The Lights in the Tunnel Automation Accelerating Technology and the Economy of the Future_2 ppt

THE LIGHTS IN THE TUNNEL / 18

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erallyproduce onlyverydimlights. Inthirdworld coun-
trieswithlittleornosafetynet,theseunluckypeoplewill
likelybecastoutfromthetunnel,andtheirlightwilldis-
appearentirely.
Theimpactofautomationisstillverydifficulttodis-
cernamongthemultitudeoflightsinthetunnel.Weno-
tice,however,thatsomeofthebrightestlightsinthetun-
nel are beginning to shine with even more intensity. As
jobsareeliminated,many ofthebusinessesinthetunnel
becomemoreprofitable.Someofthiswealthisthentrans-
ferredtotheownersandtopexecutivesofthebusinesses.
Asthisprocesscontinues,weseethebrighterlightscon-
tinuetoslowlygainstrengthasmoreoftheaveragelights
graduallydimorflickerout.Thedistributionofincomeis
becomingmoreconcentratedinthetunnel.
Now,finally,webegintoseearealdifferenceinthe
tunnel.Itbecomesobviousthattherearefewerlightsand
thatthenumberiscontinuingtodiminish.Justasthisrea-
lizationstrikesus,weimmediatelyfeelthatthereisanew
senseofurgencypervadingthepanelsthatlinethewallsof
thetunnel.Thepanelsbegintodancewithmoreandmore
desperatemotionandcolorastheyattempttoattractthe
dwindlingnumberoflights.
The businesses on the walls of the tunnel are now
suddenly seeing significantly slower demand for their
products and services. This is happening even though
manyofthebrightestlightsinthetunnelhavecontinued
togaininstrength.

Imagine that your job is to sell as many $50 cell
phones as you can in one hour. You are offered two
The Tunnel / 19

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doors:Behinddoor# 1sitBillGatesandWarrenBuffet,
thetworichestpeopleinAmerica.Behinddoor# 2area
thousand average people. You may well be tempted to
choose the first door just so you’ll get to meet Bill and
Warren,butintermsofgettingyourjobdone,youwould
probablyagreethatdoor# 2isclearlythebestchoice.This
isbecausethedemandforthemassmarketproductsthat
driveoureconomydependmuch moreonthenumber of
potential customers than on the wealth of any particular
customer. You are not going to be able to sell 40 cell
phonestooneperson,nomatterhowwealthytheyare.
Wecannowsensethatmanyofthebusinessesinthe
tunnelareclearlyintrouble.Eventhoughtheyarecontin-
uingtosavemoneyasautomationslowlyeliminatessome
oftheirremainingworkers,thisisnotenoughtomakeup
forthereductionin salestheyareexperiencing.Manyof
these companies are now at the point where they must
takeactiontosurvive.
Agreatdealofeachcompany’sresourcesisinvested
in factories, machines and equipment and offices. These
things, whichan economistmight referto as capital, are
very hard to quickly get rid of. For example, if you just
boughtalotofnewautomatedmachinesforyourfactory,
thenyouarestuckwiththem.Youcan’tjustreturnthem
and get your money back if demand for your products

suddenly starts to fall. For this reason, a business which
seesrapidlyfallingdemandusuallyhasonlyonechoicein
ordertosurvive:cutmorejobs.Weseethis,ofcourse,as
partofthenormalbusinesscycle.Businessesroutinelylay
offworkersinbadtimesandthenrehireingoodtimes.
THE LIGHTS IN THE TUNNEL / 20

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Inthetunnel,wenowseethatthebusinessesarebe-
ginning to cut more and more jobs. They are becoming
more desperate and, in many cases, they must eliminate
evenkeyemployeesthattheyformerlyfeltwerecrucialto
theiroperations.Asthishappens,webegintoseesomeof
thebrighterlightsinthetunnelrapidlybegintodim.
The continuing decrease in demand falls especially
heavilyonthemanufacturingbusinesseslocatedindevel-
opingnationslikeChina.Thesebusinessesrelyonproduc-
ingveryhighvolumeproducts,whichtheyexporttofirst
worldnations.Theyarenowseverelycuttingjobsandthe
flowofnewmiddleclasspeopleintothetunnelhasallbut
stopped.
As a result of the job cuts, the lights are becoming
evenmoresparseinthetunnel.Manyofthebusinessesare
now failing and whole regions of the tunnel walls are
growingdark.Nowweseethatmanyoftheverybrightest
lightsinthetunnelfinallyfeeltheimpactandalsobeginto
losetheirlight.Theownersofthebusinessesinthetunnel
areseeingmuchoftheirwealthgraduallydrainaway.
The tunnelhas becomea far darker and more stag-
nant place. We sense clearly that the hopes of even the

remainingbrighterlightsaregraduallyevaporatingintothe
newemptinessofthetunnel.
The Tunnel / 21

