Irving Wladawsky-Berger

The Digital Divide in How We Use the Internet

A few weeks ago I attended an MIT seminar by Esteban Moro, professor at Universidad Carlos III in Madrid and visiting professor at MIT. Moro’s talk discussed the socio-economic digital divide based on how we use the internet, focused on two key questions: how profound is the digital usage gap in our society?; and can we use mobile phone traffic to infer socioeconomic status? His seminar was based on a recently published article in the Journal of the Royal Society Interface co-authored with four collaborators, - News or social media? Socio-economic divide of mobile service consumption.

“Inequality is a central societal problem, especially within rapidly expanding urban areas,” wrote the authors. “While it is a crucial driver for economic growth, the progressive clusterization of workers, industries, companies and services in cities has a tremendous cost in terms of segregation and discrimination. This cost is not only economic: in the same city, different areas can have a 10- to 15-year imbalance in life expectancy and highly divergent education levels, with little chances of social mobility.”

“The design and successful implementation of policies to alleviate these problems require fine-grained, frequently updated information about income, education or inequality across metropolitan areas,” they added. “However, most data sources employed today, such as population censuses or surveys, suffer from sparsity in population coverage or infrequent updating, hence they do not allow the swift evolution that urban societies experience nowadays to be followed. Thus, the traditional ways of understanding cities tend to explain what happened 5 years earlier rather than nowcasting or even predicting urban transformations.”

In his seminar, Moro referred to the socio-economic divide based on how we use the internet as the second digital divide, in contrast to the original digital divide which was based on access to the internet.

How Do Young People See the World Compared to Older Generations?

“There is an emerging narrative about a growing intergenerational divide worldwide,” said a recent international survey conducted by The Changing Childhood Project. “In the media and in popular culture, the young are often portrayed as impatient, militant, outspoken, and even entitled, in contrast to more sober temperaments among older people. The concept of intergenerational tension is not new. What may be new, however, is the speed with which our world is changing – and with it, childhood.”

The Changing Childhood Project is a collaboration between UNICEF, - the UN agency responsible for providing humanitarian and developmental aid to children around the world, - and Gallup, - the analytics company best known for its international opinion polls. Created to explore these intergenerational shifts, the project seeks to answer a few key questions: what is it like growing up today?; how do young people see the world differently?; and, is there an intergenerational gap?

Why Do We Work So Damn Much?

A few weeks ago, I listened to a very interesting podcast, Why Do We Work So Damn Much?, where podcast host, NY Times columnist Ezra Klein, interviewed anthropologist James Suzman. Suzman has devoted almost thirty years to studying and writing about the Ju’hoansi and other bushmen from the Kalahari Basin, who are among the world’s few remaining hunter-gatherer societies. He recently published Work: A Deep History from the Stone Age to the Age of Robots, a book about his research.

Modern humans emerged in Africa between 200,000 and 300,000 years ago. Our homo sapiens ancestors were hunter-gatherers for most of those years, collecting wild plants and hunting wild animals. Starting around 12,000 years ago, the agricultural revolution introduced the domestication of plants and animals, leading many hunter-gatherer groups to establish agricultural communities and villages.

The vast majority of hunter-gatherers disappeared a long time ago, but a few groups remain in isolated sections of Africa, Australia, the Amazon rainforest and the Arctic. Anthropologists have been studying these remaining hunter-gatherers to learn how they’ve been able to survive so much longer than other human groups, as well as to understand the behaviors and cultures that modern humans may have inherited from our closest ancestors.

A New Contract with the Middle Class

“The U.S. is a middle-class nation,” says the opening sentence of A New Contract with the Middle Class, an essay by Richard Reeves and Isabel Sawhill that was recently published by the Brookings Institution. “Since our nation’s founding, the American Dream has always been based on an implicit understanding - a contract if you will - between individuals willing to work and contribute, and a society willing to support those in need and to break down the barriers in front of them.” The essay is part of the Future of the Middle Class initiative launched by Brookings in November, 2018.

Why focus on the middle class? The reason, notes the essay, is that this is how the majority of Americans define themselves. “An aristocratic leisure class and a welfare-dependent underclass are equally unappealing to most Americans.” It’s why paid work is seen as so important. Americans want a society where everybody has the chance to “make something of themselves.” Joining the middle class is the very core of the American Dream, - the promise that anyone can get ahead and achieve success and prosperity through talent and hard work.

Who is in the middle class? While there are multiple definitions, most are based on income, partly because data on income are widely available, and it’s easier to come up with concrete, quantifiable definitions. But also because income tends be highly correlated with other attributes of social class, such as educational level, job status, consumer preferences, behaviors, aspirations, and cultural tastes.

The essay defines middle class as those in the middle 60% of household income distribution. “To be middle class, a household of three would have an income between $40,000 and $154,000,” - neither poor nor prosperous. “The middle class, by our definition, is diverse: 59 percent white, 12 percent Black, 18 percent Hispanic, and 6 percent Asian. Within a few decades, whites will make up the minority of middle-class families.”

New Directions for Government in the Digital Age

Over the past few decades, economies and societies around the world have been going through historical transformations as they transition from the industrial age of the past two centuries to a 21st century digital age. Companies - especially large, global corporations - have leveraged digital innovations to improve their productivity and competitiveness and adapt better to these powerful technology and market changes.

In 2010, the Technology CEO Council released a report recommending that governments embrace the information technologies (IT) and organizational best practices that the private sector was successfully applying: “By harnessing major technological shifts and adopting best business practices, we can not only make our government far more productive, but also foster greater innovation in areas ranging from healthcare to education and energy - innovation that will generate economic growth and job creation.”

But governments have continued to lag the private sector, and risk falling further behind as the pandemic accelerated the digital transformations that are helping companies cope with the crisis. “We’ve seen two years’  worth of digital transformation in two months,” as companies adapt to stay open for business “in a world of remote everything,” said Microsoft CEO Satya Nadella in April 2020. A month later, McKinsey & Company added, “We have vaulted five years forward in consumer and business digital adoption in a matter of around eight weeks.”

The authors of a recently published report, “New Directions for Government in the Second Era of the Digital Age,” argue that governments should exploit this fast-moving era of technology in their own operations, for the overall benefit of their nations. The 120-page report was authored by Don Tapscott, Kirsten Sandberg, and Anthony Williams from the Blockchain Research Institute (BRI), in collaboration with the Chamber of Digital Commerce and experts from several countries. The BRI is a global think tank dedicated to the strategic implications of blockchain and related technologies to business, government and society. I am a research contributor at the BRI.

The report aims to assist government leaders around the world, but is particularly focused on the opportunities and challenges facing the new US administration.

Is Work-from-Anywhere Here to Stay?

Remote work has been around for a few decades, but took off in the mid-late 1990s with the explosive growth of the Internet.  There were predictions that the Internet would lead to the decline of cities, because technology was making location less relevant to our work and personal lives.  Why would anyone choose to live in an expensive, stressful metropolitan area and endure a long daily commute?  However, instead of declining, superstar cities continued to attract talented, ambitious knowledge workers, and to generate the greatest levels of economy activity and innovation.

But, even before the pandemic, “a movement was brewing within knowledge-work organizations,” wrote Harvard professor Prithwiray (Raj) Choudhury in a recent Harvard Business Review article, Our Work-from-Anywhere Future.  “Personal technology and digital connectivity had advanced so far and so fast that people had begun to ask, ‘Do we really need to be together, in an office, to do our work?’”

“We got our answer during the pandemic lockdowns.  We learned that a great many of us don’t in fact need to be colocated with colleagues on-site to do our jobs.  Individuals, teams, entire workforces, can perform well while being entirely distributed - and they have.  So now we face new questions: Are all-remote or majority-remote organizations the future of knowledge work?  Is work from anywhere (WFA) here to stay?”

