It is not truth [Faust] wants from his devils, but gold and guns and girls.
C. S. Lewis
New physical tools can trigger changes in our supplies of food, labor, materials, and energy. But so can new institutional tools—in governance, law, markets, trade deals, and such. Both kinds of tools might tie us into larger and denser networks, which might help us produce more, and thus support more of us, concentrate more of us, and make more of us richer. That happens partly because of ‘ecogenesis’ and ‘non-linearity.’ Ecogenesis is about how recursive reaction networks might build up in layers that depend on earlier layers. Non-linearity, though, is about why their resulting structure then makes their behavior so hard to predict. Both of those swarm-physics behaviors help explain why phase changes can happen. They can also help explain our settlement styles, our financial crashes, our attitudes to the future, and what might drive some of us from poverty to wealth in the near future.
It’s midsummer, about 1,200 years ago, toward evening. Armed men are pouring off longships and racing up the stony beach of a small islet off England’s northeast coast. They storm up the rocky crag toward a monastery surrounded by some huts. The surprised monks barricade their doors, praying for mercy. But the raiders murder their way in and grab gold, silver, and ivory crosses, candlesticks, and reliquaries. They also grab tapestries, embroidered altar cloths, cattle, food, and boys. They make their new slaves haul their loot back to their longships as they set fire to the place. Then they flee into the night.
That was the first Viking raid on England, in 793. For the next two and a half centuries Scandinavians plundered-and-ran while Saxons kept paying them bigger and bigger bribes to please stop. But they didn’t stop. They were “so strong with God’s consent, that in battle often one will put to flight ten.... And often ten or twelve, one after the other, will disgracefully insult the thegn’s wife, and sometimes his daughter, or near kinswoman, while he who considered himself proud and powerful and brave enough before that happened, looks on.”
Today, the English language still remembers that centuries-long onslaught. Many died as the scary, ugly, angry, ransacking berserkers hit, clubbed, hacked, and slaughtered their way in. All those English words, and many more, including the crux of the matter: they, want, and take, descend from Scandinavian words. A thousand years ago, the Vikings loosened bowels all over Europe. When they went shopping, might made right.
They weren’t the first to invade the island, nor were they to be the last. And while today their shopping style isn’t unheard of, it’s rare across most of the planet. Why?
Rewind history about 12,000 years. We’re now all back to being small bands of foragers. At this point in time, we’re probably all armed, but theft makes no sense. We’ve little to steal since everything we own must go on our sweaty backs. Even were we to steal, we’ve no place to keep the swag other than in our bellies. So were we to come across a lode of gold or silver, we couldn’t own it. That would mean having to settle there, and that we couldn’t do, or we would starve. We can’t eat gold. Further, in case of conflict, whether between bands or within a band, some of us could always run away.
Formal law and government also makes little sense. Our bands are small, and in them we’re mostly related, so we all know each other well. We also have no armies, and no slaves. Both would be pointless—and too costly. Genocide, too, likely is too costly. We know how to fight, and do, but what’s the point of trying to destroy another clan? It might sometimes make sense as a kind of insurance, or possibly, in really hard times, to make a meal. Otherwise though, why risk our lives? There’s always more land elsewhere. For us, the planet is like a big shopping mall with no cash registers. We roam from store to store, living off whatever happens to be there.
Now press the fast-forward button until 7,000 years zip by. Many of us around the planet have now phased changed into farmers or herders. We’re now so many that here and there we’ve formed cities. Around the globe we’ve now tamed horses, asses, camels, and such, so some of us can travel further and carry heavier loads. With ships, trade is growing and we’re about to invent writing.
But as we multiply, good farm land and good grazing land grows scarce. And with greater numbers and faster transport, in case of conflict we now have fewer places to run. Also, moving costs rise as our baggage rises. Further, we’re now working far harder than before, but we now have so much reliable food that about one in ten of us no longer has to farm or herd at all. Now when we come across a lode of gold or silver—which, later on, as Inca we’ll call Sweat of the Sun God and Tears of the Moon God—we can own it. So now earth’s mall has a new thing—landlords. Shops now have owners—armed owners—and cash registers.
Many of us now live together in dense clumps, but we no longer know each other well. So we invent formal laws and government. Theft now makes sense. For one thing, we have somewhere to put the swag. We amass armies and scratch any victories into huge stones for all to see. Slavery, too, now makes sense. Genocide also makes sense, because if we win a war we can follow with slavery and mass rape to gain both more land and more hands.
We had gone from pots to hold grain to potters to build pots, granaries to hold pots, masons to build granaries, soldiers to guard granaries, metal weapons for the soldiers, miners to fetch the metal, smiths to shape it, artists to decorate it, priests to bless it, raiders to steal it....
Just as the first animal species may have existed for millions of years before bothering to develop things like armor, teeth, and claws for defense and attack, preying on each other could now make more sense than preying on the planet alone. When things get tough at home, many men, instead of risking their lives to till barren soil or nurse dying sheep, might risk their lives to try to steal bread and meat and beer—and women to serve them. So even though to not go and not see is a good way to not be conquered, what Caesar would later say is what we would remember.
So swords spread, walls rise, bandits grow. Now we have armies and kings, tax collectors and historians, chariots and battering rams. Those are tools—military and political tools—just as plows and pots, and seeds and cows, are tools.
In our newly dense clumps, we use such tools for at least three reasons. First, within a clump, they stabilize who has what wealth, thus reducing internal conflict. Second, outside a clump, they protect our wealth from bandits (like the later Vikings), thus reducing external attack. Third, between clumps, they help our stronger clumps prey on our weaker clumps, thus increasing external conflict. So our clumps are now interested in two things above all—taking booty and seeking safety from other booty-takers. (And there would be no dearth of pious cover stories to sanctify all that.)
Further, in any particular clump, once the strongest among us have swords, they take everything else. A few of us thus tame, then cultivate, the rest of us—just as we had all earlier tamed, then cultivated, wild animals and plants. Those few then turn into lords and the rest of us turn into cattle with names. They then demand rents from us. And we pay, because not paying means whipping, exile, or even death.
Today we still have such rents, except that we call most of them ‘taxes.’ A tax is a cost we bear to get state services—including the service of not being whipped, exiled, or maybe even killed for not paying taxes. It works much the same way if the local power isn’t a state but a gang, except that we then call its rents ‘protection money.’ Sometimes the only real difference between a state and a gang is the uniforms. Yesterday’s bandits used footsore mercenaries and battering rams. Today’s use white-shoe lawyers with expensive suits and legal loopholes. But the game remains much the same.
In short, as we added to our toolboxes, whether physical or institutional, our groups cycled through a sequence of types of settlements and markets and governments affected by our available tools and our varying trade-and-raid choices.
Such a staged, layering process isn’t unique to us. Food webs change in similar ways. For example, if a fire, flood, landslide, volcano, meteor, or whatever, scars a piece of land, only a few kinds of life can invade the virgin terrain. If it’s a really bad scar, nothing can invade. But then come pioneers, like bacteria, algae, lichens, mosses, and such, which make soil. Then come annuals—like marigold, foxtail, and crabgrass. They go through their whole life cycle in one season. Their seeds are small and light, so they spread widely. Their roots stem erosion, and as they die, their bodies pile up, helping the soil retain moisture. Over the years, humus builds up.
The food web then changes. Biennials—like onion, garlic, and parsley—then perennials—like ferns and most grasses—can now invade. They live on the humus carpet as well as the raw soil below. They grow more slowly than annuals since they’re woodier and have bigger and more delicate seeds. (That’s why annuals outgrow them on raw soil.) But they also have deeper roots and more stored food. So over the years they outgrow many annuals. As they die, humus deepens, soil chemistry changes, retained moisture rises.
The food web can now support shrubs, which sprout. As they spread, they displace many perennials because they’re taller. Then as the soil weathers further, saplings can sprout. They grow even taller, so they shade out many shrubs. Trees then compete on height, shading out many other things. They further alter soil chemistry and water retention. They also alter local windiness. Now mushrooms, mosses, and epiphytes can invade, living in the moist, cool, still world that the trees have made. On and on the invasion cycle goes, with the mix of compatible survival strategies changing as each new species invades.
Each species has its own way of food-getting and baby-making. Some, like annuals, are catch-as-catch-can street dealers selling hot dogs or fake Rolexes. They travel light, so they can move fast and land anywhere; but they have no resources to see them through tough times. They’re like foragers. Some, like shrubs, are mom-and-pop grocery stores. They have a shop, so they’re more permanent; but they can still move, if needed. They’re like herders. Some, like trees, are staid bankers in colonnaded buildings. They have deep pockets—but they also need many depositors just to take root—and moving is hard. They’re like farmers. Brain surgeons, nuclear physicists, rocket scientists—none can get food or make babies without others to prey on. Nor can they exist at all without all those who came before and thus prepared the way for them without even meaning to.
Suites of such species that fit together end up food-getting and baby-making together. That may change the food web, which may shut out some old species and allow in some new ones. Thus, after trees sprout there’s space for mushrooms but no space for annuals. They can’t invade until the next fire, or flood, or landslide—or until lightning, a big storm, or a hard frost fells a tree, thus exposing raw soil at its roots. That patch of near virgin terrain will have its own microclimate, allowing annuals to come do business there—namely: get food and make babies. Similarly, bankers don’t want fly-by-night Rolex sellers outside their doors—it sends the wrong signal. But they lose control if there’s a run on the bank.
That network build-up happens not because anyone planned it, but because each species is different, yet they’re all linked to each other through the soil and the local microclimate, which they all both share and change.
