Reason Magazine - Contributors

Secrets of Success

info@reason.com (Joel Mokyr) — Tue, 01 Dec 1998 00:00:00 EST

Conquests and Cultures: An International History, by Thomas Sowell, New York: Basic Books, 493 pages, $35.00

Guns, Germs, and Steel: The Fates of Human Societies, by Jared Diamond, New York: Norton, 480 pages, $27.50

Global economic history is "in" again. Along with the two books reviewed here, I could mention David Landes's The Wealth and Poverty of Nations, Richard Easterlin's Growth Triumphant, Robert McC. Adams's Paths of Fire, and Patrick Verley's L'échelle du Monde. More are on the way. All of these books are trying, in one way or another, to answer the question posed by Thomas Sowell: Why does 17 percent of the world produce four-fifths of its output? A more elegant way of raising the same issue is what Jared Diamond calls "Yali's question." Yali is a New Guinea notable who one day asks Diamond why white people have so much "cargo"--Western manufactured goods desired by New Guineans --while New Guinea produces no cargo of interest to Westerners.

Everyone understands that these questions can never be answered in a definitive way, comparable to proving Fermat's Last Theorem. The distribution of prosperity is hopelessly "overdetermined": There are far too many answers that all seem to be right. Culture, geography, institutions, war, religion, and even historical accidents all seem to have played a role. But what role, and which factors are most important, remain matters of controversy.

Thomas Sowell's Conquests and Cultures is the third volume of a trilogy, preceded by Race and Culture and Migrations and Cultures. Sowell, a noted economist and social commentator at Stanford's Hoover Institution, raises the interesting issue of what happens when two culturally and economically different societies clash militarily and one of them "conquers" the other. Using this general framework, he analyzes four historical cases in which conquest played a major role: England, Africa, the Slavic people, and the Western Hemisphere Indians. These chapters show that conquests do not have much in common, yielding a somewhat confused picture. In Africa, conquest led to slavery for a large proportion of the population; in the Western Hemisphere, to the physical destruction of much of the indigenous population; in Eastern Europe, where conquerors and conquered changed positions over time, to an unstable and variable clash of cultures.

Conquests come in many forms, from the long-term occupations of the Romans in the Mediterranean to the short-lived mega-empires of Tamerlane. Some of them led to a forced or voluntary assimilation of the conquered to the language and customs of the victors, but in other cases the reverse occurred (for example, the Roman conquest of Greece or the Mongol conquests of China). Sowell points out that being conquered often led to a long-term increase in living standards and economic performance, and in some cases when the occupiers withdrew (as the Romans did from Britain in the fifth century) the occupied countries sank into poverty and barbarism. In Sowell's view, exploitation and theft do not go nearly as far in explaining economic differences as culturally caused differences in productivity.

The key concept in Sowell's view of history is "cultural capital," which is transferred and diffused among societies. The concept is nowhere defined with any precision, and at times it seems to be interchangeable with "human capital," though Sowell uses that term rather loosely as well, often more in the sense of mentalité and social institutions than in the sense employed by economists (an economically useful formal education). Yet his overall view of history is quite clear: People are born with very similar innate abilities, but their economic achievements differ enormously due to differences in "cultural capital," which determines not only such matters as technological sophistication but also "attitudes" such as diligence, honesty, and ambition. For Sowell, the most important form of cultural capital is freedom, which is Britain's gift to the world. Free markets and the aggressive pursuit of economic success within them are the central answers to Yali's question.

The question of why and how these ideas caught on or did not occupies the bulk of Conquests and Cultures. Some of the themes announced at the start, especially the effects of "conquest," are lost in the shuffle, and when the reader puts the book down, its basic message remains fuzzy. What is clear is that, much like David Landes, Sowell believes that Western culture and values hold the key to economic progress. His knowledge of economic history, unfortunately, cannot hold a candle to Landes's, and because of his very cursory discussion of the key elements in this story, the book will probably only preach to the converted and irritate the skeptics.

This is not to say that Conquests and Cultures has no valuable messages. Sowell points out that statements about general characteristics of a large group (ethnic, racial, religious) are not necessarily inadmissible if these groups share a culture or an environment that might affect their traits. Essentialism (the notion that groups share certain inherent traits), fervently denounced by politically correct scholars, is not the same as racism. Sowell also points to the dynamic role played in economic history by population movements and minorities, perhaps not a novel insight but worth stressing. At times immigrants and minorities enriched the local inhabitants with their culture and knowledge; in other cases they were the winners.

Sowell surely will annoy some pious liberals by noting that the lighter the skin color of American blacks, the higher their scores on tests of intelligence "and other social qualities." This, he proclaims, is not a subjective perception or a stereotype but a fact. The explanation is that the lighter-skinned group had "earlier and better access to higher levels of European culture." Without, of course, endorsing oppression and slavery, Sowell argues that the more Africans (in either hemisphere) had contact with European culture, the better off they were economically.

Even more courageously, Sowell admonishes us to examine seriously racist theories that correlate genetics with achievement. While these theories are incorrect, he says, something useful can be learned from the conversation with racists, and blanket dismissals are uncalled for. For instance, biological differences between races may exist even if they are not caused by genes: Norwegians are taller than the Japanese (and Americans are fatter than anyone else), but this is primarily due to environmental and nutritional differences, not genetics.

As a work of scholarship, unfortunately, Sowell's book is broad rather than deep. Although the book contains an amazingly large number of notes (1,626, to be exact), they point mostly to textbooks, atlases, works of reference, and well-known (usually dated) syntheses. Of course, nobody can be an expert on the huge literature of any of the four cases that Sowell analyzes, let alone all four. All the same, the net result is that many of his chapters read like potted histories, distilled from the secondary literature.

