At this time of year when people are making predictions on what the next 12 months will bring, it’s instructive to look back at what people were predicting a few decades ago.
In The Case for Optimism, entrepreneur Fabrice Grinda writes:
Let me take you back in time to the late 1970s for they seemed to mark the beginning of the end of Western Civilization. OECD countries were suffering from stagflation with inflation and unemployment above 10%. We had suffered from 2 oil shocks. The US had lost Vietnam. The Shah had fallen in Iran. The Soviet Union had invaded Afghanistan. Dictatorships were the norm in Eastern Europe, South East Asia, Latin America and even Southern Europe. The Club of Rome had made dire predictions that the world would run out of oil, coal and many natural resources within 40 years.
No one predicted that over the next 40 years there would be democracies across Latin America, Eastern Europe and Southern Europe; that inflation and unemployment would fall dramatically; that we would see the greatest creation of wealth in the history of humanity as 1 billion people came out of poverty. 650 million came out of poverty in China alone, completely changing urban landscapes across the country as a whole. Despite 40 years of record consumption of oil and natural gas we now have more reserves than we did then. The way we work and live has been profoundly transformed by computers, the Internet and mobile phones.
If we take a further step back, we can see that over the last 100 years economic downturns, be they recessions that occur every few years or bigger crisis such as the great depression, as painful as they are while we live them, barely register in a background of unabated economic growth. In fact over the last 100 years human lifespans have doubled from 40 to 80, average per capita income has tripled and childhood mortality has divided by 10. The cost of food, electricity, transportation and communications have dropped 10 to a 1,000 fold. Global literacy has gone from 25% to over 80% in the last 130 years.
We have redefined what poverty means. Today 99% of Americans in poverty have electricity, water, toilet and refrigerator. 95% have a television. 88% have a mobile phone. 70% have a car and air conditioning. The richest people 100 years ago could only dream of such luxuries.
We are also living in the most peaceful time in human history; not just of recent history, but in the history of humanity. We are truly living in extraordinary times. . .
He goes on to look at improvements in technology, health, public service, education , transportation, communication and energy and concludes:
. . . Think about it. Computing power was so expensive we had to limit access to it. Now it’s so ubiquitous we use it to play Angry Birds or check Facebook. Its very cheapness has unleashed an extraordinary wave of innovation.
The same will happen with energy. Once it’s cheap many of our other problems go away. The idea that we will face a fresh water shortage is also ludicrous. The earth is 70% covered by water. The issue is once again accessibility as only 1.3% of it is surface fresh water. However in a world of unlimited energy it’s easy to desalinate salt water. In fact we may not even need to wait that long as new innovative devices like the Slingshot are coming on stream that can generate 1,000 liters of pure water per day from any water source, even saline or polluted.
Once fresh water is abundant food also becomes abundant as you can grow crops in the dessert – and that’s not taking into consideration an agriculture productivity revolution that could come from urban vertical farms.
As people we are truly blessed to be living in this amazing time. As entrepreneurs and investors we have the privilege of helping create this better world of tomorrow, a world of equality of opportunity and of plenty.
Closer to home, Lindsay Mitchell notes 10 positive trends in New Zealand: Assaults in police, incidents of sudden infant death, recorded crime, smoking, abortion, teenage pregnancies, road deaths, child mortality, Maori suicide and rheumatic fever have all declined.
Of course there are still major problems at home and abroad but both writers provide strong cases for optimism.