Ridley’s Take: Part 1

Matt Ridley’s superb new book on How Innovation Works that I touted here before publication is now on its way to best seller lists in the United States.

A former editor of the Economist magazine, now a British Viscount in the House of Lords, and the world’s shrewdest and most unflappable critic of the climate change cult, Ridley believes that innovation is nothing less than the central human activity.

He declares How Innovation Works “my best book.”

That’s a grand claim in the face of the blazing originality and poetic concision of Genome, the detailed historical and analytic mastery of The Rational Optimist, and the broad technological insight of The Evolution of Everything.

But let’s agree that his current opus consummates the arguments in his previous works and adds a series of provocative but imperative new insights. For example, everyone involved in technology and investment policy should absorb his cogently mounted and historically authoritative case against the existing patent system.

From James Watt’s steam engine patent, which delayed the use of his technology for 20 years, to the current maelstrom of legal tricks and trolls in patented technologies, Ridley shows that patents reliably retard the process of innovation.

In the two core disciplines of information technology, semiconductors and software, patents are scarcely used at all. A 17–year–monopoly for incremental advances that can become obsolete in months would bring innovation to a halt. As a result, the world’s leading innovators shun the patent system. Chip manufacturers all pool their patents and trade them off in a kind of guild, while, from Linux to Apache, software companies now mostly use codes from the open source movement.

Although Ridley concedes that some kind of protection is needed for pharmaceuticals that cost $2.8 billion over eight years on average to shepherd through the Federal Drug Administration, in general, 17 years of exclusivity and litigation inflicts a blight on the use of inventions.

Ridley quotes a suicide note from Rudolf Diesel, who invented the engine that runs the world today, from trucks and tractors to cargo ships: “The introduction [of an invention] is a time fraught with combating stupidity and jealousy, inertia and venom, furtive resistance and an open conflict of interests, an appalling time spent battling with people, a martyrdom to be overcome, even if the invention is a success.”

Spurring Ideas in the Daily Prophecy

How Innovation Works may not be Ridley’s best book, but it is a masterpiece of business and technological history, refulgent with crucial insights covering the entire range of industrial progress. In future prophecies, I will be citing it frequently and debating it at times.

In The Rational Optimist, Ridley expounded his central philosophical themes. In an article from a decade ago in National Review, I set the scene:

“In a castle in Newcastle, complete with reflecting pool, dappled woods nooked with marble sculptures, and pastures lowing with cattle, Matt Ridley, dean of British science writers and author of four erudite Darwinian bestsellers, might seem an intellectual grandee ready for an honorable, bland retirement in a North Country Eden… 

But at the end of his lawn, invisible throughout a leisurely walk down its length, is a vast and amazing surprise that offers a vivid portent of this new Ridley book: a tome as unexpected and as ambitious and as contrarian as a massive coal mine under an environmentalist’s lawn. Far below, a visitor can descry the tractors and extractors crawling around in the dirt like yellow–jacketed ants. And like the Ridley mine, this book, The Rational Optimist, is a trove of readily combustible fuel…”

At a time when the world is embroiled in the self–defeating safety–first lockdowns for COVID–19, Ridley offers a devastating critique of an excessive caution that would bring innovation to a halt.

Cogently showing that the environment faces no threat so dire as environmentalism itself, he spurns the ‘precautionary principle — better safe than sorry’ as self–refuting: ‘In a sorry world there is no safety in standing still.’ In a typical aperçu dramatizing the benefits of economic advance, he comments, ‘Today a car running at full speed emits less pollution than a parked car of 1970 [did] from leaks.’

He begins with a fruitful comparison between two similarly shaped artifacts on his desk: a cordless computer mouse and a million–year–old Acheulean hand axe. “Both are designed to fit the human hand — to obey the constraints of being used by human beings. But one is a complex confection of many substances reflecting multiple strands of knowledge. The other is a single substance reflecting the skill of a single individual.”

“The difference between humans and other animals, he writes, ‘cannot just be that I have a bigger brain. After all, late Neanderthals had on average bigger brains than I do.’ The stone axe ‘was invented in the Paleolithic period, spread widely, yet never improved significantly over the subsequent million years while the hominid brain enlarged by one third.’ Over eons of hominid history, biological evolution was many times faster than technological evolution.

He continues: “No single person knows how to make a computer mouse. The person who assembled it in the factory did not know how to drill the oil well from which the plastic came, or vice versa. At some point, human intelligence became collective and cumulative [through interdependent trade and exchange] in a way that happened to no other animal.”

Conversely, economic independence produces decline: “Self–sufficiency is poverty.” With exchange, consumption could diversify while production specialized. But protectionism or parochialism reverses the process.

More on this in tomorrow’s Daily Prophecy…


George Gilder
Editor, Gilder’s Daily Prophecy

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