The Great Mystery of Economic Growth – How taxpayers benefit from the actual cause of economic growth
INTRODUCTION
This connects an important human need; economic growth, to its cause – new knowledge.
Why do civilizations become wealthy?
At first glance, the answer seems obvious. Technology. Industry. Capitalism. Entrepreneurship. Markets. Hard work.
We are taught in school that the modern world was created by the great industrial revolutions of the last two centuries. We remember names like Thomas Edison, Henry Ford, Andrew Carnegie, John D. Rockefeller, and Alexander Graham Bell — individuals whose inventions and industries transformed civilization.
And indeed, technology revolutions changed the world. Over the last two hundred years, human living standards exploded upward by amounts unprecedented in history. Poverty declined. Lifespans increased. Entirely new industries emerged. Human beings gained powers once unimaginable.
The modern world was built. But this raises a deeper question that history classes rarely ask:
What caused the technology revolutions themselves?
That question matters enormously because economic growth is not simply an academic topic. It shapes our lives. Our jobs. Our income. Our opportunities. Our children’s future.
Without sustained economic growth, societies stagnate. Opportunity narrows. Debt rises. Competition intensifies. Social tension grows. Entire nations can slowly decline while barely understanding why it is happening.
So, understanding the true source of economic growth may be one of the most important questions civilization can ask.
Surprisingly, the answer is not what most people think.
THE GREAT PARADOX OF HUMAN PROGRESS
The technologies that transformed civilization did not emerge from nowhere. They were built upon something deeper: Scientific discoveries about the natural world.
And here is the truly remarkable part: At the moment, they were discovered, many of the most important ideas in human history had no obvious commercial value whatsoever. No one could monetize Isaac Newton’s laws of motion when they were first developed. James Clerk Maxwell did not invent electromagnetic theory to create smartphones. Quantum mechanics was not developed to build computers. The structure of DNA was not discovered to launch the biotechnology industry.
In fact, the most important discoveries in history often appeared economically useless at first. And yet those “worthless” ideas eventually created enormous wealth for civilization. This website explores that extraordinary paradox:
How human curiosity, exploration, science, engineering, and discovery created the modern world.
The Watt Steam Engine invented by Scottish chemist, James Watt, was very inefficient, 0.5%, The advancement of steam engines was inspired by heat resistant materials and the theory of heat to mechanical work. Nicolás Pérez.
WHAT HISTORY LEFT OUT
Most of us were taught the story of industrialization. Far fewer were taught the upstream story behind it.
We learned about factories. But not enough about the discoveries that made factories possible. We learned about products. But not enough about the ideas that made the products possible. We learned about wealth creation. But not enough about the mysterious process through which entirely new forms of wealth come into existence.
That missing story matters today more than ever. Because many of the forces shaping our future — economic stagnation, declining scientific ambition, rising geopolitical competition, educational decline, technological disruption, energy challenges, and even cultural pessimism — are deeply connected to whether societies continue investing in discovery.
Civilizations do not advance simply by consuming wealth. They advance by creating new knowledge that expands what humanity can do.
THE QUESTIONS THAT SHAPE THE FUTURE
This website is organized around a series of interconnected questions: What actually causes long-term economic growth? Why did technology revolutions occur when they did? Why are scientific discoveries so economically powerful despite initially appearing commercially worthless? Why did the United States rise to global dominance after World War II? Why has investment in discovery declined over the last half century? What happens to civilizations that stop exploring?
And perhaps most importantly: Can a society preserve prosperity if it gradually loses the culture that created that prosperity in the first place?
These are not merely academic questions. They concern the future of civilization itself.
If you believe technology revolutions caused economic growth, then this begs a question: What is the cause of technology revolutions? The answer to it is somewhat surprising. All technology revolutions, and hence economic growth, were caused by human activities that have no commercial value. You might wonder how is this even possible. It’s not only possible, but it is, in fact, true. In a sense, worthless things created enormous wealth in the world. It’s a remarkable fact of human history, which is explored on this website.
