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Unsustainable: Little Ways Environmentalists Waste the Ultimate Resource – Article by Timothy D. Terrell

Unsustainable: Little Ways Environmentalists Waste the Ultimate Resource – Article by Timothy D. Terrell

The New Renaissance HatTimothy D. Terrell
June 23, 2015
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The memo told me to get rid of my printer — or the college would confiscate it.

The sustainability director — let’s call him Kermit — is an enthusiastic and otherwise likable fellow whose office is next door to mine. Kermit had decided it would be better if the centralized network printers in each department were used for all print jobs. He believed that the environment was going to benefit from this printer impoundment.

Some sustainability advocates object to printers because little plastic ink cartridges sometimes wind up in landfills — but I saw no effort at the college to promote cartridge recycling; the sustainability policy had skipped persuasion and gone straight to confiscation.

Certainly the IT people didn’t want to maintain the wide variety of desktop printers or supply them with cartridges — but the printer on my desk was not college-supplied or maintained, and I provided all my own cartridges. Personal printers were now verboten. Period. The driver behind the policy, apparently, was the rectangular transformer box plugged into the wall, which consumed a trickle of a few watts of electricity 24/7.

A typical household inkjet printer draws about 12 watts when printing, and when it’s not, it draws about 5 watts. At 5 watts per hour, then, with a few minutes a week burning 12 watts, my lightly used inkjet would use around 46 kWh a year, which at the commercial average rate of 11 cents per kilowatt-hour translates to an annual cost of $5.06. There may be side effects, or externalities, to use a term from economics. A 2011 study in the Annals of the New York Academy of Sciences that renewable energy advocates often cite estimates that the side effects of coal-produced electricity cost about 18 cents per kWh, so assuming that all the electricity saved would have been produced by burning coal (nationwide, it’s actually less than 40 percent), that brings the total annual cost to $13.34.

Kermit must have calculated that confiscating printers would collectively generate several hundred dollars a year of savings for the college — and allow the college to put another line on its sustainability brag sheet.

There’s certainly nothing wrong with trying to save electricity. But Kermit had forgotten the value of an important natural resource: human time.

Time is a valuable resource: labor costs are a large chunk of most businesses’ costs. The college basically wanted to save electricity by wasting my time — and everyone else’s.

Here’s how that works. Suppose I want to print out a recommendation letter and envelope on college letterhead. Using the network printer involves the following steps:

  1. Walk down hall with letterhead and insert letterhead in single-feed tray.
  2. Return to office.
  3. Hit Enter and walk back to printer.
  4. Discover that page was oriented the wrong way and printed upside down.
  5. Return to office.
  6. Walk back to printer with new letterhead page.
  7. Return to office.
  8. Hit Enter and walk back to printer.
  9. Discover that someone else had sent a job to the printer while I was in transit and printed his test on my letterhead.
  10. Return to office.
  11. Walk back to printer with new letterhead page.
  12. Wait for other guy’s print job to finish.
  13. Insert letterhead, properly oriented.
  14. Run back to office to reduce chances of letterhead being turned into another test.
  15. Hit Enter and walk back to printer.
  16. Pick up successfully printed letter.
  17. Walk back to office, quietly weeping at the thought of repeating the process to print the envelope.

This “savings” turns into more than 12 trips to and from the communal printer, plus any time spent waiting for another print job. The environmentalist may bemoan the two wasted sheets of paper, but he would quickly remember that there’s a recycling bin beside the printer. The more significant cost of this little fiasco is human time.

Let’s suppose that’s a total of six minutes. Of course, I’ve learned the right way to orient paper and envelopes after a mistake or two, and printer congestion is rarely a problem. And I never did higher-volume print jobs, such as tests for classes, on my own inkjet anyway, so the lost time in trotting back and forth would apply mainly to one- or two-sheet print jobs, envelopes, and scanning. Suppose the confiscation of my inkjet means, conservatively, five additional minutes a week during the school year. That’s about three hours a year sucked out of my life, absorbed in walking back and forth.

Suppose, again to be conservative, my time is worth what fast food restaurant workers in Seattle are getting paid right now — $15 per hour. So the university is wasting $45 of my salary to save $13.34 in utilities. Does that sound like the diligent stewardship of precious resources?

(I will assume that any health benefits from the additional walking are canceled out by the additional stress caused by sheer aggravation.)

I am pleased to say that the desktop printer kerfuffle ended with the sustainability director backing down. We were all allowed to keep our printers, and I thereby kept three hours a year to do more productive work. Kermit and I remained on good terms, though he never took me up on my offer to provide an economist’s voice on the sustainability committee.

But we must make the most of small victories, for college and university sustainability proponents march on undeterred. If anything, the boldness and scale (and the waste) of campus initiatives has only increased. The National Association of Scholars (NAS) recently released a report showing that colleges trying to reduce their environmental impact have spent huge amounts of money on sustainability programs for little to no gain.

The unintended consequences of these programs abound. And though each initiative may destroy only a small amount of human time, the collective impact of these microregulations is a death by a thousand cuts.

Many college cafeterias are now “trayless,” in the hopes of reducing dish use and wasted food. But students must manage unwieldy loads of dishes, leading to inevitable spills, or make multiple trips (and student time is valuable, too). One study mentioned in the NAS report found that “students without trays tend to run out of hands and to skip extra dishes — usually healthy dishes such as salads — in order to better carry their entrée and dessert. This leads to students consuming relatively fewer greens and more sweets.”

A college’s “carbon footprint” has also become the object of campus policy. Middlebury College, for example, pledged in 2006 that it would be “carbon neutral” by 2016. So it has spent almost $5 million a year (over $2,000 per student) on things like a biomass energy plant, organic food for the dining hall, and staff and faculty tasked with improving sustainability. All of this has cost the college about $543 per ton of CO2 reduction. So even if one accepts the $39 per ton figure the Obama administration has stated as the value of reducing carbon dioxide emissions (and I, for one, am skeptical), Middlebury has greatly overpaid.

We can all appreciate the desire to be good stewards of the resources entrusted to us. But this doesn’t mean that every environmental sustainability initiative makes sense. Overpaying to reduce CO2 emissions, as with Middlebury, means that the product of hours of our work is needlessly consumed, and we have fewer resources for other valuable pursuits.

Sustainability advocates need to remember that resources include more than electricity, water, plastic, paper, and the like. Humans have value, too, here and now. Chipping away at our lives with little directives to expend several hours saving a bit of electricity, water, or some other resource, is to ignore the value of human life and to waste what Julian Simon called “the ultimate resource.”

Timothy Terrell is associate professor of economics at Wofford College in South Carolina.

This article was published by The Foundation for Economic Education and may be freely distributed, subject to a Creative Commons Attribution 4.0 International License, which requires that credit be given to the author.

Overpopulation: Pictures vs. Numbers – Article by Bradley Doucet

Overpopulation: Pictures vs. Numbers – Article by Bradley Doucet

The New Renaissance HatBradley Doucet
June 15, 2015
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Two hundred years ago, there were about a billion humans in the world. Today, there are seven billion and counting. This fact has some people concerned that we’re going to run out of food, energy, or other important resources in the foreseeable future. Some worry that we’re going to pollute the natural environment so much that we render it uninhabitable, or at least much less habitable.

As an example of such concerns, a friend of mine recently posted a link to a series of photographs purporting to show that the planet is overpopulated. The first shows “Sprawling Mexico City roll[ing] across the landscape, displacing every scrap of natural habitat.” Another shows greenhouses “as far as the eye can see” in Spain. Another still, a surfer threading the eye of a wave that is littered with garbage.

Some of the photos in this series are actually quite beautiful, but some are indeed ugly, and all are arresting. Yet as evocative as these images are, the scenes they depict are just tiny snippets of an enormous planet. Mexico City, sprawling though it is, covers an area of about 1,500 square kilometres. That may sound like a lot, but it’s just 1/100,000 of the Earth’s 150 million square kilometres of land area. The things illustrated by these photos may be bad—although some are frankly neutral—but they tell us nothing about how widespread the specific problems they allude to may be. To determine the scope of the population issue, pictures are not sufficient; we need the help of numbers.

