At a time when we are experiencing significant inflation, Jeff Booth argues in his book, The Price of Tomorrow, that we should be seeing deflation. His argument is simple: Technology is deflationary. That is the nature of technology.
Think of how much a flat-screen TV cost when it first hit the market. What does it cost today? One example he uses is his first cell phone (which was a Motorola 8000). “It had thirty minutes of talk time before it needed to be charged for ten to twelve hours, and it cost about $2,000.”
“Our economic systems were not built for a world driven by technology where prices keep falling. They were built for a pre-technology era where labor and capital were inextricably linked, an era that counted on growth and inflation, an era where we made money from scarcity and inefficiency.” We should be experiencing deflation, which is a world where you get more for your money. But we have inflation due to money printing and the declining value of the dollar.
He also documents the ever-changing world due to technology. Blockbuster, at the height of its popularity, had more than 84,000 employees and more than 9,000 stores. But the leadership didn’t see the rate of technological advancement that provided instantaneous digital delivery. No longer did consumers have to walk in the door to rent a video.
He wrote the book to start a conversation. His numerous examples remind us that technology is moving quickly and changing our world. We may be enjoying the benefits of the digital technological revolution, but we certainly aren’t seeing deflation. Sadly, we live in a present world of rising costs and inflation.