The technology behind bitcoin lets people who do not know or trust each other build a dependable ledger. This has implications far beyond the cryptocurrency ... lack of secure property rights is an endemic source of insecurity and injustice. It also makes it harder to use a house or a piece of land as collateral, stymying investment and job creation. ... Such problems seem worlds away from bitcoin, a currency based on clever cryptography which has a devoted following among mostly well-off, often anti-government and sometimes criminal geeks. But the cryptographic technology that underlies bitcoin, called the “blockchain”, has applications well beyond cash and currency. It offers a way for people who do not know or trust each other to create a record of who owns what that will compel the assent of everyone concerned. It is a way of making and preserving truths. ... Other applications for blockchain and similar “distributed ledgers” range from thwarting diamond thieves to streamlining stockmarkets: the NASDAQ exchange will soon start using a blockchain-based system to record trades in privately held companies. The Bank of England, not known for technological flights of fancy, seems electrified: distributed ledgers, it concluded in a research note late last year, are a “significant innovation” that could have “far-reaching implications” in the financial industry. ... Some of bitcoin’s critics have always seen it as the latest techy attempt to spread a “Californian ideology” which promises salvation through technology-induced decentralisation while ignoring and obfuscating the realities of power—and happily concentrating vast wealth in the hands of an elite. The idea of making trust a matter of coding, rather than of democratic politics, legitimacy and accountability, is not necessarily an appealing or empowering one.
Farms, then, are becoming more like factories: tightly controlled operations for turning out reliable products, immune as far as possible from the vagaries of nature. Thanks to better understanding of DNA, the plants and animals raised on a farm are also tightly controlled. Precise genetic manipulation, known as “genome editing”, makes it possible to change a crop or stock animal’s genome down to the level of a single genetic “letter”. This technology, it is hoped, will be more acceptable to consumers than the shifting of whole genes between species that underpinned early genetic engineering, because it simply imitates the process of mutation on which crop breeding has always depended, but in a far more controllable way. ... Understanding a crop’s DNA sequence also means that breeding itself can be made more precise. You do not need to grow a plant to maturity to find out whether it will have the characteristics you want. A quick look at its genome beforehand will tell you. ... Such technological changes, in hardware, software and “liveware”, are reaching beyond field, orchard and byre. Fish farming will also get a boost from them. And indoor horticulture, already the most controlled and precise type of agriculture, is about to become yet more so. ... In the short run, these improvements will boost farmers’ profits, by cutting costs and increasing yields, and should also benefit consumers (meaning everyone who eats food) in the form of lower prices. In the longer run, though, they may help provide the answer to an increasingly urgent question: how can the world be fed in future without putting irreparable strain on the Earth’s soils and oceans?
Next year it will be 60 years since people first witnessed the majesty of a satellite being launched into orbit: Sputnik 1, hurled into the night sky in Kazakhstan early on October 5th 1957. ... Just 15 years separated the launch of the first satellite and the return of the last man from the moon, years in which anything seemed possible. But having won the space race, America saw no benefit in carrying on. Instead it developed a space shuttle meant to make getting to orbit cheap, reliable and routine. More than 100 shuttle flights between 1981 to 2011 went some way to realising the last of those goals, despite two terrible accidents. The first two were never met. Getting into space remained a risky and hideously expensive proposition, taken up only by governments and communications companies, each for their own reasons. ... New rockets, though, are not the only exciting development. The expense of getting into space during the 1980s and 1990s led some manufacturers to start shrinking the satellites used for some sorts of mission, creating “smallsats”. Since then the amount a given size of satellite can do has been boosted by developments in computing and electronics. This has opened up both new ways of doing old jobs and completely novel opportunities. ... No single technology ties together this splendid gaggle of ambitions. But there is a common technological approach that goes a long way to explaining it; that of Silicon Valley. Even if for now most of the money being spent in space remains with old government programmes and incumbent telecom providers, space travel is moving from the world of government procurement and aerospace engineering giants to the world of venture-capital-funded startups and business plans that rely on ever cheaper services provided to ever more customers.
