Believe the hype: how signals from the EU can will progress into reality
The End of Stagnation
In Boom: Bubbles and the End of Stagnation, Byrne Hobart and Tobias Huber argue that innovation and progress are ‘driven more by excess, exuberance and irrationality than cost-benefit analysis, rational calculations and careful and deliberate planning.’ Progress is not deterministic or automatic. It can be set back by bureaucracy, mismanagement and risk-aversion, and other things.
They remind us that progress is, fundamentally, movement: from where we are today, to a vision of a future that could be. They argue ‘the likelihood that a futuristic vision will be realised is partly a function of how many people believe in it and how strongly.’
Taking examples like the Manhattan Project, the Apollo Program, semiconductors and Bitcoin, they posit that bubbles are key to delivering this movement, because bubbles create the hype needed to increase the number, and conviction, of those who will realise this future.
What is a bubble, why are they good?
Many are sceptical of bubbles. But the book makes a compelling case that ‘inflection bubbles’ can move society forward by ‘creating opportunities to deploy capital necessary to speed up large-scale experimentation…accelerating the rate of potentially disruptive technologies and breakthroughs.’ They identify five criteria common to inflection bubbles:
Optimism and a constrained, motivating vision, with an actionable plan. Like JFK promising in 1961 to put an American on the moon by the end of the decade and ultimately succeeding thanks to tenacity, ambitious deadlines, and excellent bottom-up project planning and management. (Even though the technology to do so didn’t exist, and he faced public and expert scepticism.)
FOMO (Fear of Missing Out) and YOLO (You Only Live Once): These bring together the communities needed to make the bubble deliver, by fostering a sense of ‘now or never’. Here, a compelling narrative and memes spread a sort of ‘psychological contagion’ among would-be participants, pushing them to dedicate time and resources to expand the bubble.
Excessive risk taking and over investment: More investors wanting more of the action reduces the amount of individual risk associated with joining a bubble. So ‘when cost is no object…innovators experiment with new technologies that aren’t cost effective, but may lead to [benefits] down the line’. With reduced risk comes more experimentation, which in turn improves the chance of success, thereby attracting even more resources.
Coordination and parallelization: It is difficult to impose top-down order on complex systems; to predict, plan, coordinate and accelerate progress. Bubbles offer a bottom-up forum for information sharing and coordination. This helps manage complexity. Bubbles also encourage parallelization: simultaneously approaching a shared end-goal from different angles (e.g. the different, but concurrent, advances in fission and fusion bringing us closer to our energy goals). Bubbles help sidestep complexity and hedge against setbacks that may otherwise hamper progress.
Reflexivity and hyperstition: Essentially, bubbles create a self-fulfilling prophecy. Progress inside the bubble improves its perception externally, which in turn spurs progress, further reinforcing the bubble’s perception. Hyperstition takes this one step further: it posits that ideas, simply by existing, can bring about their own reality.
But the most interesting conclusion is that the ‘supposedly secular and hyper-rational technologies [examined in the book] are deeply intertwined with notions of transcendence and spirituality’. By helping to bring technologies into being, bubbles are really a path to will, or to ‘transcend’, a specific idea and future into reality.
The EU could be surprisingly well-placed to trigger bubbles.
It straddles the hyper-rational/secular on one hand (as anyone who has dealt with the Commission can confirm), and the transcendental and the spiritual on the other (embodied in its motto: the unquestionable faith in ‘Ever Closer Union’.)
And, despite the trend towards pessimism in Brussels, nascent shoots of techno-optimism remain. Take space policy. The recent European Parliament hearing to confirm the new European Commissioner for Defence and Space appeared to be dominated by concern about Ukraine and Europe’s military impotence. But a semantic network analysis of the hearing shows that the discussion on space contains an embryonic narrative and discourse around ambition, optimism and progress, with terms like ‘revolution’, ‘ambition’, ‘leadership’, ‘achievement’, ‘dynamic’, and ‘innovative’ cropping up. [1], [2].
This begs the hypothetical…
What would it take – according to Boom’s hypotheses – to precipitate an EU Space Bubble?
