What If Technology Does Destroy Jobs?

June 8, 2016 in Uncategorized | Tags: , , , , , | Leave a comment

What If Technology Does Destroy Jobs?

By Shlomo Maital

Summers

Larry Summers

   Larry Summers was Treasury Secretary under President Bill Clinton, President of Harvard, and is one of the world’s top macroeconomists. In a recent New York Times article on how technology is disrupting the world, the author recalls how Summers spoke in November at a conference, about his undergraduate days at MIT in the 1970s. Nobel Laureate Robert Solow made the case then that new technology boosts productivity and overall creates jobs, employment and wealth. Sociologists at the time responded that new technology often destroys jobs and wealth.

   “It sort of occurred to me,” Summers recalled, “suppose the ‘stupid’ people (sociologists) were right, and the ‘smart’ people (economists) were wrong. What would it look like?   Well – pretty much how the world looks today.

     Uber is eliminating taxi-driver jobs. Internet news is destroying print journalism jobs. Digital education will soon eliminate my job (as professor).   Long ago, software made the entire mid-level managers’ jobs (focused on processing and interpreting data) redundant. Add to that globalization and world trade, which led America to outsource its manufacturing to Asia.  

       What if technology really does eliminate jobs? What if, like Finland and Switzerland, we will need to consider providing a basic minimum living wage for everyone, when unemployment becomes widespread? (The referendum in Switzerland on this idea was soundly defeated…but nonetheless, the mere fact it happened is important).   What if in future, work itself will be a huge privilege and a luxury, granted only to a very few highly skilled, highly productive people who somehow are not made redundant by very smart machines?  

       The late MIT Dean and Professor Lester Thurow, who passed away recently, liked to say that sociology trumps economics. If sociology is about how people live and work together, and economics is about how money and capital procreate and proliferate,   then surely he was right. Perhaps it is time that economic policy should be shaped by the sociologists.

Beyond Moore’s Law: Vacuum Tubes?

June 7, 2016 in Global Crisis Blog, Innovation Blog | Tags: , , , , , | Leave a comment

Beyond Moore’s Law: Vacuum Tubes?

By Shlomo Maital

  vacuum tube

Vacuum tube

   Sometimes, you can innovate by going back to the future. Take, for instance, the transistor. They are getting ever smaller, and more and more of them are packed into a microprocessor.   Semiconductor companies like Intel now work in 10 to 20 nanometer dimensions (a DNA strand is about 2.5 nanometers).   Below 10 nanometers, who knows how silicon will behave?  At those dimensions, it starts to emit light and becomes very flexible.

   Almost half a century ago, Intel founder Gordon Moore stated his famous law, that the number of transistors that could be etched into silicon wafers would double every 18 months or so. This has held true, remarkably. But it seems we are approaching the limit of Moore’s Law. The smaller transistors get, the more they leak electrons. This causes wasted power (up to half the power consumed by microprocessors is lost when electrons leak), and generates a lot of heat, which in turn requires massive cooling.

     Dr. Axel Scherer, a Caltech scientist, is working on a solution. He and two students have gone back to the vacuum tube. Vacuum tubes (“valves” in Britain) are devices that control electric currents between electrodes in an evacuated container;   electrons are emitted from a hot filament or a cathode heated by the filament. They are big, clunky and creating the vacuum is costly. But Scherer creates tiny tubes of metal, able to turn flows of electrons on and off between four very tiny probes. What is neat about this is that you do not need to use silicon, and the very ‘leakage’ of electrons that bedevils tiny transistors actually is the basis of the nano-vacuum tube substitute for transistors.    It reminds me of Dov Frohman’s invention of flash memory.  He was asked to solve a problem of stray electrons on the surface of silicon microprocessors, solved it, but realized you could make use of those electrons, as a way to store information.  Flash memory is now ubiquitous. 

   Could these tiny vacuum tubes help us keep Moore’s Law in business? Stay tuned. Meanwhile, think about other old technologies that can be adapted to create massive value in new ways.

   Source:   “Shrinking computer chips, thanks to grandma’s radio tubes”. NYT, John Markoff, Monday June 6, 2016

Tzameret Fuerst: Pass It Forward!

June 4, 2016 in Global Crisis Blog, Innovation Blog | Tags: , , , , , | Leave a comment

Tzameret Fuerst: Pass It Forward!