The remarkable growth in the US standard of living that followed a similar pattern as the United Kingdom
What is more, this same cause enabled the US to become a world economic and military power after WWII. During and after WWII until about 1980, there were substantial U.S. government investments in the development of people through education and numerous science-inspired inventions. This investment strategy created the technologies that we all enjoy and still improve upon to this day. However, U.S. government investment in research and development over the last half-century has declined unabated, which is creating significant risks in our ability to shape our future. Moreover, this trend has mostly gone unnoticed. Another purpose of this web site is to make you aware that this trend is reducing opportunities for economic growth.
AN INVITATION
The articles and essays on this website explore science, technology, economics, culture, climate, history, and the forces that shape human progress. Some ideas presented here challenge conventional assumptions. Others ask uncomfortable questions. But all are motivated by a common belief: The truth matters and human progress depends fundamentally on our willingness to venture into the unknown to discover the truth.
Every major technology revolution began as an act of imagination. Every transformative discovery began with uncertainty. And every civilization that advanced the human condition did so because some people were willing to explore what did not yet exist.
The future will belong to societies that still have the courage to do that.
Before you explore this web site, I suggest that you listen to a talk I gave at the MIT Physics Colloquium on September 5th, 2019, click here, which will introduce you to the actual cause of economic growth. After listening to my talk, please feel free to comment on my blog. Through a shared understanding of history, I believe we can work together to support the actual cause of economic growth to ensure a prosperous future and avoid stagnation.
If you care about your children’s future, the future of their children, and the future of this great nation, then this web site will provide you with the knowledge and a plan as to how we can ensure that prosperity will continue for future generations. I cannot think of a more critical issue that will directly affect our future. Can you?
Welcome to the journey.
Hipparchus of Nicaea was a Greek astronomer, geographer, and mathematician born in 190 BC. The invention of the telescope was inspired by the birth of the science of optics first explored by Zacharias Janssen during the 16th century. His work created two of the great adventures in human history. One into the world of the very small and the other on a grand scale to study the history of the universe.
Mission Statement
Most people would be skeptical if I said to them that the great wealth the world enjoys today was caused by things having no commercial value. How is this even possible? The mission of this website is to convince you that this is in fact true.
The Great Mystery of Economic Growth challenges commonly held beliefs regarding the cause of economic growth. My goal is to inspire people to embrace a new understanding of how the modern world was created along with its 200 years of extraordinary prosperity.
This represents 200 years of wealth creation from technological revolutions caused by the discovery of new materials and new knowledge of how the natural world works.
In my career of over four decades leading technology organizations and overseeing billion-dollar portfolios of research and development (R&D), I have witnessed first-hand how strong economic performance depends critically on investing in people and R&D. And, as a student of the history of science and technology, I understand how true trailblazers acquired great wealth that strongly depended on technology revolutions directly caused by the discovery of unique materials and new scientific, engineering, and mathematical knowledge. However, over the last half-century, our national priorities have shifted away from discovery, which has changed our culture and is now affecting our ability to create abundant opportunities for future economic growth.
I am passionate about pursuing the truth because it is the only reliable way we have to create our future. If you care about your children’s future, the future of their children, and the future of this great nation, then this website will provide you with knowledge and a plan as to how we can ensure that prosperity can continue for future generations.
John Parmentola has built a highly distinguished career over four decades as an entrepreneur, inventor, innovator, a pioneer in the founding of new fields of research, and leader of complex research and development organizations with broad experience in the private sector, academia and high-level positions within the federal government and defense community.
Currently, he is a consultant to one of the world’s leading think tanks, The RAND Corporation, where he works on defense, energy, and science and technology assessment, strategy, and planning issues for government agencies, both domestic and foreign. He also does work on a volunteer basis for the National Academy of Sciences.
As Senior Vice President at General Atomics, he led the California-based technology company’s Energy and Advanced Concepts Group, focusing on energy, defense, advanced computing, and management of DIII-D National Fusion Facility, the largest such facility in the United States (U.S.). The Group’s innovations include a revolutionary waste-burning compact advanced reactor (EM2), meltdown proof nuclear fuel, setting a new land-speed record with magnetic-levitation systems, and building the world’s most powerful superconducting electromagnet for the largest fusion experimental facility in the world, ITER. While at GA, Dr. Parmentola invented a revolutionary new airship that could provide wireless communications for 1.4 billion people worldwide currently without this capability.
