Jeremy Rifkin's Third Industrial Revolution

Forbes has an interview with Jeremy Rifkin about his vision of the future - Jeremy Rifkin's Third Industrial Revolution.

How did you come up with this idea?

My read on history is that the great economic revolutions occur when two phenomena come together. When we change energy regimes, it makes possible much more complex economic relations. When energy revolutions occur, however, they require communication revolutions that are agile enough to manage them. If you look at the 19th century, print technology became very cheap when we introduced steam power into printing. That decreased the cost and increased the speed, efficiency and availability of print material. At the same time we established public schools in Europe and America. We created a print literate workforce with the communication skills to organize a First Industrial Revolution driven by coal and steam power.

Then we did it again in the 20th century with the convergence of communication and energy: Centralized electricity—especially the telephone and then later radio and television—became the communication vehicles to manage a more dispersed Second Industrial Revolution, organized around the oil-powered internal combustion engine, suburban construction and the creation of a mass consumer society.

Energy historians only deal with energy, and communication historians only deal with communications, but in history you can’t really do one without the other. That’s the framework that led me to this kind of search, and the Third Industrial Revolution really came out of that narrative on how history evolves.

So, what exactly is the Third Industrial Revolution?

First of all, it’s based on a new convergence of communication and energy. The Internet has been a very powerful communication tool in the last 20 years. What’s so interesting about it is the way it scales. I grew up in the 20th century on centralized electricity communication that scales vertically. The Internet, by contrast, is a distributed and collaborative communication medium and scales laterally.

We are in the early stages of a convergence of Internet communication technology with a new form of energy that is by nature distributed and has to be managed collaboratively and scales laterally. We’re making a great transition to distributed renewable energy sources. And we distinguish those from the elite energies—coal, oil, gas, tar sands—that are only found in a few places and require significant military and geopolitical investments and massive finance capital, and that have to scale top down because they are so expensive. Those energies are clearly sunsetting as we enter the long endgame of the Second Industrial Revolution.

Distributed energies, by contrast, are found in some frequency or proportion in every inch of the world: the sun, the wind, the geothermal heat under the ground, biomass—garbage, agricultural and forest waste—small hydro, ocean tides and waves. ...

You speak of “we.” How are you doing this?

I chair a group of more than 100 companies—many of whom are the main players in the renewable energy industry, the construction industry, urban planning and architecture, IT, and global logistics and transport—that comprise the Third Industrial Revolution Global CEO Business Roundtable. We use a similar organizational model to the one used in the film industry. Everyone has their own expertise. We come together to help political jurisdictions, the local business community and civil society create a Third Industrial Revolution narrative and game plan—analogous to a script—that can help them transition their economies into the new economic era.

The Third Industrial Revolution Global CEO Business Roundtable is the outgrowth of the dramatic changes that have taken place in the recent past. We’ve had two events in the last three years that signal the beginning of the endgame for the Industrial Revolution based on fossil fuels. The first one was July 2008 when oil hit $147 a barrel and the costs of all the goods and services across the global supply chain went through the roof, purchasing power plummeted, and the entire global economy ground to a halt. That was the great economic earthquake that signaled the beginning of the endgame for an Industrial Revolution based on fossil fuels. The financial collapse 60 days later was the aftershock.

We’ve hit peak globalization in how far we can actually globalize the economy based on elite fossil fuels. Every time we try to re-grow the economy at the same growth rate we were experiencing before July 2008, oil prices will rise and the prices of all other goods and services will climb as well because all the economic activity of our global economy depends on fossil fuels. We grow our food in petrochemical fertilizers and pesticides. Most of our construction materials and the vast majority of our pharmaceutical products are made of fossil fuels as well as our packaging materials and clothes. Our power, heat, light and transport are also reliant on fossil fuels. The price of virtually every good and service in today’s global economy is dependent on the price of oil. That is why we are likely looking at four-year cycles of growth and collapse. Each time we try to restart the engine by replenishing inventories, oil prices will climb back up, all the other prices for goods and services will spike along with the price of oil, and at around $150 a barrel, purchasing power will plunge and the economy will shut down. That’s exactly what is happening now as we head to a second collapse of the global economy.