By Shlomo Maital

Tzameret Fuerst    PrePex

            Tzameret Fuerst                               PrePex

   Tzameret Fuerst is a highly-popular Israeli inspirational speaker, who travels the world telling her story.   Here it is, in short.

     She read about how HIV/AIDS is killing millions in Africa. In Botswana, one in every four persons has HIV.   Unlike the rest of us, she decided to act. She read about WHO research showing that circumcision greatly reduces exposure to HIV, by 70%, because removing the foreskin takes away the HIV virus’ favorite place to hide and invade (foreskin cells are sensitive, prone to abrasions and cuts, easy for the virus to invade). But so what? There is no way we can circumcise millions of African men.

     Well – why not?   Fast forward. Fuerst started Circ MedTech and tackled the problem with passion, and her company developed PrePex. PrePex is a device placed on the penis, that cuts off blood circulation to the foreskin; within a week it drops off. Simple. It has four parts: A placement ring; an elastic ring; an inner ring, and a verification thread. A nurse can install it; no need for surgery or a doctor. It has FDA approval and today, the Gates Foundation, WHO and the World Bank plan to get the device to 20 million men, saving 3.4 million lives and some $16.5 billion.  

     A crucial milestone came when Fuerst, stalled in her efforts to disseminate PrePex, got on a plane and flew to a conference she knew was attended by Bill Gates. She approached him, said “ May I have a few moments of your time, outside?”. Gates agreed. She persuaded him to cut the red tape and help move PrePex forward.

     There is a very personal angle. Fuerst divorced her husband, who was Chair of her company. She felt that as CEO she could not continue, as a result. So she resigned, for the good of the company and its device. She now travels the world, gave a TED talk, and tells her story to inspire others.

     How many of us can say that our energy, persistence, empathy and creativity have saved millions of lives?   Thanks, Tzameret. Your name, in Hebrew, means “summit” or “top”. And you are.

     

If Only Humans Were More Like Trees

June 4, 2016 in Global Crisis Blog, Innovation Blog | Tags: , , , , , | Leave a comment

If Only Humans Were Like Trees!

By Shlomo Maital

Chamovitz

Prof. Dan Chamowitz

    “A person is like a tree in the field,

       Like us, trees grow,

         Like trees, we are sometimes cut down,

         And I don’t know where I’ve been or where I’m going,

       Like a tree in the field.”

 

   This poem, by Israeli poet Natan Zach, and sung by Shalom Hanoch, raises a question. Are people truly like trees? Because today we know that trees communicate and work to help each other thrive.   Do we humans?

     Dan Chamowitz, Dean of Life Sciences at Tel Aviv University, wrote a wonderful book, What a Plant Knows: A Field Guide to the Senses. (2012).   “Plants can communicate like people,” he notes. “What does that say about us human beings?”

       What it says is: We should be more like trees.

       A BBC report on this research notes that trees have an Internet, comprised of fungi – thin threads that link the roots of plants deep underground, known as mycelia. This fungal network “helps out the neighbors by sharing nutrients and information, or sabotaging unwelcome plants by spreading toxic chemicals”. It’s the “wood wide web”, says the BBC. “Around 90% of land plants are in mutually-beneficient relationships with fungi.” Why? Plants provide fungi with carbohydrates. Fungi, in turn, help plants suck up water and provide “nutrients like phosphorus and nitrogen….fungal networks also boost their host plants’ immune systems by triggering release of defense-related chemicals”.   Plants do business with one another. Douglas fir and paper birch trees transfer carbon between them, through the mycelia.

     Darwin through trees are like individuals, competing for surval. But they are not. “They are interacting with each other, trying to help each other to survive,” notes Prof. Suzanne Simard, UBC Canada.

     This raises two key questions. First, capitalism. Is capitalism built on greed, on individual ‘survival of the fittest’? Because if it is, it is a gross distortion of how ‘survival of the fittest’ works in Nature.  “Let’s work together for mutual benefit,” say the trees. Perhaps that is true capitalism.

     Second: Ecosystems. Plants and trees have evolved complex highly-sophisticated ecosystems, based on mutual synergies and collaboration. We humans seem to be busy, first, destroying the fragile ecosystems of Nature, and second, destroying our own fragile social ecosystems, neighborhoods, communities and families, that build social capital.

     Humans are less and less like trees of the field. And it’s a shame.

 

 

No Money & Late Start: Go for It!

