BBC Questions Indefinite Growth

Theo Leggett of the BBC interviewed me in late January as part of a program asking: “Can the World Get Richer Forever?”  You can listen to the show here.  My part begins about eleven minutes in.

I was also asked to contribute some short text for the write-up (same as first link above), but apparently Theo was unable to get contributions from all participants, so wrote the piece himself.  But here is what I sent him.  I was asked to answer the question:

Can the World Get Richer Forever?

Shame on you for even asking.  Of course not.  At present population levels, we are putting unprecedented pressure on finite resources.  We are conducting a grand-scale, unauthorized experiment on the 4.5 billion-year-old planet.  The fact that we have not hit the bounds in a few generations of outrageous growth should not be taken as evidence for our long-haul prospects.  We live like kings today, on the backs of roughly 100 energy slaves each (human metabolism is 100 Watts, but Americans enjoy 10,000 W of continuous power).  Our richness is very much tied to surplus energy availability, and that so far has been a story of finite fossil fuels.  But even under solar power, we can’t continue our track record of 3% energy growth per year for even several hundred years!  Global physical limits—thermodynamic, energy return on energy invested, finite arable land, water, fisheries, climate change, etc.—are all asserting themselves to remind us that nature doesn’t care about our dreams.  The other point to make is that even if we capped physical growth due to finite resources, we cannot expect to continue getting richer indefinitely.  This would necessarily take the form of non-physical exchanges of utility/worth, but to keep growing these activities would have to eventually utterly dominate the economy—rendering the finite and essential resources effectively free.  And tell me how that makes sense.


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34 thoughts on “BBC Questions Indefinite Growth

  1. I tend to think these arguments are persuasive, yet I also very much tend to defer economics issues to Paul Krugman, who, if I’m not mistaken, heaps scorn on the idea (or at least a similar idea). It would be wonderful if you had the time and inclination to address his specific points (or state blankly that what he opposes, and what you say are not one and the same argument).


    • I’m sure Tom could do a better job of this than I can but please allow me to take a swing at showing a couple of places where Mr. Krugman goes off the rails with his shipping example.

      1. The graph shows fuel consumption per day on the y axis so, of course, going slower reduces the fuel consumption per day. I can make a case for “ultra slow steaming”. Just put a sail on the cargo ship, turn off the engines, and sit back and relax while the y axis drops to zero. The y axis should have been fuel consumption per 1000 km or something like that.

      2. The example of slow shipping puts arbitrary limits on what we examine. In this case we are looking at fuel, ships, and men. But Krugman ignores the increased cost of extracting and refining the steel to make the additional ships, the cost of training and feeding the additional crews to run the additional ships, the extra cost of maintaining those extra ships, extra insurance, additional ship yards required to build the ships, registration, legal fees, etc, etc. An appropriate analysis would show the global impact (on all resources and systems) of the ‘slow steam’ decision. By just looking at a couple convenient factors Mr. Krugman has effectively put his finger on the scale to bolster his position.

      3. But if let those significant errors in his analysis go and take him at his word, he is basically arguing that efficiency coupled with substitution will allow us to grow forever. This isn’t a tenable position for so many reasons. Many of them are covered by Tom on this blog but also by others such as Vaclav Smil in his book Making the Modern World, in which he demonstrates that while we are using less resources per widget created, we are making so many more widgets that our total resource consumption just keeps rising. In other words, efficiency isn’t reducing absolute total consumption.

      You can see this how this will play out with the increased fuel efficiency of cars in the US. It’s great, we should definitely do it but there’s no chance the total global demand for transportation fuels is going to go down if China and India develop comparable auto fleets and driving habits.

      So the second part of Mr. Krugman’s argument is that ‘energy’ is nothing special and we can just use substitutes. Okay. So let’s say oil becomes to expensive to use as a fuel for shipping. Okay, so maybe we investigate nuclear ships. But when we look at that, we find it’s crazy expensive to build, run, and maintain a nuclear shipping fleet. Plus, we’d need to dramatically increase our uranium production capabilities. Okay, what about going back to steamers with coal fired boilers? We’ll coal is dirty and not nearly as energy dense as oil so we’ll need a lot of it on each ship (with less cargo capacity per ship) and have to just accept that it’ll pollute the atmosphere more than oil. Fueling the coal-powered ships is also slower than oil-powered ships. So I think we’ll definitely need to increase the size of the fleet substantially to compensate for the shortcomings of coal. Did I mention that the entire existing fleet would need to be retrofitted or replaced? I suppose we could turn coal into oil and use that to power the existing ships but there is very little existing capacity and even China is backing away from its plans to develop plants to make that conversion. So coal powered ships aren’t looking to good either. Want to talk about sailing ships? How about row boats? No. We just oil because it is an extremely good source of energy. There isn’t anything else on the planet like it and if it should be come scarce or very expensive, we will find many–if not all–of the substitutes to be inferior (especially in the transportation sector).