Ecologists might call such a staged network build-up ecogenesis. (Although that’s a made-up word and they don’t use it; they use various technical phrases for similar ideas). That process isn’t the same as (genetic) evolution because no species has to change for it to happen. It’s like dealing hands of cards. Each card specifies one way to get food and make babies, and all the cards are already in the pack, ready to be dealt. It’s just a question of which card goes with which other cards to make suitable hands.
Even though each species might invade by chance—the wind blows a grass seed, a Blue Jay mislays an acorn—the resulting network isn’t random. That’s because whether an invading species can take root depends on what’s already there, which depends on what was previously there, and everything that’s there depends on everything else that’s there. So just as autocatalysis is a special case of synergy, stigmergy is a special case of ecogenesis. Stigmergy can be effected by one species, like termites, but ecogenesis can be effected by many species—marigold, fern, strawberry, elm, mistletoe, mushroom—or forager, herder, farmer, city slicker. They all change their shared food web, then react to those changes. An ecogenetic network thus acts on itself. It’s jointly self-assembling.
Our groups, too, can be self-assembling. Of course, we aren’t the same as other species since we can change how we get food and make babies, and our babies don’t necessarily have to grow up to get food and make babies the same way we did. So in that sense our groups can ‘evolve’ faster than our species can evolve. But there are similarities.
A thousand years ago, longships made the Norse wolves in the Saxon sheepfold. They were like annuals, blown south by the wind, invading any unprotected land that they happened across, whether that land was in what today is England, Scotland, Wales, Ireland, France, Italy, Sicily, Greenland, Iceland, or Russia. But, just as with plants, their raids then altered the food webs that they invaded.
Thus, in England the Saxons reacted to the Vikings by building hill forts and walled villages, much as the Romans had against the Saxons centuries before. Later, the Normans—French descendants of the same Vikings (Northmen or Norsemen)—built castles and taxed Saxons to support their mounted troops. After a while, the Vikings could no longer invade, so they quit—just as annuals don’t, or rather, can’t, invade a forest.
It’s much the same for our firms. While they could locate anywhere, they can’t find purchase everywhere. A village can’t support a Wal-Mart or a Tesco—there’s not enough humus. A small city can’t support a Bergdorf Goodman or a Harrods. A small country can’t support a Boeing or an Airbus—or a NASA or ESA. A single planet can’t support a... but we don’t yet know what that might be; we’re still a single planet.
In sum, not just steam engines and railroads and factories but also governments and stock exchanges and bond markets are the results of ecogenesis—the staged and stigmergic build-up of many recursive reaction networks. All our tools, whether physical or institutional, have together now made well over a billion of us rich. But we still live on a planet where many of our pets in rich countries get more food, medicine, and shelter than many of our babies in poor ones do, while we all look on, we who wish to consider ourselves proud and powerful and brave.
See. Want. Take.
Of all our institutional tools, a system of law might be the oldest; it helps keep our groups from falling apart. In Iraq about 4,000 years ago, a herdsman died before paying his taxes—a tub of butter and another of cheese. To cover his debt, the state enslaved his five kids. That was the law. Law is common among all our groups, perhaps because it’s usually cheaper than fighting all the time. Even the Norse a thousand years ago weren’t lawless, despite what the Saxon chroniclers said at the time. In fact, the English word ‘law’ is of Scandinavian origin. (As is ‘outlaw.’)
As Norse, we didn’t always reach for the axe. When at home, we mostly reached for the law—a system that had been in place perhaps for millennia. Take Iceland. In each of our districts there, our Thing (assembly) met twice a year to make law and decide lawsuits. Our richest jarls (chieftains) presided. They were combination priests, jurymen, and political representatives. But they didn’t decide the cases. All free men together did, in a sort of organized shouting match. Since almost none of us could read, an elected law-speaker first recited from memory all the laws that the Thing had previously decided, then he advised on points of law while the Thing heard lawsuits.
If you and I were karls (free, land-holding men—women didn’t count), you could kill one of my male thralls (slaves)—as long as you then paid me 12 ounces of silver. That was the law. Take my cow, and you owed me 15 ounces. Kill my brother, and you had to cough up 100 ounces. Whether you cut wood from my patch of forest, stole my boat, or raped one of my female thralls, everything had a price. Anything was okay, as long as I agreed beforehand. If you didn’t ask, you owed me money. If you refused to pay, I could sue you for damages.
If I sued, but you didn’t show up for trial, the Thing declared you outside the law—an outlaw. If you turned up and lost the suit, yet still refused to pay me, you were outlaw. Anyone aiding an outlaw could be sued, and would also become outlaw. Plus, since every offense was potentially worth money, if an offended free man was too poor to bring suit, he could sell his claim to a richer free man, who would. And anyone could kill an outlaw, even if he were a jarl worth 1,000 cows.
Thus, a disturbance of the peace usually triggered larger and larger forces of reaction until the disturbance went away. It worked much the same as termites reacting to a hole in their nest. A hole is bad news because, besides everything else, their nest is a giant lung, maintaining delicate levels of humidity and oxygen. If either of those went out of whack, either termites or their eggs would die. So termites nearest the hole would detect a change in humidity and emit an alarm scent. That would bring others scurrying. They would then start making balls of soil to seal the hole while emitting more of the alarm scent, in the usual autocatalytic way. So yet more termites would show up and stigmergically begin work until the hole sealed. Then, as the alarm scent dispersed, so would they.
So when Lars and Nils sat drinking in the mead hall a thousand years ago, talking about whether to sail out for a bit of rape and pillage, it might well have been because one or both of them had just done Something Awful. They couldn’t go to jail. There were no jails—or cops to put them there. (To have a jail we would first need enough surplus food to feed someone who’s idle.) So if a free man couldn’t pay a fine and couldn’t flee, he was enthralled until he worked off his debt. And thralls had few rights. Their masters could rent, sell, beat, rape, mutilate, or kill them. (Presumably, thrall restocking fees were low.) So if you were outlaw and had a boat, you went viking (pirating), or you went off to discover Greenland or Vinland or someplace—before someone killed you.
However, while we Norse had laws, we still stole from others, because law wasn’t uniform. It was something that applied to the male and free, and their male and free nearest neighbors. More distant neighbors were prey. So when the cupboard was bare, we did what everyone else with good transport did—we went viking to steal from others farther away. It didn’t matter if those others were other Scandinavians. Danes stole from Swedes, who stole from Norwegians, who stole from Danes. The rest of Europe did much the same. They just weren’t as good at it—at least, not back then. In time, though, their tools let them steal whole continents.
But as our physical and institutional tools changed and transport sped up, a bunch of wars led to laws becoming more uniform. Partly as a result, raiding is fading and trading is growing. Theft has changed. Slavery has changed. War has changed.
We’re now so much richer than before that many of our countries, even several of our poor ones, can afford ferocious weapons, standing armies, and mass transport. It’s also hard today to invade a rich place and tell your new thralls to keep running their mechanized farms, chip fabrication plants, and nuclear power stations. Plus, with fast global transport of both matter and data, our trade networks are now much broader and more synergetic. I can still harm you, but you and I are more coupled through trade than before. So, often, what harms you also harms me. And with today’s global network, more of us are watching—and judging—our various squabbles.
In Europe over the past half-millennium, murder and manslaughter rates fell at least twentyfold. In 2013, the United States, widely regarded as our most violent rich country, had 16,121 homicides—but it also had 41,149 suicides. And that was out of a population of 316 million. Such numbers don’t seem to fit an increasingly violent world. We today, rich and poor alike, live in a far richer and safer world than we did when Lars and Nils argued over what to do.
However, while our see-want-take lifestyle may be fading, our international levels of violence may not be. Today’s international law is similar to interpersonal Norse law a thousand years ago. As nations, we still steal, if we can. As nations, we still have analogs of jarls and karls and thralls. We even have a Thing (which we currently call the United Nations), and we have various jarl nations to organize the shouting match (or run the puppet theater, call it what you will.) As nations, we still have kith and kin. We still have foes and feuds. We still have no jails and weak policing. All we lack is another planet for rowdy nations to go viking. Thus, while we today have many more tools, both physical and institutional, than we did in Viking times, we may still be Vikings at heart. The cards didn’t have to change; the card hands have.
Weaving the Web
When it comes to wealth, government and laws may matter for its stability, but trade and markets may matter more since they can help encourage its creation.
A thousand years ago, northern Europe was a poor, ignorant, powerless backwater on the edge of the world stage. At the time, its muddy streets were filled with dung and slops, and would go unpaved and unlit for the next eight centuries. London was a small town, housing only about 15,000 of us, and Paris, housing perhaps 40,000 of us, was northern Europe’s biggest ‘city.’ Few of us there lived together, so most of us didn’t even need last names.
But while in northern Europe we slept in the dark with our dogs on flea-infested straw sans surnames, in southern Spain we lived a perfumed, sybaritic, cosmopolitan life. Just one city, Qurtubâ (today’s Cordoba), housed about half a million of us. There we had miles of paved streets with 50,000 street lamps—Europe’s first streetlights. We had 113,000 houses with running-water toilets—some even among the poor. We had many parks and fountains. We had 300 public baths and 700 mosques. We had a postal service stretching all the way to India. We had bookshops, hospitals, universities, and 70 libraries. Just one of those libraries held around 440,000 books. That was more books than in all of France—whose largest library, the Sorbonne, held perhaps 2,000 books. Another city, Tūlīdū (Toledo), had more books than all of northern Europe put together.
Northern Europe, compared to China or Arabic-speaking lands, had few books, little currency, and limited trade. Instead it had Vikings. As far as our moneyed and literate world cared, about all it was good for was sable pelts and slave-girls. Traders helped change that.
