Investor Jeremy Grantham: "We're Headed For A Disaster Of Biblical Proportions"

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107 Responses to “Investor Jeremy Grantham: "We're Headed For A Disaster Of Biblical Proportions"”

  1. Stefan Jones says:

    There are solutions to nearly all of these problems that don’t require massive numbers of people to starve or kill each other.

    Unfortunately, this means doing what those goddamn hippies and environmentalists have been telling us what should be done for going on fifty years, so that’s not going to happen.

    • Dan Hibiki says:

       what, start encouraging the use of condoms?

      • Gideon Jones says:

        We’ve encouraged contraceptive use, and it’s cut birth rates to below replacement levels.  Life expectancy however, has kept climbing, and consequently, so has the population.  But the idea that people are out there having huge numbers of kids still is just not right.

        • Dan Hibiki says:

           you don’t get a longer life expectancy in countries with a high population growth which are also the countries worst hit by rising food expenses and don’t use a lot of contraceptives.

          • Funk Daddy says:

            By my estimation the greatest contraceptive effect available is gender equality and representational governance that eschews religious influence.

            However, that comes with the drawbacks of increased consumption and longer life expectancy per capita.

            If it ever balanced on a global scale we could probably manage to have long life, plenty to eat, good jobs and nice stuff with 2.2 children per family. And since then there would be little left to do here, a real nice space program.

            So if everyone could just bear with me, put aside bigotry of all sorts and cancel all evangelical religions maybe we could have space ships.

            Also we have to stop flying.

          • Gilbert Wham says:

             If we all promise to be really, really good, can we have Zeppelins too?

            /doesn’t care one iota about the economics of Zeppelins; still wants Zeppelins/

          • loco5niner says:

            “…put aside bigotry of all sorts and cancel all evangelical religions…”

            Well that’s a little contradictory.

            PS: How is longer life expectancy per capita a drawback?

          • Funk Daddy says:

            evangelical in the zealous/recruit/with us or against us sense that demands it’s adherents attempt to influence secular governance. I’m not referring to just Protestants, the Evangelical Church of Germany or only christians. 

            My statement stands in that it infers not all religious people are bigots, yet remain a problem in their own right unless it is a faith that does not do what I specified as evangelical. 

            Though I’ve never seen that religion, I’m sure it exists. Probably after death.

            p.s. extended life expectancy would mean more people around. Like if we all lived to an average 30 you can expect a family photo to be parents and children. If we all live to 70 you can expect the photo to contain children parents, grand parents and great grand parents. So if people are having 5 kids and a life expectancy of 30, it’s still less mouths to feed than people having 2 kids and living to an average of 70.

          • Dan Allard says:

             I read your comment in the voice of Hans Rosling, complete with animated graphs.

            http://www.ted.com/talks/hans_rosling_religions_and_babies.html

    • foobar says:

      Ramping up the space program and GMO foods?

    • jhertzli says:

       I never realized hippies were pro-nuke.

  2. Michael Langford says:

    I find these two statements contradictory: 
    “as people get richer, they eat more grain-intensive meat”
    “Because the population continues to grow at over 1%, there is little safety margin”

    • PaulDavisTheFirst says:

       why?

      • Chris Drouin says:

        Mr. Langford has a modest proposal in mind that would help us deal with the population growth and solve our protein deficiency in a single stroke.

      • Marja Erwin says:

        Because we can use fewer resources by eating less meat. Because we can free up resources for a safety margin by eating less meat.

        • PaulDavisTheFirst says:

           sure but grantham is making an observation about actual human behaviour rather than what we wish would happen (or what needs to happen). i don’t see a contradiction. we could many, many things to improve our situation, but the historical evidence strongly suggests that we do not except for when the danger presents itself in very specific ways.

          • Funk Daddy says:

            The history that gets top billing seems to suggest that because guns and swords are cool.

            But many many people of all current and previous generations and cultures have had leaders, innovators and other generational+ thinkers.

            But the History Channel doesn’t make the big bucks keeping the gawk glued on by showing trees being planted or the slow developments of technologies, social sciences and stuff. Shit’s boring yo. Instead, heeeere’s Hitler!

          • cjporkchop says:

            When’s the last time you flipped to the History Channel? It’s not the Hitler Channel anymore. It’s the Reality-Shows-On-The-Slightly-Less-Stupid-End-Of-The-Spectrum Channel.

