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Innovation or stagnation – a great debate

13 Nov 2012

Oxford’s historic Union was buzzing with anticipation. On one side, arguably the greatest chess player of all time, Garry Kasparov, and perhaps Silicon Valley’s most successful and visionary innovator, Peter Thiel. On the other, a technology entrepreneur who was the first African in space, Mark Shuttleworth, and one of Harvard’s best and most influential economists, Professor Kenneth Rogoff.

The subject for Oxford Martin School’s first Oxford Union debate was innovation. Kasparov/Thiel argued for the motion that “the current growth crisis is a result of technological stagnation in a risk-averse society."  Shuttleworth/Rogoff argued against.

Kasparov outlined many of the greatest innovations of our time, from antibiotics and computers to cell phones and satellites. But, he noted “the nature of innovation has changed,” describing current innovations as “incremental” built on technological developments made in the 50s’ 60s and 70s. “Can we compare the impact of the iPhone 5 with Apollo 5?” he asked. Not only are we stalled in many areas including life expectancy, energy production and speed of travel, the psychology of our society has changed.  Kasparov believes that avoiding risk has become a top priority for businesses, but, he said “innovation is risk” and “risk is an indispensible part of success in capitalist society.”

If progress is driven by technology something has changed in a radical way, said Peter Thiel, citing that average US wages rose by 350% between 1932 and 1972, but by only 22% from 1972 to 2012. “Most of the people in the West believe that the next generation will be less well off than the current one,” he added, saying this marked a huge change in how people think about the future.  Thiel described what he believes is the stagnation of the past 40 years and the current policy focus on financial tinkering which does not give us a chance to escape from this stagnation. “We do not need to make this Hobson’s choice between austerity and inflation. We can start to innovate, to do what technology does which is doing more with less.”

“Preposterous!” was how Shuttleworth described the three main tenets of the motion. As a species we have always been risk averse, he argued, and the idea that such risk aversion has not only slowed technological progress but also created financial crisis is flawed he said. “Governments have always been risk averse and innovations such as the space programme were built out of fear.” According to Shuttleworth, it is individuals who are innovators, not companies. To drive technological change you have to be a little crazy or a bit of a geek, and not take the majority position.  “Today is an extraordinary time to be a researcher, a scientist, an academic and an entrepreneur and the possibility for collaboration and investment has never been more easily accessible,” he said. “There are inventions being made today that will define the next decade in the same way that the internet and space flight defined what came from the 50s and 60s.”

Kenneth Rogoff dismissed out of hand the idea that technological slowdown is due to the financial crisis. “Big Silicon Valley companies can invest in what they want,” he said while admitting that it is hard for the small entrepreneurial ideas to get money and in that sense our economy is risk averse. However he argued the need to distinguish between the basic science and how it unfolds. The significance of our increased connectivity should not be underestimated. Scientists working in areas such neuroscience, AI or nanotechnology are thrilled about what they are doing in developing new materials and ideas. Rogoff questioned the importance of the speed of innovation or the increase in individual wealth for his children and grand children. “I care more about the environment that they live in and the political and military stability of their lives,” he said. Government policy, the breakdown of monopolies, patent regulations and tax policies all have a role to play in fostering innovation said Rogoff, but critically “It is important to have a spirit of the future and to look forward.”

So, what do you think? Is the current growth crisis a result of technological stagnation in a risk-averse society? Your comments are welcome below.