Category Archives: Economics

Negativity has to end soon

There is much negativity about the future at the moment but post-Brexit, I am optimistic about our future. It looks better than it did before the referendum. Negativity spoils the short term but not the long term. Even if the next PM is rubbish – and once again it is a choice between bad and useless – they will be replaced by a better one in due course. Short term quite bad, long term very good.

The UK voted to leave the EU because most people thought we would be better leaving it, including me. Many commentators seek to project their own prejudices onto those who voted the other way, but all we know is that 52% voted to leave the EU; we don’t know why each one made that decision. Counting the votes told how many wanted to stay or leave the EU and only that; it can’t be mined to derive details of the mindset leading to that vote. It is not actually reasonable to infer that someone is a racist selfish moron from a leave vote. They might be, but you can’t derive that from the vote itself; you’d need other data. I’m not interested in debating all the various opinion polls about possible reasons, but it seem to me that there is little in common between typical poll stats for reasons given and the straw men put up by some remainers to demonise leavers. Demonisation just increases division.

Leavers voted leave for diverse baskets of reasons and attitudes, but the reasonable hope of probably most of them was that Britain could survive and prosper outside the EU, though economic reasons were usually secondary to escaping an undemocratic EU that was going the wrong way. Unfortunately we don’t currently have the competent and well-intentioned politicians and economic leaders we need to achieve the full potential so that needs fixed. We have some, but many seem to think it is more important to sulk in the corner, stomp their feet, do all they can to harm the economy, stir up division and encourage hatred, resentment and general bad feeling instead of putting their effort into making the most of a situation they didn’t want. They’d seemingly rather live in misery so they could say ‘I told you so’, but for some it might be that they actually don’t know how to do their jobs outside of the EU. They need to learn fast or be replaced.

That was to be expected, but it is a passing phase. Eventually, they’ll stop sulking and start doing the job they’re paid to do, or they’ll be replaced by others who can and will. Then the future freedom, prosperity and opportunity will come, slowly but surely, and it will become clear that the right decision was made and people will wonder what all the fuss was about. The UK will prosper, and the EU will either steer away from an embryonic Unites States of Europe towards a proper Common Market or evaporate via the domino effect, regardless of Tusk’s silly remark today that ‘there will be no sequel to Brexit’, which I suspect will go down as one of the worst predictions in political history.

Already, countries around the world are starting to discuss trade agreements with us. There is already enthusiasm for a new trading block of free and independent countries to deal with the EU. Currency and stocks and shares were always expected to take a short term hit during a period of uncertainty, and higher interest rates for out national debt was always expected to increase. Those are short term costs of a bigger long term benefit. Politicians, economists and bankers should work to accelerate the recovery and provide momentum to take us into improved prosperity. Nothing can be gained by moaning about how awful it is, exaggerating gloom or talking the economy down.

The media never accepts responsibility for anything, but they too play a part in the talking down and general negativity we’re seeing now. They don’t simply report things, they add huge negative spin and bias to make their own political points, to try to prevent Brexit or to reduce the changes and consequent benefits it could provide. They have also played a large role in the election of the new PM, strongly favouring one candidate (May) while undermining all the others. When the dust settles, it will be an excellent time to review the terms of existence of both the BBC and Channel 4 and especially to restore the impartiality the BBC once was famed for. Using the BBC or Channel 4 News as data sources at the moment is the intellectual equivalent of trying to survive by drinking swamp water full of decomposing sheep. Political bias in paid-for news channels is to be expected, but bias in organisations paid for equally by everyone is not acceptable, and if they can’t or won’t police themselves, then external policing should be imposed.

Some negativity was always expected after the referendum, whichever way it went. It must be just a short term hit, not become a way of life. We must not let it become the norm. Sulking benefits nobody.

 

 

 

 

 

New book: Society Tomorrow

It’s been a while since my last blog. That’s because I’ve been writing another book, my 8th so far. Not the one I was doing on future fashion, which went on the back burner for a while, I’ve only written a third of that one, unless I put it out as a very short book.

This one follows on from You Tomorrow and is called Society Tomorrow, 20% shorter at 90,000 words. It is ready to publish now, so I’m just waiting for feedback from a few people before hitting the button.

Frontcover

Here’s the introduction:

The one thing that we all share is that we will get older over the next few decades. Rapid change affects everyone, but older people don’t always feel the same effects as younger people, and even if we keep up easily today, some of us may find it harder tomorrow. Society will change, in its demographic and ethnic makeup, its values, its structure. We will live very differently. New stresses will come from both changing society and changing technology, but there is no real cause for pessimism. Many things will get better for older people too. We are certainly not heading towards utopia, but the overall quality of life for our ageing population will be significantly better in the future than it is today. In fact, most of the problems ahead are related to quality of life issues in society as a whole, and simply reflect the fact that if you don’t have to worry as much about poor health or poverty, something else will still occupy your mind.

This book follows on from 2013’s You Tomorrow, which is a guide to future life as an individual. It also slightly overlaps my 2013 book Total Sustainability which looks in part at future economic and social issues as part of achieving sustainability too. Rather than replicating topics, this book updates or omits them if they have already been addressed in those two companion books. As a general theme, it looks at wider society and the bigger picture, drawing out implications for both individuals and for society as a whole to deal with. There are plenty to pick from.

If there is one theme that plays through the whole book, it is a strong warning of the problem of increasing polarisation between people of left and right political persuasion. The political centre is being eroded quickly at the moment throughout the West, but alarmingly this does not seem so much to be a passing phase as a longer term trend. With all the potential benefits from future technology, we risk undermining the very fabric of our society. I remain optimistic because it can only be a matter of time before sense prevails and the trend reverses. One day the relative harmony of living peacefully side by side with those with whom we disagree will be restored, by future leaders of higher quality than those we have today.

Otherwise, whereas people used to tolerate each other’s differences, I fear that this increasing intolerance of those who don’t share the same values could lead to conflict if we don’t address it adequately. That intolerance currently manifests itself in increasing authoritarianism, surveillance, and an insidious creep towards George Orwell’s Nineteen Eighty-Four. The worst offenders seem to be our young people, with students seemingly proud of trying to ostracise anyone who dares agree with what they think is correct. Being students, their views hold many self-contradictions and clear lack of thought, but they appear to be building walls to keep any attempt at different thought away.

Altogether, this increasing divide, built largely from sanctimony, is a very dangerous trend, and will take time to reverse even when it is addressed. At the moment, it is still worsening rapidly.

So we face significant dangers, mostly self-inflicted, but we also have hope. The future offers wonderful potential for health, happiness, peace, prosperity. As I address the significant problems lying ahead, I never lose my optimism that they are soluble, but if we are to solve problems, we must first recognize them for what they are and muster the willingness to deal with them. On the current balance of forces, even if we avoid outright civil war, the future looks very much like a gilded cage. We must not ignore the threats. We must acknowledge them, and deal with them.

Then we can all reap the rich rewards the future has to offer.

It will be out soon.

Brexit, Futurizon’s analysis

The EU has a population of around 500M. These people differ enormously but agree to cooperate for mutual benefit. Being able to trade more easily with other countries is obviously a good idea, and for that reason the UK joined the Common Market. A common market may work better if there are commonly agreed standards so that buyers can be sure of the quality of what they are buying. Some regulations and associated administration align well with seamless running of a common market.

However, since the UK joined the Common market, it has evolved into a very different entity. Rather than just regulating easy trade, it has gone in baby steps so that noone would notice far beyond any interpretation of a free trade zone, firstly into a ‘European Economic Community’ and now the European Union. The EU now is intended by many of its leaders and executors to become a single country, a United States of Europe. There is nothing wrong with aspiring to that, but not all of us want to go that way. Now we will have a vote on it. Do we want to stay in the EU, with all of its current issues, knowing what it is intended to become, or to leave, re-asserting our own sovereignty, making our own laws and renegotiating trade agreements, controlling our own future?

The EU is made up of very different countries. We have the Northern set, with high wealth, a strong work ethic, relatively low corruption, strong regard for law and order, and a high welfare net. We have the Eastern European countries, with lower wealth but in some cases more vibrant populations, aspiring, and determined to self-improve. And we have Southern European, Mediterranean set, aligned with a lower work ethic, a gentler pace of life, but more affected by corruption and in some cases higher enthusiasm to avoid taxes. Incompatibility between the interests of these three zones has often featured in the Euro collapse.

Trade

A Brexit UK  would have to renegotiate terms of trade with the EU. We sell the EU far less than we buy from them, so it is in the EU’s interest to give us favorable terms.

Inside the EU, we cannot negotiate terms of trade with non-EU countries, but those are the fastest growing markets. The EU is the least well performing major trading block in the world. It is in the UK’s interest to be free to pursue larger and faster-growing non-EU markets without EU-imposed restraints.

Will Britain be better off in the EU as Cameron says? Very probably not. We would keep favorable trade with a shrinking EU, and gain trade with a faster expanding rest-of-the-world.

Trade would continue. I would still work for EU companies, and they would still gain just as much by choosing me over another. You’d still be able to buy French cheese or wine, or a German car,  or Swedish furniture, they won’t suddenly refuse to sell it to you. They will fight with fierce competition for your business from other regions, and offer you fair reciprocation, so there is no reason to fear unbalanced trade sanctions. As far as trade balance goes, the UK has most of the aces in this game.

Free movement of people

Free movement of people coupled to differences in standard of living encourages people to leave countries with low pay and welfare and migrate to others with better pay and welfare. Countries are not permitted to choose who enters, so it may be the top engineers or brain surgeons that all countries want, or people who won’t contribute much, make big demands on expensive services such as education and health and to send generous welfare payments home.

The 7 year period where we can restrict in-work benefits that Cameron has negotiated would mean that if he can show that the UK is under undue stress, then we can disallow benefits to future immigrants in their first year of entry, increasing them to maximum over the next 3 years. The savings estimated for this is around £30M, or less than 45p for each UK citizen. Cameron might therefore have saved you 45p, if he can argue that it would otherwise cause too much stress. Bigger savings would only occur if potential EU migrants decide that a year’s restriction on in-work benefits is too big a problem and prevents their migration, thereby saving their impacts on health, education and other  welfare. I don’t believe that will be the norm. I would expect virtually no impact from this headline win in his negotiations.

Free movement of people is not a requirement for free trade. They are quite separate issues. It is perfectly possible to agree amicable terms of trade with another nation without allowing citizens to relocate freely between them. A Brexit UK that negotiates trade agreements with the EU and other trading blocks would still be able to use an Australian-style points system to decide who to admit and who to reject, whether from the EU or anywhere else. The UK still has borders where passports are required for entry, since it was not part of Schengen, but it is nevertheless true that once a person is given any EU passport, they are able to travel and live here at will. Some of the migrants currently entering the EU are the sort of migrants everyone would welcome, but some are terrorists, some are criminals, some are religious extremists and a huge problem is that nobody knows which are which, so many undesirables will be given EU residence and passports.

