Latest blog/rant from the developer, Mike Towle . . . . . . . .
Is it harder to start and run a small business now compared to say 30 years ago? I suspect it is. And, this is a big problem because a surprising amount of long term growth comes from the creation of small businesses, as some of those small businesses become medium or even large businesses. There are plenty of stories of businesses started up at home in a spare room, that years later end up employing hundreds, or even thousands.
I think there are three main problems:
First problem is the internet. It's great for almost instant communication, and for getting your message and brand out there. But there is SO much competing for the viewers attention, these days getting your message and brand out there is very expensive. It requires a lot of carefully placed advertising. It requires the kind of investment most small businesses, and certainly most start-ups simply don't have. The internet hasn't turned out to be quite the leveller we all thought it would be back in the early 2000's. Of course, some get lucky, and with next to no monetary investment they rise to the top of the pile. They become the influencers, their messages trend, they set the tone, and plot a path to the future. It's lead almost entirely by young people. No harm with that, good luck to them. But how does that help the women who wants to sell her new line of shoes, or that guy or who wants to build up his business importing saxophones? Without a substantial advertising budget, it doesn't.
The other problem is regulation. There is far more of it now than there was 30 years ago. Starting a business now, you could easily spend all your time sorting out what regulations apply to you, how to manage them, and what administration is required to keep all the government agencies happy. Where do you find the time to actually run your business? In practice of course, most people will ignore much of the regulation, and just keep their fingers crossed they don't go too far wrong - or if they do, they don't get caught!
The third problem is the internet! Again? Yes, well partly, because there are a lot of businesses out there on the internet, fulfilling all sorts of needs for both private and commercial customers. So where does a prospective new business find a niche? Years ago, if you were interested in catering, say, and wanted to set up a simple cafe, you'd look for a busy area that doesn't already have a cafe, or least not too many, and where the rent isn't too expensive. But now, you have to be more particular. You can't rely on business from housing estates or apartments, like you might have done once, because a lot of those residents will use one of the on-line delivery services. In the United Kingdom, you have to be very careful you don't pick premises with too high a rateable value, otherwise all your profit will go to the local council. Business rates on commercial property in the UK are just ridiculously high. A throw back from the hey day of retail back in the 1990's, when high street retailers could actually make money. Sadly, those days are gone, but sky high business rates remain, turning many high streets into commercial deserts. Also, unless you're just relying on customers walking past, then you also have to pick premises that people can actually get to. Many councils are limiting car parking to such an extent, they're crippling access to many parts of their towns. So not just the internet, but the tax system, and your own council may also all be working against you. Perhaps your business doesn't need a shop front? That reduces some of the problems. But not having a shop front means you need to market your goods/service in some other way, which leads us back to the internet.
What shocked me, is that when I checked the statistics for business start ups, I found that in the UK 82% were started up by people aged 40 and over! 57% by people aged 50 and over. So the vast majority of new business are being started by people who are middle aged or older. Is this due to young people not having access to capital, and/or not having the experience to deal with the issues I mentioned above? I honestly don't know. It surprised me. I'd assumed they'd be a lot more younger people starting businesses. But the statistics showed only 4% of businesses were started by people in the 18 to 29 age range. You can check out these figures here: Small Business TRENDS
. Further, figures show older entrepreneurs are more likely to be successful. Peaking around people aged in their mid fifties (sourced from the Harvard Business Review).
Looking at figures showing business start ups over the decades, there are less now than there used to be. In percentage terms, relative to population size the number of start ups appears to be around half what it used to be back in the 1970's. That's depressing. And a rather damning indictment of the policies of many governments towards small businesses.
So the answer to my question, sadly, seems to be 'Yes'.
For many in the United Kingdom, Making Tax Digital probably sends a chill down the spine! Due to be introduced on 1st April 2019 (the date is probably apt....), it will force 1.2m businesses to change the way they send their VAT information to HMRC. For quite a few businesses it will mean a big change in the way they handle their accounts.
