On these pages, I have cast a rather skeptical eye on all matters financial. I have mocked the housing recovery calls, critiqued the valuation of Facebook, despised the robo-signing settlement, urged caution on the Black Friday retail hype. The silliness coming out of Wall Street is much like a carnival barker urging us to play one more of “games of skill.” All of which goes to say I am not your run-of-the-mill perma-bull or economic cheerleader. Readers, in fact, have called me a curmudgeon.
And yet, as I look to the long term, I’m optimistic.
Part of my misspent youth involved a fascination with dinosaurs and astronomy. The vastness of space was unfathomable, the millennia across which the dinosaurs ruled unimaginable. At least, until I learned exponential functions in algebra, which gives you a framework for dealing with all those zeros.
Hence, one learns to think in different time frames, including very long geological epochs and astronomical eons. The Triassic period is replaced by the Jurassic, which in turn is replaced by the Cretacious, and so on. This is important, not just because it helps to understand the long cycles, but also because it helps to grasp crowd psychology.
You see, there is a natural order of things, with the old replaced by the new, the more efficient displacing the less. The steam engine lost out to the internal combustion engine; dinosaurs were replaced by the smaller, more adaptive mammals; and you, old man, are going to have your sorry behind replaced by kids brimming with ideas and energy.
This is a good thing.
Creative destruction can be wrenching — whether in technology, economics or evolutionary biology.
The economic upheaval of recent years has led people to feel oppressed and frightened about the future. And the public has plenty of legitimate concerns: People are fearful of losing their jobs, not interested in buying homes, uneasy about their long-term security.
The fools in our midst are those who make a living scaring the bejesus out of the rest of us. Nothing is ever a mere problem, it is imminent catastrophe. There are no simple issues, only Armageddon. Debating taxes is not about revenue and spending, it is about class warfare. Even a cyclical recession, something we have had nearly 20 times over the past century is sure to slide into a depression. It’s as if we now live in an ALL CAPS WORLD.
No wonder the crowd is suffering a malaise. In addition to the real fears, they have lots of fake ones hanging over their heads. After a Great Recession, this is to be expected. We had the rise of the End of Worlders and the Zombie Bears. They are best ignored.
I bring all of this up because I spent last weekend at a conference in San Diego checking out a run of start-ups. I had lunches and dinners with young entrepreneurs and techies and their angel funders.
The companies were impressive. Some were good, some were great, and more than a few were stunning. But this was not about any new hardware or app or gee-whiz technology. Beyond all that, I was truly taken with the entrepreneurs. Their ideas, energy, passion, competencies — all were just astounding. After seeing that, it’s impossible to be negative about our long-term prospects — and, yes, I see the valley ahead of us.
It is not merely about the ideas and the technology, but about the drivers of them. If you want to understand the future of America, if you want to grasp why we are not doomed, then you must spend some time with young entrepreneurs. Their creativity, business acumen and technological insights are uplifting, energizing, empowering. It’s fertile ground, not just in Silicon Valley but across the land: San Francisco, New York, Boston, Miami, Washington, San Diego, Denver, Atlanta. That is where economic growth will come from.
As the demands of life pile on, it’s easy to forget how much you wanted to change the world when you were young. You might be stuck in a job you don’t love, a too-big mortgage, demands of family . . . suddenly, we forget who we once were.
They still know. The youth of America don’t care that their parents screwed everything up — they are going to steamroll over the old order and replace it with one of their own (just like their parents were and theirs before).
A thing I have noticed about today’s youth: They have no illusion that any company will offer them much in the way of economic security. They have a firm grasp on the idea that they are a business of one — even if they work for IBM or Uncle Sam. They are their own team, a singular brand, their own idea factory.
These kids are not looking to Washington for help. They find political debates in this town laughable. Like two Tyrannosaurs debating who gets to devour the plant-eater, wholly unaware of the giant asteroid hurtling their way. You want to know how that argument got resolved? How does this argument get resolved? It gets settled by a giant asteroid.
The old order, the political hacks and hangers on, the whiners and recessionistas, and the permabears — these are the dinosaurs in our story — have no idea what is coming their way. They cannot see the asteroid hurtling their way from the deep black depths of space, so busy are they in pointless debates and parliamentary maneuvering.
The future of America is not being driven by Goldman Sachs or the GOP or President Obama. That’s old school, the old order and oh-so-yesterday.
The future is driven by people who are young enough that they still want to change the world. They have the ideas, the venture financing, the technical acumen and the creativity to push us forward. Based on what I have seen, the old regime will still be arguing while the new one steamrolls over it. Sure, the old order has the money and the power, but it has run out of time, vision and drive. That edge goes to the youth.
Don’t say you weren’t warned.