Brexit UK would be far less vulnerable to entry by unsavory migrants and terrorists who have somehow managed to be accepted in any other EU country. It would be able to attract the best people and fill the needs of our industries, but to refuse entry to those who would be an overall strain on our systems.

Security

Cameron says we will be safer in the EU. That is an insult to our intelligence.

The world is a dangerous place right now. North Korea, Russia, the Middle East and North Africa are already major threats to peace, and China may become a security threat. The UK is a leading member of NATO, which has been the backbone of our defense for decades. Brexit UK would remain in NATO. The creation and success of NATO is the main reason that European countries live in peace.

The EU provides little additional security benefit, other than streamlining working of police forces to make catching criminals easier. Extreme ongoing delays in dealing with the migrant problem instead demonstrate total EU incompetence in the face of a security threat.

The EU creates some severe security risks. It has been argued by some that the EU’s attempt to capture the Ukraine as a part of the EU was a significant factor in causing the problems we see there now. Given the overall threat from that and its encouragement to Putin to expand elsewhere, it is very hard to see how one could believe the EU has made us more secure.

By its failure to stem the migrant crisis, and with Angela Merkel almost single-handedly causing it by encouraging them to take the risks to come, the EU has led to thousands of migrants dying at sea, and millions of unknown migrants to enter, some having deliberately discarded their identification, others using fake identification, during a period in which ISIS have stated their aim to smuggle as many terrorists into Europe as possible among the migrants. Many EU countries are now experiencing severe internal problems caused by migrants, such as massive increases in rape, sexual assaults, violence, intimidation, antisemitic attacks and other crime. By contrast, the UK’s policy is to help refugees close to their origin and to carefully select those most in need of resettlement to be allowed to come to the UK. By that policy, resources are focused on those most in need, migration is discouraged, many lives are saved and the UK is protected at least in the short term from the more unsavory migrants until they obtain EU identities.

A Brexit UK would still be able to help refugees in exactly the same ways but by being properly in control of our borders, reduce the risk of terrorists and criminals entering with EU identities. If we remain, undesirables will be able to come here at will once they obtain an EU identity.

Cameron knows all of this, as do his ministers. To claim that the UK is safer in Europe while knowing the opposite is true is simply lying. Brexit UK would be safer and more secure.

UK Relevance

If any proof were needed that the UK has very little influence in the EU, then Cameron just provided it. He went to beg for a few very minor changes to the UK’s position and got very little of even that. He is certainly no Thatcher. Two world wars failed to make Germany controller of Europe. By many tiny incremental changes that were never enough to make people worry, today’s EU is de-facto a German dictatorship. As perfectly illustrated by the migrant crisis, the Germans often seem to run the EU as their own show, sometimes allowing their French allies to have some input, with other countries generally doing as they are told. While Cameron has to beg for changes to migrant regulations, Germany unilaterally changes their polices without consultation. Germany shouts and expects everyone else to do as they command.

The EU as a whole is the last well performing of any trading block, and unilaterally handicaps its industries by environmental regulations and taxes. It has reducing military influence as China, Russia and the USA still dominate worldwide events.

Voter say varies enormously between countries too. Numbers of seat in Brussels are allocated disproportionately to smaller countries. Being outside of the Eurozone also reduces the UK’s say. The best the UK can ever hope for if we remain is to have an ever-decreasing say in a rapidly diminishing Europe.

Brexit UK will be a small player in a large world, but we have always shown strength and influence  well above our numbers in every domain, economic, cultural, technological and political, and we would do so outside the EU. The UK could grow as the EU declines. Remaining will ensure decreasing worldwide relevance.

Sovereignty

Ever closer union is a headline aim of the EU. It wants to become a Unites States of Europe. It almost certainly will in due course. The process will take several more decades, slowed further by all its self-inflicted problems. A weak EU superstate will gradually emerge onto a much stronger world stage. An EU UK would be just one small region of that. We would be irrelevant, doing as we are told by un-elected bureaucrats from other countries, having a say only on unimportant local issues. Taxed heavily to subsidise other regions, without much representation at all.

Brexit UK would regain its sovereignty. It would make its own decisions, its own alliances, its own place in the world. There can be no pretense that we would ever again have the status once enjoyed by the British Empire, but we have enough national character to play our part well.

Independence and freedom are goals worth fighting for. Our leaders surrendered much over the last few decades, and our country has suffered the consequences. We once led the world, now our EU partners consider us mostly a nuisance. We still command some respect in the world, but it is diminishing year on year as our ability to self-govern is siphoned away. It is time to reclaim our freedom and to become a leader once more.

The Scots might argue for another referendum to leave. They are fortunate indeed that the last one failed, given what has happened to oil prices since. They would now be arguing over Greek style budgets. No canny Scot would vote to leave the UK next time knowing it would mean certain decline in standard of living.

I have tried to understand the mindset that says that a United States of Europe is a good idea. I don’t doubt that many people believe in it, and some of them for well-argued reasons. I have no doubt that we will see some of them articulate its merits during coming months, and I will listen to them, and in the unlikely event that they’ve got a convincing argument, I’ll change my mind. Until then, I can’t see what we can achieve all forced into a single country that we cant achieve by separate countries cooperating.

Islamification

Islamification needs a mention in its won right since it is a major challenge for Europe now and for several decades to come, specially since Europe otherwise was becoming far more secular. The EU intends to absorb Turkey in due course, an Islamic country. The Islamic minority in other countries in Europe will grow greatly, as millions of Muslims already in the EU before the migrant crisis are joined by the millions of migrants already arrived, on the way or coming later, and then later joined by their families. Much higher birth rates feature in the Islamic community than ‘native Europeans’. Even leaving aside terrorist threats from extremist subgroups, many attitude surveys have shown that most Muslims do not consider their culture compatible with western values. Even peaceful Islamification already creates significant tensions right across the EU, and that will increase as numbers increase. Far worse of course, Islamic extremism and activism will also increase in line with numbers, especially as growing communities become more emboldened. Resurgence of far right parties claiming to fight back against Islamification is already evident and will undoubtedly worsen. The two will eventually very likely be in conflict. I have written many times comparing Islamic extremism and its response with the IRA problem in Belfast where I grew up. Islamification will be a very significant problem in the EU in coming years. Having better control of our borders won’t stop it also affecting the UK, where I calculate it could potentially become 13 times worse than the IRA troubles give the right stimulus, but it will help prevent it from getting far worse.

Brexit UK will still have a significant problem from Islamic terrorism, but an EU UK will have a far worse one.

If Brexit, then what?

The Common Market no longer exists. It was a good idea and it could exist again. In fact, watching current fragmentation of the EU, with fences being erected, borders closed, arguments over migrants becoming fiercer, and watching the slow car crash collapse of the Euro, there is every chance that European union as it is today could collapse. If Britain leaves, some other countries will look at having such freedom again. It is very likely that Brexit could stimulate partial evaporation of the EU, and an end to the dream of a united States of Europe. Britain could form alliances with other countries leaving to establish a proper common market, determined to be no more than a common market.

The EU is already creaking, pushed by several forces. Brexit could be the end of a nightmare, and the resurgence of the dream of a Common Market of sovereign states.

If we stay, that collapse might happen anyway. The seeds of doubt have been planted, watered and much fertilizer will be poured on them in next months and years. The EU is weak and will get weaker. It may survive and the nightmare United States of Europe might happen. Britain staying might even encourage further progress towards that goal. But even if Brexit fails, there is still every reason to expect that the nightmare might end all on its own, that others will realize that what we all actually want is a Common Market, not all the other stuff.

State of the world in 2050

Some things are getting better, some worse. 2050 will be neither dystopian nor utopian. A balance of good and bad not unlike today, but with different goods and bads, and slightly better overall. More detail? Okay, for most of my followers, this will mostly collate things you may know already, but there’s no harm in a refresher Futures 101.

Health

We will have cost-effective and widespread cures or control for most cancers, heart disease, diabetes, dementia and most other killers. Quality-of-life diseases such as arthritis will also be controllable or curable. People will live longer and remain healthier for longer, with an accelerated decline at the end.

On the bad side, new diseases will exist, including mutated antibiotic-resistant versions of existing ones. There will still be occasional natural flu mutations and other viruses, and there will still be others arising from contacts between people and other animals that are more easily spread due to increased population, urbanization and better mobility. Some previously rare diseases will become big problems due to urbanization and mobility. Urbanization will be a challenge.

However, diagnostics will be faster and better, we will no longer be so reliant on antibiotics to fight back, and sterilisation techniques for hospitals will be much improved. So even with greater challenges, we will be able to cope fine most of the time with occasional headlines from epidemics.

A darker side is the increasing prospect for bio-terrorism, with man-made viruses deliberately designed to be highly lethal, very contagious and to withstand most conventional defenses, optimized for maximum and rapid spread by harnessing mobility and urbanization. With pretty good control or defense against most natural threats, this may well be the biggest cause of mass deaths in 2050. Bio-warfare is far less likely.

Utilizing other techs, these bio-terrorist viruses could be deployed by swarms of tiny drones that would be hard to spot until too late, and of course these could also be used with chemical weapons such as use of nerve gas. Another tech-based health threat is nanotechnology devices designed to invade the body, damage of destroy systems or even control the brain. It is easy to detect and shoot down macro-scale deployment weapons such as missiles or large drones but far harder to defend against tiny devices such as midge-sized drones or nanotech devices.

The overall conclusion on health is that people will mostly experience much improved lives with good health, long life and a rapid end. A relatively few (but very conspicuous) people will fall victim to terrorist attacks, made far more feasible and effective by changing technology and demographics.

Loneliness

An often-overlooked benefit of increasing longevity is the extending multi-generational family. It will be commonplace to have great grandparents and great-great grandparents. With improved health until near their end, these older people will be seen more as welcome and less as a burden. This advantage will be partly offset by increasing global mobility, so families are more likely to be geographically dispersed.

Not everyone will have close family to enjoy and to support them. Loneliness is increasing even as we get busier, fuller lives. Social inclusion depends on a number of factors, and some of those at least will improve. Public transport that depends on an elderly person walking 15 minutes to a bus stop where they have to wait ages in the rain and wind for a bus on which they are very likely to catch a disease from another passenger is really not fit for purpose. Such primitive and unsuitable systems will be replaced in the next decades by far more socially inclusive self-driving cars. Fleets of these will replace buses and taxis. They will pick people up from their homes and take them all the way to where they need to go, then take them home when needed. As well as being very low cost and very environmentally friendly, they will also have almost zero accident rates and provide fast journey times thanks to very low congestion. Best of all, they will bring easier social inclusion to everyone by removing the barriers of difficult, slow, expensive and tedious journeys. It will be far easier for a lonely person to get out and enjoy cultural activity with other people.

More intuitive social networking, coupled to augmented and virtual reality environments in which to socialize will also mean easier contact even without going anywhere. AI will be better at finding suitable companions and lovers for those who need assistance.