      In summary, Mr Krugman is wrong.

      • @bosepchuk
        > the cost of training and feeding the additional crews to run the additional ships

        Container ships are getting rid of their crews:

        “Sep 8, 2014 – By 2035 the world’s cargo will be carried by 200m fully automated vessels operating entirely without an onboard human crew, according to …”

      • Hi bosepchuk,

        “Krugman ignores the increased cost of extracting and refining the steel to make the additional ships, the cost of training and feeding the additional crews to run the additional ships, the extra cost of maintaining those extra ships, extra insurance…”

        Those things are fairly negligible. Just doing a back-of-the-envelope calculation here, those things add up to a few percent of the fuel costs of the ship. The added energy cost for building more ships is about 0.5% the energy cost of propelling the ships. Crew feeding requirements are also fairly negligible. I would guess that all the factors you mentioned would add up to a few percent, so they don’t substantively change what Krugman was saying.

        (A containership burns ~40,000 gallons of bunker fuel per day which is ~6 million MJ, or (*30*365) 68 billion MJ over the lifetime of the ship. The same ship weighs 55,000 tonnes, at 20,000 MJ per tonne of steel which is 1100 million MJ. As a result, the energy cost of building the ship is about 1.6% (1100/68000) of the energy cost of propelling it during its lifetime. If the “slow steaming” ship is traveling at 66% of the speed of the faster ship, then the added energy cost of building more ships for slow steaming is 0.5%. That’s a rough estimate, because I’m ignoring time spent at port, energy spent on welding and on shipyards, etc, and I’m assuming that none of the ship is built using recycled steel which uses far less energy (ships are scrapped and recycled at the end of their lives), etc.)

        Also, there are other opportunities for fuel savings which Krugman didn’t mention. Shipping companies can save fuel by using larger ships, not just slower ones. A ship which is 4x larger burns half the fuel per tonne-mile. Larger ships use LESS steel and require LESS crew per unit of cargo. Of course, we have to widen the Panama and Suez canals, and dredge port channels, and that takes energy, but the canals will last for centuries.

        -Tom S

    • “Energy is just an input like other inputs” is a notable piece of Krugman’s piece there. But it’s not: it’s _the_ input. Without energy for food production, water delivery, shelter production, and clothing production, there is no labor. Without energy to make capital assets, there are no capital assets.

      Krugman’s general point though is that there’s no particular reason we can’t get more energy-efficient at providing those things, and I don’t see anyone disagreeing with that.

      That contrasts with the point made in the BBC article, that there are fundamental physical limits to how much energy you can use on planet Earth: the goods we make are at the end of the day embodiments of the energy used to create them and the entropy added to the universe in the process. So we can only make steel girders from iron ore at such and such a rate before thermodynamics steps in and says that if we make it any faster the oceans will have to boil.

      As long as GDP is connected to energy (and even information is in the physical sense) then there are hard physical limits to it. Owing to the nature of the exponential function we run into these limits in less than the blink of a geological eye.

    • “I also very much tend to defer [on] economics issues to Paul Krugman”

      As do many others; and since he calls himself a liberal, he helps prevent liberals and progressives from seeing the physical reality underlying socioeconomic issues. The man is a menace.

      One can only groan at “hard scientists who think they are smarter than economists” and at “But you can still carry as much freight as before, simply by using more ships — that is, by supplying more labor and capital.”; with the afterthought of “It’s not a free lunch — it requires more of other inputs — but that’s just ordinary economics.” Yes, quite.

      A serious study is needed into the effects on the human brain of studying and practicing economics. There could be a Nobel Prize in Physiology or Medicine in it for someone – a real Nobel, unlike the ersatz “Nobel Memorial Prize in Economic Sciences” held by Krugman.