HMRC (the United Kingdoms tax authority) seem to be pushing this through, despite protests. Even the House of Lords Economic Affairs Committee are highly critical in their report published on 22nd November 2018. Read the summary here.
In a nutshell, they say it's being introduced too quickly, and many businesses will not be ready by 1st April 2019. They recommend delaying the introduction of MTD for VAT returns by at least one year, and then introducing it in stages.
In their report, paragraphs 9 and 56 both read:
"The software industry is, unsurprisingly, responding to the
commercial opportunity of Making Tax Digital for VAT. We have
seen no evidence that any free software products will be offered."
They are, it seems, unaware of Adminsoft Accounts!
It's certainly true, that many businesses will have to completely change the way they handle their accounts. Perhaps because they're using older software that will not be updated to handle MTD, or in many cases they do not use a computer based accounting system at all. Perhaps they have few enough transactions to be able to manage just using a spreadsheet. Software will be available that will allow those businesses to continue using a spreadsheet, called 'bridging software', it can accept a file output by a spreadsheet and take the VAT figures from that and send them to HMRC. Some packages may be able to extract the figures from cells directly from within the spreadsheet (Adminsoft Accounts will be able to do this). The big problem with filing VAT returns under MTD, is that the final VAT figures to be filed can not be input by hand. They have to be calculated. Which is why businesses with a turnover in excess of the VAT threshold will no longer be able to use the existing HMRC portal for filing their VAT100 returns.
For a more detailed look at the introduction of MTD, and how Adminsoft Accounts can help, click here.
Will HMRC pay any attention to yet another report critical of it's tight deadline? Probably not. The House of Lords Economic Affairs Committee report notes that it's previous report of March 2017 was ignored! It seems, HMRC only listen when it suits their agenda, and turn a deaf ear (or is it a 'blind eye'?) when it does not. They could be playing a dangerous game. If come 1st April 2019 large numbers of business still are not ready for MTD, what happens? Do HMRC issue millions of pounds worth of fines, perhaps at a time when businesses may also be struggling under the weight of Brexit? Especially if it's a 'no deal' Brexit. Brexit and MTD all around the same time could be just too much for many businesses.
Although I've been working hard to ensure Adminsoft Accounts will be MTD compliant for VAT by 1st April 2019, I agree with the House of Lords Economic Affairs Committee, it should be delayed a year.
I fully expect HMRC to ignore my recommendation too!
How safe is your data? I don't mean the data you hold about other people or organizations, I mean the data that's held about you. Things like postal address, date of birth, political leanings, sexual orientation, bank details, credit card details, etc. It's all out there. Particularly if you use social media. Perhaps, your data isn't where you thought it was, isn't as safe as we're normally told it is?
So far this year, major security breaches have been reported by Facebook (details of 90m users stolen), Uber (57m customers), British Airways (380k transactions), T-Mobile (2m customers), Reddit (numbers so far unknown), Timehop (21m users), Dixons Carphone (10m customers), MyHeritage (92m users), Under Armour/MyFitnessPal (150m users), FedEx (actual numbers unknown). Source: www.techworld.com
There are a great many smaller data breaches, most of which we don't get to hear about. In fact, many small to mid-size organizations may not even be aware the data they hold has been compromised. Large organizations often monitor their systems for any unusual activity. Smaller organizations often do not have the resources to do this, or they are not sufficiently internet/security aware to realize the extent to which their systems are at risk. The reality is, any device that connects to the internet is a security risk, considerably more so if the device also connects to the organizations network.
The worst thing about it is, you can't really avoid it! Today, most people will use social media, on-line stores, on-line banking, and/or other internet related services. There is no escaping it. We're all vulnerable.