          • Funk Daddy says:

            My TV viewing is almost nil these days, but that sounds like a downgrade. Good that they opted for Slightly Less Stupid side but still.

  3. gadfly says:

    My my, these certainly are some alarming charts. Hmm? Context? What’s that?

  4. Rob says:

    This is an overly simplistic analysis…. especially with China using up half the commodities and their likely to falter in that… they have their own economic bubble… except when it collapses they will have infrastructure and real estate… better than a damned dotcom collapse.

    The food shortages and riots are a real and present danger. When food costs 60% of your income, and it doubles in price… what do you do?

    • Cowicide says:

      When food costs 60% of your income, and it doubles in price… what do you do?

      Finally start listening to those “dirty hippies” and grow your own?

      • jandrese says:

        Individual level farming is inefficient though.  We like to demonize megafarms, but they’ve allowed people to move on to different things.  Subsistence farming is too time intensive for the modern world.  Sure you can play around with your own little garden, but growing enough food to feed your family is just not feasible for your average suburban family, much less one living in the city. 

        • invictus says:

          Correction: Individual-level farming *using the same approaches employed at factory farms* is inefficient. Yes, if you dump your potato peels in the garbage bin on your way to the store to buy petroleum-derived fertilizer for your cabbages, that’s pretty inefficient.

          Individual-level farming is more about capturing waste energy and nutrient streams than it is about commercial viability.

        • Cowicide says:

          I guess you haven’t heard of community gardens?  And, megafarms exist because their externalities are pushed onto the rest of society and sucking up our taxes with subsidies.  I agree that family farms are good and necessary, but giant “mega”farms are NOT good, please get and watch this documentary called Food, Inc.:

          http://www.youtube.com/watch?v=5eKYyD14d_0

          • jandrese says:

            Community Gardens are just family plots for city dwellers.  They’re a nice hobby but you’re still not going to grow anywhere near enough food to feed a family on one.

          • Cowicide says:

            The average plot is about 150 square feet. That’s plenty of space to grow food. The point isn’t to eliminate all need for food from farms. What it DOES do is make food budgets more affordable.

            And, once again, I suggest you watch the documentary Food, Inc. and educate yourself on why “mega-farms” are harmful.

          • jandrese says:

            150 square feet gives you a yield (assuming modern farming techniques) of roughly 66.75 lbs of food per year.  http://www.gardensofeden.org/04%20Crop%20Yield%20Verification.htm

            People eat roughly 4lbs of food per day (assuming relatively low calorie vegetables).  Your plot gives you enough food to feed 1 person for roughly two weeks out of a year.  It’s a toy.

            I’m certainly not against home gardening (I do my own), but anybody who think it is going to supply a significant fraction of their caloric intake is just kidding themselves.

            Those Community Gardens only make financial sense because they’re run on donated land.  If you had to pay rent and taxes at anything close to what land in the city would normally cost they would be a massive money loser. 

            That’s why we don’t put farms in the middle of cities.  They need to be out where land is cheap. 

    • ocker3 says:

       If it wasn’t China making all of those cheap goods, it would be someone else feeding the consumerism of the world.

    • B E Pratt says:

       Sorry. Nazi Grammar Police here. Its “they’re” not “their” in this instance. Have a nice day!

  5. stillcantfightthedite says:

    While there will certainly be a massive shift in how the global economy functions, I don’t think “disaster” is the correct word.  Additionally, acting like there’s no possible way we can mitigate the negative side effect of this shift is just silly.  If the demands of the market are severe enough, new solutions become feasible, and then eventually are implemented successfully.  “Eventually” may take a decade, but the interim will hardly be Noah’s Flood.

    • Gideon Jones says:

      How do you mitigate the effects of running out of the energy source required to feed us all?

      • Jim says:

        How do we mitigate the effects of running out of energy required to produce food?  

        We  stop eating so much meat.  That gets us  from 3-1 (chickens) to 30-1 (cows) gains in edible energy from food grown.  If we consume 1/2 as much meat per capita, we end up gaining a fair bit more than 1.2% in feeding capacity.  

        And we could stop production of grains and other plants for transportation fuel.  

    • Dv Revolutionary says:

      And then there is the unexpected. Early in the last century we learned how to separate nitrogen from the air and use that for fertilizer. We would have had a population crisis if not for that but we fed far more people than we imagined we were capable of. The 20th century had a ruff start but it didn’t end in a Malthusian disaster.

