For reasons I can’t entirely recall now, my freshman year of high school began on Friday, September 1, 1978–the day before the Labor Day weekend, or, what is traditionally regarded as the last official weekend of summer.
I will never forget the very first lesson of my first class–Social Studies I. It began promptly at 8:05 AM and was taught by Louie Senta. He was a gruff old man with a shock of silver hair, a gravelly voice, and, if I didn’t know better, I would have thought he was delivered straight from central casting to play the role of an intimidating disciplinarian—a role, I might add, that he played with a persuasive amount of gusto.
After the bell rang signaling the start of class, Senta set his steely blue eyes upon his new wide-eyed charges for what seemed like an eternity. He then posed this peculiar question: “If you had a choice between taking $100,000 a day for this entire month, or accepting a single penny today and then having the penny double every day for the remainder of the month, which would you select?”
The class was silent, but I remember thinking to myself “what a stupid question.”
Unbowed by the sea of incredulous, pimpled-spotted faces staring back at him, Senta asked, “How many of you would choose $100,000 a day?” His face showed no emotion as he paused a moment to let us to ponder our answer.
At the time, my only concern was whether the month of September had 30 or 31 days; and, therefore, whether I would be entitled to the princely sum of $3 million or $3.1 million.
Senta called for a showing of hands. Without bothering to look around the room to seek the assurance of my peers, I shot my hand up. Only afterwards did I glance around the room and note with mild satisfaction that my new classmates were just as bright as me.
To confirm what was already patently obvious, Senta then asked if anyone would choose the second option. No one raised their hand. Then, in a refrain that was to become all too familiar for the next four years of our lives he ordered us to “Do the math. See much how richer you are because of your wisdom.”
Being good with numbers, I quickly doubled the penny ten times and calculated the sum to be $5.12. I continued on for another ten doublings. The figure, after the twentieth iteration, I noted with a serene sense of satisfaction was a scanty $5,242.88. Again, I pressed on in confidence. It was only after the twenty-eighth step—when the figure reached $1,342,177.28—that a sinking feeling came over me and I realized the errors of my ways. After the thirtieth and final doubling, I calculated I would have been entitled to $5,368,709.12–or almost $2.4 million more than if I had taken the “obvious” choice.
In retrospect, I suspect that the purpose of Mr. Senta’s little exercise was two-fold. For starters, the quiz was doubtlessly his way of humbling a bunch of cocky, fourteen-year-old know-it-alls; and demonstrating to us, in no uncertain terms, that we still had much to learn.
In a larger sense, though, I believe he was trying to teach us a more profound philosophical lesson and that was that things which might at first appear to be “obvious” are not always so. And while he didn’t say it at the time, the implicit message was that it was important to understand the underlying forces that are at work in any given situation.
I tell this little story because, just as my classmates and I didn’t appreciate the power of exponential growth with regard to the penny; today, there are no fewer than nine technological forces that have been, and are continuing to grow at, near exponential rates; and unless people begin to come to terms with the momentous changes that are afoot, they are going to make some costly mistakes—mistakes that will make my hypothetical loss of $2.5 million look like child’s play in comparison.
The nine technological trends undergoing exponential advancement are computers/semiconductors, data storage, bandwidth, the sequencing of the human genome, brain scanning, artificial intelligence, nanotechnology, robotics and the advancement of knowledge itself.