One of the few that we today know of was named Godric. Put yourself in his shoes—if he had shoes, that is. You’re born a peasant in the Norfolk fens of Engla-lond around the time that the Normans invade in 1066. Like most everyone, your father is an earthling, bonded to the soil he furrows, and thus to his thane, who holds that land. Normally that would be your life too, but as a youth you somehow chance to become a peddler.
Maybe that happened this way: Suppose you one day catch an especially nice hare, which you then trade to an earthling for a wheel of cheese. Then on your way to the next thorp, you meet a widuwe riding on a madm. She’s on pilgrimage to the nearby Our Lady of Walsingham shrine and you trade some of your cheese for some of her pins and needles. Although no cash changes hands (you have none), those two trades make all three of you richer.
Wealth isn’t about currency any more than currency is about gold. Wealth is about options. The earthling now has more options. He has a plump hare with a beautiful pelt that he can breed with his other hares, having given up some cheese he values less. He had six wheels of it and one or two would almost surely have fallen to the rats in the time his family took to eat the rest. The widuwe also has more options. She has cheese for supper when all she had before was some spare pins and needles. She knows that her pins are valuable, since in your world worked iron is so rare that a shod horse is worth twice an unshod one, but she still has to eat. Neither the earthling nor the widuwe would have agreed to trade had the trades not benefited them.
You, too, have more options, but your gain is more subtle. You happen to know that your pins and needles are worth more than a wheel of cheese to a nearby thorp’s webbestre. She needs them to finish a wedding gown for the local thane’s 13-year-old daughter. The webbestre can’t ask her thorp’s isenwyrhta to make some more for her because he’s ill. Plus, his apprentice has just run off with some traveling gleemen. So she will pay a good price. You know all that, and the widuwe doesn’t, because on your rambles you had earlier visited the webbestre’s thorp.
Of course, you could instead have told the widow about the weaver. The widow might then have gotten more for her pins had she delayed her pilgrimage and ridden to the weaver’s hamlet. But she may also have been waylaid on the way. Also, the farmer might have gotten more for his cheese had he walked toward Walsingham and met the pilgrim. But while he was doing so, nobody would be tending his fields. Similarly, while the weaver might have asked another village’s blacksmith to make some pins and needles, who would work on the wedding gown in the meantime?
We all live within limits. We each have only so much time, skill, and knowledge. So we divide our labor. We each do whatever we do best, leaving everything else to others. We lose wealth when the webbestre abandons work on her gown, or when the earthling abandons his fields. So some of us sew clothes, some sow seeds, some schlep goods. By dividing our labor and trading, more of us can live on the same amount of resources.
Your trades thus aid those who you trade with. You aid them another way, too. Without them having to meet, or even know about each other, they each learn more about what their holdings are worth. Wealth isn’t fixed. It only makes sense in terms of what others want.
Your trades thus transport both matter and data among us. They also link many of us who might otherwise not have been linked, like the earthling and the widuwe. Plus, they link many more of us—because they link everyone you trade with, like the webbestre, and everyone she trades with—like the thane—and through the thane, his daughter, and so on.
So when you trade, you’re weaving us into a network, just as the webbestre weaves threads into cloth, or as the isenwyrhta hammers iron rings into chain mail. You’re using your knowledge, sacrificing your time and travel, and risking loss of your goods, your health, perhaps even your life, to shuttle goods and data between the farmer, the widow, and the weaver, much as a loom’s shuttle binds threads into cloth. Your reward is profit, if you make one. But whether or not you do, your networking both simplifies our lives and enriches us. Your trades even out demand and supply, grow our overall wealth, and establish prices.
You’re performing yet another service. In a world without newspapers, or folks who could read them, you spread gossip. In some thorps you might be the only regular source of news. Aside from peddlers like yourself, and the few gleemen and scops who walk about singing songs and telling poems, as peasants we rarely travel. Weekly or monthly trips to a nearby market, or a yearly trip to a distant fair, might be about all. Even when we do travel, most of us never venture more than about seven miles—a day’s round-trip walk. Anything farther away is too costly. A horse or ox costs as much to feed as one of our families do, so we mainly share them with several families and use them for plowing, not riding. Also, travel is dangerous and scary. Wolves and bears in the forests, and footpads on the roads, are constant fears. Plus, for 20 years—your whole life so far—the Norman invaders have been fighting to put “Norman spoon in English dish.” They meet any resistance to their theft and rape with fire and sword. In many rebellious places they lay the land waste, burning cot and crop, and butchering man, woman, and child. They also kill all the pigs, cows, and sheep—to make sure that no rebels can sneak back.
So for many of us who become your clients, our three dozen or so cottages in the middle of a forest might as well be the whole world. For general knowledge and amusement, all we would normally have is a gaffer, or the female version, gammer—that is, some leather-skinned, gap-toothed, dung-footed yokel of perhaps 40 or maybe even 50 winters—who, for the price of an ale, spins tales of a long-ago trip to Lincoln, or maybe York, or perhaps even distant London—the southern end of the long Roman road—where, so they say, many thousands live. At the time, everyone you know reckons nearby Norwich a rich ‘city’ for supporting over 5,000 of us. (It also has 25 churches, and plenty of sheep, and is, along with York, one of the largest ‘cities’ in Engla-lond, after London.) So as you make your rounds along Norfolk’s marshy coast, you aid all of us there, and thus gain wealth.
Whether or not you make money from any particular trade, the mere act of trading profits you. As you trade, you learn more about who has what and who wants what—there’s always too much of one thing here, and too little of another thing there. You also learn what we’re willing to pay for our wants. And regardless of how your trades go, with each one you learn more about how to trade. So the more you trade, the more trading knowledge you gain and the better you get at trade. You’re refining a map of what’s where, what it might cost, and what you might extract in exchange for your services. Your head is where demand meets supply.
After four years of slogging through the fens, you make enough to buy a hand-cart, or maybe even an ox-cart. You then fall in with a group of other peddlers. On your second trip to York, you join one of the first guilds then forming in Engla-lond—the guild of chapmen (traders).
Once you have partners, you’re safer. On the road, cold-eyed folk with meaning stares and cash flow problems no longer do more than finger their cudgels as you pass by. Plus, your partners can stand bond for you in gemots if you get into trouble with the law. You can also take larger risks by partnering in new profit centers—fairs, shops, warehouses, bribes. You get richer.
In time, your firm makes enough money to buy a share in a trading ship on its way to faraway Scotland. From the proceeds, you buy shares in other ships. You thus spread your risk by diversifying your portfolio. You’re now not just a trader but an investor in an informal stock market made up of ships, their owners, and their investors. Over time, you gain control of half a ship and a quarter of another. You make longer and longer trips and grow richer and richer. Then one day you give everything away and go live in a cave, then later a wattle hut with snakes in the roof, living on roots and leaves.
You do that because the Church thinks you’re evil—not just you, all merchants. How else did you get rich? To the Church, it’s okay for an aristo to take a brute squad and go butcher or enslave some foe and steal their stuff—after all, the enemy always look funny, talk funny, or believe funny things. But it’s not okay for a peasant to profit from trade.
Within small, poor, isolated tribes living in constant climes—which about sums up all of northern Europe at the time—everyone can agree on the value of everything. So the Church believes that each trade good has a ‘just price.’ Thus, four iron horseshoes must always be worth one horse. How could it be otherwise?
The Church didn’t invent that idea. Homer looked down on traders, too, perhaps 1,800 years before. While he wove words into text, and had richly dowered Penelope weave (and unweave) thread into textile, he wouldn’t let many-wiled Odysseus trade during his long journey home. That wouldn’t be heroic; it would be insulting.
But you puzzle the Church. You don’t fit. Everyone else fits: slave, serf, priest, knight. Europe’s few artisans aren’t a problem, either. All those weavers, smiths, wrights, and so forth, must just be special kinds of serfs or slaves. You, though, have no obvious skill and no obvious place. You’re mobile, you don’t make anything, and you weren’t born to wealth, yet you keep getting richer. You must be either forcing or fooling somebody—but how? So it can’t simply whip, exile, or kill you.
Try as it might, the Church couldn’t fit profit from trade into its world. Profit from theft (war), yes. Profit from gift (land), yes. But not profit from trade. It couldn’t see you as a kind of weaver, with us as the warp and the weft. So it couldn’t understand where your profits came from. Living in a frozen, just-price world, where trading is pointless and profit is sin, you come to agree.
So you give up your wealth. For perhaps 40 years, you pray, fast, stand vigil, wear a hairshirt and sackcloth, and whip yourself. As a peasant, you can’t read Latin, but you still learn to recite some of the Psalter by heart. You spend many winter nights in a freezing river, trying to master your lust. Then you die. Later, you’re sainted—not for gaining wealth, but for rejecting it.
However, in the 1100s, northern Europe’s frozen world began to thaw as it absorbed gobs of Arabic books from Muslim Spain in stages, like a python choking down a pig. Its first universities followed. Also, its climate had been warming since about 800, and new farming tools—among them, the wheeled iron plow and crop rotation—opened up virgin land. The horse collar and the nailed horseshoe alone increased crop yields 50 percent. The forests fell and the villages spread. Between 1150 and 1300 our numbers there tripled. In the warming climate, as new tools, like the windmill and the waterwheel, spread, and learning and produce rose, so did towns and trade.