  2. I don’t think your final point makes sense: “non-physical exchanges of utility/worth, but to keep growing these activities would have to eventually utterly dominate the economy—rendering the finite and essential resources effectively free.”

    If non-physical exchanges of value (presumably information exchanges) came to utterly dominate the economy, the relative price of finite and essential resources could become extremely large. Think of a two good economy that is subject to an increase in supply of only one good. Under fairly common restrictions, the price of the good in increased supply falls, and the price of the good with no increase in supply rises. Everyone is richer, but only their consumption of the more abundant good has risen.

    • In your scenario, the limited good anchors the economy (which is realistic). The price of the fixed good actually goes up, so that you have less disposable income for the frivolous stuff (but it’s cheaper so maybe you get the same amount?). In any case your scenario would seem to prevent runaway (indefinite, continued) economic growth.

      If, on the other hand, you wanted to maintain an economic growth rate (more dollars spent each year, for instance), then the growth must be in the non-resource-limited sector, and its share of the economy (dollars spent) would grow relative to the limited sector. One year you pay 50% of your income on resource-based goods, the next year 47%, etc. until in the limit you are paying a very small fraction of your income on limited resources (essentially free). Of course this doesn’t make sense. Neither does continued economic growth in the face of finite resources that occupy a finite (if not increasing) fraction of the total economy.

      • No. Suppose initial “quantity of information exchanged” has exchange value of 100 units, and the real quantity is growing at 5% per year. Suppose “physical goods produced” have exchange value of 100 and they’re not growing. Suppose the (fiat) money supply grows at 2% per year.

        The representative consumer in this economy has income = 200 which grows at 2% per year. The path of prices for each good is dependent upon preferences, but the following is entirely possible: 2% rise in the price level of physical goods, so 100*((1+2%)^t) is spent on these in period t, and 100*((1+2%)^t) spent on information, which given increased quantities is seeing a per unit price fall of (1+2%)/(1+5%)-1 per period.

        This is runaway economic growth: in nominal terms the economy is growing at 2% per year, and in real terms it’s growing at something like 2.5% per year (5% growth in supply of something for which there is a 50% expenditure share).

        I entirely agree with you that it seems unlikely we can get exponential growth from information exchanges, but until we hit thermodynamic limits that come from the exchange of information, there is no logical reason why this cannot be so. Once we hit thermodynamic limits on information exchange of course. every good is a physically produced good.

        • In the fantasy world, I would agree with the scenario and cannot dispute the math. If the physical resources are steadily available indefinitely at 50% of income, I can imagine room for increased information flow. I’m not quite sure how much we care to have: my brain has limited bandwidth and needs sleep sometimes, so I perceive some limits to how much information flow I want.

          In the scenario where physical resources prove to be finite (appreciated shortly after realizing that the planet and its energy reserves are finite), we are likely looking at a different phase, rather than a continuation of the past few decades.

          If we had only used 2% of fossil fuel reserves at this point, I’m pretty sure I wouldn’t be making any noise. But it’s something like half in about a human life span. Now I’m sitting up. Even if I have the timescale off by a factor of two, this is still something we owe it to ourselves to acknowledge, and have a “break in case of emergency” plan, rather than asserting that we have no concerns about economic growth continuing until thermodynamic limits on information exchange are reached.

          • I’m not asserting that we have no concerns until thermodynamic constraints on information exchange are reached. In the real world I entirely agree with you.

            I just felt that you were trying to construct a logical deduction, and I thought the logic didn’t hold, in your final couple of sentences.

      • @tmurphy
        > [Resource prices approach zero over time] this doesn’t make sense.

        Resources have always gotten cheaper over time. Yes, they do indeed approach zero over time, because of the process of increasing automation that’s been occurring over the past several tens of thousands of years (people created — via selective breeding — and employed plants and animals essentially as robots), and particularly over the past 200 years.

        > we can’t continue our track record of 3% energy growth per year for even several hundred years

        It could be continued for at least 300 years. It would be better for people to reach that “limit” sooner, than later. It isn’t the gradual progression that’s helping people. It’s the actual burn rate at any given time that’s helping people. The best scenario for people (meaning they would be better off) would be to jump instantly to whatever the supposed “limiting” burn rate was, rather than waiting hundreds of years.

        > The fact that we have not hit the bounds in a few generations of outrageous growth should not be taken as evidence for our long-haul prospects.

