Tuesday, May 6, 2014

Does America Still Have What It Takes?

Why the American spirit of innovation is in trouble, and what culture has to do with it. - Charles Murray/Mosaic Magazine
...In assessing contemporary America’s situation from this angle, the big unanswered question is whether the upward growth curve that has characterized the nation’s history will continue or whether our present low-growth mode is a sign of creeping economic senescence. It is too soon to say, but if the latter proves to be the case, innovation can be expected to diminish. No society has ever been economically sluggish and remained at the forefront of technological innovation....
Terminal Sclerosis: Can American innovation survive the paralysis of American government? - Charles Murray/Mosaic Magazine

...I, like many others, have been bemused by the seeming paralysis and incompetence of the federal government in recent years. This is not a reference specifically to the Obama administration. Instead, I think we are witnessing an advanced stage of the systemic sclerosis that Mancur Olson described in The Rise and Decline of Nations: Economic Growth, Stagflation, and Social Rigidities (1982). The options open to a sclerotic government are tightly limited by the special interests that have grown up within and around it. Sclerotic bureaucracies seek primarily to serve themselves, not the missions they are assigned. And even when a sclerotic government realizes that it is in peril, it is neither agile nor responsive, and is often unable even to prevent itself from doing harm to its own long-term interests.

To put my working hypothesis in terms of Silicon Valley, it seems quite possible to me that the modern American state will effectively cripple the information-technology industry’s innovativeness, oblivious to its dependence on that innovativeness. The same obliviousness will characterize the federal government’s policies toward other centers of American innovation. Whether I am right depends on how far sclerosis in the American government has progressed. My own assessment is that the sclerosis is close to terminal. But that’s a topic for another day.