The Fifth Industrial Revolution is Happening - Is it Time to Reshape Our Future? | Summit 2018

Summary

The speaker argues that we are at a pivotal moment in history where smart green growth is essential for both environmental and social sustainability. Drawing from historical examples of technological revolutions, the speaker highlights that we are midway through the current digital revolution, with the opportunity to shape the future. The speech emphasizes the importance of new lifestyles, government action, and the need for socially equitable, green innovations that can lead to a global golden age. The key message is that change is possible but requires collective effort from business, government, and society.

Takeaways

• 🌍 We are living in challenging times, but these challenges offer a unique opportunity to make real changes.
• 📈 Smart green growth is the best option for a socially and environmentally sustainable future.
• ⏳ We are at a critical juncture in history, where technological revolutions allow us to shape the future in profound ways.
• 🔄 The world has experienced five major technological revolutions, and we are currently halfway through the fifth—focused on information technology and telecommunications.
• 🚀 Each technological revolution brings a leap in productivity across all industries, including raw materials, manufacturing, and services.
• ⚖️ Historically, there is a pattern: first finance leads, then production, followed by a golden age of growth. We are at the turning point between finance and production.
• 💰 A golden age of sustainable growth is possible, but it requires strong governance, state intervention, and a shift in market priorities from finance to production.
• 🏙️ Technological revolutions not only drive economic changes but also bring about new ways of life, such as the suburban lifestyle in the mass-production era.
• 💡 Smart green growth involves de-materializing GDP, focusing on services over products, and improving natural resource efficiency.
• 💼 A shift in lifestyle towards green living will create new jobs and industries, but this change must be driven by aspiration, not guilt or fear.

Q & A

What is the speaker's main argument in the transcript?

The speaker argues that we are at a pivotal moment in history, a rare opportunity for shaping the future through 'smart green growth,' which is not only environmentally sustainable but also socially sustainable.

Why does the speaker believe now is the right time for change?

The speaker believes the current time is ripe for change because historical patterns show that after technological revolutions, there comes a 'turning point' where production can shift towards creating a sustainable and prosperous future.

What are the five technological revolutions mentioned by the speaker?

The five technological revolutions mentioned are: (1) the Industrial Revolution, (2) the Age of Steam, Coal, Iron, and Railways, (3) the Age of Steel and Heavy Engineering, (4) the Age of Automobiles, Oil, Plastics, and Mass Production, and (5) the current Age of Information Technology and Telecommunications.

What does the speaker mean by 'smart green growth'?

'Smart green growth' refers to a type of economic growth that uses information and communication technologies (ICT) to boost productivity while also being environmentally sustainable, with a focus on reducing inequality and improving social sustainability.

What historical patterns does the speaker use to explain the current moment?

The speaker explains that technological revolutions follow a pattern: an initial 'installation' period, followed by a financial bubble, a recession, and then a 'golden age' of prosperity. The speaker believes we are currently at the turning point between finance-led growth and production-led growth.

Why is the state important in achieving a golden age, according to the speaker?

The speaker argues that the state is crucial in tilting the playing field toward social good. The state must actively shape markets so they align with business and societal needs, rather than relying solely on markets to self-regulate.

What parallels does the speaker draw between the present day and the 1930s?

The speaker draws parallels with the 1930s, noting similar challenges like structural unemployment, inequality, low investment, social unrest, populist leaders, and economic stagnation, all of which signal the need for a major societal and economic shift.

How does the speaker view the role of new lifestyles in economic growth?

The speaker believes that new lifestyles are essential to creating demand for new products and services, which in turn drives job creation and economic growth. Each technological revolution has historically led to the emergence of new lifestyles that reshape economies.

Why does the speaker oppose the concept of 'degrowth'?

The speaker opposes 'degrowth' because they believe that stopping economic growth is not a solution to inequality or environmental issues. Instead, they advocate for 'green growth' that shifts towards sustainable industries and services while addressing the needs of the global population.

How can 'smart green growth' provide solutions to both environmental and social challenges?

'Smart green growth' can solve both environmental and social challenges by promoting innovation that enhances productivity, reduces resource use, and provides a good quality of life for all. It encourages green technologies, sustainable industries, and services that align with global aspirations for a better, more equal society.