How Many Is Too Many?

“We undeniably face huge challenges,” admits Hans Rosling in the opening minutes of Don’t Panic: The Truth about Population, “but the good news is that the future may not be quite as gloomy and that mankind already is doing better than many of you think.” In this hour-long documentary, Rosling, a Swedish professor of global health and a renowned TED-talk speaker, makes the numbers behind population growth come alive. And while not denying that human activity does indeed often cause pollution as a side effect, and does indeed use resources, he challenges the narrative of the doomsayers.

Most importantly, he drives home the fact that population growth is already slowing. Yes, Bangladesh’s population has grown dramatically in his lifetime, he tells us, tripling from about 50 million to about 150 million. But do we need to convince Bangladeshis to have fewer children? No, because the job is already done. Although still a poor country, Bangladeshis have grown richer in recent decades. As many of them have moved out of extreme poverty, child mortality rates have plummeted, and birth rates have fallen in turn. Bangladeshi women now have just over two children each on average.

There are still places in the world with much higher birthrates, of course, primarily in rural parts of Asia and Africa. But contrary to public perception, much work has already been accomplished. And as more of the poorest nations move out of poverty in the coming decades—Africa and Asia being home to the fastest growing economies in the world—birthrates will come down everywhere. The best estimates are that we will hit about 9 billion by mid-century, and top out at around 10 or 11 billion by 2100. After that, no more population growth.

But 11 billion is still a lot. Can the Earth sustain even that stable population?

We should of course try to limit our negative impact on the environment as much as we can, within reason. But that is precisely what we have been doing as we have gotten richer and have been able to afford to care more about the state of the natural environment. And contrary to what doomsayers like Paul Ehrlich predicted in the 1960s and 1970s, there has not been mass starvation in the industrialized world, and there has been less and less of it in the poorer parts of the planet. If you think the future nonetheless still looks grim, you may not be looking hard enough, because there are in fact many reasons to be optimistic.

Are there now, or will there soon be, too many of us? Part of your answer to that question depends on whether you think of each new human being as just another mouth that needs feeding, or whether you recognize that those mouths generally come attached to human minds—the ultimate resource.

 

Bradley Doucet is a writer living in Montreal. He has studied philosophy and economics, and is currently completing a novel on the pursuit of happiness. He also is Le Québécois Libre’s English Editor.

Humanity Doomed, Says Chicken Little – Article by Bradley Doucet

Humanity Doomed, Says Chicken Little – Article by Bradley Doucet

The New Renaissance Hat
Bradley Doucet
January 5, 2015
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A study by a team of NASA-funded researchers has been getting a lot of play in recent months. Headlines scream about the “irreversible collapse” of civilization if we don’t smarten up. In order to stave off disaster, the study says, we need to a) reduce economic inequality, and b) reduce resource consumption, both by using less and by reducing population growth. But a closer look suggests that reports of humanity’s future demise may have been greatly exaggerated.

There are many contentious ideas in the snippets of the forthcoming study excerpted in the various articles I read, but one of them trumps the rest: the time frame. Though some articles fail to get specific, others report the study’s predictions of when we can expect the sky to fall. The best-case scenarios apparently give us 1,000 years before it all comes crumbling down, whereas the worst-case ones give us just 350.

Are you kidding me? Your mathematical models predict collapse in three to ten centuries, and I’m supposed to take you seriously? To quote Michael Crichton, if people in the year 1900 had been worried about their descendants just one hundred years in the future, they probably would have wondered, “Where would people get enough horses? And what would they do about all the horse [manure]?” Today, of course, horse manure in city streets is not a very big problem, thanks to the widespread use of motorized vehicles. A hundred years from now, today’s specific problems will have been replaced by other as yet undreamt of challenges. Three hundred years from now? Please.

By all means, let’s do what we can to reduce economic inequality and use resources wisely instead of wastefully. I suggest greater reliance on markets for both objectives. Population growth is already slowing as people around the world get wealthier, and last I checked, was set to top out at nine or ten billion in the second half of the 21st century. But nobody has any idea what technologies will have been developed in a hundred years, much less three hundred. I don’t, you don’t, and those NASA-backed researchers don’t—whatever their models may say.

Bradley Doucet is Le Québécois Libre‘s English Editor and the author of the blog Spark This: Musings on Reason, Liberty, and Joy. A writer living in Montreal, he has studied philosophy and economics, and is currently completing a novel on the pursuit of happiness.

For the Love of Money? – Article by Gary M. Galles

For the Love of Money? – Article by Gary M. Galles

The New Renaissance Hat
Gary M. Galles
April 13, 2014
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It’s not unusual to hear market systems criticized for relying too much on money, as if this comes at the expense of the altruistic relationships that would otherwise prevail. Ever heard the phrase “only in it for the money”? It’s as if self-interest has a stink that can corrupt transactions that generate benefits for others, turning them into offenses. So this line of thinking suggests reliance on market systems based in self-ownership would be tantamount to creating a world where people only do things for money, and lose the ability to relate to one another on any other terms.

People Don’t Do Everything for Money

One need not go far to see the falsity of the claim that everything is done for money in market systems. My situation is but one example: I have a Ph.D. in economics from a top graduate program. It is true that, as a result, I have an above-average income. But I did not do it all for the money. One of my major fields was finance, but if all I cared about was money—as my wife reminds me when budgets are particularly tight—I would have gone into finance rather than academia and made far more. But I like university students. I think what I teach is important, and I value the ability to pass on whatever wisdom I have to offer. I like the freedom and time to pursue avenues of research I find interesting. I enjoy the ability to tell and write the truth as I see it (particularly since I see things differently from most) and I prefer a “steady job” to one with far more variability.

Every one of those things I value has cost me money. Yet I chose to be a professor (and would do it again). While it’s true that the need to support my family means that I must acquire sufficient resources, many things beyond just money go into choosing what I do for a living. And the same is true for everyone.

Ask any acquaintances of yours who they know that only does things for money. What would they say? They would certainly deny it about themselves. While they might apply this characterization to people they don’t know, beyond Dickens’s Ebenezer Scrooge and his comic book namesake, Scrooge McDuck, they would be unable to provide a single convincing example. If market critics performed that same experiment, they would recognize that they are condemning a mirage, not market arrangements.

Confusing Ends and Means

Beyond the fact that all of us forego some money we could earn for other things we value, the fact that every one of us gives up money we have earned for a vast multitude of goods, services, and causes also reveals that individuals don’t just do things for the money. Each of us willingly gives up money up to further many different purposes we care about. Money is not the ultimate end sought, but a means to a vast variety of possible ends. Mistakenly treating money as the end for which “people do everything” is fundamentally flawed—both for critics of the market and for the participants in it.

To do things for money is nothing more than to advance what we care about. In markets, we do for others as an indirect way of doing for ourselves. This logic even applies to Scrooge. His nephew Fred’s assertion that he doesn’t do any good with his wealth is false; he lends to willing borrowers at terms they find worth meeting, expanding the capital stock and the options of others.

That an end of our efforts is to benefit ourselves, in and of itself, merits neither calumny nor congratulations. Money’s role is that of an amoral servant that can help us advance whatever ends we ultimately pursue, while private property rights restrict that pursuit to purely voluntary arrangements. Moral criticism cannot attach to the universal desire to be able to better pursue our ends or to the requirement that we refrain from violating others’ rights, only to the ends we pursue.

To do things for money in order to achieve world domination could justify moral condemnation. But the problem is that your intended end will harm others, not the fact that you did some things for money, benefitting those you dealt with in that way, to do so. Using money to build a leprosarium, as Mother Teresa did with her Nobel Prize award, does not justify moral condemnation. Similarly, using money to support your family, to live up to agreements you made with others, and to try not to burden others is being responsible, not reprehensible. Further, there is nothing about voluntary arrangements that worsens the ends individuals choose. But by definition, they place limits on ends that require harming others to achieve them.