June 3, 2016 in Global Crisis Blog | Tags: , , , , , | Leave a comment

No Money & Late Start: Go for It!

By Shlomo Maital

Saatva Ron Rudzin

 

The International New York Times’ Dealbook section today (June 3) tells about Ron Rudzin, who worked in the furniture business from the age of 16, becoming VP of national sales for a sofa company. When he left Jennifer Furniture, he decided to start his own business. His vision: Sell American-made high-quality coil-based mattresses online, for a fraction of the cost of the price retailers charged for store-based brands.

     Saatva means “truth” in Sanskrit. It became profitable after its first three months,   in 2010.   Sales were $2 m. in 2011, and $76 million in 2015.   In 2018 Rudzin projects sales of $275 million.

     What do we learn? First,   becoming an entrepreneur can be done as a second career, after a long first career.   That way, you start a business with substantial domain knowledge and contacts, which very young entrepreneurs often lack.

       Second – bootstrap. Rudzin took $350,000 of his own money, wrote a business plan in 2007 and began to form his online mattress company.

   “People who raise money, rather than be self-funded, tend to spend wildly because it’s other people’s money and they throw a bunch of stuff on the wall and see what sticks. I don’t do it that way,” Rudzin said. “I might go a little slower but in the end I believe I win.”  It took him from 2007 and a business plan to 2010 to launch.  Slow and steady wins the race.

     Bootstrap, and start late. It’s possible, because chances are, when you retire, you can scrape together a not-insignificant sum of savings. Start late, because when you do, you will know a lot more about the industry in which you want to be an entrepreneur. You can spend 20-30 years just identifying a need and an opportunity and validating it.

     Rudzin’s company provides full service – experts install the mattress, a service that buyers love. He knew this was key, because of his industry experience. Not everyone would have that insight.

   Boostrapping enables you to retain control of your destiny.   When you use VC funding, after initial, A and B rounds, the founder often has his shares so diluted that the VC controls the Board – and can fire the founder and boot him out. This has happened a lot. It even happened to Steve Jobs.

   People in the future are going to live a lot longer. So we seniors should consider entrepreneurship as a possibility for a 2nd or 3rd career. Gray-haired entrepreneurs can change the world, even if they use canes and hearing aids.      

Alzheimer’s Breakthrough?

May 30, 2016 in Global Crisis Blog, Innovation Blog | Tags: , , , | Leave a comment

Alzheimer’s Breakthrough?

By Shlomo Maital

Alzheimer plaque

   Alzheimer’s Disease causes some 70 per cent of all dementia. In terms of the numbers who suffer from it, the WHO (World Health Organization) estimates that in absolute numbers 26.6 million, with a huge range of 11.4–59.4 million,   were afflicted by AD, in the world,   and, most significant,   the prevalence rate would triple and the absolute number would quadruple by 2050.  So it would not be an exaggeration to call Alzheimer’s an epidemic.

     According to Lisa Desjardins, PBS News Hour: More than five million Americans live with the degenerative brain disease that robs people of their memory. It is the sixth leading cause of death in the U.S     Yet Alzheimer’s research is seriously underfunded. America’s National Cancer Institutes alone get some $5 billion a year. On pure economic grounds, a small fraction of that sum could be better invested in the causes of dementia. Few people today have been untouched by it.

     New research led by Harvard scientists brings hope that the cause of Alzheimer’s, still unknown, will soon be unraveled:

     “….a study led by Harvard University researchers and published this week in the journal “Science Translational Medicine” suggests that Alzheimer’s could stem from the brain’s past attempts to fight off infections.”

   According to Rob Moir, a researcher at Massachusetts General Hospital:   “Alzheimer’s disease and the neurodegeneration you see with it is thought to be caused by a little protein that forms this concrete like substance in your brain called amyloid. Amyloid, it turns out, is actually be an antimicrobial pit pod, that is to say it is a natural antibiotic that defends against infection in the brain, and if you get a virus or a bacteria that gets into the brain, it rises to do better with it and binds to it and then entraps it in these long fibers and eventually entombs it forever. And as they mount in number, eventually they start to be toxic to our own cells, and that leads to the neurodegeneration. So, that’s what I bet it does.”

     In short – Alzheimer’s is caused by amyloid plaque. Amyloid plaque in turn appears to be a result of the brain’s efforts to fight infection.  