At least for the small subset of Sowell's material on which I can claim some expertise, the research behind this book does not inspire confidence. The small section on the British Industrial Revolution seems to have evaded every important book written on the subject in the past two decades. Sowell's pitiful survey of Ireland, seemingly a superb case through which his theories about the effects of conquest on the diffusion of cultural capital could be tested, contains the howler that the dire poverty of the Irish in the early 19th century is indicated by a life expectancy of 19 years.

The actual number is probably twice as high (see Cormac Ó Gráda's Ireland Before and After the Famine, 1993, page 18). And unbeknownst to Sowell, modern research has discovered that the Irish were taller than their English contemporaries, indicating that measures of "poverty" and "backwardness" are ambiguous. In a brief section supposed to explain how "religion played important roles in the secular development of the world," Sowell somehow fails to mention either Max Weber or Lynn White. My point is not to nitpick on one or two errors so much as to point out that in books such as this one no reader knows the "topic" as a whole; if a reviewer finds glaring errors and poor coverage in an area in which he has some expertise, his confidence in the rest of the story is inevitably reduced.

Jared Diamond's book, Guns, Germs, and Steel, shares with Sowell's the premise that all nations and ethnic groups possess the potential for economic success, even if that potential is not realized to the same degree everywhere. Otherwise, the two books are quite different. Diamond is a professor of physiology at UCLA's medical school whose range marks him as one of the true Renaissance scholars of our time. He is also a highly original thinker whose scholarship in many areas is sound and reliable. This book, honored recently with a Pulitzer Prize, is mandatory reading for anyone who purports to engage big questions in the area of long-term global history.

Diamond, to put it bluntly, is a geographical determinist. The shape and location of continents, original flora and fauna, microbes, water, climate, topography--all are truly exogenous to history. The rest is endogenous. Geography, of course, has a terrible reputation in historical explanation. Landes, in his Wealth and Poverty, starts off by recounting how geography departments were closed around the country without a tear; he notes that "no other discipline has been so depreciated and disparaged." Simple-minded explanations that submit that "Britain had an Industrial Revolution because it had coal" have long been abandoned.

Yet before we dismiss Diamond's book as another simplistic tale, we have to face the fact that he knows his stuff inside out, to the point where any thought of using the adjective crude (traditionally preceding determinist) evaporates as we turn the pages. Diamond fires off a barrage of facts and observations based on half a dozen disciplines, from archeology to botany to linguistics. He argues that the world's population bifurcated for geographical reasons. Once the different paths were established, "Eurasia" diverged from Africa and America more and more through positive feedback effects, in which geography fed into technology and technology fed into power structures and culture, which fed back into technology and growth, until we got a world of Western economic hegemony.

Diamond emphasizes that human wealth and success depend on interaction with the environment. Economic history, in his view, is a game against nature, not primarily a social process. Production, especially in agriculture, depends on the geographical hand we have been dealt. Yet Diamond, unlike most geographers, focuses not on soil fertility and minerals but on the ability of humans to domesticate plants and animals. Unlike Sowell, he says all societies and cultures initially had similar abilities to manipulate nature, but their raw materials were different.

To exploit large animals for food, energy, or other uses, you need domesticable wild animals, something that did not exist in pre-Columbian America (where the arrival of Homo sapiens 13,000 years ago apparently led to their extinction). Such animals have to satisfy certain conditions: They must be able to breed in captivity, they must be safe around children, and so on. Diamond lists five major species of large, domesticable animal species--cows, goats, sheep, pigs, and horses--and nine minor ones, including reindeer, yaks, and llamas. Of these 14, only one was native to South America (llamas and their close cousins, alpacas) and none to North America.

Diamond argues persuasively that the hippos and giraffes of Africa, the jaguars of the Amazon, and the kangaroos of Australia were not domesticable. He says the domesticated llamas, alpacas, turkeys, and dogs of America could not pull it off either. North America's other large herbivorous mammals all turned out to be nondomesticable. Eurasia, on the other hand, was lucky enough to have the wild animals from which our cows, sheep, horses, and chickens could be bred. This gave the Europeans huge advantages not only in the development of technology (mixed farming and wheeled transport, for example) but also in resistance to infection, providing them with immunity against diseases caused by proximity to domestic animals. When Europeans traveled to other continents, the infectious diseases they carried overwhelmed the natives.

Eurasia was also lucky to have a much larger stock of plants that lent themselves to domestication. Eurasian plants were more nutritious, easier to cultivate, and more resistant to disease. Botanical wealth, says Diamond, determined agriculture, and agriculture determined everything else. Eurasia won because its supply of wild plants, which provided the gene pool for domesticated crops, was larger, richer, and better. If you think this explanation is simplistic, read the chapters on "How to Make an Almond" and "Apples and Indians."

Diamond realizes, of course, that the Americas contained a considerable number of highly nutritious crops, many of which were transplanted successfully to Eurasia after 1500. Yet he maintains that because of diverse climates and the narrow connection between North and South America, such crops did not proliferate as readily as in Eurasia. Doubts begin to emerge here: Corn and potatoes are hardy plants that grow in a wide variety of conditions, and Diamond never quite nails down the reason for their failure to spread earlier and more widely in pre-Columbian times.

Perhaps, as Diamond seems to believe, they would have, had there been more time. Had Columbus arrived a millennium or two later, North America might have been a very different society. Surprisingly, Diamond says little about the potential of the lowly potato, which merits only cursory mentions in his book even though it radically transformed the societies in which it was adopted. Such doubts notwithstanding, this is a serious, informed, and well-thought-out argument. If in the end we are not wholly convinced, thinking of how to refute Diamond will make us wiser.

