The Goal

Today’s transformative technologies, in action and on the bench, are driving fundamental changes in legacy power, wealth, and normative behaviors. Any positive restructure of governance needs to start with this reality. However, these technologies need to be properly categorized to ensure coherent alignment between government operations and tax codes. With this unifying approach, we can unleash immense economic leverage. Positive cultural benefits will accrue as much of our political angst turns to supporting meaningful outcomes rather than championing adversarial advocacy.

The Need

A few years ago, I attended a business strategy meeting focused on the future. The speaker was a Futurist who studied eight different industries in depth. With all his insight, he said he could not reasonably predict what the future may hold beyond the next 20 years—not even a lifetime. He stated that we are living through an epoch change—akin to the invention of Gutenberg’s movable-type printing press in 1440. Even if you are a very modest student of history, you know the political, religious, and cultural changes that followed from that event. Much is being discussed about several disruptive technologies in play today. Yet, with these changes underway and more to come, our government and financial tools still operate on structures largely based on the 19th and early 20th centuries. It is past time for a thoughtful reformation in those critical areas. I intend to investigate and recommend the restructuring and reforms needed in these arenas. I want us to find solutions to build a Bridge to a Better USA. (See my Introduction Post in this blog.)

Let’s examine three things first:

1. What new drivers are forcing changes?
2. What do they need to successfully reach “street level,” where everyday folks can realize their benefits?
3. What will a reformed government and financial system look like?

In this article, I will start with governmental reform. I will discuss the needed financial reforms in a subsequent article.

New Drivers and Resources: Technological Innovation and Its Needs

Reaching back to June of 1984, a book titled World After Oil by Bruce Nussbaum, Contributing Editor to BusinessWeek, was published. It identified the “Old Locomotive Technologies,” spanning 1860–1970: 1) Electrical Machines, 2) Chemicals, 3) Steel. It correctly viewed these and new technologies as structural forces impacting power and wealth distribution.

What are the locomotive technologies today? Much has been written and discussed about these new technologies, yet they lack translation into actionable categories. Let’s start with what the World Economic Forum published on its website in January 2016: The Fourth Industrial Revolution: What It Means and How to Respond
— first published in Foreign Affairs. In this article, they framed new technology into a “Fourth Industrial Revolution”:

1. 1784: Steam, water, and mechanical production equipment
2. 1870: Division of labor, electricity, and mass production
3. 1969: Electronics, IT, and automated production
4. Future:  ? Cyber-physical systems

This view seems too reductive for today’s technologies, and using the term “Industrial” seems inaccurate. What is critically missing from this and other similar views is a better way to categorize these new technologies. We can do this by organizing them by leverage. Combined with other factors, this becomes a fulcrum for restructuring our government. In my view, there are multiple new locomotive technologies in play:

1. Robotics
2. Bioengineering
3. Digital Artificial Intelligence models
4. Nanotechnology engineering
5. 3D Printing, or Additive Manufacturing (AM)

The individual transformative benefit of these technologies is potentially incalculable. Here is an example of how disruptive AM can be. GE Aviation revealed that it used additive manufacturing designs to potentially create a helicopter engine with only 16 parts instead of 900 as currently produced. Imagine the impact of such a change. But our government’s old structure confronts the additive impact of all five technologies listed above—simply overwhelming.

Before showing an example of a country that has reformed governance, it will help to align these technologies into a useful triadic view—providing the clarity needed for later recommendations.

A “Leverage” View of Transformative Technologies

Here are three categories based on the nature of their leverage.

The Three Technologies of Our Era:

1. Locomotive Technology
2. Transformative Technology
3. Informative Technology

The following table details their nature, function, and effect. Within these categories, we find primary forces and secondary orders.

Now that we have a useful categorization of today’s transformative technologies, I want to reinforce the point that the growth and continued development of such innovations require governmental policies, tax policies, and operational policies that maintain a level playing field for small and large enterprises. Innovation comes from the “factory floor” and from smaller players. Disruptive innovation comes from the edge—usually small firms—and they need capital and government protection and support. We know this from Dr. Clayton Christensen’s pioneering work on innovation, in three seminal books:

• The Innovator’s Dilemma: When New Technologies Cause Great Firms to Fall
• The Innovator’s Solution
• The Innovator’s Prescription

1. Locomotive Technologies

   Providing power and movement

   Primary Forces

   • Electricity — by various means
   • Steel — metals
   • Fossil fuels — petrochemicals and natural gas
   • Hydro — water
   • Forestry
   • Mining
   • Nuclear