The 2019 Artificial Intelligence Index

AI has emerged as the defining technology of our era, as transformative over time as the steam engine, electricity, and the Internet.  While still in its early stages, AI is already reshaping the economy, society, our personal lives and the very nature of work, with much more to come as the technology and applications mature, including the scientific research necessary to anticipate and fight future pandemics.  But, what’s the current state of AI and where is it heading?

To help address these important questions, the annual Artificial Intelligence Index was created under the auspices of the Stanford Institute for Human-Centered Artificial Intelligence, - guided by a Steering Committee of experts from academia and industry, and in collaboration with a number of sponsoring partners and data contributors.  The AI Index aims to “provide unbiased, rigorous, and comprehensive data for policymakers, researchers, journalists, executives, and the general public to develop a deeper understanding of the complex field of AI.”

Now in its third year, the 2019 AI Index Report was released this past December.  So was the associated 2019 AI Index Data, which includes three times as many data sets as the 2018 edition.  The report  comprises nine chapters.  Let me summarize a few of its highlights.

The Digitalization of the American Workforce

“Over the past half century, wave after wave of digital innovation has ensured that digitalization - the diffusion of digital technologies into nearly every business and workplace and pocket - has been remaking the U.S. economy and the world of work,” said the Brookings Institution in Digitalization and the American Workforce.  The digitalization of everything has both increased the potential of individuals and societies while contributing to widespread anxiety about its impact on jobs and economic inequalities.  “And yet, for all of the evidence that big changes are underway, surprisingly little data exists to track the spread of digital adoption.”

The Brookings report quantified the spread of digitalization by analyzing the changes in the digital content of 545 occupations between 2002 and 2016 based on O*NET, the most comprehensive data on US occupations sponsored by the US Department of Labor.  O*NET includes highly detailed, task-level information on hundreds of occupations, and includes quantitative measures of knowledge requirements, skills, tools, education, training and work activities. In addition, the report collected information on the occupations’ particular industries, pay, growth rates, geographical locations and distribution across educational and demographic groups.

Each of the 545 occupations, - which encompassed 90% of the US workforce, - was assigned a digital score between 0 and 100 based on the required digital skills.  High digital occupations are those with scores over 60.  They include software developers - with a score of 91; computer system analysts - 79; and financial managers, - 61.  Medium digital occupations scored between 33 and 60, and include lawyers - 58; automative service technicians - 55; office clerks - 55; and registered nurses - 55.  Low digital occupations have a score below 33, and include security guards - 31; restaurant cooks, - 18; construction laborers - 17; and personal care aides - 14.

Free-Market, Free-Trade Capitalism at a Crossroads

The global economy has undergone considerable change over the past few decades.  Results have been mixed.  On the positive side, the digital revolution has significantly improved the quality of life of billions around the world.  Technology advances like the smartphone and wireless Internet, and the economic development brought about by globalization have led to the dramatic decline of extreme poverty around the world.  However, these benefits have been accompanied by major dislocations in labor markets, benefiting workers in low-cost developing nations while severely impacting workers in advanced economies.

The promise of technological progress and globalization as drivers of growth and prosperity has been a reality for many, but it’s also created winners and losers within nations, leading to rising economic inequality and fueling the rise of populism in countries around the world.  What’s going on?  I believe that part of the answer to this very important question can be found by exploring the evolution of free-market, free-trade capitalism over the past couple of centuries.

Adam Smith, the 18th century Scottish economist and philosopher, is the father of free market, free trade capitalism, and one of the major figures of The Enlightenment.  In the The Wealth of Nations, considered the first modern work of economics, he explained that in a free market, an individual pursuing his own self-interests tends to also promote the good of his community as a whole, and that the free market, while appearing chaotic and unrestrained, is actually guided to produce the right results by a so-called invisible hand.

The past 200 years have seen many variants of capitalism.  They’re all generally based on the private ownership of the means of production, their operation for profit, and the accumulation of capital.  Neoclassical economics, first formulated in the 19th century, led to a laissez-faire model of capitalism, based on the premise that given all relevant information people will make rational decisions, markets on their own will achieve the right results, and government interventions, - e.g., regulations, subsidies, tariffs, - are almost always a bad idea.

Faith in neoclassical economies was shattered in the 1930s by the Great Depression, giving rise to Keynesian economics, named for British economist John Maynard Keynes.  His pragmatic, mixed model of capitalism, based on a predominantly private sector economy but with an appropriate role for the public sector, dominated economic thinking for the next four decades.

Despite All the Bad News that Surround Us… Is the World Actually Getting Better?

The World is Getting Quietly, Relentlessly Better is the title of a recent WSJ article by its chief economics commentator Greg Ip.  “If you spent 2018 mainlining misery about global warming, inequality, toxic politics or other anxieties, I’m here to break your addiction with some good news: The world got better last year, and it is going to get even better this year,” writes Ip in his opening paragraph.  “Poverty around the world is plummeting; half the world is now middle class; and illiteracy, disease and deadly violence are receding.  These things don’t make headlines because they are gradual, relentless and unsurprising.”

Ip’s article is mostly based on data insights from Our World in Data, a comprehensive website that quantifies the evolution of our global living conditions over the past few centuries.  Our World in Data (OWID) is an initiative of the Oxford Martin Programme on Global Development, led by economist Max Roser at the University of Oxford.

OWID analyzes longitudinal data on how the world has been changing over decades and centuries, as well as explaining the causes and consequences of those changes in its accompanying articles. It makes extensive use of visual aids, including interactive graphs and maps, to present its analyses and insights.  Its content is organized into 15 main sections:  population, health, food, energy, environment, technology, growth & inequality, work & life, public sector, global connections, war & peace, politics, violence & rights, education, media and culture, -  each of which further includes a number of subsections.

Let me summarize just a few of the key trends in the OWID website.

The 2018 MIT Inclusive Innovation Challenge

In 2016, MIT’s Initiative on the Digital Economy launched its first annual Inclusive Innovation Challenge (IIC).  The key objective of the IIC is to help create greater shared prosperity around the world by awarding over one million dollars in prizes each year to to entrepreneurs that are leveraging technology advances to reinvent the future of work.

“The IIC believes that Inclusive Innovation is an economic and moral imperative, and that the key question of our era isn’t what technology is going to do to our economy and society, but what we will do with technology.  By identifying and promoting the powerful global community of future of work visionaries, the IIC proactively accelerates the technology-driven solutions enabling greater economic opportunity for working people around the world facing the challenge of rapidly advancing digital progress.”

Entrepreneurs from around the globe compete for awards in four categories: income growth and job creation, skills development and opportunity matching, technology access, and financial inclusion. Approximately 1,500 organizations registered to compete this year, and 500 judges reviewed their applications.   

In 2018, rather than having one global competition as in the previous two years, there were five separate regional competitions, - North America, Latin America, Europe, Africa, and Asia, - each region selecting its own category winners.  A Grand Prize winner was then selected in each category from among the regional winners and each awarded $250,000.  The winners were announced at a gala event that took place in MIT on November 8.

The Complex Relationship Between Science and the Public

More than ever, scientific and technological innovations touch every aspect of our lives and influence the choices we make in a wide variety of areas.  A 2015 study by the Pew Research Center revealed that most Americans have a positive view of science and of the accomplishments of scientists.  But, despite broadly similar views about the place of science in the country, there were large differences between the general public and scientist across a number of important issues, including genetically modified foods, vaccine safety and climate change.

Two years ago, the American Academy of Arts and Sciences launched The Public Face of Science, an initiative whose objective is to better understand the complex relationship between scientists and the public in America.  A few weeks ago, the Academy released Perceptions of Science in America, the first in a series of reports from the Public Face of Science initiative.  The report aims to analyze the public’s perception of scientists, explore how opinions vary among different populations, and shed light on how public opinions are shaped.  Its analysis is based on survey data from multiple sources, including the Pew Research Center, the National Science Board Science and Engineering Indicators, the National Opinion Research Center, Research!America and ScienceCounts.

