Tag: Paul Ehrlich

This is your good news and history lesson for the day.

The Simon Abundance Index: A New Way to Measure Availability of Resources
(Citations omitted below.)

Summary in a sentence: “As population increases, the time-price of most commodities will get cheaper for most people, most of the time. Unfortunately, most people will assume the opposite.”

It occurred to me when reading this that the simple bet about the future price of a few commodities, between University of Maryland economist Julian Simon and Stanford University biology professor Paul R. Ehrlich, is unknown to most people today. After all, it was made in 1980 and settled in 1990.

I read Ehrlich’s Population Bomb (1968) and The Club of Rome’s Limits to Growth (1972) when they were first published. Ehrlich assured us that mass starvation was inevitable and imminent. The Club of Rome predicted a dire future caused by shortages of food, water, and all manner of commodities – because of human population growth.  By 1973 we were experiencing severe oil shortages, leading to President Carter’s “malaise” speech.  By 1976 Greenpeace was fundraising off the (allegedly staged) torture of baby seals in Newfoundland as a demonstration of human environmental rapaciousness.

All this gave me pause: Maybe predictions of economic and social collapse based on running out of “stuff” were plausible. Little could be done quickly, but it was critical to DO SOMETHING NOW. There is a pattern there we see today.

To mitigate, not prevent, mass starvation, Ehrlich called on governments world-wide to implement draconian population control.

By 1979 the Chinese had done so, with their “one child” policy. One result was 338 million aborted Chinese babies, the majority of them female. While sex selective abortion was banned in China in 2005, there are still 17% more males born than females. This is triple the natural rate difference, so one might suspect the ban is not totally effective.  There’s another effect from the one child policy; “By 2030, projections suggest that more than 25 percent of Chinese men in their late 30s will never have married.” There are a host of societal woes that will result from that.

China tried Ehrlich’s experiment and it’s turned out badly for them.

So, the ‘the bet’ was important in many ways. It was a test of humanity’s future; and, on one side, a prescription to avoid disaster. That prescription is still proposed.

To it, CAGW promoters have added the idea that preventing destruction of all life on earth depends on massive and economically crippling world-wide government intervention. This would certainly curb population growth and reduce human well-being. Going for the absurd conclusion, radical environmentalists call for human extinction.  Ehrlich’s ideas inform both groups.

Like climate modellers whose models don’t work, Professor Ehrlich has not given up on his thesis. In 2013 he said:

[Human civilization] is threatened with collapse by an array of environmental problems… . The human predicament is driven by overpopulation, overconsumption of natural resources … and socio-economic-political arrangements to service Homo sapiens’ aggregate consumption.

…but if he is wrong – again – we would be well advised to ignore him.  We would find ourselves far less able to navigate existential threats due to restricted trade, fewer ideas, slower innovation, smaller productive capacity, and less wealth.

When you hear the term “sustainable growth,” that’s what is meant.

The whole Simon Abundance article is worth reading, and I hope to encourage you to do so, even though it’s long. There’s much more there than just the Ehrlich/Simon bet. It is worth reflecting on the miracle of human ingenuity, stoked by capitalism: Half the world is now middle class or wealthier. I doubt this would be true if the entire world had adopted Ehrlich’s advice in 1975.

Intro to the Simon Abundance article:

Humanity, the latest estimates suggest, is roughly 300,000 years old. For the first 99.9 percent of our time on Earth, Homo sapiens lived a short and difficult life that ended, all too often, in violent death. We roamed the world afraid, cold, hungry, and sick. Remedies to ease our suffering were few. In the past 250 years or so, however, human fortunes dramatically improved. An accumulation of incremental technological, scientific, and ideological advances led to the Industrial Revolution, which ushered in an age of abundance.

That is the trajectory Ehrlich told us was over in 1968.  Simon challenged the idea:

After intellectually sparring with one another in print for most of the 1970s, [University of Maryland economist Julian] Simon finally challenged [Stanford University biology professor Paul R.] Ehrlich to a wager on resource depletion. Ehrlich would choose a “basket” of raw materials that he expected would become less abundant in the coming years and choose a time period of more than a year, during which those raw materials would become more expensive. At the end of that period, the inflation-adjusted price of those materials would be calculated. If the “real” price of the basket was higher at the end of the period than at the beginning, that would indicate the materials had become more precious and Ehrlich would win the wager; if the price was lower, Simon would win. The stakes would be the ultimate price difference of the basket at the beginning and end of the time period.

The positions:
Ehrlich:

The battle to feed all of humanity is over. In the 1970s hundreds of millions of people will starve to death in spite of any crash programs embarked upon now. At this late date nothing can prevent a substantial increase in the world death rate.

Simon:

There is no physical or economic reason why human resourcefulness and enterprise cannot forever continue to respond to impending shortages and existing problems with new expedients that, after an adjustment period, leave us better off than before the problem arose… . Adding more people will cause [short-run] problems, but at the same time there will be more people to solve these problems and leave us with the bonus of lower costs and less scarcity in the long run… . The ultimate resource is people-skilled, spirited, and hopeful people who will exert their wills and imaginations for their own benefit, and so, inevitably, for the benefit of us all.

Ehrlich chose copper, chromium, nickel, tin, and tungsten. The bet was agreed to on September 29, 1980, with September 29, 1990, being the payoff date. In spite of a population increase of 873 million over those 10 years, Ehrlich lost the wager. All five commodities that he had selected declined in price by an average of 57.6 percent. Ehrlich mailed Simon a check for $576.07.

Since the conclusion of the bet, Ehrlich’s supporters have argued that Simon got lucky: had the bet taken place over a different decade, the outcome might have been different. The debate continues to this day. In 2016, Southern Methodist University economists Michael Cox and Richard Alm revisited the Simon-Ehrlich wager and found that Ehrlich’s metals were 22.4 percent cheaper in 2015 than they had been in 1980.

In an essay titled, “Onward and Upward! Bet on Capitalism-It Works,” Cox and Alm proposed a new methodology to evaluate Simon’s thesis. “The real price of everything,” as Adam Smith pointed out, “is the toil and trouble of acquiring it… . What is bought with money … is purchased by labour.” The cost of human labor, Cox and Alm note, tends to increase faster than inflation. From the perspective of average hourly wages in the United States, therefore, the real price of Ehrlich’s minerals fell by 41.8 percent between 1980 and 2015. According to Cox and Alm, in “work-hour terms, Simon wins The Bet [with Ehrlich] in every year from 1980 to 2015.”

When Jordan Peterson looks around a lecture venue and reminds us of the absolute miracle that the lights always work, the room is warm, and it is safe from wolves; he is speaking about the same thing. When he complains that rejecting the cultural underpinnings of this miracle is thoughtless ingratitude; he is correct.

If we can just keep the government hand on us light, we can continue to enjoy abundance.

Update: 1-Dec-18, 11:59
Prominent Environmentalist Finally Discovers His Religion’s Catch-22

Economic growth is a cancer, in this view. Its bad effects are permanent and cumulative, its blessings are evanescent and ultimately trivial.

Malthusianism is a religious conviction that desperately needs to think of itself as a science. From Thomas Malthus and his mathematical certainties to Paul Ehrlich with his famine timetables and the Club of Rome with its ‘scientific’ predictions of resource exhaustion, Malthusians have made confident predictions about the future and claimed scientific authority for statements that turned out to be contemptibly silly. That is the brutal fate that often awaits people who can’t keep the boundaries between science and religion straight.

The Catch 22 is that “sustainable” economic growth is code for economic decline (links omitted).