The Rational Optimist

Rating 7.0/10

My Summary:

Ridley tries to argue that due to the way humans think, grow, and prosper, humanity will thrive indefinitely. Mostly, our ideas grow in an evolutionary way, so harsh conditions will simply cause a different evolution. The author takes a look at history, and uses examples of humans thriving, surviving, and inventing to argue that we will continue to thrive, survive, and invent. The book proposes an interesting theory, though I am not completely sold. Who is to say that all future events will resemble past events? What if a Black Swan event (thanks, Nassim Taleb) occurs? It is quite possible that we, as humanity, may need to develop drastically new strategies to deal with the problems of tomorrow. Though, a fun read as he writes well.

Quotes:

The answer, I believe, is that at some point in human history, ideas began to meet and mate, to have sex with each other.

Governments prevent [housing market crashes] by, first, using planning or zoning laws to restrict supply (especially in Britain); second, using the tax system to encourage mortgage borrowing (in the United States at least – no longer in Britain); and third, doing all they can to stop property prices falling after a bubble. The effect of these measures is to make life harder for those who do not yet have a house and massively reward those who do. To remedy this, governments then have to enforce the building of more affordable housing, or subsidise mortgage lending to the poor.

Charles Ponzi, where did you think the term ‘Ponzi scheme’ came from? read about this guy

The cumulative accretion of knowledge by specialists that allows us each to consume more and more different things by each producing fewer and fewer is, I submit, the central story of humanity.

Fire and cooking in turn then released the brain to grow bigger still by making food more digestible with an even smaller gut – once cooked, starch gelatinises and protein denatures, releasing far more calories for less input of energy. As a result, whereas other primates have guts weighing four times their brains, the human brain weighs more than the human intestine. Cooking enabled hominids to trade gut size for brain size.

Exchange is to technology as sex is to evolution.

Collaboration between unrelated strangers seems to be a uniquely human achievement.

A monopoly rewards caution and discourages experiment, the income is gradually captured by the interests of the producers at the expense of the interests of the consumers, and so on. The list of innovations achieved by the pharaohs is as thin as the list of innovations achieved by British Rail or the US Postal Service.

China, meanwhile, was heading the other way, into stagnation and poverty. China went from a state of economic and technological exuberance in around AD 1000 to one of dense population, agrarian backwardness and desperate poverty in 1950. According to Angus Maddison’s estimates, it was the only region in the world with a lower GDP per capita in 1950 than in 1000. The blame for this lies squarely with China’s governments.

As Edward Glaeser put it, ‘Thoreau was wrong. Living in the country is not the right way to care for the Earth. The best thing that we can do for the planet is build more skyscrapers.’

Throughout the world, birth rates are falling. There is no country in the world that has a higher birth rate than it had in 1960, and in the less developed world as a whole the birth rate has approximately halved.

But now that even the United Nations’ best estimate is that world population will probably start falling once it peaks at 9.2 billion in 2075, there is every prospect of feeding the world for ever. After all, there are already 6.8 billion on the earth and they are still feeding better and better every decade. Only 2.4 billion to go.

Cotton tells the tale best, though. In the 1600s, English people wore wool, linen and – if they were rich – silk. Cotton was almost unknown, though some refugees from Spanish persecution in Antwerp settled in Norwich as cotton weavers. But trade with India was bringing more and more ‘calico’ cotton cloth into the country, where its light, soft, washable character, and the way it could be colourfully printed and dyed, attracted demand from the well off. The weavers of wool and silk resented this upstart rival, and pressed Parliament for protection against it. In 1699, all judges and students were told to wear gowns of wool; in 1700 all corpses were ordered to wear shrouds of sheep’s wool; and from 1701 it was decreed that ‘all calicoes painted, dyed, printed or stained … shall not be worn’. So ladies of fashion bought plain muslin and had it dyed. Riots broke out and women seen wearing cotton were even attacked by gangs of silk or wool weavers. Cotton was considered unpatriotic. By 1722 Parliament had bowed to the wishes of these weavers and on Christmas day that year, when the Calico Act took effect, it became illegal to wear cotton of any kind, or even to use it in home furnishings. Not for the last time, the narrow interest of producers triumphed over the broader interest of consumers in an act of trade protectionism.

Thomas Edison deserves the last word: ‘I am ashamed at the number of things around my house and shops that are done by animals – human beings, I mean – and ought to be done by a motor without any sense of fatigue or pain. Hereafter a motor must do all the chores.’

Very roughly, the best industry to be in as an innovator was: 1800 – textiles; 1830 – railways; 1860 – chemicals; 1890 – electricity; 1920 – cars; 1950 – aeroplanes; 1980 – computers; 2010 – the web.

This nicely captures the paradox of the modern world, that people embrace technological change and hate it at the same time. ‘People don’t like change,’ Michael Crichton once told me, ‘and the notion that technology is exciting is true for only a handful of people. The rest are depressed or annoyed by the changes.’ Pity the inventor’s lot then. He is the source of society’s enrichment and yet nobody likes what he does. ‘When a new invention is first propounded,’ said William Petty in 1679, ‘in the beginning every man objects and the poor inventor runs the gauntloop of all petulant wits.’

California is not the birthplace of entrepreneurs; it is the place they go to do their enterprising; fully one-third of successful start-ups in California between 1980 and 2000 had Indian- or Chinese-born founders.

The wonderful thing about knowledge is that it is genuinely limitless. There is not even a theoretical possibility of exhausting the supply of ideas, discoveries and inventions. This is the biggest cause of all for my optimism.

Some 19 per cent of Americans believe themselves to be in the top 1 per cent of income earners.

‘Its tough to make predictions,’ joked somebody, perhaps Yogi Berra: ‘especially about the future.’