What do we mean by science?  “The term science encompasses a range of disciplines in the physical, social, and life sciences, along with applied fields, such as engineering and medicine,” notes the report. “Science can be defined as ‘the use of evidence to construct testable explanations and predictions of natural, as well as the knowledge generated through this process.’”  But, one must keep in mind that the word science is interpreted differently by different individuals, - e.g., medical treatments, technological advances, fundamental research.  “When interpreting the available survey data, it is important to consider the range of responses a question might prompt.”

The Rise of Winner-Take-All Urbanism

Earlier this year, Richard Florida published Why America’s Richest Cities Keep Getting Richer in The Atlantic.  Florida is a leading urban studies author and researcher, professor at the University of Toronto and Director of Cities at its Martin Prosperity Institute.

“The most important and innovative industries and the most talented, most ambitious, and wealthiest people are converging as never before in a relative handful of leading superstar cities that are knowledge and tech hubs,” wrote Florida.  “This small group of elite places forge ever forward, while most others struggle, stagnate, or fall behind.  This process is one I like to call winner-take-all urbanism.”

Winner-take-all urbanism is another manifestation of the winner-take-all economics of the past few decades, in which a relatively small number of players reap a very large share of the rewards, upending whole industries with their outsized returns.

Gender Diversity, Empathy and Technology

What’s the value of gender diversity in technology-based disciplines?  Is gender diversity an asset for technology-based companies?  Are men inherently better than women at technology-based jobs?

These are questions that have long been discussed.  Lots of progress has been made in addressing them.  But they recently resurfaced following an internal memo by Google engineer James Damore that criticized the company’s diversity initiatives, for which he was subsequently fired by Google.

Let me attempt to explore these questions based on relatively recent academic research in three key areas: gender-based behavioral differences; how to create smarter working groups; and the changing skills requirements in the digital economy.

The True State of Globalization

The July-August issue of the Harvard Business Review features an article by NYU and IESE professor Pankaj Ghemawat, - Globalization in the Age of Trump: Protectionism Will Change How Companies Do Business - But Not in the Ways You Think.  Ghemawat has long been conducting research on globalization, and has written extensively on the subject.  His latest book, The Laws of Globalization, was published in October of 2016.

“Business leaders are scrambling to adjust to a world few imagined possible just a year ago,” notes the article’s opening sentence.  “The myth of a borderless world has come crashing down.  Traditional pillars of open markets - the United States and the UK - are wobbling, and China is positioning itself as globalization’s staunchest defender.  In June 2016, the Brexit vote stunned the European Union, and the news coverage about globalization turned increasingly negative in the U.S. as the presidential election campaign progressed.”

What should companies do?  Should they pack up and return home?  Is this the end of globalization, only a dozen years after Thomas Friedman’s The World is Flat became a prominent international best-seller?  “Not according to my research,” says Ghemawat. 

Peering into a Confusing, Paradoxical Future

Every four years since 1997, the US National Intelligence Council has been publishing a Global Trends report on the key trends that will shape the world over the following twenty years.  This unclassified strategic report is intended to provide the incoming administration and other senior leaders with a framework for long-range policy assessment.

Global Trends 2030: Alternative Worlds, released four years ago, identified four overarching megatrends that are expected to shape and transform the world by 2030: the empowerment of individuals - which will accelerate the reduction of poverty and raise the standard of living around the world; the diffusion of power among states, - which will shift power to networks and coalitions in a multipolar world; changing demographic patterns especially rapid aging, urbanization, and increased migration; and growing demands on resources such as food, water and energy, - which might lead to scarcities.

The latest Global Trends report, Paradox of Progress, was released earlier this year.  It begins by explaining its title. “We are living a paradox: The achievements of the industrial and information ages are shaping a world to come that is both more dangerous and richer with opportunity than ever before… The progress of the past decades is historic - connecting people, empowering individuals, groups, and states, and lifting a billion people out of poverty in the process.  But this same progress also spawned shocks like the Arab Spring, the 2008 Global Financial Crisis, and the global rise of populist, anti-establishment politics.  These shocks reveal how fragile the achievements have been, underscoring deep shifts in the global landscape that portend a dark and difficult near future.”

Technology, Capitalism and “The American Way of Life”

Much has been written about our digital technology revolution and its impact on economies, societies and individuals.  But few have brought the kind of historical perspective to the subject that helps us better understand our turbulent times like scholar and consultant Carlota Perez in her 2002 book Technological Revolutions and Financial Capital:  The Dynamics of Bubbles and Golden Ages and related publications.

According to Perez, over the past few centuries, we’ve had a technology revolution every 40 to 60 years, starting with the Industrial Revolution in 1771, which was characterized by the emergence of machines, factories and canals.  This was followed by the age of steam, coal, iron and railways starting in 1829; steel, electricity and heavy engineering in 1875; and oil, autos and mass production in 1908.  Our present age of information and communication technologies (ICT), whose starting point she pegs at 1971, is the fifth such major revolution.

Technology revolutions have two distinct periods, each lasting 20 to 30 years.  The installation period is the time of creative destruction, when new technologies emerge from the lab into the marketplace, entrepreneurs start many new businesses based on these new technologies, VCs encourage experimentation with new business models, and the new ventures attract considerable investments and financial speculation.  Inevitably, this all leads to bubbles and crashes like the recent dot-com and subprime mortgage bubbles.

After the crash, comes the deployment period, a time of institutional recomposition.  The now well accepted technologies become the norm.  New paradigms emerge for guiding innovation and for determining winners and losers in the marketplace.  Over time, these new paradigms significantly transform the economy and everything around it, as well as re-shaping social behavior and the institutions of society.

Last year Perez published Capitalism, Technology and a Green Global Golden Age: The Role of History in Helping to Shape the Future.  In this recent article, she argued that we’re going through a crucial moment in history similar to the 1930s, which requires the kind of creative thinking and bold measures for which we justifiably celebrate statesmen like Franklin Delano Roosevelt and John Maynard Keynes.  Let me summarize her argument.

The 2016 MIT Inclusive Innovation Awards

Several months ago, MIT’s Initiative on the Digital Economy launched its first annual Inclusive Innovation Competition (IIC).  MIT is one of the world’s top research universities, renowned as well for its entrepreneurial culture.  But the objectives of the IIC are quite different and unique.  Instead of competing on creating the most advanced technologies or compelling startups, the IIC is focused on innovations aimed at improving the economic opportunities of middle- and low-income earners around the world.

Applicants competed for $1 million in prizes to be awarded in four main categories: Skills, - how employees were re-skilled for new types of jobs; Matching, - how qualified people were connected to new types of jobs; Humans + Machines, - how technology is used to augment human labor; and New Models, - how new business models revolutionize labor markets and job opportunities.  In each of these categories, the grand prize winner was awarded $125,000, while each of the four runner-ups received $25,000.  In addition, four additional $25,000 Judges Choice Awards were given to organizations deemed by the judges to be uniquely inventive.

I’m a Fellow of the Initiative on the Digital Economy, and served as one of the judges in the competition.  243 applications were received from around the world, from which we selected 24 finalists.  I personally reviewed around 20 applications, and was really impressed not only by their innovative ideas, but also by their courage and determination as they addresed some of society’s toughest problems.

How is the Real America Doing?

Listening to cable news, talk radio, and our heated election campaigns, you might quickly conclude that the US is going to hell, that the best days of America are behind us and that the country is unraveling right in front of our eyes.  To a greater or lesser extent, these sentiment are to be expected in a presidential-election year, when the out-of-power party always argues that things are bad and getting worse.  But for the last several years, the apocalyptic sentiments are coming not only from most on the right but from many on the left as well.

Beltway Washington is going through a particularly polarized, volatile phase, as has sometimes been the case through the country’s history.  Moreover, the amplifying effects of social networks and 24/7 information channels make it even harder to find common ground and get anything done.

