Monday, 29 May 2017

Global Reset: Upgrading Society in the Digital Age

By Dirk Helbing



We are free. We are free to reinvent the world as we like. Most people have not realized it yet. However, even though the US military budget exceeds that of all other countries in the world together, the era of American supremacy has ended. Now that the USA needs to focus on its own domestic affairs, and we are left free to make our own choices. The people of the world can finally figure out their own ways of living – now that they have to. It is no longer necessary to wait until the USA and its strategic think tanks tell the rest of the world what to do.

This is actually a historic opportunity – for us, for the world, and for America, too. The America-dominated era had industrialized the world, and created previously unseen levels of luxury. It also created a financial industry to make it happen, and a digital infrastructure to watch and control the world. Yet, it has failed to solve the existential challenges of our planet: climate change, environmental destruction, resource depletion. This lack of sustainability is causing wars, mass migration, and a future heading for disaster. A new approach – one that brings people and nature in balance – is urgently needed.

It turns out that the reinvention of the world has already started. The digital revolution provides us the tools for a new historical age. Within the space of a few years, we have seen many new technologies, ranging from cloud computing to Big Data, from Artificial Intelligence (AI) to cognitive computing to robotics, from the Internet of Things to Blockchain technology, from Virtual Reality to 3D printing. Now is the perfect storm. All products, services, and business models can be digitally reinvented – and it is happening right now.

The world’s attention has turned to Google’s self-driving cars, Tesla’s electrical cars, and Uber’s transport as a service. While Germany, once famous for its car industry, has plagued by the diesel emission scandals. Suddenly, new players (such as Uber and Tesla) and outsiders (such as Google when it comes to cars) are invading well-established sectors of economy. And this is just the beginning...

The company AirBnb, even though it does not own any hotels, now sells the most overnight stays in the world. Bitcoin has reinvented money, and banks have started to worry about their future. 3D printers can now build entire houses in a single day for just 10,000 Dollars, and  a 57-storey skyscraper has been built in just 3 weeks. This is a revolution!

The digital revolution is also behind a new wave of automation – and it is bigger than any such wave before. Artificial intelligence systems can now read text, talk, and translate languages in real-time. They can recognize patterns and contents of pictures. They can learn anything that works according to rules or is repetitive. AI systems can therefore potentially take over anything from to administration of medical diagnoses, to jurisdiction. AI technology threatens not only low-skilled labour, but also white-collar jobs.

It becomes increasingly clear that no sector of economy will stay the same, and all institutions of society will change – without exception and within a very short time. For Europe, this is a particular concern, because the leading hardware, software, and data companies (with very few exceptions) are located in other continents. Even though “industry 4.0” seems to be successful in creating automated solutions for industrial production – do you know the names of the leading companies?.

This is probably a side effect of globalization as we know it. We thought that we do not have to excel in every single technology, and that every country would specialise in producing what it is best in, and buy the other technologies elsewhere. However, in the case of digital technologies, this was obviously a mistake. Now, we depend on hardware, software, and data we can’t trust anymore. As we will later see, the sovereignty of people, companies and countries is seriously under threat.

To date, it appears that Europe lacks a coherent digital strategy. We have a digital single market, but what are the products and services? Even if Europe would now manage to mobilize the capital, the patents, the technologies and labour force to generate the same growth rate as the Silicon Valley – this backlog would grow further and increasingly faster, because of the exponentially accelerating nature of the digital sector. This in principle would apply, if we continue the same digitization strategy.

However, there are alternatives. One approach that promises to produce faster than exponential growth is combinatorial innovation. This would be based on openness, and require sufficient interoperability based on a reciprocity principle in order not to be exploited. Such an approach would produce a participatory information and innovation ecosystem, in which everyone could benefit from.

The possibilities of the digital realm are unlimited, because the digital world is non-material in nature. This is a game-changer. If we understand and use this well, we can live in a world of sustainability, prosperity and peace. We could be world leaders in the creation of this new age – a new historical era! So, what are we waiting for?

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