Even so, some people will not benefit and will remain lonely due to other factors such as poor mental health, lack of social skills, or geographic isolation. They still do not need to be alone. 2050 will also feature large numbers of robots and AIs, and although these might not be quite so valuable to some as other human contact, they will be a pretty good substitute. Although many will be functional, cheap and simply fit for purpose, those designed for companionship or home support functions will very probably look human and behave human. They will have good intellectual and emotional skills and will be able to act as a very smart executive assistant as well as domestic servant and as a personal doctor and nurse, even as a sex partner if needed.

It would be too optimistic to say we will eradicate loneliness by 2050 but we can certainly make a big dent in it.

Poverty

Technology progress will greatly increase the size of the global economy. Even with the odd recession our children will be far richer than our parents. It is reasonable to expect the total economy to be 2.5 times bigger than today’s by 2050. That just assumes an average growth of about 2.5% which I think is a reasonable estimate given that technology benefits are accelerating rather than slowing even in spite of recent recession.

While we define poverty level as a percentage of average income, we can guarantee poverty will remain even if everyone lived like royalty. If average income were a million dollars per year, 60% of that would make you rich by any sensible definition but would still qualify as poverty by the ludicrous definition based on relative income used in the UK and some other countries. At some point we need to stop calling people poor if they can afford healthy food, pay everyday bills, buy decent clothes, have a decent roof over their heads and have an occasional holiday. With the global economy improving so much and so fast, and with people having far better access to markets via networks, it will be far easier for people everywhere to earn enough to live comfortably.

In most countries, welfare will be able to provide for those who can’t easily look after themselves at a decent level. Ongoing progress of globalization of compassion that we see today will likely make a global welfare net by 2050. Everyone won’t be rich, and some won’t even be very comfortable, but I believe absolute poverty will be eliminated in most countries, and we can ensure that it will be possible for most people to live in dignity. I think the means, motive and opportunity will make that happen, but it won’t reach everyone. Some people will live under dysfunctional governments that prevent their people having access to support that would otherwise be available to them. Hopefully not many. Absolute poverty by 2050 won’t be history but it will be rare.

In most developed countries, the more generous welfare net might extend to providing a ‘citizen wage’ for everyone, and the level of that could be the same as average wage is today. No-one need be poor in 2050.

Environment

The environment will be in good shape in 2050. I have no sympathy with doom mongers who predict otherwise. As our wealth increases, we tend to look after the environment better. As technology improves, we will achieve a far higher standards of living while looking after the environment. Better mining techniques will allow more reserves to become economic, we will need less resource to do the same job better, reuse and recycling will make more use of the same material.

Short term nightmares such as China’s urban pollution levels will be history by 2050. Energy supply is one of the big contributors to pollution today, but by 2050, combinations of shale gas, nuclear energy (uranium and thorium), fusion and solar energy will make up the vast bulk of energy supply. Oil and unprocessed coal will mostly be left in the ground, though bacterial conversion of coal into gas may well be used. Oil that isn’t extracted by 2030 will be left there, too expensive compared to making the equivalent energy by other means. Conventional nuclear energy will also be on its way to being phased out due to cost. Energy from fusion will only be starting to come on stream everywhere but solar energy will be cheap to harvest and high-tech cabling will enable its easier distribution from sunny areas to where it is needed.

It isn’t too much to expect of future governments that they should be able to negotiate that energy should be grown in deserts, and food crops grown on fertile land. We should not use fertile land to place solar panels, nor should we grow crops to convert to bio-fuel when there is plenty of sunny desert of little value otherwise on which to place solar panels.

With proper stewardship of agricultural land, together with various other food production technologies such as hydroponics, vertical farms and a lot of meat production via tissue culturing, there will be more food per capita than today even with a larger global population. In fact, with a surplus of agricultural land, some might well be returned to nature.

In forests and other ecosystems, technology will also help enormously in monitoring eco-health, and technologies such as genetic modification might be used to improve viability of some specie otherwise threatened.

Anyone who reads my blog regularly will know that I don’t believe climate change is a significant problem in the 2050 time frame, or even this century. I won’t waste any more words on it here. In fact, if I have to say anything, it is that global cooling is more likely to be a problem than warming.

Food and Water

As I just mentioned in the environment section, we will likely use deserts for energy supply and fertile land for crops. Improving efficiency and density will ensure there is far more capability to produce food than we need. Many people will still eat meat, but some at least will be produced in factories using processes such as tissue culturing. Meat pastes with assorted textures can then be used to create a variety of forms of processed meats. That might even happen in home kitchens using 3D printer technology.

Water supply has often been predicted by futurists as a cause of future wars, but I disagree. I think that progress in desalination is likely to be very rapid now, especially with new materials such as graphene likely to come on stream in bulk.  With easy and cheap desalination, water supply should be adequate everywhere and although there may be arguments over rivers I don’t think the pressures are sufficient by themselves to cause wars.

Privacy and Freedom

In 2016, we’re seeing privacy fighting a losing battle for survival. Government increases surveillance ubiquitously and demands more and more access to data on every aspect of our lives, followed by greater control. It invariably cites the desire to control crime and terrorism as the excuse and as they both increase, that excuse will be used until we have very little privacy left. Advancing technology means that by 2050, it will be fully possible to implement thought police to check what we are thinking, planning, desiring and make sure it conforms to what the authorities have decided is appropriate. Even the supposed servant robots that live with us and the AIs in our machines will keep official watch on us and be obliged to report any misdemeanors. Back doors for the authorities will be in everything. Total surveillance obliterates freedom of thought and expression. If you are not free to think or do something wrong, you are not free.

Freedom is strongly linked to privacy. With laws in place and the means to police them in depth, freedom will be limited to what is permitted. Criminals will still find ways to bypass, evade, masquerade, block and destroy and it hard not to believe that criminals will be free to continue doing what they do, while law-abiding citizens will be kept under strict supervision. Criminals will be free while the rest of us live in a digital open prison.

Some say if you don’t want to do wrong, you have nothing to fear. They are deluded fools. With full access to historic electronic records going back to now or earlier, it is not only today’s laws and guidelines that you need to be compliant with but all the future paths of the random walk of political correctness. Social networks can be fiercer police than the police and we are already discovering that having done something in the distant past under different laws and in different cultures is no defense from the social networking mobs. You may be free technically to do or say something today, but if it will be remembered for ever, and it will be, you also need to check that it will probably always be praiseworthy.

I can’t counterbalance this section with any positives. I’ve side before that with all the benefits we can expect, we will end up with no privacy, no freedom and the future will be a gilded cage.

Science and the arts

Yes they do go together. Science shows us how the universe works and how to do what we want. The arts are what we want to do. Both will flourish. AI will help accelerate science across the board, with a singularity actually spread over decades. There will be human knowledge but a great deal more machine knowledge which is beyond un-enhanced human comprehension. However, we will also have the means to connect our minds to the machine world to enhance our senses and intellect, so enhanced human minds will be the norm for many people, and our top scientists and engineers will understand it. In fact, it isn’t safe to develop in any other way.

Science and technology advances will improve sports too, with exoskeletons, safe drugs, active skin training acceleration and virtual reality immersion.

The arts will also flourish. Self-actualization through the arts will make full use of AI assistance. a feeble idea enhanced by and AI assistant can become a work of art, a masterpiece. Whether it be writing or painting, music or philosophy, people will be able to do more, enjoy more, appreciate more, be more. What’s not to like?

Space

by 2050, space will be a massive business in several industries. Space tourism will include short sub-orbital trips right up to lengthy stays in space hotels, and maybe on the moon for the super-rich at least.

Meanwhile asteroid mining will be under way. Some have predicted that this will end resource problems here on Earth, but firstly, there won’t be any resource problems here on Earth, and secondly and most importantly, it will be far too expensive to bring materials back to Earth, and almost all the resources mined will be used in space, to make space stations, vehicles, energy harvesting platforms, factories and so on. Humans will be expanding into space rapidly.

Some of these factories and vehicles and platforms and stations will be used for science, some for tourism, some for military purposes. Many will be used to offer services such as monitoring, positioning, communications just as today but with greater sophistication and detail.

Space will be more militarized too. We can hope that it will not be used in actual war, but I can’t honestly predict that one way or the other.

 

Migration

If the world around you is increasingly unstable, if people are fighting, if times are very hard and government is oppressive, and if there is a land of milk and honey not far away that you can get to, where you can hope for a much better, more prosperous life, free of tyranny, where instead of being part of the third world, you can be in the rich world, then you may well choose to take the risks and traumas associated with migrating. Increasing population way ahead of increasing wealth in Africa, and a drop in the global need for oil will both increase problems in the Middle East and North Africa. Add to that vicious religious sectarian conflict and a great many people will want to migrate indeed. The pressures on Europe and America to accept several millions more migrants will be intense.

By 2050, these regions will hopefully have ended their squabbles, and some migrants will return to rebuild, but most will remain in their new homes.

Most of these migrants will not assimilate well into their new countries but will mainly form their own communities where they can have a quite separate culture, and they will apply pressure to be allowed to self-govern. A self-impose apartheid will result. It might if we are lucky gradually diffuse as religion gradually becomes less important and the western lifestyle becomes more attractive. However, there is also a reinforcing pressure, with this self-exclusion and geographic isolation resulting in fewer opportunities, less mixing with others and therefore a growing feeling of disadvantage, exclusion and victimization. Tribalism becomes reinforced and opportunities for tension increase. We already see that manifested well in  the UK and other European countries.

Meanwhile, much of the world will be prosperous, and there will be many more opportunities for young capable people to migrate and prosper elsewhere. An ageing Europe with too much power held by older people and high taxes to pay for their pensions and care might prove a discouragement to stay, whereas the new world may offer increasing prospects and lowering taxes, and Europe and the USA may therefore suffer a large brain drain.

Politics

If health care is better and cheaper thanks to new tech and becomes less of a political issue; if resources are abundantly available, and the economy is healthy and people feel wealthy enough and resource allocation and wealth distribution become less of a political issue; if the environment is healthy; if global standards of human rights, social welfare and so on are acceptable in most regions and if people are freer to migrate where they want to go; then there may be a little less for countries to fight over. There will be a little less ‘politics’ overall. Most 2050 political arguments and debates will be over social cohesion, culture, generational issues, rights and so on, not health, defence, environment, energy or industry

We know from history that that is no guarantee of peace. People disagree profoundly on a broad range of issues other than life’s basic essentials. I’ve written a few times on the increasing divide and tensions between tribes, especially between left and right. I do think there is a strong chance of civil war in Europe or the USA or both. Social media create reinforcement of views as people expose themselves only to other show think the same, and this creates and reinforces and amplifies an us and them feeling. That is the main ingredient for conflict and rather than seeing that and trying to diffuse it, instead we see left and right becoming ever more entrenched in their views. The current problems we see surrounding Islamic migration show the split extremely well. Each side demonizes the other, extreme camps are growing on both sides and the middle ground is eroding fast. Our leaders only make things worse by refusing to acknowledge and address the issues. I suggested in previous blogs that the second half of the century is when tensions between left and right might result in the Great Western War, but that might well be brought forward a decade or two by a long migration from an unstable Middle East and North Africa, which looks to worsen over the next decade. Internal tensions might build for another decade after that accompanied by a brain drain of the most valuable people, and increasing inter-generational tensions amplifying the left-right divide, with a boil-over in the 2040s. That isn’t to say we won’t see some lesser conflicts before then.

