Communications technology has transformed lives. But the impact of air travel is not far behind

The life-changing technology that we all too easily overlook

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It looks and sounds like boys’ stuff – the Farnborough International Air Show – and the military side is. But actually the aircraft industry as a whole has had, and will continue to have, a profound social and economic impact on all our lives. Technology moves at two speeds. Sometimes there are a step jumps – and the current great example of that has been communications technology – but most of the time progress is incremental: tiny advances year by year that over time change everything. The aircraft industry is a prime example of the latter.

The laws of physics don’t change. It still takes seven hours to get across the Atlantic, just as it has since the early 1960s when the big jets first came in. What has changed is the cost and reliability of air travel, and the socio-economic consequences of that. Every year aircraft achieve about a 1 per cent improvement in fuel efficiency. The next generation of aircraft engines promises a further 15 per cent, while cuts in airframe weight enable more passengers and cargo to be carried for the same cost. A new generation of seats enables more people to be packed into the same space for short-haul, while the flat-bed revolution has transformed life for the business-class passengers.

We all know this because air travel is so commonplace. But we tend to forget that this is thanks to the huge competence of the two main aircraft manufacturers, Boeing and Airbus, the three engine manufacturers, General Electric, Rolls-Royce and Pratt & Whitney, and the raft of other companies making everything from the avionics to the loos. It is a classic example of how fierce commercial competition has improved the quality of the product. The airlines have fought each other in terms of service and fares, but they fly the same planes. Modern aircraft are very, very good. The frustrations of air travel, by contrast, are mostly on the ground.

Some of the socio-economic consequences are obvious. They range from fresh fruit and veg from around the world being in the supermarkets the year round, to British youth being sick on the pavements of Magaluf.

Others are less so. Cheap air freight has enabled East Asia to develop its dominance in production of electronic goods. Why are iPhones made in China? Low labour costs, of course, but also that you can deliver them anywhere in the world in three days. The holds of wide-body jets are so huge that there is not much demand now to build freighter aircraft. When we fly long-haul we don’t think about the stuff under our seats that is helping hold down the cost of the trip.

If air freight, alongside containers, is one of the sinews of globalisation, cheap air travel has become a great driver of European economic integration. Ryanair and easyJet are more important than the bureaucrats of Brussels. That has been particularly the case since the incorporation of Central and Eastern European countries, because they have made it feasible for workers from the less prosperous East to work in the more developed West. We have an extreme example of this in Britain. We use cheap flights to go on holiday; they use cheap flights to come and work here. There was a touching letter in The Irish Times last November, where a young mother whose husband had lost his job and gone to work in England expressed her gratitude to Britain for giving him work and to Ryanair for getting him home cheaply at weekends so he could see the children.

Ryanair could not have achieved what it has were it not for the Boeing 737, the most successful civil aircraft in history. At any one moment of time there are apparently 1,250 of them in the air somewhere in the world. There is a wider point here. It is that technology changes our lives more than government. That is not to diss the reshuffled ministers stepping brightly into their new posts, or is it to downplay the importance of good governance.

Sensible policies enable societies to create wealth just as silly ones crush initiative. But if you think of our day-to-day lives, the things that make life different from what it was a generation ago, you would start, of course, with the electronic communications revolution. Right behind that, however, I would rank the widespread availability of cheap air travel – the physical communications revolution – and I feel we should salute the companies that have brought it to us.

 

In need of  a Bric-fix solution

The Brics summit has just opened in Fortaleza, in Brazil, celebrating the economic importance of the four largest emerging economies – Brazil, Russia, India and China – with South Africa, the largest African economy, joining them. Or at least it was the largest African economy until a few weeks ago, but it now looks as though Nigeria has passed it in size and will increasingly pull ahead.

There you have the paradox of the Brics. The brand is much stronger than the reality. It was the genius of Jim O’Neill, then the chief economist for Goldman Sachs, to take a piece of research about a growth model for the emerging economies and turn it into an idea so powerful that this group of disparate nations should co-brand themselves into a sort of rival for the G7.

The trouble is, whereas the G7 nations are broadly similar economies in terms of structure and GDP per head, the four original Bric nations are very different. The largest of the G7 – the US – is about 10 times the size of the smallest – Canada – but while it depends a bit on what exchange rate you take, the Canadian GDP per head is within about 10 per cent of that of the US. GDP per head in Russia, boosted by oil and gas earnings, is 10 times that of India.

So their interests are different. Russia seems to have got a neutral response to its intervention in Ukraine, but that is cost-free. In economic issues the Brics want different things. Russia wants high energy prices, while India and China want lower ones. Brazil wants a more open access to US markets, as do China and India, whereas Russia doesn’t care. China and Russia want to cut the importance of the dollar, but Brazil and India are ambivalent. And so on. Can they co-operate effectively? Well, let’s see if they get an effective development bank up and running.

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