Give Thanks For Creative Destruction

Harry S. Dent | Thursday, November 22, 2012 >>


Ten thousand years ago (give or take a few years), the agricultural revolution began the destruction of the old way of life in biblical towns like Jericho.

Over 5,000 years it turned places like Uruk and Cairo in the Middle East into trading centers, and places like Athens, Alexandria, Cairo and Rome followed and became even larger metropolises.

Five thousand years later, the most advanced economies in Western Europe developed tall sailing ships, shattering long-held beliefs that the world was flat and discovering the new world.

This discovery of the Americas heralded another bout of creative destruction, which progressed exponentially…

Ninety percent of the new settlers at Jamestown died within one year of colonizing (that’s the same approximate failure rate for venture capitalists and new ventures).

Great expansion at great expense…

The native cultures fared as badly, despite the brief period of peace with the pilgrims in Plymouth, Massachusetts. They succumbed to a new culture of innovation that ultimately created the great middle-class living standards we know today.

These middle-class standards didn’t originate in Europe. They were forged from the creative fires of American innovation. They spread back to Europe from American soil and now they’re spreading around the world… exponentially. To China. To India. To Africa.

And that’s not the only American-born innovation that we paid greatly for…

Did the American Revolution happen in Europe? No, democracy first truly accelerated in the U.S.

Did Europe invent the assembly line? No, Henry Ford did that in the U.S.

Did Europe invent the modern corporation? No, Alfred Sloan did in the U.S. at General Motors.

Did Europe start the railroads?

Well, okay. Yes. Railroads were prevalent in England first. But they expanded the most in the U.S., helping create the single greatest nation in modern history.

And who led the information and technology revolution? The U.S.!

For it all, we have creative destruction to thank. We paid the high prices demanded of us and we progressed accordingly. After all, that’s how creative destruction works. New innovations force change in personal values, technologies, cultures and institutions. They raise our standard and quality of life over time.

And that’s what I give thanks for this Thanksgiving.

In fact, the world should give thanks as well… thanks for what North America has brought to the world in terms of new standards of living that never existed before… for what new innovations we’ll bring to the world after this natural decline in demographic trends comes to an end and we move into the next economic season.

In the meantime, happy Thanksgiving.

Harry

 

 

Categories: Economy

About Author

Harry studied economics in college in the ’70s, but found it vague and inconclusive. He became so disillusioned by the state of the profession that he turned his back on it. Instead, he threw himself into the burgeoning New Science of Finance, which married economic research and market research and encompassed identifying and studying demographic trends, business cycles, consumers’ purchasing power and many, many other trends that empowered him to forecast economic and market changes.