I believe the current tensions between the West, Russia and China will go through occasional ups and downs but the overall trend will be towards far greater stability. I think the chances of a global war will decrease rather than increase. That is just as well since future weapons will be far more capable of course.

So overall, the world peace background will improve markedly, but internal tensions in the West will increase markedly too. The result is that wars between countries or regions will be less likely but the likelihood of civil war in the West will be high.

Robots and AIs

I mentioned robots and AIs in passing in the loneliness section, but they will have strong roles in all areas of life. Many that are thought of simply as machines will act as servants or workers, but many will have advanced levels of AI (not necessarily on board, it could be in the cloud) and people will form emotional bonds with them. Just as important, many such AI/robots will be so advanced that they will have relationships with each other, they will have their own culture. A 21st century version of the debates on slavery is already happening today for sentient AIs even though we don’t have them yet. It is good to be prepared, but we don’t know for sure what such smart and emotional machines will want. They may not want the same as our human prejudices suggest they will, so they will need to be involved in debate and negotiation. It is almost certain that the upper levels of AIs and robots (or androids more likely) will be given some rights, to freedom from pain and abuse, ownership of their own property, a degree of freedom to roam and act of their own accord, the right to pursuit of happiness. They will also get the right to government representation. Which other rights they might get is anyone’s guess, but they will change over time mainly because AIs will evolve and change over time.

OK, I’ve rambled on long enough and I’ve addressed some of the big areas I think. I have ignored a lot more, but it’s dinner time.

A lot of things will be better, some things worse, probably a bit better overall but with the possibility of it all going badly wrong if we don’t get our act together soon. I still think people in 2050 will live in a gilded cage.

2016 – The Bright Side

Having just blogged about some of the bad scenarios for next year (scenarios are just  explorations of things that might or could happen, not things that actually will, those are called predictions), Len Rosen’s comment stimulated me to balance it with a nicer look at next year. Some great things will happen, even ignoring the various product release announcements for new gadgets. Happiness lies deeper than the display size on a tablet. Here are some positive scenarios. They might not happen, but they might.

1 Middle East sorts itself out.

The new alliance formed by Saudi Arabia turns out to be a turning point. Rising Islamophobia caused by Islamist around the world has sharpened the view of ISIS and the trouble in Syria with its global consequences for Islam and even potentially for world peace. The understanding that it could get even worse, but that Western powers can’t fix trouble in Muslim lands due to fears of backlash, the whole of the Middle East starts to understand that they need to sort out their tribal and religious differences to achieve regional peace and for the benefit of Muslims everywhere. Proper discussions are arranged, and with the knowledge that a positive outcome must be achieved, success means a strong alliance of almost all regional powers, with ISIS and other extremist groups ostracized, then a common army organised to tackle and defeat them.

2 Quantum computation and AI starts to prove useful in new drug design

Google’s wealth and effort with its quantum computers and AI, coupled to IBM’s Watson, Facebook, Apple and Samsung’s AI efforts, and Elon Musk’s new investment in open-AI drive a positive feedback loop in computing. With massive returns on the horizon by making people’s lives easier, and with ever-present fears of Terminator in the background, the primary focus is to demonstrate what it could mean for mankind. Consequently, huge effort and investment is focused on creating new drugs to cure cancer, aids and find generic replacements for antibiotics. Any one of these would be a major success for humanity.

3 Major breakthrough in graphene production

Graphene is still the new wonder-material. We can’t make it in large quantities cheaply yet, but already the range of potential uses already proven for it is vast. If a breakthrough brings production cost down by an order of magnitude or two then many of those uses will be achievable. We will be able to deliver clean and safe water to everyone, we’ll have super-strong materials, ultra-fast electronics, active skin, better drug delivery systems, floating pods, super-capacitors that charge instantly as electric cars drive over a charging unit on the road surface, making batteries unnecessary. Even linear induction motor mats to replace self-driving cars with ultra-cheap driver-less pods. If the breakthrough is big enough, it could even start efforts towards a space elevator.

4 Drones

Tiny and cheap drones could help security forces to reduce crime dramatically. Ignoring for now possible abuse of surveillance, being able to track terrorists and criminals in 3D far better than today will make the risk of being caught far greater. Tiny pico-drones dropped over Syria and Iraq could pinpoint locations of fighters so that they can be targeted while protecting innocents. Environmental monitoring would also benefit if billions of drones can monitor ecosystems in great detail everywhere at the same time.

5 Active contact lens

Google has already prototyped a very primitive version of the active contact lens, but they have been barking up the wrong tree. If they dump the 1-LED-per-Pixel approach, which isn’t scalable, and opt for the far better approach of using three lasers and a micro-mirror, then they could build a working active contact lens with unlimited resolution. One in each eye, with an LCD layer overlaid, and you have a full 3D variably-transparent interface for augmented reality or virtual reality. Other displays such as smart watches become unnecessary since of course they can all be achieved virtually in an ultra-high res image. All the expense and environmental impact of other displays suddenly is replaced by a cheap high res display that has an environmental footprint approaching zero. Augmented reality takes off and the economy springs back to life.

6 Star Wars stimulates renewed innovation

Engineers can’t watch a film without making at least 3 new inventions. A lot of things on Star Wars are entirely feasible – I have invented and documented mechanisms to make both a light saber and the land speeder. Millions of engineers have invented some way of doing holographic characters. In a world that seems full of trouble, we are fortunate that some of the super-rich that we criticise for not paying as much taxes as we’d like are also extremely good engineers and have the cash to back up their visions with real progress. Natural competitiveness to make the biggest contribution to humanity will do the rest.

7 Europe fixes itself

The UK is picking the lock on the exit door, others are queuing behind. The ruling bureaucrats finally start to realize that they won’t get their dream of a United States of Europe in quite the way they hoped, that their existing dream is in danger of collapse due to a mismanaged migrant crisis, and consequently the UK renegotiation stimulates a major new treaty discussion, where all the countries agree what their people really want out of the European project, rather than just a select few. The result is a reset. A new more democratic European dream emerges that the vest majority of people actually wants. Agreement on progress to sort out the migrant crisis is a good test and after that, a stronger, better, more vibrant Europe starts to emerge from the ashes with a renewed vigor and rapidly recovering economy.

8 Africa rearranges boundaries to get tribal peace

Breakthrough in the Middle East ripples through North Africa resulting in the beginnings of stability in some countries. Realization that tribal conflicts won’t easily go away, and that peace brings prosperity, boundaries are renegotiated so that different people can live in and govern their own territories. Treaties agree fair access to resources independent of location.

9 The Sahara become Europe’s energy supply

With stable politics finally on the horizon, energy companies re-address the idea of using the Sahara as a solar farm. Local people earn money by looking after panels, keeping them clean and in working order, and receive welcome remuneration, bringing prosperity that was previously beyond them. Much of this money in turn is used to purify water, irrigating deserts and greening them, making a better food supply while improving the regional climate and fixing large quantities of CO2. Poverty starts to reduce as the environment improves. Much of this is replicated in Central and South America.

10 World Peace emerges

By fighting alongside in the Middle East and managing to avoid World War 3, a very positive relationship between Russia and the West emerges. China meanwhile, makes some of the energy breakthroughs needed to get solar efficiency and cost down below oil cost. This forces the Middle East to also look Westward for new markets and to add greater drive to their regional peace efforts to avoid otherwise inevitable collapse. Suddenly a world that was full of wars becomes one where all countries seem to be getting along just fine, all realizing that we only have this one world and one life and we’d better not ruin it.

2016: The Dark Side

Bloomberg reports the ‘Pessimists guide to the world in 2016’, by By Flavia Krause-Jackson, Mira Rojanasakul, and John Fraher.

http://www.bloomberg.com/graphics/pessimists-guide-to-2016/

Excellent stuff. A healthy dose of realism to counter the spin and gloss and outright refusals to notice things that don’t fit the agenda that we so often expect from today’s media. Their entries deserve some comment, and I’ll add a few more. I’m good at pessimism.

Their first entry is oil reaching $100 a barrel as ISIS blows up oil fields. Certainly possible, though they also report the existing oil glut: http://www.bloomberg.com/news/articles/2015-12-17/shale-drillers-are-now-free-to-export-u-s-oil-into-global-glut

Just because the second option is the more likely does not invalidate the first as a possible scenario, so that entry is fine.

An EU referendum in June is their 2nd entry. Well, that will only happen if Cameron gets his way and the EU agrees sufficient change to make the referendum result more likely to end in a Yes. If there is any hint of a No, it will be postponed as far as possible to give politics time to turn the right way. Let’s face facts. When the Ukraine had their referendum, they completed the entire process within two weeks. If the Conservatives genuinely wanted a referendum on Europe, it would have happened years ago. The Conservatives make frequent promises to do the Conservative thing very loudly, and then quietly do the Labour thing and hope nobody notices. Osborne promised to cut the deficit but faced with the slightest objections from the media performed a text-book U-turn. That follow numerous U-turns on bin collections, speed cameras, wheel clamping, environment, surveillance, immigration, pensions, fixing the NHS…. I therefore think he will spin the EU talks as far as possible to pretend that tiny promises to think about the possibility of reviewing policies are the same as winning guarantees of major changes. Nevertheless, an ongoing immigration flood and assorted Islamist problems are increasing the No vote rapidly, so I think it far more likely that the referendum will be postponed.

The 3rd is banks being hit by a massive cyber attack. Very possible, even quite likely.

4th, EU crumbles under immigration fears. Very likely indeed. Schengen will be suspended soon and increasing Islamist violence will create increasing hostility to the migrant flow. Forcing countries to accept a proportion of the pain caused by Merkel’s naivety will increase strains between countries to breaking point. The British referendum on staying or leaving adds an escape route that will be very tempting for politicians who want to stay in power.

Their 5th is China’s economy failing and military rising. Again, quite feasible. Their economy has suffered a slowdown, and their military looks enthusiastically at Western decline under left-wing US and Europe leadership, strained by Middle Eastern and Russian tensions. There has never been a better time for their military to exploit weaknesses.

6 is Israel attacking Iranian nuclear facilities. Well, with the US and Europe rapidly turning antisemitic and already very anti-Israel, they have pretty much been left on their own, surrounded by countries that want them eliminated. If anything, I’m surprised they have been so patient.

7 Putin sidelines America. Is that not history?

8 Climate change heats up. My first significant disagreement. With El-Nino, it will be a warm year, but evidence is increasing that the overall trend for the next few decades will be cooling, due to various natural cycles. Man made warming has been greatly exaggerated and people are losing interest in predictions of catastrophe when they can see plainly that most of the alleged change is just alterations to data. Yes, next year will be warm, but thanks to far too many cries of wolf, apart from meta-religious warmists, few people still believe things will get anywhere near as bad as doom-mongers suggest. They will notice that the Paris agreement, if followed, would trash western economies and greatly increase their bills, even though it can’t make any significant change on global CO2 emissions. So, although there will be catastrophe prediction headlines next year making much of higher temperatures due to El Nino, the overall trend will be that people won’t be very interested any more.