The myth around which the EU has grown is that ministers and their officials always planned gradually, but inexorably, to subordinate the nation state to a higher European order. In the words of Vaclav Klaus, a former prime minister of the Czech Republic, countries would “dissolve in Europe like a lump of sugar in a cup of coffee”. But although Monnet and some of those around him did indeed dream of a European superstate, the politicians who made use of their ideas did not. The pooling of sovereignty found in the treaties first of Paris and then of Rome—which created the European Economic Community in 1957—was designed to save the nation state, not bury it. Europe’s governments have jealously guarded their powers ever since. ... If one key aspect of Europe has stayed constant, another has come full circle. Monnet’s scheme was an answer to the problem of Germany: too large to co-exist as a first among equals, too small to dominate its neighbours without resort to force. It was, for a long time, a good answer. For 65 years Germany has been prepared to subsume itself in Europe and, in exchange, has been allowed to act as a full member of the Western alliance. Today, by dint of unification and EU enlargement as well as its mighty economy, Germany runs Europe. ... Nobody thinks Europe’s great power is about to take up arms. But what sort of union does it want? ... The EU was not predestined, but makeshift. In the frantic politics of the post-war world other Europes were possible. But the one that actually came into being has been oddly durable. The fretful union of today, dominated by governments that scrap and bicker and backslide, is not an aberration. It is how things began. ... Leaders rarely act without a crisis to spur them on, and as a result their remedies are often inadequate.
If water is not managed better, today’s crisis will become a catastrophe. By the middle of the century more than half of the planet will live in areas of “water stress”, where supplies cannot sustainably meet demand. ... Where water is available, when and in what condition matters hugely. About 97% of the water on earth is salty; the rest is replenished through seasonal rainfall or is stored in underground wells known as aquifers. Humans, who once settled where water was plentiful, are now inclined to shift around to places that are less well endowed, pulled by other economic forces. ... As people get richer, they use more water. They also “consume” more of it, which means using it in such a way that it is not quickly returned to the source from which it was extracted. ... To make matters worse, few places price water properly. Usually, it is artificially cheap, because politicians are scared to charge much for something essential that falls from the sky. This means that consumers have little incentive to conserve it and investors have little incentive to build pipes and other infrastructure to bring it to where it is needed most. ... around a fifth of the world’s aquifers are over-exploited. This jeopardises future use by causing contamination. It also damages the layers of sand and clay that make up aquifers, thereby reducing their capacity to be replenished. ... People do not drink much water—only a few litres a day. But putting food on their tables requires floods of the stuff. Growing 1kg of wheat takes 1,250 litres of water; fattening a cow to produce the same weight of beef involves 12 times more. Overall, agriculture accounts for more than 70% of global freshwater withdrawals. ... estimated that agricultural production will have to rise by 60% to fill the world’s bellies. This will put water supplies under huge strain. ... Hydrologists expect that a warming climate will see the cycle of evaporation, condensation and precipitation speed up. ... There is no single solution for the world’s water crisis. But cutting back on use, improving the efficiency of that use and sharing out water more effectively would all help.
In the next 15 years India will see more people come online than any other country. Last year e-commerce sales were about $16 billion; by 2020, according to Morgan Stanley, a bank, the online retail market could be more than seven times larger. Such sales are expected to grow faster in India than in any other market. This has attracted a flood of investment in e-commerce firms, the impact of which may go far beyond just displacing offline retail. ... India’s small businesses have limited access to loans; most of its consumers do not have credit cards, or for that matter credit. The e-commerce companies are investing in logistics, helping merchants borrow and giving consumers new tools to pay for goods. ... Amazon wants to make India its second-biggest market, after America. For the time being, though, with just 12% of the market, it lags behind the home-grown successes, Flipkart (45%) and Snapdeal (26%). All three, as well as some smaller competitors, are spending at a blistering rate. ... The prospect of a second market growing to a near-Chinese size attracts those who made a packet the first time round. ... Indian regulations bar foreign-backed e-commerce firms from owning inventory, and so acting as a straightforward retailer is not an option. As a result India’s top e-commerce companies look much more like Alibaba.
The difference between the 4004 and the Skylake is the difference between computer behemoths that occupy whole basements and stylish little slabs 100,000 times more powerful that slip into a pocket. It is the difference between telephone systems operated circuit by circuit with bulky electromechanical switches and an internet that ceaselessly shuttles data packets around the world in their countless trillions. It is a difference that has changed everything from metal-bashing to foreign policy, from the booking of holidays to the designing of H-bombs. ... Moore’s law is not a law in the sense of, say, Newton’s laws of motion. But Intel, which has for decades been the leading maker of microprocessors, and the rest of the industry turned it into a self-fulfilling prophecy. ... That fulfilment was made possible largely because transistors have the unusual quality of getting better as they get smaller; a small transistor can be turned on and off with less power and at greater speeds than a larger one. ... “There’s a law about Moore’s law,” jokes Peter Lee, a vice-president at Microsoft Research: “The number of people predicting the death of Moore’s law doubles every two years.” ... making transistors smaller has no longer been making them more energy-efficient; as a result, the operating speed of high-end chips has been on a plateau since the mid-2000s ... while the benefits of making things smaller have been decreasing, the costs have been rising. This is in large part because the components are approaching a fundamental limit of smallness: the atom. ... One idea is to harness quantum mechanics to perform certain calculations much faster than any classical computer could ever hope to do. Another is to emulate biological brains, which perform impressive feats using very little energy. Yet another is to diffuse computer power rather than concentrating it, spreading the ability to calculate and communicate across an ever greater range of everyday objects in the nascent internet of things. ... in 2012 the record for maintaining a quantum superposition without the use of silicon stood at two seconds; by last year it had risen to six hours. ... For a quantum algorithm to work, the machine must be manipulated in such a way that the probability of obtaining the right answer is continually reinforced while the chances of getting a wrong answer are suppressed.
