How the West escaped the innovation-squashing ‘technology trap’

By James Pethokoukis of AEI. 

"Thanks to a timely tweet from Adam Thierer, an innovation policy analyst at the Mercatus Center, I came across this great lecture, titled “The Future of Humanity” that science-fiction author and futurist Isaac Asimov gave at Newark College of Engineering on November 8, 1974. This bit was highlighted by Thierer:

Well, when I read all of these references I discovered, to my amazement, that all through history there had been resistance — and bitter, exaggerated, last-stitch resistance — to every significant technological change that had taken place on earth. Usually the resistance came from those groups who stood to lose influence, status, money as a result of the change. Although they never advanced this as their reason for resisting it. It was always the good of humanity that rested upon their hearts. . . . For instance, when the stagecoaches came into England, the canal owners objected. Not that they would lose money, although they would, but they feared for humanity. Because as the stagecoaches tore along at fifteen miles an hour, the air whipping past the nostrils of the people on board, would by Bernoulli’s Principle, suck all the air out of the lungs. . . . Well naturally the stagecoach people laughed heartily, and all they had to do was run a stagecoach at fifteen miles an hour with people inside and show them there’s no harm. But they memorized the argument for when the railroads came in.

No one thinks the smarties of today have way more raw brainpower than the geniuses of the past. Today’s AI scientists, human geneticists, and quantum physicists have nothing on Issac Newton, Leonardo da Vinci, Roger Bacon, Peter Abelard, Marcus Aurelius, Eratosthenes, or Aristotle. It has been said that besides the steam engine, the 18th century did not produce any breakthroughs that would have puzzled Archimedes, the great polymath of antiquity. So why did the Scientific Revolution that began in the 1500s not instead originate in Ancient Greece, and then the Industrial Revolution during the Roman Empire?

One important reason: Those pre-industrial societies intentionally extinguished the sparks of progress. For millennia, stasis had powerful defenders. The Roman Emperor Tiberius executed rather than rewarded a man who had invented unbreakable glass. Queen Elizabeth I declined to grant a patent to the inventor of the stocking-frame knitting machine, worrying that the invention would deprive textile workers of their employment. The guilds of preindustrial Europe played a key role in making sure Europe stayed preindustrial by blocking new technologies.

Then the protectors of the status quo, like the textile machinery-wrecking Luddites, started to fail. Governments started siding with the innovators and disruptors. Politicians did not like angry workers, but they liked losing wars to richer and technologically superior enemies even less. This is all documented in The Technology Trap by Carl Benedikt Frey, the Oxford Martin Citi Fellow at Oxford University, where he teaches economics and economic history. In November 2019, I had a podcast chat with Frey. From that conversation:

Pethokoukis: What was the original catalyst for the industrial revolution as you understand it?

Frey: So I don’t believe in mono-causal explanations of economic development. I think it was a blend of things that came together that made the industrial revolution, but I think that one very underestimated factor that I highlight in the book has to do with the structure of political power.

Before the industrial revolution, in most pre-industrial societies, craft skills were a source of political clout. They didn’t have any interest in technologies that threatened their jobs and incomes. And, fearing social unrest, monarchs of governments typically sided with the guilds rather than pioneers of industry, fearing that they might challenge the political status quo.

And what happened in Britain was, first of all, with the rise of Atlantic trade, the new merchant class emerged. They were the ones who stood to benefit from mechanization because, with rising wages, mechanization was what allowed them to remain competitive in trade.

Secondly, with the turnpike trusts that paved the way for the construction of much better road networks in Britain, the integration of markets meant that the political power of the craft guilds was gradually eroded because it didn’t extend beyond their own city. And as markets integrated, they were exposed to a lot more outside competition. Cities like Birmingham and Manchester emerged from, essentially, previously rural areas which weren’t exposed to any preexisting crafts guilds, and naturally they also became the masters of the first industrial revolution.

And thirdly, as the political power of the crafts guilds diminished, the threat from below diminished as well. But with growing competition among nation states in Europe, the threat of foreign invasion became much greater, and it therefore became increasingly hard to align technological conservatives with the political status quo.

That is why I think that the first industrial revolution happened in Britain. Science and other things clearly played a very big role as well, but that was in the later stages of the first industrial revolutions and even more so in the second industrial revolution."