9 Latin America’s lost decade. I have to confess I did expect great things from South America, and they haven’t materialized. It is clear evidence that a young vibrant population does not necessarily mean one full of ideas, enthusiasm and entrepreneurial endeavor. Time will tell, but I think they are right on this one.

Their 10th scenario is Trump winning the US presidency. I can’t put odds on it, but it certainly is possible, especially with Islamist violence increasing. He offers the simple choice of political correctness v security, and framed that way, he is certainly not guaranteed to win but he is in with a decent chance. A perfectly valid scenario.

Overall, I’m pretty impressed with this list. As good as any I could have made. But I ought to add a couple.

My first and most likely offering is that a swarm of drones is used in a terrorist attack on a stadium or even a city center. Drones are a terrorist’s dream, and the lack of licensing has meant that people can acquire lots of them and they could be used simultaneously, launched from many locations and gathering together in the same place to launch the attack. The attack could be chemical, biological, explosive or even blinding lasers, but actually, the main weapon would be the panic that would result if even one or two of them do anything. Many could be hurt in the rush to escape.

My second is a successful massive cyber-attack on ordinary people and businesses. There are several forms of attack that could work and cause enormous problems. Encryption based attacks such as ransomware are already here, but if this is developed by the IT experts in ISIS and rogue regimes, the ransom might not be the goal. Simply destroying data or locking it up is quite enough to be a major terrorist goal. It could cause widespread economic harm if enough machines are infected before defenses catch up, and AI-based adaptation might make that take quite a while. The fact is that so far we have been very lucky.

The third is a major solar storm, which could knock out IT infrastructure, again with enormous economic damage. The Sun is entering a period of sunspot drought quite unprecedented since we started using IT. We don’t really know what will happen.

My fourth is a major virus causing millions of deaths. Megacities are such a problem waiting to happen. The virus could evolve naturally, or it could be engineered. It could spread far and wide before quarantines come into effect. This could happen any time, so next year is a valid possibility.

My fifth and final scenario is unlikely but possible, and that is the start of a Western civil war. I have blogged about it in https://timeguide.wordpress.com/2013/12/19/machiavelli-and-the-coming-great-western-war/ and suggested it is likely in the middle or second half of the century, but it could possibly start next year given the various stimulants we see rising today. It would affect Europe first and could spread to the USA.

Paris – Climate Change v Islamism. Which problem is biggest?

Imagine you are sitting peacefully at home watching a movie with your family. A few terrorists with guns burst in. They start shooting. What is your reaction?

Option A) you tell your family not to do anything but to continue watching TV, because reacting would be giving in to the terrorists – they want you to be angry and try to attack them, but you are the better person, you have the moral superiority and won’t stoop to their level. Anyway, attacking them might anger them more and they might be even more violent. You tell your family they should all stick together and show the terrorists they can’t win and can’t change your way of life by just carrying on as before. You watch as one by one, each of your kids is murdered, determined to occupy the moral high ground until they shoot you too.

Option B) you understand that what the terrorists want is for you and your family to be dead. So you grab whatever you can that might act as some sort of weapon and rush at the terrorists, trying to the end to disarm them and protect your family.  If you survive, you then do all you can to prevent other terrorists from coming into your home. Then you do all you can to identify where they are coming from and root them out.

The above choice is a little simplistic but it highlights the key points of the two streams of current opinion on the ‘right’ response.

Option B recognizes that you have to remain alive to defend your principles. Once you’ve dealt with the threat, then you are free to build as many ivory towers and moral pedestals as you want. Option A simply lets the terrorists win.

There is no third option for discussing it peacefully over a nice cup of tea, no option for peace and love and mutual respect for all. ISIS are not interested in peace and love. They are barbarians with the utmost contempt for civilization who want to destroy everything that doesn’t fit into their perverted interpretation of an Islamic world. However, ISIS is just one Islamist terror group of course and if we are successful in conquering them, and then Al Qaeda and Boko Haram, and so on, other Islamist groups will emerge. Islamism is the problem, ISIS is just the worst current group. We need to deal with it.

I’ll draw out some key points from my previous blogs. If you want more detail on the future of ISIS look at https://timeguide.wordpress.com/2015/07/13/the-future-of-isis/

The situation in Europe shows a few similarities with the IRA conflict, with the advantage today that we are still in the early stages of Islamist violence. In both cases, the terrorists themselves are mostly no-hoper young men with egos out of alignment with their personal reality. Yes there are a few women too. They desperately want to be respected, but with no education and no skills, a huge chip on their shoulder and a bad attitude, ordinary life offers them few opportunities. With both ISIS and the IRA, the terrorists are drawn from a community that considers itself disadvantaged. Add a hefty amount of indoctrination about how terribly unfair the world is, the promise of being a hero, going down in history as a martyr and the promise of 72 virgins to play with in the afterlife, and the offer to pick up a gun or a knife apparently seems attractive to some. The IRA recruited enough fighters even without the promise of the virgins.

The IRA had only about 300 front-line terrorists at any time, but they came from the nationalist community of which an estimated 30% of people declared some sympathy for them. Compare that with a BBC survey earlier this year that found that in the aftermath of the Charlie Hebdo attacks, only 68% of Muslims agreed with the statement “Acts of violence against those who publish images of the Prophet Mohammed can never be justified”. 68% and 70% are pretty close, so I’ll charitably accept that the 68% were being honest and not simply trying to disassociate themselves from the Paris massacre. The overwhelming majority of British Muslims rejecting violence – two thirds in the BBC survey, is entirely consistent with other surveys on Muslim attitudes around the world, and probably a reasonable figure for Muslims across Europe. Is the glass half full or half empty? Your call.

The good news is the low numbers that become actual front-line terrorists. Only 0.122% of the nationalist community in Northern Ireland at any particular time were front-line IRA terrorists. Now that ISIS are asking potential recruits not to go to Syria but to stay where they are and do their thing there, we should consider how many there might be. If we are lucky and the same 0.122% applies to our three million UK Muslims, then about 3600 are potential Islamist terrorists. That’s about 12 times bigger than the IRA problem if ISIS or other Islamist groups get their acts together. With 20 million Muslims in Europe, that would make for potentially 24,000 Islamist terrorists, or 81 IRAs to put it another way. Most can travel freely between countries.

What of immigration then? People genuinely fleeing violence presumably have lower support for it, but they are only a part of the current influx. Many are economic migrants and they probably conform more closely to the norm. We also know that some terrorists are hiding among other migrants, and indeed at least two of those were involved in the latest Paris massacre. Most of the migrants are young men, so that would tend to skew the problem upwards too. With forces acting in both directions, it’s probably not unreasonable as a first guess to assume the same overall support levels. According to the BBC, 750,000 have entered Europe this year, so that means another 900 potential terrorists were likely in their midst. Europe is currently importing 3 IRAs every year.

Meanwhile, it is rather ironic that many of the current migrants are coming because Angela Merkel felt guilty about the Holocaust. Many Jews are now leaving Europe because they no longer feel safe because of the rapidly rising numbers of attacks by the Islamists she has encouraged to come.

So, the first Paris issue is Islamism, already at 81 potential IRAs and growing at 3 IRAs per year, plus a renewed exodus of Jews due to widespread increasing antisemitism.

So, to the other Paris issue, climate change. I am not the only one annoyed by the hijacking of the environment by leftist pressure groups, because the poor quality of analysis and policies resulting from that pressure ultimately harms both the environment and the poor.

The world has warmed since the last ice age. Life has adjusted throughout to that continuing climate change. Over the last century, sea level has steadily increased, and is still increasing at the same rate now. The North Pole ice has shrunk, to 8.5% to 11% below normal at the moment depending whose figures you look at, but it certainly isn’t disappearing any time soon. However, Antarctic sea ice  has grown to 17% to 25% above normal again depending whose figures you look at, so there is more ice than normal overall. Temperature has also increased over the last century, with a few spurts and a few slowdowns. The last spurt was late 70s to late 90s, with a slowdown since. CO2 levels have rocketed up relentlessly, but satellite-measured temperature hasn’t moved at all since 1998. Only when figures are tampered with is any statistically significant rise visible.

Predictions by climate models have almost all been far higher than the empirical data. In any other branch of science, that would mean throwing theories away and formulating better ones. In climate science, numerous adjustments by alleged ‘climate scientists’ show terrible changes ahead; past figures have invariably been adjusted downwards and recent ones upwards to make the rises seem larger. Climate scientists have severely damaged the reputation of science in every field. The public now distrusts all scientists less and disregard for scientific advice in lifestyle, nutrition, exercise and medication will inevitably lead to an increase in deaths.

Everyone agrees that CO2 is a greenhouse gas and increases will have a forcing effect on temperature, but there is strong disagreement about the magnitude of that effect, the mechanisms and magnitudes of the feedback processes throughout the environmental system, and both the mechanisms and magnitudes of a wide range of natural effects. It is increasingly obvious that climate scientists only cover a subset of the processes affecting climate, but they seem contemptuous of science in other disciplines such as astrophysics that cover important factors such as solar cycles. There is a strong correlation between climate and solar cycles historically but the mechanisms are complex and not yet fully understood. It is also increasingly obvious that many climate scientists are less concerned about the scientific integrity of their ‘research’ than maintaining a closed shop, excluding those who disagree with them, getting the next grant or pushing a political agenda.

Empirical data suggests that the forcing factor of CO2 itself is not as high as assumed in most models, and the very many feedbacks are far more complex than assumed in most models.

CO2 is removed from the environment by natural processes of adaptation faster than modeled – e.g. plants and algae grow faster, and other natural processes such as solar or ocean cycles have far greater effects than assumed in the models. Recent research suggests that it has a ‘half-life’ in the atmosphere only of around 40 years, not the 1000 years claimed by ‘climate scientists’. That means that the problem will go away far faster when we fix it than has been stated.

CO2 is certainly a greenhouse gas, and we should not be complacent about generating it, but on current science (before tampering) it seems there is absolutely no cause for urgent action. It is right to look to future energy sources and move away from fossil fuels, which also cause other large environmental problems, not least of which the particulates that kill millions of people every year. Meanwhile, we should expedite movement from coal and oil to low carbon fossil fuels such as shale gas.

As is often observed, sunny regions such as the Sahara could easily produce enough solar energy for all of Europe, but there is no great hurry so we can wait for the technology to become sufficiently cheap and for the political stability in appropriate areas to be addressed so that large solar farms can be safely developed and supply maintained. Meanwhile, southern Europe is reasonably sunny, politically stable and needs cash. Other regions also have sunny deserts to support them. We will also have abundant fusion energy in the 2nd half of the century. So we have no long term energy problem. Solar/fusion energy will eventually be cheap and abundant, and at an equivalent of less than $30 per barrel of oil, we won’t bother using fossil fuels because they will be too expensive compared to alternatives. The problems we do have in energy supply are short term and mostly caused by idiotic green policies that worsen supply, costs and environmental impact. It is hard to think of a ‘green’ policy that actually works.