      Yes it required energy inputs. Yes it is not everything but it went a long way. This presentation has a slide saying fertilizers (like phosphorus) are a commodity with limited supply. I would like to point out useable nitrogen was in the same category 100 years ago and we piss all the phosphorus we need away.

  6. johnshopkins says:

    One of the commentors posted a very interesting wikipedia article and link to a BBC documentary about how western consumerism evolved from being “needs based” to “desire based” through the work of Freud and his nephew Edward Bernays. 

    links: http://www.youtube.com/watch?v=OmUzwRCyTSo for the documentary and its article  http://en.wikipedia.org/wiki/The_Century_of_the_Self

    Also this collapse is something I have been discussing much in my ecological economics course at University of Vermont, Burlington. I think it is very possible, and unpredictable. Because many of us first worlders have never faced something like a shortage of resources we can’t imagine it happening. If corn gets too expensive we can switch to rice, if not beef then vegetarian, right? Ramen will always be 99c? 

    Not quite, sadly. 

  7. cepson says:

    What are you saying? Dogs and cats living together?

  8. Paul Souders says:

    Grantham’s been beating this drum for a while in Peak Oil circles. He’s now accumulated enough data to bear out his earliest predictions (ca 2004?). 

    Weirdly I find this kind of comforting: skyrocketing prices are a signal that the system is “working.” If by “working” you mean “we won’t be able to afford to eat 3000+ calories a day any more.” With luck the curve will remain gradual enough for civilization to adjust. And by accident this could slow carbon emissions.But commodity inflation will suck major bigtime for people who can’t currently afford to eat 3000+ calories/day.

    • Corrosino says:

       I would agree that rising prices mean the system is working, to some extent.  But the economic system we have currently constructed requires constant growth, or else we slip into a recession/depression: then money dries up, and many go without jobs… and food. 

      I guess that will save on calories.  And eventually, mouths to feed. :(

    • bigmike7 says:

      “But commodity inflation will suck major bigtime for people who can’t currently afford to eat 3000+ calories/day.”

      You could be one of those people next year. Ask the people in Argentina or Greece. We cannot assume we will remain immune from future upheavals simply because we appear immune now. I say “appear” because record numbers of our population are standing invisibly in the modern equivalent of soup lines: food stamp debit cards. The wealthy countries may have the hardest time adjusting to food shortages because our populations have little resilience and so few of us are skilled at subsistence farming on small plots. The best position to be in could very well be that of a subsistence fisher or farmer in Papua New Guinea.

      Also, the “system” might be working, but it is a mistake to imbue that system with a God-like benevolence that smiles upon (or even cares about) our continued comforts or dreams of moving to a techno-green wonderland. Market forces are ignorant of our hopes. Prices are skyrocketing because we don’t have enough resources to support the current petroleum-fueled way of life. As Corrosino says, this current arrangement depends on never-ending growth. I cannot imagine a smooth or graceful transition to whatever it is that is coming next.

  9. Mr. Customer says:

    In which I encounter more evidence for either being totally wrong or being completely screwed. As an armchair Malthusian, being fucked either way is oddly comforting, though.

  10. gwailo_joe says:

    ‘Whaddaya mean ‘We’ Kimosabe?’

    I agree with much of the conclusions; as our extremely wasteful and short sighted policies in terms of energy, diet, construction (you name it) are untenable for the long term.

    Everybody in the world doesn’t get to eat hamburgers, live in giant houses, own two cars and fly wherever they want.  The idea is patently ridiculous.  The vast majority of the global population do not enjoy such largesse now…

    But these charts are hardly convincing me to start digging my backyard end-of-the-world cave: ‘lies, damn lies and statistics’ right?

    For those that live hand to mouth, who have no idea what it’s like to throw away food because ‘it’s old/wilted/I’m tired of eating this’…those struggling billions are truly walking a tightrope I can hardly comprehend.

     And when things get tight for them (and sooner or later it will)…cities around the world will burn.  Lit by the rage of a thousand million parents who have no choice but to watch their children starve.  Eventually helplessness and desperation kindle into something more primal…those will be dark times.

    Will the First World lead the way to make the tough choices for the betterment of the future?  Will our leaders ask the people to make hard choices and accept a life with less bounty and freedom that they have been accustomed to?  (And will the people re-elect those bold leaders?)