How much of the performance of non-Europeans was constrained by their environment, and how much was their own making? In Diamond's view, the answers are "all" and "none." But this is by no means clear. For example, Diamond says one of the disadvantages encountered by the indigenous people of what is now the eastern United States was a lack of wild plants that could be turned into crops. Yet he concedes that some native species might have done nicely. He describes sumpweed, with 32 percent protein, as "a nutritionist's ultimate dream." He explains that the flower did not make it to the rank of corn, potatoes, and rye because it causes hayfever, smells bad, and can cause skin irritation. Are we sure that these vices could not have been bred out of sumpweed, just because they were not? All domesticated plants originally had undesirable characteristics, but through deliberate and lucky selection mechanisms they eventually got over them. Wheat, rye, and maize, which feed much of the world's population, all had humble beginnings.

To be fair, Diamond's argument is not entirely ex post. He points out that our ability to improve plants depended largely on whether the code for certain characteristics was carried by more than one gene. People could select for a particular trait as long as it was caused by one or very few genes; if it was controlled by many genes, breeding specimens that displayed the trait would be unlikely to fix it in the population. Diamond offers a few examples, but he does not persuade me that this problem was especially pronounced in the societies he identifies as geographically challenged.

There is a similar weakness in Diamond's view of technology. In a chapter cleverly named "Necessity's Mother," he notes the many links between geographical constraints and technical options. Why would a society produce wheels if it had no horses or oxen to pull them? Wheelbarrows and rickshaws might have been an option, but maybe draft animals came first. Not all questions can be answered this way: Some indigenous populations in America might have built seaworthy ships, or managed to develop a technology we cannot imagine today. If they did not, is this because they tried and failed, or because they never tried?

Diamond offers two reasons to believe that links between geography and technological progress may be significant. One is that geography constrains mobility of knowledge. Assume, somewhat implausibly, that the idea of a wheelbarrow occurred to just one person in history, but that it spread to people seeing their neighbors use one. If this happened in Central Asia, it may well have reached China, France, and Yemen within a few centuries, but before 1500 it would never have gotten to America or Australia. And Diamond notes that agricultural technology diffuses more easily from east to west than from north to south, since changing longitude has a stronger effect on climate and seasonality than changing latitude--giving Eurasia an advantage over America and Africa.

Diamond also resurrects the late Julian Simon's argument that technological success often depends on population density and the ability of a society to produce a surplus beyond subsistence, so that there are resources available for tinkering and experimenting. Maximum population density was largely a function of the environment's ability to feed people. Writing, for instance, required large and dense settlements with complex hierarchical institutions, much different from hunting and gathering tribes.

The notion that much of economic history is a game against nature, in which people form certain views about its regularities and use these to manipulate their environment and improve their material conditions, is a powerful one. Diamond's insight is that nature differs from place to place and that certain environments are easier to manipulate than others.

The economic historian must addtwo qualifications to this. First, environments can be manipulated or abandoned. While Diamond describes in detail prehistoric population movements (which he deduces from linguistic evidence), he does not realize that he tells the story of regions, not necessarily of people living there, who always had the option of moving to a more generous and flexible area. Second, it could be argued that much technology emerges precisely because the environment is not generous and requires hard work and ingenuity. It is here that Sowell's "cultural capital" comes in, directing us to another important set of variables. The difference between the two approaches is that in Diamond's account culture itself is determined by location: Geography truly is destiny.

How can we be sure? We cannot. When all is said and done, the overdetermined nature of the issue remains: There are many explanations for the observed gaps in income and economic success, and they all make sense; they all are consistent with the evidence. Our models of history, however, are still unable to rank them by importance or assign weights to them. Is culture really determined by geography, as Diamond thinks, or is technological success above all a rebellion against the dictates of the environment? If everything in global history is interrelated with everything else, who can blame our students for being bewildered? After all, Fermat's Last Theorem took three centuries to prove, and this problem is a lot harder.

Future Enemies

info@reason.com (Joel Mokyr) — Sat, 01 Jun 1996 00:00:00 EDT

Protectionism is a bit like bloodletting. For centuries many intelligent and learned people passionately believed bloodletting was a panacea, and they fought for it on the political and intellectual battlefields. Yet they were hopelessly wrong. Unfortunately, whereas the practice of bloodletting has joined the flat earth, alchemy, and phlogiston physics in the dustbin of the history of science, protectionism somehow manages to raise its ugly head time and again in America. While the leaders of both major political parties have by and large embraced free trade, some fringe candidates have resurrected protectionism and are riding a wave of bigotry and parochialism, masquerading as "America First." Like taxes and death, we cannot shake it, and maybe we never will. But it is worth trying.

The intellectual case for protectionism is about as alive as a doornail. To be sure, a few clever economists have constructed some pathological scenarios in which a tariff could be beneficial. For the protectionists to take solace from this literature would be akin to flat earthers finding vindication in the fact that the Earth is slightly flattened at the poles or phlebotomists gloating about a few rare diseases in which removal of blood can be beneficial. But economics, unlike physics or medicine, cannot experiment and has no laboratories. The burden of proof is always heavier, and those who refuse to believe in the obvious can find a sympathetic audience, especially since protectionism has been able to draw support from the seemingly inexhaustible reservoirs of xenophobia and prejudice that bubble beneath the surface of American society. Moreover, there are always groups that stand to gain from protection. These groups naturally ignore the intellectual bankruptcy of protectionism and dig up various crackpot theories that seemingly show how tariffs can benefit a nation.

The most persuasive case against protectionism is not the standard one that undergraduate students are taught in their introductions to international economics, which goes like this: Tariffs distort the allocation of resources and impose a "deadweight burden." The few gain at the expense of the many, but their gains are smaller than the losses. Society throws away valuable resources by artificially inducing its producers to supply goods that can more efficiently be imported.

