World War II, although a tragedy, accounted for a dramatic surge in applied technology that changed the American way of life. I posit that COVID-19 will do the same. Prior to WWII, not only were the very big cannons horse-drawn, they had to be aimed by a room full of people. Using slide rules (remember them) and hand calculations to account for the wind direction, the humidity, the distance to target, and multiple other variables, these mathematicians determined how to set the cannons which could fire shells as big as 240 pounds s to hit their targets. The military went to the CEO of a company and asked if his company could build a mechanical device to do what that room full of “human computers” as they were called, were doing. That company succeeded. When he later testified before congress, that CEO was asked what he thought the total world market for such a machine would be. Thomas Watson, CEO of IBM, claimed maybe four or five of these new “computers” would ever be sold. We know now how wrong that assessment would prove to be.
Man is spurred forward by adversity. The attack on Pearl Harbor was and is a very somber moment of history, but it was also the impetus for a new era of human ingenuity. Computers are but one Pearl Harbor industry impact. Penicillin had been accidently discovered by Alexander Fleming while he was searching for a cure to the Spanish Flu. Up until the 1940s, the drug had been difficult to produce in mass quantities. Solving mass-production of penicillin became a priority during war time, and Pfizer figured out how to make massive doses using deep tank fermentation. That birthed the pharmacy industry.
In Santa Fe, NM, several thousand men passed through a small shop located at 106 W San Francisco Street where they gave up their passports and personal identification. They would go from there to Los Alamos for the Manhattan Project to develop the atomic bomb. That spawned the nuclear energy industry: nuclear medicine for treating cancer, space exploration, criminal investigation, and agriculture.
There are similar stories about the development of blood transfusion technology, radar, jet engines, and other technologies which were developed during that time and which have transformed life in America. All developed as a result of the needs and priorities of the American government responding to Pearl Harbor.
In my opinion, COVID may be the Pearl Harbor moment of modern times.
The energy industry dwarfs all other industries. Total annual revenues of $7 trillion plus far outweigh the media industry, for example. All media including the business journals, TV, movies, printed and electronic books and periodicals is less than $2 trillion. With the world emphasis on climate change, I believe that the energy industry may undergo a dramatic change.
BP Oil released their forecast of oil consumption for the next 30 years. BP expects the world is at peak oil demand today, and that oil consumption will decline for the next 30 years. It is not just that consumers are embracing electric vehicles and alternative energy, although that is a big part of the decline. There are other factors at play. It takes bacteria around two million years to create the oil that is drilled out of the ground. Today, there are companies that can make specialty petroleum products in a matter of days. There are bioengineering companies that are building DNA to make those special petroleum products without ever using oil drilled from the ground.
Surveys show that over 30 percent of office workers do not want to return to the office full time. They want to work at least part of the time remotely. Five percent say if ordered back to the office full time, they will quit without having another job. The other 25 percent say they will return to the office, but immediately start looking for another job. That may have a significant impact on the real estate markets – both office space and homes, where some will look to convert some space for remote office work.
The banking and financial services industries are seeing technology replace some of the old-fashioned banking and financial services. This may just be beginning. As blockchain technology moves into these industries, it will not be as digital currency but as shared ledgers making significant productivity gains. Cash is already disappearing, replaced by smartphone apps. The robo-advisors in the financial services industry are still a young technology, and as they improve, they could be as unsettling to financial services as the discount brokers were to full service brokers in the 1970s and 1980s.
R2D2 and C3PO were characters in Star Wars, but they may not be so farfetched in 2030. Companies are developing robots to care for the elderly. Robots are already being employed to assist in nursing, health management, elder care, and even in the homes of the disabled. Robots are helping the elderly get out of bed, brush their teeth, and use the facilities. The T-HRs robots can play the violin and the trumpet. The Kengo robot can do push-up, pull ups, backbends and has six times the degree of movement that a human being has. This is just the beginning of robotic development.
There is reason to believe that we are just at the beginning of a significant technological explosion that will dramatically improve life, just as the technologies that followed Pearl Harbor and World War II did for the decades that followed.