Despite years of economic growth, popular discontent at widespread corruption has grown stronger. A series of scandals about everything from shoddy housing to out-of-date vaccines has led to public cynicism about companies and the government’s ability to enforce rules. Social-credit scoring aims to change that by cracking down on the corrupt officials and companies that plague Chinese life. And it aims to keep a closer track on public opinion. In a society with few outlets for free expression, big data might paradoxically help make institutions more accountable. ... But it could also vastly increase snooping and social control. In other countries there have been many scare stories about Big Data leading to Big Brother. Most have proven false. But China is different. It is a one-party state, with few checks on its power, a tradition of social control and, in President Xi Jinping, a leader even more prone to authoritarianism than his immediate predecessors. The extent of social-credit scoring will depend on what the government intends, whether the technology works and how the party responds to public concerns. ... China treats personal information differently from the West. In democracies, laws limit what companies may do with it and the extent to which governments can get their hands on it. Such protections are imperfect everywhere. But in China they do not exist. The national-security law and the new cyber-security law give the government unrestricted access to almost all personal data.
Imperial Viennese society could not survive. But the ideas and art brought forth during the fecund period of Viennese history from the late 1880s to the 1920s endured—from Loos’s modernist architecture to Gustav Klimt’s symbolist canvasses, from Schoenberg’s atonal music and Mahler’s Sturm und Drang to Ludwig Wittgenstein’s philosophy. Those Viennese who escaped Nazism went on to sustain the West during the cold war, and to restore the traditions of empiricism and liberal democracy. ... This ferment was part of a generational revolution that swept Europe at the end of the 19th century, from Berlin to London. But the Viennese rebellion was more intense, and more wide-ranging. And it provoked a more extreme reaction. Hitler arrived in Vienna from the Austrian provinces in 1908 and developed his theories of race and power there. Vienna was thus the cradle of modernism and fascism, liberalism and totalitarianism: the currents that have shaped much of Western thought and politics since Vienna itself started to implode in 1916 until the present day. It has been the Viennese century. ... Amid a babble of peoples and languages—one in which, as elsewhere at the time, gender roles were being redefined—Viennese thinking was driven by an urge to find universal forms of communication. ... Often the Viennese intellectuals leapt ahead by transferring knowledge gained in one discipline to others, gloriously indifferent to the mind-forged manacles that have come to stifle modern academia and research. ... Von Mises and Hayek, one of his students, saw earlier than most that by the interwar years the liberal era in Europe was being overwhelmed by the collectivism and totalitarianism of the right and the left. They subsequently devoted their lives to reversing the tide. ... The Viennese school placed the lived experience of individuals—rather than the abstractions of class, race and nationalism favoured by their opponents—at the heart of their intellectual enterprises.