As the internet becomes more sophisticated, and more things like security systems, heating systems, camera's, and even household appliances all become exposed to the internet, that vulnerability is increasing. Self drive cars are next on the list, sometime next decade. Some planes are connected now, or at least their passengers are. Yet at the same time, we have ever increasingly onerous data protection rules and health and safety legislation. The world we're moving into is a strange place, where the greatest danger may not be in front of you, or even anywhere near you. The thing that threatens you most could be thousands of miles away, and is far more insidious.
No one likes paying tax. But often it's not just that we don't like paying it, it's actually a serious burden. Businesses have collapsed under the weight of taxation. One tax that should have been abolished years ago is the tax on business property, particularly retail. 'Business Rates' it's called in the UK. If there was ever an archaic tax, this is it.
As we all know, the high street is under threat from the internet. Many retail outlets are struggling, many have gone out of business. We've all aware of this problem, except it seems the government. They seem bent on extracting huge amounts of money from retail outlets who simply don't have it anymore. The retail boom of the 1990's is well behind us. Yet the government seems to be stuck in the past, they don't seem to appreciate it's 2018. It's a different world now. How can retail compete with on-line shopping when retailers have to pay vast amounts of tax, based on some notional value of their premises, when the operators of many on-line shopping sites are paying little or no tax on their premises? Many large international web site operators aren't even paying tax on their profits........
If the situation is allowed to continue, one day they'll be no high street, or shopping malls.
Tax should ALWAYS be based on profit. Taxes that aren't are usually unfair, and rarely work well. There are other examples, like stamp duty. This is paid on property purchases (among other things). There are three main issues with this tax: it is not based on any profit or ability to pay. Neither seller nor purchaser could be making money, yet the purchaser still gets taxed. You can not even claim it as an expense to reduce corporation tax, even though it's effectively reduced your profits (assuming a profit has been made). It has to be added to the capital value of the property. The idea is you eventually get corporation tax relief on it when you sell the property, but in practice the amount of stamp duty paid gets inflated away if the property is held for a substantial period. As if that wasn't bad enough, if the property is subject to VAT (20% in the UK), you actually pay stamp duty on the VAT!! For example, if you purchased a property for £200,000 plus £40,000 VAT. You can claim the VAT back, if you're VAT registered (if you're not, tough). But you don't pay stamp duty on the £200,000, you pay it on the whole £240,000! So you're actually paying tax on the £40,000 tax you're paying! And, you can never claim back stamp duty, once paid, that's the last you see of your hard earned cash. I don't know how HMRC (the UK tax authority) get away with forcing businesses to pay tax on tax?
Anyway, I digress. The UK government has been tinkering with business rates for a few years now. All business premises have been revalued, and the threshold below which business rates are not payable has been doubled. This means a lot more very small businesses now don't pay business rates. That's great. Except they're mainly businesses run from offices or workshops which tend to have a much lower notional value that retail promises. Most shops are still paying rates, and at a higher level because they're now subsidising all those small businesses that are no longer paying rates! So a great many businesses that can least afford to pay rates are now paying even more! How does this make sense?
All I want is a government that realises it's in the 21st century, and plans it's taxation accordingly. Is that too much to ask?
Are many large businesses setting themselves up for a fall? There is a remorseless pressure on them to improve service levels while reducing costs, and so increasing profit. But in the end, it's an equation that doesn't balance. Cutting out waste and excess is one thing, but this goes far beyond that, and we're all paying the price.
At home, we have a service contract with a large company to service our boiler once a year and provide cover in the event it and/or associated bits of the heating system fail. We've contracted with them to do this every year for the last 20 years or more. The boiler service used to take place every July. But over the last few years this has started to slip, it's got later and later. The contract is renewed in Sept, and this year we were told the service couldn't be done until mid. December! Two months after the contract in which they're committed to do the service has expired. As if that wasn't bad enough, a few days ago they cancelled the December service and said we needed to contact them to re-arrange it. After waiting on the telephone for what felt like forever, we eventually got to speak to someone who said the earliest they could do it was February!! We demanded a refund for the contract expired in Sept, and the new one started. We were told someone would 'phone us back within two hours. That was three days ago, no one has 'phoned us back. I can see this is going to take up a lot of our time to sort out.