The standard argument is certainly correct, but somehow it has failed to persuade many people since it was first enunciated by Adam Smith and David Ricardo. Presumably political speeches that urge people to "support your local efficient allocation of resources" are not exactly sound-bite material. Sometimes arguments are correct but do not work politically. In this regard, physicians have done a better job in persuading us that bloodletting is a useless medical practice than economists have in defending free trade. Part of the problem may be the rhetoric of economics. An equally important obstacle is the powerful interests who stand to gain from protectionism's distortions at everyone else's expense.

A more dynamic argument can be constructed. It, too, may be more of an intellectual exercise than a good campaign slogan, but because we can explain it without relying on "little triangles" in supply and demand diagrams, it may be more appealing. The argument is this: Protectionism and insularism impede innovation, depriving our children of the comfort and security that progress and economic growth bring. Free trade and international competition not only lead to a better allocation of resources; they ensure that countries do not lull themselves into the technological lethargy that is the archenemy of economic growth.

The omnipresent danger to continued technological advance is that innovation--not unlike free trade--has many enemies who would like nothing better than to impose legal and political restrictions on it, from licensing laws to featherbedding. Technological change is creative destruction. It almost always involves losers. These losers cannot be expected to stand idly by and watch others superannuate them.

Medieval guilds were by and large successful in codifying explicitly all stages of manufacturing, thus making new ideas almost impossible to introduce. Beginning in the 1920s, British labor unions tried the same thing. The technological status quo embodies huge investment in physical and human capital. It is hardly surprising that its owners promote slogans like, "If it ain't broke, don't fix it." Technological success breeds its own failure by using politics to protect itself from the next wave of innovation. For that reason technological success in any society is usually short-lived, a regularity that I have called "Cardwell's Law."

In an open economy, where producers constantly have to compete with foreigners working under different institutions, it is far more difficult to erect such barriers. An industry that cannot or refuses to innovate will be wiped out by imports. Since producers expect this, the incentives to stay near the cutting edge of technology are far stronger. Imports mean that consumers will still be able to get new products, unless the vested interests can persuade the government to surround the country with a wall of tariffs to protect an increasingly obsolete industry.

An example is the late-19th-century British shoe industry. The economic historian Roy Church has shown how these manufacturers were reluctant to buy the fancy shoemaking machines developed in the United States yet were eventually forced to do so because of the flow of cheap machine-made shoes from America. Britain remained loyal to free trade, and time and again the forces of technological reaction in Victorian Britain were defeated by the powerful forces of foreign competition.

In other words, protection not only compels consumers to pay more than they should for the products they buy; it deprives future consumers of the main benefit of competitive capitalism: continued product and process innovation. Free trade guarantees the unhindered flow of information and knowledge.

This point flies in the face of the "infant industry" argument, which says protection is necessary for young and inexperienced firms to reach maturity and learn to use new technology. That argument, first dreamed up by Alexander Hamilton and tirelessly reproduced by protectionists ever since, is rarely supported by any evidence, and the many assumptions on which it rests are never tested. As Jagdish Bhagwati, the dean of international trade theory, noted in his 1988 book Protection, it is usually simply assumed that because firms produce, they "learn" and eventually become more efficient. But unless there is pressure from imports, internal competition may be insufficiently intense to spur the effort to develop and learn new techniques.

Superficially, the historical experience of the United States seems at odds with the argument that protectionism hinders economic progress. After all, the United States emerged from the Civil War as protectionist as ever. In the 19th century the Republican Party was the party of protection, and free trade, traditionally favored by the South, bit the dust in 1863. Yet the years after the Civil War were a period of accelerated technological progress.

Such superficial correlations should not mislead us, however. It often happened that patients who were bled recovered, convincing both doctor and patient that the bloodletting had been beneficial. In 19th-century America, commerce between states and regions dwarfed foreign trade. Interregional competition did for the United States then what international trade does today. The U.S. Constitution is the greatest free trade document in history, assuring free trade between the states. Had the states been allowed to set up internal tariffs, protectionism might well have destroyed economic growth in America.

Furthermore, America was hardly insular: While it was protectionist as far as goods were concerned, it let people in relatively unhindered until 1922. Anyone who wanted to introduce new technology into America could immigrate here and innovate all he wanted. Samuel Slater, Andrew Carnegie, Leo Baekeland, Nicola Tesla, Vladimir Zworykin--the number of foreign-born inventors and innovators who helped build America's technological leadership is striking.

Today's neo-populists wish to shut off the flow of immigrants while simultaneously curtailing imports of goods and services. This will mean cutting off the influx of new ideas. Their logic is that if it is worth inventing, American ingenuity will create it. This goes beyond protectionism; it is insularism inspired by ethnic arrogance. For many centuries, proud empires such as China and the Ottomans assumed they had nothing to learn from barbarians, with devastating effects on their long-term economic development. By 1900 these insularist empires had fallen hopelessly behind the comparatively open economies of the West. In the 20th century, Albania and North Korea fared no better.

There is no real danger that America will become as insularist as that. But the aggressive protectionism advocated by some candidates resonates with a worrisome number of voters. Trade measures would be met by retaliation, and full-scale trade wars with Japan and the European Union, thus far mercifully avoided, might erupt. The economic damage to future generations would be enormous.