But, what’s going on beyond the beltway, - in cities and towns across America?  Beyond the surreal world of Washington politics, is the country truly falling apart?  How are Americans faring, despite the hard times so many have been going through?  What’s going on in the real America, where real people live and work and where the proverbial rubber meets the road?

Capitalism and Social Issues in the 21st Century

A recent NY Times article, The Sunny Side of Greed by Op-Ed columnist Frank Bruni, argues that corporations may well now be among the strongest socially progressive forces in the country.  In issue after issue, - e.g., marriage equality, the confederate flag,  immigration reform,  - the business community has supported what we generally think of as the more socially progressive position. 

“Are these companies acting in their own interests?,” asks Bruni. “Absolutely.  They’re trying to make sure that laws and local customs don’t prevent them from attracting and retaining the best work force.  They’re burnishing their brands in a manner that they hope will endear them to customers.  But those efforts, coupled with whatever genuine altruism and civic obligation some corporate leaders feel, have produced compelling recent examples of companies showing greater sensitivity to diversity, social justice and the changing tides of public sentiment than lawmakers often manage to.” 

While our politicians are paralyzed by ideological arguments and partisan bickering, corporations seem to have little trouble embracing the more pragmatic positions that seem to better reflect the overall mood of the country on social issues like immigration and same-sex marriage.  The reason isn’t all that difficult to understand.  Many politicians must respond to the wishes of a few big donors and of small, single-issue interest groups in their districts.  But companies, especially those with national and global brands, must be responsive to a much larger, diverse constituency, namely their customers.

The Science of Innovation

 “Innovation - identified by MIT economist and Nobel laureate Robert Solow as the driver of long-term, sustainable economic growth and prosperity - has been a hallmark of the Massachusetts Institute of Technology since its inception.”  Thus starts The MIT Innovation Initiative: Sustaining and Extending a Legacy of Innovation, the preliminary report of a yearlong effort to define the innovation needed to address some of the world’s most challenging problems.  Released earlier this month, the report was developed by the MIT Innovation Initiative, launched a year ago by MIT President Rafael Reif.

I found the report quite interesting, both because I’ve been closely involved with innovation activities through a great part of my career, and because since 2005 I’ve been affiliated with MIT.  Beyond MIT, the report should be of value to anyone interested in the growing importance of innovation to institutions, economies and societies around the world.

A decade ago I was part of the National Innovation Initiative, a major effort convened by the Council on Competitiveness to develop a US innovation agenda.  Its final report, - Innovate America: Thriving in a World of Challenge and Change, - was released in December of 2004.  The report did an excellent job in explaining the role innovation plays in US competitiveness.  It included more than 60 detailed recommendations in three major areas: talent, investment and infrastructure. 

Since then, technology has continued to make dramatic advances.  But for a variety of reasons, job creation, entrepreneurship and US global competitiveness, - the key measures of a thriving innovation economy, - have not fared so well.  A number of recent studies have observed that startup rates, - the nation’s job creative engine, -  have been declining across the country, especially since 2000.  And while US employment keeps improving, serious questions remain about the impact of the digital revolution on the job prospects and wages of a large fraction of the workforce.  In addition, the US is now in 10th place in R&D investments as a percentage of GDP among OECD nations, - having fallen from 2nd place in 1992.  Innovation remains a subject in need of serious attention, especially given the emergence of our highly complex and unpredictable digital economy.

Why Are Americans so Divided? Why Are We so Angry?

In a column recently published in the NY Times, Robert Reich, - UC Berkeley professor, author and former Secretary of Labor, - wrote about his experience while in an airport to catch a flight.  A well-dressed man approached him and said: “You are a Commie dirtbag,” actually using an unprintable profanity.  Reich was taken aback, but decided to respond as civilly as he could.

“You’re wrong.  Where did you get your information?,” he asked the man.  “Fox News.  Bill O’Reilly says you’re a Communist,” the man replied and walked away irritated. 

“It’s rare that I’m accosted and insulted by strangers, but I do receive vitriolic e-mails and angry Facebook posts,” wrote Reich.  “On the Internet and on TV shows, name-calling substitutes for argument, and ad hominem attack for reason.” 

“Scholars who track these things say the partisan divide is sharper today than it has been in almost a century.  The typical Republican agrees with the typical Democrat on almost no major issue.  If you haven’t noticed, Congress is in complete gridlock.”

Governance and Pragmatism: Moving Beyond “The Culture of No”

Checks and balances is one of the most important principles for making decisions and getting things done in a highly complex organization.  While we primarily associate checks and balances with the US system of government, I believe that it equally applies to any other complex organizational system.  It implies an organizational structure and a set of procedures to ensure that no one unit or individual has too much power over major decisions, especially those decisions that, if wrong, could have serious consequences.  It forces the different parts of the organization to cooperate.  It trades off short term efficiency and speed in favor of the longer term stability of the institution. 

Most large companies have set up some form of check-and-balances organizational structure, often embodied in the separation of line and staff management.  There is a built-in contention system in such an organizational structure.  In addition to supporting the line functions, the staffs serve as the checks-and-balances of the company, making sure that the activities of all departments and individuals follow the company’s strategy and are in compliance with business, legal and regulatory requirements.

Reflections on the Nature of Human Organizations

Urbanization is one of the major forces transforming societies all over the world.  The rapid pace of urbanization is succinctly summarized in these sentences from the 2012 World Urbanization Prospects of the United Nations Population Division:  

“Between 2011 and 2050, the world population is expected to increase by 2.3 billion, passing from 7.0 billion to 9.3 billion (United Nations, 2011). At the same time, the population living in urban areas is projected to gain 2.6 billion, passing from 3.6 billion in 2011 to 6.3 billion 2050.  Thus, the urban areas of the world are expected to absorb all the population growth expected over the next four decades while at the same time drawing in some of the rural population.  As a result, the world rural population is projected to start decreasing in about a decade and there will likely be 0.3 billion fewer rural inhabitants in 2050 than today.”

In 1900, less than 15 percent of world’s population lived in cities.  According to the latest UN estimates, 52 percent of the world’s population now lives in urban areas.  That number is estimated to go up to 60 percent by 2030, and near 70 percent by 2050. 

Why are metropolitan areas continuing to grow at such a rapid pace?  After all, back in the 1990s, quite a few people were predicting that the Internet would cause cities to decline.  The Internet would enable people to work from anywhere, so they would choose to live in less populated areas, where lower costs and more space would let them enjoy a better quality of life.  Needless to say, these predictions have not come true.

The Science of Cities

Last April, New York City Mayor Michael Bloomberg and NYU President John Sexton announced the formation of the Center for Urban Science and Progress (CUSP), an applied science research institute led by NYU and NYU-Poly in partnership with academic institutions, global companies and New York City government agencies.  CUSP is focused on the grand technical, intellectual, engineering, academic, and human challenges posed by a rapidly urbanizing world.  Several weeks ago, I was appointed executive-in-residence at CUSP by its Director, Steve Koonin. 

Urban systems are the quintessential example of complex sociotechnical systems, the emerging field studying systems that combine powerful and ubiquitous digital technologies with the people and organizations they are transforming.  Such systems exhibit a level of complexity that, until recently, has often been beyond our ability to understand and control.  Not only do we have to deal with the complexities associated with large scale IT infrastructures, but with the even more complex issues involved in human and organizational behaviors. 

This emerging field aims to go beyond the analysis of cities and similar sociotechnical systems.  It aims to be prescriptive in nature, applying its findings to help us design better performing systems and organizations, as is the case with other engineering and management disciplines.  It is multidisciplinary in nature, and should enable us to address a particular domain, - e.g., transportation, energy, finance, - by bringing together a number of different methodologies, including: systems-oriented techniques like optimization, stochastic systems, systems simulation and systems dynamics; social sciences, management and planning; and engineering capabilities focusing on design, development, testing and operations. 