In rich countries the link between learning and earning has tended to follow a simple rule: get as much formal education as you can early in life, and reap corresponding rewards for the rest of your career. The literature suggests that each additional year of schooling is associated with an 8-13% rise in hourly earnings. ... Many believe that technological change only strengthens the case for more formal education. Jobs made up of routine tasks that are easy to automate or offshore have been in decline. The usual flipside of that observation is that the number of jobs requiring greater cognitive skill has been growing. ... The reality seems to be more complex. The returns to education, even for the high-skilled, have become less clear-cut. Between 1982 and 2001 the average wages earned by American workers with a bachelor’s degree rose by 31%, whereas those of high-school graduates did not budge, according to the New York Federal Reserve. But in the following 12 years the wages of college graduates fell by more than those of their less educated peers. Meanwhile, tuition costs at universities have been rising. ... automation tends to affect tasks within an occupation rather than wiping out jobs in their entirety. Partial automation can actually increase demand by reducing costs
- Also: The Economist - Cognition switch: What employers can do to encourage their workers to retrain < 5min
- Also: The Economist - Old dogs, new tricks: How older employees perform in the workplace < 5min
- Also: The Economist - The return of the MOOC: Established education providers v new contenders < 5min
- Also: The Economist - Pathway dependency: Turning qualifications into jobs < 5min
- Also: The Economist - The elephant in the truck: Retraining low-skilled workers < 5min
- Also: The Economist - Manufacturing industry: Politicians cannot bring back old-fashioned factory jobs 5-15min
De Beers, the world’s biggest diamond company, marked the opening of its Gahcho Kué mine in September. ... the aim of extracting more than 12,000 carats (2.4kg) of diamonds each day. Gahcho Kué is an astonishing endeavour, the biggest new mine in the world in over a decade. De Beers has no plans for another. ... The diamond business gained its sparkle around 1866, when a farmer’s son picked up a glistening pebble on the bank of the Orange river in South Africa. For most of the next 150 years, De Beers would dominate the global market. Success depended on manipulated supply and skilfully cultivated demand. ... Much has changed since then. De Beers can no longer control the market. Though it is the biggest producer by value, it accounts for only a third of global sales, down from 45% in 2007. It faces many uncertainties, from synthetic diamonds to changing relationships with polishers and cutters. Its loosening grip is reflected in increased volatility: its sales fell 34% in 2015, before bouncing back by 30% last year. Meanwhile the source of the demand that drives sales—the link between diamonds and love—looks weaker than it used to. ... But one forecast seems solid: there will be fewer new diamonds. ... diamonds’ principal value has nothing to do with science. ... They are a “Veblen good”, as items that gain their value solely from their ability to signal status are named, after Thorstein Veblen, an economist who wrote about the spending of the rich.
After decades of work in the laboratory, a raft of different devices and approaches relying on quantum-mechanical effects are now nearing market-readiness. It has taken so long mainly because the components that make them up had to be developed first: ever-better lasers, semiconductors, control electronics and techniques to achieve the low temperatures at which many quantum systems perform best. ... Everything in the natural world can be described by quantum mechanics. Born a century ago, this theory is the rule book for what happens at atomic scales, providing explanations for everything from the layout of the periodic table to the zoo of particles spraying out of atom-smashers. It has guided the development of everyday technologies from lasers to MRI machines and put a solid foundation under astrophysicists’ musings about unknowables such as the interiors of black holes and the dawn of the universe. Revealed by a few surprising discoveries, such as that atoms absorb and emit energy only in packets of discrete sizes (quanta), and that light and matter can act as both waves and particles, it is modern physics’ greatest triumph. ... It has a weird side, though, and it is this that has captured interest in what is now being called the second quantum revolution.
Parking can seem like the most humdrum concern in the world. Even planners, who thrill to things like zoning and floor-area ratios, find it unglamorous. But parking influences the way cities look, and how people travel around them, more powerfully than almost anything else. Many cities try to make themselves more appealing by building cycle paths and tram lines or by erecting swaggering buildings by famous architects. If they do not also change their parking policies, such efforts amount to little more than window-dressing. There is a one-word answer to why the streets of Los Angeles look so different from those of London, and why neither city resembles Tokyo: parking. ... For as long as there have been cars, there has been a need to store them when they are not moving—which, these days, is about 95% of the time. Washington, DC, had a parking garage in 1907, before Ford produced its first Model T. But the most important innovation came in 1923, when Columbus, in Ohio, began to insist that builders of flats create parking spaces for the people who would live in them. “Parking minimums”, as these are known, gradually spread across America. Now, as the number of cars on the world’s roads continues to grow (see chart), they are spreading around the world. ... Free parking represents a subsidy for older people that is paid disproportionately by the young and a subsidy for the wealthy that is paid by the poor.
They think Amazon is going to grow faster, longer and bigger than almost any firm in history ... only ten firms with sales of more than $50bn have managed to grow by an average of 15% or more for ten years straight since 1950; no company with sales of more than $100bn has done so. If Amazon were to pull it off, it would be the most aggressive expansion of a giant company in the history of modern business. ... That raises two questions. The first is how Amazon could possibly achieve this. The second is which industries it might upend in the process. ... Mr Bezos claims, as a corollary to thinking only of customers, never to think of rivals. However, the list of current and possible competitors that Amazon is required to include in its annual filings is long and getting longer. It ranges from retailers and search engines to film producers and, as of last year, logistics and advertising firms. ... the best defence is simple: sell something that customers want and Amazon does not have. Exceptional merchandise and service helps.