        The fact that a supposed doomsday can and has been continuously rescheduled cannot be taken as evidence of a supposed doomsday absolutely having to occur within time-frames people actually care about — say, the next 100 years. A supposed fact that civilization might not have much chance of lasting beyond a trillion years might not bother many people, if they knew that was what doomsayers were actually referring to.

        • In this phase of expansion and surplus energy, resources may get cheaper. I’m not willing to extrapolate this tenet to the fossil decline phase. I still think the 100 year timescale is one likely to see tremendous change (can’t predict direction), so we need to take it seriously. Dismissal (especially trillion years?!) is dangerous.

          • There’s a principle in economics called “substitutability”. Paul Ehrlich discussed it a lot in his lengthy 1977 economics textbook “Ecoscience”. Whether people get their liquid hydrocarbons from “fossil” sources, or whether you get them from captured CO2 recharged with nuclear power isn’t germane to hose buying the fuel. They just want fuel that will do the job, and they want it at a good price. That price on liquid hydrocarbon fuels — not “fossil fuels” specifically — is axiomatically bound to decline, so long as efficient property-rights continue to obtain at roughly today’s levels.

            However, even fossil fuels could be produced at below unity EROEI through the simple expedient of using nuclear fuels to provide the production energy. Because of that, people might never have to reconstitute liquid hydrocarbons from captured atmospheric CO2, while still enjoying ever-greater, and ever-cheaper, “fossil” fuels.

            As for crude oil lasting at or below present prices for the next century, Peak Oil advocates claim there are at least 2.1 quadrillion barrels of it left:

            That’s 75,000 years’ worth at the present consumption rate of some 77 million barrels per day (the rest included in what is commonly cited as some 90 mbpd isn’t crude oil; it’s other types of “petroleum”).

            As for my “trillion years” remark, I would have said “billion”, but for the documented fact we are sitting on tens of billions’ of years’ (at 16 terawatts) worth of fission fuels in the earth’s crust alone, and for the facts that Earth could be shielded at Sun-Earth-L1 from an expanding Sun a billion years from now, or simply moved to a higher orbit. An Earth-bound civilization could continue to fuel itself with fission of seawater components, and then import fission fuels from the gas giants — out to a trillion years or beyond.

            It’s not important that we can’t prove it will happen. It would be important if we could prove that it can’t happen. But we can’t do that, because we know the fuel exists, and because we know why all resources keep getting cheaper: property rights. Since we know we have the fuel, just keep the property rights, and keep the Ultimate Resource (people) sufficiently high, and everything might be fine.

        • The thing is, 3% annual growth for 300 years is a factor of 7,000. Since annual energy consumption is currently about 15TW, after 300 years we’d be at 105PW, about 60% of solar insolation. The entire planet – oceans included – would have to be covered by solar panels of an efficiency close to their thermodynamic maximum (86%) and interesting things would have to be done to preserve ecosystems. We’d have come to the brink of being a Kardashev Type I civilization.

          If it’s not principally solar (perhaps some form of fusion) then it’s worse: unless either the vast majority of the population lives off-planet by that time, or a huge swathe of that power is devoted to planetary heat rejection, the effective temperature of the planet would go up by 37K.

          So 3% annual energy use growth for 300 years can be had without violating physics, but would require either a dramatically different planet or a mass exodus from it, regardless of the technology used.

          • Was there a mass exodus from Europe to the Americas? No. Yet in spite of that the Americas are home to many of European descent and they’re producing a lot of energy.

      • @tmurphy
        Interesting approach, plus regarding “information goods” the current mantra is more “everything should be free and ad based for revenues”(these ads being mostly or often for “physical goods”), so that the information or digital cultural goods market ends up being a “physical goods market” accelerator more than anything else.
        (and one could had the t shirts and other products associated to “cultural goods” there).

  3. Resources are limited but so are our consuption abilities. We can’t eat more than finite amount of food. We can’t drive a car 24 hours a day. We can of course waste many resources, leave a car running while we sleep or throw out food etc.

    But is amount of wasted resources a good measurment of wealth?

    Considering only resources needed (not wasted) for single person, how much more can we consume? Flying cars? More food? Better computers? Where coud we use more energy?

    • One model might be to look at the total resource consumption of the top 1% of people in terms of total wealth and compare that to the some other portion of the population that might want to have that standard of living.