The CO2 problem will go away in the long term due to nothing but simple economics and market effects. In the short term, we don’t see a measurable problem due to a happy coincidence of solar cycles and ocean cycles counteracting the presumed warming forcing of the CO2. There is absolutely no need to rush into massively problematic taxes and subsidies for immature technology. The social problems caused by short term panic are far worse than the problem they are meant to fix. Increased food prices have been caused by regulation to enforce use of biofuels. Ludicrously stupid carbon offset programs have led to chopping down of rain forests, draining of peat bogs and forced relocation of local peoples, and after all tat have actually increased CO2 emissions. Lately, carbon taxes in the UK, far higher than elsewhere, have led to collapse of the aluminium and steel industries, while the products have still been produced elsewhere at higher CO2 cost. Those made redundant are made even poorer because they have to pay higher prices for energy thanks to enormous subsidies to rich people who own wind or solar farms. Finally, closing down fossil fuel plants before we have proper substitutes in place and then asking wind farm owners to accept even bigger subsidies to put in diesel generators for use on calm  and dull days is the politics of the asylum. Green policies perform best at transferring money from poor to rich, with environmental damage seemingly a small price to pay for a feel-good factor..

Call me a skeptic or a denier or whatever you want if you like. I am technically ‘luke warm’. There is a problem with CO2, but not a big one, and it will go away all by itself. There is no need for political interference and that which we have seen so far has made far worse problems for both people and the environment than climate change would ever have done. Our politicians would do a far better job if they did nothing at all.

So, Paris then. On one hand we have a minor problem from CO2 emissions that will go away fastest with the fewest problems if our politicians do nothing at all. On the other hand, their previous mistakes have already allowed the Islamist terrorist equivalent of 81 IRAs to enter Europe and the current migrant flux is increasing that by 3 IRAs per year. That does need to be addressed, quickly and effectively.

Perhaps they should all stay in Paris but change the subject.

 

The future of immigration: rational v emotional response

People use emotions and rational thinking in parallel. There is a clear role for each. Emotions create a driving force towards a goal, and rational thinking works best to figure out the best strategy to achieve it. So, you see a delicious cake that you’d very much like to eat, emotional bit complete. Your rational thinking kicks in and works out that you need to enter the shop, indicate your choice, hand over some cash and then take the cake and bite into it. Your rational thinking also interrupts with some possibly relevant queries – is it good value compared to the one next to it that looks just as nice? Do you have your best suit on and is it likely to ruin it? How many calories might it be? That sort of thing is a typical everyday challenge we all face and a well-developed brain allows emotions and rationality to work in perfect harmony to add pleasure to our day within our means. Emotions and intellect should also work in harmony when we are faced with danger or unpleasant situations such as seeing others in danger or suffering.

This last few months, we’ve all seen the trauma suffered by millions of refugees from tribal and religious wars in the Middle East and Africa, and most of us want to help them. The photo of the drowned toddler this week made lots of people suddenly very emotional, but in response to their resultant wave of competitive emoting and sometimes quite sickening sanctimony, the rest of us might reasonably inquire firstly why these people didn’t care beforehand like the rest of us and secondly why they think that the best way to respond is to switch off their brains. People have been suffering years, not just this last week. One toddler death is very sad but so are the many thousands of deaths beforehand that didn’t get photographed. And the way to avoid future deaths isn’t necessarily to do the very first thing that pops into your head.

UK Rational Response

With its well-established values, the UK was culturally-emotionally driven to help and has done more to actually help so far than any other European country, including giving 50% more to help refugees so far than Germany. Cameron often makes idiotic decisions, but he is right this time that the best way to help is not to let everyone into Britain but instead to contribute heavily to making effective safe havens and refugee centers near the refugee sources, e.g Syria. This is by far the best policy for a number of reasons.

Doing that helps genuine refugees. The inhabitants of refugee camps are far more likely to be genuinely fleeing from danger and in need of protection, far less likely to be economic migrants.

They are also far less likely to be ISIS terrorists trying to get entry to Europe to cause trouble, or criminals fleeing from justice than those fighting their way through train stations and disobeying police.

Better still, the UK policy helps the most vulnerable refugees – the old and the frail and the too young or too afraid to make the journey all the way to Northern Europe. Some of the most vulnerable will be allowed to come to Britain from those refugee centres.

The UK policy also helps genuine refugees without contributing to ISIS and the other likely destinations of the people traffickers fees. Each migrant squeezed onto an unsafe boat is another £2000 to a terrorist or criminal group, making the problem worse.

Using refugee centers and safe havens near to their own country avoids some of the long term problems associated with immigration to a foreign land, such as cultural conflicts.

Best of all, the UK policy of taking people from the camps and refusing those that have made the long and perilous journey to demand entry discourages people from taking that risk and therefore reduces the problem. Fewer toddlers will drown if people realize that it is best for their family to stay put than to take a huge risk to travel to a closed door.

Emotional response

Contrast this with the policy advocated by those sanctimonious emoters screaming about how wonderful and loving they are and how heartless everyone else is – that we should let everyone in. If we adopted that policy the result would be increased death and misery:

More and more people would want to come if they realize that the door to a better life is wide open.

The number of deaths would sharply increase as more and more criminal gangs and terrorist groups start trafficking.

Greater revenue would flow to ISIS and other terrorist and criminal groups, increasing their power and consequent problems in the countries people are fleeing from.

Allowing in those that made the journey might look charitable but actually it protects the strong rather than the weak. The weak could not come. Why allow a fit young man entry and deny a pregnant mother who wasn’t able to make the trip? Surely the young man should have stayed to fight to protect his vulnerable compatriots instead of fleeing for his own safety?

The number of terrorists and criminals entering among ordinary migrants and refugees would greatly increase (ISIS has already stated its guidance to followers try to enter the UK to commit terrorist acts here) leading to greatly increased security problems here, and resulting in probable backlash against genuine refugees, making it worse here for genuine refugees as well as the rest of us. Levels of crime and terrorism would increase greatly. (One of the reasons Saudi Arabia and some other Middle Eastern countries have stated why they won’t accept refugees is because terrorists and criminals are likely to try to hide in their midst.) I have previously estimated the likely scale of ISIS type terrorism in the UK and it is a big potential problem indeed. Increasing the numbers of supporters, recruits and even actual terrorists won’t help.

The numbers of economic migrants would also greatly increase. If the sheer weight of numbers of migrants coupled to political pressure from emotional activists means that no clear distinction is made between genuine refuges and all the others, then most people in the developing world might soon consider Europe an attractive option. There is no upper limit to migrant numbers until Europe is reduced in attractiveness to levels similar to migrant countries of origin.

Low-paid workers in host countries would find even greater downward pressure on wages, resulting in greater unemployment and poverty. Homeless people would find it harder to get homes. Sick people would find it harder to get access to medical care. All citizens would see greater pressure on public services and infrastructure. There are already significant conflicts throughout Europe between immigrant communities and host societies due to resource competition, and these would increase greatly as immigrant numbers put high pressure on infrastructure, public services and welfare. Cultural conflict is increasing too, especially with Islamic immigrant communities. Racial and religious conflict would increase.

The result would be a broken society, with increased poverty, increased crime and terrorism, decreased safety and security for everyone, increased social conflict, greater racism, and the inevitable rise of extremist groups on both sides.

Managed Immigration and Asylum

We need immigrants. We don’t educate enough doctors or engineers (or many other worker groups) so we need to fill posts with people from overseas. That need won’t go away. However, with very limited spare capacity in our already overpopulated country, we should limit normal immigration to those people we need and just a few others.

On top of that, humanity demands that we do our best to help people in need elsewhere. Obviously we don’t have enough resources to make everyone in the world wealthy so we must do what we can using our foreign aid budget and personal donations to whatever charities we think do a good job. Where people are displaced due to conflict, we should do what we can to give them safe havens, preferably without building instability and making future problems worse. Using our own and allied military to provide no-fly zones can make swathes of a country safer. UN peacekeeping forces could also be used if need be to protect people in those zones. That allows people to stay in their own country or an adjacent one with similar culture. Costs of providing and managing safe havens could be shared across all the rich nations, reducing unwillingness of potential host nations to offer them.

It is not always necessary to offer full immigration to people just to give them safe haven. Asylum should be reserved for those who genuinely cannot stay where they are, and where a problem is temporary, such as conflict, asylum could also be temporary. There is no reason to confuse short term and long term solutions.

A refugee stops being a refugee once they have found a safe refuge. If they carry on beyond that because another country offers a higher standard of living, they become an economic migrant and should only retain refugee status in that first safe country. It is good policy to ensure that refugees register in the first safe country they come to and Europe should enforce that policy and Europe should choose where to house them, not allow or encourage people to shop around for the best deal. It is entirely possible for the costs of providing them with safe refuge could be distributed among richer nations, wherever they are actually placed. Where asylum in another country is appropriate, asylum seekers should be welcomed as far as socio-economic capacity allows. Few people object to hosting and welcoming genuine asylum seekers.

Economic migrants should apply for immigration according to normal procedures. Those trying to jump the queue by forcing their way in, demonstrating and resisting police, clearly have little respect for the laws and well-being of the countries they wish to enter and should be returned to where they came from and barred from future entry. Looking at the very high proportion of healthy young men among the occasional refugee family, women and children, it is clear that this group represents most of the number currently migrating. Most are not genuine refugees but economic migrants. It is easy to understand that they want a better and wealthier life, hard to see why they should be preferred as an immigrant over a law-abiding and highly skilled alternative. Queue-jumping should result in being put to the back of the queue.

With properly managed policy, safe havens would protect refugees. Those in need of asylum could be provided with it, the rest protected where they are, or even returned to safe havens if they do not properly qualify. With economic migrants turned away and barred from future entry, the numbers attempting the journey would reduce, and with it the number of deaths and the support for terrorist groups.

In closing, I don’t think I have said much that hasn’t been said many times, but adding to the weight of such comment offsets to a small degree to over-emotional and counter-productive sanctimony I see every night on the news. In short, we should do what we can do to help people in danger and distress, but we won’t do that by creating problems in our own country.

Knee-jerk emotional responses that are socially, economically and even militarily unsustainable such as tearing down national boundaries and letting everyone in who has made the journey to our door will make things a lot worse for everyone.

Open your heart and your wallet and help, like the UK has, but don’t switch your brain off, as Germany and others advocate. Germany is not for the first time making Europe a more dangerous place, ironically due to a national guilt trip on account of the previous occasions.

The future of electronic cash and value

 

Picture first, I’m told people like to see pics in blogs. This one is from 1998; only the title has changed since.

future electronic cash

Every once in a while I have to go to a bank. This time it was my 5th attempt to pay off a chunk of my Santander Mortgage. I didn’t know all the account details for web transfer so went to the Santander branch. Fail – they only take cash and cheques. Cash and what??? So I tried via internet banking. Entire transaction details plus security entered, THEN Fail – I exceeded what Barclays allows for their fast transfers. Tried again with smaller amount and again all details and all security. Fail again, Santander can’t receive said transfers, try CHAPS. Tried CHAPS, said it was all fine, all hunkydory. Happy bunny. Double fail. It failed due to amount exceeding limit AND told me it had succeeded when it hadn’t. I then drove 12 miles to my Barclays branch who eventually managed to do it, I think (though I haven’t checked that it worked  yet).

