Thursday, January 22, 2015

What to do with the fast pace of technology

TIME’s Rana Foroohar is concerned about how technology is making all of us less trusting.  It’s moving too fast, she says, at least for the average Joe.  

Backing her up is the 2015 Trust Barometer Survey, released every year at the World Economic Forum in Davos that’s ongoing now.  Two out of every three consumers in the 27 countries surveyed said they were unable to cope with the fast pace of technology development.  Ms. Foroohar didn’t mention this, but we’re already on the knee of the technology exponential.  As change moves into the vertical part of the curve and accelerates at a blinding pace, what will consumers do then?  Taking a Trust survey will be pointless.

I suppose this might be why she’s so concerned.  Warning to tech giants: The average Joe, she believes, will line up behind politicians promising to do something about it.  

What might they do?
Expect more push back on sharing economy companies that skirt local regulation, a greater focus on the monopoly power of mammoth tech companies, and closer scrutiny of the personal wealth of tech titans themselves.
You’ve been warned, Tech Giants.  Get with it, or else.

Or else what?  Let’s see . . . “expect more push back,” she says.  Who is doing the pushing in the first place?  Companies like Apple, Google, Amazon, Microsoft, or IBM?  When was the last time you saw Jeff Bezos or Tim Cook “pushing” something in the coercive sense?  Whatever it is they’re offering can always be declined.  Millions of people do it.  The phrase “No, thanks” comes to mind.  Average Joes are free to use it whenever they wish.  Even Joes way above or below average have been known to use it.  

Maybe they’ve been habituated with government programs that don’t allow saying no without suffering a penalty, like the income tax and ObamaCare. 

Note: Governments push in the coercive sense.  They also push back coercively whenever their subjects resist laws or regulations they don’t like.  

But aren’t these tech mammoths monopolies?  If they were, they’d be pretty much impervious to competition and consumer wishes.  That’s hardly the case with the ones making headlines with new products.  To repeat: Anyone uncomfortable about the pace of technology can stop buying the gadgets and services the techs are offering. 

I don’t question the veracity of the Trust Barometer survey, but I would like to remind Ms. Foroohar of another poll taken every day, 24/7.  I’m referring to the free market, of course, where surveys are carried out by way of the buying decisions of consumers.  Unlike other surveys this one is comprehensive.  It is democracy in action, people voting or abstaining from voting by buying or not buying.  Want to get a tech giant’s attention?  Stop buying their products.  They’ll get the message.

We all know people who don’t embrace the latest and greatest.  I have a buddy who is very happy with his iPhone 4s and not at all interested in the latest models.  I have another friend who would almost prefer death to using any digital device.  A very prolific writer still uses PC-AT keyboards of the 1980s because he found they get the job done better than newer ones.  I promised my father shortly before his death that I would get our mother to use email.  Never happened, and she was perfectly content without it.  My siblings wade slowly into the tech world, but they’ve never mentioned being overwhelmed by it. 

Of those who buy digital gadgets or do their shopping online, the message consumers are sending is give us more — more features, more memory, faster processors, more delivery options — at the same or lower price.  Most of them can’t wait to get something better.  Knowing this is where their profits lie, tech companies do what they can to comply.  This is capitalism in action.  This is freedom in action.

For decades we’ve heard how fabulously rich some of the “tech titans” are, and now that a consumer survey shows distrust is in the air Ms. Foroohar expects government to scrutinize their wealth more closely.  She doesn’t say why, but I suppose it has something to do with envy.

Long ago sociologist Franz Oppenheimer made the distinction between the political means and the economic means of acquiring wealth.  The first is by theft, the second, production.  The state provides the political means of getting rich through confiscation and favors — favors that include antitrust investigations targeting one’s competitors, for example.  Any big company that wants no part of politics would soon change course, as they become ripe targets for bribe-seeking legislators who threaten some new regulation or investigation.  It is the state apparatus, not the free market, that makes possible entrenched business corruption.  Rent-seeking, as it’s called, is a way of increasing one’s share of existing wealth without creating wealth.  

And speaking of monopolies . . .

Why is she so concerned with the threat of monopolistic power yet makes no mention of actual monopolies, such as the state itself and its counterfeiter, the central bank?  As noted above we can remove ourselves from the effects of any market entity but how in the world can average Joes avoid the greedy and threatening reach of the state?  How can they avoid losing wealth if they have no other option than the central bank’s monopoly money?

Maybe technology and entrepreneurship will solve these problems in short order.  I hope so.