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A Reality Check
Clearly,oursimulationdidnotturnoutwell.Perhapsour
initialassumptionaboutjobsbeingautomatedwaswrong.
But, again, let’s leave that for the next chapter. In the
meantime, we might wonder if we have made a mistake
somewhereinthesimulation.Let’sseeifwecanperform
sometypeof“realitycheck”onourresult.Perhapswecan
looktohistorytoseeifthereisanythinginthepastthat
mightsupportwhatwesawhappeninoursimulation.
Let’sleaveourtunnelandtravelbackintimetothe
year 1860. Inthe southern part ofthe United States, we
knowwillfindthegreatestinjusticeeverperpetratedinthe
historyofournation.Here,longbeforethenewlightof
advancedtechnologyfirstbegantoshine,menhaddiscov-
eredafarmoreprimitiveandperverseformofjobauto-
mation.
The injustice and moral outrage associated with sla-
veryrightlyattractsnearlyallofourattention.Forthisrea-
son, most of us don’t have occasion to think about the
overall economic impact of slavery. At the time Abraham
Lincoln was elected president, we know that while the
Northern population’s moral objection to slavery was a
primary divisive issue, there were also significant differ-
ences and debate about issues relating to the differing
economicsystemsoftheNorthandtheSouth.

The Northern economy was built on free labor and
entrepreneurshipandtendedtospreadopportunitymore
equallythroughoutthepopulation.Incontrast,theSouth-
ernstates relied onslavelabor, andwealthwasprimarily
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concentratedinthehandsofwhiteplantationownerswho
ownedmanyslaves.Oneresultofthissystemwasthatit
wasveryhardforpoorerwhitestoadvancetheirsituation
becauserelativelyfewfreelaboropportunitieswereavaila-
ble.
Documentedobservationsillustratetheimpactofsla-
veryontheSoutherneconomy.InherbookTeamofRivals:
The Political Genius of Abraham Lincoln, Doris Kearns
Goodwin describes a journey that William Seward, who
would years later become Lincoln’s Secretary of State,
took in 1835. Seward traveled with his family from his
homeinNewYorkStatetotheslavestateofVirginia.
5
As
theSewardscrossintoVirginiatheyleavebehindthebus-
tling towns and cities to which they had become accus-
tomed. Instead, they travel a rough, deserted road with
fewhomes,businessesortaverns.Dilapidatedshacksdot
thelandscape,andthelanditselfseemstohavebeenas-
saultedbypoverty.Duringhisjourney,Sewardobserved:
“How deeply the curse of slavery is set upon this vene-
rated and storied regionof theold dominion. Of all the
countriesIhaveseenFranceonlywhoseenergieshavefor

forty years been expended in war and whose population
hasbeenmoredecimatedbytheswordisasmuchdecayed
asVirginia.”
6

Itseemsclearthattherearesomedefiniteparallelsbe-
tweenwhatwesawinoursimulationandtheslaveecon-
omy in the South. We noticed that in our tunnel, the
brightestlightsinitiallybecameevenbrighterastheaver-
agelightsbegantodimandflickerout.Thisfitswellwith
thefactthatmostwealthintheSouthwasconcentratedin
The Tunnel / 23

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thehandsofrichplantationowners,whilethemajorityof
thepopulationwastrappedinpoverty.
Thereisoneimportantdiscrepancy,however.Inour
simulation, the situation continued to deteriorate until
even the brightest lights eventually began to lose their
strength.Incontrast,slaveryintheSouthernstateslasted
forovertwo hundredyears.Theplantationowners were
abletoholdontotheirwealthatleastuntilthestartofthe
CivilWarin1861.Ifoursimulationseemstoindicatethat
aslave(orautomation-based)economyisdestinedtoun-
dergo continuing decline, how is it that the slave states
wereabletomaintainstabilityforsolong?
TheanswerliesinthefactthattheSouthwasprimari-
lyanexporteconomy.Thelargeplantationsproducedraw
cotton which was then shipped to Europe and to the
Northern states where it was manufactured into textiles

andclothing.Itwasthisconstantwealthflowinginfrom
the outside that was able to maintain the economy over
time.
Our simulation, of course, was of the entire world
mass market, so there was obviously no export market
available. In the simulation, we found that across-the-
boardautomationofjobseventuallyreduceddemandfor
productsandservicesasthenumberoflightsinthetunnel
decreased. You can imagine that, if the South had been
completely isolated economically with no outside trade
allowed, it would likely have followed a path of decline
similartotheonewesawinthesimulation.
Infact,oneofPresidentLincoln’sfirstactsafterthe
SouthernstatessecededfromtheUnionwastoimplement
THE LIGHTS IN THE TUNNEL / 24