    Will those with the most guns and butter share it with the less fortunate..or circle the wagons, close the borders and call in the National Guard?

    I hope the former…but it’s gonna be Interesting no matter what.

    • Carl Witthoft says:

      Maybe, but at the same time, the rage of a few billion parents who are dirtpoor AND living in Africa or Asia will never affect Europe or the USA.  They have no way to get here, and even worse, produce nothing needed by the affluent nations.

  11. SedanChair says:

    It’s okay, *waves hands* SCIENCE WILL FIND A WAY

  12. Nadreck says:

    I wouldn’t worry about it.  Climate change will wipe out all the crops like rice and grains long before commodity prices become a problem.

    • Boundegar says:

      Does that mean they will continue to be cheap for a short while after they have been wiped out?  I do not trust your analysis.

  13. MrJM says:

    Some combination of crowd-sourcing, Joss Whedon and 3-D printing will solve it.

  14. Boris Bartlog says:

    I’d like to know which inflation statistics Grantham is using to normalize his commodity price charts. One possible explanation for (some) of the observed high-side deviations is that the official inflation figures are too low – that is, if you used the higher, ‘true’ numbers, the upturn at the end of some of those graphs would be considerably muted.
    In any case, I expect high prices to result in considerably improved production in a lot of areas (not to mention more recycling). There are commodities like oil where the elasticity of supply is low… but when it comes to e.g. food production, the US at least has a pile of underutilized land. And for some things, like steel… it’s already insanely cheap – multiplying the price a fewfold won’t cause major problems.
    Anyway, I think one of the underappreciated problems with food prices is that the most common problem is *not* immediate starvation by the millions. It’s malnutrition and long-term damage to the future potential of entire generations of people. Dramatic famines can usually be addressed with massive aid shipments, but it’s harder to make sure that everyone has the iron, protein, iodine et. al. that they need in order to not grow up mildly retarded. Once it gets to the point that ever increasing numbers of people can only afford staple grains and cooking oil, that’s going to be a huge problem.

  15. hug h says:

    How much of the dramatic increase in commodity prices over the last few years was due to increased demand for the actual commodity and how much was caused by greatly increased “long” commodity investing by endowments, hedge funds, investment companies, investment banks and other institutions? I have seen strongly supported arguments that oil is artificially high due to investment rather than end user demand.

    • scav says:

      Oil prices are high due to a physical inability to increase supply to meet even the current demand at a lower price. In the medium to long term, the supply of easily accessible oil will continue to dwindle, leaving few choices:
      1) Oil prices stay high enough to make it worthwhile to drill for the difficult expensive oil, keeping supply as high as possible until finally (and suddenly) it is pretty much gone. Interesting times follow.

      2) The economy can’t sustain high oil prices and decline in supply occurs sooner but more gradually, as repeated ever-deeper recessions reduce demand for oil and everything else.

      3) We get out of this situation using a higher order of thinking than that which got us into it. All suggestions welcome.

  16. curt goodnight says:

    for a thoughtful and researched complete rebuttal:  http://www.bigpictureagriculture.com/page/2
    and also :http://www.forbes.com/sites/timworstall/2012/11/16/what-jeremy-grantham-gets-horribly-horribly-wrong-about-resource-availability/

    in a nut shell:  “reserves”   are quite different from “resources”

    • LaGrange says:

      This is the usual “science will find a way” bullshit, also known as “if we can exploit all the resources available including the earths core and maybe a mission to the sun, then we have supplies for a bajillion years. Also, Soylent Green”.

      Yeah, we might be lucky *once again* and find a way to extract another percent or so. 

      • septimar says:

        The Forbes article mentions that potash resources are enough for 7000 years. Phosphate rock is enough for 1500 years. This is WITHOUT all the resources in earth’s core. Please, if you have an actual rebuttal to actual arguments, let us hear it. Until then, please stop with the anti-science propaganda.

        • LaGrange says:

          One, anti-science is not the same as “disagreeing with you”. Two, hyperbole aside, a huge chunk of those “7000 years” could actually just as well be in earths core, and it assumes current level of consumption. Not all resource deposits are as easy, cheap and harmless to recover — which is exactly the same issue we’re having with oil. Finally, the Forbes article is really silly for saying that Grantham doesn’t know things he has specifically said in his own article. It’s just a silly, faith-based cargo-cult piece that assumes that everything will be all right, mistaking the scientists for some kind of wizards or something.

