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BOOK REVIEW: Tracking creativity in business

- The Washington Times - Wednesday, December 1, 2010

WHERE GOOD IDEAS COME FROM: THE NATURAL HISTORY OF INNOVATION
By Steven Johnson
Riverhead Hardback, $26.95, 336 pages

In recent decades, the U.S. publishing industry has unleashed a tidal wave of books about creativity in science and business, and almost all of them have been like fake Viagra: The more the subject is discussed, explored and celebrated, the less impressive are the results in the real world.

Old-fashioned, manufacturing-oriented industrial economies such as China, South Korea, Germany and Sweden have been the ones posting the best results around the world. Every three months, the United States racks up an even bigger balance-of-payments deficit, especially with China, than ever before. Not much evidence of good ideas in business and industry there. The domestic American intellectual climate about innovation in business and industry is like the U.S. real estate market before the bubble burst: ignorant, complacent, ludicrously ill-informed and overly optimistic.

Steven Johnson's contribution to this debate is easily one of the most substantive and best we have seen for a long time. It is a riveting good read. However, it is not remotely as original as many breathless reviewers have intimated - and it stops far short of tackling the fundamental question of why the U.S. economy, industry and almost all advanced technology except for the likes of Facebook and Google are in such a woeful mess and were so even before the current president took office. Indeed, some of Mr. Johnson's recommendations would make the current problems even worse rather than better.

Mr. Johnson, predictably, follows the conventional wisdom of the past half-century or so in recommending open networks and an open intellectual climate of inquiry as essential for the development of new ideas, technologies and crucial breakthroughs and insights. This certainly is the case, but it is not remotely as original as many people imagine.

"Breakthroughs" (1993) by P. Ranganath Nayak and the "Connections" TV series (1978) by James Burke pioneered the documentation of most of the processes of complex interaction that Mr. Johnson rightly identifies. The enormous book "Cities in Civilization" (1998) by Peter Hall studied in depth more than a score of cities that for decades and even centuries led the world in focused areas of technological innovation such as medicine, shipbuilding and electrical engineering.

In effect, the crucial components of Mr. Johnson's book had been identified and documented in extensive detail decades before he even started work on his book.

In his fashionable obsession with open networks, Mr. Johnson nowhere tackles the crucial issue of intellectual property whereby the inventor is protected and rewarded through the patent system for coming up with his ideas. The United States had the greatest patent system in the world for 200 years, designed by Thomas Jefferson, until that "second Jefferson," Vice President Al Gore, dismantled it in the course of his witless "redefining government" initiative to make it "more transparent" to the public. In the decade since Mr. Gore's "visionary" changes were implemented, every idea lodged with the U.S. patent office can be stolen by Chinese or other international competitors because the system is so transparent that all the details of every American-filed innovation is open for all to see, copy and steal.

It doesn't matter how much open networking will go on. Nothing will result from it - at least within the United States - while that state of affairs lasts. The new 112th Congress should look into that state of affairs without delay.

Also, Mr. Johnson is oblivious to the wider patterns of economic and state history. Innovation erupts in strong centralized or federalized state systems that combine as free an internal market as possible with low taxation and respect and protection for private property. But those internal markets also are protected from foreign competition invading and undercutting their domestic manufacturers in their home markets.

These conditions underlay the rise of France in the 17th century, England in the 18th century and the United States in the 19th and first half of the 20th centuries. They also accounted for the industrial rise of Germany in the 19th century and of Japan, South Korea and China in the second half of the 20th century. Yet you won't find that taught at the University of Chicago or mentioned in Mr. Johnson's book.

This book is thoughtful, highly enjoyable, insightful and constructive - within its limits, but those limits are much narrower than either Mr. Johnson or his many admirers realize.

Martin Sieff is chief global analyst for the Globalist (theglobalist.com) and a columnist for Fox News.

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