The Evolution of Technology

Industrial Development

An oft quoted myth about the superiority of Japanese and German industrial development is that, after the United States destroyed these countries' industrial bases in World War II, they built them back all new and shiny while the U.S. industrial assets grew old and decrepit. This long accepted statement of how things happened goes along with the old canard that war brings prosperity. Applicable to this historical situation are five ecological principles (not mythical in any way) that bear examining. What we learn from these five principles helps reveal the actual truth here.

First Things First

The first great principle of ecology (in two parts) is that (a) heredity— that which is inherited through the laws of genetics—determines the potential to which organisms, and hence communities, can develop, and (b) environment determines the extent to which that potential development can take place. If an organism can exist in only a narrow range of environmental conditions, it has a narrow ecological spectrum; if, on the other hand, the organism can survive and thrive in a wide range of environmental conditions, it has a wide ecological spectrum. Ecological spectrum relates closely to the distribution of species geographically.

The second great ecological principle is that of succession in which, progressively, one community of plants succeeds another until a stable configuration known as the climax develops. This is an often observed phenomenon in areas being newly colonized by plants.

The third principle has to do with how mature communities maintain themselves, and it can be called, quite simply, individual replacement. Once a community is mature, individual members of the community may grow old and die, may be come diseased and die, or may get struck by lightning and die. The individual niches that open up when these deaths occur are filled by individuals that just happen to be at the right place at the right time. It is a matter of chance as to what exact species will be the replacement, but it is no chance that the replacement will be a species in the succession of that community and will tend to the same life form. Trees replace trees in mature forest communities, while grasses replace grasses in mature prairie communities

A fourth principle of ecology says that a certain range of different species can, with equal success, occupy the same environmental niche. This may be stated another way: For the purposes of replacement, a number of species may be ecotypically interchangeble. The species comprising the dominants of a community can interchangeably replace themselves, for instance.

A fifth ecological principle states that when, a mature community is destroyed, (say, by fire or hurricane), the replacement community goes through a very abbreviated successional development. Rather quickly it gets back to being a climax community. In nature this results when certain factors present during the catastrophe, such as soil during a forest fire, are preserved rather than destroyed. These factors then can accelerate the development of the community as they don't have to be formed anew. Propagules (e.g., seeds, buds, or shoots) of the dominants may also be abundant after the calamity.

Lastly, we must add that we have to remember that ecosystems are energy absorption, translation, and transformation systems. Green plants, using the simplest raw materials of water, carbon dioxide, and sunlight as the energy source, make sugars. Sugars are the starting compounds for all the other compounds of biological organisms. The process of photosynthesis is termed primary productivity, as it provides the basic inputs into all other biological processes and is the starting point for the formation of all biological structures organisms, etc.

Keeping in mind these five principles of ecology, we now switch from natural ecosystems to technological ecosystems and what seem to be the latters' processes that are counterparts to natural ecosystems' processes.

The Story of Civilization

In technological ecosystems, several basic processes come together to provide the energy and materials to construct the systems. Basic to any development in technological ecosystems is power and, in our simplest forms, humans and animals provide the power. For examples, in the past, women provided the power for the agricultural revolution, and at a different time in history, humans provided the power to build the pyramids. The story of civilization is the story of the development of power and its application to work in agriculture, manufacturing, etc.

The extractive industries are the most basic in technological ecosystems as they provide the raw materials for all other processes. Agriculture in this context is an extractive industry, as it provides food, feed, and fiber for our industrialized world. Above the extractive level are manufacturing and trade. And permeating the whole of extractive, manufacturing, and trade processes is the financial world that provides the capital for the various enterprises, sustains their inventories, and provides their profits. It is obvious that all the parts of this system have to be integrated for the modern industrial society to operate.