Man Vs. Machine

info@reason.com (Joel Mokyr) — Mon, 01 Jan 1996 00:00:00 EST

Rebels Against the Future: The Luddites and Their War on the Industrial Revolution, Lessons for the Computer Age , by Kirkpatrick Sale, Reading, Mass.: Addison-Wesley, 320 pages, $24.00

Western living standards and levels of physical comfort today are immeasurably higher than at any time in the past. This is hardly an earth-shaking revelation. Neither is the observation that the bulk of this achievement is due to human ingenuity and cleverness in controlling the forces of nature and using them to improve the human condition. And yet, technology has always had its detractors and enemies, who stood on the sidelines of progress, jeering and booing, and at times trying to place obstacles in the way. Ever since Prometheus discovered fire and Daedalus the art of flying, some people have felt uncomfortable and guilty about technology, and in each generation we can find some evidence of "Luddism," a hostile attitude toward the tools and ideas that are meant to make society richer.

What explains technophobia? The opponents of technological change are neither fools nor demons, their arguments neither insane nor ignorant. While on the whole their resistance is both misguided and futile, it is imperative to understand the roots and sources of their attitude. To start with, not all enemies of technological progress were created alike. The most fundamental distinc tion is between the victims and the ideologues.

Technological progress inevitably has victims. It is difficult to think of a single invention in history, no matter how beneficial to society, that did not make somebody worse off. Once a technique is replaced, those who had invested in the old way of doing things end up losing their investment. If physical equipment and human skills could painlessly and costlessly be converted from technique to technique, innovation might have only beneficiaries. In practice, obsolescence is inevitable, and thus there is pain and suffering for some even when society as a whole benefits. Technological progress in a free market society means that on the whole the benefits exceed the costs, so that society is better off, even if the improvement is not "Pareto-superior," as the econo mists like to say. Those at the losing end of the story, whose jobs may disappear, whose skills and equipment become worthless once they are replaced by machine, would be rational to do all they can to stop the competitive market process that threatens them.

There are two ways to short-circuit technological progress: get some form of legislation or regulation to ban the new process, or go against the law and resort to violence in the form of sabotage and terrorism. The latter option, what we usually refer to as "Luddism," is the main topic of Kirkpatrick Sale's book. The Luddites were groups of workers displaced by machinery during the early stages of the British Industrial Revolution who resorted to machine breaking and other acts of violence in an attempt to stop the technological advances that threatened their livelihood. Whereas the textile mills in Britain increased the overall economic welfare of the average Briton by reducing the price and improving the quality of textiles, the stocking-frame knitters in Nottinghamshire and woolen-cloth croppers in Yorkshire were clearly worse off.

The ideological sources of resistance to new technology are more diverse. Philosophers, social thinkers, and political activists who themselves have little to lose from new technology object to some or all of the changes brought about by industrial development. They range from British aesthetes such as John Ruskin to the philosophers of the Frankfurt School and their adherents (Herbert Marcuse and Jacques Ellul) to radical writers of our own time, such as Amory Lovins, Jeremy Rifkin, and Chellis Glendinning. Kirkpatrick Sale firmly belongs to the last category of ideologues. The intellectual foundations of their attitude are well understood. One element is simply an intuitive dislike of change and novel, unfamiliar things, the "if it ain't broke, don't fix it" mentality. Another is the dislike of technology itself; while few people admit to a dislike of mechanical devices, there is an instinctive sense that they are unnatural, opposed to the carefree green pastures and sunny skies of an old bucolic world that industrial smoke has obscured forever. Bleak and lonely life in grim and grimy factory towns is compared with a Walt Disney image of friendly and cooperative peasant communities of rustic society. Changes in technology often alter the environment, which is vaguely felt to be sinful and somehow contrary to a human instinct to leave the world to our children in the same shape we found it.

There is more to this movement, however, than just nostalgia, bad history, and intuition. One perfectly rational element is risk aversion: Precisely because new technology is new, its exact consequences cannot be known in advance. Fear of a thalidomide-type debacle means that many new technologies are resisted not because their effects are known to be harmful but be cause their effects are unknown. There is some probability, no matter how small, that nuclear power will lead to a major radioactive disaster or that bioengineering will create a mutant virus that wipes us out. There is no social calculus that can prove these judgments wrong; no matter how small the likelihood, if one is unwilling to take any chances, new technologies will always be suspect. Some cases of unanticipated nasty side effects of a seemingly benign product, such as asbestos and chlorofluorocarbons, support these views.

A related argument is that new techniques often fail to pay for their full social costs: The new factories of the Industrial Revolution unworriedly polluted the air, although clean air was a scarce resource as well. Only much later was it fully realized that even resources that are not privately owned may be scarce and should figure in the cost-benefit calculus; in the meantime the environment may sustain major damage. It is also felt that new technology dehumanizes, turns people into slaves of their own technology, and is responsible for assorted social ills, from crime to loneliness. Whereas the standards of proof required in these accusations are often loose and the nostalgic look backward to an earlier and better period usually based on incomplete knowledge of the human condition before the Industrial Revolution, it would be rash to dismiss an argument just because it was technophobic.

The problem with Sale's book, however, is that he conflates the story of the Luddites, a self-interested group of victims, with his own ideological approach. He imagines preindustrial England as "a world based on an enclosed communitarian life, a high degree of non-market self -sufficiency, a simple system of local exchange and barterand traditions of mutuality lying outside the chaffer of the marketplace." The Luddites, he feels, were rebelling against the trans formation of this cloud-cuckoo land into an industrial wasteland in which they would become mindless and pauperized slaves of the omnivorous steam engine, the real villain of the Industrial Revolution.

Unfortunately for Sale's story, his record of the Luddite riots does not contain any evidence of an explicit ideology. The rioters in Northern England were simply frightened and destitute men, driven to desperation by forces they could only vaguely comprehend, but which they associated with machinery responsible for the decline in the demand for their labor. They be longed to a long tradition of machine breakers, going back to the 17th century, when gig mills were first introduced.

