Cultural Lag: When Innovation Moves Faster Than Regulation

Everybody loves Elon Musk. Well, everybody that’s not in the business of fossil fuels and other non renewable energy resources, that is. Earlier this year, Robert E. Murray of Murray Energy Corp, America’s largest privately owned coal company, took to calling Musk “a fraud” on CNBC. Musk made headlines, after taking to Twitter to fire back at Murray.

Real fraud going on is denial of climate science. As for “subsidies”, Tesla gets pennies on dollar vs coal. How about we both go to zero?

— Elon Musk (@elonmusk) October 10, 2016

Musk 1 | Murray 0

For many, it goes without saying that Musk is a disruptor in a world full of established and slow moving rules, regulations, and people, and Murray is hardly the most contentious of his opponents. In March of 2014 he squared off with Chris Christie and the state of New Jersey over his car’s sales rights, and a few years ago it was the Federal Aviation Administration (FFA) in relation to SpaceX. Just recently the LA Times reported that he’s challenging regulators to catch up with his driverless car technology, which he says is ready to hit the roads.

Technology is Moving Too Fast for Laws and Ethics

NASA Administrator Charles Bolden shaking hands with Elon Musk

Musk isn’t the only one that thinks government and its regulators need to speed up the process. Google made a similar claim in March of 2016, where they met with the Senate Commerce Committee alongside others in the auto industry such as General Motors, Delphi Automotive, and Lyft.

We’ve entered an era when major technology companies are hamstrung by legislature because laws and ethics just can’t keep pace with technology. Vivek Wadhwa, a Fellow at Arthur & Toni Rembe Rock Center for Corporate Governance, Stanford University, explains the ethical conundrum in MIT’s Technology Review:

“Employers can get into legal trouble if they ask interviewees about their religion, sexual preference, or political affiliation. Yet they can use social media to filter out job applicants based on their beliefs, looks, and habits. Laws forbid lenders from discriminating on the basis of race, gender, and sexuality. Yet they can refuse to give a loan to people whose Facebook friends have bad payment histories, if their work histories on LinkedIn don’t match their bios on Facebook, or if a computer algorithm judges them to be socially undesirable… These regulatory gaps exist because laws have not kept up with advances in technology. The gaps are getting wider as technology advances ever more rapidly.”

These gaps exist across the spectrum, and are widening in every industry affected by technology (which is literally just “every industry”). Soon enough, we will either consistently pass regulatory measures without sufficient information, possibly putting human lives on the line, or new tech will become so stifled that innovation dies out altogether, destroying humanity’s chance to cure social ills, create green power, etc. Damned if you do, damned if you don’t.

The Rising Stakes Demand Deeper Debates

The big problem is that technology is not only moving faster, it’s becoming exponentially more powerful and impactful. In the now, Musk’s claims that driverless cars are ready could disrupt multiple industries, challenging automakers and potentially costing 5 million in the transportation industries their jobs. Additional, the Internet of Things (IoT) is already changing the ways that we pay for things, but bitcoin and its technology could literally revolutionize global finance and variegated industries if regulators understood the blockchain better.

The stakes are even higher as we look toward the future. New, awesome, technology is emerging that promises extended life for the old, and healthy lives to the unborn. Transhumanism is integrating technology with human biology, and the dawn of artificial intelligence is on the horizon. Of course, the threats of overpopulation, genetic discrimination, implant complications, and the potentially dangerous “singularity” all demand consideration–but so does fact that the longer certain revolutionary technologies remain sidelined, the longer we are condemning people to potentially preventable death, illness, and discomfort.

Dolly the Clone Sheep

In a Council on Foreign Relations meeting in 2014, Joel Garreau, a Future Tense fellow at the New America Foundation, gave a speech in which he captures the feeling succinctly:

“For the first time in hundreds of thousands of years, our technologies are not aimed outwards at modifying our environment—increasingly, they’re aimed inward, at modifying our minds, our memories, our metabolisms, our personalities, our kids… If you can do all that, you’re in the stunning position of being the first species to take control of your own evolution—not in some distant science fiction future, but right now, on our watch… if we’re waiting for the House Judiciary to solve our problems, we’re toast… they’re talking about spending 5-10 years to regulate technologies that are already 5-10 years old. I see nothing good coming from that … I think that [kind of system of regulation] is doomed.”

Regulation From the Ground Up?

Here’s a perspective. When cellphones began getting popular, it was the dawn of the new millennium, and everybody had a grey Nokia brick. It wasn’t long before talking and texting while driving became a problem–but it was still 2008, ten years after the invention of SMS text messaging that first state passed texting while driving laws, and federal laws restricting cellphone usage while driving weren’t passed in the U.S. until 2012. The advent of bluetooth threw a wrench in the mix, as initially it was seen as a safe alternative to driving with cellphone in hand, even though it is just as bad. Now none of any of that might matter at all anymore, if Elon Musk is right about his driverless car.

This is a perfect example of how technology builds off of itself quickly, and how poorly humans are at reacting to it. Innovation moves at an exponential rate, while human acceptance of it remains at a constant. There’s just no way that a limited governing body of humans can be knowledgeable of and keen on every issue in every industry to the point that they can regulate it themselves. This is why people like Garreau think governance should come from the “ground up” in a sort of industry self-regulation. He believes that those hobbyists passionate enough to pioneer an industry generally care about it enough to guide it morally.

Jason Koebler, writing for Motherboard, points out that the downside is when technologies become too big for the government to ignore. Generally, they turn to outside sources for their expertise, and it’s not the passionate hobbyists–it’s the big boys.

“Once politicians look to the “industry” to make formal regulations,” he says, “they tend to turn to the major players—the Googles and Facebooks and Comcasts of the world—and those companies are looking out for their bottom line… we’ve already seen inklings that drone rules might be written by those who already dominate the industry, and we’ve seen an FDA e-cigarette rule proposal where the barrier to entry to creating a new e-cig company is so high that only already established firms can afford to stay in the marketplace.”

As such, innovation is stifled because access to the field becomes limited. The gatekeepers effectively squash outside competition, and with it, any progress that may come from foreign sources. Regulation kills the pace of innovation, which is precisely the problem the outside parties were brought in to solve in the first place. If the hobbyists, passionate and loyal to the industry they’re thriving in, could truly draw incorruptible regulatory lines, Garreau’s idea of third party regulation would be great–but unfortunately, this is not the case.

Stunt Innovation or Risk Human Life?

The conundrum stands thus: humans take time to process technological change at a constant rate, but technological change is accelerating at an exponential rate. The way things stand, there’s no real fix for this. Governments rely on control and consistency to function, and the status quo doesn’t work well with a world that is hell bent on change.

Perhaps proponents of decentralization will win out in the future–only time will tell. What’s for sure is that something will need to change, and it needs to change soon.

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Welcome Andrew Heikkila, a tech enthusiast and writer from Boise, Idaho, and a new contributor to Innovation Excellence. He also writes for Tech Crunch. You can follow him @AndyO_TheHammer