Ms. Foroohar, a graduate of Columbia, a member of the Council on Foreign Relations, and an occasional commentator on various TV shows, is well-aware of the points presented here, I’m sure.  Why she turns her back on them is a mystery.  

Tuesday, January 13, 2015

Kurzweil's Black Swans

What can we expect in 2015?  Global recession and civil disorder top the list, according to what I read.  Given the way central banks and governments have sabotaged free markets at every turn, coupled with the belligerent nature of U.S. foreign policy and the militarization of our police, both forecasts strike me as plausible. 

But the plausible doesn’t need forecasting, does it?  We need to be reminded of it, certainly, and in that sense it’s critical.  But what we really want to know is: Are any black swans on the horizon?

There are two problems with black swans.  One is predicting them: how do you predict an event that by definition comes as a surprise?  The other is convincing people that this surprising event will in fact occur.  

We all know what happened to the price of oil, but how many prognosticators provided advanced warning of a sharp downturn?  Michael Lynch is one, to an extent.  Are there others who called the drop and who also are not known for making “stopped watch” predictions, as Lynch calls them?

According to gasbuddy.com, gas prices nationally dropped 6.5 cents in the last week, to $2.119/gallon.  
Since last week, some 12,000 stations dropped their price under $2/gal, with 45.1% of all gas stations (nearly 61,000) now selling under the $2/gal mark. The national average currently stands at its lowest since May 9, 2009, a date that saw 8.9% unemployment . . .
If someone had put this in writing a year ago he or she would’ve been regarded as crazy or Nostradamus.  Who is on record for saying gas prices would drop like a brick?  For most people this was a black swan.

But there are problems with what seems plausible, too.

Certain Austrian economists predicted serious price inflation following the Fed’s unprecedented expansion of the monetary base in 2008-2009.  Quite plausible, given Austrian theory.  If the new money had reached the buying public, we almost certainly would’ve seen a rapid rise in prices as the fractional reserve multiplier kicked in.  But most Austrians and other economists didn’t foresee Bernanke paying banks not to lend the money he created.  Nor perhaps did they fully account for the astronomical debt held by households and businesses, making them adverse to borrowing, or the commercial banks’ reluctance to lend in such an environment.

The non-event of high price inflation struck many analysts as a black swan.

Can we make any reliable predictions of the kind that would surprise almost everyone if they occurred?  Is there any radar anywhere on which black swans are visible?

The answer is no if by black swan we’re looking for a specific event at a specific time.  The answer is a profound yes if we mean there are changes coming that will hit almost everyone over the head.

According to Wikipedia the first smartphone patent was issued to Theodore G. Paraskevakos in 1973, the first devices went on sale in the early 1990s, and today there is fierce competition among companies to make them as powerful and affordable as possible.  I cite the example of smartphones because most people are familiar with them, and as information technologies they’re subject to the law of accelerating returns.  

It is this law that will produce radical changes in the near future and which people seem both to expect and disbelieve at the same time.  

On the knee of the exponential

To quote Ray Kurzweil from his March 7, 2001 essay:
An analysis of the history of technology shows that technological change is exponential, contrary to the common-sense “intuitive linear” view. So we won’t experience 100 years of progress in the 21st century — it will be more like 20,000 years of progress (at today’s rate). The “returns,” such as chip speed and cost-effectiveness, also increase exponentially. There’s even exponential growth in the rate of exponential growth. Within a few decades, machine intelligence will surpass human intelligence, leading to The Singularity — technological change so rapid and profound it represents a rupture in the fabric of human history.  [Italics in original]
I encourage you to read his first sentence a second time.  Common sense will be blind to the technological changes coming.  The incremental advances in smartphone technology will take flight, along with other technologies, as progress reaches the “knee” of the exponential curve (the point at which the exponential trend becomes noticeable).  We are near or on that knee right now.  
The first technological steps — sharp edges, fire, the wheel — took tens of thousands of years. For people living in this era, there was little noticeable technological change in even a thousand years. By 1000 A.D., progress was much faster and a paradigm shift required only a century or two. In the nineteenth century, we saw more technological change than in the nine centuries preceding it. Then in the first twenty years of the twentieth century, we saw more advancement than in all of the nineteenth century. Now, paradigm shifts occur in only a few years time. . . . 
As exponential growth continues to accelerate into the first half of the twenty-first century, it will appear to explode into infinity, at least from the limited and linear perspective of contemporary humans. The progress will ultimately become so fast that it will rupture our ability to follow it. It will literally get out of our control.
If Kurzweil were a kook with a blog it would be easy to dismiss him.  But forget that.  Ray Kurzweil is such an accomplished individual it is difficult to summarize his achievements in a brief article and do him justice.  He is a best-selling author, computer scientist, inventor, futurist, entrepreneur, documentary producer, lecturer, and director of engineering at Google.  As a teenager in 1965 he appeared on Steve Allen’s I’ve Got a Secret and played a piano piece composed by a computer he built. According to Wikipedia,
He has received twenty honorary doctorates, and honors from three U.S. presidents. Kurzweil has been described as a "restless genius" by The Wall Street Journal and "the ultimate thinking machine" by Forbes. PBS included Kurzweil as one of 16 "revolutionaries who made America" along with other inventors of the past two centuries. Inc. magazine ranked him #8 among the "most fascinating" entrepreneurs in the United States and called him "Edison's rightful heir”.
People have faulted him for his perennial optimism, but as he says entrepreneurs are predisposed to optimism.  He’s famous for his predictions, which he discusses in extensive detail here.  He writes:
Fundamental measures of information technology follow predictable and exponential trajectories, belying the conventional wisdom that “you can’t predict the future.” There are still many things — which project, company or technical standard will prevail in the marketplace, or when peace will come to the Middle East — that remain unpredictable, but the underlying price/performance and capacity of information is nonetheless remarkably predictable. Surprisingly, these trends are unperturbed by conditions such as war or peace and prosperity or recession.
In his 1990s book The Age of Spiritual Machines he made 147 predictions for 2009.  Of these 127 were correct or essentially correct (86%), 17 were partially correct, and 3 were wrong — according to his analysis.