Machine breaking and forcible resistance to new technology of one kind or another oc curred in most industrial nations, with varying degrees of success. Inventors were often forced to flee for their lives, had their workshops burned down and their tools destroyed, and in a few cases were assassinated. Usually these acts were committed by people who perceived that their livelihood was threatened; sometimes machine breaking was simply a convenient and persuasive form of bargaining or an easy project for hooligans. Politics was only remotely involved. While the Luddites detested Britain's Prince-Regent, so did everyone else.

Sales's view that these Luddites were some kind of industrial Jacobins is unsustainable. The Luddites were simply responding to marketplace competition against which they could not prevail. They therefore attempted to muster non-market forces. Their objective was, depending on
the time and place, to get rid of the wide-stocking and lace frames that threatened the livelihood of cottage workers, of the gig mills (woolen finishing machines) that competed with skilled croppers in Yorkshire, or to stop the advent of power looms.

The unhappiness of the textile workers was compounded by the unusually bad economy in Britain between 1811 and 1813, when a combination of bad harvests and the disruption caused by warfare and blockade resulted in misery and unemployment throughout the country. The machines were a convenient scapegoat, but it is obvious that the workers sincerely believed the new contraptions were the cause of their poverty and that by destroying them they would im prove their material condition. Given the circumstances of the time, this was not an irrational response. Indeed, it seems that in Nottinghamshire the Luddite riots, despite their apparent failure, succeeded in slowing down the modernization of industry. Sale adds somewhat sheep ishly that for that reason the stocking industry became "among the most backward in the coun try." Should we infer that he considers that outcome to have been desirable?

The notion that these rioters were rebelling against an industrial and mechanized future and thus somehow shared the technophobic ideology espoused by modern radicals of the Barry Com moner and Bill McKibben type is fanciful. Sale laments the environmental damage inflicted by the Industrial Revolution and the disappearance of certain flora and fauna, and then argues that the Luddites reminded the rest of the population of the destructive effect of industrialization. The idea that the Luddites had any regard for the environmental implications of industrialization seems anachronistic, to say the least.

The related idea that the factory destroyed the social framework of mutual aid and "reci procity over the back fence" that Sale attributes to preIndustrial Revolution England is equally weak. The dependence of the English poor on the poor laws long before the Industrial Revolu tion indicates that this idyllic society of mutually supportive, responsible neighbors never ex isted. Moreover, modern research carried out by Lynne Kiesling of the College of William and Mary shows that in the 1860s the factory workers of Lancashire's cotton industry did all they could to support their close relatives and neighbors in time of need. The old informal safety net, such as it was, survived the coming of the steam engine.

The difference between the original Luddite rioters and the ideologues is clearly demon strated in this book. Sale's history of the Luddite riots, which occupies about two-thirds of the text, shows that they were obsessed with specific and local issues and grievances. On the other hand, according to Sale, modern technology and industrial society can get nothing right. They destroy the physical environment as they disrupt and displace the traditional forms of communi ties and societies; they eliminate jobs, pauperize workers, and increase inequality, leading to growing frustration and alienation, implausibly leading to the wars and refugee problems of the 1990s. He even manages on the same page to blame the "second Industrial Revolution" (by which he means technological developments since 1945) for overpopulation and the decline in male sperm count, presumably in the long run an inconsistent coupling.

In short, Sale's is the voice of the intellectual technophobe. He and his colleagues appear not to have personally suffered from modern technology; indeed some of them seem to have done quite well by it even as they rail against it. Sale repeats the standard accusations against modern technology, but his book is neither particularly well documented nor especially evoca tive. Where he differentiates his product from that of Rachel Carson and Ivan Illich is in his explicit attempt to co-opt the Luddite riots for his ideological purpose and to endow them with the values of activists chaining themselves to nuclear power plants or intellectuals on the talk -show tour. In this attempt the book fails to convince. Today's technophobes and Britain's Luddites of 18111816 have nothing in common.

Indeed, despite the alleged ravages inflicted by the "second Industrial Revolution" on modern society, Sale has to admit that Luddism is rare in the modern workplace. While a few instances of sabotage can always be cited, the modern work force seems oddly complacent in the face of the horrid damages caused, in Sale's account, by computers, chemicals, and other tools of technological destruction. Instead, modern "neo-Luddites" are non-specific or consumer-ori ented: the Union of Concerned Scientists, animal-rights groups, Greenpeace, and even unlikely organizations such as Aspartame Victims and Their Friends. Instead of machine breaking we have "ecotage," violent attempts to prevent acts alleged to be environmentally damaging.

Here and there Sale gets caught in inconvenient inconsistencies: He hails demonstrating French farmers disrupting traffic because "they were arguing for other values than those of capitalist enterprise, including rural communities and rural lifeways." Some cynics might suspect that the French farmer just wanted a larger slice of the industrial-capitalist pie. In any case, if these Luddite farmers have so much power, why were they not able to stop the proliferation of nuclear power plants in France?

The Luddites of England and the modern technophobe movements share one feature not acknowledged by Sale. Neither has been very successful in stopping the phenomenon they so detest. The Luddites were little more than a historical hiccup, as Sale is the first to admit. While he still feels their actions were "dramatic, forceful, honorable and authentic enough to have put the Luddites' issues forever on the record," it is clear that they did not make much of a dent in the progress of the Industrial Revolution. In similar fashion, the Sales and Rifkins of this world do not have a prayer of stopping modern technology, from computers to nuclear plants.

As long as they insist, with fellow-
traveler Wendell Berry, that a new contraption should be adopted only if it is cheaper, smaller, and locally made; uses less energy; does not disrupt anything good that already exists (including family and community relationships); does not infringe on the rights of other species (plants and animals alike); and does not harm the interests of the next seven generations, the "neo-Luddite" movement will inspire derision rather than effective technological resistance.