STEM Literacy is for Everyone

MIT professor Richard Larson recently wrote an excellent opinion column - STEM is for Everyone.  In the column, he succinctly made the case for widespread STEM (Science, Technology, Engineering and Math) literacy, and explained why it is as important to our 21st century information economy as basic reading-writing literacy has been to the industrial economy of the past two centuries.  According to Larson, STEM literacy is a way of thinking and doing:   

“A person has STEM literacy if she can understand the world around her in a logical way guided by the principals of scientific thought.  A STEM-literate person can think for herself.  She asks critical questions.  She can form hypotheses and seek data to confirm or deny them.  She sees the beauty and complexity in nature and seeks to understand.  She sees the modern world that mankind has created and hopes to use her STEM-related skills and knowledge to improve it.” 

Larson is Professor of Engineering Systems and Civil and Environmental Engineering at MIT.  He is a pioneer in applying STEM capabilities to a wide variety of problems in services industries, from urban systems to online learning.  He is the founder and director of LINC - Learning International Network Consortium, a collaboration involving educators from around the world who share best practices on how to best organize higher education distance learning projects in developing countries.  Among LINC’s key projects is Blossoms  - Blended Learning Open Source Science or Math Studies, which is developing a large free repository of video modules created by gifted volunteers from around the world to assist school teachers with math and science courses.

An Emerging Platform for Digital, Inclusive Innovation

The Internet era was born in the mid 1990s.  On August 9, 1995, Netscape’s IPO caught the world by storm.  It marked the passage of the Internet from a network primarily used by universities, research labs and geeks in general, to a platform with a vastly expanded reach and connectivity.  Anyone with a personal computer and Web browser, was now able to access all kinds of content, communicate with people all over the world, and conduct a variety of transactions over the Internet.  

The Internet became an incredible platform for innovation, enabling startups, large institutions, and everyone in between to quickly develop and bring to market many new digital products and services.   Its reach and connectivity led to the creation of all kinds of innovative, digital applications.  It enabled individual and institutions to do all the things they did much, much better.  It transformed all kinds of every day activities, including the way we work, shop, learn, bank, listen to music, watch films and deal with government.

But, getting online and being able to access the Web and the many applications built around it required a personal computer and an Internet account.  And, e-commerce transactions required a credit card or bank account.  So, while the Internet was truly empowering for those with the means to use it, it led to serious concerns about the growing digital divide both within countries and across the world. 

The reach and connectivity we were all so excited about in this initial phase of the Internet era was in reality not so inclusive.   As our economy was becoming increasingly digital, major new inequalities were now arising because so many around the world could neither afford a PC or an Internet account and had no bank relationship or credit card.  It was disconcerting to have a digital revolution and new information-based economy that left out the majority of the world’s population.

The Economic and Cultural Polarization of America

Coming Apart: the State of White America 1960-2010, a recently published book by scholar and author Charles Murray, has generated some very interesting and important discussions about America’s increasingly polarizated society.  In a January NY Times Op-Ed, David Brooks wrote that Coming Apart will prove to be one of the most important books of 2012 because it “so compellingly describes the most important trends in American society.”

The key premise of the book, as described by Murray in this Wall Street Journal column, is that “America is coming apart. For most of our nation’s history, whatever the inequality in wealth between the richest and poorest citizens, we maintained a cultural equality known nowhere else in the world - for whites, anyway.”  For most of its history, a major hallmark of American democracy has been the comfortable mingling of the social classes.  “Americans love to see themselves this way,” writes Murray.  “But there's a problem: It's not true anymore, and it has been progressively less true since the 1960s.”

Fifty years ago, there were large income gaps between rich and poor, but the differences are much bigger today.  More important, those income gaps did not lead to differences in behavior.  There was a common civic culture, - the American way of life, - “that swept an extremely large proportion of Americans of all classes into its embrace.  It was a culture encompassing shared experiences of daily life and shared assumptions about central American values involving marriage, honesty, hard work and religiosity.”

Blogging and Personal Feelings

In November of 2008, Andrew Sullivan published an excellent article in The Atlantic, - Why I Blog, - in which he discussed the unique characteristics of a blog by reminding us what a web log shares in common with its namesake, the ship log.

“In journeys at sea that took place before radio or radar or satellites or sonar, these [ship] logs were an indispensable source for recording what actually happened.  They helped navigators surmise where they were and how far they had traveled and how much longer they had to stay at sea. . .  A log provided as accurate an account as could be gleaned in real time.”

“As you read a log, you have the curious sense of moving backward in time as you move forward in pages - the opposite of a book.  As you piece together a narrative that was never intended as one, it seems - and is - more truthful.  Logs, in this sense, were a form of human self-correction.  They amended for hindsight, for the ways in which human beings order and tidy and construct the story of their lives as they look back on them.  Logs require a letting-go of narrative because they do not allow for a knowledge of the ending.  So they have plot as well as dramatic irony - the reader will know the ending before the writer did.”

“Anyone who has blogged his thoughts for an extended time will recognize this world.  We bloggers have scant opportunity to collect our thoughts, to wait until events have settled and a clear pattern emerges.  We blog now - as news reaches us, as facts emerge.  A reporter can wait - must wait - until every source has confirmed.  A novelist can spend months or years before committing words to the world.  For bloggers, the deadline is always now.  Blogging is therefore to writing what extreme sports are to athletics: more free-form, more accident-prone, less formal, more alive.  It is, in many ways, writing out loud.”

I have now been blogging since May of 2005.  As Andrew Sullivan observes about blogs in general, my blog is a record of my changing interests over that time span, of the key items that were catching my attention, and how I felt about them at the time.  Looking back at the many blogs I have posted, I am reminded of some of the major events of the past seven years.

Politics, Women and the Talmud

A couple of months ago a story out of Israel caught my attention.  It concerned an incident that, while extreme, illustrates the tensions between groups with very strong religious beliefs and the larger, much less religious society that does not embrace these views.  As we know, such discussions are now taking place in the US as part of the 2012 Presidential Campaign.  But I prefer to comment on the situation in Israel because it concerns my own religion - Judaism.  In something as personal as religion, you should be sensitive about directly commenting on religions other than your own.

An 8 year old girl, the daughter of observant but modern Orthodox Jews, was harassed by ultra-Orthodox Jewish men as she walked on her way to school.  The men felt that her modest dress did not adhere to their more rigorous dress code for girls and women.  They spit on the girl, insulted her and called her a prostitute.

“The country was outraged,” said the article.  “For many Israelis, this is not a fight over one little girl’s walk to school.  It is a struggle that could shape the future character and soul of the country, against ultra-Orthodox zealots who have been increasingly encroaching on the public sphere with their strict interpretation of modesty rules, enforcing gender segregation and the exclusion of women.”

Would a Distributed Model of Government be More Suitable for a Complex, Diverse 21st Century Democracy?

Last week I wrote about the forces that, in my opinion, are contributing to an increasingly polarized America.  I mentioned three such key forces:  the structural changes and employment challenges our economy is going through; the changing demographics and emergence of a kind of new establishment in US society; and the technology-amplified, free-for-all conversations taking place through our multitude of information and communication channels.

How should government evolve to better adapt to these forces?  Are there innovative government models that might work better than our present ones?  Can we look at the evolution of organizational models in business over the past twenty years for inspiration and guidance?

Companies, especially large, global companies have been going through dramatic changes in the last couple of decades, driven by a combination of advances in information technologies, the Internet, the fast-changing market environment, and the heightened competitive pressures brought about by globalization.  In particular, companies have had to move away from the hierarchic, centralized management models that prevailed in much of the last century and embrace a more distributed organizational style.