Thus, England, with the climate of today’s southern France, grew grapes and exported wine. (And wool and slaves.) It was then rich—well, rich for northern Europe, anyway. Its silver coinage doubled between 1158 and 1180 thanks to new silver mines in today’s Bohemia and Moravia. By the 1220s, England would mint about 4 million silver pennies a year. By the 1240s, it would mint ten million—then 15 million in the 1250s—then 40 million just in 1279-1281. In the 1300s, all those numbers crashed again as temperatures fell, but traders in northern Europe slowly kept growing in both numbers and wealth.
However, resistance to trade and markets long remained strong. Six centuries after Godric, and three thousand miles east of Norfolk, Boston Puritans were still arguing about ‘just prices.’ In 1639 a shopkeeper was brought up on charges of “profiting too much from trade.” He was fined £200, a huge sum. A rich man, and the most successful of Boston’s traders, he was also a devout churchgoer. Narrowly avoiding being kicked out of the church, he “did, with tears, acknowledge and bewail his covetous and corrupt heart.” Church leaders were still puzzled by trade and profit, even though the Church was no longer Catholic but Protestant, and the place was no longer England, but New England. To many Bostonians, profit was still sin. To many of us today, it still is.
Bright Lights, Big Cities
In the 1800s, four waves of our industrial phase change—triggered by the steam engine, the railroad, the factory, then many new tools and a huge burst of energy—began to change some of our lives greatly. Those tools, and the ones they triggered, vastly changed not just our numbers, but also the number and size and linkage of our cities. Our species is as rich as it is today largely because of that, and that’s because of our tools, both physical and institutional. But we developed those tools largely because more and more of us started surging into cities, even before the steam engine. Both processes aided each other. Why, though, do we live in cities at all?
After all, unlike termites, we can survive alone. So why aren’t we spread out over the planet in a uniform mat?
We each need about the same amount of water per day. So doubling a city’s size roughly doubles how much water it needs. Ditto for how much food it needs, how much housing, how many beds, how many jobs, and many other things. That’s linear growth, the kind we usually expect. If that were true for everything, cities would have no economic point. But not all costs grow linearly with our numbers. For example, water is cheaper per person if we live together. Or to sharpen an old saw: Two can live as cheaply as 1.4.
That savings extends beyond just two of us. Doubling a city’s area more than doubles its number of highway exits. (That is, they grow faster than linearly—so, super-linearly.) However, that same doubling fails to double its number of highways. (They grow slower than linearly—so, sub-linearly.) Similarly, doubling a city’s population roughly doubles its sewage. (It grows linearly.) But that same doubling fails to double its gasoline use. (It grows sub-linearly.) Denser housing and public transport make the difference. The same sub-linear growth applies to miles of cabling, hospitals, schools, gasoline stations, and many other things. That’s the usual economy of scale. A million urbanites need far less infrastructure than a million hermits do. So, per person, it’s cheaper.
That’s one reason we have cities.
But there’s another reason. A city tends to have more inventors, innovators, and investors than its size predicts. (Their numbers tend to grow super-linearly.) Why?
Rare talents are, by definition, hard to find. Combinations of rare talents are even harder to find. (One in a thousand times one in a thousand is one in a million.) So the chance is near zero that reaction networks of such talents might form in a village of size one hundred, but is higher in a city of size one million. That chance is higher still if a wide variety of us live near each other. So density coupled with diversity tends to lead to reaction networks.
If such a network makes something new, shorter distances and wider data exchange mean that potential customers for that new thing might hear about it more easily. Plus, if it catches on, transport costs would be low. Also, more easily divided labor and longer-distance trade mean that potential customers might have more money to spend on new things.
So, in a city as opposed to a village, we tend to: make more new things, which reach wider markets more quickly, and are more widely advertised, and more money chases them. So more inventors, innovators, and investors tend to flock to the city in the usual autocatalytic way.
Whatever drew in one such firm might well draw in similar ones. Then those new firms will draw in yet more new brains and hands, which will draw in yet more new firms, autocatalytically. Competition will then drive similar hands and brains and firms to specialize even more, whether it’s in carpet-making or movie-making, car-making or computer-making, retiring or pickpocketing. So that growing pool of brains and hands attracts specialized firms to the city in the usual ecogenetic way.
Further, for the ever widening variety of new things they do, there’s an ever widening variety of new customers, including folks who don’t even live in the city but who are drawn to it just to visit. The city might have been sited on a river for its fish (and water and waste disposal), but after a while its mere existence might create another river—a river of passing money—for it to fish in.
Yet further, most cities are sited on transit ports—crossroads, rivers, bays—thus linking them to many other cities. So moving from a village to a city is like jacking into the world grid—millennia before we discovered semiconductors, or even electricity.
So in many of our cities, reaction networks, autocatalysis, and ecogenesis are all more likely. Thus, doubling a city’s size needn’t merely double its income (thus leaving average income the same). Instead, per person incomes often go up. So, per person, we’re richer.
That’s another reason we have cities.
Thus, our cities tend to have sub-linear costs yet super-linear returns. In short: They’re wealth generators.
That matters in our rich countries, but it matters even more in our poor ones. As of 2005, over a billion of us were squatters, living in relative squalor in huge shantytowns. But we weren’t herded there at gunpoint from some pristine countryside. Instead, we shoved ourselves in, despite the best efforts of our city leaders to keep us out.
Take Brazil. A news report about Rio de Janiero’s favelas might focus on its trade in sex, drugs, and weapons—or on its crime, grime, and disease. All true. But such a report is less likely to mention that in 1996 the infant death rate there was less than half that in all of (rural) northeastern Brazil (3.3 percent versus 7.4 percent). Rural life in our poor countries is poorer, harder work, more limited—and more boring.
Cities are magnets. They needn’t necessarily make more of us poor; they attract more of us who are poor. So counting the number of us who’re poor in a city is like counting the number of us who’re poor around a gold mine. How likely is that number to be zero?
In our cities versus our countryside, we have more crime, traffic, and pollution. But we also have higher incomes and more job choices—and we can more easily learn from others farther away. Urban birth rates, death rates, schooling rates, and poverty rates are all lower than rural ones. Jobs, schools, medical care, water supplies, waste disposal, amusements—all are more alluring. As city dwellers, we have fewer kids, and, controlling for income, we eat more and better food, and consume more energy and durable goods.
That’s why in 2012, if we treat metropolitan areas like countries, New York would have been the world’s 13th richest country—making it almost as rich as Australia, and about as rich as Spain. Los Angeles was about as rich as the Netherlands, and richer than Saudi Arabia. And Chicago was richer than Sweden. So our cities grow, if they can.
Our cities can shrink, too. In 1930, almost a million of us lived in Liverpool, and in 1960, over a million and a half of us lived in Detroit. By 2010, our numbers in Liverpool had almost halved, and in Detroit they had more than halved. Usually, though, we don’t flee a city for the countryside; we flee one city for another (or a suburb or exurb). Regardless of where one of our cities is, the bigger it is, the richer it tends to be. In 2004, urban economic activity accounted for over half of national income in all our countries, whether rich or poor. In Europe and Latin America, that figure was over 80 percent.
However, while our cities are richer, and have made our species richer by being on average more inventive than the countryside, before our health tools changed, cities were also sicker. In them, diseases used to kill us faster than we could spawn, since microbes could spread faster and survive longer, leaping from host to host faster than their hosts died. So our cities used to be super-linear serial killers. Crimes and fires also were super-linear, too—and crime still is.
Thus, over the past two millennia, today’s Alexandria, Rome, Xi’an, Baghdad, and Tokyo had each grown to about a million. Before 1800, that was about as big as any of our cities could get. For instance, London in 1700 supported about a half million of us. Without a yearly inflow of 8,000 or so migrants, sucked in by the chance of higher incomes, it would have eroded back into a village. In Rome two millennia ago, such erosion was even stronger, since life expectancy at birth there was around 20 to 25 years.
In our recent past, though, it became safer to live in a city than in the countryside. So while in 1800, only about two percent of us lived in cities, by 1900, around 13 percent of us did. By 1950, almost 30 percent of us did. By 2000, almost half of us did. By 2050, over two-thirds of us likely will.
Today we’re fleeing the countryside at ever faster rates. But hang on, if sheer density is so great, why don’t we live in even denser clumps than we do now? In 2009, Delhi was our largest city. But it only housed 21.7 million of us. For urban areas instead of cities proper, the Greater Tokyo Area was our largest with 36.5 million. The Hong Kong-Shenhzen-Guangzhou region, although not a city, housed about 120 million of us. Why haven’t we yet crammed ourselves into cities of 100 million or more?
Many aspects of cities grow sub-linearly as cities grow in size because cities exist in space. The same is true for a life-form, whether it’s a marigold, a banana tree, a mouse, or a whale. Any mass of cells, whether in a plant or an animal, can live together more cheaply than they can apart once they have some sort of vascular system to support them, just as a mass of us can live together more cheaply than we can apart once we have a river and a road and other things to support us. For anything that’s built of more than just a few cells (or termites, or people), it’s cheaper for it to build specialized infrastructure that fetches resources, removes wastes, and provides mechanical support. That leads to many sorts of sub-linear (or super-linear) growth regimes as the number of cells (or termites, or people) grows.
So while a big city may attract us with its sub-linear costs and super-linear returns, to exist at all it also has super-linear appetites. Like a hibernating bear, it needs to breathe in and out at a certain volume and speed, even when it’s asleep.