Let me mention here that there is another destructive myth afoot these days. It is that the U.S. is a post-industrial society. This false notion accompanies a great obsession with the free market. Both are espoused by some of the same people who allowed the Japanese to ravage the U.S. electronics, machine tool, and auto industries. According to this myth, post-industrial society is supposed to be a service industry society, and manufacturing is supposed to be passé.

Japan, as a modern industrial society, is far from being a service industry nation. It is a cartelist, merchantilist, trading nation. Its factories spew myriad goods for the world market. Its financial institutions are the largest in the world and it dominates most of the markets it enters. Are the mythmakers telling us that the United States is over the hill and our place in the sun is being taken by Japan? Or are they telling us that we are going on to higher things and Japan gets stuck with the dirty work of making everything and getting all the money? Either way, the myth is destructive because it has been held by people who have administered our Federal policy, and who could, and did, let the Japanese run rampant in our markets doing much damage to United States' business and industry, by practices that are contrary to our own law. Whether this will continue under Clinton remains to be seen. Regardless, manufacturing is the primary productivity of the modern industrial society. There is no other successful modern society.

Human Genetics

Genetics is the bedrock information system for ecosystems, both natural and technological. Because is true, the term ecosystem, when it pertains to either the natural or technological, is meaningless without the genetic component. As humans produce the technological ecosystems in which they reside, the environments of such ecosystems have to be compatible with human genetics or the question is moot.

Historically, there has been succession in technological communities as well as in natural communities. These communities have moved from hunting and gathering to farming, and then through various stages of urbanization, from the small village to the great metropolis. An example is the site of the city of London, which has been continuously occupied from the Stone Age to the present with a succession from Stone age flint technology to modern engineering. Wherever one of these successional forms now exists it has persisted for a very longtime. This is true not only of London, but of Paris, Rome, Istanbul, Mexico City, and many other places. Rather than new cities being built, for the most part, accretion has occurred around or on top of established cities.

As technological communities are built from plans, any technological community can be converted to an other form through engineering practice. Educational systems prepare human technotypes to perform the functions of the technological ecosystem. That is, the education system produces the technotypes necessary to build and maintain the technological ecosystem that is, the city.

Replacement of the parts of mature technological ecosystems also occurs on an individual replacement basis. As parts of manufacturing facilities become obsolete, they are replaced by up-to-date versions or with new works,. Every so often automobiles need engines that differ from past production models. The work is projected for the future and the old engine plants continue to operate while new engine plants are built.

Similarly, most industries must have a reliable source of skilled labor, at the blue collar level as well as at the administrative and managerial levels. Wherever workers—at any of the levels—are skills oriented instead of product oriented, they can work in any number of different facilities that use the same skills. Tool and die makers, for instance, can work in any industry that uses tools and dies—in auto and aircraft plants, or in assembling of products of all sorts. In other words, in technological ecosystems we find biotypic interchangeability. Anyone can be a butcher, baker, or candlestick maker.

In the broad scale of technological ecosystems, however, there is ecotypic interchangeability, a concept that refers to those functions that tend to maintain the city. Any range of industry can make such an interchange as long as there are markets for the products and a surplus of agricultural commodities to feed the factory/store workers.

Language Based Technology

The main difference between the biological community and the human technological community is that the biological community is developed on a molecular basis with genetic information while the technological community is developed macro-structurally by the engineering of, and with language-based information developed by, creatures—humans—who are genetically and technologically programmed. (These humans are genetically programmed to be Homo sapiens L., and technologically programmed to be engineers, carpenters, architects, plumbers, etc.) In every case, the genetic information of the natural ecosystem and the language-based information of the technological ecosystem interact with the physical, biotic, and edaphic factors of the environment to produce the results we see and experience—perhaps a beech-maple ecosystem or the city of Detroit, Michigan.

Natural ecosystems have their own genetically driven dynamic. Succession and competition dynamically change the detailed composition of the ecosystem, driving it to "higher" and more efficient utilizations of energy. The climax types for various ecosystems represent the integration of the genetic information present with the extant factors of the environment. Genetics and environment are inextricably locked. If this were not so the concept of ecosystem would be nonsense.