As a distinguished Senior Executive in the Pentagon, Dr. Parmentola served as Director for Research and Laboratory Management for the U.S. Army, directing lab management policy for 12,000 employees, infrastructure and security for all 21 Army laboratories and research, development and engineering centers, and led Base Realignment and Closure efforts for the Army. He also had responsibility for a $1-billion combined budget for basic and applied research, manufacturing technologies, small business innovative research, and high-performance computing.
During his tenure with the Army, Dr. Parmentola led the creation and development of several remarkable research centers. One of them, the Institute of Creative Technologies at the University of Southern California, won an Oscar for its technical contributions to cinematography. This is the work of Academy Awardee, Paul Debevec. Another, the Institute for Collaborative Biotechnologies at the University of California Santa Barbara, supported the work of Frances Arnold, who won the 2018 Nobel Prize in Chemistry, the 5th woman in history to receive the prize. Tasked by General Eric Shinseki, he led the creation of a new “Science Fair for the Nation,” eCybermission. For the past 17 years, this competition has inspired middle and high school students nationwide (including U.S. territories and possessions) in science, technology, engineering, and mathematics education. Also, while serving in the Pentagon, Dr. Parmentola conceived and led the development of the world’s first robotic dog that could see and sniff explosives. This remarkable robotic system saved the lives of soldiers in both Iraq and Afghanistan and is one of the Army’s Ten Greatest Inventions.
As Chief Scientist, Dr. Parmentola served as the science and technology advisor to the Chief Financial Officer of the U.S. Department of Energy (DOE), where he provided technical, budgetary, and programmatic advice to DOE leaders for more than $7B in science and technology investments.
He also co-founded the Advanced Systems and Concepts Office of the Defense Threat Reduction Agency to address significant national challenges concerning the threat of weapons of mass destruction. Based upon a request from Ambassador James Goodby, he led two major studies on the Comprehensive Test Ban Treaty for President Clinton. He received official confirmation from General John Shalikashvili that these studies contributed to the security of the nation
He has been on the faculty of M.I.T., West Virginia University, a Fellow of the John F. Kennedy School of Government and a Principal Scientist for Strategic Command, Control, and Communications at the MITRE Corporation. While working for these organizations, he made contributions to fundamental science in high-energy physics and nuclear physics, strategic nuclear operations, and led the creation and development of the world’s most sensitive mobile gravity gradiometer for arms control verification applications. This device is used today for the exploration of oil and minerals and the discovery of diamond deposits.
His work in the private sector includes the co-founding of Travel Media Corp. (TMC) with his wife, Jane Langridge, serving as TMC’s chief financial officer, and chief technology officer for over 30 years. TMC specialized in the production and distribution of in-room magazines for leading hotels and resorts, including Marriott, Renaissance, Hyatt, Hilton, Radisson and Westin throughout the Caribbean, Latin America and Hawaii. TMC also created and published Expressions for American Express in Spanish and Portuguese for their Latin and South American markets. Other TMC clients included Air Aruba Airlines and Copa Airlines of Panama.
Born in the Bronx, New York, Dr. Parmentola earned a bachelor’s of science in physics cum laude from Polytechnic Institute of Brooklyn, and his doctorate in physics from MIT. Dr. Parmentola received the 2007 Presidential Rank Award for Meritorious Executive from President George W. Bush for his service to the Department of the Army. He was also an Air Force Intelligence Agency nominee for the 1996 R. V. Jones Award of the Central Intelligence Agency for his work in arms control verification, and a recipient of the Outstanding Civilian Service Award and the Superior Civilian Service Award for his many contributions to the U.S. Army. He is an Honorary Member of the U.S. Army STs, a Fellow of the American Association for the Advancement of Science and a recipient of the U.S. Army 10 Greatest Inventions Award, the Alfred Raymond Prize and the Sigma XI Research Award. He has presented and published more than 500 speeches, papers, and articles in science and technology policy and is the author of an authoritative book on space defense.
Speaker Requests
John Parmentola is available for public speaking and presentations.