It's probably a familiar tale, the sort of thing that everyone has experienced. The internet is full of such stories from frustrated customers.
I have personally banked with the same bank for over 40 years. One of my businesses has banked with them for over 20 years. Yet early this year we start getting strange letters telling us to telephone them to arrange a telephone interview (why not just speak to them there and then?) to discuss security. The subject is potential money laundering, and their letters are written in such a way that they clearly believe we're rather stupid. They say it's about protecting us, in fact, it's about protecting the bank. Now money laundering is a bad thing and should be prevented where ever possible, I can fully understand the bank going to great lengths to try to prevent it. But why dress it up as if they're doing us a favour? Anyway, I digress. The point is, I accommodated their demands (they said they would close my business account if I didn't). But they kept sending letters saying I hadn't provided the information. These letters contained no contact information other than the registered address of the bank and a general call centre telephone number I was supposed to use to arrange these endless telephone interviews. To cut a rather long story short, in the end I refused. The problem is, there was no one to communicate with? Many years ago I'd deal with the branch manager, but they're long gone. Then I'd deal with the account manager, but they've been gone probably a couple of years now. I'm not sure when because I think they kept it quiet. So I wrote to several addresses, and eventually some one actually wrote back to me. Finally, I think (or maybe it's more 'hope') that it's on the way to being sorted out. But it's taken a LOT of time my time.
I know that no matter how good the service is, sometimes things just go wrong. But this isn't that. This is systemically poor service dressed up to look like good service.
I usually buy the same make of car, but if something goes wrong with it and I take it back to the local dealer (part of a large chain), they usually tell me there's nothing wrong with it, or it didn't go wrong when they had it, or some similar excuse. Anything to avoid a repair. Usually I then have to put up with the fault until I eventually change the car. I have a very low opinion of my local car dealer, but from what I hear, they're all the same now. It's what we're stuck with.
I've had numerous encounters with large companies that all proved very difficult to deal with, and I'm hardly alone. In order to reduce costs, they minimise customer contact. It is getting increasingly difficult to communicate with a human being. Many companies operating on-line don't have a telephone number, some don't even have an email address. You have to fill in a form, and answer some questions which more often than not are not at all relevant to the problem you need to discuss. You end up spending (wasting) vast amounts of time trying to sort out some issue created by a company that doesn't want to speak to you.
In a way, we've brought this on ourselves. We're hooked on 'cheap', on getting the best deal possible, which usually means the cheapest. For a company to provide the cheapest goods/services, they have to cut their operational costs to the bone. When it works, it works great. When it doesn't work, it's a real pain, and it costs us a LOT of time trying to sort it out. Sometimes it just never gets sorted out. If it's an inexpensive, fairly unimportant item/service to begin with, I expect some compromise. When it's a bank account that my business is highly dependant on, or an expensive car, it's a whole other matter! Yet, large businesses across the board are all busily removing anything from their organizations that looks like customer service. Ironically, while telling customers about how they are enhancing their customer support/service! Well, perhaps more 'marketing' than 'ironic'. It's the old 'if you tell people the same thing often enough, they'll start believing it....'.
Big companies must have consumer feedback information. They must be measuring customer satisfaction. I assume therefore, they've analysed the cost of providing customer service against the customer churn rate, and picked a level at which the customer churn rate is acceptable. They may decide, for example, that the cost of providing a service level to the point where they only lost 1% of business each year due to dissatisfied customers isn't cost justifiable. So may settle on something like 2% or 3% as a cost effective level. There are two problems with this: a) many dissatisfied customers never actually tell the company, they just go elsewhere, and b) if you have someone (we'll call A) who is dissatisfied with company X, and a mate (B) who is dissatisfied with Y, and another mate (C) who is dissatisfied with Z, companies Y and Z will never get A's business (and companies X and Z will never get B's business, and so on). So that 2% to 3% churn due to poor customer service, could in effect be a great deal higher!
