We had a guy in the office the other day learning more about OCW for a potential project at a well-regarded US institution. He happened to have a background in banking and had some interesting perspectives on the current financial crisis. He had in fact prepared a briefing on it, first for some friends and later his town asked him to give the presentation, and he’d most recently been asked by a few companies to give the speech. After our meeting, he was kind enough to share the slides and a few highlights from the talk, and it helped to crystailize a growing concern of mine–that we’ve entered an age where our problems are exponential.
It’s a little hard to take in the scale of the economic meltdown we are experiencing, but a few data points stand out: As recently as 1990, total global GDP and the value of derivative markets were roughly equal at about 12 trillion dollars each; by 2007, the value of global GDP had increased to around 55 trillion dollars, while in the same span, derivatives had exploded to over 500 trillion, a wild escalation of poorly regulated activity that came crashing down. In Iceland, just one bank that collapsed was holding assets valued at 623% of Iceland’s total GDP.
While I can’t claim to have a solid grasp on many of the details of the financial mess, what is clear from these figures is that an important component of the problem was the exponential growth that fed it. What scares me is the prospect of runaway exponential growth of other problems, most obviously the environment. We’re used to having linear effects on the environment, but climate change isn’t happening in linear fashion. I think one of Tom Friedman’s goals in Hot, Flat and Crowded was to scare the crap out of people with respect to the environment, and with me anyway, he succeeded. Do we really want to have and ecological crash on the scale of our current economic one? It may be more than possible at this point–it make be somewhere between likely and inevitiable, and sooner than we think if it is exponential.
We need to be thinking of exponential solutions to exponential problems, and that’s one reason I think OpenCourseWare is important. We’re going to need all the good ideas we can develop as fast as we can develop them in a wide range of disciplines if we are going to address climate change. It can be done, but it’ll be the single biggest coordinated effort that humanity has ever undertaken, and we need to help everyone understand why, and access everyone’s best ideas to figure out how. OCW puts resources out there in a scalable fashion to do both.