          Basically, if you’re going to call someone anti-science, first check if you’re not in the same bunch as climate change denialists. Because in this case, you are.

          • curt goodnight says:

            I find Kay Macdonald to be a very reasonable voice .  She makes no assumption that “everything will be all right”  – in fact, she  takes a highly visible stance regarding soil. water depletion, mono culture corporate farm insanity, the ethics of corn based ethanol, etc. 
            She points out that Grantham’s data is based on  static  cherry picking- much like the hoopla over , say, dwindling food supplies [fact is, rice surpluses will increase world wide for the 8th straight year]
            It does little good to deny the areas where there is firm research . Cherry picking data because we have a fervent viewpoint does us all a disservice. And it gives the ‘deniers’ an easier target. 

          • wysinwyg says:

            Editing my stupid reply into a hopefully smarter one:

            MacDonald actually does essentially the opposite. MacDonald criticizes Grantham not for cherry-picking but for using publicly available verifiable data for his projections. MacDonald insists that it would be better to use unverifiable and vague estimates of future data rather than accurate, verifiable figures from present data. Also, MacDonald’s article doesn’t really take on the substance of Grantham’s arguments but quibbles with just one of Grantham’s examples of a larger principle.

          • septimar says:

            …You are seriously lumping me together with climate change denialists.
            Wow.
            You can’t imagine how infuriated I am right now. Just imagine I’m hurling a litany of profanities at you. Wow.

          • LaGrange says:

            Hm, I guess this is where I shall call Poe’s law. While I’d love to say I reacted the same to you calling me anti-science, but I’m afraid I just smirked a little. So much emotion I’ve missed that way…

            Anyhow, yeah, sure, and can I imagine you getting an aneurysm instead, please? 

        • wysinwyg says:

           I can’t find where the Forbes article says those things.  Please post the quote?

          The actual rebuttal is to point out that Worstall is counting phosphates at concentrations so low that it may never make economic sense to extract it.  He’s saying, “Look, if we invent some magical technology in the next 20 years we’ll be all set.” 

          Grantham is making a more sensible case: of the phosphates whose extraction makes economic sense, 75% is held by one nation-state putting them in a great medium-term position to make a lot of money on phosphates, keeping the price of both fertilizer and food high relative to other commodities.

          • septimar says:

            “Reserves, the numbers that Grantham is using, are the deposits that we know where they are, have drilled and tested them, we know how to extract and process them using current technology and we also know that we can make a profit doing so. They are the known known: and yes, this really is the number that Grantham is using.

            Resources is a very different number. This is a combination of the unknown knowns and the known unknowns described above. For potash?“
            Estimated world resources total about 250 billion tons.

            At the current usage rate of 33 million tonnes a year that gives us an over 7,000 year supply. For phosphate rock?

            “World resources of phosphate rock are more than 300 billion tons.
            At the 190 million tonne a year usage, a 1,500 years supply.”

            It’s below the lengthy excerpt.

          • wysinwyg says:

            So as I said, the 1500 and 7000 year figures are assuming: 1) no increase in demand, 2) magical technology that can usefully isolate phosphate regardless of how low the concentration is.

            Given how weak Worstall’s argument is, I don’t really see how the condescending tone of the article is justified.  Gives me a sense that Worstall is posturing rather than engaging in good-faith criticism.

  17. bengee says:

    Business Insider, despite the convincing name, is a totally fake news outlet.

    If you follow the links at the end of the page you get gems like “The housing market is going to collapse” from 2010, or a list of countries that might have food riots which includes Hong Kong.

    News flash! Malthus was fake in 1798! “The Population Bomb” was fake in the 1960s. Peak oil was fake ten years ago.  It has always been fake. It sounds good to Americans because we’re probably the best equipped for the mass genocide business. It’s a lot easier to understand how increasing human demand drives up prices than how human innovation increases the supply. But it does, every single year.

    It’s even in those charts: you just have to read the actual chart instead of reading the chart’s linkbait disclaimer.

    The world’s most important resource is actually the ingenuity of human beings.

    • headcode says:

      It’s not clear to me how peak oil can be fake.  It is a finite resource and sooner or later we will hit peak production.  It’s only a matter of time.  It doesn’t seem likely that we will innovate or invent our way out of the fallout of that since while oil is still available and cheap there is not enough economic incentive to develop reliable alternatives, making the inevitable crash all the more catastrophic.