It is true that money represents purchasing power that can be directed to ends others object to. Money is nothing more than a particularly powerful tool, and all tools can be used to cause harm. Just as we shouldn’t have to forego the benefits of hammers because somebody could cause harm with one, there’s no reason to think society would be better off without money or the market arrangements it makes possible just because some people can use those things for harmful ends. And if the ends aren’t actually causing harm, then the objections over them come down to nothing more than disagreements about inherently subjective valuations. Enabling a small class of people to decide which of these can be pursued and which can’t makes everyone worse off.

Those who criticize people for doing everything for money also do a great deal for money themselves. How many campaigns have religious groups and nonprofit organizations run to get more money? How much of government action is focused on getting more money? Why do the individuals involved not apply the same criticism to themselves? Because they say they will “do good” with it. But every individual doing things for money also intends to do good, as he or she sees it, with that money. And if we accept that people are owners of themselves, there is no obvious reason why another’s claims about what is “good” should trump any “good” that you hold dear, or provide for another in service through exchange.

Criticizing a Straw Man

Given that the charge that “people do everything for money” in market systems is both factually wrong and logically lame, why do some keep repeating it? It creates a straw man easier to argue against than reality, by misrepresenting alternatives at both the individual and societal level.

At the individual level, this assertion arises when people disagree about how to spend “public” resources (when we respect private property, this dispute disappears, because the owner has the right to do as he or she chooses with it, but cannot force others to go along with or allow it; “public” resources are obtained by force). The people who wish to spend other people’s confiscated resources in ways the original owners disagree with claim a laundry list of caring benefits their choice would provide, but foreclose similar consideration of the harms that would be caused to those they claim care only about money. That, in turn, is used to imply that the purportedly selfish person’s claims are unworthy of serious attention. (Something similar happens when politicians count “multiplier effects” where government money is spent, but ignore the symmetrical negative “multiplier effects” radiating from where the resources are taken.)

This general line draws support from a misquotation of the Bible. While more than one recent translation of 1 Tim 6:10 renders it “the love of money is a root of all sorts of evils,” the far less accurate King James Version rendered it, “the love of money is the root of all evil.” When one simply omits or forgets the first three words, it becomes something very different—“money is the root of all evil.” Portray those who disagree with your “caring” ends as simply loving money more than other people, and they lose every argument by default. Naturally, it’s a seductive strategy.

At the societal level, criticizing market systems as tainted by the love of money implies that an alternate system would escape that taint and therefore be morally preferable. By focusing attention only on an imaginary failing of market systems that would be avoided, it allows the implication of superiority to be made without having to demonstrate it. This is a version of the Nirvana fallacy.

By blaming monetary relationships for people’s failings, “reformers” imply that taking away markets’ monetary nexus will somehow make people better. But no system makes people angels; all systems must confront human flaws and failings. That means a far different question must be addressed: How well will a given system do with real, imperfect, mostly self-interested people? And it shouldn’t be necessary, but most political rhetoric makes a second question nearly as important: Does the given system assume that people are not imperfect and self-interested when they have power?

Given that the utopian alternatives offered always involve some sort of socialism or other form of tyranny, an affirmative case for them cannot be made. Only by holding the imaginary “sins” of market systems to impossible standards, while holding alternatives to no real standards except the imagination of self-proclaimed reformers, can that fact be dodged. But there’s nothing in history or theory that demonstrates that overwriting markets with expanded coercion makes people more likely to do things for others. As Anatole France noted, “Those who have given themselves the most concern about the happiness of peoples have made their neighbors very miserable.” And as economist Paul Heyne wrote, “Market systems do not produce heaven on earth. But attempts by governments to repress market systems have produced . . . something very close to hell on earth.

Money at the Margin

Money is not everything. But changes in the amounts of money to be earned or foregone as a result of decisions change our incentives at the many margins of choice we face, and so change our behavior. Such changes—money at the margin—are the primary means of adjusting our behavior in the direction of social coordination in a market system.

Changes in monetary incentives are how we adapt to changing circumstances, because whatever their ultimate ends, everyone cares about commanding more resources for those purposes they care about. It is how we rebalance arrangements when people’s plans get out of synch, which is inevitable in our complex, dynamic world. In such cases, changing money prices allow each individual to provide added incentives to all who might offer him assistance in achieving his ends, even if he doesn’t know them, doesn’t know how they would do so, and doesn’t think about their wellbeing (in fact, it applies even if he dislikes those he deals with, as long as the benefits of the arrangements exceed his perceived personal cost of doing so).

For instance, consider a retail gas station faced with lengthy lines of cars. That reflects a failure of social cooperation between the buyers and the seller. Those in line are revealing by their actions that they are willing to bear extra costs beyond the current price to get gas, but their costs of waiting do not provide benefits to the gas station owner. So the owner will convert those costs of waiting in line, which are going to waste, into higher prices (unless prevented by government price ceilings or antigouging directives) that benefit him. That use of money at the margin benefits both buyers and sellers and results in increased amounts of gasoline supplied to buyers.

Further, people can change their behavior in response to price changes in far more ways than “outsiders,” unfamiliar with all the local circumstances, realize. This makes prices, in turn, far more powerful than anyone recognizes.

Consider water prices. If water prices rose, your first thought might well be that you had no choice but to pay them. You might very well not know how many different responses people have already had to spikes (ranging from putting different plants in front yards to building sophisticated desalinization plants). Similarly, when airline fuel prices rose sharply, few recognized in advance the number of changes that airlines could make in response: using more fuel-efficient planes, changing route structures, reducing carry-on allowances, lightening seats, removing paint, and more.

If people recognized how powerful altered market prices are in inducing appropriate changes in behavior, demonstrated by a vast range of examples, they would recognize that the cost of abandoning money at the margin, which enables these responses by offering appropriate incentives to everyone who could be of assistance in addressing the problem faced, would enormously exceed any benefit.

Massive Improvements in Social Cooperation

If we could just presume that individuals know everyone and all the things they care about and the entirety of their circumstances, we could imagine a society more focused on doing things directly for others. But in any extensive society, there is no way people could acquire that much information about the large number of people involved. Instead, this would extend the impossible information problem that Hayek’s “The Use of Knowledge in Society” laid out in regard to central planners. You can care all you want, but that won’t give you the information you need. Beyond that insuperable problem, we would also have to assume that people cared far more about strangers than human history has evidenced.

Those information and other-interestedness requirements would necessarily dictate a very small society. But the costs of those limitations, if people recognized them, would be greater than virtually anyone would be willing to bear.

Without a broad society, the gains from cross-pollination of ideas and different ways of doing things would be hamstrung. The gains from comparative advantage (areas and groups focusing on what they do best, and trading with others doing the same thing) would similarly be sharply curtailed. A very small society would eliminate the incentive for large-scale specialization (requiring more extensive markets) and division of labor that makes our standard of living possible. Virtually every product that involves a large number of separate arrangements—such as producing cars or the gasoline to power them—would disappear, because the arrangements would be overwhelmed by the costs of making them without money as the balance-tipper. As Paul Heyne once put it,

The impersonal transactions that constitute the market system . . . have, over the course of a few centuries, enormously expanded our ability to provide [for] one another . . . while at the same time vastly extending our freedom both by offering us a multitude of options and by freeing us from arbitrary restrictions on our choice of life goals and on the means to further those goals. To reject impersonal transactions as unethical amounts to rejecting the foundation of modern life.

Conclusion

A pastiche of false premises leads many to reject out of hand what Hayek recognized as the “marvel” of market systems, which, if they had arisen from deliberate human design, “would have been acclaimed as one of the greatest triumphs of the human mind.” This is great for those who seek power over others—they have an endless supply of bogeymen to promise to fight.

But it’s a disaster for social coordination. The record of disasters inflicted on society demonstrates what follows when voluntary arrangements are replaced by someone else’s purportedly superior vision.

But it’s often forgotten. We must continue to make the case.

Gary M. Galles is a professor of economics at Pepperdine University. He is the author of The Apostle of Peace: The Radical Mind of Leonard Read. Send him mail.

This article was originally published by The Foundation for Economic Education.