      If that came to pass, I can imagine using a lot more resources per capita on travel, dining, homes, security, cars, etc.

    • @Adam
      > Where [could] we use more energy?

      There’s something called a “server farm”. In fact, you’re using several of them right now (consuming energy, and ever-more every year, apparently without even realizing it). There’s no limit to how much these server farms can grow, nor to how much electricity they can consume (thermodynamic limits ignored). The bigger and faster they get, the more value they provide to people — with no limits. In the future, virtually all societal power will be consumed by computers — not your home computer, and not the computer in your pocket, but the computers they connect to.

    • Of course, till Moore’s law will hold, running bits will became cheaper and cheaper. But almost infinite consumption can be done by moving atoms in larger and larger scales. E.g. Creating larger and larger infrastructure, flying to take breakfast from New York to Paris, then flying to Moon and Mars and beyond.

  4. One has to welcome the appearance of this program as part of the BBC’s “Richer World” season (no, really, it’s called that). But it was sad, albeit not surprising, that Tom seemed to be the only participant grounded in reality.

    Perhaps inevitably the “stand-up economist” made a reference to “cheap gas” and came out with the popular fallacy that: “The folks who were talking about peak oil a couple of years ago are not talking so much about peak oil.”

    Overall the program was a reminder that even people regarded as smart mostly have no idea what we are facing or why.

  5. During some time in their early development, humans were living on an 12000 square kilometer area in the Rift valley. Did this race have a prayer of generating 143000 terawatt hours per year?

    Obviously not. This would have put their energy production at 1361 watts per square meter. 1361 watts/square meter is the solar constant, the amount of energy per square meter from sunlight.

    With double sunlights’ energy per square meter during the day and a 1361 watts/square meter throughout the night, it’s obvious humans would roast themselves should they ever generate 143,000 terawatt hours in a year.

    Is this a horribly silly argument? Why, yes. Yes it is.

  6. I really like one of the points raised above: there is little advantage in slowing down the energy consumption until you get to the carrying capacity. Until easily reachable fossil fuels are exhausted, there is little change of developing enough economic incentive for shifting to renewable resources. You’d have to legislate for fossil fuel taxes across all countries and good luck with that. Actually fossil fuel scarcity would achieve it, but we are far away. While I can believe the transition might be disruptive, I don’t think it would be that disruptive unless you believe the carrying capacity is already exceeded, which I think it’s not true in a physical limit terms, even if it might be true in terms of current technology. But current technology is somewhat irrelevant since there is not enough current need to develop renewable energy given abundant fossil fuel deposits.

    As far as the last statement, human consumption has already shifted a few times. Originally food was the large majority of all production, then goods became the large majority, currently services are the vast majority. Services can have massively lower energy intensity: being a doctor or a writer doesn’t require a lot more energy than just existing, but can generate orders of magnitude more GDP. As you shift more and more population towards those kind of jobs, you might get growth. People will consume less cars and more live concerts/books/doctor’s visits (and I guess they will walk or take public transport there). People in general will simply consume more non energy intensive goods. We can build server farms orbiting earth providing services back to earth. We can genetically engineer plants with a more efficient photosynthesis…

    Can this continue indefinitely? No, we cannot. There are some limits in terms of energy requirement for information transfers, which we cannot break. But who cares? If your argument is that at some point in the distant future we need to stop growing, this has very little impact on current policy. I think there is little reason to believe that energy usage one order of magnitude higher than currently couldn’t be sustained indefinitely. So let’s get there quickly… Once we are there and fossil fuels ends (or we find out we cannot uses them without making earth uninhabitable and we have to legislate against their use), there will be an economic incentive in switching to renewable. Before that it’s pointless. Nobody is going to invest in them because fossil fuel could run out in 100 years time… You need actually scarcity to stimulate substitution and we haven’t go scarcity yet. Get oil at 250$ (and it can get there quite quickly as we have seen) and you’ll see all kind of action.

    • I strongly suspect that doctors use more energy than the average Joe via lifestyle. It’s a fiction to assume that a “service economy” is a low energy one. Societies where services are large parts of the economy tend to be prosperous ones that use a heck of a lot of energy per capita. Services can’t grow to utterly dominate the economy, either—and typically ramp up only after physical (resource) needs are already met.

