Peak Oil is You
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Page added on March 22, 2018
The End of Scarcity
Doomsdayers fret as world population grows, yet human productivity increases all the while and resources remain abundant.
It is often posited that population growth must inevitably result in the exhaustion of natural resources, environmental destruction, and even mass starvation. Only last month, a much-discussed study in the journal Nature Sustainability insisted that “Humanity faces the challenge of how to achieve a high quality of life for over 7 billion people without destabilizing critical planetary processes.”
We have seen this before.
“The Limits to Growth,” which was published by the Club of Rome in 1972, looked at the interplay between industrial development, population growth, malnutrition, the availability of nonrenewable resources, and the quality of the environment. It concluded that “If present growth trends in world population, industrialization, pollution, food production, and resource depletion continue unchanged… [t]he most probable result will be a rather sudden and uncontrollable decline in both population and industrial capacity.”
That was 46 years ago. Let’s see how such a prediction panned out, and let’s go one step further by broadening the period studied. Looking at changes in population, commodity prices, and income from 1960 to 2016, world population increased by 145 percent, from 3 billion to almost 7.5 billion. Yet inflation adjusted gross domestic product (GDP) per person increased by 182 percent, from $3,689 to $10,391. Income, in other words, grew 26 percent faster than population.
What about natural resources? After all, as people grow richer, they consume more stuff. Consider the evolution of prices of 42 natural resources, as tracked by the World Bank from 1960 to 2016. Adjusted for inflation, 19 declined in price, while 23 increased in price. But only three (crude oil, gold, and silver) appreciated more than GDP per person. Put differently, GDP per person grew faster than 92 percent of the commodities measured.
Adjusting prices for inflation is important, but adjusting for changes in income is even more so. Time is humanity’s most precious resource, and comparing prices and income is what really counts. Are people spending less time to acquire more things? After adjusting for the increase in GDP per person, commodity prices fell by an average of 53 percent. Humanity is creating faster than it is consuming.
In spite of the Great Recession and the gloomy disposition of many of our fellow Americans, the United States of America has done well over the last 56 years. Our GDP per person grew from $17,036 to $52,194 — an increase of 206.3 percent. That’s 13.6 percent faster than the global average.
So what about gold, with a value which rose by 123.6 percent, silver, which rose by 18.6 percent, and oil, which rose by 65.9 percent?
Historically speaking, the oil market was partly shielded from competitive forces by OPEC cartel. OPEC nations frequently colluded to restrict production in order to keep its price artificially high. The extent to which OPEC was able to achieve its goal in the past is subject to much debate, but many experts have come to believe that OPEC’s ability to affect the future price of oil is weakening. That’s partly because of horizontal fracking of previously inaccessible oil reserves in non-OPEC countries, such as the United States, and partly because of technological developments, such as the accelerating move away from combustion engine vehicles.
Gold and silver are, in addition to their commercial uses, also “stores of value” or assets that can be saved, retrieved, and exchanged at a later time. Historically, people of all income groups used gold and silver to hide their wealth from rapacious government officials and in the time of war. More recently, both metals rose in price during the inflationary 1970s, when many of the world’s most important currencies, including the U.S. dollar, were rapidly losing their value because of monetary mismanagement. They spiked again after the outbreak of the Great Recession and the subsequent uncertainty about the soundness of the financial system.
The most important thing to remember is that none of the commodity prices increased faster than the population rate of growth. The relationship between prices and income is the key to understanding what is happening, with change in this ratio over time serving as how we really see the growth in human prosperity.
Where will prices of commodities be 56 years hence? As long as humans can avoid war and are free to create and test their ideas, life will continue to improve — perhaps at an even faster rate. More people, more ideas, more innovations, more value created.
Marian L. Tupy is a senior policy analyst at the Cato Institute’s Center for Global Liberty and Prosperity and editor of www.humanprogress.org.
77 Comments on "The End of Scarcity"
MASTERMIND on Thu, 22nd Mar 2018 5:59 pm
The shelter line stretchin’ around the corner
Welcome to the New World Order.Families sleepin’ in their cars out in the Southwest
No job, no home, no peace, no rest, NO REST!
MASTERMIND on Thu, 22nd Mar 2018 6:02 pm
Clog whenever ya see a cop beatin’ a guy,
Wherever a hungry new born baby cries,
Whereever there’s a fight against the blood and hatred in the air.
Look for me Clog’
I’ll be there
Wherever somebodies stuglin’ for a place to stand, For a decent job or a helpin’ hand
Wherever somebody is strugglin’ to be free
Look in their eyes Clog,
You’ll see me! You’ll see me!
