Population go boom now?

So when is that population bomb going to happen, exactly? In theory, exponential increases in human population should eventually be constrained by limited, non-renewable resources. One way to track an impending resource crunch — when high demand hits low supply — is by watching for a surge in the price of various goods.

In 1980, biologist and author of The Population Bomb Paul Ehrlich wagered economist Julian Simon that demand for five different precious metals, including copper, would result in higher prices for those metals.

After ten years and 800 million more people, the largest increase in a single decade in human history, the inflation-adjusted price of all five metals had gone down. So much for resource catastrophe.

Fast forward 18 years. The New York Times recently reported on the boom and bust cycles of copper extraction in the rural West — the article was a look at what should be a growing sector of the economy. Turns out that bubble appears to have burst, too. The Times’s article made me wonder how the Malthusian predictions are holding up, now that we’ve steamed past 6.5 billion people.

Surging demand in India and China pushed copper prices to big highs in 2006, only to come crashing down this year. After a few years of looking like we’d finally hit a point of true scarcity, demand for this resource has fallen again and the price is back to historic levels.

So when is the resource limitation/population growth trainwreck supposed to happen? I find myself in a strange position of bracing for an environmental apocalypse (because the earth is obviously finite), but scratching my head because we haven’t maxed out yet (although examples of collapsed societies exist). If anybody can predict when, precisely, I should start worrying, please let me know. I’ll want to stock up on Twinkies.

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tim

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  1. Tom Harrison - December 8, 2008

    Tim —
    In college, when I was almost fully brainwashed, I wrote a junior economics thesis (in 1983) debunking Ehrlich’s Population Bomb assertions. Of course Malthus gets first credit for failing to properly understand how dynamic and responsive humans are when faced with our own demise. Both did modestly simple extrapolations (projections) based on current trends to predict an outcome far in the future.
    This kind of projection about what will happen to people is fundamentally flawed … even more than a long-term weather forecast. Weather forecasts are wrong because there are a great number of variable factors, and further, those factors are in some cases correlated thus multiplying the uncertainty of the estimate — “two feet of snow” can turn into “flurries” before anyone knows. And thus, we have chaos theory.
    But projections of the demise of humanity, as made by Malthus and Ehrlich and others suffer yet another confounding factor: we people tend to respond in one way or other to signals of the coming apocalypse, and this really screws with the raw data. (Macro game theory?) If we simply kept doing our thing then I am sure their predictions would have been no worse than a long-term weather forecast.
    And of course the kind of people who write about these horrific impending human catastrophes tend to be, well, a little on the dramatic side (if you know what I mean). A lot gets written, some people take notice and vociferously agree or disagree, other deny, a few things change, and time passes.
    So of course, in retrospect, those predicting our imminent demise are always wrong. News of our death is premature, to poorly paraphrase Mark Twain.
    Paul Roberts might be our latest apocalyptition (“one who predicts the coming apocalypse” ?), having written both “End of Oil” in 2005, and “End of Food” this year (Damn, this guy better get a new title theme!) Or maybe Thomas Friedman’s “Hot, Flat and Crowded” gets this honor.
    Yet, here we go again, ruining their terrifying predictions by going and making changes! Hell, this Obama guy is already messing with all the data points and totally screwing up all the best predictions of how things will turn out. Can’t we just be a little scientific? Doesn’t anyone else on this planet play poker?
    But I personally salute our current President, W, for throwing the biggest curve-ball to all those doom-and-gloomsayers predicting oil prices would keep going up, and oil would run out and stuff. George W figured on a way to make the entire economy of the world fall so far into the tank that we wouldn’t have enough money to spend on SUVs, cheap Chinese consumer goods, or heat and hot water. Pure genius! Climate and energy problems solved, and only just a few weeks before he left office. My hero!
    Ok, so to stop being a jerk, my point is: people respond to books like Ehrlich’s and Malthus’s. In so doing we tend to address the specific problems identified, thereby taking pressure off the problem … so that some other aspect of the same issue can arise in a few decades … causing a new round of predictions, and responses, and so on.
    I might argue that an attempt to accurately characterize a planet-threatening problem which subsequently turns out to not happen may be a causal correlation. (Nothing that those guys at Freakonomics couldn’t discover with certainty with a quick regression analysis, I am sure).
    Needless to say, I got a C on my junior thesis, because I angered the gods of the almighty Princeton Economics department with just such heretical assertions. Either that, or it was the beer.
    Tom