“One Nation” in an Increasingly Polarized America

Among America’s most cherished ideas is the notion that, despite all our differences, we are one nation.  It is embodied in the Pledge of Allegiance:  “I pledge allegiance to the flag of the United States of America, and to the republic for which it stands, one nation under God, indivisible, with liberty and justice for all.”  E Pluribus Unum - out of many, one, - appears in all our coins and in the Great Seal of the United States.

But, watching the heated political and social debates taking place all around us causes one to wonder what it means to be one nation in our fractious times.  The ideological polarization of our political parties reflects the deep divisions in the country as a whole.  It is more likely than not that the political volatility of the past decade will continue, barring some rare, high impact black swan event like a severe economic depression or 9/11-like terrorist attack.

What are the implications of living through an extended period of deep social divisions?  How will our idea of one nation evolve over such times?  Has the country ever gone through similar politically volatile times in the past?  Given that the future is so unpredictable, can we at least look at our history for some guidance?

My Upcoming 50th High School Reunion

I graduated high school in 1962 from the University of Chicago Laboratory Schools, usually referred to as U-High.  This June we will be celebrating our 50th class reunion, and, this being 2012, some classmates set up a social media group site that any member of the class of '62 can link to and participate in an online conversation.

Through the years, I have been involved with the University of Chicago (U of C), which I attended after high school for both college and graduate school.  In particular, I have been a member of the Physical Sciences Division Visiting Committee for years.   But, I have not been involved with U-High, perhaps because I only went there for my junior and senior years.  I have not attended previous class reunions, and was not sure if I would attend the 50th reunion when I first heard about it.  But I joined the online group site, as a way to learn about high school classmates which I have not heard from in almost fifty years. 

The group discussions started slowly, but after a few days, I was really looking forward to the postings.  It has proved to be fascinating, not only because of what I am learning about my classmates' lives, but because the discussions of teachers, neighborhood places, and class events have brought to mind many long forgotten memories.  I feel like a character in a coming-of-age film, who as an older man, is reminded of an important period of his youth, which he then proceeds to narrate.

The US Economy in 2012 - Two Big Problems, Two Ready Solutions

What should the US do in 2012 to address its tough economic problems?  We will hear many answers to this question through this presidential election year.  Many will be based on ideological conviction and/or political opportunism.  They will likely not lead to any kind of workable solutions.  But some will be more pragmatic and might perhaps stand a chance.

The January 1 Sunday Business section of the NY Times asked six economists to give their best advice for 2012 on a variety of issues.  Among them was Christina Romer, Professor of Economics at UC Berkeley and former chair of President Obama’s Council of Economic Advisors.  Professor Romer wrote an excellent article, - Two Big Problems, Two Ready Solutions - offering practical advice for the US economy in 2012.

“The United States faces two daunting economic problems: an unsustainable long-run budget deficit and persistent high unemployment,” she writes in the opening paragraph.  “Both demand aggressive action in the form of fiscal policy.  Waiting until after the November elections, as seems likely, would be irresponsible.  It is also unnecessary, since there are plans to address both problems that should command bipartisan support.”

Innovation in Higher Education

A glance at the latest US employment figures from the Bureau of Labor Statistics reveals sharp differences in unemployment rates by educational attainment: college degree or higher: 4.3%; associate degree or some college: 8.2%; high school graduates, no college: 9.6%; and no high school diploma: 14.3%.  Moreover, while the overall unemployment rate remains over 9 percent, a recent McKinsey report found that employers are having trouble filling specific positions because they could not find applicants with the right skills.  The report projects that if economic conditions improve, there will be a shortage of 1.5 million workers with college degrees by 2020, but a surplus of almost 6 million of workers with no high school degree.  It also projects a continuing shortage of workers with technical and health care skills not necessarily requiring a college degree.

Just about every such study points to a similar trend: for the foreseeable future, the US economy will need better educated workers with specific skill requirements.  Workers without a post-secondary education face a contracting set of job opportunities.  Those with higher educational attainments will be in the best position to obtain good jobs with good pay. 

Thus, we need to significantly increase the number of students receiving post-secondary education.  However, our colleges and universities, the very institutions to which the country should turn to help us address these increased educational demands, are facing problems of their own. Tuition costs have risen much faster than the rate of inflation and keep going up, thus making it harder for them to serve the students most in need of their services.  Many educational institutions are facing financial difficulties.  The financial crisis has been aggravating the situation, at both public and private institutions.  Government education budgets are under huge pressure at all levels, - local, state and national.

Incremental steps will not make much of a dent on the problem. We need to look at higher education through the lens of disruptive innovation, argues a report published last February, - Disrupting College: How Disruptive Innovation Can Deliver Quality and Affordability to Postsecondary Education.  The report is written by Clayton Christensen, Michael Horn, Louis Caldera and Louis Soares.

Innovation and Entrepreneurship in Large Metropolitan Areas

For several years now I have been thinking about the differences between various models of innovation and entrepreneurship.  In particular, I have been trying to understand the key differences between the innovation and entrepreneurship models that have worked so well in Silicon Valley, the Boston-Cambridge area and similar high-tech, VC-based regions, and the models that might be more applicable to large metropolitan areas like New York and London.

The Silicon Valley model has become the most prominent example of what it means to be a successful innovation hub.   Over the last few decades, it has been the leading region in the creation of new high-tech products and companies based on advanced digital technologies.  A number of regions around the world have tried to become the next Silicon Valley, hoping to develop the right ecosystem mixture, - including technologists, entrepreneurs, venture capitalists, - that will establish their region as a world class center of innovation.  Most such efforts have fallen short of their goals, - a number ending in outright failure. 

Why is that?  To begin with, most successful high-tech innovation hubs have been built around the great engineering universities in their midst - Stanford and UC Berkeley for Silicon Valley, and MIT for the Boston area.  Over the years, these regions have brought together and carefully nurtured a large and fluid community of technologists and, entrepreneurs who share ideas as they move from company to company - as founders, employees, managers, board members or investors.  They have achieved a remarkable network effect particularly suitable for high-tech innovation that give them an advantage in scale that is almost impossible to replicate.

Their university-based, high tech innovation model is particularly oriented toward finding The Next Big Thing, - that is, the next big technology, product or service that will take world markets by storm, transform whole industries, and in the process, create considerable wealth for their creators and investors.  They have been at the center of several waves of disruptive innovations and creative destruction over the past few decades, and will continue to do so into the future.

But, beyond a few niche areas, this is not a model of innovation and entrepreneurship generally suitable for a large metropolitan region like New York.  A model that would work for New York has to leverage the key strengths of the region.  Let me briefly discuss three such New York strengths in particular.

IBM's Centennial

IBM is turning 100 years old on June 16.  The company is commemorating its 100th anniversary with a year-long set of activities around the world.  It is using the opportunity to reach out to many of its constituents in business, government and academia and engage with them in a variety of celebratory events, such as seminars and conferences.  In addition, IBM Chairman Sam Palmisano is inviting all members of its extended family - employees, partners, retirees, families and friends - to pledge at least eight hours of community service during 2011.

If you look at the fast changing IT industry, it is hard enough to find companies that have survived thirty years, let alone one hundred.  It is even harder to find a company that has survived this long, is in great competitive shape and continues to be among the leaders in its industry.  So, as The Economist observed in 1100100 [100 in binary] and Counting in its June 9, 2011 issue:      

“The firm’s centenary is an occasion to reflect on many things digital, but one question stands out: why is IBM still alive and thriving after so long, in an industry characterised perhaps more than any other by innovation and change?  This is not just of interest to business historians.  As IBM enters its second century in good health, far younger IT giants, such as Cisco Systems, Intel, Microsoft and Nokia, are grappling with market shifts that threaten to make them much less relevant.”

The 2011 Tapia Conference Celebrating Diversity in Computing

Last week I participated in the 2011 Richard Tapia Celebration of Diversity in Computing Conference which took place in San Francisco, where I had the honor to give the Ken Kennedy Distinguished Lecture.