In 2000, Greater London was home to 7.5 million of us. In a typical day, our London hive sucked in 520 million gallons of water through its 10,000 miles of pipe. Four-fifths of that water came from the Thames, which it had built itself around millennia ago, like a wasp’s nest on a tree branch. But four-fifths of its food came from off the island it nests in. Each day, its tentacles—ships, planes, trucks—gathered in 41 million pounds of food. (Pets got 15 percent of that.) That day, it threw away 2.7 million pounds, uneaten. It also breathed out 247 million pounds of carbon dioxide. (Seventy percent of that came from building and maintaining its structures.) It guzzled about one and a half million gallons of gasoline and 25 million gallons of bottled water. It spewed 24 million gallons of sewage. And it excreted 160 million pounds of garbage using its 500 garbage trucks and barges.
Just as the beast’s moving parts needed food and water and such, so did it—namely, us. That same day, it sucked in about 800,000 of us from the outlying suburbs to work, then spat us out at the end of the day. During the day, its subway orifices inhaled three million of us only to exhale us at other orifices. Its 52,000 police officers kept down the carnage, while its 7,000 firefighters kept down the flames. Its 53,100 teachers took care of its 1.2 million kids. Its 400 ambulances and 100 rapid-response cars handled accidents, shootings, and bombings. Its 50 hospitals and 4,000 doctors took care of its sick and wounded, while it pumped out 1,300 babies and 160 corpses. That day, too, it topped up its cash machines and cash registers with at least £100 million in cash. At any moment that day it might have at least £4.2 billion in cash percolating inside itself. It posted eight million letters that day as well. And at peak times that day, it routed over 200,000 gigabytes of data an hour. In that hour, it sent more than 2.2 million cell-phone text messages. It also placed over 7.5 million landline phone calls—one for every one of its men, women, and children.
How big our London hive can grow depends on how cheaply and how quickly it could keep doing all that without systems failure. And that depends on our tools, both physical and institutional. Change them and our cities respond ecogenetically, just like food webs.
A lot of that comes down to moving matter and data around. In the Star Trek reality, with its transporters and subspace radios: anyone can beam almost anything almost anywhere and talk to anyone almost anywhere, seemingly instantly, safely, securely, and for free—yet for some reason they still have cities. But if matter- and data-flow really took no time, had no dangers, and cost nothing, cities wouldn’t exist. Why live near where we work, if we could live anywhere? Why shop near where we live, if we could shop anywhere? Come to that, why ingest food near where we extract waste, if we didn’t have to? On the other hand, if transport were to cost too much, or be too dangerous, or take too long, again cities wouldn’t exist because we would all have to be self-sufficient. Outside of villages, we would have no way to divide labor and spread production. Thus, cities exist because we’ve found ways to balance off the time and cost of transport—whether it’s food or water, people, goods, waste, data, or just about anything else.
Take railroads. Before them, our cities could grow to only a certain size before starving. For instance, in New York before 1841 few of us had seen fresh milk in decades. So after railroads, cities grew. Then, just as railroads dispensed with rivers, harvesters dispensed with (human) reapers, forcing them to go find jobs in cities. Also, icehouses and chilled railroad cars (then steamships), then later, fridges and refrigerated railroad cars (then container ships), dispensed with seasons, turning summer into winter. With each new tool, our cities grew—because we could live farther away from fresh food. The same thing happened after tin cans, and many other inventions.
Similarly, once upon a time, cities could only be about as big as one of us could walk in about an hour, because that’s how far we could be from the resources we needed to buy. Railroads, then streetcars, then cars, changed that. Also, once upon a time, cheap buildings could only be about as tall as the weight that fired clay brick could support, which was just a few stories. Before prestressed concrete, high-tensility steel, elevators, air conditioners, fluorescent lights, and acoustic ceilings, today’s skyscrapers couldn’t exist. Before sewage treatment, today’s big cities couldn’t exist at all.
No inventor of any of those things intended bigger cities. But the bigger the city, the more likely was it that we could invent more tools, some of which led to bigger cities. So city growth is more than autocatalytic; it’s synergetic. We make a hammer, and with that hammer we make a building, and with that building we make a city. Cities are the biggest things we make. They’re tools, just as hammers or steam engines are, even though we don’t think of them that way because they’re so huge that millions of us live inside them, just as termites build and live inside termite nests, They’re invention machines.
Of course, unlike hammers or steam engines, cities aren’t inert or automated; we’re inside them and we make them go. So they can be other things, too. They can be combination marriage mart, trade depot, political capital, financial nexus, religious center, transport hub, shopping mall, watering hole, amusement arcade, crime hotbed, and disease nucleus. They’re where we meet each other as strangers in large numbers. Sometimes that amounts to stuffing too many rats in one cage. But other times, too, it raises the chance that one and one can make three—1+1=3. And without that, while we would surely have had hammers, we might never have had steam engines, railroads, factories, and so on.
Armed with the city, our massive invention machine, the denser we got, the more resources we could discover. But, also, the faster we consumed them. Thus, in 2000 the 7.5 million of us in our London hive kept ourselves powered, warm, and lit by burning 154,407 gigawatt-hours of energy. That was more than the 3.8 million of us in all of Ireland burned—and about as much as the 10 million of us in all of Portugal did, or the 11 million of us in all of Greece did. Further, London’s ecological footprint—that is, the land and sea area that it needed to survive—was more than twice the size of all of Britain. Similarly, in 2000 our Hong Kong hive supported over seven million of us by trading its goods and services for the resources of a planetary area 2,000 times larger than itself—and two-thirds of that was outside China.
In 2006, our cities as a whole covered only about two percent of our planet’s land area, yet half of us lived there, burning three-quarters of all the energy that we burn. As we all get richer and squeeze into ever bigger hives on ever smaller patches of the planet our resource demands seem set to grow. We’ll all want to drive cars and eat meat every day. Where’s all that energy going to come from?
Viewed from orbit, our growing cities look a lot like slime molds—large single cells that build themselves by sucking in many nearby amoebae. We are their amoebae. At the rate we’re massing now, megacities of 100 million or more are far in our future. But by 2030 or so, fluid megacities, perhaps even brief gigacites, of a sort, seem possible if our electronic networks keep cheapening because we might by then start massing non-physically. Maybe by then, to be in constant touch we won’t have to live next door to each other anymore. Metaconcerts to solve our various problems, at least our technical ones, then seem possible. The super-linear income effects of density and diversity thus seem set to not just continue but perhaps rise sharply. We may be headed into another invention boom. But if so, we’re going to need it.
The Non-Linear Elephant in the Living Room
We can do things together as corporate bodies—firms, cities, markets, governments, countries, sometimes even whole regions—that we can’t do when we act alone. But when we incorporate we also face many problems. We try to control them with laws, offices, institutions, and other non-physical tools, yet still we make messes. Why?
The following story is made-up, but it’s based on real events: One day a city reporter writes an article on slum housing. Citizens are outraged. City leaders pass a bylaw forcing tenement landlords to improve housing. Problem solved. But, oops, rents go up. The poorest of us get evicted, so we beg in the streets and bother tourists. Crime rises, tourism falls, stores close. Downtown is turning into a slum. A reporter writes an article on homelessness. Citizens are outraged. City leaders pass a bylaw forcing landlords to freeze rents. They also create an agency to see who’s needy and subsidize their rent. Problem solved. But, oops, someone has to pay for the new agency and the new subsidy. Property taxes go up. So some of our rich begin to flee the city. Plus, cheap housing attracts our poor from outside the city. So housing demand goes up, therefore building costs rise. But landlords can now neither raise rents nor cut costs. So they begin to go broke, apartment blocks decay, and more of our poor roam the streets. So crime rises, tourism falls, stores close. Overall: Downtown is slummier; taxes are higher; government is bigger. A reporter writes an article on council bungling. Citizens are outraged. A mayoral election is held and a new crowd comes to power, chasing out the old crowd with slogans like: ‘Fresh,’ ‘New,’ ‘Hope,’ and ‘Change.’ Problem solved. But, oops, much of the institutional learning leaves with the old crowd. Then one day a reporter writes an article on slum housing....
Start in cheers, end in jeers; that’s why politics is so often smears and sneers. We often choose quick, cheap, popular—and wrong—solutions to our corporate problems.
Partly that’s because we often assume some or all of the following: We can change something and nothing else will change. If we change something and get a certain effect, then if we change the same thing again we’ll get the same effect. If we change something and get one effect, and if we change something else and get another effect, then if we change both at once we’ll get both effects. And if we change something a small amount, it must have a small effect. (So a large effect must mean that someone else must have made a large change somewhere else.)
Mathematicians bunch all such assumptions under one word: linearity. If effort X yields result Y, then effort 2X will yield result 2Y.
That notion contains the special case of linear growth, which is only about how things change when the number of something is growing. In essence, linearity assumes that things don’t interfere with other things.
But that’s rarely true in networks because there many things link. So a small change might have a large effect. Also, a small change might have different effects depending on when it happens. Further, if a small change does one thing, a larger version of the same change needn’t do more of the same. So a network needn’t behave linearly, even if it isn’t growing.
We have trouble understanding, and thus controlling, our networks, so we usually try to design our things to work linearly (or at least, predictably). Thus, in the shower, if we turn the hot water knob a little, the water will get a little hotter. It won’t get scalding hot. It also won’t get hot hours later; it will react in seconds. Roughly speaking, doubling the size of the turn will quickly double the increase in the water’s hotness. Further, things that seem unrelated to hot water won’t change. The shower head won’t fall off; the bathroom mirror won’t explode. That is, the shower behaves linearly. However, for the shower to work it must link to a plumbing network. But then, we might still get scalded, even if we don’t touch the hot water knob—if someone flushes a toilet in the same room. It’s not only the knob that’s controlling the shower’s hotness.