  2. Klockarman - December 9, 2008

    Tim,
    It sounds like you’re at the same crossroads I came to several years ago, i.e. that the environmental/population/resource apocalypse just wasn’t happening, and I was wondering WHY? Then I read Julian Simon’s book, The Ultimate Resource II, and it blew my mind (that’s the best way to describe it) in a good way.
    Many people will just dismiss Julian Simon’s theory out of hand, because it sounds so preposterous. I will admit that it is definitely counter-intuitive to most people’s common sense. However counter-intuitive it may be, that doesn’t automatically equate to it being wrong.
    His main idea is:
    “More people, and increased income, cause resources to become more scarce in the short run. Heightened scarcity causes prices to rise. The higher prices present opportunity, and prompt inventors and entrepreneurs to search for solutions. Many fail in the search, at cost to themselves. But in a free society, solutions are eventually found. And in the long run the new developments leave us better off than if the problems had not arisen. That is, prices eventually become lower than before the increased scarcity occurred.”
    This idea is not just some short term trend of the last several decades, but has been the case for many centuries – and after I read Simon’s book I’m convinced it will continue to be the case for the forseeable future.
    It sounds like you are curious enough about the subject matter that I’d suggest you read the book. I’m sure your local library has it, or you can read it here for free online…
    http://www.juliansimon.com/writings/Ultimate_Resource/
    Highly recommended reading for all of your blog’s readers.

  3. Fernando Magyar - December 10, 2008

    Why are gasoline (and oil) prices so low — and where are they headed?
    Posted by Gail the Actuary on December 8, 2008 – 10:20am
    http://www.theoildrum.com/node/4846
    This particular post happens to adresses the price of gasoline (oil) but if you take a look at the supply and demand graphic that is included, it is plausible that similar fluctuations would be occuring for metals such as copper, etc…, this is partly due to demand destruction. We are now entering a phase where stability of commodity prices is no longer to be expected because we are seeing the beginings of chaotic oscilations. Please google Chaos Theory.
    So to answer your question: “If anybody can predict when, precisely, I should start worrying, please let me know. I

  4. Tom Harrison - December 10, 2008

    Fernando —
    My tome above was a response to the simplistic approach that Ehrlich and others took to predict dire future outcomes through simplistic projection methods. However I don’t think it’s any more correct to assert that our situation is purely chaotic.
    Like the weather, the future behaves chaotically in some ways (yes, I also studied chaos theory, and more recently have read almost all of Wolfram’s “A New Kind of Science”). But even if there are (large) elements of the future over which we have little or no control, I would like to think we are not entirely powerless, as a species, to reverse the course of our foolish behaviors.
    I could be wrong…
    So, off to buy the twinkies.

  5. Gail Coffey - December 10, 2008

    As humans, we can’t conceive of our own destruction, so we keep hoping we’ll either invent our way out of the problems or just ignore the problems and continue with our excessive consumption of resources.
    Let’s face it the quality of our environment has already rapidly deteriorated, our water bodies are full of pollutants, our air is loaded with toxins and we are dumping waste wherever we can find a spot. Our fisheries are depleted, forests are being extensively cut and wildlife populations are rapidly declining. It’s only a matter of time look at the increase in resource consumption in China, India, Latin America…
    Without clean air,water, beautiful forests and wetlands, and the extraordinary diversity of life on Earth , what does it matter if we are still alive ?

  6. Jeff B - December 10, 2008

    Tim Varga, Tom Harrison, Klockaram, Fernando Magyar,
    I applaud all of you for putting time and effort and thought into this topic. What I’d suggest is perhaps looking at the empirical evidence and then to postulate what might happen in the future.
    Here are several examples…
    – The water supply is becoming increasingly constrained on a per-capita basis for people who live in Palestine. The West Bank has 2.4 million people living in an area the size of Delaware. Population growth rates are 2.2% per year with each woman having 3.7 children.
    – In Rwanda, where we had recent case of genocide, there are 10.2 million people living in an area the size of Maryland. Population growth rates are 2.8% per year with each woman having 5.31 children.
    This data can be found on the CIA Factbook. https://www.cia.gov/library/publications/the-world-factbook/
    In short, we already have examples of episodic events proving Ehrlich’s hypothesis. The proof of this hypothesis won’t be a sudden cataclysmic event but will prove itself with increasingly frequent localized emergencies–Darfur, Gaza, West Bank, Rwanda, Kenya–where the poor and marginalized who lack the means to bid for resources will be subject to famine, disease and violence.
    I’ve also thought about Julian Simon’s hypothesis. He fails in his analysis though is not correlating “price” to “energy”. It is only as long as there are cheap and readily available supplies of energy that humankind can respond through innovation. Mining and refining lower quality ores is only possible with low cost energy being available. For those who follow issues of oil depletion, there is substantial evidence that we’re on an accelerating timeline where we’ll be placing more and more of our resources in developing lower quality oil supplies. The “end-of-cheap-oil” is just another way of saying we are going to be placing more resources chasing dwindling supplies.
    Good luck to all on your journey. Keep up the critical thinking.