It is 2015. Why the hell is it so hard for two world class banks to offer a service we should have been able to take for granted 20 years ago?

Today, I got tweeted about Ripple Labs and a nice blog that quote their founder sympathising with my experience above and trying to solve it, with some success:

http://www.wfs.org/blogs/richard-samson/supermoney-new-wealth-beyond-banks-and-bitcoin

Ripple seems good as far as it goes, which is summarised in the blog, but do read the full original:

Basically the Ripple protocol “provides the ability for humans to confirm financial transactions without a central operator,” says Larsen. “This is major.” Bitcoin was the first technology to successfully bypass banks and other authorities as transaction validators, he points out, “but our method is much cheaper and takes only seconds rather than minutes.” And that’s just for starters. For example, “It also leverages the enormous power of banks and other financial institutions.”

The power of the value web stems from replacing archaic back-end systems with all their cumbersome delays and unnecessary costs. 

That’s great, I wish them the best of success. It is always nice to see new systems that are more efficient than the old ones, but the idea is early 1990s. Lots of IT people looked at phone billing systems and realised they managed to do for a penny what banks did for 65 pennies at the time, and telco business cases were developed to replace the banks with pretty much what Ripple tries to do. Those were never developed for a variety of reasons, both business and regulatory, but the ideas were certainly understood and developed broadly at engineer level to include not only traditional cash forms but many that didn’t exist then and still don’t. Even Ripple can only process transactions that are equivalent to money such as traditional currencies, electronic cash forms like bitcoin, sea shells or air-miles.

That much is easy, but some forms require other tokens to have value, such as personalized tokens. Some value varies according to queue lengths, time of day, who is spending it to whom. Some needs to be assignable, so you can give money that can only be used to purchase certain things, and may have a whole basket of conditions attached. Money is also only one form of value, and many forms of value are volatile, only existing at certain times and places in certain conditions for certain transactors. Aesthetic cash? Play money? IOUs? Favours?These are  all a bit like cash but not necessarily tradable or exchangeable using simple digital transaction engines because they carry emotional weighting as well as financial value. In the care economy, which is now thankfully starting to develop and is finally reaching concept critical mass, emotional value will become immensely important and it will have some tradable forms, though much will not be tradable ever. We understood all that then, but are still awaiting proper implementation. Most new startups on the web are old ideas finally being implemented and Ripple is only a very partial implementation so far.

Here is one of my early blogs from 1998, using ideas we’d developed several years earlier that were no longer commercially sensitive – you’ll observe just how much banks have under-performed against what we expected of them, and what was entirely feasible using already known technology then:

Future of Money

 Ian Pearson, BT Labs, June 98

Already, people are buying things across the internet. Mostly, they hand over a credit card number, but some transactions already use electronic cash. The transactions are secure so the cash doesn’t go astray or disappear, nor can it easily be forged. In due course, using such cash will become an everyday occurrence for us all.

Also already, electronic cash based on smart cards has been trialled and found to work well. The BT form is called Mondex, but it is only one among several. These smart cards allow owners to ‘load’ the card with small amounts of money for use in transactions where small change would normally be used, paying bus fares, buying sweets etc. The cards are equivalent to a purse. But they can and eventually will allow much more. Of course, electronic cash doesn’t have to be held on a card. It can equally well be ‘stored’ in the network. Transactions then just require secure messaging across the network. Currently, the cost of this messaging makes it uneconomic for small transactions that the cards are aimed at, but in due course, this will become the more attractive option, especially since you no longer lose your cash when you lose the card.

When cash is digitised, it loses some of the restrictions of physical cash. Imagine a child has a cash card. Her parents can give her pocket money, dinner money, clothing allowance and so on. They can all be labelled separately, so that she can’t spend all her dinner money on chocolate. Electronic shopping can of course provide the information needed to enable the cash. She may have restrictions about how much of her pocket money she may spend on various items too. There is no reason why children couldn’t implement their own economies too, swapping tokens and IOUs. Of course, in the adult world this grows up into local exchange trading systems (LETS), where people exchange tokens too, a glorified babysitting circle. But these LETS don’t have to be just local, wider circles could be set up, even globally, to allow people to exchange services or information with each other.

Electronic cash can be versatile enough to allow for negotiable cash too. Credit may be exchanged just as cash and cash may be labelled with source. For instance, we may see celebrity cash, signed by the celebrity, worth more because they have used it. Cash may be labelled as tax paid, so those donations from cards to charities could automatically expand with the recovered tax. Alternatively, VAT could be recovered at point of sale.

With these advanced facilities, it becomes obvious that the cash needs to become better woven into taxation systems, as well as auditing and accounting systems. These functions can be much more streamlined as a result, with less human administration associated with money.

When ID verification is added to the transactions, we can guarantee who it is carrying out the transaction. We can then implement personal taxation, with people paying different amounts for the same goods. This would only work for certain types of purchase – for physical goods there would otherwise be a thriving black market.

But one of the best advantages of making cash digital is the seamlessness of international purchases. Even without common official currency, the electronic cash systems will become de facto international standards. This will reduce the currency exchange tax we currently pay to the banks every time we travel to a different country, which can add up to as much as 25% for an overnight visit. This is one of the justifications often cited for European monetary union, but it is happening anyway in global e-commerce.

Future of banks

 Banks will have to change dramatically from today’s traditional institutions if they want to survive in the networked world. They are currently introducing internet banking to try to keep customers, but the move to digital electronic cash, held perhaps by the customer or an independent third party, will mean that the cash can be quite separate from the transaction agent. Cash does not need to be stored in a bank if records in secured databases anywhere can be digitally signed and authenticated. The customer may hold it on his own computer, or in a cyberspace vault elsewhere. With digital signatures and high network security, advanced software will put the customer firmly in control with access to any facility or service anywhere.

In fact, no-one need hold cash at all, or even move it around. Cash is just bits today, already electronic records. In the future, it will be an increasingly blurred entity, mixing credit, reputation, information, and simply promises into exchangeable tokens. My salary may be just a digitally signed certificate from BT yielding control of a certain amount of credit, just another signature on a long list as the credit migrates round the economy. The ‘promise to pay the bearer’ just becomes a complex series of serial promises. Nothing particularly new here, just more of what we already have. Any corporation or reputable individual may easily capture the bank’s role of keeping track of the credit. It is just one service among many that may leave the bank.

As the world becomes increasingly networked, the customer could thus retain complete control of the cash and its use, and could buy banking services on a transaction by transaction basis. For instance, I could employ one company to hold my cash securely and prevent its loss or forgery, while renting the cash out to companies that want to borrow via another company, keeping the bulk of the revenue for myself. Another company might manage my account, arrange transfers etc, and deal with the taxation, auditing etc. I could probably get these done on my personal computer, but why have a dog and bark yourself.

The key is flexibility, none of these services need be fixed any more. Banks will not compete on overall package, but on every aspect of service. Worse still (for the banks), some of their competitors will be just freeware agents. The whole of the finance industry will fragment. The banks that survive will almost by definition be very adaptable. Services will continue and be added to, but not by the rigid structures of today. Surviving banks should be able to compete for a share of the future market as well as anyone. They certainly have a head start in many of the required skills, and have the advantage of customer lethargy when it comes to changing to potentially better suppliers. Many of their customers will still value tradition and will not wish to use the better and cheaper facilities available on the network. So as always, it looks like there will be a balance.

Firstly, with large numbers of customers moving to the network for their banking services, banks must either cater for this market or become a niche operator, perhaps specialising in tradition, human service and even nostalgia. Most banks however will adapt well to network existence and will either be entirely network based, or maintain a high street presence to complement their network presence.

High Street banking

 Facilities in high street banking will echo this real world/cyberspace nature. It must be possible to access network facilities from within the banks, probably including those of competitors. The high street bank may therefore be more like shops today, selling wares from many suppliers, but with a strongly placed own brand. There is of course a niche for banks with no services of their own at all who just provide access to services from other suppliers. All they offer in addition is a convenient and pleasant place to access them, with some human assistance as appropriate.

Traditional service may sometimes be pushed as a differentiator, and human service is bound to attract many customers too. In an increasingly machine dominated world, actually having the right kind of real people may be significant value add.

But many banks will be bursting with high technology either alongside or in place of people. Video terminals to access remote services, perhaps with translation to access foreign services. Biometric identification based on iris scan, fingerprints etc may be used to authenticate smart cards, passports or other legal documents before their use, or simply a means of registering securely onto the network. High quality printers and electronic security embedding would enable banks to offer additional facilities like personal bank notes, usable as cash.

Of course, banks can compete in any financial service. Because the management of financial affairs gives them a good picture of many customer’s habits and preferences, they will be able to use this information to sell customer lists, identify market niches for new businesses, and predict the likely success of customers proposing setting up businesses.

As they try to stretch their brands into new territories, one area they may be successful is in information banking. People may use banks as the publishers of the future. Already knowledge guilds are emerging. Ultimately, any piece of information from any source can be marketed at very low publishing and distribution cost, making previously unpublishable works viable. Many people have wanted to write, but have been unable to find publishers due to the high cost of getting to market in paper. A work may be sold on the network for just pennies, and achieve market success by selling many more copies than could have been achieved by the high priced paper alternative. The success of electronic encyclopedias and the demise of Encyclopedia Britannica is evidence of this. Banks could allow people to upload information onto the net, which they would then manage the resultant financial transactions. If there aren’t very many, the maximum loss to the bank is very small. Of course, electronic cash and micropayment technology mean that the bank is not necessary, but for many, it may smooth the road.

Virtual business centres

Their exposure to the detailed financial affairs of the community put banks in a privileged position in identifying potential markets. They could therefore act as co-ordinators for virtual companies and co-operatives. Building on the knowledge guilds, they could broker the skills of their many customers to existing virtual companies and link people together to address business needs not addressed by existing companies, or where existing companies are inadequate or inefficient. In this way, short-term contractors, who may dominate the employment community, can be efficiently utilised to everyone’s gain. The employees win by getting more lucrative work, their customers get more efficient services at lower cost, and the banks laugh to themselves.

Future of the stock market

 In the next 10 years, we will probably see a factor of 1000 in computer speed and memory capacity. In parallel with hardware development, there are numerous research forays into software techniques that might yield more factors of 10 in the execution speed for programs. Tasks that used to take a second will be reduced to a millisecond. As if this impact were not enough, software will very soon be able to make logical deductions from the flood of information on the internet, not just from Reuters or Bloomberg, but from anywhere. They will be able to assess the quality and integrity of the data, correlate it with other data, run models, and infer likely other events and make buy or sell recommendations. Much dealing will still be done automatically subject to human-imposed restrictions, and the speed and quality of this dealing could far exceed current capability.