Further, even if a network’s parts aren’t directly linked, they might be linked through things they share, which means that they can be linked across time rather than space. Suppose a big store tries to suck us in by running a special one-time sale on diapers. It expects to lose money on that but make money overall because we may buy other stuff when we’re there. However, if too many of us rush to the store, its diaper supplier may soon be out of stock. If so, the supplier places a big order at the distributor, which places a big order at the factory, which ramps up production. Meanwhile, the store has great sales, so it orders even more diapers from the supplier, which does the same from the distributor, which does the same from the factory. But all those orders take time to fulfill. At some point the factory begins to deliver to the distributor, which delivers to the supplier, which delivers to the store. But by then many of us are angry because we went to the store expecting cheap diapers, yet there weren’t any to buy. The store is angry because it lost both sales and customer goodwill. The distributor is angry because it had to cancel orders and pay overhead delivery costs. The factory is angry because it had to convert resources into excess product, which will take months to sell.
Our networks can behave in such peculiar ways because no matter how linear we try to design their parts, whether showers or firms, to function they have to link to everything else that already exists.
Physicists might call any such network non-linear.
In a network, node A might affect node B. But knowing all about node A may not be enough for us to predict node B’s behavior, if node C also affects node B. So to figure out how B will behave we need to consider both A and C.
However, even knowing all the direct influences on B may not help us predict B exactly—because B may also affect itself. B might affect A, which, after some delay, then affects B. That’s direct recursion, a simple form of memory. Autocatalysis and its general case, synergy, are examples of that.
That’s not all. B might also affect itself by indirect recursion—a more involved form of memory. That can happen when a network affects the world it’s embedded in, which, after some delay, then affects it. Stigmergy and its general case, ecogenesis, are examples of that. To such networks, the world they’re embedded in is an echo chamber, which can then affect them.
So B’s behavior might depend on both A and C, and its effect on them, and also on how B itself behaved in the past. Such amplifying recursions might even make possible network phase change.
In a complex network, how nodes behave can depend on what other nodes they’re linked to now—that is, their network’s current structure—but it can also depend on what happened to them in their past, which might be their recent past, or maybe even their distant past, not just what’s happening to them now. In effect, such a network’s nodes might be ‘talking’ to each other, and across not just space but also time—even if they don’t know it—and even if they can’t ‘speak.’ In other words, complex networks can have a memory—even if their nodes don’t have brains.
For instance, our immune system is a complex system. Were it linear, it would be useless. If an antigen’s second invasion didn’t trigger a faster and larger response than its first, we could die.
Thus, such networks needn’t be just embedded in space, nor need they be just spread out over time; they can be embedded in spacetime. They may be by no means linear.
Linearity (or at least, predictability) can work for our showers and firms, but only if we planned them that way. It doesn’t work for our cities or economies—or pretty much anything else that’s complex. We try to control them, but we surely didn’t plan them. They grew—just like marigolds and bears and food webs. Yes, we built all their parts (and often tried to design them to begin with). And, yes, we tried to make them linear (or at least, predictable, and thus controllable). And, yes, we, or at least our leaders, pretended that we knew how they worked. But once we hooked them up, how their networks behaved often baffled us. They took on a life of their own.
Most real reaction networks are recursive, and hence non-linear. So calling a reaction network ‘non-linear’ is like calling all animals besides elephants ‘non-elephants.’ We still use the adjective because it’s easier for us to think about linear networks, so that’s what we started with long ago, and that’s what we keep hoping that everything is (at least at first). Thus, we treat non-linearity like an elephant in the living room. (Or rather, a non-elephant in the living room.) We all can see it, if we choose, but we all pretend that it isn’t there.
That has consequences.
Here’s another made-up story, again based on real events: Suppose one of our poor countries is going broke; will one of our rich countries bail it out? In a rich land, a bailout might sound like charity. ‘Give generously,’ some say. ‘Charity begins at home,’ others say. But a poor country wouldn’t be failing unless it had creditors demanding more money than it has at present. Its largest creditors probably don’t even live there. Also, they wouldn’t have lent money in the first place were the potential profits not high. Those profits wouldn’t have been high were the risk of loss not also high.
So when a rich country bails out a poor one it may just be shunting tax money to its own highest-stakes gamblers. The poor country might not even benefit. A big enough bailout might just prop up its exchange rates long enough for rich foreign gamblers to siphon their money to banks in Cyprus and Switzerland—or Bermuda and the Cayman Islands. So a bailout might even make the poor country poorer, not richer.
So the arguments go on. ‘Keep the system going,’ some say. ‘It’s all a scam,’ others say. But bailouts still happen, and regularly. It isn’t because of charity. It isn’t because of conspiracy, either—though conspiracy might indeed be involved, just later. It’s an attempt to staunch the bleeding for fear of worse.
The bailout might not even be about the poor country but about the rich one. Too many of its big banks may have lent too many petrodollars for too long to too many unstable poor countries, one of which then took one too many big risks. However, letting even one of those banks pull out would lead to a rout, which would expose all those bad loans to news headlines, which would collapse all those big banks. So under cover of saving the poor country, the rich country would actually be saving itself. (That actually happened—in August, 1982).
Just as in the 1920s, since the 1980s global finance has become one big house of cards. So the usual idea has been to try to stop our big panics while we still can.
But the arguments go on, because we don’t know how to do that. Were we to safeguard every loan, all we would then do is lend and borrow even more riskily.
Here’s why, using yet another made-up story, again based on real events: After each financial, fiscal, or monetary crisis we always think the same thing: ‘Never again!’ Then we point the usual fingers and call each other the usual names. Then, picking through the smoking wreckage of our financial lives, we cobble together risk strategies that seem to ensure stable financial flows.
With our last drubbing still fresh, we don’t borrow more than we can repay. So debt is low. There’s just enough to keep our financial network ticking over.
But since debt is low, a few of us begin to profit by taking a bit more risk. Because only a few of us are borrowing a lot, interest rates are low, so money is cheap. (Interest is a bribe we pay to delay repaying a lump sum; so when few of us fear repayment, there’s not much need for that bribery.) Time passes and more of us profit, regardless of our specific risk strategy, so we all begin to think the same thing: ‘Risk is low!’ So more of us take more risk.
As our confidence in easy borrowing rises, we lend more easily—since if we can borrow easily, so can those we lend to, so the chance that we’ll get repaid is high. Credit thus rises autocatalytically, and profits rise with it. Our safety-first risk strategies thus diversify into a mix of risk strategies, just like an ecogenetically growing food web, except that it’s one based on debt, not food.
But even though more of us are risking more, most of us still think that risk is low, since for every buyer in the debt web there must be a seller, and for every borrower there must be a lender. So for every dollar going out there’s a dollar coming in. However, as more of us borrow and lend more, and at higher speeds, the velocity of money sloshing around our debt network rises. As that velocity rises, at least some sellers and borrowers are increasing their selling and borrowing simply to get more money to become bigger buyers or lenders.
But as the velocity of money rises, while more of us might make more money more quickly, few of us may feel richer—because others of us are making even more money even more quickly. Thus, each ratchet up in income only makes us feel as poor as before, but in a whole new way. Further, even for those of us making the most money, we have to find something to do with all that extra money. Seeking profit, we lend more out—and at higher rates, which means in ever riskier ways. Thus, nothing pushes any of us toward lowering our risk.
So the bubble inflates. Inside the market, all of us take on yet more risk. Outside the market, smelling a gold rush, we stampede in. And whether inside or outside, we try to borrow yet more money to get in on the action. So the mix of risk strategies in our debt web shifts and shifts again until many of us are taking a lot of risk. We aren’t just borrowing on what we can repay, we’re borrowing on what we can’t repay—on the assumption that we could repay it tomorrow. So leverage rises.
Now it’s boom time, and we’re all excited. Some of us now know that risk is rising, but we still take even bigger risks, for the same reason that seat belts, which protect our lives at higher speeds, often only encourage us to drive faster—because we can. However, risk is now so high that soon some of us survive solely on borrowing. We have to borrow today just to pay off yesterday’s loans. We’re betting that tomorrow will be not merely better than today, but far better.
Such a high-risk strategy can work—but only for as long as most of the rest of us in the debt web still think that risk is low (otherwise we wouldn’t lend to takers of such high risk).
The casino then hums along nicely—until some of us notice that it’s a casino. It doesn’t matter what first shocks our debt network. It may even be as small as a completely false rumor. For whatever reason, as soon as some of us notice that instead of getting richer we’re really just playing a game of hot potato with ticking time bombs, a few of us lose our nerve. Those few then try to liquidate, hedge, space out debt payments, or otherwise deleverage, seeking safety. But we’re all linked in one network, so counterparties of those first few safety-firsters now find their own liquidity drying up. So they seek safer ground, too. Liquidity thus dries up further. Interest rates then begin to climb. Money is getting tighter, but debt is still high.
At some point, a few of us with the riskiest strategies go broke. If that happens quickly enough, or happens to enough of us at once, we all start thinking the same thing: ‘Risk is high!’ Panic now spreads. Asset sales to pay down debts then follow. Those forced sales then drive down other asset prices, which further weakens many asset-holders. With more of us scrambling for safer money harbors, interest rates keep rising. Tighter money then forces further asset sales.
Just as our credit market had wound itself up autocatalytically, it now winds itself down autocatalytically—but faster. If that happens fast enough, then even those of us with the safest risk strategies in the market suddenly can’t get credit. The whole market might then seize up as the game of pass the parcel ends.
Then comes the usual finger-pointing and name-calling as we stare at each other among the smoking wreckage of our financial lives.