  7. Fernando Magyar - December 10, 2008

    Tom,
    “I would like to think we are not entirely powerless, as a species, to reverse the course of our foolish behaviors.”
    I would like to believe you are right but I’m going to hold off on the Twinkies for now…
    You may be familiar with this paper from Donella Meadows, Leverage Points Places to Intervene in a system, I think she is on the right track when she says we are pushing hard in the wrong direction on the right points.
    Good Luck to all of us!

  8. Amanda - December 10, 2008

    I would love to read Tom’s junior thesis- I’m sure I would appreciate it (as a graduate from CU’s Econ program) more than the almighty Princeton gods :)

  9. Justin Hampton - December 10, 2008

    Tom,
    i’d love to read your junior thesis paper too! can you put it up?
    All,
    As an Anthro/Econ/Geog/Psych study (Social Science grad. SDSU 07′)I have been tip toeing around our global condition here and there but never on it. I have never heard it referred to as chaos theory but i have heard it referred to as evolution. when a species can not sustain it’s self in an environment and all attempts to naturally correct its self fail to work, that species must learn to adapt or die. Mankind’s best evolutionary advantage is to solve problems. But often times our problem solving creates more/bigger problems. We drastically change our environment, as population grows, we have moved and fanned out, drastically changing everything as we go. Has mankind evolutionary advantage finally reached a point where we have to look inward for change instead of changing our surroundings. Humans, like all species will eventually have to adapt or die. Can we use our evolutionary tools to fix our paradox? We have to adapt our way of life or we will be forced to adapt by each other (chaos theory). a stupid quote i ran across on a TV sitcom, “If you do not choose your path, it will be chosen for you.”- Heros. It seems like we can not escape this issue, can we right our own course with population control or will we just take it to the limit in a race to oblivion?
    I can’t imagine the human race totally dieing out, i imagine worst case scenario would be global famine, pandemic disease, international warfare, government collapse, economic collapse, rising oceans, catastrophic environmental degradation, up to 99% human extinction rate, pockets of human subsistence/hunter gatherers, tribal warfare, cannibalism. But eventually we will reach a point of stability, and homo sapiens will survive. Then in 100’s, 1000’s or years from now we will rebound our exponential population growth followed by unsustainable consumption, and will be right back where we are. we are fairly resilient creatures and our ability to solve problems won’t let us die out.
    If you like Carleton Heston & world wide over population movies, check out “Soylent Green”
    this is my first blog ever, hope it was relevant!

  10. Ken B - December 10, 2008

    There’s are two simple reasons why Ehrlich lost his wager with Simon, and why gas prices can go down as global supply shrinks (which of course it’s continuously doing as we burn fossil fuels):
    1) Price is a function of how much of a resource we’re extracting/processing from the ground right now, balanced against demand. Price is NOT a function of overall supplies still left in the ground versus demand.
    2) We’re externalizing much of the environmental and social costs of resource extraction – in many cases by extracting in the developing world, which has lower labor and environmental standards. If we paid the full cost of these externalities, prices for resources would be higher.
    All this is part of why the peak oil folks are so worried about future prices – if price is not an adequate signal of scarcity, it won’t signal that it’s time to start developing renewable alternatives, as neoclassical economists have always told us will be the case. If instead we’re left with price spikes (perhaps alternated with price drops, like we see now), it becomes much harder for the market on its own to send signals that we need to start developing alternatives.

  11. Fernando Magyar - December 10, 2008

    Justin,
    “I have never heard it referred to as chaos theory”
    Just for the record this was a reference to wild fluctuations in commodities prices after they have reached their peak availability due to finite limits and they are in decline. That is when the normal up and down cycles of supply and demand start oscillating or become chaotic.

  12. Howdy Doo - December 13, 2008

    My opinion is that rational control of population is important to quality of life. Excess demand promotes exessive cost of goods necessary to survival. Excess production promotes excess pollution. Plus, I just don’t enjoy crowds. On the highway, at the grocery store, in the soccer stadium, or otherwise. No need to hurry to run all the souls through the grinder. We have plenty of time as long as we manage our activities intelligently with an eye to the present and the future.
    Now, with that said, I have always been pro-ZPG. For some reason apparently beyond my control, Joy of Sex resulted in a doubling of our contribution to population growth. Nice kids too!

  13. Klockarman - February 18, 2009

    Hey, is anyone still hanging around this post? I know it’s been a while. Long time no see.
    But seriously, I remembered this conversation when I saw this a minute ago…
    http://mjperry.blogspot.com/2009/02/julian-simon-vs-president-obamas.html
    After telling the story of the Simon/Ehrlich wager and the result, the next passage caught my eye:
    “An expert Ehrlich consulted in picking the five was John Holdren, who today is President Obama’s science adviser.”
    Hmmmm. Hopefully Holdren learned something from that experience, but I doubt it.