      Looking at past triumphs of the human endeavor is worth doing, but such instances do not constitute a hard contract with nature that we will always be able to solve our problems. All those past triumphs were in an “empty earth” scenario and not the “full earth” we inhabit now. There is no guarantee that we will find the prosperity (historically tied to resource consumption) to afford a more expensive world—especially if we want to bring the poor up to speed.

  7. I dont know why you always conflate growth of wealth (or richness, whatever that means) with growth of energy. Just because our energy usage has grown as our richness has grown does not mean it will continue to do so forever. Id be willing to bet that if you compared energy growth rates to GDP growth rates (or whatever measure you prefer for richness), you would find that energy usage per GDP unit produced has likely gone down significantly.

    The other thing you seem to be assuming is continued population growth, which doesnt seem to be likely. Demographers are all saying that we should peak out and begin population decline at around 9-11 billion people. After that, we could all get richer, consume more than we do today and the overall resource usage could go down (depending on how much we consume and how fast the population decline is).

    • Thanks for the respectful and thoughtful comment: I wish all the unpersuaded could be so civil. As an aside, my biggest pet peeve in life is the combination of authoritative and wrong. I can deal with either in isolation: couching a statement in “I’d be willing to bet,” for instance, really takes the edge off for me. Then there is room for discussion, rather than argument.

      So. I take your points to be fine and valid. Although I would not go so far as to say that I conflate economic growth and physical growth. I relate the two, but in my mind not in a way that mixes or confuses them. It is certainly true that they have gone hand in hand for a very long time, but as you say this is not enough basis to assert that they will always do so in lock step. Indeed there are plenty of examples of low-energy economic activities (art sales), and as such I don’t disagree that energy/GDP can trend downwards. I would be in denial to say otherwise.

      That said, I fall back on the following argument: let’s assume steady population, steady energy use (no physical growth). Leaving aside the question of how we even do this given that some critical resources are finite, I come into trouble imagining a continuing trend of arbitrarily growing GDP under this physical constraint. Selling more art? Information? I call these frivolous, somewhat dismissively. But the point for me is that if GDP is to continue growing, then those non-physical (or lower intensity, more accurately) activities must dominate the economy: more so each year. Before long, the finite physical goods are a small part of the economic scene (essentially free) and this defies my common sense: the finite, limited, essential goods will always hold on to a baseline value. And if this is physically held fixed, the GDP can’t sail away forever. It does not mean we can’t have more “decoupling” tomorrow, but neither can we expect a complete decoupling, except economists decoupling from reality. Earlier posts (here and here) cover these notions.

      As for continued population growth, I certainly don’t believe it will continue to rise indefinitely. I’m a big finite guy. Rise, peak, decline are part of my word view. The manner is important, and I lack the clairvoyance to state how it will play out (wealthy lives or famine and chaos).

      • Thats why its so important to define terms like “wealth”, “richness”,and, in this context, “growth” and “forever”.

        When i think of wealth i think in terms of human happiness, not necessarily physical stuff. Having access to goods a services that make me happy make me consider myself wealthy. So, given that definition, its easy to imagine our wealth growing forever (or, at least, long enough). After all, if i can give my kids exactly the same physical stuff that i have, plus access to twice as many books and movies and art and all that, then from a wealth perspective, they would be wealthier then me. Obviously, if your definitions are different, then your conclusions will be different as well.

        To your second point, i dont see that it matters if low energy activities come to dominate the economy. You are right, that physical things will always hold some baseline value, but that does not mean they are free, it just means that more and more of our value will be derived from non-physical things. If i can take a stab at representing this mathematically (and im no mathematician), if X represents physical wealth, and N represents (mostly) intangible wealth, the X+N represents our total wealth. No matter how large N gets, X never goes to zero, it just becomes less and less important to our overall wealth. Actually that sounds like a pretty nice future, one where everyone’s physical needs, food, housing, medical care, et, are easily satisfied, and people dedicate themselves to intellectual pursuits which are considered the real wealth. Whats wrong with that?