Outlines

00:00

🌍 The Opportunity for Change

The speaker highlights that despite the challenging times, this is a unique opportunity for profound change. They argue that smart green growth is key to a socially and environmentally sustainable future. The talk will address why now is the time for action, the role of smart green growth, and why lifestyle changes are crucial. The speaker draws on historical examples from past technological revolutions to emphasize the significance of the current moment, noting that we're in the middle of the information technology revolution, a time that offers immense possibilities.

05:01

🔄 The Historical Cycle of Technological Revolutions

The speaker explains that technological revolutions follow a predictable pattern: an installation period, a turning point, and a deployment period that leads to a golden age. They cite past examples, such as the Victorian boom and the post-war Golden Age, to show how technological shifts have shaped economies and societies. We are currently at the turning point in the information technology revolution, which could lead to a sustainable golden age if we shift focus from finance to production and societal needs. However, if this opportunity is missed, the world may face continued instability.

10:01

💡 The Role of the State and Lifestyle Changes

The speaker argues for an active role of the state in shaping markets towards social good. They stress the importance of lifestyle changes that emerge with each technological revolution, citing the suburban lifestyle of the mass-production era. The state can guide this by promoting innovation and shaping demand, which will in turn influence supply. Reducing inequality and fostering a green lifestyle that promotes sustainability are key to creating new jobs and ensuring long-term growth.

15:02

🌱 Smart Green Growth: The Path Forward

The speaker advocates for smart green growth, rejecting ideas of 'degrowth' as impractical given the global need for development. Smart green growth leverages information technology to drive productivity, innovation, and sustainability across industries. By increasing the role of intangibles in GDP and focusing on a circular economy, growth can become more sustainable and inclusive. Lifestyles play a crucial role in this shift, as new ways of living create demand for sustainable products and services. The speaker highlights the importance of policies that support innovation in green industries and make sustainable living desirable and accessible.

Keywords

💡Smart Green Growth

Smart Green Growth refers to the strategy of fostering economic growth that is both environmentally sustainable and socially equitable. In the video, the speaker emphasizes that smart green growth is the best option for creating a future that supports both technological progress and social well-being, contrasting it with older models of industrial growth that caused environmental harm and social inequality.

💡Technological Revolutions

Technological Revolutions are major shifts in technology that drastically change industries and society, such as the Industrial Revolution and the Information Age. The speaker discusses five historical technological revolutions, each characterized by new technologies like steam power or digital communication, and explains how we are currently in the fifth revolution—the age of information and telecommunications.

💡Turning Point

The Turning Point is a phase in the lifecycle of technological revolutions where society shifts from finance-led growth to production-led growth, laying the foundation for a golden age of innovation and prosperity. The speaker argues that we are currently at such a turning point, where action can shape the future of production, social equity, and environmental sustainability.

💡Golden Age

A Golden Age refers to a period of widespread prosperity and innovation that follows a technological revolution. The speaker suggests that we are on the verge of a potential sustainable global golden age, but only if we successfully shift from finance-dominated growth to production-driven development, with government and society playing active roles in shaping this future.

💡Social Sustainability

Social Sustainability involves creating systems that support long-term social equity, including fair job creation and reducing inequality. The speaker highlights the need for economic models that not only focus on environmental sustainability but also provide a 'good life' for all, emphasizing the creation of jobs and new lifestyles that are both environmentally and socially responsible.

💡Intangibles

Intangibles refer to non-physical products and services, such as digital goods, intellectual property, and services like software and consulting. In the video, the speaker discusses how smart green growth will lead to an increasing proportion of intangibles in both GDP and lifestyles, helping to 'dematerialize' the economy and reduce environmental impacts while fostering innovation.

💡Lifestyles

Lifestyles in the context of the video refer to the everyday behaviors and consumption patterns of individuals and societies. The speaker stresses the importance of shifting towards a 'smart green lifestyle' that aligns with environmental goals, such as recycling, using renewable energy, and choosing sustainable products. These shifts are crucial for creating demand that drives green innovation and economic growth.

💡Casino Finance

Casino Finance is a metaphor for speculative financial activities that prioritize short-term profits over productive investments. The speaker criticizes the dominance of casino finance in the current economic system, arguing that a shift towards production and real investment is needed to build a sustainable future and achieve a golden age.