Some speakers entertain, and others provide information. My goal is to inspire audiences by explaining the role of science, technology, engineering, and mathematics in our society, in shaping our future and affecting our lives. Over my career, I have presented well-over 500 talks at major international conferences, symposia, and meetings to widely diverse audiences, both large and small, on a wide range of thought-provoking topics all over the world. I have appeared on the Public Broadcasting Station, numerous TV interviews, The National Press Club, The White House Chronicles, The Presidential Classroom, and countless other public speaking venues.
The topics of my talks range from our energy future, K-12 STEM education, the frontiers of science and technology in the fields of virtual reality, nanotechnology, biotechnology, flexible electronics, networks and communications, and network science to strategic defense, directed energy weapons, arms control, nuclear proliferation, international human rights issues, the role of venture capital in government, food security, robotics, the science of all living things, leveraging 4 billion years of evolution, and numerous other topics. You can find several of my recorded talks on this website.
My current focus is on the fundamental importance of science and technology in fulfilling a very important human need, economic growth, and its future. My most recent talks on this topic are:
The Future of Economic Growth, The University of California at Santa Cruz, April 15th, 2019
The Role of Human Curiosity in the Creation and the Development of the Modern World, U.S. Army Research Office, Research Triangle Park, NC, July 9th, 2019
The Great Mystery of Economic Growth, Massachusetts, Institute of Technology, Cambridge, MA, September 5th, 2019
While working for General Atomics, I led a group of extraordinary people who designed a revolutionary nuclear reactor that had ambitious goals. It was specially designed to be economically competitive with natural gas, inherently safe, proliferation-resistant, and burn the vast amounts of nuclear waste we have as an energy source. Energy Multiplier Module (EM2) is the highest power most compact fast-neutron gas-cooled reactor ever designed. It’s about the size of a school bus. EM2 is designed to be manufacturable in a factory and transported by truck in the U.S. Highway system to a site for deployment. The critical element in EM2 that makes it revolutionary is its ceramic cladding and fuel, which are both temperature and radiation-resistant. The temperature resistance enables a meltdown proof design, and the radiation resistance allows the fuel to burn more than six times longer (30 years) than conventional reactors. Both these features also reduce the amount of nuclear waste produced by an astonishing amount, 80%. Its high operating temperature also lowers the price of electricity by 40% relative to conventional light-water reactors. The above videos describe the design of EM2 while the Physics Today article explains the main issues surrounding the challenges of nuclear power.
While Senior Vice President at General Atomics, a very talented scientist, Tina Back, was experimenting with a new material that could make nuclear reactors inherently safe. The discovery of new materials with the right characteristics can push out the performance of technologies. However, new knowledge is also needed to exploit them. This unique material is silicon carbide composite, a ceramic material that is both temperature and radiation-resistant. The “melt’ temperature of this material was very high, which allowed reactors designs such that the reactor fuel could never melt. We later discovered that the material is resistant to reaction with water, so it could also be used to improve the safety and performance of the current fleet of light-water reactors. I once explained this new material to Senator Dianne Feinstein. She immediately recognized the potential to improve public safety. Through legislation, she proposed a new Department of Energy program in Accident Tolerant Fuel to advance the safety of nuclear reactors. Through this program, work continues on this remarkable material. The above article provides some background on this effort.
While working at General Atomics, I became aware that existing National test facilities to advance nuclear power were all outdated, overly subscribed, and had limited performance to explore new materials and reactor designs. Inspired by this challenge, I came up with a new concept, The Versatile Test Reactor. The design of this novel test reactor would accelerate the testing of new materials, both fuels, and cladding. It would also allow experimentation of different reactor designs at one major user facility. I presented testimony before Congress on this new concept and worked with Congress on passing legislation to fund this much needed National facility to advance nuclear power. The site for this high-performance test facility will be Idaho National Laboratory. The above video is my Congressional testimony, which initiated this new effort.
While at General Atomics, I was responsible for the largest fusion reactor facility in the US. I led the transition of this facility to an international user facility with an emphasis on the development of new instrumentation to advance the science of high-temperature plasmas to support the practical demonstration of fusion power. I also led the team that won the competition to develop the largest and most powerful pulsed magnet in the world, which is the most critical technology for ITER. ITER, located in Cadarache, France, will be the most significant experimental fusion reactor ever built involving six nations and the European Union. The goal of ITER is to demonstrate the feasibility of fusion power. The above video is a public discussion of fusion power, and the American Physical Society article explains the issues surrounding the different challenges of fission and fusion power.