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acompleteblockadeoftheSouth.The blockadebecame
increasingly effective as the years progressed—ultimately
achieving a 95 percent reduction in Southern cotton ex-
ports—and was certainlyan important factor in the out-
comeofthewar.Bythetimethewarendedin1865,the
Southerneconomywasincompleteruin.Onecanspecu-
latethatiftheblockadecouldhavebeenmaintainedwith-
outanactualshootingwartakingplace,theeconomicim-
pactalonemighthaveintimeledtotheendofslavery.
*

Summarizing
Both our tunnel simulation and our examination of the

Southern slave economy seem to support the idea that
oncefullautomationpenetratesthejobmarkettoasub-
stantial degree, an economy driven by mass-market pro-
duction must ultimately go into decline. The reason for
this is simply that, when we consider the market as a
whole, the peoplewho rely onjobs fortheirincome are
thesameindividualswhobuytheproductsproduced.
Anotherwayofexpressingthisistosaythatalthough
machines may take over people’s jobs, the machines—
unlesswearereallygoingtojumpintothestuffofscience


*
Isitreallyreasonabletodrawacomparisonbetweentheeconomic
effects of slaveryand advanced machine automation? I would argue
that the comparison almost certainly underestimates the economic im-
pactofautonomousmachines.Becauseofitsinhumanity,slaverycar-
rieswithitobviouscosts.Theseincludeboththedirectcostsofen-
slavingunwillinghumanbeingsaswellaslostproductivity.Theown-
ersofmachineswould,ofcourse,seenoneofthesecosts.Inaddition,
machines,whichcanoperateessentiallycontinuously,obviouslyhave
the potential to be far more productive than even a willing human
workercouldbe.
The Tunnel / 25

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fiction—do not participate in the market as consumers.
Recallfromourexampleofsellingcellphonestothetwo
billionairesortoathousandregularpeople,thatmakinga
fewpeoplericherwillnotmakeupforlosingalargenum-

berofpotentialcustomers.Thatmayworkforyachtsand
Ferrarisbutnotforthemassproducedproductsandser-
vicesthatarethebackboneofoureconomy.
Attheverybeginningoftheautomationprocessthis
effectwasnotatallclear.Thefirstbusinessestoautomate
sawasignificantreductionintheircostsastheycutwork-
ers, while the impact on the demand for their products
was negligible—orin fact,demand mayhaveactuallyin-
creasedforatime,astheywereabletolowertheirprices.
Asaresult,theirprofits,andthereforethewealthoftheir
topemployeesandshareholdersincreased.Thesewerethe
brighterlightsinthetunnelthatinitiallybecamestronger.
However,asnearlyallbusinessesinthetunnelcontinued
toautomatejobs,atsomepointthedecreaseinthenum-
berofpotentialcustomersbeganto outweightheadvan-
tagesgainedfromautomation.Oncethishappened,busi-
nesseswereforcedtocutevenmorejobs,whicheliminat-
edevenmoreconsumersfromthemarketandcausedde-
mandtofallstillfurther.Fromthispointon,theeconomy
enteredacontinuingdownwardspiral.
Nota veryhappy ending. However,we still needto
examineourinitialassumption.Isitreallypossiblethat,at
some point in the future, machines or computers could
takeoverthejobsperformedbyalargepercentageofav-
erage workers without new jobs within the capability of
thesepeoplebeingcreated?Couldthatreallyhappen?
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We’lllookatthatquestioninthenextchapter.We’ll

alsolookatsomethingcalledtheLudditefallacy—whichis
an established line of economic reasoning that strongly
contradictstheresultwesawinoursimulation.