Will people eventually just get fed up with poor/non-existent service, and slow down their buying altogether?
Many governments are currently engaged in a worrying trend, they're borrowing from tomorrow to help shore up their finances today. The United Kingdom government is especially keen on this trend. But are they building up problems that will be impossible to resolve in the future?
I'll use the United Kingdom as an example, as living there, it's obviously the country with which I'm most familiar. But a lot of what goes on here is happening in many other countries. It's not exclusively a UK problem.
There was a time when businesses calculated the tax on the profit they made during their financial year, many months, and sometimes even years after the end of their financial year, and the actual tax amount was paid even later. Once all transactions were known and allocated, movement and depreciation of all assets and liabilities were known, the accounts had been fully completed, and the profit figure had been properly established. Then new laws were introduced to force businesses to pay their tax by a given date. This improved the governments cash flow. Then new laws were introduced for some businesses, whereby they had to pay tax in advance, based on assumed profits they haven't made yet! Based on what they made the previous year, which as any small business owner will tell us, is a very poor indicator of what they will make the following year. But the government is happy, as it further improved their cash flow. In the near future, all businesses will have to pay tax like this, 'on account'. This will be even better for the governments cash flow, in the short term. What they don't seem to realize is they are draining cash from businesses. This will impact investment. Which years from now will ultimately reduce profits and so reduce the tax receipts in later years. It could even cause some underfunded businesses to collapse due to lack of working capital.
But this is just the start. Back in the early 2000's the UK government came up with a great idea. Increase university fees so they are the highest in the world (excluding private universities), and lend the students the money to pay for them, and to make it even better, they charge an exorbitant interest rate. Most students will leave university with over $50,000 in debt, and rising. This loan then gets paid back via a deduction from their salary. It is, to all intents and purposes, another tax. This will decrease the buying power of graduates (many of which will no longer be able to purchase a house to live in as a result of student debt and rising house prices), which will in turn impact the economy. Which will further reduce the tax receipts available to later governments.
Then there is the abuse of the tax system by governments. In that they use it for social engineering and to attempt to control the economy. For example, in the UK there is a major housing shortage (thanks to the government.....), and so house prices keep going up. Many people living in other countries will be all too familiar with this. The UK government, rather than make any serious attempts to resolve the problem (ie. by promoting house building) decided to make it expensive for private landlords to purchase and rent out property. I won't go into the detail, but suffice to say the private residential market is no longer a good investment. In the short term, this is pushing up rental prices, in the long term it's preventing many individuals from making sound investments that would see them into the future, that would perhaps contribute to their pensions (perhaps reducing the burden on the state years from now). There are many examples where investments are highly taxed. The government tells people to save and invest, but then penalises them if they do so. If they keep the people poor, the pensions burden in years to come will that much greater Which of course is why they're increasing the age at which people can draw a state pension. They need to keep people working for longer. I'm just not sure the jobs will be there?
In the meantime, the real problems causing governments to be short of cash, such as ensuring all tax due is actually collected, and ensuring that tax is fair and large international businesses aren't allowed to make billions in profit and pay little or no tax, and money that is spent is spent efficiently (governments are spectacularly bad at this), and that 'white elephant' projects that cost billions with little cost justification never get off the ground, never get resolved. It would seem for most governments, these problems are too hard to solve, and so they look for other ways to increase revenue, with little thought at all about the consequences beyond their term in office. All the while, the country is increasing it's debt.
I shudder to think of the huge problems that lie ahead in say twenty years. When various governments have concocted all kinds of schemes to drain the cash from the current system, and expenditure is huge (partly due to considerable interest payments on all that state debt and an aging population), and the amount of tax being collected has dropped significantly. What happens when they run out of options? When they can't concoct any more schemes to drain cash from an economic system that is by then barely functioning due to a profound lack of liquidity?