Biological change that occurs in natural systems is produced by the genetic code (usually extreme in its conservation of itself) experiencing an occasional random mutation coupled with competition. However change in natural systems may also occur when there are changes in the physical environment—terrestrial climate changes, heating and cooling of the oceans, changes in salinity, etc—that cause the organisms present to migrate or die, thereby allowing the invasion of the area by hitherto non-competitive species. Change in technological ecosystems is driven almost exclusively by language-based technology, and in both the short and long run is under the control of humans—perhaps not always under conscious control, but under human control nonetheless.

Is Tokyo Next?

The Kondratiev Cycle is supposed to be a long-term business cycle corresponding to technology obsolescence. The cycle is set at 55 years and is supposed to describe the ups and downs of business due to new technology and its decreasing usefulness as times goes by. I used this concept to describe the historical shifts of economic power that have occurred from Constantinople to and through Venice, Lisbon, Amsterdam, and London, and most recently to New York. Then I asked the question. "Is Tokyo next?" in The Road from Constantinople, We the People, June 1987, vol 2 No. 3.

Historically, economists and social scientists have attempted to find laws of society that correspond to the physical laws. The idea was that some Newton or Kepler of social science might come along and define the laws of society, which would provide for prediction and control of society. The fields of economies and sociology came into existence on these premises. Except for short term poll taking, no real laws of society comparable to the physical laws have come along. It would be more likely, it seems, that society would conform to the laws of ecology, if ecology, had laws. However, as ecology has no laws but only principles, we will have to relate these principles to sociology, psychology, and anthropology to infer the dynamics of the technological ecosystems.

In the case of the business cycle, or more specifically, in the problem posed at the beginning of this piece, we will have to look for reasons other than war and its aftermath to understand the superiority of Japanese and German industry over United States industry in the post-World War II environment.

The United States came out of World War II owning the world. The industry of Europe was in a shambles. The industry of Japan was destroyed. Nowhere in the world, except in the United States, was there intact, viable business and industry. The demand for goods was high and the supply of goods was short. The Marshall Plan put money and commodities in the hands of the people who needed them, and the reconstruction of the industrial world was at hand. During World War II, 50,000 men worked in the Edgar Thompson Works of the United States Steel Corporation in North Braddock, PA. Everywhere one looked one saw the same picture: labor intensive industry. Airplanes and automobiles were put together by hand.

Automatic controls and automation did not spring up out of the ground, or fall out of the skies. Automatic controls preceded automation by a generation or so. The steel industry became obsolete in the United States primarily because it was abandoned by its owners. The new processes were around, it's true, but the people in Germ any and Japan weren't doing new things without the knowledge of their American counterparts. The American counterparts simply didn't care.

When the U.S. steel industry was making a killing after World War II, U.S. Steel diversified into chemicals and oil. Failing to invest in its core business, U.S. Steel soon found it was way behind its competitors. The reasons were not the forces of nature or the action of unseen hands; the reasons were the results of decisions made by flesh-and-blood people who abandoned this basic industry to the Japanese and Germans (actually, the Europeans, for we also bought a lot of steel from England). U.S. assembly industries failed to accept the findings of research on quality. The Japanese accepted them and crashed ahead. General Motors put an assembly plant in California under joint ownership with Toyota in order to watch the Japanese management system operate. The plant was not automated, in the modern sense, but it had an assembly line. This California plant became the most successful one in the GM system, beating out in productivity fully automated GM plants without the Japanese management system. It took more than ten years and required a completely new line of cars, the Saturn, with completely new assembly plants to incorporate the Japanese management concepts. Why did it take so long? The corporate culture of GM was too set in its ways to apply to any of its existing plants the Japanese management system's principles it had discerned. GM is now talking about "Saturnizing" all its assembly plants. Meanwhile, it is shutting down plants that cannot compete.