     So what?   Notes Moir: “So if it does turn out to be an infection, there is a possibility of treating people before they get AD with vaccines, to target those particular bugs so that the pathogens don’t get a chance to infect the brain.”

     Let’s follow this research closely.   One day those 50 and over may get a vaccine, like those given to children, that protect their brains. As a senior citizen, few things scare me – but the idea that my brain may one day become scrambled is a major fear. The new Harvard research offers us hope.      

Stories: Powerful Tools for Creative Thinking

May 23, 2016 in Global Crisis Blog, Innovation Blog | Tags: , , , , | 1 comment

Stories and Feelings: Powerful Tools for Creative Thinking

By Shlomo Maital

Feelings in History

 My last blog was posted nearly two months ago, on March 30. Shortly after, I left for China, for teaching and lecturing. WordPress was not accessible in China. Then, on returning home, I somehow found it hard to restart the blog machine. I deeply regret this, because knowing I have blog readers keeps my eyes and ears open for ideas….   So, this is a ‘restart’, hopefully with no more long regrettable silences…

       Nobel Laureate in Economics Robert Shiller (Yale) wrote a wonderful piece in the New York Times, Jan 22, 2016, “How stories drive the stock market”. Shiller is the author of a fine book, Finance and the Good Society, about how finance could be (but alas, sometimes is not) part of the solution, not part of the problem.

      In his NYT piece, Shiller refers to psychologist Jerome Bruner, who showed how popular narratives (human interest stories) are “fundamental drivers of motivation”.

Shiller discusses the sharp decline in the U.S. stock market since early January, and describes the ‘stories’ that explain it. First, the slowdown in the Chinese economy – “gross exaggeration” of its importance for the U.S. Second story: “record for poor performance of the stock market in the first week of the year”… Third story: low oil prices.   Fourth: tripling of the US stock market from 2009-14, and its “unwinding this year”. Many missed the big tripling, owing to pessimism and fear after the 2008 crash.   This created heightened sensibility about a possible fall, after such a surprising precipitous rise.

     Shiller cites a fine book by fellow Yale professor Ransay MacMullen,   Feelings in History: Ancient and Modern, (2003), in which he writes, “History is feeling. It is feelings that make us do what we do. And feelings can in fact be read. But the reading of them requires writers and readers to join their minds in ways that have long been out of fashion among students of history”.

     History, financial markets, consumer spending, virtually everything in our economy is driven by feelings. And feelings are evoked by stories about people, challenges, conflicts, crises and how they deal with them.

       Conclusion?   When you invest, try to analyze the prevailing ‘narrative’ or story that is driving human behavior, including the emotions underlying it. Is it valid? Is it evidence-based? Or is it superstition and empty guesswork?   If the narrative is groundless, sooner or later (it might well be much later!), the story will change and reverse.  Consider a contrarian (buy when everyone is selling) strategy.

       What is the TRUE story? The real narrative?   How do you know? What stories are people telling themselves?  

         In your startup business – what is YOUR underlying story, the story about how you create value for your clients?   Is it powerful? What emotion does it evoke?

       Feelings drive behavior. If you’re investing, a buyer, analyze which feelings are at work, and why, by identifying the dominant stories. If you’re an entrepreneur, a seller, shape your stories, by identifying clearly the motion you want to create with your innovation, then build everything you do around it, with a powerful narrative.

        

An Innovation ‘Formula’: X + Y

March 30, 2016 in Global Crisis Blog, Innovation Blog | Tags: , , , , | 1 comment

An Innovation ‘Formula’: X + Y

By Shlomo Maital  

pencil and eraser

    Some 158 years ago, on March 30, 1858,  Hymen Lipman was granted a patent for his invention of a pencil with a built-in eraser (U.S. Patent # 19,783).  Lipman was a stationery entrepreneur.  He invented many practical devices that made office work easier and faster —  for instance, putting glue on the flap of an envelope. 

    Patents require things that are “novel” and “non-obvious”.  Erasers existed. Pencils existed (since 1565, when a Swiss scientist filled a wood cylinder with graphite, found to be better for marking than lead.  (Apparently, until the 1770s, pencil marks were erased using balled-up bread!).  Isn’t it obvious that pencils need erasers on them?  Yes – but only after someone thinks of it and does it.