Kurzweil's swans

Some of his predictions for the years ahead, which he made in late 2013, include:
  • By the early 2020s, we will have the means to program our biology away from disease and aging.  We already have the tools to reprogram our biology the way we reprogram our computers.  “RNA interference, for example, can turn genes off that promote disease and aging.”
  • By 2030 solar energy will have the capacity to meet all of our energy needs. The production of food and clean water will also be revolutionized. “The total number of watts of electricity produced by solar energy is growing exponentially, doubling every two years. It is now less than seven doublings from 100%.” Once we have inexpensive energy we will be able to convert all the bad water on the planet to usable water.  Agriculture will go from horizontal to vertical, where we will grow high-quality food in AI controlled buildings.
  • By the early 2020s we will print out a significant fraction of the products we use including clothing as well as replacement organs.  The early 2020s will be the golden age of 3D printing.  We’ll be able to choose from thousands of open source clothing designs and print them out at pennies per pound.  “We can already experimentally print out organs by printing a biodegradable scaffolding and then populating it with a patient's own stem cells, all with a 3D printer.  By the early 2020s, this will reach clinical practice.”
  • Within five years, search engines will be based on an understanding of natural language. “At Google, we are creating a system that will read every document on the web and every book for meaning and provide a rich search and question answering experience based on the true meaning of natural language.”
  • By the early 2020s we will be routinely working and playing with each other in full immersion visual-auditory virtual environments. By the 2030s, we will add the tactile sense to full immersion virtual reality.  The latter will require “nanobots [nanometer-size robots] traveling noninvasively into the brain through the capillaries and augmenting the signals coming from our real senses.”
For a robust discussion of how these and many other technological changes will radically alter our lives, please see Kurzweil’s book, The Singularity is Near: When Humans Transcend Biology. 







Saturday, December 20, 2014

Counterfeiting is the health of those who rule us

I found this re-posted on a Facebook page today, having originated from End the Fed


This is not so much posing a question as making a point.  Nevertheless, how might a contemporary economist (i.e., an inflationist) address such a query, assuming it was serious?  Here’s how I imagine she might go about it in an offhand manner.

In the US, counterfeiting is illegal only when some person or organization other than the Federal Reserve Open Market Committee practices it.  When politically-appointed bureaucrats print money, it's not only legal it's essential to the health of the economy.  If you don't believe me read the textbooks.  It turns out that what’s true on a micro level — that counterfeiting is theft — isn’t true on the macro level.  Only those committed to the principles of the Austrian school would disagree.  And the world today little resembles the teachings of the Austrian school.

Without the Fed and its fiat machine we would have to rely on the market to provide the money necessary to maintain the division of labor.  The market, that wild beast forever in need of government restraint, would control the most critical element of the economy.  Consider: The Fed-less market of the 19th century brought us price deflation.  Price deflation -- lower prices -- the ultimate nightmare.  Far better to have the spotless bureaucrats of the Committee debase the currency so that goods keep rising in price.  Chairman Greenspan once reminded us of the overwhelming success they've had driving the “price level” through the roof.  As any poor person will assure you, having one’s money buy less is a godsend.