The U.S. consumer electronics industry also took a big hit from Japan after World War II. However, it seems that in this case the Japanese had a big assist from the U.S. which appears to have gone out of its way to accommodate the Japanese trashing of this U.S. industry. This assistance came mainly from the U.S. Trade Negotiator, the U.S. Commerce Department, and the Office of the President, none of which chose to enforce the U.S. trade and commerce laws with the Japanese. With impunity the Japanese 'dumped' electronic products in the U.S. with little or no penalty, and when the U.S. companies bled to death, the Japanese bought the empty shells—a practice for which American businessmen would have gone to jail because of the violation of our anti-trust laws. Again, we have actions of our own people whose conscious decisions determined the outcome of events.

In the early days of semiconductor trade, when the U.S. had a virtual monopoly on chips of all kinds, the trade with Japan was contingent upon sharing the technology with Japan. The semiconductor companies demurred, but the U.S. Government insisted. The story of Japanese explosion in this industry with its consequent domination of the world markets for chips is now known all too well. Again, it is not the work of some unseen hand or some strange or esoteric economic law in operation. The U.S. Government promoted the Japanese takeover of the U.S. domestic electronics industry.

USX is Making Steel

Today, the steel industry is making some sort of comeback. At the least, USX, the U.S. Steel subsidiary for making steel, is profitable. Auto companies are fighting back, but they are not yet out of the woods; and the U.S. electronics industry is still trying to get up on its knees, it's not yet on its feet.

The number of former U.S. Government employees who obtained employment with the Japanese after their terms of office expired in the Trade Negotiator's Office, the U.S. Commerce Department, the U.S. Treasury, and the Office of the President is legion. The practice is so widespread that President Bill Clinton is requiring his cabinet level appointees to sign a pledge that they will not work for a foreign government after their Federal appointment for five years. This certainly indicates the severity of the recent abuses of power and position that have undermined the United States' trade position.

In the normal course of industrial development, the process has all the ecological hallmarks. The native intelligence of the innovators is primary. Without good ideas industry goes nowhere. Once established broad industrial communities exhibit succession as extraction industries are replaced at the top level by fabrication industries, and finally both types of industry are expressed as paper as they support the financial industry. NONE of these activities can be abandoned without consequences, and the nation that does abandon basic extraction and fabrication for financial services alone becomes vulnerable to manipulation. The United States is now being grossly manipulated by Japan at all levels of the society.

Inasmuch as Japan is the manufacturing powerhouse of the world today, she also has the money. Japan is financing roughly one third of the U.S. national debt. She is making inroads into our research and development institutions and our educational institutions. Japan has a great stake in the U.S. entertainment industry and can be expected, for the benefit of Japan, to exert very tight reins on the portion of the industry she controls. Through Nintendo alone, Japan has an 85% market share of children's electronic toys, and by intimidating U.S. toy distributors is keeping American manufacturers out of the market.

The Cartelist, Monopolist Japanese

Let's look at one example of Japanese maneuvering more closely. Many American users of electronic components, such as users of flat screens for portable computers, prefer the Japanese product over American products for one simple reason: although the technology is the same, the products are cheaper. The reason for this cheapness in the U.S. is that the flat screens are being dumped while the Japanese gain market share. (U.S. manufacturers, such as IBM and Apple Computer, testified against the U.S. maker of flat screens because the Japanese-industrial giant supplies cheaper ones.) The scenario, if it follows the usual Japanese path, is that the screens will be cheaper until the Japanese gain control of the market, at which time the price will rise at the whim of the Japanese. The supply will never interfere with a similar product coming from Japan—typical monopoly process. Ecologically, monopoly is the enemy of competition, free enterprise, and whatever exists of free markets. Monopoly is anti-democratic and epitomizes greed and selfishness coupled with authoritarian power.