Creation of U.S. Army STEM
Education Programs
eCybermission
While Director for U.S. Army Research and Laboratory Management, I was tasked by U.S. Army Chief of Staff, General Eric Shinseki, to create a new Science Fair for the Nation. I led the team that created this unique web-based competition, which has been inspiring students in grades 6-9 in all 50 States, U.S. Territories, and Possessions since 2002. In addition to the technical and logistical challenges that were required to create this competition, I had to work with Congress to pass new laws to allow the winners to receive awards. These laws were eventually expanded by Congress to apply to all the military services. The above video explains the nature of this unique science, technology, engineering, and mathematics competition.
Also, while Director for U.S. Army Research and Laboratory Management, I led a team to organize, expand, and create the U.S. Army Educational Outreach Program. This program is the largest in the Department of Defense, which reaches out to our youth as well as teachers from all economic, gender, and racial backgrounds across all 50 States, U.S. Territories, and Possessions, including U.S. Department of Defense schools around the world. It is a model of excellence in reaching out to our precious youth to enable them to achieve educational goals that they cannot accomplish through our K-12 school system.
Creation of Research
Centers at the Frontiers of Science
Also, while Director for U.S. Army Research and Laboratory Management, I led the creation and management of several unique research centers at the frontiers of science and technology in the fields of virtual reality systems, biotechnology, nanotechnology, networks, and information science, and flexible display technology and manufacturing.
One of these Centers, The Institute for Creative Technologies at the University of Southern California, was awarded an Academy Award for its technical contributions to cinematography. Paul Debevec developed a unique technology that enables the insertion of people into existing filmed scenes. The people inserted into the scenes visually appear natural. Both Spiderman and Superman movies used this unique high-fidelity technology. This Center also led to the development of the high-tech company Oculus by founder Palmer Lucky who sold it to Facebook for $2 billion.
Another Center, The Institute for Collaborative Biotechnologies at the University of California, Santa Barbara, with collaborative partners Caltech and MIT, supported the early-stage research work of Dr. Francis Arnold of Caltech. She won the 2018 Nobel Prize in Chemistry, the 5th woman in history to receive this award. Dr. Arnold developed a process that exploits microorganisms for a revolutionary way of manufacturing substances by directing their evolution.
Finally, The Institute for Soldier Nanotechnologies at MIT, through the work of Tim Swager, developed a revolutionary handheld explosive detector that inspired the creation of the world’s first robotic dog that could see and sniff. This unique system saved many lives on the battlefields of Iraq and Afghanistan.
While Executive Director of the Panel on Public Affairs of the American Physical Society (APS), my mentor, Professor Herman Feshbach of MIT, and I led the creation and expansion of the international human rights activities of the APS. Through these activities, the APS came to the aid of scientists in the U.S.S.R., Argentina, Philippines, Romania, Poland, and China. During this period, I participated in the famous Moscow Seminar of Collective Phenomena. This Seminar was an unauthorized activity of Refuseniks (Soviet citizens who were refused visas to leave the U.S.S.R.) censored by the Soviet government. Victor Brailovsky, the leader of the Moscow Refuseniks at the time, held the Seminar in his apartment. In 1979, during my visit to the U.S.S.R., I managed to smuggle an article out of the U.S.S.R. written by a Jewish mathematician, Grigori Freiman. On November 25, 1979, the article appeared in the Sunday New York Times Magazine. It described the systematic practice of quotas in mathematics used by the Soviets based upon the ethnicity of mathematicians. I also submitted testimony to the U.S. Congress and the Committee on Security and Cooperation in Europe on human rights violations in the U.S.S.R. The above links provide some background on these groundbreaking human rights activities.
Army Venture Capital
Initiative – OnPoint Technologies
While Director for U.S. Army Research and Laboratory Management, I was asked to create a venture capital corporation for the Army as a result of Congressional legislation. The notion of having an actual venture capital corporation in government seemed absurd. What does the government know about making a profit? How would one deal with conflicts of interest and political influence, which is pervasive throughout the government? Who would own such an entity, and how would it be funded? Would the Army have control over it, and in what way?