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Paperback/Kindle available @ Amazon


Chapter 2
ACCELERATION


Let’snowturntothequestionofwhetherornottheas-
sumptionwemadeaboutjobsbeingautomatedinthefu-
ture is a reasonable one. It might be helpful to start by
turningthatassumptioninsideoutandlookingatitscon-
verse.Ifyoubelievetheassumptionwemadeisincorrect,
thenyoumustbelievethat:
Technology will never
 advance to the point where the bulk of jobs
performedbytypicalpeoplewillbeautomated.Theeconomywillal-
wayscreatejobsthatarewithinthecapabilitiesofthevastmajorityof
thehumanpopulation.
When you look at things this way, you might see
some cause forconcern. The real problem, ofcourse,is
that one offending word: “never.” Never is a very long
time:itisthreehundredoraevenathousandyears.Never
is,well,forever.
Tomakethingsmorereasonable,let’slowerthestan-
dardsomewhat.Let’sthinkintermsofourownlifetimes

or the livesof ourchildren. Thatshould make theissue
much more approachable and personal. After all, surely
noneofuswouldwantsomethingdramaticallynegativeto
THE LIGHTS IN THE TUNNEL / 28

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happenduring thelives ofour own children,even ifwe
weren’taroundtoseeit.
With that standard in mind, let’s just assume a rea-
sonableaveragelifespanof80yearsforababyborntoday.
That gives us the year 2089 as a cutoff date. So the as-
sumptionthatwewanttotestnowbecomes:
Technologywillnotadvancetothepointwherethebulkofjobsper-
formed by typical people will be automated before the year 2089.
Priortothatyear,theeconomywillalwayscreatejobsthatarewithin
thecapabilitiesofthevastmajorityofthehumanpopulation.
Canwebankonthat?
The Rich Get Richer
Nearlyallof us sense that our worldis changing rapidly
and that perhaps things seem to be speeding up. We’ve
become accustomed especially to continuous improve-
ment in technology. Wenotice that thelaptop computer
we buy today is dramatically fasterand lighter and more
feature-packed that the one we bought just a few years
ago,andyetitcostsless.Ournewcellphoneissmalleror
lighter,butitdoesmore.
As human beings, we are geared toward thinking in
termsofconstantmotionorgradualchange.Wetendto
analyzethingsintermsofstraightlines.Forthemostpart,
thisishowthephysicalworldaroundusworks.

Weare,ofcourse,familiarwiththeconceptofaccele-
ration.Weexperienceitwhiledrivingorwhenanairplane
takesoff.Butinthecourseofourdailylives,acceleration
is—almost without exception—something that isofvery
Acceleration / 29

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short duration: something typically limited to seconds.
Perhapsforthisreason,itisnoteasyforustoreallycom-
prehendtheideaofan accelerationthatcontinuesrelen-
tlessly for decades. It is difficult for us to really get our
mindsaroundtheimplicationsofthis.
In1965, Gordon E.Moore,theco-founderof Intel
Corporation,observedthat,asaresultofconstantinnova-
tion, thenumberof transistors onasiliconchip roughly
doubled at a consistent pace. Moore speculated that the
rateofgrowthwouldcontinueintotheforeseeablefuture,
andintheyearssince,hisforecasthasproventobecor-
rect.Moore’sobservationinitiallyrelatedto thenutsand
bolts of how chips are fabricated, but over time it has
evolvedintoabroaderruleofthumbthatgivesusauseful
frameworkforthinkingabouthowourabilitytomanipu-
lateandprocessinformationincreasesovertime.Thisrule
ofthumbhasbecomeknownasMoore’sLaw,
*
anditcanbe
expressedasfollows:
Astechnologyprogresses,thecomputationalcapabilityofacomputer
willroughlydoubleeverytwoyears.
Moore’s Law is, of course, not a “law” at all—

certainlynotinthesensethatphysicalrulesliketheones
postulated by Isaac Newton are laws. It is, however, an
accurateobservation andprojection, andnearlyeveryone
inthetechnologyfieldacceptsit.Moore’sLawisanover-
all estimate. Different facets of technology, in fact,
progressatdifferentrates.Still,wecanprobablyagreethat


*
SomeversionsofMoore’sLawuse18monthsratherthan2yearsas
thedoublingstandard.Ihavechosenthemoreconservativenumber.
THE LIGHTS IN THE TUNNEL / 30

