There are many reasons to be pessimistic. The economy continues to limp sideways, although limping is an improvement since the crash of 2008. Unemployment remains stubborn — not budging from 7.6 percent following Friday’s jobs report. Wages remain more or less stagnant. According to a study from the Urban Institute, Millennials may well be the first generation to live lives inferior to those of their parents. There seems to be plenty of fuel for the belief that the sun has finally set on U.S. prosperity, a setting reminiscent of the one over the British Empire in the 20th century.
Yes, times are still tough. But pessimism is not justified. The U.S. stands on the cusp of a dramatic revival and rejuvenation—propelled by an amazing wave of technological innovation.
A slew of breakthroughs are beginning to deliver the productivity gains and cost savings needed to sustain economic growth and prosperity. These breakthroughs, mostly digital in nature, will complete the shift begun by the Internet to a new era, one where the precepts of Moore’s Law can be applied to virtually any field. Anything that can be digitized will be digitized. In this future, drug development and medical device production will be personalized, cheap and fast.
Computer-assisted design and fabrication will reshape manufacturing forever. These technologies will slash waste and replace nearly all conventional manufacturing with more environmentally friendly and cost-effective additive manufacturing run with robots and computer programs. Complex systems resistant to modeling will succumb to advances in Big Data that allow mankind to finally make sense and improve upon the most intricate multi-faceted interactions. Where Big Data fails, ubiquitous crowd sourcing will harness untapped brain cycles to train systems and solve problems, one small activity at a time – on a global scale.
With 3D design and printing, expect to see acceleration in research and development for nearly everything — from airline design and online advertising to artificial organ construction. This will, in turn, allow for far more rigorous testing of products and processes. Dirt-cheap digital delivery platforms for educational content and improvements in the understanding of the way the brain learns will yield a sea change in how we gain knowledge. This will result in more open, flexible educational systems and structures – and a smarter, more learned and constantly learning populace.
In the field of energy, even as Silicon Valley has turned cold on green startups, the cost-per-watt of solar and wind energy continues to fall. GTM Research computes that the average price of solar panels per watt has already dropped by 97.2 percent between 1975 and 2012. Renewables are already undercutting old carbon-based power generation in swathes of the country — such as Hawaii and California — where electricity is costly.
Already, we’ve seen how fracking technologies have caused a dramatic increase in the amount of oil and gas that the US produces. In turn, this has driven a new wave of construction of high-efficiency steel and chemical plants along the Gulf Coast of the U.S., close to shipping lanes and benefitting from cheap natural gas or electricity. Energy efficiency technologies, such as LED light bulbs, improved heating and cooling systems, and Internet-enabled hardware such as the Nest thermostat, can save enough money to offset the initial cost – often within a year or less.
The implications of these shifts are tremendous. Manufacturing in this country will rebound. In fact, multinationals are starting to re-shore manufacturing jobs to the United States. The economies of scale that benefitted cheap labor and cheap locations overseas will be stood on their head as automation and mechanization drive down the share of manufacturing costs attributed to labor. Advances in tablet computers and learning technologies will make learning more fun and allow people to learn more, faster. Health care costs will fall dramatically as the old doctor’s office centric and one-size-fits-many treatment approaches give way to truly personalized medicine. Connected hardware – cars, thermostats, cell phones, pacemakers, appliances, heating and cooling systems – will supply an endless stream of useful data that will allow us to optimize for efficiency and live more comfortable lives.
Because the U.S. continues to lead the world in its ability to adapt to, incorporate and develop new systems and new technologies, we are uniquely poised to reap a disproportionate share of the benefits of these shifts. Even better, these advances will remedy the very weaknesses that have straightjacketed the U.S. economy and confined economic growth to the upper classes.
Yes, many things can go wrong. Wars, terror attacks, and natural disasters may cause major setbacks. But I am optimistic that we will get beyond these. My prediction is that by the end of this decade, we will begin debating how to distribute the prosperity that we are creating and how we can uplift mankind.
Vivek Wadhwa is Vice President of Innovation and Research at Singularity University and Arthur & Toni Rembe Rock Center for Corporate Governance at Stanford University. His other academic appointments include Harvard, Duke and Emory Universities as well as the University of California Berkeley.