Shhh.  Listen.  That tap-tap-tap you hear is a banker probing in the darkness of his empty vault.  That could be the big banks' fate if the Greenspan - Bernanke - Yellen combo couldn't make unlimited amounts of money snap into existence.  How could the federal government ever keep the economy from imploding and shore-up our inalienable entitlements if the big banks dried up?  If it had to rely on greedy taxpayers for all its funding and borrowing?  If it couldn't swap its IOUs for freshly minted digits?  If the Fed couldn't tap its computer to create those digits?

In other words, if it couldn’t counterfeit?

The Federal Reserve Act was signed into law by Thomas Woodrow Wilson, 28th president of the United States, on December 23, 1913.  As such we should remember the Fed this Christmas and every Christmas —  every day! — for without it we would've had no "war to end all wars" and its record-setting slaughter, no Great Depression, no follow-up world war, and no modern world plagued with the fallout from Keynesianism.  

Let's not forget Mr. Wilson, either, usually regarded as among the top ten greatest presidents.

If war is the health of the state, then counterfeiting is the health of war. Taxes alone wouldn't begin to provide the revenue needed to keep the rest of the world in line and the home folks dependent and obedient.   Onward central bankers!  Onward counterfeiting! 

Conclusion

Offhand, I can't think of a bigger racket than central banking and fiat money.

Wednesday, December 3, 2014

Think small — very small — incredibly small

Do you have forebodings about the future?  I do, which is why I’ve been looking closer at the transformations technology promises to bring us.

First, a brief review.  I’ve previously written about the rapid pace of technological development (here and here) and Ray Kurzweil’s point that though technology is growing exponentially, we experience it linearly, and we tend to base our expectations on our linear experience.  (See his essay “The Law of Accelerating Returns” for details.)




Here’s an example. When the Human Genome Project began in 1990 he predicted the project would be completed in 15 years.  Almost no one believed him.  After a year of work, biochemists had succeeded it transcribing one ten-thousandth of the genome.  Seven years later a mere one percent had been finished.  One imagines the laughing was well underway.  But the project actually finished ahead of schedule, in 2003.

In The Singularity is Near Kurzweil explains how this happened:
Scientists are trained to be skeptical, to speak cautiously of current research goals, and to rarely speculate beyond the current generation of scientific pursuit. This may have been a satisfactory approach when a generation of science and technology lasted longer than a human generation, but it does not serve society’s interests now that a generation of scientific and technological progress comprises only a few years.
He has been amazingly accurate in his predictions, and over the years he’s turned those predictions into a fortune inventing and marketing products based on his expectations of the technologies that will be available in years ahead. “Invention is a lot like surfing,” he says, “you have to catch the wave at the right time.”

Kurzweil sees three overlapping areas where growth is increasing exponentially and which will transport us to a world formerly associated with science fiction and fantasy: genetics, nanotechnology, and robotics.  

Our atomically-precise future

In this article I want to discuss nanotechnology — a term popularized by K. Eric Drexler in his 1986 book Engines of Creation: The Coming Era of Nanotechnology (online here) — and its implications for our economic lives.  

By “nanotechnology” Drexler means “technology based on the manipulation of individual atoms and molecules to build structures to complex, atomic specifications.”  To distinguish his meaning from other, more inclusive definitions he uses the term atomically-precise manufacturing (APM).  APM will build things by rearranging atoms and using those nano-structures as building blocks for larger products.

What kinds of products?  Everything being built today by conventional means and other products that can’t be built today.

Materials are characterized by their arrangement of atoms — if we rearrange the atoms in coal a certain way we can produce a diamond.  Atomically-precise control of materials can produce patterns of atoms that are out of reach of today’s technologies.