Check out National Debt Clocks
, it's scary.
Governments talk about getting the national debt under control, so we're not leaving a problem for our children. But borrowing from the future is doing the exact opposite.
I often discuss things that have little to do with accounts or accounting issues. Today, I want to discuss poetry! Check out Skylark Publications UK
They're a non-profit foundation.
This organisation is run by Yogesh Patel. He wrote the book Free Accounting with Free Software, based on Adminsoft Accounts, but he spends a great deal of his time promoting poetry and writing in general. He was invited to Buckingham Palace to meet the Queen for the launch of the UK-India Year of Culture. Please visit the Skylark Publications UK and offer your support. As a non-profit, all profits generated go to various charities.
Like most people, I wrote a little poetry while at school. Then I never touched the stuff! Most of us read the news, some of us with a little more time available read novels. But how many of us read poetry? Hundreds of years ago, poetry was written by a lot of people, and read by a lot of people. But time seems to have diminished our appetite. Today, while it may be down, it's most certainly not out. I would say it's starting to grow in popularity once more.
I admit I only tend to read poetry when I come across it by accident. I find it's like music, sometimes it works for me, sometimes it doesn't. Sometimes it doesn't even rhyme? But I guess that's me showing my ignorance.
I'm afraid I have two eyes: a commercial one and a scientific one, and I can't see poetry out of either! Unless you put it to music. Bob Dylan did OK out of it....
On 23rd June 2016 the United Kingdom held a referendum to either leave or remain in the EU. Now, one year after the referendum in which 'leave' won the vote with 51.89%, negotiations to leave the EU have hardly started, and no one seems to agree what Brexit actually means.
The campaigning leading up to the referendum was appalling. Both sides did not clearly state the case for remaining or leaving, and made a series of highly misleading statements. In the case of the leave campaign, those doing the campaigning and making some of those crazy claims are not the people who's job it will be to make it happen! After the referendum, now the hard work of the negotiations is at hand, they're not part of it. In the end, the vote was based more on gut feeling rather than informed decision. I'm pretty sure very few of the people who voted actually knew much about how the EU really works, regardless of which way they voted (including myself). Although I also suspect they know rather more now.
Those who voted for the UK to leave the EU say the referendum has taken place, they won, and those who voted to remain should just accept it and stop moaning about it. They have even nicknamed those who voted remain as 'remoaners'. For those that voted leave, it's the end of that debate, and they seem to want to shut down any further discussion. Which doesn't strike me as being particularly democratic. Especially as the vote was so close. The problem is, what does leaving the EU mean? Does it mean leaving the Single Market? The Customs Union? The EU Court of Justice? And a host of other EU related bodies and agreements? None of this was on the ballot paper. It was basically a simple 'Do you want to leave the EU, Yes or No' type question. Unfortunately, the answer is not a simple yes or no. The UK's relationship to the EU is vastly complicated, and symbiotic.
Those who want a so called 'hard Brexit', just want to walk away from everything EU related, and trade with them under WTO rules. They don't seem to appreciate the massive impact that would have on the UK economy. The people who voted for Brexit were voting for different things. Some voted because they want the government to have better control of our borders, and so limit immigration. Some voted because they don't like all the laws coming out of Brussels to which the UK is subjected. Some voted because they don't like the idea there is a law court with a higher authority than the highest court in the UK. Some voted because they believe the UK will be better off economically, in the long run. And some voted for Brexit as a protest vote, not because they were particularly bothered about the UK leaving the EU So no one can agree on what Brexit is? Exactly what did the electorate tell the government to do?
