It is helpful to remember that we often have no idea what’s coming up.
“At a 1992 conference Bill Clinton convened shortly after his election to talk about the economy, participants recall, no one mentioned the Internet.”
http://www.nytimes.com/2011/10/09/sunday-review/the-depression-if-only-things-were-that-good.html?_r=1&pagewanted=1 (David Leonhardt is The New York Times Washington bureau chief)
Obviously, this can be both good and bad, but primarily it is humbling. Not only do we not know how to fix things, we don’t really know what natural forces are moving which will fix things or further break them.
Looking backward, we can see this. As Leonhardt notes:
“UNDERNEATH the misery of the Great Depression, the United States economy was quietly making enormous strides during the 1930s. Television and nylon stockings were invented. Refrigerators and washing machines turned into mass-market products. Railroads became faster and roads smoother and wider. As the economic historian Alexander J. Field has said, the 1930s constituted “the most technologically progressive decade of the century.””
But it didn’t seem so at the time as my parents were eating oatmeal for dinner and passing up college scholarships because they needed the income to support their parents and siblings.
So what about 1992 and the Internet?
It’s important to remember that the Internet didn’t come out of nowhere. You can think of the Internet as an open-source version of commercial services that were already of decent size by that time, notably CompusServe, Prodigy and AOL.
CompuServe started in 1969 and “By the mid-1980s CompuServe was one of the largest information and networking services companies in existence, and it was the largest consumer information service in the world.” ( http://en.wikipedia.org/wiki/Compuserve )
The Prodigy service was started in 1980, and had a national rollout in 1990.
America Online rolls out in the 1985-1990 period as well, one platform at a time. From Wikipedia: “Kimsey changed the company's strategy, and in 1985 launched a dedicated online service for Commodore 64 and 128 computers, originally called Quantum Link ("Q-Link" for short). The Quantum Link software was based on software licensed from PlayNet, Inc, (founded in 1983 by Howard Goldberg and Dave Panzl). In May 1988, Quantum and Apple launched AppleLink Personal Edition for Apple II and Macintosh computers. In August 1988, Quantum launched PC Link, a service for IBM-compatible PCs developed in a joint venture with the Tandy Corporation. After the company parted ways with Apple in October 1989, Quantum changed the service's name to America Online.”
These weren’t by any means obscure businesses. Because of who their customers were, they were high visibility businesses with a high growth rate. All were monthly subscription based. You could buy stuff off them such as flowers and groceries to be delivered. But we didn’t seem them as transforming as they turned out to be – and frankly, neither did they because they didn’t come to dominate the Internet.
Leonhardt has a good point that we may not currently be producing the same quality of innovation in this recession as we did in the Great Depression, and which ultimately fueled prosperity after the war. Maybe we aren’t, and maybe we just can’t see it.
My guess, though, is that we aren’t as hungry (i.e. driven) now as we were then. But it’s only a guess.