Atomic precision starts with small-molecule feedstocks, atomically precise by nature and often available at a low cost per kilogram. A sequence of atomically precise processing steps then enables precise control of the structure of materials and components, yielding products with performance improved by factors that can range from ten to over one million.  [my emphasis]
APM will change industrial production beyond recognition or replace it outright.  
Traditional manufacturing builds in a "top down" fashion, taking a chunk of material and removing chunks of it - for example, by grinding, or by dissolving with acids - until the final product part is achieved. The goal of nanotechnology is to instead build in a "bottom-up" fashion, starting with individual molecules and bringing them together to form product parts in which every atom is in a precise, designed location.  [Foresight Institute]
APM-based technologies will [from Drexler, Radical Abundance]:
  • Slash resource consumption and toxic emissions
  • Provide the infrastructure for low-cost solar energy and a carbon-neutral economy
  • Produce better products at far lower cost than today
  • Collapse long specialized supply chains to a few steps of local production
  • Transform daily life, labor, and the structure of society on Earth, just as the agricultural, industrial, and information revolutions have done
Drexler likens APM to digital technology transferred to the material world, in which microblocks are combined much like ink droplets to form endless, intricate patterns.
A better analogy than ink droplets, however, would be blocks of the sort found in high-end Lego sets, which include not only blocks in different shapes and colors, but also blocks that provide intricate, functional parts such as motors, gear trains, sensors, and computers.
When advanced APM arrives within the next decade you’ll have a box on your desk that will allow you to do with atoms what you presently do with bits and pixels.  At roughly the same price.  But without worrying about atoms, just as you don’t concern yourself with bits and pixels.  On a larger scale, advanced APM will mean, for example,
replacing an enormous automobile factory and all of its multi-million dollar equipment with a garage-sized facility that can assemble cars from inexpensive, microscopic parts, with production times measured in minutes. 
The technologies that can make these visions real are emerging—under many names, behind the scenes, with a long road still ahead, yet moving surprisingly fast.
The need for engineering

As with the stunning nature of Kurzweil’s predictions for the decades ahead (which you really ought to check out), it’s difficult to imagine the economic world as we know it being turned upside down because we’re slipping past the knee of an exponential curve.  Yet APM is not waiting for some scientific breakthrough to make it a real possibility.  The road ahead “has no gaps, no chasms to cross,” Drexler says.

What is missing from APM research?  Better engineering; specifically, “AP molecular systems engineering.”
No matter how research-intensive a project may be, work coordinated around concrete engineering objectives will eventually be required to produce concrete engineering results. . . . 
The semiconductor industry provides a model for coordinating research to advance the technology of an entire field. What’s more, the achievements of semiconductor engineers give us a sense of the potential scale of results, for it was their work that brought us nanoscale digital information systems and today’s Information Revolution.
Roadmapping has been the key to the success of the semiconductor industry.  

In 2007, under the auspices of the Waitt Family Foundation, researchers in nanotechnology finally produced a guiding document for their field: Productive Nanosystems: A Technology Roadmap.  The Executive Summary tells us that: 
It is uncontroversial that expanding the scope of atomic precision will dramatically improve high-performance technologies of all kinds, from medicine, sensors, and displays to materials and solar power. Holding to Moore’s law demands it, probably in the next 15 years or less. [My emphasis]
Assuming the document is up-to-date, APM should be here by or before 2022.  Mark your calendars.

3D Printing — a hint of the APM future

The nascent technology of 3D printing is a stepping stone between traditional manufacturing methods and APM.  Drexler contrasts 3D with traditional processes:
Some traditional methods make a shape all at once using a costly, specialized tool, like a mold to shape plastic, a die to stamp steel, or an optical mask in semiconductor lithography. Other traditional methods carve shapes by removing small bits of material using general-purpose equipment like lathes, drills, and milling machines. 
3D printing, by contrast, makes shapes by adding small bits of material using general-purpose machines guided by digital data files. 3D printing can make shapes beyond the reach of casting or carving.
One 3D printer is a kit you assemble yourself called the RepRap.  With a RepRap 3D printer, you can “print” the parts that make up a RepRap and assemble them yourself.  According to the video at the RepRap website, the RepRap project aims to put a factory in every home — a factory that can make more factories.  RepRap has a slogan, “wealth without money.” 

RepRap and other 3D printer user communities stir memories of the Homebrew Computer Club that launched the PC revolution in the mid-Seventies.  The Club spawned many pioneers in the microcomputer industry, including the two Steves.  The MITS Altair 8800 was one of the first kit computers, comparable to the RepRap today.  Unlike Altair, RepRap can self-replicate.

Conclusion

There are downsides to every technology.  As with clubs and axes once used to obtain food and shelter, APM technologies can be weaponized.  The good news is that APM, like information technologies, has a strong decentralizing and price deflationary component.  In this sense it works in favor of individuals and free markets, and against the Keynesian states we live under.  The APM revolution has the potential to dramatically empower people, as we’re seeing with the information revolution today. 

Though there are many questions one could raise about APM, I have one in particular that I invite any APM researcher to address: If APM continues to develop into a Kurzweil future, will someone someday be able to “print” gold and other precious metals?  

And further: The whole of economics is based on scarcity.  APM won’t eliminate scarcity, but it could surely relegate it to a position of less importance since common feedstocks will replace scarce resources.  What does a world with scant scarcity look like?