The UK's prime minister Theresa May decided to call a General Election a couple of months ago. She said she wanted a 'strong and stable' government. I think the real reasons she called an election, is that a) the main opposition party, Labour, were very weak in the polls, and b) she knows full well the UK is not going to get a good deal out of the EU, and she didn't want to be facing an election in 2020 (when it should have taken place) with the 'bad deal' being blamed on her Conservative party. She thought her Conservative party would come back into power with a large majority. Giving her a lot of power, and another five years to wield it. She miscalculated. Her Conservative party did win the most seats, but less than it already had. So much less, it no longer had a majority, and was severely weakened. They had to do a deal with another party, the DUP, to give them enough seats to govern. Their loss, however, is probably a win for the country, because now they have to listen to the opinion of other parties (especially the DUP). Prior to the General Election, Mrs. May seemed to be veering towards a hard Brexit, and was not listening to anyone. But no more.
You can see all this has created a great deal of confusion!
Having voted to remain, I was disappointed with the result, and fearful for the future. Then I went through a period where I accepted the result, and thought we just needed to get on and get it done. The sooner the better, because there's little worse for business than uncertainty. Businesses can't put together any meaningful business plans, or make any significant investments when they have no idea what the economic and political landscape is going to look like. But now I've come to realise no one actually knows what Brexit is, including the government who are supposed to deliver it. Worse, they no longer even have a mandate to negotiate Brexit as they're barely in power, they're being held there by the tiny DUP party. Should the DUP withdraw their support, or some back bench Conservative MP's revolt, we'll have no effective government at all. Let alone one in a position to handle negotiations that will shape the UK for decades to come. I don't think I'm the only one coming to this conclusion.
The UK government fought the EU over the agenda for initial negotiations. This agenda was discussed on Monday 19th June'17, and the UK government lost. Today, Mrs. May has put forward a proposal for the three million EU citizens currently living in the UK, it was immediately dismissed by the EU as inadequate. Looks like the UK government is about to lose again. This is not what anyone voted for.
We can't just stop Brexit, as just over half the people voted for it. But it just doesn't seem like it's going to work out for anyone, whether you voted remain or leave. So what is the answer? Another referendum, followed by another election? Maybe. If you've made it this far through this rant without falling asleep, you'll be pleased to read that's my last comment on the matter. Until my next rant.......
For a web site that promotes and distributes PC based accounting software, you might think this blog sometimes goes a bit off message. You'd be right. Many of my blogs have nothing to do with accounts or software, and this one doesn't even have anything to do with our planet! One evening I found myself looking at the sky. There are around 200 billion stars in our galaxy and around 2,000 billion galaxies in the known universe. If my maths is right, that's 400,000,000,000,000,000,000,000 stars. Most with planets around them. So there must be intelligent life out there. But where is everyone?
The universe is 13.8 billion years old. Our own star, the sun, is a second generation star. It's 4.6 billion years old. So a LOT of stars have come and gone before our star was even born. These are all huge numbers. But it takes life a long time to get started, and then develop into something like us. Our planet was created at about the same time as the sun, from the same cloud of dust and gas. Life started around 3.8 billion years ago. Assuming life also started on some other planets, and it's pretty hard to believe that out of 400,000,000,000,000,000,000,000 stars life only started on a small planet orbiting this one, then it's also reasonable to assume that it started earlier on some than on others, and developed at slightly different rates. If you look back at how humans have developed, we first appeared around 200,000 years ago. A blink of the eye when you consider the Earth is 4,600,000,000 years old. It's only really in the last 1,000 years that we've become technically advanced. The last 250 years in particular. In fact, look how far we've come in just the last 50 years. Which is nothing terms of the age of a star or planet.
So, if intelligent life developed elsewhere in the universe, some of it could have reached the technological stage we're at now a long time ago. Probably millions of years ago. Try and imagine how advanced the human race will be in 1,000 years time, 100,000 years, or 10,000,000 years. Even looking 1,000 years into the future is impossible. The technical advances we'll have made in that time are far beyond anything we can imagine (even Star Trek is only set between about 150 and 370 years in the future, depending on the series). Yet there must be thousands, if not millions of intelligent alien civilisations out there who are thousands, if not millions of years ahead of us.