      • Peter Erwin says:

        Australian economist John Quiggin pointed out that in many ways what’s more relevant is oil consumption *per person*, and if you use that metric the world passed “peak oil” back around 1980 without any catastrophe:

        http://johnquiggin.com/2011/08/05/peak-oil-point-falls-flat/
        “Given the growth of demand in Asia, consumption per person in the countries that were already rich in 1980 has fallen much faster. Meanwhile living standards have risen substantially[2], unconstrained by declining consumption per person of oil, and of energy more generally.”

        • wysinwyg says:

           Very few people are arguing peak oil will be or would be a catastrophe, so Quiggin could be right without Grantham being wrong.

          Grantham’s real case — which the “rebuttals” conveniently ignore — is that we’re entering a new era in economic history.  The last era was one of abundance in which easily accessed resources entered into a feedback loop with extraction technologies keeping supply ahead of demand with respect to all major commodities.  Grantham argues (more rigorously in the quarterly letters than in the collection of charts) that we’re seeing a fundamental change across many important commodities — that excess production is no longer keeping up with excess demand.

          The more knowledgeable peak oil commentators tend to talk about slow declines rather than catastrophes.  Slow declines have a lot more historical support as well.  Such a decline wouldn’t mean mass starvation — it would mean increased rates of starvation at the margins of the world economy where starvation is already fairly common and a slowly depreciating standard of living everywhere else.  One would also expect the decline to be uneven where some populations have the resources and military might to appropriate resources more effectively than other populations.

        • Antinous / Moderator says:

          Australian economist John Quiggin pointed out that in many ways what’s more relevant is oil consumption *per person*, and if you use that metric the world passed “peak oil” back around 1980 without any catastrophe:

          Not sure how you can say that with a straight face when world population has grown by more than 50% since then.

          • onepieceman says:

            Which part of *per person* is hard to understand?

          • Antinous / Moderator says:

            Which part of “per person” is even marginally relevant when the number of persons has increased by three billion?

          • onepieceman says:

            It’s extremely relevant.
            The argument is couched in economic terms. In a nutshell, it says that commodity prices are going up, we have to buy commodities, therefore we will have to pay more, therefore we’re all screwed. This is arithmetically incomplete. In addition to looking at the price (which is paid by each person), you have to look at the utilisation *per person* so that you can meaningfully calculate the overall cost to each person.
            If a commodity price doubles, but my usage of it more than halves (without inconveniencing me), I, and everyone else, end up better off (economically speaking), not doomed, as implied by the article. So one has to look at utilisation per person as well as price to get the full picture. I thought this was a very relevant and useful point to introduce into the debate.

    • wysinwyg says:

       Umm, no, Malthus was not “fake”.  Malthus’ only problem is that he did not have a crystal ball with which he could see the invention of the Haber process in the 19th century.  The Haber process is a method to derive ammonium from atmospheric nitrogen; ammonium can then be (and is) processed into fertilizer.  There was no Malthusian catastrophe in the 19th century because we found a way to convert fossil fuels into food calories.

      Grantham has been making his case in the quarterly letters he releases to his company and on the internet for years.  Always data-based, always well-cited.  If you have a problem with Business Insider take a look at some of his quarterly letters.

      Your faith in the power of technology to save us no matter what is a religious belief, not based in facts about the real world.

      • bengee says:

         Ah yes, Malthus was not fake.

        He just made predictions that have failed to work out for the last two hundred odd years.

        But one day!

        I have much more faith in what happened yesterday happening again today than I do an ancient philosopher’s dream coming true. I guess its why I haven’t put together my Rapture Bugout kit yet.

        • wysinwyg says:

          He made predictions that only applied under a certain set of conditions.  All science makes predictions that only apply under a certain set of conditions.

          His predictions were incorrect as a result of changing conditions.  This routinely happens in science.

          But “incorrect” and “fake” are not synonyms, and Malthus was only “incorrect” insofar as his model made assumptions that ceased to apply several decades later.

          You might as well argue Newton was “fake” for failing to account for the precession of the perihelion of Mercury.

          It’s hilarious to me that you have so much faith in the power of technology to solve all earthly problems despite a deep ignorance of how science works in the first place.

