Regulating Away Innovation
Government pretends it’s the cause of progress. Then it strangles innovation.
We know government understands that new technologies are important. The military invests in robots and traffic cops use radar guns. But when the rest of us use robots or fly drones, government gets eager to put rules in place before things get “out of control.”
When it’s hard to innovate in the U.S., innovation happens elsewhere. The Japanese already offer largely automated hotels. At the Henn-na (or “Weird”) Hotel, the front desk clerk is a robot dinosaur — popular with the kids. Another robot stores your luggage, and another takes you to your room.
This may sound like an expensive stunt, but the robot hotel is cheaper than others nearby — partly because it employs fewer people.
That alarms politicians who fear change. Whenever there’s been innovation, experts predict massive unemployment. They react to what they see. Fewer receptionists work at that Japanese hotel. Military robots will replace soldiers, and self-driving cars will take away delivery people’s jobs. Often politicians pass rules to stop this “job destruction.”
But the more efficiently we can do things, the more human energy is free to be turned toward the unseen, tasks we haven’t even thought of yet but which may be more pleasant to do, and these jobs will create new opportunities.
If we crushed every machine that did things humans used to do, we’d still be living in caves and hunting tigers with spears. Every time there’s a new invention, some people lose jobs, and there’s a period of adjustment.
But we come out ahead.
You don’t believe employment recovers? Remember that 200 years ago, 90 percent of Americans worked on farms. Now fewer than 2 percent do. But that doesn’t mean that 90 percent of the population has been left unemployed.
“We saw the car displacing horses, buggies and buggy whips, but we don’t lament that passage, do we?” says Max Borders, author of “Superwealth.”
“The blacksmiths of old had to figure out something else to do,” observes Borders. “They all found jobs. The economy evolves. It’s an evolving ecosystem.”
Some don’t want it to evolve. Cab drivers and their unions demand that government protect their jobs from competition by ride-hailing services such as Uber.
But if government stepped in to protect jobs, we’d be stuck with the jobs and industries of the past, millions of buggy-whip makers and all those extra farmers.
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