Creative Forces

info@reason.com (Joel Mokyr) — Sat, 01 May 1993 00:00:00 EDT

For those who, with Marshall McLuhan, have been prophesying a "global village" in which national boundaries have less and less economic and social significance, the last decade must seem perplexing, to say the least. Integration and disintegration have been conducting an indecisive battle in two dozen battlefields all over the world. The rise of an aggressive regional nationalism in Eastern Europe and Central Asia has been coupled with a growing sense of unity in Western Europe and North America.

Should economists be in favor of centripetal forces and support greater and greater centralization? To be sure, the opinion of intellectuals and college professors probably means little to Slobodan Milosevic or Margaret Thatcher (to name two of the more visible of the centrifugal camp) or their more internationally inclined opponents, such as Jacques Delors or George Bush. But in the very long run, the thoughts of ivory tower academic economists have had political influence beyond their wildest dreams: Adam Smith, for one, strongly believed in the folly of mercantilist policies that saw the state as the unit whose welfare should be central to economic policy. He pointed out that it was the consumption of the individual that counted. In order to achieve the most consumption for the most individuals, Smith taught, free trade was essential.

Modern economists, on the whole, still believe that Smith's insight was right. The vast majority of them would subscribe to the common-sense view that when Serbs try to do as well as they can for Serbia while Croatia does as well as it can for Croats, both Serbs and Croats will be worse off than if they maximize some joint objective and cooperate. The most obvious reason for this is that nationalism at times leads to war, which leaves everyone worse off. But even without war, single, small countries with closed boundaries tend to do less well than large, integrated economies. Open borders and trade allow specialization and thus make all trading nations wealthier, a statement that has been axiomatic to economics for more than two centuries.

Moreover, forcing local producers to compete not only with each other but also with foreign firms increases the pressure for efficient production and stimulates the adoption of more-productive technologies. It is hard to imagine, for instance, what the American car industry would have looked like without the growing competition of Japanese and European products in the 1970s. Furthermore, through trade and travel, nations learn from each other, imitate each other, and discover that some new ideas generated outside their cultures are useful and pleasurable. When Europeans imported Chinese cuisine, the Chinese learned to ride bicycles. Everyone gained.

All the same, an argument can be made that too much integration has costs as well. Trade and the exchange of ideas and knowledge are one thing, the coordination of policy, institutions, and laws quite another. In the extreme case of a world that has fully integrated its institutions and laws and is ruled by a central global government, no matter how benevolent and enlightened, economic progress would sooner or later come to an end and stagnation ensue. In part, this is simply because the gains from integration will eventually run into diminishing returns. Once we have fired all customs agents and eliminated all export subsidies, and workers and capital are free to settle wherever they maximize their returns, any additional increments would be harder and harder to achieve. But the main reason for stagnation is that in a global village the engine of economic growth would run out of fuel.

That engine is, was, and will always be technological creativity. Of course, other things are necessary for an economy to grow–capital accumulation, skills, motivation, well-functioning markets, and so on. But all other factors tend to have short-lived effects. They can increase income, but they tend to burn out after a while. Technology is the only thing that does not run into diminishing returns. There are no known limits to the human ability to control and manipulate the forces of nature.

Will globalization, assuming it defeats the surging powers of nationalism, enhance technological creativity? Again, based on past experience, the answer is ambiguous. A global village would, if its government is effective and peaceful, be a land of milk and honey. Such benefits have been realized in our own time in Western Europe and the Far East: Once Germany and France, or Japan and Korea, ceased fighting each other, they could redeploy their ingenuity from military to civilian objectives, with rather remarkable effects on living standards. The United States, which maintained peaceful coexistence among its constituent states over its history (with one major exception), is another example of this model.

Too much peaceful coexistence, however, may weaken international competitiveness and thereby dull the spur to technological creativity. Technological progress, even in civilian technology, is often made in tooth and claw. Without the pressure of competing neighboring states, societies may lose their cutting edge. Closed large empires, such as China, Russia, and the Ottoman state, though not entirely impervious to progress, could not sustain their creativity in the long run. In Western Europe, political fragmentation and the "states system" prevented such stagnation. No single European ruler ever managed to unite the entire continent under a single government. Competing political units held each other in check and guaranteed a high degree of political diversity. At different times Spaniards, Frenchmen, Germans, and Englishmen aspired to hegemonic power, but because they failed to establish a long-lasting empire, diversity and competitiveness were maintained, and creativity and innovativeness could not be suppressed.

In some cases, of course, reaction won: The heretic-burning Inquisition plunged much of Southern Europe into darkness after it had led the continent a century earlier in the great discoveries, and in Eastern Europe and the Balkan despotic regimes, rulers did all they could to keep their nations in the dark aye. But the competitive nature of the states system is a guarantee against such oppression. The threat that a new idea would be adopted by a rival nation and that innovative subjects would migrate elsewhere if ill treated was a powerful incentive to overcome the inevitable opposition to progress from conservative circles or vested interests.

From Peter the Great to Ataturk, the rulers of conservative nations realized that political survival required giving more freedom to technologically creative individuals. The "European miracle," to use a term coined by economic historian Eric L. Jones, could happen because the states system created a unique opportunity for gifted individuals to overcome the normal resistance of the establishment and to convert their creativity into a blessing for society.

Furthermore, competition spurred technology in direct ways. Especially after 187O, when the major European powers became steadily less friendly toward one another, the sense of one national identity competing against another was a powerful stimulus to many of the great inventors of the time, especially in Germany. Technical advances could save the fatherland. German, British, and French engineers tried to outdo each others in steel, chemicals, and electrical engineering, knowing full well how important this knowledge was to national security. Some of Germany's greatest inventors (Fritz Haber, the inventor of the nitrogen-fixing process, immediately comes to mind) were also ardent nationalists. Governments increasingly encouraged and subsidized research and development for national-security purposes.