The Tapia Celebration of Diversity in Computing conference is quite unique.  It is aptly named, being the most diverse conference in computing anywhere.  This year, 53% of the participants were female, 47% male.  About 40% were African American, 26% Hispanic, 20% White (non-Hispanic) and 8% Asian.  One third were undergraduate students, one third were graduate students and the rest were professionals from industry and academia. 

They came from a wide-range of places, including historically-black colleges and hispanic serving institutions as well as places like Berkeley, Georgia Tech, Rice, UCLA, and so on.  One of its key objectives is to reassure the students that computing is the right career path for them, help them overcome any potential feelings of isolation by being in an environment with many others just like them, - regardless of their ethnicity or gender, - and increase their dedication to complete their degrees.

Why Is Civil Discourse So Important - Yet So Difficult

In his remarks at the memorial service for the victims of the Tucson shooting, President Obama urged us to be more civil in our dealings with each other:

“The loss of these wonderful people should make every one of us strive to be better.  To be better in our private lives, to be better friends and neighbors and coworkers and parents.  And if, as has been discussed in recent days, their death helps usher in more civility in our public discourse, let us remember it is not because a simple lack of civility caused this tragedy - it did not - but rather because only a more civil and honest public discourse can help us face up to the challenges of our nation in a way that would make them proud.”

Why is civil discourse so difficult?  This is a very important question, dealing with the very essence of being human.  I think of it as a Darwinian-kind of question.  As this provocative Economist article – “Why we are, as we are” - from December of 2008 observed:  “For a Darwinian, life is about two things: survival and reproduction.”

Humans are social animals, and like all such animals, we are ill-equipped to survive on our own.  Our social impulses cause us to naturally gravitate toward forming communities to help us get the necessary survival strengths from each other.  But our evolution - or at least our history - has also channeled these social impulses into forms that are tribal.  That is, we affiliate with our own kind and against the others.

Principles and Compromises

Last week I posted a blog focused on the tax deal between President Obama and Senate Republicans as a good example of political compromise, - bringing people together with widely different opinions in order to get something concrete done.  Such compromises are the essence of effective governance, especially in highly complex organization, whether in business or government.

Are there limits to compromise?  Are there times when our sense of right and wrong should guide our actions?  Are there occasions when principles should trump compromise?

Absolutely.

For example, in 1953 IBM President Thomas J. Watson, Jr. published the company's first equal opportunity policy letter - one year before the U.S. Supreme Court decision in Brown vs. Board of Education and 11 years before the landmark Civil Rights Act - which said:  “It is the policy of this organization to hire people who have the personality, talent and background necessary to fill a given job regardless of race, color or creed.”  And he put IBM’s money where his mouth was – writing to two Southern governors that IBM refused to adopt “separate but equal” policies, and that if those states didn’t like that, IBM would locate its plants elsewhere.

Another notable example is President Lyndon Johnson’s personal leadership in overcoming fierce southern resistance and convincing Congress to pass the aforementioned Civil Rights Act of 1964 as well as the Voting Rights Act of 1965.  President Johnson realized that his party was going to pay a huge price for his actions.  “We have lost the South for a generation,” he is alleged to have told an aide right after signing the 1964 Civil Rights Act.  He was only wrong in that support of civil rights has lost the South to the Democratic Party for far longer than one generation. 

e-Media and e-Journalism in the Internet Age

I have been thinking a lot about the Shirley Sherrod case, not so much for what we can learn about the current state of race relations or political discourse in the US, both of which have been extensively discussed by people much savvier than me on the subjects, but for what the case teaches us about the transformation of the media industry in the Internet Age. 

The facts of the case are well known.  On July 19, Andrew Breitbart posted a 2½ minute edited video of a near 45 minute speech that Shirley Sherrod had given in March of 2010 at an NAACP event.  The edited video segment posted by Breitbart to make Sherrod and the NAACP appear racist would not by itself have been too newsworthy.  After all, we know that the blogosphere and the Internet in general are full of rumors and innuendos, as are cable channels and talk radio.  In any event, Breitbart was not a trusted source for news.  He is perhaps best known as an ideologically conservative activist, and had previously been involved in the ACORN controversy, also involving selectively edited videos.

It is also no surprise that Bill O’Reilly on the Fox News Channel called for Sherrod’s resignation shortly after the edited video was posted.  Bill O’Reilly and Fox News in general have a strong ideological bent that colors everything they say.

The Emergence of a “New Establishment”

Several events in the last few years - including the election of Barack Obama as US President, the rise of the Tea Party movement, and the SEC charges against Goldman Sachs - have convinced me that there is a profound changing of the order underway in US society.   We are seeing the emergence of what, for lack of a better term, I will call a New Establishment.

The existence of something like the establishment is a quaint kind of notion, seemingly a remnant from a far away time.  I put together my own definition, based on Wikipedia’s definition of the term: 

“The Establishment refers to the ruling group that defines the conventional social, political and economic principles of a society.  Its members do not just represent the centers of official power - though they are certainly part of it - but rather the whole matrix of official and social relations within which power is exercised.  Most stable communities of social animals, including humans, have such a visible or invisible ruling group.”

Over the centuries, members of the establishment have come from various centers of power in society, including the church, nobility, feudal lords, the upper classes, the military, politicians, industrialists, financiers and media figures.  In democratic countries, no one group can be said to rule the establishment, which typically represents different segments of society.  

Not all groups are equally represented, and some segments feel left out altogether.  To better appreciate the value people place in being part of the establishment, just consider the fierce social, political and at times armed battles that have been fought through the ages between the groups in control, and those on the outside trying to break in.

What are the Key Qualities of a Great City?

I have always lived in or around cities.  I was born in Havana, where I spent my first fifteen and a half years.  My family then moved to Chicago, where I went to school for the next ten years.  In 1970 I moved to the New York area and have lived there ever since, including 15 years in New York City.

It is thus not surprising that I have become so interested in smart cities initiatives, that is, how to leverage technology-based innovations to help us better understand and improve the way urban areas work.

A major reason why smart cities has become such a hot topic is the rapid urbanization of the planet.  In 1900, about 13 percent of the world’s population lived in cities.  That number is now around 50 percent.  By 2050, over 70 percent of the world’s population will be in cities.  This unprecedented global urbanization is one of the biggest challenges facing everyone responsible for managing city functions, from mayors and police chiefs, to economic planners and school administrators. 

The challenges are enormous.  Urban ecosystems are extremely complex because they are composed of many different kinds of functions and intricate organizations.  A city is essentially a system of systems, and it is the interactions and interdependencies of its many parts that makes it so dynamic and unpredictable.  Their complexity will increase significantly given the expected urban growth over the next decades.  This is why we are now looking at the use of digital technologies, information-based intelligence and sophisticated modeling and simulation to help us better manage the complex challenges involved in the daily life of a city, - e.g, education, health, safety, commerce, transportation and entertainment.

Cities are also particularly interesting complex systems to study and model. What makes cities so fascinating is, - to state the obvious, - the presence of people.  Excellent public infrastructures and services are essential for a good city, but they are not sufficient.  A truly great city needs to be an appealing place to live.  It needs to attract and retain a large pool of local, national and international talent.  Liveability or quality of life is therefore the lifeblood of a good, let alone a great city.

Why are Tea Party Supporters So Angry?

A few weeks ago, the New York Times published the results of a national survey of Tea Party supporters conducted jointly with CBS News. 

The Tea Party is generally described as a populist protest movement that emerged in the US in early 2009.  Given the acute economic pain inflicted on so many by the ongoing financial crisis - e.g., increased unemployment, housing foreclosures and personal bankruptcies - it would be perfectly understandable if the people most hurt by the crisis formed the core of the Tea Party.

But the NYT/CBS poll reveals a very different story, succinctly summarized in the title of this follow-up Times article, Tea Party Supporters Doing Fine, but Angry Nonetheless: “The Tea Party supporters now taking to the streets aren’t the ones feeling the pain. . .   they are better educated and wealthier than the general public.  They are just as likely to be employed, and more likely to describe their economic situation as very or fairly good.”

