In the 1970s, biologists celebrated a major breakthrough: The discovery of so-called restriction enzymes enabled them to perform “gene transplantations”. It was the birth of gene technology. Artificial genes produce certain proteins that can then be used to treat respective human diseases. With this form of “genetic engineering,” the biosciences suddenly aroused the imagination and […]
In the 1970s, biologists celebrated a major breakthrough: The discovery of so-called restriction enzymes enabled them to perform “gene transplantations”. It was the birth of gene technology. Artificial genes produce certain proteins that can then be used to treat respective human diseases. With this form of “genetic engineering,” the biosciences suddenly aroused the imagination and interest of entrepreneurs. A pioneer of this development was molecular biology Herbert Boyer who in 1976 met with manager and financial investor Robert Swanson to explain his findings. The result of this conversation was Genentech, a joint company that would translate Boyer’s research into concrete medical products. As a location for their company they chose a place South of San Francisco, where time many new computer companies were springing up at the same. Only a few years later (1982) Genentech launched the first genetically engineered drug: insulin. In 1990 Swanson and Boyer sold their company for $ 2.1 billion to the Swiss pharmaceutical company Hoffmann-La Roche. This deal made Boyer the first science billionaire in history.
These days most “tech billionaires”, as they are known today, live in that very valley south of San Francisco where Genentech was born. Until the mid-20th century, this area was mainly farmland. Its advertising slogans “Valley of Heart’s Delight” referred to apricots and plums rather than high tech. In 1971, the journalist Don Hoefler of the “Electronic News” titled the approximately 2,000 square kilometer small valley in an essay as Silicon Valley, after the first companies of the still-young semiconductor industry had just settled there. Today it is home to many of the largest high-tech companies in the world.
Biotechnology, genetics, nutrition or health technologies, nano- or neurotechnologies, artificial intelligence, robotics, virtual reality, social media, traffic and automobile and traffic technologies, and of course digital technologies and the internet – the “Valley of Unlimited Possibilities”, as Silicon Valley is also called euphorically, is world leader in all these areas. A mix of science center, talent attractor, risk-prone entrepreneurship, and high-return seeking investors, like no other region in the world the “Valley” offers the world championship of technological feasibility.
In Silicon Valley, the future technology of mankind is forged. Nowhere else will visions become reality faster than here. So where else than in Silicon Valley can we learn more about the attitudes of creative people, scientists, engineers, business leaders, and entrepreneurs, and thus about the technological shaping of our future? The people there regard themselves as the global engine of progress – and the progress per se as good. And for their visions, billions and billions of dollars in their desperate search for attractive returns are available to seek out the next “trillion-dollar” technology.
One of the most important investors and entrepreneurs in Silicon Valley is Peter Thiel. Thiel is openly committed to libertarianism, arguably the most extreme version of a liberal market stance. The libertarian movement is committed to the partial or complete abolition of the state. Thiel himself even expressed the view that democracy and women’s’ voting rights harm the country, as they stand in the way of libertarianism and the passage of capitalism. Furthermore, Thiel is a confessed transhumanist. Transhumanists want to abolish death through science, e.g. by freezing the body, by using nanobots that constantly make cell repairs in our bodies, or by loading the entire contents of our brains onto a hard drive and thus enable us to continue to live digitally. Their ultimate goal is to provide people with higher physical and cognitive abilities through technology, possibly all the way to creating a “super human being”. Not surprisingly, Thiel also advocates that computers should develop a form of strong artificial intelligence that will potentially be far superior to humans.
Pioneer of both ideas, an upload of our brain to a hard drive and the singularity utopia of building a super-intelligence is another dazzling figure of Silicon Valley: Ray Kurzweil. Kurzweil is considered one of the leading, but also the most controversial futurologists. He is particularly interesting because he plays the role of a technological chief strategist at Google and can be regarded as the main initiator of Google’s entry into biotechnology.
Thiel and Kurzweil may seem eccentric, but they have great power. Kurzweil as chief strategist at Google and Thiel with his venture capital fund “Founders Fund” both invest significant sums of money in companies involved in biotechnology, robotics, digital technologies, and artificial intelligence. Another large part of his billions Thiel invests into organizations such as “Humanity Plus” (the worldwide union of transhumanists), Kurzweil’s “AI Think Tank” and his management training institution “Singularity University”, as well as the “DeepMind Artificial Intelligence Project” (now also part of Google). Ironically, he also invested in the company “Palantir”, which allows state authorities to process large amounts of their citizens’ data (he is the largest shareholder of this company and sees no contradiction to his libertarian views here). Parts of the Thiel-funded institutes are close to the neo-fascist “alt-right” movement in the US. This movement has set itself the goal to push for the superiority of the white race. Even though Thiel himself is not an “alt-right” supporter, one realizes how dangerous parts of his political program are. And his power is growing: Thiel strongly supported Donald Trump in the election campaign and now has great influence in the team of the US president.
An alliance of tech evangelists made up of entrepreneurs, politicians, and scientists is creating a new world. But those who stay outside in this process are us, the citizens. And while all of this is happening, on this side of the Atlantic we are still discussing the implications of “Industry 4.0”, a term “created” by the German federal government (it is rather unknown in English).
The high-tech industry of Silicon Valley and people like Peter Thiel show us that there are no more economic barriers any longer. Our life is threatened to be overturned within a few decades, maybe even years, the limits of the imaginable are repeatedly exceeded. But can the free market still adequately control these technological processes and revolutions? The answer is no. Unfortunately, the real circumstances of market-based processes do not correspond to the ideal picture of economic models that Thiel and others proclaim. Adam Smith and his disciples are mistaken in assuming that free markets automatically lead to optimal outcomes (such as wealth for all). What they do not have on their screens are five forces that prevent the “market equilibrium” advocated by economists from actually setting in as a socially acceptable state. In assessing the development of future technologies, it is of utmost importance to know and consider these forces.
• Cognitive biases: New technologies are always associated with particular interests, and – as we see in the case of Peter Thiel – ideologies.
• Information asymmetries: These open the door to manipulations. That smoking is unhealthy, most people knew as early as the 1980s. But which non-specialist (or even expert) can assess the implications of AI or the gene-scissors CRISPR today?
• Externalities: Private entrepreneurs and investors benefit to an excessive extent from new technologies and become multi-billionaires while the society as a whole bears the risks.
• Rent Seeking: Government regulatory efforts (for example, for personal privacy on the Internet) are prevented by appropriate lobbying.
• Unequal allocation of production goods: Production goods can be accumulated in the hands of a very few. In this respect especially new technologies have a great impact, as technologies are changing the economy, too. The new competitive reality of the internet platform economy is “the winner takes it all”. This creates an unprecedented economic power concentration. Once in the fields of social media (Facebook), Internet search (Google) or office software (Microsoft), a company has obtained a position of leadership, it quickly becomes a monopoly that is very difficult to break.
There is always a divergence of interest between companies and the general public. Should the return hunger of technology investors or the ideology of the transhumanists really decide on our all future? Already, instead of this being part of a democratic decision making process, corporations aim at designing the functioning principles of our society, e.g. when Facebook calls it its mission to “develop the social infrastructure that gives people the power to build a global community that works for all of us.”
We are about to set a fox to keep the geese.
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