The Chief Minister Datuk Patinggi (Dr) Abang Johari Tun Openg’s comment on technological policy direction in local economy in general is rather misunderstanding – I’m afraid. He keeps telling us how technologies by government policies going to change the state economy in the next couple of years – and this are not true.
The long t rend has been growth since the first industrial revolution (steam, railways) and through the years of the second (electricity, internal combustion engine, airplanes) and third industrial revolution (computers, internet, biotech) with expectation that these revolutions will grow the economy and improve our living standards. Yet, the first, second and third industrial revolution were not accompanied by government policies and those making the products of the new technological revolution were still able to buy what was produced.
Thus, it cannot be the government policies which lead to that outcome and it will not be necessary to have those policies to deal with the fourth revolution technologies. Equal ly, I wi l l argue that cheaper telecoms and cheaper transport have had much more effect than any changes in the law as it is a futile attempt to manage an expression of human creativity, competition, messing process and correctable by products of experimentation.
And things getting better and cheaper over time are the very thing that has lifted all of the rest of us from that destitution of peasant poverty to being, as we are today, the richest group of human beings that has ever existed. Of course, this leaves entirely open whether those policies are good idea or not, but this particular justification of them is nonsense.
Just as F.A. Hayek pointed out, there is no one way for government to engineer a society or economy, and definitely, there is no one way for people to apply technology to a specific task or set of problems. Unfortunately, I see plenty of examples around where rules and regulations of society deter, delay or even ban technologies.
My favourite example is ride hailing service. We already saw the reactions of some people and government officials to the rise of Uber and Grab.
What is being missed here by the system of regulation is that a free market economy works by allowing people to experiment. I don’t understand why some people advocate institutions that we should never do anything until we know that there will be no bad effects? We need to leave the space open wide for experimentation to happen.
Why? Because we really don’t know what it is that consumers want until someone started to do it and we found out that they did.
We don’t in fact have to be inventing everything and thus don’t need to be outspending on R&D. For our basic point about technological development is that “we don’t know” – we don’t know what can be done with new technology, we don’t know what people will want to have done with new technology and thus, given that we are entirely uncertain, the government cannot plan or cannot regulate. I have absolutely no idea at all what people are going to invest and what to suggest the government should invest in. All I know is that we just need to have people around who willing to take entrepreneurial risk and can see how to apply the new stuff.
I’m pretty sure that the above is going to happen. We cannot allow the bureaucracy to insist for endless paperwork, licenses or permits while others have gone from the “Is this a good idea?” stage through testing and into full production! And do note that if a bureaucracy could do that then the Soviet system would have worked over the 70-year lifespan of their economy. Medecci Lineil