The Healthcare Reform Debates

The ongoing US healthcare debates - or is civil war a better description? - remind me how incredibly hard it is to bring about disruptive transformations of any kind. 

In my experience, organizing disruptive transformational efforts is very difficult.  I learned this first-hand at IBM with efforts like the Internet initiative in 1996 and the Linux initiative in 2000.  Given that the organizational complexities go way, way up with the size and scope of the initiative, I am not surprised how incredibly difficult it has been to try to bring about the badly needed transformation of healthcare across the whole country.

A transformational initiative is subject to very different organizational dynamics from more incremental ones.  With incremental initiatives, you are looking to improve something that already exists in the marketplace - e.g., better products and services, higher customer satisfaction, increased overall efficiency.  Because you are improving something with a history, there is lots of information that can be analyzed to estimate the impact of the improvements on the business.  You can make a case for the improvements based on quantitative, fact-based, rational arguments.

Not so for initiatives based on disruptive technologies or ideas.  Disruptive transformations are, indeed, disruptive.  They are a break from the past, either because past approaches no longer work and are getting us into deep trouble; because a new technology or idea now offers us much better opportunities; or both.  But, while the changes might be absolutely essential, it is important to keep in mind that you are asking people to move from something that, while imperfect and flawed, they are familiar with, into unknown, most likely uncharted territory.

CNN, Latinos and Brand Values

A few weeks ago CNN broadcast Latino in America, a two-hour documentary that explored “how Latinos are reshaping our communities and culture and forcing a nation of immigrants to rediscover what it means to be an American.”  The documentary was reported by Soledad O’brien, a highly regarded CNN anchor and special correspondent who in 2008 reported the similar Black in America documentary. 

The US has over 50 millions Latinos, and by 2050 the US Latino population is expected to triple.  Latino in America portrays this incredibly complex, diverse, fast-growing community through a series of individual stories.  CNN calls it:

“. . . an ambitious documentary initiative [that] examines the growing diversity of America, revealing insight into a changing nation on the eve of the U.S. census that is expected to officially confirm that Latino Americans are the largest minority group within the country.”

It later adds:

“As the face of America changes profoundly, CNN continues to demonstrate that we are the only cable news network dedicated to delivering a diversity of opinions and coverage,” said Jon Klein, president CNN/U.S. “This landmark series will showcase dramatic personal stories from across the sweep of Latino-American society, and move the dialogue well beyond limited partisan discussions of immigration.”

Latino in America received a number of positive reviews, thanks in large part to the excellent work of Soledad O’Brien.  But Jon Klein’s attempt to move the dialogue beyond immigration has not fared so well.

Designing a Smart Healthcare System

On October 1 and 2 IBM held its second global Smarter Cities conference in New York City.  The first such conference was held in Berlin this past June, and the third will be held in Shanghai next year.

As was the case with Berlin, the New York Smarter Cities event had a very impressive agenda.  It included talks by IBM Chairman and CEO Sam Palmisano, New York City mayor Michael Bloomberg, and Melody Barnes, Director of the White House Domestic Policy Council.  The agenda also included panels with governors, mayors, and leaders of cultural institutions. 

In addition, there were break-out discussions to enable participants to share their experiences on what it takes to build a smarter city in six key areas: transportation, education, public safety, energy and utilities, government services and healthcare.  I helped organize and moderated the healthcare session.  Our panel included Denis Cortese - CEO and President of the Mayo Clinic; Ronald Paulus - Chief Technology and Innovation Officer at the Geisinger Health System; Chris Coburn - Executive Director of Innovations at the Cleveland Clinic; and Armando Ahued Ortega - Health Secretary of Mexico City.

Reflections from Another Part of the World and a Different Side of My Brain

I spent the first week of September in Chile and Argentina.  Three yeas have elapsed since I last visited Santiago, and I have not been to Buenos Aires for almost four years.  It was very good to be back in these two very nice cities.

I love to travel in Spanish speaking countries, - I go to Spain and Mexico from time to time in addition to Argentina and Chile.  The reason is not just because the people are so wonderful.  After all, in my experience, the people have been very nice in just about all countries I have been to around the world.  But, being totally immersed for days on end in my native language, is a particularly pleasurable experience, and one that, as I have thought about it, is not only personally appealing but also important to my mental health.  Let me explain.

It is well accepted that a good physical exercise plan should include different kinds of workouts, some focused on aerobics to increase cardiovascular endurance, and some anaerobic in nature to strengthen our muscles.  In addition to its benefits on our physical health, a regime of exercise also improves our mental health as well as helping to reduce depression.But, advances in brain sciences have begun to show the importance of also exercising our mental faculties.  Throughout our lives, our brains need stimulation to be healthy, in the same way that our bodies need physical exercise.  A lack of mental exercise and stimulation can result in severe problems, from the time we are born to old age.

I am convinced that as we learn more about the workings of our brains, we will learn how different kinds of stimulation best help different parts of our brain, much as we have learned how to best exercise different parts of our bodies.  Furthermore, I am sure that future advances in functional magnetic resonance imaging will show that for those of us who were immersed in different languages at different times in our lives, we can best reach feelings and concepts stored in our brain by using the language were were speaking at the time we experienced and learned them.

The Health Care Debates, Tribalism and The Golden Rule

Earlier this summer, I was in Berlin to participate in a Smarter Cities conference hosted by IBM.  I had not been to Berlin in a while, and was looking forward to seeing it, especially since it is one of my daughter’s favorite cities in the world.  I was not disappointed.  Berlin is a very nice city indeed, with lots to see and do, full of young people and positive energy.

But, you cannot visit Berlin and not be struck by its history, especially if you are Jewish.  Its Memorial for the Murdered Jews of Europe is haunting in its simplicity.  Newsreel images of Berlin Nazi rallies sweep through your mind.  And a question keeps coming up.  What happened?

Richard von Weiszacker, - who was mayor of the then West Berlin from 1981 to1984, and President of Germany from 1984 to1994, which included the fall of the Berlin Wall and the reunification of  East and West Germany, - spoke at the conference on the history of Berlin. He reminded us that before the Nazis came to power in the 1930s, the city was the intellectual center of the world.  People everywhere learned German to be able to read the best textbooks and academic journals in their fields, much as they do now with English.  How could such an advanced civilization engage in such monstrous acts?

Numerous books have analyzed this question.  The answer that makes the most sense to me is rather simple.  Civilization is a relatively recent and thin veneer on human behavior.  People are capable of terrible actions against their fellow men, especially when they are under severe stress and are incited to blame others for their fears by skillful demagogues.

Lessons from the "Beer Summit": To Err is Human . . .

There are a number of important lessons, if not downright teachable moments, in the July 16 arrest of Professor Henry Louis Gates by Cambridge Police Sargeant James Crowley, and the subsequent involvement of President Barack Obama when he said that the Cambridge Police acted stupidly in arresting Professor Gates in his own home.

Clearly, race relations, especially the long history of racial profiling by the police, are a major part of the backdrop for this case.  But perhaps, race acted more as the kindling that caused the relatively minor July 16 incident to flare out of control leading to Gates' arrest.  And then again, the race kindling caused the incident to explode across the nation after the President’s remarks on the arrest. 

All three principals in the case, Prof. Gates, Sgt. Crowley and President Obama, have excellent records when it comes to race relations.  Rather than playing key roles in a racially tinged drama, they are role models for how people should behave in a well-functioning multi-cultural, multi-racial society.

Looking at it in retrospect, the whole incident has the making of a Greek tragedy.  Three good, highly professional, and disciplined men, each made an out-of-character mistake and said and did things that they should not have.  Why?  Because like all human, our emotions sometimes get the better of us and get us in trouble.