          • bengee says:

             Dude, Newton was fake.  Einstein was less fake. Godel kept it real.

            The reification of science is a bummer. The joy of science is that it is always contingent, an endless stream of hype that touches reality, then diverges, making room for the new.

          • wysinwyg says:

            I agree with your second para absolutely.  The first para contains a bizarre usage of the word “fake” and implies a poor understanding of the distinction between physical science and pure mathematics. (When NASA engineers want to put a satellite in orbit, whose theory do they use to calculate? Newton’s, Einstein’s, or – giggle – Goedel’s?)

            “It’s a lot easier to understand how increasing human demand drives up prices than how human innovation increases the supply. But it does, every single year.”

            The reification of technology is also a bummer. Maybe you could get over it by taking a somewhat less contemptuous view of the basic science on which it’s based.

  18. class_enemy says:

    All these charts showing commodity price inflation measured in dollars apparently fail to take into account the unquenchable flow of Monopoly money dollars over the past decade, created by the investment banking industry and the Federal Reserve, with total complicity of both major American political parties.

    I tend to the conclusion that it’s not too few commodities, it’s too much money looking for a place to go.

  19. corydodt says:

    Whenever I see a phrase to the effect of “We all need to adjust our behavior to this new environment.” I check completely out of the argument.

    We’re still human. We’ll continue to be human. Behavior won’t change. Something else has to change. Probably a discovery of some kind, maybe economics.

    • PaulDavisTheFirst says:

      this is ridiculous. our behaviour today, on a daily/weekly/monthly/annual/lifetime basis, is VERY different from what it was 100 years ago. we do different things, we expect different things, we want different things (to some extent), we eat different things, we have different diseases (to some extent). you can argue that its all technologically and economically driven rather than personal choice, and you’d probably be right. but its still humans changing, adjusting their behaviour to a new environment.

  20. Cowicide says:

    We’re Headed For A Disaster Of Biblical Proportions

    Or is that just a linkbait headline of biblical appropriations?

    • Antinous / Moderator says:

      I used to have a boss who would make less-than-helpful suggestions. I would just look at her and say, “Fire will rain from the sky, and blood will run across the land in rivers.”

  21. jbond says:

    Beginning to get tired of writing this, but it’s time to go back and re-read “The Limits To Growth”[1]. ISTM that the question is which decade and century the corrections come, not if. However I’ve been waiting for the axe to fall for 40 years now and I still don’t know if it’s my kids or their grandchildren that will have to deal with it.

    [1]Key take out:- In an exponential growth system if the resources running out don’t get you, the pollution will.

  22. Matt Drew says:

    These kinds of predictions show up every few years, and are consistently disproved by reality soon afterwards. Their analysis is always flawed, because they never account for two things: human ingenuity and the historical record of how the market actually works when permitted. And ironically, the modern pronouncements of doom inevitably come from the very people who should be pleased with the outcome!

    How far do you think the price of oil will have to rise before electric vehicles become economically profitable? Not very far, and it’s getting lower every year. How far does the price of coal or natural gas have to rise before PV becomes profitable? A few cents per kwh? The simple fact is that when some resources run low and the price increases due to constricted supply, this sends the exact signal the world needs to find alternatives … when the market is allowed to operate freely and respond to price signals. And now that there are seven billion of us, do you really think we’re short on the one thing that we really need in that instance – human brainpower? Heck, we already have the answers to the shortage of oil ready to go, and they are cleaner and more sustainable!

    What you really should be focusing on is the fools in government who think that the solution is protectionism, tariffs, and forcing people to do what they think is best – just like this guy. If we are prevented from moving things where they need to be and trading amongst ourselves to obtain what we need, people will indeed starve – as they do today. You only need look at the history of American sugar subsidies and tariffs and their relation to poverty in the Carribbean to understand the destructive power of anti-economic policies.

    • PaulDavisTheFirst says:

      although i broadly agree with what you’ve written here, there is still the fundamental question: do you believe that there are any limits to growth other than human ingenuity?

      • onepieceman says:

        I don’t. Why should there be? Of course it may be that our ingenuity is stifled in some way, so I’m not saying we’re guaranteed to survive, but we are much more likely to do so if we carry on growing.