Longevity Logistics: We Can Manage the Effects of Overpopulation – Article by Franco Cortese

Longevity Logistics: We Can Manage the Effects of Overpopulation – Article by Franco Cortese

The New Renaissance Hat
Franco Cortese
November 5, 2013
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This is a more popularly-oriented version of a scholarly article in review for the Journal of Evolution and Technology.

By far the most predominant criticism made against indefinite longevity is overpopulation. It is the first “potential problem” that comes to mind. But fortunately it seems that halting the global mortality rate would not cause an immediate drastic increase in global population; in fact, if the mortality rate dropped to zero tomorrow then the doubling rate for the global population would only be increased by a factor of 1.75 [1], which is smaller than the population growth rate during the post-WWII baby-boom.

Population is significantly more determined by birth rate than by death rate, simply because many people have more than one natural child.

This means that we should not see an unsustainable rise in population following even the complete cessation of death globally for a number of generations. We will run into problems 3 or 4 generations hence – but this leaves us with time enough to plan for overpopulation before we’re forced to resort to more drastic solution-paradigms like procreation-bans and space colonization.

Moreover, there are a number of proposed, and in some cases implemented, solutions to existing, contemporary problems that can be utilized for the purpose of minimizing overpopulation’s detrimental effects on living space and non-renewable resource constraints. These contemporary concerns include climate change and dependence on non-renewable energy sources, and they are only increasing in the amount of public attention they are attracting.

While these concerns and their potential solutions were not created by overpopulation or with overpopulation in mind, the potentially negative effects of an increasing global population can be effectively combated all the same using such contemporary methods and technologies.

Thus we can take advantage of the solution-paradigms developed for such contemporary concerns as climate change and dependence on non-renewable resources, and borrow from such movements as the sustainability movement and the seasteading movement, so as to better mitigate and effectively plan for the negative repercussions of a growing global population caused by the emergence of effective longevity technologies.

In a session with The President’s Council on Bioethics (as it was composed during the Bush Administration), S. Jay Olshansky [2] reported calculations he performed indicating that complete cessation of the global morality rate today would lead to less population growth than resulted from the post-WWII “Baby Boom”:

This is an estimate of the birth rate and the death rate in the year 1000, birth rate roughly 70, death rate about 69.5. Remember when there’s a growth rate of 1 percent, very much like your money, a growth rate of 1 percent leads to a doubling time at about 69 to 70 years. It’s the same thing with humans. With a 1 percent growth rate, the population doubles in about 69 years. If you have the growth rate — if you double the growth rate, you have the time it takes for the population to double, so it’s nothing more than the difference between the birth rate and the death rate to generate the growth rate. And here you can see in 1900, the growth rate was about 2 percent, which meant the doubling time was about five years. During the 1950s at the height of the baby boom, the growth rate was about 3 percent, which means the doubling time was about 26 years. In the year 2000, we have birth rates of about 15 per thousand, deaths of about 10 per thousand, low mortality populations, which means the growth rate is about one half of 1 percent, which means it would take about 140 years for the population to double.

Well, if we achieved immortality today, in other words, if the death rate went down to zero, then the growth rate would be defined by the birth rate. The birth rate would be about 15 per thousand, which means the doubling time would be 53 years, and more realistically, if we achieved immortality, we might anticipate a reduction in the birth rate to roughly ten per thousand, in which case the doubling time would be about 80 years. The bottom line is, is that if we achieved immortality today, the growth rate of the population would be less than what we observed during the post-World War II baby boom.

We would eventually run into problems, of course, a century down the road, but just so you know the growth rates would not be nearly what they were in the post-World War II era, even with immortality today.

In other words we will only have increased the doubling-time of the global population by a factor of 1.75 if we achieved indefinite longevity today (e.g., a doubling time of 140 years in 2000 compared to a doubling time of 80 years). This means that we will have two to four generations worth of time to consider possible solutions to growing population before we are faced with the “hard choice” of (1) finding new space and resources or else (2) limiting or regulating the global birthrate.

An alternate study on the demographic consequences of life extension concluded that “population changes are surprisingly slow in their response to a dramatic life extension”. The study applied “the cohort-component method of population projections to 2005 Swedish population for several scenarios of life extension and a fertility schedule observed in 2005,” concluding that “even for a very long 100-year projection horizon, with the most radical life extension scenario (assuming no aging at all after age 60), the total population increases by 22% only (from 9.1 to 11.0 million)” and that “even in the case of the most radical life extension scenario, population growth could be relatively slow and may not necessarily lead to overpopulation.” [2]. The total population increase due to the complete negation of mortality given by this study is significantly lower than the figure calculated by Olshansky.

Finding innovative solutions to new and old problems is what humanity does. We have a variety of possible viable options to increase the resources and living space available to humanity already. Moreover, there are several other contemporary concerns that are invoking the development of technological and methodological solutions that can be applied to our own concerns regarding the effects of overpopulation. Surely we can conceive of optimal solutions to these problems (and the more pressing a given problem is, the more funding it receives and the faster the solution to it is accomplished) – and take advantage of the growing methodological and technical infrastructure being developed for related and convergent problems – within the time it will take to feel overpopulation’s effect on living space and resources.

We could, for instance, colonize the oceans [3, 4, 5], drawing from the engineering, construction techniques used to build, maintain, and safely inhabit contemporary VLFSs (Very Large Floating Structures). 75% of the Earth’s surface area is, after all, water. This would increase our potential living space 3-fold – and I say “potential” because we surely don’t currently maximize living space on the 25% of the Earth’s surface occupied by land. Furthermore, humanity has as yet barely ventured beyond the surface of the earth – which is a sphere after all. There is nothing to prevent society building higher and building deeper. Indeed, with contemporary and projected advances in materials science and structural engineering, there is no theoretical limit to the height of structures we can safely build – the space elevator being a case in point. And while there will indeed be a maximum size wherein building higher becomes economically prohibitive (a limit determined to a large extent by the materials used), contemporary megastructures [6] indicate that very large structures can be built safety and cost-effectively. Underground living [7, 8, 9, 10] is another potential solution-paradigm as well; underground structures require less energy, are protected from weathering effects and changing temperatures to a much greater extent than structures exposed to the elements, and are less susceptible to damage from natural disasters. Furthermore, there are a number of underground cities in existence today [11], with existing techniques and technologies used to better facilitate contemporary underground living, which we can take advantage of.

In fact, the problem of limited living space is a contemporary problem for certain nations like Japan, and active projects to combat this growing problem have already been undertaken in many cases. This means that there will be an existing host of solutions, with their own technological and methodological infrastructures, which we can benefit from and take advantage of when the problematizing effects of growing global population become immediate. Not only can we take advantage of the existing engineering methodologies developed for use in the construction of VLFSs, but we can also take advantage of the growing body of knowledge pertaining to megastructural engineering and even existing proposals for floating cities [12, 13, 14, 15, 17, 18]. Another possible solution is artificial islands [19].

Furthermore, in recent years the topic of Very Large Floating Structures [21, 22] has experienced a surge of renewed interest occurring in tandem with the increasing interest in seasteading [23, 24], – that is, the creation of very-large-floating-structures for reasons of political sovereignty as well as to allow corporations to get around the laws of a given nation by occupying an area outside of exclusive economic zones. This renewed interest can only increase the amount of attention and funding these concepts receive, in turn increasing the viability of VLFS designs and their underlying structural-engineering and energy-production concerns.

Another contemporary movement that will prove advantageous for our own concerns with the effects of overpopulation on living space, working space, and resource space is the growing green movement and sustainability movement. The problem of resource scarcity is already upon us in many areas, and there exists contemporary motivation for finding more resource-efficient ways of making energy and producing goods, and for lessening our dependency on non-renewable energy sources. Climate change has only become an increasingly predominant concern in international politics, and many incentives exist to lessen our dependence on non-renewable energy sources as well as to lessen the environmental impact of contemporary civilization, which is itself another oft-touted problematic concern possibly resulting from overpopulation. Developments in these areas are only set to continue, for reasons wholly unrelated to the effects of overpopulation, and when those effects come to the fore we will have a collection of existing methodologies that can then be harnessed to lessen the impact of overpopulation on living space and resource scarcity.

