Investing In a Resource – Constrained World (Part V)

Unlike most Peak Oil advocators who are extremely pessimistic, I am an optimist. I was pessimistic the first time I learned the Peak Oil concept. But the knowledge of the Malthus Theory actually turned me into an optimist. Humanity has faced many many crises before, each of which could have wiped out humanity from the surface of the earth, but we survived for millions of years nevertheless. So the looming resource crisis is no different and probably no worse than any of the previous crises humanity has faced.
Let me explain Malthusian in simple terms. A fish in the ocean, for example, can lay a few million eggs at a time. Each egg, given the proper opportunity, can grow into an adult fish and it can lay a few million eggs of its own. If you multiply a million by a million and keep multiplying, pretty soon you reach an astronomical number that total number of fish can easily fill the whole ocean, or fill up the whole galaxy. Of course that could never happen. Most eggs got eaten by other fish as food, before or after they are hatched.

A pessimist would think that what if all one million eggs are eaten and not even one survives to grow up? Then the fish could become extinct pretty fast. That does not happen either. It just so happens that out of 1,000,000 eggs, 999,999 will not survive but on average exactly one will survive to lay eggs, no more and no less. Nature has a way of regulating the fish population based on available natural resources like food and habitat.

The Malthus Catastrophe happens on a daily basis for fish. But I do not see any fish being pessimistic. They have been living happily for millions of years and just keep laying as many eggs as they can. Life goes on. Shouldn’t human society, with our collective intelligence, cope with our own Malthus Catastrophe better than fish?

The unfolding energy and natural resource crises, in my opinion, is a population crisis. The global population simply exceeds what the earth’s natural resources can support. If we have one billion people instead of six billion, then we still have plenty of oil and other natural resources left for everyone to consume. There are ways to cope with it, peaceful ways, through conscious population control (like the family planning policy in China), and conscious reduction of consumption.

Seeking Alpha