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itisourexpandingabilitytomanipulateandcommunicate
informationthatisthedrivingforcebehindthetechnical
innovationweseeallaroundus—andMoore’sLawdoes
anespeciallygoodjobofcapturingtherateofprogressin
thatarena.
When something doubles at a regular pace, we say
thatitgrowsgeometrically,orexponentially.
*
Toillustratethe
extraordinaryaccelerationthat thisimplies,imagine start-
ingwithapennyandthendoublingtheamountyouhave
everydayforamonth.You beginwithonecent; onthe
seconddayyouhavetwocentsandthenfourcentsonthe
thirdday,andsoon.
Thefirstchartonthenextpageshowsthefirstfifteen
daysasourpennydoubles.Youcanseethatwestartout

very slowlyand then begin to accelerate.On dayfifteen,
we have about $164—which is not bad at all since we
startedwithonlyapenny!
Inournextchart,welookatdays15-30.Nowwe’ve
hadtogreatlyexpandthescaleofourbarchartsowecan
accommodate some very big numbers toward the end.
Youcanseethatwestartwhereweleftoffwith$164,but
nowthisamountissotinyagainstournewscalethatwe
don’tevenseeavisiblebar.Wehavetowaituntilday22
before we see a hint of progress—but still that amount
representsnearly21thousanddollars.
Thingsreallystarttoflyfromthere.Wepassthemil-
lion-dollarmarkatday28andenduponday30withover
fivemilliondollars.Notbadforamonth’swork.Ifwehad


*
Thesetermshaveslightly differenttechnical meanings,butforour
purposestheyareinterchangeable.
Acceleration / 31

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

















been lucky enough to choose a month with 31 days for
ourexperiment,wewouldhavenearlyelevenmilliondol-
lars to show forit. If we couldcontinuethe process for
another thirty days, we would have an astonishing
$5,764,607,523,034,235—ornearlysixquadrilliondollars!
Asyou cansee,a geometricor exponentialprogres-
sionisreallytheultimatecaseof“therichgetricher.”The
moreyouhave,themoreyouget,anditjustkeepsgoing.
When we compare this with the more routine things we
encounter in life, the contrast is astonishing. Consider
economicgrowth,orperhapstheraiseyoumighthopeto
getatwork;inthesethings,wearehappytoseeagainofa
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fewpercentage points. Canthisbereal?Isthecomputa-
tionalcapabilityofcomputersreallyexpandingthatfast?
Toillustratethatthisisindeedthecase,letmeusean
examplefrommyownexperience.In1981,Ienteredthe
UniversityofMichiganasafreshmanwithplanstostudy
computer engineering.Computer engineering was then a

new discipline just introduced at Michigan and at a few
other universities. Up until then, no one had been quite
surethatcomputerswereimportantenoughtomerittheir
ownengineeringfield.
TheUniversityofMichiganhadoneofthemostad-
vanced computing centers in thecountry. Thecomputer
then in use was a state-of-the-art mainframe machine
manufactured by the Amdahl Corporation. In my first
computerprogrammingcourse,wewereassignedthetask
ofwritingandrunningaprogramusingcomputerpunch
cards.
7

Todothis,youfirstwenttotheuniversitybookstore
and purchased a large box of blank punch cards. These
were similar to, but a little longer than, standard index
cards.
Youthenwroteyourprogramusingpencilandpaper,
andtookyourblankcardstoacardpunchmachineatthe
computing center. You inserted a blank card in the ma-
chineandentered,or“keyedin,”onelinefromyourpro-
gram.Asyoudidthis,themachinepunchedcorrespond-
ing holes in the card. You repeated this for each line in
your program. If you madea mistake,youhad to throw
the entire card away and start over. For a complex pro-
gram,youmighthavetopunchhundredsofcards.
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Next,beingverycarefulnottoscrambleordropthe