We are encouraged by psychologists to live in the present, in the here-and-now.  The here-and-now has many dimensions, one of which is the legacy of innumerable statists.  I look forward to a “present” when their legacy is found only in history books.  Technology will help get us there.

Friday, October 24, 2014

Who rules? Information Technology

Natural systems show us only lower bounds to the possible, in cell repair as in everything else.  — K. Eric Drexler, Engines of Creation, p. 105
Our ability to create models— virtual realities—in our brains, combined with our modest-looking thumbs, has been sufficient to usher in another form of evolution: technology. That development enabled the persistence of the accelerating pace that started with biological evolution. It will continue until the entire universe is at our fingertips. — Ray Kurzweil, The Singularity Is Near: When Humans Transcend Biology (Kindle Locations 9409-9412; all subsequent references in this format refer to this source) 
The combination of nanotechnology and advanced AI will make possible intelligent, effective robots; with such robots, a state could prosper while discarding anyone, or even (in principle) everyone. — K. Eric Drexler, Engines of Creation, p. 176

Along with the massive money printing and debt-laden economy our overlords insist we need, there is another economy, so to speak, that defies their intentions.  In the world of technology the Keynesian horror known as price deflation is the overpowering fact.  Far from bringing economic calamity, the accelerating growth of a widening range of technologies is proving resistant to the Keynesian virus of central bank inflation.  And as these technologies merge with our minds and bodies in increasingly diverse and intimate ways, decentralize and revolutionize nearly every aspect of our economy and culture, the world as we know it today will disappear during our lifetimes.

There are at least three reasons why today’s world will soon be ancient history:

1. The life force of capitalism (creativity, entrepreneurship, competition, free markets) is still alive, especially in information technology. 
Ray Kurzweil (March 31, 2011 interview): The smartphones we carry around in our pockets are a billion times more powerful — per dollar —  than the computer I used at MIT in the late 1960s.  They're also 100,000 times smaller.  In 25 years our cell phones will be the size of a blood cell and more powerful. (6:10)
2.  Once a technology becomes an information technology it is subject to the Law of Accelerating Returns, meaning it advances exponentially.
Human biology and medicine historically progressed at a linear rate until they were transformed by information technology.  When the government version of the Human Genome Project began in 1990, for example, critics said it would take thousands of years to finish, given the speed at which the genome could then be scanned.  Yet the 15 year project finished slightly ahead of schedule.
3.  The spread of information technology introduces a deflationary effect that expands with advancements in technology.
You could buy one transistor for a dollar in 1968; in 2002 a dollar purchased about ten million transistors. (Kindle 1232)
Despite [the] massive deflation in the cost of information technologies, demand has more than kept up. The number of bits shipped has doubled every 1.1 years, faster than the halving time in cost per bit, which is 1.5 years.  As a result, the semiconductor industry enjoyed 18 percent annual growth in total revenue from 1958 to 2002.  The entire information-technology (IT) industry has grown from 4.2 percent of the gross domestic product in 1977 to 8.2 percent in 1998. (Kindle 1263-1266)
As Kurzweil has often articulated, exponential growth itself is growing exponentially and applies to a wide range of technologies, from electronic to biological.  Nor does growth depend on a specific paradigm, such as Moore’s Law (shrinking of components on an integrated circuit).  Since the U.S. census of 1890, there have been five paradigms of computing, each one showing exponential growth in price-performance — electromechanical, relays, vacuum tubes, discrete transistors, and integrated circuits.  Each of these paradigms follows an S-curve life cycle — slow growth, followed by explosive growth, ending in a leveling off as it matures.

As a paradigm begins to stall, pressure grows for a replacement paradigm.  Engineers were shrinking vacuum tubes in the 1950s while transistors were making their way into portable radios, and they later replaced vacuum tubes in computers.  Moore’s Law will fade around the end of this decade and will be replaced by a sixth paradigm, which will likely be three-dimensional molecular computing. 

More specifically, researchers have been experimenting with nanotubes — carbon atoms rolled up into a seamless tube — to replace silicon in computers.  Because they’re very small nanotubes can achieve very high densities.  Last year, Stanford University engineers built a carbon nanotube computer that was comparable in performance to a 1971 Intel 4004.  Peter Burke at California/Irvine in the peer-reviewed journal Nano Letters says the theoretical speed limit of nanotube transistors should be one terahertz (1,000 GHz).  Kurzweil estimates that a cubic inch of nanotube circuitry would be up to 100 million times more powerful than the human brain. (Kindle 1893) 

Working smarter 

As the computing substrate evolves and becomes orders of magnitude faster, we’re seeing evidence that the software component will lag only slightly behind the hardware advancements.