💡Dematerialization

Dematerialization refers to the reduction of material inputs and physical resources used in production and consumption, replaced by services, digital goods, and higher efficiency. The speaker promotes dematerialization as a key aspect of smart green growth, enabling economic growth without exhausting natural resources or worsening environmental degradation.

💡New Lifestyle

A New Lifestyle is a social shift toward behaviors and consumption patterns that support green growth and sustainability. The speaker argues that every technological revolution has led to new ways of life, and for this current revolution, a smart green lifestyle—based on sustainability, minimalism, and high-tech innovation—is emerging as the desired aspiration for the global population.

Highlights

We are living in difficult times, but this is a rare opportunity to make real change that may only come once or twice in a century.

Smart green growth is the best option for a socially sustainable future, addressing both environmental and social sustainability.

The fifth technological revolution—our current revolution—presents a moment of transformation where we can shape the future profoundly.

Historical experience shows that we are at a critical juncture where society can shift from financial dominance to a production-led economy.

Previous technological revolutions have reshaped society, such as the Industrial Revolution and the age of steam, leading to global markets and changes in national rankings.

The current revolution, driven by information technology and telecommunications, offers opportunities for innovation and leaps in productivity across all industries and sectors.

Technological revolutions follow a regular pattern: eruption of technology, financial bubbles, recession, and then a golden age of prosperity.

We are at the turning point where we can move towards a sustainable golden age, but this requires curbing the dominance of finance and focusing on production and societal benefit.

The conditions we are living through resemble the 1930s, with structural unemployment, inequality, and populist leaders exploiting economic and social frustrations.

A global sustainable golden age is possible, but it requires governments to actively shape markets for social good, alongside the emergence of a new lifestyle.

The new green lifestyle will not spread by guilt or fear but by desire and aspiration, much like the spread of suburban and cosmopolitan lifestyles in past revolutions.

Smart green growth emphasizes a shift towards dematerializing GDP and lifestyles, focusing on services and circular economy rather than mass production.

Technological revolutions destroy old jobs and skills but create new ones through new lifestyles that demand new products and services.

The shift to a smart green lifestyle has already begun among the elite, the highly educated, and the young, and it will eventually spread to the mass population.

Active policies are needed to turn environmental problems into social and economic solutions, making green innovation the most profitable path forward.

Transcripts

[Applause]