To allow the full play of ecological factors in our industrial and manufacturing development, we Americans first have to realize what constitute ecologic-economic forces (i.e., market forces) and what constitute manipulations, when worked either by people or governments. We then have to decide whether or not our manufacturing/industrial bases have any purpose in our society, or whether they' are there just for the convenience of the owners and managers. Are the consumers a disembodiment of the work force? That is, is there any relationship between the people who work in industry and manufacturing and those who buy the products? Is the industrial and manufacturing base a part of our national interest? We then have to couple the so-called "free market" with free enterprise. Actually, the "free" market is yet another myth. The market is far too susceptible to manipulation to be free. And if the market really and truly free, it would tend toward monopolies—creations that are indeed undesirable as they have to do with the whims of their not the economy or well being of nations. A free market has no rules; it is capitalism with the face a brute.

Humanizing the free market necessitates its couplings with free enterprise. As practiced in the United States, free enterprise has rules, the most notable of which are the anti-trust laws. From this base, the rules move to those governing human health, human safety, the environment, and product liability. Free enterprise permits anyone to go into business. The recipe for democratic economics—is free enterprise with free markets, private property complemented by public property (the property of the sovereign), and fair taxes. As most new jobs arise in small businesses, (those with fewer than 50 employees), it is very much in our national interest to foster free enterprise. The U.S. entrepreneur with the flat computer screen was a small businessman going up against the monster electronic companies of Japan. In Japan he would have been swallowed into a keritsu without movement of anyone's adam's apple. If our laws do not protect a small businessman from the clutches of big business, our nation as the land of the free and the home of the brave is a cruel joke. The ecological term to describe Japanese business practice in the United States is predatory. However, we need to question whether we should blame the Japanese for their predatory actions when the United States Government provides assistance for (or, one might say, aids and abets) their behavior.

Free Market and Free Enteprise

The free market, when and only when coupled with free enterprise, means anyone can play. To ensure this, the Federal Government must intervene to see that this coupling not only can but does happen. The Federal Government in particular has to beat the forefront of the funding of research and development, primarily that which is academic, but also that which is industrial. We need industrial research at the Federal level so it can ride in tandem with our agricultural research, which has made the U.S. the preeminent farm producer in the world.

The Federal Government has to fund research and development as the mechanism of providing participation for all the citizens sovereign in the process of sharing the increasing new wealth. Education—as much of it as desired—has to be made freely available to all who want it, and without restriction. Not even failure in school should be an across-the-board deterrent to someone getting more education.

The Department of Commerce's support for small businesses must increase and diversify. This Department also would do well to establish an extension service whose representatives, working out of the engineering and business extension departments of every land grant university in our nation, would operate in every county in the nation. Management of such a program could be carried out by the land grant universities for the Department of Commerce.

Research funding should obviously be made available to university researchers, but it should also be made available to those with ideas who need financial backing for development. The Commerce Department needs an inventor's grant program administered by inventors (patent holders) not academics, the university professors who merely teach the pertinent subjects. One object of our nation's efforts in the manufacturing/industrial/business sectors of our economy should be to turn loose as many bright people as possible to innovate and create the products and businesses, needed to run and support the country at a middle class standard of living. (Who knows what innovative potential lies in the vast amount of genetic material we have afoot in the nation or, how many good ideas are possible and feasible for development if everyone is thinking about good ideas and showing how they can be developed into products?)

Additionally, our defense establishment, and our business and manufacturing establishments should participate with the Federal Departments of Defense and Commerce to establish national interest industries which would get priority treatment from our Federal agencies. We should not rely on the market to tell us what is in our national interest. We should determine, at least in part, what is in our national interest and then develop the market for those things.

With a level playing field, ecological principles will be discernible. We will be able to see the effects of individual replacement or ecotypic interchangeability as we try to determine whether any industry is in the process of maturing, is mature, or is in some-successional stage.

The Fall of the Giants

Two industrial giants—Xerox and IBM—that could have profited immensely had they possessed the wisdom to understand the processes they had unleashed, have benefited only marginally from the revolutions they started. The reason? The management of each was rooted to the past without an understanding of the dynamics of ecological change.