The predominance of these problems, as well as the amount of attention and funding they are expected to receive (and thus the viability of their potential solutions), will only increase as we move forward into the future. The solutions we have to the potential problems of overpopulation – namely resource scarcity and lack of living space – will not only increase as the effects of overpopulation get closer, but the technological and methodological infrastructures underlying those solutions will also become more tried, tested, and robust, fueled by contemporary concerns over decreasing living space, climate-change and resource scarcity.

While space colonization is the most frequently proffered technological solution to the possibility of future overpopulation, I think we will turn to various Earth-bound solutions to increasing humanity’s available living space, as well as the space available for agricultural labs, that is the manufacture of food-stuffs, or indoor farming systems [25, 26, 28], before colonizing the cosmos becomes an economically optimal option. I think these sorts of solutions will be employed long before humanity is forced to either regulate the birthrate or move into the cosmos.

Moreover, people who wish to have children will have incentive to support politicians running on policies promoting new solutions to decreasing living space. Consider the number of U.S. taxpayer dollars spent during the Space Race, with no immediate material or scientific benefit (other than to prove it could be done, as well as to maintain rough militaristic equality with the USSR to some extent, as the state of rocket technology was indicative of the state of ballistic technologies like missiles). If humanity is forced to choose between having children and receiving the medical treatments that will keep them from dying, surely people will be motivated to fund initiatives and projects aimed at solving the problems of decreasing living space and increasing resource constraints due to a growing global population.

It is important to remember that the largest increase in life expectancy we have experienced historically was followed by a drastic decrease in birthrate over the next few generations thereafter. Before the Industrial Revolution, English women had on average 6 children. In 2000 the average was less than 2.

Figure 1: Fertility Rates in England, 1540-2000

Note: GRR = Gross Reproduction Rate, NRR = Net Reproduction Rate
Source: Wrigley et al. (1997) p. 614. Office of National Statistics, United Kingdom.

The drop in birthrate following the industrial revolution has several causes. Chief among them is the fact that children were considered to some extent as assets, helping with maintaining the family livelihood, often by doing agricultural work on a family farm or helping with household chores (which were much more extensive then). Another large determining factor is a high rate of child mortality; thus families would have multiple children in anticipation of losing some to death. But with a rise in living conditions, the child mortality rate dropped drastically – and as a result we stopped having more kids in anticipation of some of them dying. Moreover, we started treating children less as assets and more as people to nurture and raise for their own sake. Longer lives, and less susceptibility to death in general, appears to have made us better parents.

Thus it is not only possible but probable that we will see a similar drop in the birthrate as a consequence of a significant future increase in average lifespan, with people having children much later in life, when they are more financially stable and when they have done all the commitment-free things they’ve always wanted to do. Without a looming limit on one’s available reproductive lifespan, there will be no pressing motivation to have children “before it’s too late” – and this alone could very well facilitate an unprecedented decrease in the Total Fertility Rate (TFR) of the global population.

Evidence indicates that the drop in birth rate was neither limited to England, nor an isolated result of the Industrial Revolution. A net drop in the TFR seems to be a longer-term trend concurrent across the globe. It is likely that the drop in the TFR is due to the same factors as the drop in birth rate following the Industrial Revolution – increasing life expectancy and continually improving living conditions allow people to have children without expecting a portion of them to be lost to death, to have them for the sake of having children rather than as assets to aid in maintaining the family livelihood, and to have children later in life due to the increase in one’s reproductive lifespan that comes with increasing life expectancy. The fact that the drop in TFR is not an isolated historical event is advantageous because the global population is affected by birth rate much more than by the mortality rate. Hence we may see a continuing decrease in the TFR occur in tandem with increasing life expectancy, leveling out the imbalance created by a mortality rate of zero by a larger than has been heretofore anticipated. (Source: U.S. Central Intelligence Agency, World Factbook.)

Let us suppose, for a moment, the worst: that indefinite longevity is achieved and we completely ignore (i.e., fail to plan for) overpopulation until its effects start becoming readily apparent. Even in this seeming worst-case scenario, overpopulation is not likely to result in any great tragedies. In such a case we would be forced to limit the global birthrate until we are able to implement the solutions that would allow us to sustainably procreate again. If people have a strong enough desire to continue having children, then they will express their demand and politicians will consequently base their policies upon deliberative initiatives to increase available living and agricultural space – and get elected if the desire to freely procreate is strong and widespread enough. Failing to plan for overpopulation will simply be a wake-up call, letting us know that we should have been planning for its effects from the beginning, and that we had better start planning for them now if we want to continue to freely procreate.

Thus while overpopulation is the most prominent and most credible criticism against continually increasing lifespans, and the one that needs to be planned for the most (because it will eventually happen, but it will lead to sustainability, resource, and living-space problems only if we do nothing about it), it is in no way insoluble, nor particularly pressing in terms of the time available to plan and implement solutions to shrinking living space and resource space (i.e., the space occupied by resources such as food, energy production, workplaces, etc.). We have a host of potential solutions today, ones we can use to increase available living space without regulating the global birthrate, and decades following the achievement of indefinite lifespans to consider the advantages and disadvantages of the various possible solutions, to develop them and to implement them.

So then: where to from here? Overpopulation is still the most prominent criticism raised against indefinite longevity, and if combated, the result could be an increase in public support for the Longevity movement. You might think that the widespread concern with overpopulation due to increasing longevity won’t really matter, if they turn out to be wrong, and overpopulation isn’t so insoluble a problem as one is inclined to first presume. But this misses a crucial point: that the time it takes to achieve longevity is determined by and large by how strongly and in how widespread a manner society and the members constituting it desire and demand it. If we can convince people today that overpopulation isn’t an insoluble problem, then continually increasing longevity might happen much sooner than otherwise. At the cost of 100,000 deaths due to age-correlated causes per day, I think hastening the arrival of indefinite longevity therapies by even a modest amount is somewhat imperative. Hastening its arrival by one month will save 3 million lives, and achieving it one year sooner than otherwise will save an astounding 36.5 Million real, human lives.

Thus, we should work toward putting more concrete numbers to these estimates. How much more living space can be feasibly created by colonizing the oceans? How deep can we really dig, build and live? How high can we safely build? Is there a threshold height or depth where building higher or deeper becomes too economically prohibitive to be worth the added living, working or resource space? What are the parameters (e.g., material strength/cost ratio, specific structural design) determining such a threshold?

First, we need to collect and analyze the feasibility studies that have already been undertaken on floating cities, artificial islands, VLFSs and the new solution-paradigms that are emerging to combat the contemporary concerns of sustainability and resource scarcity. In short, we need to compile data from the feasibility studies that have already been done, and the projects already implemented. Then we need to plan and commission further feasibility studies, undertaken by engineers and geologists, to build upon the work already accomplished in feasibility studies pertaining to existing designs for floating cities and other Very Large Floating Structures. We need to put some numbers to the cost the additional space for food, resources, work and living necessitated by widely available life-extension therapies. We need to do some hard calculations to show that the effects of overpopulation are problems that can be solved using existing megascale engineering and construction techniques and materials, safely and economically. We need to show the world that it has more space than it ever thought it had, and that such solution-paradigms as cosmic colonization and procreative regulation are neither the only ones, nor necessarily the most optimal ones. We need, in short, to show them that, in this case, where there’s a will there’s a way, and that the weight of waiting is too high a price to pay.

Franco Cortese is a futurist, author, editor, Affiliate Scholar at the Institute for Ethics & Emerging Technologies, Ambassador at The Seasteading Institute, Affiliate Researcher at ELPIs Foundation for Indefinite Lifespans, Fellow at Brighter Brains Institute, Advisor at the Lifeboat Foundation (Futurists Board Member and Life Extension Scientific Advisory Board Member), Director of the Canadian Longevity Alliance, Activist at the International Longevity Alliance, Canadian Ambassador at Longevity Intelligence Communications, an Administrator at MILE (Movement for Indefinite Life Extension), Columnist at LongeCity, Columnist at H+ Magazine, Executive Director of the Center for Transhumanity, Contributor to the Journal of Geoethical Nanotechnology, India Future Society, Serious Wonder, Immortal Life and The Rational Argumentator. Franco edited Longevitize!: Essays on the Science, Philosophy & Politics of Longevity, a compendium of 150+ essays from over 40 contributing authors.