MASTERMIND on Thu, 22nd Mar 2018 6:10 pm
Buffett to Berkshire Shareholders: Be Prepared to Lose Half Your Money
https://finance.yahoo.com/news/buffett-berkshire-shareholders-prepared-lose-133100821.html
Harquebus on Thu, 22nd Mar 2018 6:12 pm
“there is an uncomfortable scientific truth that has to be faced: Economic growth is environmentally unsustainable.”
“Increase in GDP leads to increase in material and energy use, and therefore to environmental unsustainability.”
https://metamag.org/2018/02/21/opinion-economic-growth-is-not-compatible-with-environmental-sustainability/
“Worldwide, we’re subsidising an illusory present by cannibalising an already-uncertain future. We’re doing this by creating debt that we can’t repay, and by making ourselves pension promises that we can’t honour. So acute is this problem that our chances of getting to 2030 without some kind of financial crash are becoming almost vanishingly small.”
“if we continue with the myth of perpetual growth, we’re not only making things worse, but we may be throwing away our capability to adapt.”
“We seem incapable of thinking or planning in any terms that aren’t predicated on perpetual growth. We resort to self-delusion instead.”
“We seem oblivious of the obvious, which is that money, having no intrinsic worth, commands value only as a claim on the output of a real economy driven by energy.”
https://surplusenergyeconomics.wordpress.com/2018/02/23/120-the-need-for-new-ideas/
“Economics is practiced in the United States as a social science. When I first looked into economics I was astonished that it’s not consistent with the law of conservation of energy nor the second law of thermodynamics nor the laws of conservation of mass. All of those things do not enter into the basic economic models. In fact, the basic economic models, as far as I’m concerned, just make no sense if you have a background in the natural sciences(…)”
https://www.peakprosperity.com/podcast/113808/dr-charles-hall-laws-nature-trump-economics
https://whistlinginthewind.org/2014/08/09/why-economics-is-not-a-science/
“We’re rapidly depleting resources, degrading ecosystems, altering the atmosphere, etc. What earth scientists are saying is generally not covered by the mainstream media, or is sugar coated, because the mainstream media is an outlet for the corporate perspective on the world.”
http://www.resilience.org/stories/2018-03-12/the-world-oil-supply-is-infinite-i-know-that-because-i-believe-it/
http://theaimn.com/depopulate-or-perish/
“The trouble is climate scientists don’t understand economic policy.” — Judith Sloan, ABC’s Q&A 2017/11/13
MASTERMIND on Thu, 22nd Mar 2018 6:46 pm
Harquebus
Without growth the economy goes into a deflationary downward spiral and collapses. We have no choice unless we just want to collapse the system on our own. And if the system is going to collapse on its own anyways might as well keep the party going as long as possible.
Anonymouse1 on Thu, 22nd Mar 2018 6:55 pm
Spam harder, exceptionlist.
JuanP on Thu, 22nd Mar 2018 7:22 pm
SLAVEMIND “Since you have no articles or arguments to prove your intelligence.”
You would have to be incredibly stupid to believe that copying and pasting some old links that everyone here read years ago and writing a couple of incoherent, illiterate sentences proves you are intelligent. But that is normal; usually, the less intelligent a person is the more intelligent they think they are. And, the more ignorant a person is the better educated they think they are. Nanomind is a perfect example of this! LOL! He is simply to stupid to understand how stupid he is!
Antius on Thu, 22nd Mar 2018 7:22 pm
” Just do a google search for Solar power bankrupt!”
Just did the Google search. There aren’t many solar panel manufacturers left in the western world that aren’t bankrupt. Most of the recent price declines result from Chinese state owned companies dumping these things on western markets beneath cost, as China itself pushes the biggest nuclear expansion in history. The writing is on the wall.
MASTERMIND on Thu, 22nd Mar 2018 7:27 pm
Overpopulation has become so extreme that someday soon the only way to survive will be eating our babies…
MASTERMIND on Thu, 22nd Mar 2018 7:31 pm
Juanp
what old links?
https://imgur.com/a/OB1w6
Dont worry I have a fresh article coming from Forbes tomw morning that I helped the author write. You will see some of my links in the mainstream! Let that be a lesson to you Juanp. If you challenge MM he doesn’t back down, he doubles down and goes mainstream! To bad you dont have any sources just insults and slander like whiny little bitch does! All talk no action!
MASTERMIND on Thu, 22nd Mar 2018 7:33 pm
What do you call JuanP fighting a priest?
Alien vs Predator!
MASTERMIND on Thu, 22nd Mar 2018 7:35 pm
What is JuanP favorite sport?
Cross country! LOL
MASTERMIND on Thu, 22nd Mar 2018 7:36 pm
Why do Hispanics like Juanp have small steering wheels?
So they can drive with handcuffs on!
MASTERMIND on Thu, 22nd Mar 2018 7:37 pm
What do you call a building full of Hispanics like Juanp?
Jail
MASTERMIND on Thu, 22nd Mar 2018 7:38 pm
Why do low IQ Hispanics like JuanP put their names on their cars?
