Where’s the Growth Going to Come from?

In China the Growth is coming from deploying the enormous pool of cheap labour. If you’re taking a peasant off the land, his productivity barely matters, it will still be an improvement. In the West, we don’t have that vast pool of Labour, though perhaps redesigning our welfare states to make it a little less easy to claim benefits for life and a little less taxing to choose low-paid work might help.

This is why China and India can grow at 8-10% a year by deploying already developed techniques and technology to billions of people still currently using the ox-plough, which was cutting edge technology in Europe 700 years ago. In general, as Britain, Europe, North America, Much of the Pacific Rim are on the ‘Technological frontier’ there is no off-the-self technology to deploy to generate growth. We must instead do things ever better in order to generate productivity growth. Starting with spinning and weaving, leading to the Industrial revolution, doing things slightly more efficiently was an incremental process. There have been several technologies to change the world since then: the Steam engine for the first time freed productive energy from animal muscle (and in a few aplications, the water-wheel & windmill). Later the Internal combustion engine gave personal mobility to the masses. Air travel shrunk the world. The internet gave everyone the equivalent of British Library on their desks and later in their pocket.

I think we’re on the cusp of another revolution in productivity. The driverless car. AutoNOMOS labs have trialled their car, ‘Made in Germany’, a VW Passat, on the public streets of Berlin. Google have also driven their driverless vehicle, a Prius round the streets of Nevada and California for hundreds of thousands of miles. This has been involved in just one accident, but it was being driven manually at the time. If you’re looking long term, all those delivery drivers, taxi drivers and chauffeurs will lose their jobs to machines. Their Labour can then go and be used elsewhere, making society as a whole richer. But it’s more than professional drivers. It’s the commuter too. Imagine you can read, make phone calls or sleep while getting somewhere. With the UKs average commute at 45 minutes each way that’s a lot of time freed up from doing a mentally taxing, boring, stressful and downright dangerous manual task. A machine WILL do it better, freeing you for work or leisure whilst travelling.

It is safe to assume that the driverless car will be safer than, say, an Italian or Frenchman driving at 80mph while texting his many mistresses. So there well be fewer road deaths, even in the UK where the standard of driving is reasonably high. There will be fewer accidents, meaning insurance will be cheaper, freeing that money up to be spent elsewhere. Fewer accidents means fewer people employed in the car insurance industry. The flow of traffic on arterial roads will become more laminar as fewer motorists over brake, change lanes and otherwise cause the stop-start traffic symptomatic of congestion. This will reduce stress, and reduce journey-times. The road’s carrying capacity will be improved at a stroke meaning road maintenance & building gets more from existing infrastructure. It is likely that cars on motorways could safely drive bumper-to-bumper, saving enormously on fuel on long journeys further increasing capacity. Self-driving cars could drop you off in the town centre, park, then return when needed, freeing city centre land from car-parks to more productive or aesthetically pleasing uses and hopefully re-invigorating town centres.

But it’s more than just better use of roads. Perhaps driverless cars will mean fewer people will bother owning one, freeing garage space for other uses. Instead perhaps fleets of cars will circulate before being summonsed by a phone call. Freed from the need to own and insure a car, people instead pay for journeys used. Each car is in use for a greater part of the day so capital currently employed sitting on drives and office car-parks for the vast majority of its useful life will be sweated more efficiently. Thus technological improvements lead to economic growth.

But in this case, it’s more than economic growth. Commuting is an hour of a half of concentrated stress and misery for many people. A long commute is up there with divorce and bereavement for making people miserable. A short one is second only to a successful marriage in correlation with self-declared happiness, and way above riches. If cars can park themselves there will be fewer cars in a town centre at any one time, meaning towns can finally be built around people, not machines once more. Can the driverless car make us happier?

It will certainly represent a huge boon to those currently unable to drive. The old, epileptics, the Blind and those just simply incapable of driving (the French, for example). Or Maureen, who will finally be able to enjoy the freedom of door-to-door travel.

And as for the rest of us. Freed from the controls, we could relax, let our minds wander, read and arrive wherever it is we want to go, refreshed. If you’re not driving you can travel without getting angsty that someone has slowed you down for 30 seconds. With no-one DRIVING their Audis or BMWs there will be fewer wankers (Cause or effect? I believe that these cars CAUSE people to become utter dicks while behind the wheel). I cannot see a single negative effect of this overdue technological development. Please don’t tell me you ENJOY day-to-day driving? If you’re a petrol-head, go to a race-track, where driving is as it should be -fun. There are plenty about.

You can think through other examples: an invention, an innovation, an improvement to an existing process, a time-saving device. Think of the knock on benefits in time or other resources saved, which can be used elsewhere. That is how our economy is going to grow. The current financial crisis is noise. The signal is the result of hundreds of years of freedom to come up with and develop ideas. And that has not stopped, nor will it, so long as we retain a capitalist, free-market economy and intellectual freedom which allows, celebrates and rewards those whose ideas make our lives a little better.

8 replies
  1. Anonymous
    Anonymous says:

    Yes, agree, the gradual decline in the availability of imported oil products or alternatively the rise in their price, will mean we need to turn over the UK's car fleet anyway.

  2. startledcod
    startledcod says:

    Dude, you've missed of the single biggest group of beneficiaries, rural pubs. We'll be able to leave the pub, climb in the back and snooze after slurring 'home Jamz' at the car. Brilliant.

    Or maybe not because some finger wagging w**ker would have a puritanical reason for not allowing this.


Trackbacks & Pingbacks

  1. […] conservative and risk-averse don’t like that which they don’t understand. Ultimately As we’re at the technological frontier, without innovation, we’ve no growth. And what does the UK desperately need […]

  2. […] It’s not just people: Reliable point to point courier services could be set up, facilitating a further refinement of just-in-time production. Deliveries, freed from the needs of people’s working capacity and the tachymetre could be arranged around the clock, at your convenience. And all this cheaper than the depreciation and fuel we waste now. This extra efficiency of use in transport infrastructure is where the next wave of economic growth is going to come from. […]

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