Xerox invented the personal computer at their Palo Alto Research Center. The dinosaurs who ran the company were fixated on electro-mechanical copiers, the market they dominated. But time doesn't stand still, and two things happened. First, the Japanese nearly wiped them out in their mainline business, leaving them high and dry, so to speak. Secondly, the company let some of its employees walk out the door with the fruits of Xerox research: the PC that became Apple Computer, the typesetting software that became Adobe, the mouse, and the pc network. There may be more of these of which I am not aware.

IBM conceived a brilliant strategy to bring to market the first truly universal personal computer, the IBM PC. It did this by assembling off-the-shelf components with an open architecture, inviting third party vendors to supply add-on boards for the machine. IBM had to ask Bill Gates twice to provide them with an operating system for the machine. Bill Gates went to Seattle Computing, bought an operating system for a reputed $50,000, and licensed it to IBM. IBM was fixated with hardware; after all, they had some of the finest hardware in the universe. What they failed to comprehend was the magnitude of the PC market and the relationship between hardware and software. The hardware makers eventually figured out the gimmicks IBM put in the PC to make it unique and duplicated them. The clone makers went full bore, reducing IBM in the PC market as just another clone maker of their own product. To add insult to injury, massive, parallel computers fabricated with cheap PC main chips are apt to put, both mainframes and supercomputers in jeopardy. Meanwhile, Bill Gates has a lock on the PC operating system to his greater glory and the greater glory of Microsoft. In the case of both IBM and Xerox, small business saw the potential of the technology and profited handsomely. Steven Jobs and Steve Wozniak in a garage making Apples, and Bill Gates with a supposed 50K investment in PC/Ms DOS could hardly be considered big in any sense.

I don't know if the developments in the computer industry would have been transparent to ecologists, but one thing is sure: what the PC is doing to our life is affecting it in meaningful ecological ways. The PC is the main driver of the information revolution and already has permanently altered the way the world does business and the way people live and think.

Genetics and environment, succession, ecotypic interchangeability, individual replacement, secondary succession, and primary productivity are all biological/ecological terms that can be used to describe business and industry. Thinking about industrial development will not only enable us to think about the environmental impacts of business and industry but will allow us to understand some of the relationships among businesses and industries as well.

It is easy to say that the United States got behind because Germany and Japan had the opportunity to build their industries anew while the United in States had to struggle with obsolete plant and equipment. That's an easy explanation but not the correct one. U.S. industrial managers and planners, the folks who live in the upper atmosphere of income levels, chose to spend the money for things other than new plants and equipment. They had the money, but they either did not have the vision or the will or they lacked both. There is no explanation for the nipponophiles in the Federal Government. Have the Japanese been THAT successful at ex post facto bribing of U.S. officials? Do these U.S officials want to see the United States as a pastoral nation raising the beef necessary to make Big Macs so MacDonald's can hire the next generation? It is pretty obvious that these U.S. officials violated the oath of office they took when they swore to serve.

Economics Will Never be Real Science

The reason economics will never be a real science is that economics past can be manipulated too easily by presidents, magnates, central bankers, junk bond dealers, and the like. The reasons for our prosperities or our depressions are always, at least in large part, the result of conscious decisions; they are not the result of entirely independent, random, and normally distributed events. Its another form of an ecological decision system, one in which we as individuals have great interest, since in large measure it influences what equity we have in our technological ecosystem. To obtain our equity we have to know how the system works, how it can be manipulated politically and do what we can to preserve the fairness and equity in it. At the present moment, it seems, we could get the most reform for the buck by regulating campaign financing. Buying politicians seems to be adding quite a bit of distortion to our system. Attending to the fairness and equity in the human technological system, we call the American republic, is a main part of the job of the citizens sovereign.

...Ted Sudia...

© Copyright 1993
Institute for domestic Tranquility