Does innovation arc toward decadence?

I doubt that. A lot of "low-hanging fruit" probably wasn't low-hanging when initially harvested.

Slowdown? It seems to me that innovation has _exploded_ recently (say the last 4-8 years) - soft AI is suddenly everywhere, new wearables are everywhere and can do things that seem like magic to me, philips put a wifi reciever in a lightbulb and I can talk to my phone (I am afraid of cursing at my computer, one of these days it is going to talk back).

On the not so electronic front serious steps are being made to put a colony on MARS, new innovations in medicine is being made, etc.

This is the core of Tyler Cowen's "Average Is Over." I liked the articles premise, but I think Occam would lean towards Cowen's thesis as being correct. The ability to truly innovate (on the _level_ of steam engines and electricity, which is what we're talking about) now requires a lot more time and effort. We've also (since the 1980s) become a short-termist culture (transparency, accountability, and demands for ROI do, in fact, have a downside) which has caused us to pull back on R&D (especially using public money for moonshots.) The best we can hope for now is that our new Bell Labs-equivalents (Google, Musk and Co., even Facebook) continue to subsidize innovation R&D that does not guarantee a return, but would have immense effects if they did (Calico, autonomous cars, etc.)