An overly-ambitious objective with an arbitrary deadline: ‘Tabling a proposal for an EU Space Law in the first half of 2025’ is useful, but it is not overly-ambitious. ‘Creating an EU base on Mars by 2040’ is. Could this be delusional? Yes. But collective delusion and a sense of urgency are pre-requisites for creating a bubble
A narrative: ‘Safe, resilient, sustainable space’ is important, but as a narrative it wouldn’t suffice to launch a bubble. Hobart and Huber are correct that if people are truly to go all-in on something, it needs to be something verging on the sublime. This is probably why, although the decision to launch the Apollo Program was driven by security concerns, what everyone remembers from JFK’s speech is ‘We choose to go to the moon…not because they are easy, but because [it is] hard’ and why he closed with ‘as we set sail, we ask God's blessing on the most hazardous and dangerous and greatest adventure on which man has ever embarked.’
Early adopters: Europe has a thriving Space Tech scene. It could do with more venture capital, but that’s a systemic regulatory problem that must – and can – be fixed across sectors, if policymakers are willing to take on veto players and vested interest.
People to join the bubble as it inflates: The average age of the workers in the Manhattan Project was 25. Younger people tend to be less bound by convention, less invested in the status-quo, and more willing to take risks. Europe has excellent universities which would provide strong pipelines for researchers and engineers. (And if the narrative is compelling, children today should hit 25 just as the hypothetical mission reaches its apex). A flexible high-skilled visa system may also help. (It is good to see that space workforce considerations are beginning to be discussed by Member States.)
Funding: The EU has the financial clout to underwrite risk in the early days, until others join the bubble and the sector reaps the benefit of over-investment. The EU just has to decide if space is a priority worth heavily investing in.
Risk appetite and parallelisation: Progress is built on failures. Parallelization implies not every penny will lead to an immediate RoI.[3] Europe must become more risk tolerant. It can’t ask investors to back high-risk megaprojects if it is not willing to put its own skin in the game. Risk aversion and sequential investing also ignore two points of EU added value: its scale (the ability to easily absorb and shrug off downsides) and its single market (to help coordinate different regional hubs of expertise that can pursue solutions in their own way, allowing more shots on goal).
A forum for experimenting and coordination: Europe exists as a geographical, but also a regulatory, entity. Knowing how to regulate judiciously, while creating a space for innovators to experiment and coordinate, is crucial to the success of a bubble.
Conclusion: Europe’s job is to send the right signals
Ultimately, in this hypothetical it would be scientists and engineers, not politicians, who land humankind on Mars. But a common theme in all the above is the EU’s role in sending signals that create a hype, so scientists and engineers feel they will be backed all the way as they attempt turn vision into reality.
People still talk with fervour about how Mario Draghi’s commitment to do ‘whatever it takes’ sent a signal that created a micro-bubble of confidence and moved markets. Business and investors would need to feel similarly confident about Europe’s commitment to backstopping risks associated with space.
A delusionally-ambitious objective, timeline and plan; a quasi-spiritual narrative; early and ample funding; a geographic and judiciously regulated space for risk-taking, parallelization and coordination. These are all signals that Europe can send to create the hype that sparks a bubble. Get this approach right, apply it across promising sectors, and – even if Europe falls short – it will start seeing its rate of progress accelerate.
Notes
[1] A study from the European Space Policy Institute compared how space policy was pitched by EU political parties ahead of the 2019 and 2024 European Parliament elections. It found that – across different sub-fields – the number of mentions of space increased in 2024, except in ‘exploration and science’, where the number dropped. The study concluded that ‘the fact that most priorities are crisis-driven (decline in competitiveness, climate, war) [means] a more positive, exploration-related narrative is perhaps less politically palatable in view of party strategists.’
[2] I used a no code tool in the interest of expedience. It’s not perfect (it didn’t pick up the several positive mentions of ‘New Space’) but should be seen as indicative.
[3] Presumably, getting to Mars would require progress in nuclear energy and propulsion; chemistry, mineralogy and mining; agriculture, fluorocarbons and climate science; and AI, 3D printing and robotics - among others. All of these (and other, yet-unforeseen, innovations) could also foster breakthroughs applicable on earth. Indeed, in 1963 the Apollo Program bought 60% of all US integrated circuits. True to the recurring theme of positive feedback loops and virtuous cycles in bubbles, this caused the price of chips to plummet, gave an incentive for companies to invest in and deliver better chips, and opened new markets for circuits – including laptops and mobile phones.