resource" I didn't mean something you'd turn around and sell, but something you could convert into something else that was saleable. Surplus sale goods are obviously not useful. Extremely cheap raw materials may be.

Chris