Which brings problems…

Firstly, the speed of light is fast but finite. With these huge processing speeds, computers will be able to make decisions within microseconds of receiving information. Differences in distance from the information source become increasingly important. Being just 200m closer to the Bank of England makes one microsecond difference to the time of arrival of information on interest rates, the information, insignificant to a human, but of sufficient duration for a fast computer to but or sell before competitors even receive the information. As speeds increase further over following years, the significant distance drops. This effect will cause great unfairness according to geographic proximity to important sources. There are two obvious outcomes. Either there becomes a strong premium on being closest, with rises in property values nearby to key sources, or perhaps network operators could be asked to provide guaranteed simultaneous delivery of information. This is entirely technically feasible but would need regulation, otherwise users could simply use alternative networks.

Secondly, exactly simultaneous processing will cause problems. If many requests for transactions arrive at exactly the same moment, computers or networks have to give priority in some way. This is bound to be a source of contention. Also, simultaneous events can often cause malfunctions, as was demonstrated perfectly at the launch of Big Bang. Information waves caused by such events are a network phenomenon that could potentially crash networks.

Such a delay-sensitive system may dictate network technology. Direct transmission through the air by means of radio or infrared (optical wireless) would be faster than routing signals through fibres that take a more tortuous route, especially since the speed of light in fibre is only two third that in air.

Ultimately, there is a final solution if speed of computing increases so far that transmission delay is too big a problem. The processing engines could actually be shared, with all the deals and information processing taking place in a central computer, using massive parallelism. It would be possible to construct such a machine that treated each subscribing company fairly.

An interesting future side effect of all this is that the predicted flood of people into the countryside may be averted. Even though people can work from anywhere, their computers have to be geographically very close to the information centres, i.e. the City. Automated dealing has to live in the city, human based dealing can work from anywhere. If people and machines have to work together, perhaps they must both work in the City.

Consumer dealing

 The stock exchange long since stopped being a trading floor with scraps of paper and became a distributed computer environment – it effectively moved into cyberspace. The deals still take place, but in cyberspace. There are no virtual environments yet, but the other tools such as automated buying and selling already exist. These computers are becoming smarter and exist in cyberspace every bit the same as the people. As a result, there is more automated analysis, more easy visualisation and more computer assisted dealing. People will be able to see which shares are doing well, spot trends and act on their computer’s advice at a button push. Markets will grow for tools to profit from shares, whether they be dealing software, advice services or visualisation software.

However, as we see more people buying personal access to share dealing and software to determine best buys, or even to automatically buy or sell on certain clues, we will see some very negative behaviours. Firstly, traffic will be highly correlated if personal computers can all act on the same information at the same time. We will see information waves, and also enormous swings in share prices. Most private individuals will suffer because of this, while institutions and individuals with better software will benefit. This is because prices will rise and fall simply because of the correlated activity of the automated software and not because of any real effects related to the shares themselves. Institutions may have to limit private share transactions to control this problem, but can also make a lot of money from modelling the private software and thus determining in advance what the recommendations and actions will be, capitalising enormously on the resultant share movements, and indeed even stimulating them. Of course, if this problem is generally perceived by the share dealing public, the AI software will not take off so the problem will not arise. What is more likely is that such software will sell in limited quantities, causing the effects to be significant, but not destroying the markets.

A money making scam is thus apparent. A company need only write a piece of reasonably good AI share portfolio management software for it to capture a fraction of the available market. The company writing it will of course understand how it works and what the effects of a piece of information will be (which they will receive at the same time), and thus able to predict the buying or selling activity of the subscribers. If they were then to produce another service which makes recommendations, they would have even more notice of an effect and able to directly influence prices. They would then be in the position of the top market forecasters who know their advice will be self fulfilling. This is neither insider dealing nor fraud, and of course once the software captures a significant share, the quality of its advice would be very high, decoupling share performance from the real world. Only the last people to react would lose out, paying the most, or selling at least, as the price is restored to ‘correct’ by the stock exchange, and of course even this is predictable to a point. The fastest will profit most.

The most significant factor in this is the proportion of share dealing influenced by that companies software. The problem is that software markets tend to be dominated by just two or three companies, and the nature of this type of software is that their is strong positive reinforcement for the company with the biggest influence, which could quickly lead to a virtual monopoly. Also, it really doesn’t matter whether the software is on the visualisation tools or AI side. Each can have a predictability associated with it.

It is interesting to contemplate the effects this widespread automated dealing would have of the stock market. Black Monday is unlikely to happen again as a result of computer activity within the City, but it certainly looks like prices will occasionally become decoupled from actual value, and price swings will become more significant. Of course, much money can be made on predicting the swings or getting access to the software-critical information before someone else, so we may see a need for equalised delivery services. Without equalised delivery, assuming a continuum of time, those closest to the dealing point will be able to buy or sell quicker, and since the swings could be extremely rapid, this would be very important. Dealers would have to have price information immediately, and of course the finite speed of light does not permit this. If dealing time is quantified, i.e. share prices are updated at fixed intervals, the duration of the interval becomes all important, strongly affect the nature of the market, i.e. whether everyone in that interval pays the same or the first to act gain.

Also of interest is the possibility of agents acting on behalf of many people to negotiate amongst themselves to increase the price of a company’s shares, and then sell on a pre-negotiated time or signal.

Such automated  systems would also be potentially vulnerable to false information from people or agents hoping to capitalise on their correlated behaviour.

Legal problems are also likely. If I write, and sell to a company, a piece of AI based share dealing software which learns by itself how stock market fluctuations arise, and then commits a fraud such as insider dealing (I might not have explained the law, or the law may have changed since it was written), who would be liable?

 And ultimately

 Finally, the 60s sci-fi film, The Forbin Project, considered a world where two massively powerful computers were each assigned control of competing defence systems, each side hoping to gain the edge. After a brief period of cultural exchange, mutual education and negotiation between the machines, they both decided to co-operate rather than compete, and hold all mankind at nuclear gunpoint to prevent wars. In the City of the future, similar competition between massively intelligent supercomputers in share dealing may have equally interesting consequences. Will they all just agree a fixed price and see the market stagnate instantly, or could the system result in economic chaos with massive fluctuations. Perhaps we humans can’t predict how machines much smarter than us would behave. We may just have to wait and see.

End of original blog piece

 

 

Technology 2040: Technotopia denied by human nature

This is a reblog of the Business Weekly piece I wrote for their 25th anniversary.

It’s essentially a very compact overview of the enormous scope for technology progress, followed by a reality check as we start filtering that potential through very imperfect human nature and systems.

25 years is a long time in technology, a little less than a third of a lifetime. For the first third, you’re stuck having to live with primitive technology. Then in the middle third it gets a lot better. Then for the last third, you’re mainly trying to keep up and understand it, still using the stuff you learned in the middle third.

The technology we are using today is pretty much along the lines of what we expected in 1990, 25 years ago. Only a few details are different. We don’t have 2Gb/s per second to the home yet and AI is certainly taking its time to reach human level intelligence, let alone consciousness, but apart from that, we’re still on course. Technology is extremely predictable. Perhaps the biggest surprise of all is just how few surprises there have been.

The next 25 years might be just as predictable. We already know some of the highlights for the coming years – virtual reality, augmented reality, 3D printing, advanced AI and conscious computers, graphene based materials, widespread Internet of Things, connections to the nervous system and the brain, more use of biometrics, active contact lenses and digital jewellery, use of the skin as an IT platform, smart materials, and that’s just IT – there will be similarly big developments in every other field too. All of these will develop much further than the primitive hints we see today, and will form much of the technology foundation for everyday life in 2040.

For me the most exciting trend will be the convergence of man and machine, as our nervous system becomes just another IT domain, our brains get enhanced by external IT and better biotech is enabled via nanotechnology, allowing IT to be incorporated into drugs and their delivery systems as well as diagnostic tools. This early stage transhumanism will occur in parallel with enhanced genetic manipulation, development of sophisticated exoskeletons and smart drugs, and highlights another major trend, which is that technology will increasingly feature in ethical debates. That will become a big issue. Sometimes the debates will be about morality, and religious battles will result. Sometimes different parts of the population or different countries will take opposing views and cultural or political battles will result. Trading one group’s interests and rights against another’s will not be easy. Tensions between left and right wing views may well become even higher than they already are today. One man’s security is another man’s oppression.

There will certainly be many fantastic benefits from improving technology. We’ll live longer, healthier lives and the steady economic growth from improving technology will make the vast majority of people financially comfortable (2.5% real growth sustained for 25 years would increase the economy by 85%). But it won’t be paradise. All those conflicts over whether we should or shouldn’t use technology in particular ways will guarantee frequent demonstrations. Misuses of tech by criminals, terrorists or ethically challenged companies will severely erode the effects of benefits. There will still be a mix of good and bad. We’ll have fixed some problems and created some new ones.

The technology change is exciting in many ways, but for me, the greatest significance is that towards the end of the next 25 years, we will reach the end of the industrial revolution and enter a new age. The industrial revolution lasted hundreds of years, during which engineers harnessed scientific breakthroughs and their own ingenuity to advance technology. Once we create AI smarter than humans, the dependence on human science and ingenuity ends. Humans begin to lose both understanding and control. Thereafter, we will only be passengers. At first, we’ll be paying passengers in a taxi, deciding the direction of travel or destination, but it won’t be long before the forces of singularity replace that taxi service with AIs deciding for themselves which routes to offer us and running many more for their own culture, on which we may not be invited. That won’t happen overnight, but it will happen quickly. By 2040, that trend may already be unstoppable.

Meanwhile, technology used by humans will demonstrate the diversity and consequences of human nature, for good and bad. We will have some choice of how to use technology, and a certain amount of individual freedom, but the big decisions will be made by sheer population numbers and statistics. Terrorists, nutters and pressure groups will harness asymmetry and vulnerabilities to cause mayhem. Tribal differences and conflicts between demographic, religious, political and other ideological groups will ensure that advancing technology will be used to increase the power of social conflict. Authorities will want to enforce and maintain control and security, so drones, biometrics, advanced sensor miniaturisation and networking will extend and magnify surveillance and greater restrictions will be imposed, while freedom and privacy will evaporate. State oppression is sadly as likely an outcome of advancing technology as any utopian dream. Increasing automation will force a redesign of capitalism. Transhumanism will begin. People will demand more control over their own and their children’s genetics, extra features for their brains and nervous systems. To prevent rebellion, authorities will have little choice but to permit leisure use of smart drugs, virtual escapism, a re-scoping of consciousness. Human nature itself will be put up for redesign.

We may not like this restricted, filtered, politically managed potential offered by future technology. It offers utopia, but only in a theoretical way. Human nature ensures that utopia will not be the actual result. That in turn means that we will need strong and wise leadership, stronger and wiser than we have seen of late to get the best without also getting the worst.

The next 25 years will be arguably the most important in human history. It will be the time when people will have to decide whether we want to live together in prosperity, nurturing and mutual respect, or to use technology to fight, oppress and exploit one another, with the inevitable restrictions and controls that would cause. Sadly, the fine engineering and scientist minds that have got us this far will gradually be taken out of that decision process.