The current news cycle links continuing coverage of the disastrous oil spill in the Gulf of Mexico, whose cause remains uncertain and whose solution so far elusive, with puzzlement about the cause of a recent 1,000-point plunge in the Dow Jones Industrial Average.
It may appear that these two traumas have nothing in common. Indeed, the havoc in the stock market will prove ephemeral, while the devastation of the Gulf oil spill could be with us for a generation or more. But they are linked by the role technology played in each of them.
As the New York Times noted, the oil drilling platform that exploded and sank in the gulf “was described before the accident as one of the most technologically advanced drilling platforms in the world.” Drilling for oil miles below the earth’s crust and a mile below the sea was once inconceivable. But now it’s a proud triumph of technological advancement. In the case of the stock market plunge, suspicions center on the role of computer-driven flash trading, the esoteric and technologically sophisticated mechanism for making profits by deploying more computing power than one’s competitors in the market.
The common thread joining these two stories is the ability of technology to elude the understanding of its creators, and its power to wreak havoc beyond our control.
It was over two years ago that the $7.2 billion dollar loss inflicted on Societe Generale by a rogue trader evoked for me the Exxon Valdez and the principal that technological sophistication brings power that tends to outpace our ability to understand it and leaves us unprepared for the consequences of its misuse.
It would be a good thing if our technophilic society learned humility from these episodes.