Economist Tyler Cowen who predicted in 2009 that a) The U.S. will have slow growth until the 2040s because “the low hanging fruit has been picked”* and b) there will be no medical breakthroughs before 2030.
Recently, Cowen was interviewed on a podcast where he discussed how complacent America has become and mentioned the Manhatten Project and the Appolo Mission and that current bureacracy would make both impossible today. Here are some errors I responded to on his Marginal Revolution blog:
1. Tyler Cowen: “Compare that to the 1920s when there were incredible revolutions in communication: radio, telephone, later the television.”
The telephone was invented decades before it took off and was still owned by just 15% in 1920 and 20% in 1929. The radio went from 0% to 15% in the 1920s and the television wasn’t on the radar until the early 1950s. Diffusion rates of personal computers, VCRs, DVD players, the internet, broadband, MP3 players, cell phones, smart phones, facebook and the ipad have been much quicker.
2. “The Manhatten Project cost several percentage points of GDP at its peak.”
The Manhatten Project cost $2 billion (nominal) over 4 years. The GDP then was around $200 billion (nominal) so around 0.25 percent of GDP during those four years, not several percent.
3. “And then to put a man on the moon in basically 7 years from scratch. We can’t even build a bridge in 7 years or 17 years…”
It wasn’t from scratch. The Appollo Mission was proposed by Eisenhower in 1960 as a follow up to Project Mercury that began in 1958. So a minimum of 11 years, not including previous missile technology.
* (It wasn’t low picking fruit at the time of past incrememtal innovation)
p. 7 on technological diffusion