Technology and Innovation, an Interesting WSJ Article

Although the thoughts and flow are a bit disjointed, I found the following WSJ article interesting:

Jenkins Jr. Holman W., 2010. Technology = salvation. The Wall Street Journal, Oct. 9.

The article is an interview with Peter Thiel, a venture capitalist who holds a financial position in Facebook.

Since around 2002, I have been concerned that ultra low interest rates did not create a large number of new businesses. Of course the speculative mania of the .com boom, and subsequent crash, probably damped many hopes for technology start-ups. The great shift in the economy starting in 2002 was toward housing and related industries. My view is that housing crippled American beyond the economic bubble that burst in 2008. The growth in the housing market took resources away from innovation, an important aspect of future economic growth.

I wrote this blog post back in Jul. about my concern regarding start-up financing:

Venture Capital Depression

The drastic drop in venture capital has specific causes.

The entire activity of creating new technologies is dominated by starts and stops, an all-out effort, and failures. Success is not frequent.

However, I think success must always be the goal. In some situations that I have been involved, I was not sure that there was an all-out commitment to success. There was more interest in getting money. This is a concerning trend.

As well, several technologies have not panned-out. This quote from the article mentions a few:

"People don't want to believe that technology is broken. . . . Pharmaceuticals, robotics, artificial intelligence, nanotechnology—all these areas where the progress has been a lot more limited than people think. And the question is why."

This lack of success has long-term effects. For America to remain strong, this situation must turn-around. My basic approach is to always make new technology successful through the accurate and comprehensive assessment of its potential and limitations.

Mr. Thiel does mention that some recent technology appears to be highly successful:

"The great exception is information technology, whose rapid advance is no fluke: 'So far computers and the Internet have been the one sector immune from excessive regulation.'"

In general, I think we need to take an honest and intense appraisal as to why some technologies are not successful in practice. This needs to be part of the University.