The Cold War has had similar effects, and one might call this competitive creativity "the Sputnik effect": The shocking fear that the United States might fall behind in the "competition for technology" with the Soviet Union stimulated research and development in the United States after 1957 like nothing else. Indeed, some economists have been tempted to view competition between nation-states as comparable to the healthy and cleansing competition between firms in the free market. This is a simplification, because competing firms do not start wars against each other. But it has a kernel of truth.

A stronger version of this theory relies on what I have called "Cardwell's Law," after the British historian Donald Cardwell. This law states essentially that every society, when left on its own, will be technologically creative for only short periods. Sooner or later the forces of conservatism, the "if-it-ain't-broke-don't-fix-it," the "if- God-had-wanted-us-to-fly-he-would-have-given-us-wings," and the "not-invented-here-so-it-can't-possibly-work" people take over and manage through a variety of legal and institutional channels to slow down and if possible stop technological creativity altogether. Technological leaders like 17th-century Holland or early 1 9th-century Britain lost their edge and eventually became followers.

Many feel that the United States in 1993 is on the verge of succumbing to Cardwell's Law. After having led the world technologically for most of this century, the United States is gradually conceding many industries, from automotive to consumer electronics, to other nations. In many ways, reading Business Week today reminds one of the British press around 1900. An urgent sense of "we are not what we used to be" permeates the writing. It is as if technological creativity is like youthful vitality: As time passes, the creative juices gradually dry up, and sclerosis sets in. Societies become increasingly risk-averse and conservative, and creative innovators are regarded as deviants and rebels.

From a global point of view, the historical process can be likened to a relay race: Each society carries a torch for a short time before it hands it on to the next bearer; but all bask in the light. As long as there is a society to hand the torch to the next one, once the current bearer has worn itself out, technological progress can continue. There is thus safety in numbers: If there are enough states whose institutions are independent of each other, a replacement is likely to be found when the institutions of a technological leader turn against innovation, as they almost inevitably will.

The exact form that technological reaction will take differs from society to society. In some cases, reactionary governments simply close economies off to the rest of the world, and an iron bureaucracy either suppresses innovation altogether or channels it in directions deemed worthy by the rulers. This happened in Tokugawa Japan, Qing China, and Communist Albania; it is happening in Myanmar (Burma) and North Korea today.

In other cases, vested interests will use violence to block progress. The Roman Emperor Tiberius is reported to have executed an inventor who claimed to have come up with unbreakable glass, out of fear for his interests in glass making. Nineteenth-century inventors often fled for their lives to escape vengeful artisans. Professional trade associations, craft guilds, and regulations ossified the production process and made it impossible to deviate from established rules. Labor unions, with some exceptions, have been traditionally hostile to machines, which they feared would take their jobs.

In our time, well-meaning environmentalists, greedy product-liability lawyers, and feather-bedding unionists are contributing to the problem. Simply put, Cardwell's Law works because technological creativity is a delicate and fragile flower that needs just the right institutional environment to thrive. Yet in a truly dialectical manner, its very success usually destroys the environment it needs to survive.

If the global village is to consist of coordinated institutions and unified laws (and not just the free movement of goods and people between different countries), technological progress could disappear altogether from our world, because by definition there would be no one to take over once Cardwell's Law took full effect. This has happened before: The Roman Empire, the closest the "world" ever got to a global village, was surprisingly uncreative technologically and was rescued from complete stasis only by non-citizens living outside it. Much the same can be said about the Chinese Empire in its last centuries. For its citizens, it was "the world," and its repressive institutions encountered no outside competition. The result was that the Chinese fell rapidly behind more creative societies, and they were in for a rude awakening when the proud empire was humiliated by its defeat in the Opium Wars of the 1840s.

What this story suggests is that the unification of Western Europe in an ever tighter E.C., if it occurs, might involve unexpected long-term costs. A France and a Germany more closely integrated in the E.C. are less likely to fight. As their institutions and laws become more and more like each other's, diversity and competitiveness will be reduced. If this trend continues, global diversity and competition could be endangered. We are still a long distance from this, and it is not yet clear how far the trend has gone.

Moreover, a partial integration such as the E.C. may be a net improvement. After all, a world consisting of a small number of large, open, but distinct and competitive "villages" in a "Global County" might be the best of all possible outcomes. The loss of internal competition within Europe, with the growing unification brought on by the E.C., could be offset by a growing competition between a European "village," a North American "village," a Pacific "village," and so on.

For this utopian outcome to occur, three important conditions have to be met. First, the blocs have to remain separate and competitive. Second, nationalism should not be allowed to weaken the blocs internally. This has already happened in Eastern Europe and the Balkans, with devastating results. It is unlikely to happen in North America, and the North American Free Trade Agreement clearly strengthens this bloc (although Quebec separatism is an unhappy exception). Finally, the competitive game between the blocs must remain firmly committed to peaceful rules: Trade wars, let alone another Pearl Harbor, would be devastating to it.

The historical parallel is Europe between 1850 and 1914, an era of unprecedented technological development growing out of healthy competition, all brought to naught by World War I. The Cold War had similar technological side benefits; but a number of times it got a little too close to the brink for comfort. Competition between nation-states is a knife-edged point: Too little of it may lead to stagnation, but too much could lead to catastrophe. Maneuvering between the twin possibilities of the eruption of disastrous war and global lethargy is not going to be made easier by Muslim fundamentalism, Balkan tribalism, Oriental ethnic arrogance, or Western xenophobia. Yet these dangers have always been there. In retrospect, the most surprising thing is perhaps that we have come this far.