Big Ideas I: The World Isn't Going to Hell

Matt Ridley, author of book called The Rational Optimist, starts his Ted Talk this way:

When I was a student here in Oxford in the 1970s,the future of the world was bleak. The population explosion was unstoppable. Global famine was inevitable. A cancer epidemic caused by chemicals in the environment was going to shorten our lives.The acid rain was falling on the forests. The desert was advancing by a mile or two a year. The oil was running out. And a nuclear winter would finish us off.  

I lived back then. I remember these dire predictions. And because all these claims were supported by large amounts of data and backed by respected academics, they seemed credible. Our doom seemed inevitable. And to top it off, the war in Vietnam was ramping up. A lot of us felt hopeless and helpless.

In 1968 Paul Ehrlich published "The Population Bomb." Ehrlich's thesis: resources are finite. Population is growing exponentially. Many people were already starving, and with growth, more and more would starve. Sooner or later (sooner, Ehrlich said) we would run out of food. Early editions said this:

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.

Cover via AmazonIn 1972 a think tank called "The Club Of Rome" published a report called "Limits to Growth." Wikipedia describes the Club of Rome as a group of " current and former Heads of State, UN bureaucrats, high-level politicians and government officials, diplomats, scientists, economists, and business leaders from around the globe.^[1]  Using computer models developed at MIT and data on available resources to support their claims, the authors argued that the world was rapidly running out of resources, and with population growing exponentially, predicted that population would overshoot world's ability to sustain its population. According to the models, The inevitable result would be mass starvation, chaos, war, and Other Bad Things.

Around that time I read two books that not only changed my way of thinking about these predicted crises, but changed my way of thinking about all later projected doom scenarios . One book was "Utopia and Oblivion," by R. Buckminster Fuller. The other was "The Year 2000" by Herman Khan.

From Fuller's book I remember these key ideas:

• Prosperity is the best form of population control. In poor countries it is rational for parents to have as many children as possible: children are cheap to raise, and if one or several are even moderately successful, then they can support the parents in old age. In rich countries, it is rational for parents to have only a few children: children are expensive to raise, and there are other ways that aging parents can sustain themselves. So as countries become more wealthy, their reproduction rate drops.
• The world is becoming more prosperous. While it's awful that billions still live in poverty, it's also true that billions today live better than kings did a few hundred years ago.
• The history of the world is the story of doing "more and more with less and less." Fuller cites, among other trends, the change in the number of hours spent working for necessities (we get more and more food with less and less work), the amount of material required to build a building (we get bigger and better buildings with less and less material), the growth in food production (more and more food from less and less land.)

(I also learned that it is counter-factual to refer to sunrise and sunset. Fuller reminds us that since we know that the sun neither rises nor sets, we should properly refer to both events as "earth turn." He likewise points out that upstairs and downstairs are counterfactual descriptions. Since the earth is roughly a sphere we move in and out, not up and down. His recommended terms are outstairs and instairs.)

Khan argued that the apparent scarcity of resources was an illusion. We've had about 100 years of oil since oil first became a commercially important commodity despite exponentially growing demand. We had (as I remember) only about seven years of tin. Khan argues that since it costs money to explore for new resources, the investment in finding new resources should be based on the difficulty of finding them. Tin is very easy to find, so it does not make sense building inventories. Oil is somewhat harder, so a hundred years worth seems to be a stable number.

Doom-sayers are right to say "if things go on as they are" then things will get bad. But they have been repeatedly wrong when they assume that things will go on as they are. Nearly all earlier similar predictions have proven fabulously wrong.

In 1980 Julian Simon, a professor of economics at the University of Maryland, and the doom-saying Paul Ehrlich made a wager. Simon challenged Ehlich to choose any five commodity metals that he believed would be in dramatically shorter supply (and therefore would demand a higher price) over a ten year period. The wager was based on a $200 investment in each of the metals, and the agreement was that Simon would pay Ehrlich the difference between the initial price and the closing price if prices went up, and that Ehrlich would pay Simon the difference if they went down. Simon's potential loss on the wager was unbounded. If to cost of the metals rose by a factor of 20, he'd be out $20,000. Ehrlich's loss was bounded: if the cost dropped to zero, he'd only pay $1,000.

In fact, Ehrlich lost more than 500.00 on the wager. And despite all his predictions having been completely wrong, still maintains the rightness of his position.  He said:

The bet doesn't mean anything. Julian Simon is like the guy who jumps off the Empire State Building and says how great things are going so far as he passes the 10th floor. I still think the price of those metals will go up eventually, but that's a minor point. The resource that worries me the most is the declining capacity of our planet to buffer itself against human impacts. Look at the new problems that have come up: the ozone hole, acid rain, global warming. It's true that we've kept up food production -- I underestimated how badly we'd keep on depleting our topsoil and ground water -- but I have no doubt that sometime in the next century food will be scarce enough that prices are really going to be high even in the United States.

Ehrlich's metaphor is as flawed as the reasoning that lost him his bet. No sane individual who jumps off the Empire Sate Building would say how great things are going. His stomach would be doing flip flops; he'd be spinning around unable to do anything useful or productive; the wind would be tugging at his clothing. And there is no self-regulating feedback mechanism that would keep him from inevitably hitting the ground and splattering.