Nor is that the end of our debt-fueled food-web cycle. After we go through enough boom-bust cycles, or after a really big crash—especially if it ends in bloodshed—we change the market’s rules. We place triggers for countercyclic behavior so that high-risk strategies are no longer so easily rewarded. So network failure is less likely. Then follows a period of financial safety.
But while slow and quiet might be safe—it’s also boring. Fast and loud is much more fun. The longer we feel safe, the bolder we get. Safety inspires confidence, which inspires complacency, which inspires recklessness. Whatever we invent to limit risk, we later use to take more risk, just as seat belts reduce deaths, but after a while we get used to them and just drive faster. So at some point, some of us always find ways around our last set of controls—or we forget what they were for. Then the smaller network cycle takes over again.
We thus keep ping-ponging between fear and greed at shorter or longer time scales. The problem isn’t too little of this or too much of that, but that we can get too out of balance—and when we realize it, like a herd of spooked cattle we all try to do the same thing at about the same time. The surprise isn’t that we crash all the time, but that we crashed so hard in 1929 that we then put up with two whole generations of boredom before we started to crash hard again.
We’ve gone through that big financial cycle over and over again, going back at least as far as China nine centuries years ago. That’s when we first issued paper currency to try to squelch inflation and counterfeiting. The particular market we’re risking our financial future on doesn’t seem to much matter. We’re ambling along until someone says: “Eureka! I’ve thought of a way to spin straw into gold!” And of course we believe them, because we all have straw but we all want gold. Suddenly we’re all buying tulips, er, sorry, dotcoms, um, no, collateralized debt obligations, oh wait, mortgage-backed securities and credit default swaps. All that really seems to matter is our mix of risk strategies—that is, in food-web terms, the mix of our ways of food-getting and baby-making—and the spottiness of our knowledge, or rather the depth of our ignorance, of the true mix of risk strategies in our network. Our core problem isn’t stupidity about finance but ignorance about networks.
But how is all that debt possible? Surely we can’t borrow more money than we have in total, can we? Actually, we can. Borrowing a thing suggests that it already exists. That’s true for shovels and cars, and even cash, but not money.
Cash (printed paper and coins) is physical, but money isn’t. Money isn’t cash any more than temperature is a thermometer; we just use cash (and other things) to measure it. Money is a claim of trust—it’s a trusted promise to pay a certain amount of value. We might accept the money (if we trust it) but what we want is the value, not the money (or the cash). And value is fluid; we no longer live in a static, ‘just-price’ world.
Values can change. In 1767, seamen from Britain landed in Tahiti, introducing metals to folks who had never known them. Those sailors soon found that a twenty-penny iron nail meant sex with a nubile girl. A nail is useful, even if we’ve never seen one before. We could pound it into a fish hook, or use it as a spear point, or other things. But once we had enough fish hooks and such, what could we do with more? So two weeks later, the price of sex had doubled. (Or, the value of a nail had halved.)
Further, when we borrow a lot of value—to buy a house, build a hospital, launch a rocket, fund a war—we may be borrowing from ourselves across spacetime. That is, we may be borrowing not just from each other around the planet, but also from ourselves in the future. We’re betting that tomorrow our capacity to extract resources from the planet, and to invent new tools for more goods and services, will be better—sometimes far better—than today. But what if it isn’t?
Finally, some assets, like volatile stocks, are so hard to value that we estimate their value by guessing at each other’s guesses about that value. That’s like being a judge in a beauty contest where instead of looking at the contestants alone, we also look at the other judges, trying to judge how they might judge. It’s no wonder that we sometimes misprice assets, especially really large or very fast-changing ones. Such assets might even be market-distorting, thus warping our financial spacetime.
So when we deposit cash in a bank and think that the bank holds it for us in a vault, or when we get a loan from a bank and think that the bank must have gotten it from a big pile of cash in a vault, we’re thinking of a piggy bank, not a real bank. In reality, when we deposit cash in a bank, all we’re doing is swapping the state’s IOU for the bank’s IOU.
So a bank, any bank, is a con game. It’s where we go to share in the illusion that safe, liquid, on-demand claims can meet requests that are anything but. It works only for as long as many of us don’t actually want our money. And we only ever begin to want our money if we ever begin to feel that we can’t get it.
Thus, our global network of financial institutions tries to manage an ever shifting, gossamer web of our own claims of trust on each other all over the planet and far into the future. Depending on how we feel about that web from moment to moment, it can expand—and like a pricked soufflé, without our trust, it can collapse. It’s a complicated confidence trick, and confidence is fragile. The slugs of shiny metal, or pieces of printed paper, or whatever, that spew out of it and into our pockets are merely the chits we use to mark our trust in it at the moment. They’re bits of data. They’re worth as much as we’re willing to dream they’re worth. And now and then we wake up.
A financial boom is more than a waking dream, though. If we were to accept that big cities are a little like life-forms, then it might make sense to think of the recursive networks that we build around money as somewhat like life-forms, too. If so, then there might be an analog for what happens during the frenzy of a financial build-up then collapse, namely: orgasm.
But whether or not that’s reasonable there’s a difference between what we do and what we think we do. When we buy a government bond that’s intended to cover a fiscal deficit, or a corporate bond that’s intended to build a new factory, we may think of it as a way to keep our money safe, and also to get some money as interest. But what we’re really doing is betting on the future. Ditto if we buy a stock, or a derivative (any bet on the future price of anything—a future, an option, a swap, and such). Ditto, too, if we start a company, bear a child, build a warship, devalue a currency, fund a Mars mission. Everything we do (or don’t do) involves a bet against the future. Mostly those bets are small and local, but lately they’ve been getting bigger and wider because they’re increasingly entwined in a global network, yet we can’t see all their spacetime links.
Today our financial systems, even in our poorest country, has merged into one financial network. So when we bet today, we’re gambling on the future with more and more of each other’s money, and we’re doing so faster and faster. That network isn’t getting any simpler, nor is its reaction speed getting any slower. Linking everyone’s bet to everyone else’s lets us do things that we couldn’t have done before. Global trade and global investment is thus now bigger and faster. That new linkage gives more of us more options, just as earlier linkage gave us steam engines and so on. But when it comes to money, with more of us more linked, and with those links getting ever faster, we’re losing financial diversity, not gaining it.
From 1929 to 2009, the United States stock market, the world’s largest, doubled in value every decade, and its trading volume doubled every 7.5 years. But in the most recent decade, that pace picked up: trading volume doubled every 2.9 years. Our financial networks are being driven more and more by our computers, and they’re acting and reacting not at our pace of hours or minutes but in milliseconds or microseconds. In 2010, the United States stock market misplaced nearly a trillion dollars—$862 billion—for about 10 minutes; then it found them again. Today, all our bets weave ever more of us ever more densely into an ever larger and ever more reactive non-linear network. That network’s rising density and speed means that a large-enough failure anywhere could lead to catastrophe everywhere—then perhaps even world war. Always having to edge around the non-elephant in the living room to get at the eats, we’re always making up stuff about the future, with little idea of what its real effect will be.
The Price of Life
Given all our tools, both physical and institutional, are we all going to get rich in our near future? Short answer: no. Long answer: noooooooooo.
Take South Korea and Ghana. In 1963, both countries were poor. Per person income in both was around $100 U.S. a year. By 2007, though, per person income in South Korea was about the same as in Israel and South Korea was our fourteenth richest country, making it about as rich as Canada. Ghana wasn’t. How did that happen?
In the early 1960s, most of us in South Korea were peasants. We had just been through a proxy war fought mainly between the United States and China. Plus, we had earlier been occupied by Japan for 35 years. Most of our cities and railroads were destroyed. A military dictator ruled. Foreign aid made up half our national budget. We were starving. Then in the late 1960s, we had a windfall—a huge retail demand spike from the United States, caused mostly by a retail explosion, led by big buyers like Wal-Mart and Nike. That was mostly caused by two things. First, computers in the United States got cheap enough to enter the business value chain. Second, a new transport tool, the shipping container, began to lower the cost of international trade. So, big retailers in rich countries could farm out their supply chains to cheaper labor overseas. And we, being on the far eastern rim of Eurasia, were easy to reach,
In South Korea—where failing economically might mean invasion from North Korea—as demand for our labor rose, we decided to copy Japan’s recent meteoric rise. In stages, we shifted to more export-oriented businesses—first steel, then ships, cars, construction, electronics. From 1970 to 1973 alone, our exports to the United States tripled. So when our baby boom happened—caused by changes in our rural health tools—our kids had new job choices in our cities. Millions of us scraped the farm’s mud off our clogs and our cities exploded. From 1960 to 1990, our urban proportion jumped from 28 percent to 74 percent. Our per person income doubled every 11 years. Our life expectancy shot up from 58 to 70 years. Our numbers grew from 25 million to over 43 million. Foreign demand then leveled off, but our new toolbox was by then already dense enough and diverse enough to turn stigmergic. That new toolbox, and the new attitudes toward the future that it fostered in us, supported us in our new state. Our incomes kept growing.
Similarly, in Japan in 1945 we had just been nuked, and were occupied by the United States. Jobs were few, trade was low, inflation was high. We were starving. However, by 1950 and the start of the Korean war, the United States needed weapons and supplies, and even though we had earlier occupied Korea, we were the nearest possible suppliers. That led to a windfall. First, we simply turned back into weapons makers. But then, instead of returning to cheap goods—footwear, textiles, toys, bikes, and the like—we looked for a foothold in richer markets, turning to export-focused consumer goods, climbing a ladder of: cameras, radios, TVs, fridges, washing machines, motorbikes, cars.