   Secondary Orders

   • Steam
   • Propellers
   • Screw mechanics
   • Batteries
   • Solar

2. Transformative Technologies

   Providing new elements and tools

   Primary Forces

   • Chemicals and chemistry
   • Biology — genetics and genetic engineering, including GMO foods
   • Physics and engineering

   Secondary Orders

   • Nanotechnology
   • Additive Manufacturing
   • Robotics

3. Informative Technologies

   Primary Forces

   • Written media
   • Visual media
   • Computations
   • Printing
   • Computers & Programs
   • Advanced microprocessing

   Secondary Orders

   • Digital big data
   • AI
   • Algorithms
   • Quantum computing

Disruptive innovation often originates in small companies and then moves into larger firms. Where do companies such as Google/Alphabet, Microsoft, and Meta get their new solutions—just internal staff?  For example, reports show that Alphabet acquired over 200 technology companies, Microsoft 277, and Meta 91. These numbers do not include acqui-hires, minority deals, or purchases by subsidiaries.

In a future article, I will return to the Technology Leverage Chart and show how to use it to structure reformed governmental operations and tax strategies. At this point, let’s use a simple example of a needed reform and present a nation that has already enacted a major reorganization.

One Key Operational Need for Our 21st-Century Federal Government

Now let’s put the innovation question to our government. Are our government structures organized to meet the challenges posed by these transformative technologies? Secondarily, does a great deal of current political confusion, angst, and the retread of old ideologies spring from these legacy structures? How can we successfully build a Bridge to a Better USA without evaluating their adequacy and making changes?

Over the past decades, commercial enterprises have broken down the silos between functions. Multidisciplinary teams have effectively led products and services through development and execution. Yet our government, its agencies, and tax codes are terribly siloed. As businesses have done for the past 25 years, our government must break down its silos and reorganize.

Japan’s Government Reorganization

What does a reformed government look like? Japan, the fourth-largest economy in the world by nominal GDP, reorganized its government in 2001. The key focus was on the executive branch consolidating ministries and agencies and eliminating old ones. It was undertaken to improve transparency, eliminate costs and redundancies, and increase the effectiveness of administrative operations. However, a key aspect they included was positioning government with respect to future technological development and impacts.

For example, the Ministry of Economy, Trade, and Industry (METI) had its focus broadened to include policy bureaus for trade, economic security, innovation and the environment, commerce, and information. It also included the Agency for Natural Resources and Energy, the Patent Office, and the Small and Medium Enterprise Agency. Notice the inter-relatedness of these functions and how innovation and competitiveness are addressed. There are many other aspects of this bold move worthy of later comment. Importantly, the push for governmental support for new technologies continued. In 2012, it led to the creation of a ten-year program—the National Nanotechnology Platform—in which the government helps fund and participates with over 38 institutes and universities throughout the country. The program was renewed in 2022.

In contrast, the United States federal government has many separate departments, duplicating overhead and issuing conflicting regulations that often require administrative judges and courts to get involved. These agencies will actually file briefs on behalf of a plaintiff opposing another department or agency. Yes, taxpayers pay for the government to fight itself. At one count, there are over 430 departments, agencies, and sub-agencies in the federal government, all issuing more regulations in their silos. In fact, the Federal Register, which issues proposed and final administrative regulations for federal agencies, added 857,522 pages from 2015 to 2025.

I am not saying these pages were all unworthy, but I question how much would have been needed if departments and our tax code were coherent in policy and operation. I am also not suggesting that Japan’s governmental model is best or perfect. But it appears better positioned to support the epochal changes brought by this era’s new technologies.

Conclusion

We all want to live in a safer, wealthier world. To that end, consider this quote—still very valid for our amazing times:

“When it is obvious that the goals cannot be reached, don’t adjust the goals, adjust the action steps.”

— Confucius

I know I have not answered all the questions that may have been raised. Still, I have presented reasons why we need to reform the structure and administration of our government.  This action must leverage the new technologies. This needs to be done through structural and policy changes that span the tax code and other financing channels. What is gained is not only more policy coherence and cost containment, but a longitudinal foundation for at least the next decade.

In the next article, I will present reform suggestions and show how the triadic Table of Technology Leverage shown above brings intra-referential and longitudinal benefits to hand. If we don’t make this move, we will see the 21st century’s amazing technology opportunities strangled and lost forever.