NOTE: The following section is the beginning of Part One of my book World After Capital. I have been posting revisions here most Mondays.

Part One: Laying a Foundation

In an earlier version of this book I attempted to skip any philosophical exposition and jump right into the impact of digital technology. While that may make for more gripping reading, it resulted in the verbal equivalent of building a skyscraper without a foundation: rapid initial progress followed by total collapse.

With digital technology inflating the space of the possible, we need to establish some principles. Otherwise we will misread the trends and phenomena that are already happening today. Instead of exploring the new space of the possible for the benefit of all of humanity, we will instead try to bend it to fit existing economic and social systems.

What follows is my attempt to establish a firm foundation for building a future grounded in optimism and humanism. I explain why the power of knowledge is the source of optimism as a principle, and why the existence of knowledge provides an objective basis for humanism. Much of my thinking about this has been deeply influenced by the writing of David Deutsch, in particular his book “The Beginning of Infinity” [17].

Furthermore, to argue that capital is no longer scarce and that attention now is, I provide a definition and an analysis of scarcity that are not based on money and prices, but rather on needs. Finally, to support this argument, I propose a catalog of our individual and collective basic needs as humans.

With these foundations in place, we can then fully appreciate how the power of digital technology enables the Knowledge Age.

Optimism

When I started my blog a decade ago, I called myself a “Technology Optimist” in my first post. I wrote that

I am excited to be living in a time when we are making tremendous progress on understanding aging, fighting cancer, developing clean technologies, and so much more. This is not to say that I automatically assume that technology by itself will solve all our problems (I guess that would be a “technology pollyanna”). Instead I believe that—over time—we as a society figure out how to use technology to actually improve our standard of living. I for one am sure glad I am not living in the Middle Ages.

The fundamental tenor of this book is one of optimism. This is in part a reflection of my personality. I am pretty sure it would be impossible to be a VC as a pessimist. You would focus only on the many reasons why a particular startup won’t succeed and never make an investment.

Optimism is a theme that I will return to many times in this book and so it is a good idea to make this apparent bias of mine clear upfront. It is more than a personal bias though. Optimism has a profound role in human affairs and its source is the power of knowledge. Knowledge has given us vaccines and cures to many diseases. Knowledge lets us travel long distances at high speeds in trains and planes. Knowledge lets us read Aristotle and listen to Mozart. Knowledge is what makes us humans human (in a way I will make more precise shortly).

I am optimistic about what humanity can ultimately accomplish with digital technology. Using the Internet and advances in machine intelligence we can dramatically accelerate the creation and distribution of knowledge. This will be essential for progress.

Progress has become a loaded word. Is there such a thing as true progress and what does it look like? Aren’t we humans responsible not only for the many diseases of civilization but also for the downright extinction of countless species and potentially our own demise through climate change?

Yes, we do have problems. And one might, as a pessimist, focus on these problems and conclude they cannot be solved. This is like looking at a startup and concluding there is no point in even getting going—or funding it—because, well, there will be problems.

The beauty of problems, though, is that they can be overcome by human knowledge. Is that true for all problems? Well it has been true so far, as we are still here.

This is in and of itself quite remarkable: we are slower and weaker than many other species, but humans alone have developed the capacity for knowledge. And knowledge turns out to be extraordinarily powerful. It allowed us to figure out, for instance, how to make fire. We may take this for granted today, but no other species has managed to do this and to record its knowledge of fire making in a way that can be shared across space and time (I will shortly provide a more precise definition of knowledge and why it is quite so powerful).

There is an extreme position that would suggest we would have been better off never developing knowledge [18]. That we would still live in a state of paradise had we not tasted the forbidden fruit. Not only is it hard to see how we would go back there now, but more importantly, I for one prefer not to be consumed by wild animals.

Will all future problems be solvable, including say climate change? There is, of course, no guarantee. We might wind up with a problem we cannot solve and that might cause our extinction. But what is certain is that assuming that problems cannot be solved guarantees that they will not be solved. Pessimism is a self-defeating attitude, as it leads to inaction.

Yes, digital technologies including the Internet and advances in automation have brought with them a new set of problems. We will encounter many in this book, including immense pressure on people’s ability to earn a living and the conflicts arising from being exposed to content that runs counter to one’s upbringing or deeply held cultural or religious beliefs.

And yet this expanded space of the possible also includes amazing progress, such as zero marginal cost diagnosis of disease for anyone anywhere in the world, the example we encountered at the end of the previous chapter.

Believing in the potential for real progress though is not the same as being a Pollyanna. Progress does not happen by itself as a deterministic function of technology. Contrary to Kevin Kelly’s claims in his book “What Technology Wants”, technology doesn’t want anything by itself and certainly not a better world for humanity. It simply makes such a world possible.

Economics also doesn’t want anything. It is not normative. Nothing in economics, for instance, says that a new technology cannot make some people or possibly a great many people worse off. Economics gives us tools for analyzing markets and designing regulations to address some of their failures. But we still need to make choices about what we want markets and regulations to accomplish for humanity.

And contrary to Karl Marx, history too doesn’t want anything. Nor is there, as political economist Francis Fukuyama would have it, an end of history with a final social, economic and political system. History is the result of human choices; it doesn’t make its own choices. And as long as we make technological progress there will be new choices to make.

It is our responsibility, both individually and collectively, to make choices about which of the many worlds made possible by digital technology we want to live in. We need to choose rules for society (regulation) and behaviors for ourselves (self-regulation). And the choices we make now are especially important because the latest expansion of the space of the possible includes machines that have knowledge and can make choices.