hello everybody

we are living in terrible times and yet

this is the best opportunity we've had

in a long time to make a real change

now everybody who's here obviously

agrees with making the change but you

could also feel that it's difficult that

it isn't going to happen soon that it

isn't going to happen right well my

message today is about my understanding

of the specific moment we are living

this is an opportunity that only comes

around about once maybe twice a century

so this generation has the opportunity

to shape the future seriously profoundly

that's what I'm going to argue today so

smart green growth is our best option

for a socially sustainable future I'm

not just talking about environmentally

sustainable I'm talking about both it is

also socially sustainable and obviously

we need it to be socially sustainable so

this is going to be my understanding

from my studies of the history of

technological revolutions three

questions why now quite precisely smart

green growth and one that's very

important why our lifestyles so crucial

in this issue why now now because

historical experience shows that we are

at the appropriate juncture for shaping

the future so this is the moment how do

we know that because there have been

five technological revolutions this is

the fifth so we have enough historical

material to find out where we are

and what has happened in previous

occasions so let's look at the

revolution so we have the first one

everybody knows the Industrial

Revolution machines factories canals

after that from about 1830 we had the

age of steam coal iron and railways

which together with the Telegraph was

the Internet of the time after that

around 1875 we have the age of steel and

heavy engineering electrical chemical

civil naval but mainly something very

important it was the first globalization

so we can learn a lot from that one it

was the time when thanks to steam ships

which replaced sailing ships of course

we were able to have north/south trips

to bring food to the north and therefore

we had this first global market and we

also had something that we're having now

which is the development of countries

that had been left behind before so we

had the whole of Australia New Zealand

South Africa until etc and the US and

Canada and so on forging ahead Germany

also forging ahead in that particular

period so it also makes changes in the

organization and the ranking of

countries that's what technological

revolutions bring so then we have the

fourth revolution the age of the

automobile oil plastics and mass

production that's the one we're trying

to deal with that's the one that's for

all the problems but at its time it

brought all the solutions it was

wonderful we had the post-war boom when

we come to the fifth to our current

revolution the age of information

technology and telecommunications now

the reason why that arrow is only half

way is because we're only half way along

and that's precisely what this talk is

going to be about why is it that when

you're half way along you have all the

possibilities for shaping the future so

each of these revolutions brings the

techno economic and social institutional

shift so it can change practically

everything

because it changes common sense you

wouldn't build a bureaucratic pyramid

now if you do an organization you do a

platform you do a network it's just a

different way of looking at things and

of course the digital natives find it

fantastic some of us find it a bit more

difficult but we're learning so what it

provides are new directions for

innovation and the potential leap in

productivity but not just in all those

software things we're talking about

relief in productivity in every single

sector including raw materials every

industry every activity every social

activity every business activity has a

leap in productivity thanks to the

technological revolution but this is

where the important thing comes it's how

we know that this moment that I'm

telling you is the moment it's because

the historical record shows a regular

pattern of propagation we have first an

installation period then something that

I call the turning point which is when

you go from finance to production and

then a deployment period which is the

golden age so we have eruption of the

technology bubble prosperity a recession

a golden age prosperity and then

maturity imagine to discover that this

is the order of things when we have we

had canal mania and after that we had a

short period and then the great way to

sleep Railway mania rail railway panic

and then the Victorian boom the London

funded global booms all over the

southern hemisphere and then after the

crashes the Belle époque then the

Roaring Twenties and then the crash of

29 and then a long period of recession

and war etc until you have the post-war

Golden Age and now we had two bubbles

the dot-com boom that crashed in 2000

the global casino the truck that crashed

in 2008 I wouldn't be surprised

unfortunately if we have a third crush

but anyway what we could have ahead is a

sustainable

robell Golden Age not just in the

advanced countries of the West as it

used to be called but in the whole world

it's possible now the first half is led

by finance we know very well we've been

led by finance all this time and they're

still leading us unfortunately the

second half is led by production and

state there is no way we'll ever have a

golden age just by letting markets we've

got to shape the context so that markets

act in the direction that is a positive

sum game for business and society if we

don't do that we're going to continue

stumbling and stumbling possibly with

more more populist desperation and all

sorts of other things so where are we we

are precisely at that turning point we

are at the point when we can have a

golden age ahead but we need them to to

control finance so that it starts

working towards production and the and

and society and the whole economy and

not just this financed financing

financed in a casino now we need to

understand the nature of the turning

point it's us in the 1930s that's what

we're living it's the equivalent of the

1930s so what do we have structural

unemployment this killing of lots of

people hopelessness inequality casino

finance low investment feeble growth

social unrest populist messianic leaders

with growing following more and more the

more they offer heaven the more people

want to go with them and we know they

can't do it but how can we prove it well

they'll prove it themselves not

achieving it but anyway xenophobia could

be the Jews it could be the Muslims it

could be the Mexicans whoever it is

somebody's got to be blamed and

therefore it ends up being the weak

economic migrations

talk of secular stagnation the first

time it was ever used by

was in the 30s recessions even

depression so it's a pretty ugly time

but we've been there before the thing is

that there is a huge underlying

technological potential that simply

lacks a clear synergistic direction a

direction where everybody will start

moving and then advance towards that

better society towards a global

sustainable golden age so that is why

this is the historical moment for