It was clear that the government would need a new approach to leveraging cutting-edge technology solutions from the private sector for Soldiers. With the help of my staff, we conducted a substantial amount of research into venture capital organizations. From our study, a unique way was adopted to form this new entity while limiting the influence of the traditional Army acquisition system. The corporation had no employees. It instead utilized a small Board of Trustees. A private sector firm managed the corporation and received an incentive when commercializing technology and transitioning it into the Army. This initiative was set up with primarily a one-time lump sum investment as an evergreen fund that had to use the money it made from its investments to fund itself. The entity, OnPoint Technologies, has had many successes, but like any venture capital operation, it has also had its share of failures. The above article explains the nature of this unique organization.
Research and Development Portfolio
Analysis for Government
The Department of the Army, like all government organizations, has no systematic way of measuring research and development (R&D) investment performance to facilitate budget decisions. Generally, simply spending the money required by law is the only success metric that typically matters. If a government organization does not spend its R&D budget by the end of the fiscal year as required by law, the next year, its budget is reduced. This mindless practice troubled me during my tenure with the Army. I became familiar with the 3rd Generation R&D Portfolio Analysis developed by the business consulting firm A.D. Little. It’s a potentially powerful consensus-building approach to managing a portfolio of R&D investments and can be used to determine progress and future funding policy. It enables the customers, users, and stakeholders of the R&D to make decisions about current and future investments. Little did I know when I started this activity that this approach would eventually be adopted in some form by many government agencies. Of course, given the tendency of organizations to protect themselves, this approach has been abused and misused by some organizations. The above article explains how this approach works and how it was adapted to more effectively utilize government investment of taxpayer dollars.
While I am a physicist by training, I have always been fascinated by the living world and in particular, the extraordinary materials and capabilities that have been the result of four billion years of evolution. I was asked by the National Academy of Engineering to write the above article, where I speculate on how the Army might leverage the results of 4 billion years of evolution.
One day while taking a shower, an idea came to me that there might be a connection between human-engineered and biologically evolved networks. Humans have created communication networks, transportation networks, financial networks, etc., however, in the living world there are networks represented as families, communities, towns, cities, the global village, and there are networks of social insects, schools of fish, flocks of birds, ecosystems, and so on. At a more fundamental level, there are cells that network to form tissue and tissue that networks to form organs and organs that network to form organisms. Even inside cells, there are networks of chemical processes that enable the process of metabolism. As I thought more deeply about this, networks of all sorts had common structural features, which suggested there may be an underlying science of networks. The above article is an interview I had during the early stages of this idea. The Wikipedia link describes my role in the field of network science. This exciting field continues to grow, and remarkable discoveries are being made every day all over the world.
While Senior Vice President at General Atomics, I inherited an ill-conceived Defense Advanced Research Project Agency program involving algae to produce oil to power combustion engines. The idea was to use the CO2 emissions from a local power company as food for algae growing in high-tech ponds. After analyzing the economics of this concept, it became clear that it was a total loser, and the real value was not the oil but the protein from the bulk composition of the algae. After analyzing the amino acid composition of the algae, it became clear that its composition was very similar to the protein in aqua-feed for fish farming. Given projected world population growth and increasing limitations of available protein to expand fish farming, growing algae in arid climates could supply protein for both land and ocean fish farming. The challenge is doing the risky research required to determine the optimal feed compositions with the proper amounts of algae protein at various stages of fish growth. The research to accomplish this appears to be too risky for the private sector, and government-funded R&D is not structurally organized to support this kind of research. Given the tremendous need and opportunity to help humanity, something should be done to explore this path to food security for the world. The above link provides some background on this effort.
During my tenure as Director for Army Research and Laboratory Management, I came up with the idea of creating the first robotic dog that could see and sniff explosives. This idea was inspired by the world’s most sensitive explosive detector invented by a remarkable team of scientists at the Institute for Soldier Nanotechnologies at MIT. The effort to develop the system in the Department of Defense involved an extraordinary group of individuals. The above article describes this effort, which set a record for the production of this remarkable system in 90 days. It saved Soldiers’ lives on the battlefields of Iraq and Afghanistan.