        • I can’t fault the dream. It’s a lovely picture of the future. And obviously I can’t prove one way or another how things will play out. But I’m bothered by a few fundamental principles. Nature does not care about our dreams. The physical world’s limits may prevent a perpetual increase in wealth (even if more ethereally defined). What if in 2043 the oil supply fails to keep up with demand in a population-swollen world (and we never got our act together and kicked the fossil fuel habit while oil seemed cheap and plentiful enough), leading to rationing/hoarding on the parts of Middle Eastern countries, spurring the U.S. to militarily seize control of the region (thank you Cheney/Bush for building permanent bases in the “glittering prize” Middle East), provoking China to say “not so fast” so that we find ourselves in a destructive resource war—in the process taking a step back in standard of living as (limited) resources are diverted to destruction. Only this time we’re not sitting atop cheap and plentiful energy to pull out of the malaise when the dust settles. Our grandchildren have fewer books than we did and no one considers the world more wealthy. We find it hard to rebuild to the pre-war state in a fractured, depleted, jaded world. I’m not trying to predict the future as much as illustrate a plausible path for the world. Just because we can imagine eternal wealth does not mean the real world will play out that way, or that we’ll collectively get our global act together to allow it to happen. Failure to recognize this plausible peril and act to avert it could be the most dangerous act of our generation.

      • That looks interesting, although i dont understand the details of his modeling. Im no expert, but one problem i see here is that he doesnt seem to make any effort to answer the question, “are we using more energy every year because we have to, or because we can?”

        If the answer is ‘because we have to’, then, barring some science fiction technology, we will hit physical limits in no time. If the answer is ‘because we can’ then energy constraints are not really constraints on growth of wealth. We will economize our energy usage when we have to, but not really before.

        To offer an analogy, computers have become more and more capable as time goes on, but also use more and more data storage as well (like disc space, hard drives and such). You might be tempted to say that more storage space is necessary for computers to become more capable, and you would be at least partially right, more advanced programs typically require more storage, you arent putting windows 7 on a 3 1/2” floppy. However, while you would be partially right, you would also be substantially wrong as well. Computer people dont economize disc usage because bigger and bigger discs are available to be used, so why not use them? Once you start running into constraints, thats when people start putting effort into economizing usage. For example, smart phones are physically constrained due to their size and so their designers and programmers take pains to limit disc usage that they wouldnt take on a desktop. Does this mean that computers could increase in capability forever without ever using more storage? No, but it does mean that the relationship between computer capability and disc usage is more complex than “if computers increase by X, then disc usage has to increase by X/n”

        The same is true of energy usage. While our energy usage has increased as our growth has increased, we dont know how much of that is because we had to use more energy and how much is because we could use more energy.

        • I would be very careful about analogies between information technology and energy. Listening to a piece recently about batteries, the opening question was something along the lines of: “If computers, cell phones, and other tech devices have seen orders-of-magnitude of performance improvements in the past several decades, why haven’t batteries paralleled that success? Why aren’t they 100 times more energy-dense than they were in the 70’s? Where is Moore’s Law” I almost blew my lid. Information technology has been in a frontier mode—many orders-of-magnitude away from quantum limits. Moore’s Law was possible. Batteries are chemically constrained, and have been near the limit for over a century. Lead-acid batteries came about in 1859 and are still the cheapest storage we have. We might see factor-of-two level improvements across decades, but no revolution (and none anticipated). At 80% round-trip efficiency, for instance, how much better might they get?

          Want to heat your home against the winter chill? Boil water or cook your food? Propel a car through the air at “convenient” speeds? Place a satellite in orbit? Grow, fertilize, harvest, and distribute food? These are not going to see revolutionary changes in energy required. The physics is too simple/straightforward. No orders of magnitude to be shaved. The only way to substantially reduce energy in these domains is to not do them. Don’t heat your house. Is that a wealthy life?

          Just because we can find amazing examples in one domain does not allow us to make sweeping statements: “and so it will be with X.” Being able to thoroughly understand one sort of transformation does not make us any smarter on how the world will progress.

  8. To reinforce Dr. Murphy’s point, economics is a social construct, it is not physical. What is physical is the transfer and transformation of energy.

    The next time you purchase a chocolate bar at convenience store using a credit card, instead of thinking about the money your are spending, try contemplating all the different forms and amounts of energy that are being shuttled around with that one transaction.

    That exercise will give you a much more grounded perspective on the processes, social or otherwise, occurring on the surface of this planet, than any of economics’ polemics.

    Or to apply a paraphrase of Dirac’s thoughts on religion:

    Just because very intelligent people are quite accomplished at discussing economics does not mean it is real.

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