     Lipman understood that innovation requires two things: novelty and usefulness.  Putting an eraser on a pencil was highly useful.  Lipman sold his patent in 1862 for the enormous sum of $100,000 ($2 million in today’s money) to Joseph Reckendorfer, in 1862.   Soon, the patent was infringed by A.W. Faber, the pencil company, and Rekendorfer sued.  The U.S. Supreme Court said,  no infringement!   The eraser pencil was nothing new. All Lipman had done is combine an eraser (X) with a pencil (Y),  two known technologies.

    The court got it totally wrong.   A great many inventions involve combining in unique ways, existing things.  X + Y is a known, proven formula for innovation. Take for instance one of my former students Do Hyun Kim, a Korean engineer with LG,  who in 1985 combined a VCR with a TV, in a single box, called it Viewmax – and it became a huge hit.  Was this an innovation?   Of course. 

     Take two existing things. Combine them in a unique way.  You have an innovation, if it is useful for lots of people.  X + Y is innovative, even if the Supreme Court doesn’t think so.  Putting WiFi Internet connections into appliances — innovation?  Internet of Things?  of course. 

Source: Haaretz daily, March 30, p. 4.

How to Tie a Ponytail with One Hand

March 20, 2016 in Global Crisis Blog, Innovation Blog | Tags: , | Leave a comment

How to Tie a Ponytail with One Hand

By Shlomo Maital

one handed kuku

In Hebrew slang, “kuku” means “ponytail” – a hairdo where a girl’s hair is gathered and tied with an elastic knotting device, often just an elastic band.

   Tamar, a 15-year-old, had a problem. She had a bike riding accident and was unable to use her right hand as a result, while doing physiotherapy. Alin Hospital in Jerusalem, which specializes in children’s injuries, recently held a “Mike-a-thon Open Source” event, to gather ideas to help children in the rehab program in the hospital.   Tamar asked for a solution to her problem: Create a device so that I can tie my ponytail using only one hand, rather than two (normally one hand gathers the hair, the other hand slips the elastic over it).

   An Israel Aerospace Industries engineer, specialist in composite materials (used for aircraft wings), named Ilan Sherman came up with a solution for Tamar: an elastic with a small one-way mechanism that can only tighten, but not loosen, so that Tamar can create her ponytail with only one hand.

   Soon Tamar will have the use of both hands. But perhaps there are other young ladies who want to one-handed ponytails? Thanks Ilan!   Sometimes we need small ideas, not just huge world-changing ones….

Four Reasons Why Scientists Can’t Communicate

March 18, 2016 in Global Crisis Blog, Innovation Blog | Tags: , , | 1 comment

Four Reasons Why Scientists Can’t Communicate

By Shlomo Maital

 scientist

     As a professor, I’ve become keenly aware how poor we profs are at communicating our ideas to others, in understandable clear and actionable ways.   I think we economists find meaning in life by confusing the most people we can. Now an expert comes along and explains why. Tim Ward’s blog was published in Society for Conservation Biology News and a relative in NYC passed it on to me.

“Four Mistakes Scientists Make When They Communicate:

  1. Certainty. Scientists are trained skeptics, so they back away from certainty. But outside the realm of science, people interpret expressions of certainty as more likely to be true than expressions of cautious probability. It’s a losing tactic to insist on speaking of certainty only in the scientific sense. Instead, think about how you can speak with certainty in the commonly understood sense. For example, you can say with certainty: “According to NASA, 97% of climate scientists agree the climate is warming. I’m certain the risk is great and we need to act now.”
  2. If you don’t have a seat at the table, you won’t have a voice at the table. We learned this principle from Dr. Alan Thornhill, who now works for the US Department of the Interior. He told us that at many meetings where policy decisions were being made, he was the only scientist in the meeting. There were many times others turned to him with scientific questions, only because he happened to be in the room. During other discussions he would interject with, “Hold on a minute, we have to look at the scientific research on that before we decide.”
  3. Assuming the facts will speak for themselves: they don’t. You must advocate for the facts.   Communicating for influence is a matter of survival of the fittest. It’s not enough to deliver your information. You are competing with other voices. Use memorable quotes and messages to make your facts stick.
  4. Focusing on evidence, not on relevance.   Scientists too readily dive into the details of their research when speaking in public. But in the real world, if people don’t know why the topic is important to them, they won’t pay attention, and they won’t be listening when you get around to relevance at the end of your talk.  In sum, communication is not about output, it’s about impact.”

Blog entries written by Prof. Shlomo Maital

Shlomo Maital

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