stackof cards, you took them toa card reader machine.
Youfedthestackofcardsintothemachineandyourpro-
gramwasenteredintoalonglineofotherprogramswait-
ingfortheattentionofthecomputer.
After a time, in some cases hours, you went to the
print centerandretrievedapaperprintoutoftheresults.
Sinceitisvirtuallyimpossibletowrite aperfectprogram
the first (or usually even second) time, you had to go
through this process several times until you found and
fixedthe“bugs”inyourprogram.
Obviously,thewaywewithinteract withcomputers
haschangeddramatically.Ihadtoincludeadescriptionof
punchcardsaboveforthebenefitofyoungerreaderswho
maynothaveseenthese.Whataboutthecomputeritself?
The mainframe in use at Michigan then was an Amdahl
470/V8.Thiswasamachinethatprobablyoccupiedasig-
nificant portion of a room and cost somewhere in the
neighborhoodoftwomilliondollars.
In order tocompare the relative speeds of different
computers, engineers have developed a measurement
known as Millions of Instructions per Second, or MIPS.
TheMIPSratingofacomputerisabitlikethehorsepow-
erratingofanengine.Whileeachcomputerhasaunique
design,MIPSratingsgiveusausefulwaytomakerough
comparisons.
If you imagine a software program running on a
computer to be similar to someone playing a tune on a
piano, then each computerinstructionwouldcorrespond
toonestrikeofthepianokeys.TheAmdahlmainframeat
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Michiganhad a rating ofabout seven MIPS.
8
 So wecan
thinkofourpianoplayerrippingalongatsevenmillionkeys-
trokespersecond.Obviously,thatisaveryfastpianoplay-
er,andatthetime,itwasprettygoodforacomputer.
By the time I graduated from Michigan in 1985,
thingsoncampushadchangedagreatdeal.Theyearbe-
fore, Apple Computer had released the MacIntosh. The
MacIntoshand its predecessor, the Apple Lisa, werethe
firstcommerciallyavailablepersonalcomputerstohavea
graphical interfaceand a mouse.Theuniversity had pur-
chaseddozensofthesenewcomputers,andstudentswere
now using them in their courses rather than the main-
frame.
The original MacIntosh ran at about one MIPS.
9
 In
otherwords,itwasabout1/7asfastastheAmdahlmain-
frame.Thatseemedquiteimpressive.Afterall,theMacIn-
tosh was this tiny thing that sat onyour desk, while the
Amdahlwasa$2millionbehemoththatrequireditsown
room.
Now let’slookathow things progressed afterI left
college:
 By1988,Intel’s386DXprocessorwasrunningat
8.5 MIPS. This microprocessor was used in the
firstIBMPC’sthatcouldrunearlyversionsMicro-

softWindows.Thusadesktopcomputerhadnow
exceededthespeedoftheAmdahlmainframe.
 By1992,Intel’s486DXran at about54MIPS or
nearly eight times the speed of the old Amdahl
mainframe. 486-based PC’s were the first ma-
chinestoreally provideausefulplatformfor Mi-
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crosoftWindows.Windows3.1,alsointroducedin
1992, became an enormous commercial success
forMicrosoft.
 By 1999, theIntel Pentium III was rated at over
1,300MIPS.Ourpianoplayerisnowgoingatover
a billion keystrokes per second. This is close to
200timesthespeedoftheoldAmdahl.
 In 2008, an Intel Core 2 Extreme processor was
ratedatupto59,000MIPS.That’s59billionpiano
keystrokes per second and over 8000 times the
speed of our 1981-vintage $2 million Amdahl
mainframe.
Obviously, things have progressed very impressively
overthe 24or so years since I leftcollege. What weare
more interested in, however, is what will happen in the
future.
WeknowfromMoore’sLawthatcomputersarepro-
gressingatageometricora“richgetricher”ratewherewe
doublewhatwealreadyhaveeverytwoyears.Inthefirst
chapter,Iusedanexamplewherewethoughtaboutselling
cellphonestoBillGatesandWarrenBuffet.Let’sdragBill

backintothestorynowandperformanexperimentthat
mightgiveusanideaoftheleveloffutureprogressthat
wecanexpect.
BillGatesleftHarvardin1975tomovetoNewMex-
icoandfoundMicrosoftalongwithhispartnerPaulAllen.
Wecanmarkthat dateasbeingessentiallythe beginning
ofthepersonalcomputerindustry.AsBillstartsworkin
1975,let’simaginethatweslipourmagicpennyintohis
pocket.Bill’sfocusedonotherthings,andhewon’tnotice.
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We’lldoublethepennyeverytwoyearsandseehowmuch
Billendsupwith:
 The IBM PC, which uses Microsoft’s MS-DOS
software, isintroduced in August 1981. This sets
Microsoftonitspathtosuccess.Billnowhaseight
centsinhispocket.
 InMarch1986,Microsoftgoespublicanditsstock
tradesforthefirsttimeontheNASDAQmarket.
Billhasabout45cents.
10

 Windows 3.1 is introduced in 1992. For the first
time,Microsoft beganto offer some competition
toApple’sMacIntosh.Billnowhasabout$3.60in
hispocket.
 WindowsXPisintroducedin2001.Billhasabout
$82.
Let’szoomforwardto2009andlookinBill’spocket:

about$1,300.Obviously,it’sa good thingBilldidn’tpin
hisfortunesonourmagicpenny.
ConsidereverythingthatBillGateshasaccomplished
overhiscareer.HebuiltMicrosoftintotheworld’sdomi-
nantsoftwarecompanyandhasnowretiredfromfulltime
workatthecompanytorunhischaritablefoundation.Af-
ter all that, in terms of our experiment to measure the
geometric acceleration of technology, Bill has less than
1,500 dollars.However,we canalsoseethat thingshave
accelerated quite dramatically in the years between 2001
and2009:injusteightyears,Billhasgainedover$1,200,
comparedwithagainofonly$82overthe26yearsleading
upto2001.
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We know from the charts we looked at earlier that
Billwilleventuallyreachthemilliondollarmark.Whatcan
wesayaboutthefuture?
 In2015,Billwillhaveabout$10,500oreighttimes
whathehasin2009.
 In2021,Bill willhavenearly$84,000or64 times
the2009figure.
 In 2025, Bill will have almost $336,000 or about
258timeswhathehasin2009.
 In2031,Billbecomes amulti-millionaire. Hewill
have2.6milliondollarsor2000timeswhathehas
in2009.
Looking at these numbers, we can see that unless
technicalprogressslowssignificantly,computersaregoing

to get dramatically more powerful by 2031. That date is
nearly60yearsbeforethecutoffdateof2089thatweset
atthebeginningofthischapter.
WhatwouldBillhavein2089?1.4quadrilliondollars.
Thisisoveronetrilliontimesthe2009amountof$1,300!
Thesenumbersshouldgiveyouasenseoftheincred-
ible degree of technological acceleration we can expect
overthecomingyearsanddecades.Asfuturistandinven-
tor Ray Kurzweil writes, “Exponential [or geometric]
growthisdeceptive.Itstartsoutalmostimperceptiblyand
explodeswithunexpectedfury.”
11

HowconfidentcanwebethatMoore’sLawwillcon-
tinuetobesustainablein thecomingyears anddecades?
Evidencesuggeststhatitislikelytoholdtrueforthefore-
seeable future. At some point, current technologies will
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runintoafundamentallimitasthetransistorsoncomput-
erchipsarereducedinsizeuntiltheyapproachthesizeof
individual molecules or atoms. However, by that time,
completely new technologies may be available. As this
book was being written, Stanford University announced
thatscientiststherehadmanagedtoencodetheletters“S”
and“U”withintheinterferencepatternsofquantumelec-
tron waves.
12
 In other words, they were able to encode

digital information within particles smaller than atoms.
Advances such as this may well form the foundation of
future information technologies in the area of quantum
computing; this will take computer engineering into the
realmofindividualatomsandevensubatomicparticles.
Evenifsuch breakthroughs don’t arrive intime,and
integrated circuit fabrication technology does eventually
hit a physical limit, it seems very likely that the focus
wouldsimplyshiftfrombuildingfasterindividualproces-
sors to instead linking large numbers of inexpensive,
commoditizedprocessorstogetherinparallelarchitectures.
Aswe’llseeinthenextsection,thisisalreadyhappening
toasignificantdegree,butifMoore’sLaweventuallyruns
out of steam, parallel processing may well become the
primaryfocusforbuildingmorecapablecomputers.
Even if the historical doubling pace ofMoore’s Law
doessomedayprovetobeunsustainable,thereisnorea-
son to believe that progress would halt or even become
linearinnature.Ifthepacefelloffsothatdoublingtook
four years (or even longer) rather than the current two
years, thatwould still beanexponential progressionthat
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would bring about staggering future gains in computing
power.
13

Let’slookatouroriginalassumptionagain:
Technologywillnotadvancetothepointwherethebulkofjobsper-

formed by typical people will be automated before the year 2089.
Priortothatyear,theeconomywillalwayscreatejobsthatarewithin
thecapabilitiesofthevastmajorityofthehumanpopulation.
Does that seem reasonable now? But wait, there’s
more.
World Computational Capability
Back in 1975,itprobablywould havebeen quiteeasyto
makealistofeverycomputerintheworld.Primarily,we
would have found computers in government agencies,
universities, and large corporations. A manufacturer like
IBM could probably have given us a list showing where
eachcomputerwasinstalled.Intheprecedingsection,we
talkedabouthowthepowerandspeedofcomputershas
increased.Ifwe took thatgeometricrate ofincreaseand
justappliedittothecomputersthatexistedin1975,that
wouldbeanincredibleexpansionofcomputationalpower.
Butofcourse,weknowthatisnotwhathappened.
The number of computers in the world has also in-
creased at a fantastic rate. By some estimates, there are
now over a billion personal computers in use. But it
doesn’t stop there. Computersin theform ofembedded
microprocessorsare in ourcell phones, mp3players, car
engines, appliances and in countless other places. Com-
putersareeverywhere.
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Infact,we mightspeculatethatboththe power and
thenumberofcomputersintheworldareincreasingata
geometric rate—or at least something closetoit.That is