References:

  1. Presidents Council for Bioethics: Transcripts (December 12, 2002): Session 2: Duration of Life: Is There a Biological Warranty Period? 01.
  2. L. A. Gavrilov and N.S. Gavrilova. “Demographic Consequences of Defeating Aging”. Rejuvenation Research. 2010 April; 13(2-3): 329–334.
  3. Ibid.
  4. McCullagh, Declan. “Seasteaders” Take First Step Toward Colonizing The Oceans.” CBS News, October 9, 2009. 02
  5. Pasternack, Alex. “Bioengineer aspires to colonize the sea.” CNN, January 12, 2011. 03
  6. Banham, Reyner. Megastructure: urban futures of the recent past. London: Thames and Hudson, 1976.
  7. Tsuchiyama, Ray. “Ocean Colonies as Next Frontier.” Forbes, April 24, 2011. Accessed August 1, 2013. 04
  8. “Inside Underground Cities.” Before Its News. 2013 March. 05
  9. South, D. B., and Freda Parker. “Underground Homes – Good or Bad?” Monolithic, January 22, 2009. 06.
  10. Good Earth Plants & Greenscaped Buildings. “Underground Living.” Last modified May 6, 2013. 07.
  11. Kelly, J. “10 Amazing Underground Cities”. Listverse.com. January 22, 2013. Accessed August 1, 2013. 08
  12. Gammon, Katharine. “Building Artificial Islands That Rise With Sea.” PopSci, June 8, 2012. 09
  13. Cottrell, Claire. “A Survey of Futuristic Floating Cities.” FlavorWire, November 2, 2012. 10
  14. “Cities on the Ocean.” Technology Quarterly – The Economist. Q4 2011.
  15. Bonsor, Kevin. “How the Floating Cities Will Work.” HowStuffWorks. n.d. 11.
  16. DigInfo TV. “GREEN FLOAT – a Floating City in the Sky.” Accessed August 6, 2013. 12.
  17. National Geographic. “Pictures: Floating Cities of the Future.” Accessed August 6, 2013. 13.
  18. Emerging Technology News. “Self-Sufficient Floating Cities Planned for 2025: Japan.” Accessed August 6, 2013. 14.
  19. “An artificial island in Hambantota.” News.LK, August 2, 2013. 15
  20. Goodier, Rob. “The World’s 18 Strangest Man Made Islands.” Popular Mechanics, n.d. 16
  21. E. Watanabe, C.M. Wang, T. Utsunomiya and T. Moan. “Very Large Floating Structures: Applications, Analysis and Design”. CORE Report No. 2004-02. Centre for Offshore Research and Engineering National University of Singapore. 17
  22. C.M. Wang, and Z. Tay. Very Large Floating Structures: Applications, Research and Development. In The Proceedings of the Twelfth East Asia-Pacific Conference on Structural Engineering and Construction — EASEC12. Edited by LAM Heung Fai. Singapore: Department of Civil Engineering, National University of Singapore Kent Ridge, 2011. 18
  23. World Architecture News. “Seasteading, United States.” Accessed August 6, 2013. 19
  24. The Seasteading Institute. The Seasteading Institute Annual Report 2008. Rep. n.p., n.d.
  25. Nagy, Attila. “14 High-Tech Farms Where Veggies Grow Indoors.” Gizmodo, June 17. 20.
  26. Meinhold, Bridgette. “Indoor Vertical Farm ‘Pinkhouses’ Grow Plants Faster With Less Energy.” Inhabitat. Last modified May 23, 2013. 21.
  27. TerraSphere. “Urban farming 2.0: No soil, no sun.” Accessed August 1, 2013. 22.
  28. The Vertical Farm Project – Agriculture for the 21st Century and Beyond. “Vertical Farm Designs.” Accessed August 6, 2013. 23

 

Radical Life Extension Won’t Cause Resource Shortages – Article by Reason

Radical Life Extension Won’t Cause Resource Shortages – Article by Reason

The New Renaissance Hat
Reason
October 6, 2013
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That overpopulation exists at all is one of the most prevalent delusions in the modern world: thanks to the environmentalist movement, a cause that has ascended near to the status of civic religion, the average fellow in the street thinks that there are too many people alive today, that resources are stretched to breaking point, that the future is one of Malthusian decline, and that horrible poverty in the third world is caused by the existence of too many people. All of these points are flat-out wrong. Humanity is wealthier and has greater access to resources today than at any time in history, the variety and amounts of available resources are growing at an accelerating pace due to technological progress, the earth could support many times more people than are alive today, and where there is poverty it exists due to terrible, predatory governance and the inhumanity of man – it exists due to waste and aggression amidst the potential for plenty.

Even this pro-longevity piece by George Dvorsky subscribes, as many do, to the false idea that somehow we are consuming too many resources and will run out. This is silly: resources are infinite, because through technological progress we constantly develop new ones. People live in an age of change, with each new decade clearly different from the last, and yet live under the assumption that everything will remain the same going forward. Being worried about running out of anything that we use today is like being worried about running out of candle wax in 1810, or running out of room for horse breeding operations in 1840, or running out of food in 1940. All false concerns, and all false for exactly the same reasons: we are not static consumers of resources, we are net producers of resources.

Quote:

Make no mistake, it’ll take us a long, long time to get there, but we’ll eventually find a way to halt the aging process. Owing to advanced medical, regenerative, and cybernetic technologies, future humans will enter into a state of “negligible senescence,” a condition marked by the cessation of aging and the onset of everlasting youth. It sounds utopian, but as biogerontologist Aubrey de Grey has repeatedly noted, it’s simply an engineering problem – one that’s not intractable.

I’ve been debating this issue for the better part of a decade, and I’ve heard virtually every argument there is to be said both in favor of and in condemnation of the possibility. I’m not going to go over all of them here. But without a doubt the single most prominent argument set against radical life extension is the issue of overpopulation and environmental sustainability.

As a final note, there’s a certain inevitability to radical life extension. It’s the logical conclusion to the medical sciences. So rather than futilely argue against it, we should come up with constructive solutions to ensure that it unfolds in the most non-disruptive way possible.

Link: http://io9.com/no-extreme-human-longevity-won-t-destroy-the-planet-1440148751

Reason is the founder of The Longevity Meme (now Fight Aging!). He saw the need for The Longevity Meme in late 2000, after spending a number of years searching for the most useful contribution he could make to the future of healthy life extension. When not advancing the Longevity Meme or Fight Aging!, Reason works as a technologist in a variety of industries.  

This work is reproduced here in accord with a Creative Commons Attribution license.  It was originally published on FightAging.org.

Illiberal Belief #9: It’s a Small World – Article by Bradley Doucet

Illiberal Belief #9: It’s a Small World – Article by Bradley Doucet

The New Renaissance Hat
Bradley Doucet
January 11, 2013
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We have only one planet, it’s true, and there are ever more of us crowding onto its surface. With six billion humans and counting, surely we must be running out of land—if not on which to live, then on which to grow the enormous amounts of food required to feed us all. As evidence, we are reminded of the large swaths of the planet mired in poverty, a tragedy that is used to justify any number of illiberal policies, from Maoist one-child population control laws to Stalinist food rationing meant to stretch out our meagre and dwindling resources.

Thankfully, these fears are unjustified. The advent and improvement of air travel and modern communications technologies have certainly made the planet seem smaller—we can zip to the Far East in a matter of hours, or send electronic documents anywhere in the world in a matter of seconds—but it’s still the same gigantic ball of rock it has always been. The Earth is really staggeringly large; too large, in fact, to grasp intuitively. Of course, six billion is also too large a number to grasp intuitively. Only mathematics can help us understand if we are truly running out of space.