government to come back actively and

knowing it which way to go and we need

to have consensus in order to do that

and of course we're very far from that

now the direction for golden ages is

defined by two features one is an active

state tilting the playing field you know

this whole thing about the even playing

field it's gotta be an even playing

field okay so it's the same for

everybody but tilted towards social good

so same for everybody that's not in

question the question is does it have to

be nothing just keep your hands out I

think we heard Mariana explaining this

the ones who were here that it really

makes a huge difference if the state

does what it has to do the other thing

that we hardly ever talk about is that

we really also need the emergence of a

new lifestyle and it's got to be

promoted and it's got to be helped you

know how many things happened in order

to get the lifestyle of the

mass-production era the suburban

lifestyle the couple with two kids where

the wife stayed at home and was the

factory of the home and then the guy

went out and made the money and then

came back and then they had the TV

dinner and I'm the Saturday plank movie

staying's everything but also funny made

you know what Fannie Mae was it was a

way of government guaranteeing for the

banks to lend to people who were

salaried employees so the banks would

there so everybody

goodbye a cheap house on cheap land in

suburbia because they could now have a

car so the whole thing was all and of

course the welfare state unemployment

insurance and all the all the list so

all those things were very important

because that way of life is what gave

the market for all the innovations that

came and that's what we've got to do now

about green anyway so what does this

paid to it provides a clear path for

profitable innovation it provides

sufficient dynamic demand because if you

shape the demand you're also shaping the

supply you're also shaping innovation

you're saying in which direction so if

you make the man more green you will get

more green product and of course the

reduction of inequality it is absolutely

unacceptable that we are living in this

world where there is so much inequality

with so much wealth so that's a

responsibility and the new lifestyle

well it's about two things in

aspirational good life a new jobs to

cater to to cater for it or to cater to

it now both these things determine the

level of growth and of job creation so

now why smart green growth first of all

growth I am completely against all this

D growth silliness are you crazy

we have millions of hungry people all

over the world so you're gonna stop

growth because the rich are too rich no

well the problem is what grows because

you can have green grass and green

growth doesn't doesn't have the same

problems you know what these people who

are asking for D grows and no growth and

back row stand on grows on whatever else

they are really just in the mass

production world and they think that

growth is about mass production it's not

it can't be about anything it can be

about services completely intangibles

and so on and we're now going to look

why-why-why smart green growth because

it's the tie

direction we need now one that takes

advantage of the potential of ICT

because information technology is the

technology that now makes us powerful we

take advantage of it for productivity

global development and intangibles

we need a direction that opens

innovation paths for all industries and

activities not just for the ones that

are up there growing fast but for every

single industry and activity including

our personal activities we need one that

enables a good life for all within the

boundaries of the planet and that is

already a clear trend in business and

social behavior everybody who's here is

part of that trend the trend all is

already there we just have to make sure

we have a way of accelerating it now

let's define a little bit what is smart

green growth it's a constant increase in

the proportion of intangibles in both

GDP and lifestyles so we are D

materializing GDP and D materializing

lifestyles we are doing circular

economic and service economy so we're

talking about shifting to services

rather than products and multiplying the

productivity of natural resources now

why are lifestyles so crucial why do I

insist so much on the lifestyles issue

apart from the fact that of course I've

seen it in history social sustainability

implies jobs for all so technological

revolutions destroy jobs destroy skills

destroy regions we know it well we've

been seeing it and that's why there is

all this populist thing happening

because people have seen their jobs and

their skills and their regions

deteriorate and be lost but the needs of

the new lifestyles create the new

employment and that's how it has always

happened and of course we also have to

worry about the welfare the safe in

safety net that we would provide for

those lifestyles but anyway we had the

suburban American Way of life

we had the cosmopolitan life of the

Belle époque and we had the urban

Victorian lifestyle that's when the

first time the cities really grew

enormously and of course they required

construction and lots of products each

revolution enables a different way of

life that requires multiple new services

and products and what is a smart green

lifestyle well it's the new good life

for the global Information Age Green

will not spread by guilt or fear it's

going to spread by desire and aspiration

so it's got to be the good life that

everybody wants to have it and smart

smart because it's the natural direct

direction of the digital revolution and

it's also the most intelligent choice so

it's also smart in that way now

I said before that you don't push

something that's not moving you don't

accelerate something that doesn't exist

well we know that the smart green shift

in lifestyle has begun as always at the

top of the income scale at the top of

the education scale and among the young

that's how it's always happened so we

don't have to worry about it being an

elite thing elite things become mass

things when they spread enough when they

grow enough to become really both

low-cost and desirable because people

copy those things of the elite

eventually so we now have already

naturally instead of synthetic

minimalist design gourmet and organic

food working from home active and

creative prosumer instead of passive

consumer exercise for wellbeing accent

on health and caring cycling and extreme

sports solar power as luxurious as well

as electric cars intense use of Internet

of course anti waste Pro recycling high

quality instead of quantity

customized rather than standard services

rather than

jebel products access or rental instead

of possession we could have a whole

reuse and maintenance industry instead

of waste we need active policies to make

all that the most profitable direction

to innovation so it's the right time to

turn what we now see as the

environmental problem into the urgently

required social economic solution not

just environmental it's the social

economic solution but we will only

succeed if we all work together business

government and society thank you

[Applause]