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Stephen Dunphy / Times staff columnist
The Newsletter: Older point of view

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Globalization is the big buzz word these days, but if you go back in history, there was a similar period of global expansion in the late 19th century. Kevin O'Rourke of University College, Dublin, and Jeffrey Williamson of Harvard University have an interesting book about the similarities between that period and today.

Like now, the gap between rich and poor countries had narrowed. Trade was booming, driven upward by falling transport costs and by a flood of overseas investment. There was also migration on a vast scale from the Old World to the New.

In some respects the world economy was more integrated then. Migration on a scale with the 1890s would be unthinkable today with passports, green cards, immigration battles and fears of letting terrorists cross borders.

History is interesting enough, but advancing years also produce more mundane observations. For example, one of the most important modes of mass transportation in my view is not the car but the elevator — no high rises without it. And the biggest new technology of the 20th Century was the development of air conditioning — no big Sun Belt development without it.

What the future may bring

So in that spirit, here are two observations about the future, looking at the world from my perch of more than 60 years:

• I can no longer read small letters. It's frustrating to go to Safeco Field and not be able to read the scoreboard in left field. To read a document, I have to hold it farther from my face — more and more. Menus are also difficult, so I just say I'm on the Atkins diet and order a chicken Caesar salad.

I bring this up because at electronics and computer shows, I see smaller and smaller devices. A whole computer the size of a credit card. Cellphones with screens and tiny buttons. A wristwatch with stock information and sports scores. And these companies think these are top products.

Maybe, for anyone under 40. I suppose it's a big enough market. But with millions of boomers turning 50 and soon 60 themselves I think there is a market for large-type computers, cellphones and other devices. It's great Microsoft and Dell can cram all that stuff into smaller and smaller units. Just make the type big so we can see it, let alone use it.

Shrinking populations
 
• Someone once said that demographics are the future.

If you look at demographics then, the future holds some surprises for us. The trend is likely not so apparent in the U.S., where immigration continues to restock the population. But in other areas of the world the demographic changes will be substantial.

What intrigues me is a slowing world population, and then a shrinking one. In some places, like Japan, the population will begin to shrink.

Capitalism, or more broadly the market economy embraced now by much of the world, depends on constantly expanding markets and innovation. Innovation is important for growth — the personal computer in the past 25 years is a good example.

But what if you are Wal-Mart or Costco and your business plan depends on expanding markets each year? What happens when your markets are shrinking? Go ahead, write me a business plan for an industry in which your market shrinks year after year.

The past decade in Japan — called the lost decade because the economy went nowhere for more than 10 years — is a case in point. Consumer demand simply disappeared except for necessities and replacement buying. With no demand, prices fell, creating deflation. The economy survived, but Japan is a very different place now.

Stephen H. Dunphy's phone: 206-464-2365. Fax: 206-382-8879. E-mail: sdunphy@seattletimes.com. More columns at www.seattletimes.com/columnists

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