IBM’s Deep Blue defeated chess champion Garry Kasparov in 1997.  Deep Blue, though, was an expensive supercomputer built for that one purpose.  Less than a decade later Deep Fritz 10, running on a desktop PC with two Intel Core 2 Duo CPUs, accomplished a similar feat by defeating the undisputed world champion Vladimir Kramnik in Bonn, Germany.  More recently Christophe Théron's Tiger chess engine, which won tournaments between 2000-2002, has found a home on Apple’s mobile devices. 

Desktop computers and smartphones lack the speed and capacity of 1990s supercomputers.  So how can they be so good at playing chess?  

In The Age of Intelligent Machines (p. 130), Kurzweil estimated that it would take about 40 billion years to make the “perfect” move in a typical chess match, assuming a 30-move game in which a computer would analyze 8^30 possible moves at the rate of one billion moves per second.  (As Kurzweil notes the computer would probably blow up with Big Bang II before the first move was determined.)  Rather than attempt the perfect move, human players consider various paths and “prune away” unpromising moves based on pattern-recognition judgments.

That’s how humans approach chess.  That’s also how Deep Fritz plays chess.  Chess software has become more human-like.

The Evolution of Watson

Watson, the IBM supercomputer that defeated Jeopardy!’s two all-time champions in 2011, added a new element to computer evolution with its advanced natural language abilities.  Watson could not only “read” and retain massive amounts of English-language content, it could understand Alex Trebek’s queries (which were often tricky), determine the probability that it knew the correct answer, and decide whether to respond or not.  Watson had to do all this in less than three seconds, on average.  To meet this challenge IBM developed a computer architecture called DeepQA. (QA refers to question answering.) 

Since donating Watson’s million-dollar Jeopardy award to charities, IBM has opened up six Watson Client Experience Centers around the world, with headquarters in a new, glass-walled office building at 21 Astor Place in Manhattan’s East Village.  In partnership with Spain’s CaixaBank, Watson is now learning Spanish, too.

Perhaps we should be addressing it as Dr. Watson.  Watson can read two hundred million pages of clinical data, cross-reference the symptoms of one million cancer patients or read millions of current medical journals to test hypotheses.  It can do any of these tasks in 15 seconds or less.
So, for example, the query: “Which disease causes ‘Uveitis’ in a patient with a family history of arthritis presenting circular rash, fever, and headache?”, a traditional search engine would answer with a set of links to web pages which a domain expert then has to read through in order to get the relevant information. 
If you ask the same question to Watson, the answer would be: 
76% Lyme disease,
1% Behcet’s disease,
1% Sarcoidosis
And Watson has trimmed down considerably.  The version that starred on Jeopardy occupied a large, air conditioned room that was connected to the TV show through an avatar.  Today’s Watson, according to IBM, is 24 times faster, 90 percent smaller and delivered from the cloud.  Watson has gone from the size of a master bedroom to three stacked pizza boxes.  The latter will seem huge when Watson becomes available on mobile devices.

Can Watson pass for human?

How would Watson technology do in a well-designed Turing test?  Better than most but it still lacks some of the subtleties most people regard as uniquely human.  Alan Turing designed the test on the grounds that if a machine can think it can pass for human.  According to Kurzweil
there are no simple language tricks that would enable a computer to pass a well-designed Turing test. A computer would need to actually master human levels of understanding to pass this threshold.
And when a computer does pass that threshold, Kurzweil will regard it as human.  There of course will be controversy over the results.  By the time most people concede that machines can think, Kurzweil contends, they will already be “thousands of times smarter than us.”  Which means that a strategy for passing the test will be to dumb itself down, which it will easily be smart enough to do.

Given the exponential price-performance growth of technology, he projects that the hardware to simulate the human brain will be available for $1,000 by 2020.  This assumes a PC capable of operating at 10^16 (ten quadrillion) calculations per second, using dedicated ASIC chips, and harvesting unused computational capacity of the internet.  The software to replicate the functions should take about a decade longer.  He’s betting that by 2029 a computer will pass Turing.  “By 2030 it will take a village of human brains (around one thousand) to match a thousand dollars’ worth of computing.”

The engines of revolution

While information technology drives the “strong AI” movement to make computers indistinguishable from humans, it is also engaged in a balancing act elevating humans far beyond their biological origins.  Kurzweil refers to this as the Genetics - Nanotechnology - Robotics revolution.  