clearlyanincomprehensibleincreaseinourtotalabilityto
manipulate information. If you consider the number of
obsoletedevicesthathavebeenthrownawaysincethePC
wasintroduced,it’seasytoseethatthecomputingpower
in landfills today is many orders of magnitude beyond
whatexistedintheworldin1975.
Itseemsimpossibletoimaginethatsuchanincredible
advanceinourabilitytocomputeandtoprocessinforma-
tioncouldtakeplacewithoutithavingadramaticeffecton
general technology, economics and society in general. In
fact, however, in many areas, change has not come as
quicklyasweperhapsmighthaveexpected.
Cars and airplanes now incorporate computers, but
theiroveralldesignandoperationisstill,forthemostpart,
whatitwasin1975.NASAmanagedtheApollomissions
andreachedthemoonwithoutaccesstomoderncompu-
tingpower.Eventhespaceshuttledatesbacktotheintro-
duction of the first PCs. Likewise, economists speak of
something called the productivity paradox, which basically
saysthat,atleastuntilquiterecently,theeconomyhasnot
reallyshowntheproductivitygainsyoumightexpectgiven
all the new computers that have been introduced into
workplaces. The computer revolution seems, so far, to
havelargelyturneditsenergyinwardonitself,resultingin
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advancesprimarilyintheinformationandcommunication
areas.
*


Ihavethefeelingthatthisstaggeringincreaseinour
computational capability represents a pent up resource
thatispoisedtoburstoutinnewandunexpectedways.In
thefuture,wecanexpectthatmanymoretraditionaltech-
nologies,andinfact nearlyeveryaspectofourlives,will
change—perhaps very rapidly—in ways that we cannot
foresee.Asexamplesofwhatwemightexpect,let’slook
attwothingsthathavealreadyoccurred:onethat,atleast
sofar,hasbeengenerallypositive,andonethathasbeen
decidedlynegative.
Grid and Cloud Computing
Gridcomputingisarapidlygrowingfieldthatfocuseson
leveraging not justthe powerofan individual computer,
butalsothelargenumberofsuchcomputersnowavaila-
ble.Theideaistotiemanycomputerstogetherusingspe-
cial software. A big computational problem can then be
brokendownintopiecesanddistributedacrosshundreds
oreventhousandsofcomputerssothattheycanworkon
it simultaneously. Grid computing has the potential to
bringanunprecedentedlevelofcomputingpowertobear
ondifficultproblemsintheareasofscienceandengineer-
ing.
Oneofthefirstandmostnotableapplicationsofgrid
computing was in theHuman Genome Project.This in-


*
 Even much of biotechnology and genetics could be considered a
type of information science because it is focused on cataloging and

understandingtheinformationinourDNA.
THE LIGHTS IN THE TUNNEL / 42

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ternational project began in 1990 and was completed in
2003—twoyearsaheadofschedule. Theprimarygoalof
theprojectwastosequencetheentirehumanDNAmole-
culeandtoidentifythe25,000orsoindividualgenesthat
comprise ourgenetic code. The processofdecoding our
DNAmoleculeandidentifyingeachgenetookatremend-
ousamountofcomputationalresources,andgridcompu-
tingplayedasignificantroleinthis.
Thegeneticinformationobtainedthroughtheproject
isstoredindatabasesandcanbeaccessedbyscientistsand
researchersviatheInternet.Theresultisafantasticsource
ofknowledgethatcontinuestobeanalyzedandwhichis
certain to result in innumerable future advances in the
fieldsofgenetics,bio-engineeringandmedicine.
An especially interestingdevelopment in thefield of
gridcomputingistheideathatunusedpoweronvirtually
anycomputerconnectedtotheInternetcanbeintegrated
intoavoluntarygridanddeployedtosolvebigproblems.
Mostcomputers,iflefton,donothingatallduringlarge
blocksoftime,especiallyovernight.Theideatotiethese
computerstogetherbyhavingtheirownersdonateunused
computingpowerhassprungupinanumberofplaces.
Stanford University’s folding@ home project is geared
towardsolvingdifficultproblemsinaspecializedareaof
biochemistryknownas“proteinfolding.”Advancesinthis
areahavethepotentialtoprovidefuturesolutionsforcan-

cerandfordiseasessuchasHuntington’sandParkinson’s.
AnothermajorplayerinthisareaistheBerkeleyOpenInfra-
structureforNetworkComputing(BOINC).This specialsoft-
ware,developedattheUniversityofCalifornia,Berkeley,