Our planet has a surface area of approximately 510 million square kilometres, of which just under 30% (149 million sq. km) is land area. How many people can the Earth support? According to Scientific American, “With current farming techniques, a little less than half an acre can grow enough food to feed one person.” One square kilometre contains roughly 247 acres, and so can feed approximately 500 people. If all of the land on Earth were suitable for food production, our planet could therefore support a population of some 73.5 billion people (149 million times 500). Of course, not all land is suitable for agriculture, but thankfully we don’t need it to be. Our current population of six billion could be fed on just 12 million square kilometres of agricultural land, an area slightly larger than the United States. Even at nine billion people (the downwardly-revised population peak we are set to hit by 2050)(1), we would only need 18 million square kilometres, representing just 12% of the land on Earth, or an area about the size of Russia. Furthermore, this figure assumes unrealistically that no further improvements in farming techniques will be invented over the next five decades.

1. Although it is true that there are more of us than ever, the 2004 UN projections show that population growth is slowing and total population is on course to top out at around nine billion by mid-century, far fewer than previously thought.

Bradley Doucet is Le Quebecois Libré‘s English Editor. A writer living in Montreal, he has studied philosophy and economics, and is currently completing a novel on the pursuit of happiness. He also writes for The New Individualist, an Objectivist magazine published by The Atlas Society, and sings.
TANSTAAFL and Saving: Not the Whole Story – Article by Sanford Ikeda

TANSTAAFL and Saving: Not the Whole Story – Article by Sanford Ikeda

The New Renaissance Hat
Sanford Ikeda
October 3, 2012
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How often have you heard someone say, “There ain’t no such thing as a free lunch,” or, “Saving is the path to economic development”?  Many treat these statements as the alpha and omega of economic common sense.

The problem is they are myths.

Or, at least, popular half-truths.  And they aren’t your garden-variety myths because people who favor the free market tend to say them all the time.  I’ve said them myself, because they do contain more than a grain of truth.

“There ain’t no such thing as a free lunch” (or TANSTAAFL) means that, with a limited budget, choosing one thing means sacrificing something else.  Scarcity entails tradeoffs.  It also implies that efficiency means using any resource so that no other use will give a higher reward for the risk involved.

That saving is necessary for rising labor productivity and prosperity also contains an economic truth.  No less an authority than the great Austrian economist Ludwig von Mises has stated this many times.  In an article published in The Freeman in 1981, for example, he said:

The fact that the standard of living of the average American worker is incomparably more satisfactory than that of the average [Indian] worker, that in the United States hours of work are shorter and children sent to school and not to the factories, is not an achievement of the government and the laws of the country. It is the outcome of the fact that the capital invested per head of the employees is much greater than in India and that consequently the marginal productivity of labor is much higher.

The Catalyst

But the statement is true in much the same way that saying breathable air is necessary for economic development is true.  Saving and rising capital accumulation per head do accompany significant economic development, and if we expect it to continue, people need to keep doing those activities.  But they are not the source–the catalyst, if you will–of the prosperity most of the world has seen in the past 200 years.

What am I talking about?  Deirdre McCloskey tells us in her 2010 book, Bourgeois Dignity: Why Economics Can’t Explain the World:

Two centuries ago the world’s economy stood at the present level of Bangladesh. . . .  In 1800 the average human consumed and expected her children and grandchildren and great-grandchildren to go on consuming a mere $3 a day, give or take a dollar or two [in today’s dollars]. . . .

By contrast, if you live nowadays in a thoroughly bourgeois country such as Japan or France you probably spend about $100 a day.  One hundred dollars as against three: such is the magnitude of modern economic growth.

(Hans Rosling illustrates this brilliantly in this viral video.)

That is unprecedented, historic, even miraculous growth, especially when you consider that $3 (or less) a day per person has been the norm for most of human history.  What is the sine qua non of explosive economic development and accelerating material prosperity?  What was missing for millennia that prevented the unbelievable takeoff that began about 200 years ago?

A More Complete Story

Economics teaches us the importance of TANSTAAFL and capital investment.  Again, the trouble is they are not the whole truth.

As I’ve written before, however, there is such a thing as a free lunch, and I don’t want to repeat that argument in its entirety.  The basic idea is that what Israel M. Kirzner calls “the driving force of the market” is entrepreneurship.  Entrepreneurship goes beyond working within a budget–it’s the discovery of novel opportunities that increase the wealth and raises the budgets of everyone in society, much as the late Steve Jobs or Thomas Edison or Madam C.J. Walker (probably the first African-American millionaire) did.  Yes, those innovators needed saving and capital investment by someone–most innovators were debtors at first–but note: Those savings could have been and were invested in less productive investments before these guys came along.

As McCloskey, as well as Rosenberg and Birdzell, have argued, it isn’t saving, capital investment per se, and certainly not colonialism, income inequality, capitalist exploitation, or even hard work that is responsible for the tremendous rise in economic development, especially since 1800.

It is innovation.

And, McCloskey adds, it is crucially the ideas and words that we use to think and talk about the people who innovate–the chance takers, the rebels, the individualists, the game changers–and that reflect a respect for and acceptance of the very concept of progress.  Innovation blasts the doors off budget constraints and swamps current rates of savings.

Doom to the Old Ways

Innovation can also spell doom to the old ways of doing things and, in the short run at least, create hardship for the people wedded to them.  Not everyone unambiguously gains from innovation at first, but in time we all do, though not at the same rate.

So for McCloskey, “The leading ideas were two: that the liberty to hope was a good idea and that a faithful economic life should give dignity and even honor to ordinary people. . . .”

There’s a lot in this assertion that I’ll need to think through.  But I do accept the idea that innovation, however it arises, trumps efficiency and it trumps mere savings.  Innovation discovers free lunches; it dramatically reduces scarcity.

Indeed, innovation is perhaps what enables the market economy to stay ahead of, for the time being at least, the interventionist shackles that increasingly hamper it.  You want to regulate landline telephones?  I’ll invent the mobile phone!  You make mail delivery a legal monopoly?  I’ll invent email!  You want to impose fixed-rail transport on our cities?  I’ll invent the driverless car!

These aren’t myths. They’re reality.

Sanford Ikeda is an associate professor of economics at Purchase College, SUNY, and the author of The Dynamics of the Mixed Economy: Toward a Theory of Interventionism.

This article was published by The Foundation for Economic Education and may be freely distributed, subject to a Creative Commons Attribution United States License, which requires that credit be given to the author.

Ice and Economics – Article by David J. Hebert

Ice and Economics – Article by David J. Hebert

The New Renaissance Hat
David J. Hebert
July 21, 2012
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What can ice teach us about economics? We’ll see, but let’s begin with some fundamentals.

Prices, property rights, and profit (and loss) lead to information, incentives, and innovation. This simple statement contains nearly every lesson necessary for a free and prosperous society. But what do these words mean?

Prices convey information about relative scarcities and communicate to us the relative value of competing uses of a resource. They also economize on the acquisition of knowledge. When we see the price of a resource rise, market actors understand the need to use less of the resource. What they don’t know, however, is whether this rise is due to a disaster that destroyed some of the stock of that resource (an inward supply shift) or if a new, more valuable use for that resource has been discovered (an outward demand shift). These facts are irrelevant for a person who is currently using the resource, but from a societal level, her using less is necessary. If there is a disaster, we would want people to use less of it so that everyone else can still use some. If there is a new, more valuable use discovered, we would want the original users to use less so that more could be allocated towards this new use.

The Right to Exclude

Property rights refers not only to the right to use a resource, but also to the right to exclude others from its use. In this sense property rights provide the incentive to allocate the use of a resource efficiently across time, for example, to conserve it for later. With firmly established and enforced property rights, not only does the owner not have to worry about someone else taking his things but he also doesn’t have to rush out to gather the resources as quickly as he can. A situation where there are no property rights is susceptible to what is called the “tragedy of the commons,” where the resource gets depleted too quickly and never has a chance to replenish.

Profit (and loss) leads to innovation. Earning a profit is akin to being rewarded for doing something good. Suffering a loss is the opposite, a punishment for doing something wrong. In this case, the deed being done is the attempt to allocate scarce resources to where their will earn their highest return. People who successfully do this are rewarded with monetary gain, which we call “profit.” People who fail to do this experience what we call “loss.” In doing so, economic actors learn what works and what does not. Reducing the profitability of an activity through taxes or legislation or sheltering people from losses, therefore, acts to retard this learning process and stifles innovation.