At first we couldn’t make such things well, so—like the United States in the early 1800s—we learned from books and imported, copied, or stole tools and ideas. We also had few resources, so we imported those and exported goods. As a poor island with few friends, we fell back on our old motto: ‘Export or Die,’ much as England or the Netherlands had in the 1600s when facing the powers of the time—Spain, then France. We had started into our industrial phase change back in the 1870s, so we built up our schools and, working together—from firms to whole industries—we used any profits to focus our industrial inheritance on export-led heavy industries, starting with ships. By the early 1960s and the end of the Korean war, we overtook Britain to become the world’s biggest shipbuilder. The United States let us go on to compete for industries—like steel and electronics—that it had dominated, as it preferred to arm wrestle the Soviet Union for world supremacy. For the same reason, we also got to avoid spending serious money on our military.
Meanwhile, in Ghana, unlike in South Korea (or Japan), we stayed much the same from 1965 to 2007. For one thing, there was no Cold War foe for us to be a proxy for. We were on the far western rim of Africa, but no rich country much cared—until we discovered oil, and that only happened in 2007. Starting with fewer literates, a far smaller school system, and no real trade links to the United States (or Japan), our firms were far less export-oriented. So by 2007, our per person income was over 17 times smaller than South Korea’s.
However, while in Ghana in 2007 we were poorer than in South Korea, we were richer than in North Korea, which by then was 33 times poorer than its previous equal, South Korea. By then, in North Korea, we were mostly still peasants. We were also around three inches shorter and 20 pounds lighter than we were in South Korea. Further, by 2010 in South Korea, we were 83 percent urban. Half of us lived in Seoul. More of us lived there than lived in all of North Korea. However in North Korea, only one in seven of us lived in Pyongyang.
But in both South Korea and Ghana it wasn’t just what we traded since the 1960s; it was also who we traded with. In South Korea, instead of mostly trading with our biggest neighbor—China—by 2010, we traded with richer or farther partners like Japan, the United States, and Britain. (As China gets richer we’re now moving back the other way.) That’s something else that controls whether one of our countries can get rich: its trade network.
Just as we as individuals can move from firm to firm, and our firms can move from city to city, our countries can move, too. They’re just bigger and slower. They can’t move in physical space, but they can, and do, move in ‘trade space.’ Normally, distance strongly determines trade partners. A ten percent reduction in ocean distance between two of our countries means roughly a five percent increase in trade between them. But our countries can also seek larger returns for their products by changing who they trade with.
In 1913 half of Australia’s exports went to Britain, and about half its imports came from Britain. By 2006, though, it mainly traded with nearer or richer neighbors: China, Japan, the United States, South Korea, and Singapore. Similarly, Israel traded with distant rich countries—like the United States, Japan, and Europe—far more than its nearer but poorer neighbors: Lebanon, Syria, Jordan, and Egypt. Yet again: Brazil shares borders with Argentina and nine other countries. But—besides Argentina—its main trading partners were: the United States, Germany, China, Japan, and the Netherlands.
So whether, and how fast, one of our countries can get rich depends on many things: its history, location, resources, inherited toolbox, trade network, how big its cities can grow and how fast, and so on. Some of that we can control, and much we can’t. But of what little we can control, the growth rate of our tools and trades and cities and such depends on our attitudes toward the future, which can affect how many kids we have. Over time, that can influence whether we get rich or stay poor.
Here’s why: How many kids we choose to have can depend on the future labor value of those kids. Are they a good investment or not? That depends on at least four things: What’s the female opportunity cost of bearing them? What’s the chance that they’ll die young? What’s the cost of raising them? And what’s their likely adult income?
In the rural parts of our poor countries, female income is low, child death rates are high, school costs are high, and the chance of a high-paying job is low. Thus, our children’s future labor value is low. However, because female income is low, our children’s expected cost is also low—if we put them to work on the farm instead of sending them to school. We thus make many kids, many die young, and few get schooling. They then grow up to face the same math problem.
In such a world, our numbers are high, our tools few, our incomes low. So both energy and land cost a lot. Tools are expensive, so we only have a few—they take costly energy and skilled labor to make and maintain. Transport, too, is costly—it takes energy. So trade is low. Thus we don’t divide our labor to specialize a lot. So our skill levels are low—that is, most of us are manual laborers. So our labor is cheap and plentiful—but it’s also scattered, rural, and unskilled. So we can’t easily amass money to buy tools, transport, energy, or land. We thus try to maximize labor and minimize land, energy, tools, transport, and trade. So stability is high and mobility is low. Most of us work the land, and our farms and villages have to be small and self-sufficient. Our children, when viewed as an investment, are like our farm animals. The result is hand-to-mouth farming.
That’s a stable state for us. It’s pretty much the life that nearly all of us lived for millennia. By 2006, 45 percent of us, including most of us in our now rising, but still poor countries, like Ghana, still lived that way.
However, if the right things happen in the right order, our children’s future labor value might rise, in which case all the above might go non-linear. For example, put in sewers and piped water and we might start saving money. Why? Because more of our kids survive childhood, plus we begin to expect to live long enough to retire on their future labor. Add vaccines and mosquito nets and we might start sending more of our kids to school. Why? Because more of them reach school age and we have more money to send them there. Add cheap rural schools and free birth control and our cities might grow. Why? Because we make fewer kids, but of those, we send more to school, so more of them have a chance at higher incomes in our cities—to which they promptly flee.
As we make fewer kids, and as more of them go to school, then stay in school longer, as adults they flee to cities and earn more, so we’re better insured against old age or illness. But they also cost us more to raise, so we start saving even more. Further, as more of them survive childhood, we stop making as many. Our ratio of working-age (15-64) to non-working-age (0-14 and 65+) then rises. So our average labor value then rises. We get richer. If we then begin to feel that today is better than yesterday, we might start thinking that tomorrow might be better than today. If so, we make even fewer kids and start saving even more.
But just because that might happen doesn’t mean it must happen because whether it happens or not also depends on where we are when we start.
From 1960 to 2000, spreading medical tools touched off baby booms in both East Asia and sub-Saharan Africa. In East Asia, as our boom matured, our ratio of working-age to dependent-age rose from about 1.3 to over 2. That alone likely caused big hikes in our incomes. (In 1996, that age ratio was 0.7 for poor countries, 0.6 for middling countries, and 0.5 for rich countries.) In sub-Saharan Africa, though, we started with low life expectancy and many kids per working-age adult. Our first baby boom led to another. Then another. So when our first boom reached maturity, our ratio of workers to dependents remained unchanged. Also, AIDS reduced our working-age numbers, which further reduced that ratio. Thus, the cost of our kids remained the same. We came to expect tomorrow to be like today—except perhaps worse.
If we do manage to keep up our changes for long enough, though, our local network might start to change ecogenetically: we would no longer have to do what we’ve always done, and our kids would no longer have to go as we’ve always gone. If so, the cards would remain the same, but suitable hands of cards could change. Humus could deepen and shrubs, then saplings, could sprout where before only grass could grow.
If we have the time to build new tools and trade networks and savings before the next forest fire or landslide or big storm, that could keep the cycle going. The cost of our kids compared to their future labor value then rises. Our new tools then cheapen and spread, our cities grow, and our trade networks shift. Investment in the future might then rise. Schools spread; roads spread; tools spread. City jobs diversify, and they pay more—so we compete harder for them, so skills rise. As schooling and opportunity rise, more girls go to school—and, 15 to 20 years later, they have fewer kids.
Having more money and fewer kids needn’t make life easier, but it does make it different. As more women become wage-earners, demand for daycare and schooling rises. As those costs, plus medical costs, rise, kids cost even more. Plus, since they no longer die as young as they used to, making lots of them stops making sense. So our next generation makes even fewer of them. As more women both earn wages and learn to read, they make even fewer kids and thus are healthier and less home-bound. As more of them leave home and both learn more and earn more, the opportunity cost of one more child rises yet more. Thus, ever more women stop being baby-machines.
So birth rates fall. City sizes rise. Lifespans, average age, average wage, amount of schooling, all rise. As family sizes fall, savings and investment rise; trade barriers lower; women gain power; kids go to school, not work; and adults live more off their brains than their muscles. If we can keep that up for long enough—surviving external shocks and internal squabbles—we stabilize at higher income levels and lower birth rates.
That’s also a stable state for us. It’s pretty much the life that all our rich countries, including South Korea, lead today.
Much the same thing seems to have happened to Britain, although the circumstances were different. As tools and trade and schooling spread there, energy (from coal) grew cheaper. With new tools and cheaper energy and more trade, cities grew. Britain was 25 percent urban in 1800, 50 percent by 1850, 77 percent by 1900. Already by 1876, synergetic and stigmergic lock-in had sealed its fate. Its birth rate then peaked, and by 1909 had already shrunk by 30 percent. It had phase changed from one of our stable states to another. Britain took 100 years to do that; South Korea did it in 30.
So wealth phase change can happen—but it’s tricky. The right things have to happen in the right order at the right time, all conditional on initial conditions. If vaccination comes in at the wrong time, or if schools aren’t cheap enough, or don’t spread fast enough, or if cities don’t grow quickly enough, or if trade isn’t plentiful enough, nothing may change for thousands of years.
How then do we get rich? Well, that seems to depend on many things, among them our toolboxes, our city sizes, our trade networks. Those depend on accidents of geography and history. However, several of those pieces of the jigsaw puzzle of wealth phase change seem to come down to one thing more than any other: how much they affect the cost of our kids. Nor is that some new thing we’ve just discovered. The same was true when we began phase changing from foraging to farming 12 millennia ago. Possibly the same thing will still be true in our future. Change the price of life and we change the world.