So they won’t steal them!
MASTERMIND on Thu, 22nd Mar 2018 7:39 pm
What do migrants like Juanp and vending machines have in common?
They both take your money and don’t work..
Survival Acres on Thu, 22nd Mar 2018 7:51 pm
What a disgusting propaganda piece of the worst kind.
The “price” of commodities does not represent anything but market prices – this does not represent the environmental destruction or the depletion levels accurately, because the efficiencies of resource extraction have vastly improved, while leaving behind a virtual wasteland. Go examine the ocean floor or a palm oil plantation or open pit mine for your evidence.
Championing the GDP or even the income does no good either – because both metrics fail to account for actual resource depletion and destruction. Celebrating these is akin to “winner take all” attitude despite there being no reward at the end of this race to the bottom.
Communities all over the world are experiencing natural resource destruction and impoverishment and mega-corporations destroy what little still remains. Sure, their profits and production and income has increased – but at what terrible costs to everyone else, including the future children of this planet?
“Time is humanity’s most precious resource”. “comparing prices and income is what really counts” – What the fuck? Pure unadulterated bullshit. A habitable PLANET is humanity’s “most precious resource”. How much time we have here is DIRECTLY related to how we treat this place.
I’d like to strangle the f’n idiot that wrote this propaganda piece. Pure written crap.
And the unadulterated garbage mentions about gold and silver are more carrots designed to reel in the gullible into buying something they will never, ever need while hoping they’re get rich from the ‘investment’.
Someone tell me – why does Peakoil.com even publish such complete garbage? Propaganda like this needs to be circular filed where it belongs.
Survival Acres on Thu, 22nd Mar 2018 7:55 pm
Harquebus – good to see your still at it. It does feel like we’re beating at the wind, but only because we aren’t allowed into the offices of these planet raping bastards where we can choke the life out of them on their plush carpeted floors.
Sissyfuss on Thu, 22nd Mar 2018 9:00 pm
SA, I believe that the proprietors of this site post such drivel to get the natives restless. Tell me it didn’t work on you.
Anonymouse1 on Thu, 22nd Mar 2018 9:57 pm
Look at the source, the CaTO institute. There is no reason anyone should be suprised by either its tone, or content.
JuanP on Thu, 22nd Mar 2018 9:59 pm
SLAVEMIND, I think your last working neuron just short circuited. Thanks for the laughs! I look forward to interacting with you again tomorrow! LOL!
Cloggie on Thu, 22nd Mar 2018 10:26 pm
“What do you call a building full of Hispanics like Juanp?”
What do you call a building full of financial swindlers?
Right, a synagogue.
Anonymouse1 on Thu, 22nd Mar 2018 10:36 pm
Well, if anyone would know all about synagogues full of swindlers, it would be you cloggraham.
Davy on Fri, 23rd Mar 2018 5:47 am
“The Hydrogen-Powered Car’s Big Setback”
https://tinyurl.com/yaufpn2e
https://tinyurl.com/ybd9devs
“But the dirty little secret about clean cars is that a decade after Tesla Inc. left hydrogen technology in the dust by putting its first all-electric sedan on the road, automobile executives still think cars that emit only water are the way of the future.”
“Of the almost 1,000 officials polled by the Dutch advisory, some 78 percent said hydrogen cars will prevail because their tanks can be filled in minutes, making recharging times of 25-45 minutes for battery options “seem unreasonable.” Elon Musk famously dismissed fuel cells as “mind-bogglingly stupid” You wouldn’t guess it by looking on the roads or in auto showrooms today. Just compare BMW’s one fuel-cell car to its plans for 10 battery-powered models by 2022 and you can get a sense of how far behind hydrogen has fallen.”
“If you want to have a million electric vehicles on the road, fuel cells are going to have to be a part of it,” said Andreas Broecker, head of innovation at Linde. “The public still doesn’t really know that fuel-cell technology is part of electromobility. That should be made clearer.”
DerHundistlos on Fri, 23rd Mar 2018 6:07 pm
@ MM, “Paul Ehrilich has been screaming Apocalypse for forty years. The Population bomb even has like form letters in it to send to your congressman (as I recall).”
Call me obtuse, but what’s your point? You have been screaming apocalypse by oil since joining this forum. The difference is Ehrlich’s collapse analysis incorporates a wide spectrum of environmental doomsday bombs in the making.
MASTERMIND on Fri, 23rd Mar 2018 6:23 pm
DerHundistlos
I have said the same thing over and over again. I think the collapse will happen within the next decade based on the limits to growth study. Nice straw man though!
https://imgur.com/a/OB1w6
MASTERMIND on Fri, 23rd Mar 2018 6:24 pm
Soon in the future people will be forced to eat their babies to stay alive!