This lesson is exemplified in early nineteenth-century Boston with the rise of the American natural ice trade. In 1806 Frederic Tudor sailed a ship full of ice from Boston to the Bahamas. Two years earlier Tudor had begun experimenting with insulation with the goal of bringing ice to the Bahamas.  When he was ready to set sail, he found that the ship captains refused to carry his cargo for fear of damaging their vessels. So he bought his own brig, the Favorite, and set sail February 10, 1806. He arrived in Martinique with a large quantity of ice still intact and began selling. The Bahamians loved the ice, which they had never seen before. Yet that first year Tudor lost a substantial sum of money, although he proved that ice could be shipped to the Bahamas. Now the objective became doing it at a profit.  Convinced his idea would be wildly successful, he continued his attempts to drive down costs and increase demand.

Higher Return

Meanwhile, as the price of the ice on the ponds rose, the people of Boston gained the information that the ice would bring a higher return in the Bahamas, thus they used less themselves and sold the ice to the Bahamians. In 1840 the ponds in the Boston area were explicitly divided, giving each person on the lake the right to exclude everyone else from harvesting any ice that wasn’t theirs. This allowed Tudor, for example, to invest in his ice and let it freeze longer so that it could better survive the long journey from Boston to India, which entailed crossing the equator twice and sailing around the tip of Africa. As Tudor earned profit from his venture, more people were attracted to the ice.

To continue to earn a profit, therefore, he had to find a way to outcompete everyone else. In 1825 Tudor enlisted the help of Nathaniel Wyeth, one of his suppliers. Tudor noticed that Wyeth’s ice was always significantly cheaper than everyone else’s and was cut in neater blocks which packed more easily. Wyeth had converted some old farm plows into ice-cutting plows and had fastened horseshoes with spikes to allow horses to pull these modified plows across the ice. By scoring the ice in such a fashion, Wyeth could break uniform sized blocks much quicker than his competitors, who were using hand saws that produced very rough and uneven edges.

These wouldn’t be the only contributions of Wyeth, as he went on to invent many other cost saving techniques. For example, Wyeth developed a conveyor-belt system that would haul the ice from the pond into the waiting icehouse.  He also invented bigger plows that could cut more blocks at once and poles that were used to guide the floating ice blocks onto the conveyor belt;  refined the above-ground icehouse, which allowed ice to be stored anywhere in the world for months on end without any external source of refrigeration.

New Insulation

Tudor and Wyeth also experimented with new means of insulating the ice from the heat, discovering that sawdust was not only a fantastic insulator but was also cheaply available from the sawmills around Boston. They also taught their customers new ways to use the ice, including making ice cream and storing the ice in iceboxes to preserve foods longer.

In short the three Ps lead to the three Is: Prices, property rights, and profit (and loss) lead to information, incentives, and innovation.  With these firmly in place, a free and prosperous society will follow.

David Hebert is a Ph.D. Fellow at the Mercatus Center at George Mason University.

This article was originally published by The Foundation for Economic Education.

Property Rights Aren’t Always the Libertarian Solution – Article by Sanford Ikeda

Property Rights Aren’t Always the Libertarian Solution – Article by Sanford Ikeda

The New Renaissance Hat
Sanford Ikeda
July 15, 2012
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At FEE’s seminar last week on libertarian perspectives on current events, a participant asked: “How do we privatize the air?”

The student may have had in mind the economic principle, popularized by Ronald Coase, that externalities–especially negative externalities such as air pollution– result from ill-defined or unenforced property rights. The question also seems to reflect a common libertarian idea that in a free society all scarce resources must be owned by somebody. That would include the atmosphere when clean air is scarce.

Property Rights and Economic Development

The Coase Theorem is an economic proposition which says that when property rights are well defined and enforced, and the costs of search, bargaining, and enforcement are reasonably low, voluntary trade will tend to produce results that are economically efficient. Negative externalities will be internalized, as unowned resources are transformed into marketable goods. And if, because of incomplete property rights, entrepreneurs are unable to capture enough of the benefits from their actions (that is, if positive externalities would result), they will be less inclined to make the discoveries that drive economic development. Those benefits would be internalized, too.

There are some positive externalities that most, perhaps all, of those who favor tough property enforcement would hesitate to try to privatize. For example, cultures develop in part on the basis of imitation. Jazz musicians copy from one another all the time, from motifs to entire songs, and reinterpret them in their own creations. Classical musicians have also done this. As a courtesy, the protocol is to name the artist from whom you are copying, such as in “Variations on a Theme of Paganini.”

On an even higher level of abstraction, artists, writers, and even ordinary people partake in an esthetic ethos; scholars, intellectuals, and laymen draw on the intellectual milieu of a place and time. Without the experimentation that comes from such borrowing and give-and-take, cultures would stop evolving; they would die.

The same thing goes for economic development. One entrepreneur discovers a demand for flat-screen televisions and is soon followed by imitators, which in the long run results in lower prices and better quality–and often new products and uses, such as tablet computers.

Don’t get me wrong! Private property rights prevent the kind of free riding that hinders economic development. And of course private property is essential for personal freedom: Property rights not only help to avoid or resolve interpersonal conflict–such as the tragedy of the commons–they are what provide a person with a sphere of autonomy and privacy in an economically developed world where contact with strangers is commonplace.

Elinor Ostrom on the Establishment of Conventions

There are many instances where free riding is a net negative, and the overuse of the atmosphere in the form of air pollution is probably one of them. Despite the efforts of some economists, legislators, and policymakers to institute so-called “cap-and-trade”–which would attempt to establish property rights in the air through government policy–it may be impossible to do something similar for all scarce resources, either by legal mandate or market arrangements. But this need not discourage libertarians, of either the minimal-state or market-anarchist variety.

Consider the work of Elinor Ostrom, winner of the 2009 Nobel Prize in economics, the only women so far to be so honored. Sadly, Ostrom died on June 12, a great loss for social science. While few would consider her a libertarian–I don’t believe she thought she was–libertarians can learn a lot from her work. She is perhaps best known for her 1990 book, Governing the Commons, in which she presented her methods and findings regarding how people coped (or didn’t cope) with what has come to be known as “common-pool resource” (CPR) problems:

What one can observe in the world, however, is that neither the state nor the market is uniformly successful in enabling individuals to sustain long-term, productive use of natural resource systems. Further, communities of individuals have relied on institutions resembling neither the state nor the market to govern some resource systems with reasonable degrees of success over long periods of time.

Voluntary Conventions

In those instances the nonstate, nonmarket institutions she studied were, when successful, conventions that the users of common-pool resources agreed to and used sometimes for centuries. They were made voluntarily and evolved over time, but they were not market outcomes, at least in the narrow sense, because no one “owned” the resource in question and it was not bought and sold. Ostrom added:

The central question of this study is how a group of principals who are in an independent situation can organize and govern themselves to obtain continuing joint benefits when all face temptations to free-ride, shirk, or otherwise act opportunistically.

Her research covered the harvesting of forests in thirteenth-century Switzerland and sixteenth-century Japan and irrigation institutions in various regions of fifteenth-century Spain. Although not every community Ostrom studied was successful in establishing such conventions, it is instructive how highly complex agreements, enforced by both local norms and effective monitoring, were able to overcome the free-rider problems that standard economic theory–and perhaps vulgar libertarianism–would predict are insurmountable without property rights.

Dealing with air pollution is of course a more difficult problem since it typically entails a much larger population and more diffuse sources and consequences. But it’s important to realize that a “libertarian solution” to air pollution may not necessarily be a “market solution.”

Sanford Ikeda is an associate professor of economics at Purchase College, SUNY, and the author of The Dynamics of the Mixed Economy: Toward a Theory of Interventionism.

This article was published by The Foundation for Economic Education and may be freely distributed, subject to a Creative Commons Attribution United States License, which requires that credit be given to the author.