In 1961 Dr. Frank Drake produced an equation that helps work all this out. You can find details on this page on Wikipedia
. However, the equation does require some information that is currently unknown and has to be guessed at, which allows for quite a broad range of answers.
You would have thought they'd be a thriving interstellar community throughout our galaxy. It's an average size galaxy, and we're about two thirds of the way out from the center. If our galaxy was a city, we'd be in the suburbs. You'd have thought we'd be shouting at our alien neighbors to turn the music down! But it's very quiet out there.
We've found no evidence of aliens ever having visited our plant. Various Ceti projects have been searching the skies for over 40 years for alien radio transmissions, and found nothing. We've been sending probes out into space to explore the planets of our solar system for the last 50 years, and none have ever come across any alien hardware or anything to indicate someone else has been here before. Of course, it's always possible the signs are all around us, we're just so used to seeing things a certain way, we can't see what's actually right in front of us?
In the 1970's and 80's Professor Carl Sagan
discussed the possibility of aliens having visited the earth thousands of years ago. But his cautious observations contrasted to those of Erich von Daniken
who wrote several books on the subject. Unfortunately von Danikens less than careful efforts, perhaps due to an over enthusiasm for his subject, lead to some of his work being discredited. But amongst the extensive body of 'evidence' put forward by von Daniken, there are some items that still resist any explanation other than alien visitors.
Assuming we're not so blind as to miss evidence that's right in front our noses (and that may be a big assumption....), as I see it there are other possibilities:
- Other civilisations are so advanced, they know the best thing is to leave us alone to develop all by ourselves. Until such time as we're ready to join the interstellar community. That could be hundreds of years away. In the meantime they make sure we don't get visited and don't receive radio or any other signals that might cause us all kind of problems if we realised we're not alone.
- Alien civilisations are avoiding us because we're simply not of interest. We don't pick up any radio signals because technically advanced civilisations don't use radio to communicate.
- There aren't any advanced alien civilisations out there, because life or intelligent life never developed anywhere else, and our planet is truly unique. Which seems improbable. Though I believe it's a central tenet of most religions, which is thought provoking.
- Chillingly, a civilisation can only develop so far before it makes itself extinct. Either through war, or artificial intelligence which decides the animals that created it no longer serve a purpose, and/or that the existence of any form of intelligence serves no purpose. Alternatively, perhaps by some other method that hasn't yet occurred to us.
This last possibility troubles me greatly. The idea of extinction isn't very appealing, or course, and worse it's actually quite possible. Consider this: out of the 200 billion stars in our galaxy, lets say at some time life developed on 1 billion planets, of those, intelligent life developed say on just 1 million of them (that's 1 planet in 1,000). Bear in mind, these figures could well be overoptimistic. If each civilisation on average only survives being technically advanced for say 1,000 years (ie. from the point they discover electricity to their extinction), the chances of us living at the same time as another advanced civilisation in our galaxy look remote. If there have only been 1 million advanced civilisations in our galaxy, and each one on average lasts for 1,000 years, even if we strung them end to end they would only cover a time span of 1 billion years. But our planet has been around for 4.6 billion years, and the galaxy a lot longer than that. If we're late to the party, it was all over a long time ago, probably long before our ancestors even dropped from the trees and stood on two feet.
What ever the reason we haven't found evidence of intelligent alien life, we will one day have an answer. One way or the other. Sadly, that day will probably be long after my 'use by' date has expired! Perhaps one of my descendants, or one of your descendants will shake the hand of an alien, or stare at what's left of a once great civilisation that existed thousands years ago, just a hundred light years from where I'm sat now.
If you would like to comment on any of the issues covered in Mike's blogs, or would like to suggest some improvements to the software, please email: firstname.lastname@example.org