Together, these overlapping developments will usher in what he calls the Singularity, “a future period in which technological change will be so rapid and its impact so profound that every aspect of human life will be irreversibly transformed.” [Transcendent Man, the movie]  Kurzweil’s estimated date for the Singularity is 2045 — thirty-one years from now.

So far, most of his many predictions have been either correct or essentially correct.

We are already well underway to the Singularity with the Genetics revolution:
By understanding the information processes underlying life, we are starting to learn to reprogram our biology to achieve the virtual elimination of disease, dramatic expansion of human potential, and radical life extension.  (Kindle 3675-3677)
With an increased understanding of biochemical pathways, researchers are finding ways to control gene expression.  By manipulating peptides (short chains of amino acids), for example, they are finding they can turn off disease-causing genes or turn on helpful genes that may not be expressed in a certain type of cell. 

Yet, reprogramming our biology will never elevate us beyond what Hans Moravec called second-class robots.  
The [nanotechnology] revolution will enable us to redesign and rebuild— molecule by molecule— our bodies and brains and the world with which we interact, going far beyond the limitations of biology.  (Kindle 3679-3681)
Researcher and author Robert A. Freitas, Jr., a pioneering nanotechnology theorist, has designed robotic replacements for human red blood cells called respirocytes that function many times more effectively than their biological counterparts.  A conservative analysis shows if you replaced a portion of your red blood cells with respirocytes, you could do an Olympic sprint for 15 minutes.  Without taking a breath. (Kindle 4675)

Freitas estimates that eliminating 50% of medically preventable conditions would extend human life expectancy to 150 years; eliminating 90% would extend it to 1,000 years or more.

But this is only the beginning.  Kurzweil predicts that over the next two decades 
we will learn how to augment our 100 trillion very slow inter-neuronal connections with high-speed virtual connections via nano-robotics.  This will allow us to greatly boost our pattern-recognition abilities, memories, and overall thinking capacity, as well as to directly interface with powerful forms of computer intelligence. The technology will also provide wireless communication from one brain to another.  
In other words, the age of telepathic communication is almost upon us.
Nanorobots, or nanobots as Kurzweil usually calls them, are robots of size 100 nanometers or less and will play an important role in our future.  They are programmable, introduced through the blood stream without surgery, and can be directed to leave our bodies.  They can rev up our brainpower or amuse us with virtual reality.  

We will be more machine than human, and in another sense, if man is indeed a thinking animal, more human than ever.  
Once our brains are fully online we will be able to download new knowledge and skills. The role of work will be to create knowledge of all kinds, from music and art to math and science. The role of play will also be to create knowledge. In the future, there won’t be a clear distinction between work and play. 
Of the three revolutions the most profound will be robotics, or strong AI.  The Turing test will come and go, computers will begin modifying their software to make themselves smarter, leaving even geeks in the dust, and by the “end of this century, computational or mechanical intelligence will be trillions of trillions of times more powerful than unaided human brain power.”  

We will then infuse the matter and energy of the universe with nonbiological intelligence, causing it to “wake up.” But this will take awhile, unless there's a way to exceed or circumvent the speed of light.

Conclusion

How do we know we will continue expanding at an exponential rate?  

We don’t.  If we sit back and let it happen, it won’t happen.  But given the realities of the world the trend is just about unshakable.  All the wars of the 20th century, the Great Depression, the Cold War, the recent recession — none of it disrupted the exponential progression of technology.  On a project by project level, we obviously can’t make firm predictions, Kurzweil points out.  Fifteen years ago it was clear search engines were coming but we didn’t know which one would prevail.  Which ideas will win out is not known, either.  But the overall trend has been remarkably predictable.  As Kurzweil writes, “We would have to repeal capitalism and every vestige of economic competition to stop this progression.” (Kindle 1647-1648)

The downsides to technology are well-known, and it cannot advance without posing a threat.  There will always be psychopaths and many of them are enthusiastically voted into political office.   Eric Drexler, the father of modern nanotechnology, issues this warning:
The coming breakthroughs will confront states with new pressures and opportunities, encouraging sharp changes in how states behave.  This naturally gives cause for concern.  States have, historically, excelled at slaughter and oppression. (p. 175)
Fortunately, the exponential favors the individual, especially young people who are eager to embrace new technology.  States, as monuments of bureaucracy and incompetence, are overwhelmed by rapid change.  These considerations, in combination with the decentralizing and deflationary aspects of information technology, may ultimately relegate states and their Keynesian priests to the ash bin of history.