    • bigmike7 says:

      Currently, most electric cars are powered by fossil fuels, through an inefficient chain of energy conversions. Only government subsidies make the cars themselves feasible for the market. And cheaper (subsidized) electrical charging for those with electric vehicles makes the electricity affordable. So, there is some mistake in your thinking that government is somehow in the way of moving toward green technologies. Also, there is a mistake in thinking that cars must somehow necessarily be part of our future. Is it not possible that the market will rule out cars? 

      I might be making assumptions, but I find that free-market miracle people like you point to the glories of, for example, cheap goods flooding our country via Walmart, conveniently forgetting that China is the very model of an economy that exists only through government subsidies and government backed human rights violations. It’s also easy to forget that our “free market” cheap bananas and coffee are supported by governments that murder labor organizers. “Free” depends on your perspective.

      There is no guarantee that the answer to peak oil will miraculously appear simply because we need it. That’s magical thinking, isn’t it? How I can people continue to parrot that line without seeing that it is magical? I’ve seen a need for anti-gravity or time-travel technology for years now, and it hasn’t appeared.

  23. As soon as I read the line “biblical proportions” I kinda thought he was blowing a bit of smoke up our collective behinds. Sorry, it’s the atheist in me.

  24. Brad Bell says:

    Most of our problems are artificial and politically solvable. The job of those in power is to convince us the problems are natural and politically intractable.

    Food Speculation
    http://youtu.be/rpM9XxJ-vo4

    When economic activity is reduced to gaming existing systems and institutions until they break – like food commodities – for the benefit of 0.001% and at a desperate cost for 99.9%, we can expect political economic change.

    I have recently been struck by how solar energy is similar to computers. While solar can be industrialised, it is one of the few energy sources that can be democratised. The product is not energy, it’s hardware. You put panels on your roof. You are not dependent on an industry. It is estimated solar energy will be competitive with fossil fuels in 4-5 years. Solar is increasingly commoditised. Prices are going down, economies of scale are kicking in, thanks to China and Germany, and the technology is becoming increasingly efficient and powerful. As I said, it’s a bit like computers.

    • Marko Raos says:

      Agree, I know of at least three mega-technological projects that are perfectly achievable with today’s technology and at a relatively low cost. Completing just one of them would solve all current material problems of humanity and make current 1st world lifestyle available to up to 20 billion humans on Earth alone. Alas, they all require abolition of current economic system and setting up of what can only be described as “benevolent global communist state.” So, where does this leave us?

  25. Greg Van Antwerp says:

    What exactly does Biblical Proportion mean? And, is ‘portion’ a portion of Proportion? I love article, blog, you tube video titles -If you hold your ear up to the Internet you can almost hear the hammers of the wordsmiths pounding away…What will next week’s article be not “6 reasons sex will dry up and how you can sop it!” (yes, ‘sop’ was intentional). 
    (No strike against BB, I am referring to the baiting so prevalent on the internet everywhere.) 

    • Peter Erwin says:

      Obviously, a “disaster of Biblical proportions” is one which is bad for small, bronze- and early iron-age agricultural and pastoral societies, like those which feature prominently in the Bible…

  26. ifriit says:

    One thing I think is missed by people that promote commodity constraints as a looming threat is that they actually put money in the pockets of commodity investors, and as such should be viewed with more suspicion. Disseminating disinformation and convincing people that a commodity is more constrained than it actually is is a great way to drive up that commodity’s price. This is not intended as a disproof, but it seems to me that people take these arguments more seriously than they would otherwise, seeing the evangelists as particularly altruistic.

  27. 5ive says:

    Where is the chart that shows the price of whale oil from 1800 to present?  It’s becoming increasingly hard for me to find reasonably priced whale oil.  If we don’t find some other way to illuminate the night, the price of this commodity will surely result in us living in the dark!

  28. Tom says:

    Oopa Grantham Style.

  29. Ryan Lenethen says:

    Pretty much any organism given pretty much any enviroment will continue to expand its population, until it runs out of food, at which point there is a die off, and given time equiliberm is achieved. In the case of humans we just keep coming up with ideas for continued growth. Should those ideas ever become ineffective, see above. One could cite that another differance is the fact that we have the ability to think and reason, and as such would be able to communicate and control our growth, and thus achieving equiliberm prior to the afore mentioned die off. Given history, the ability to think and reason might not be that big of a factor without the ability to effectively coordinate our efforts.

    Anyway all of this is pretty primary stuff, common sense if you will. The scary part, is that because we have use “atrifical” means to enable continued population growth, and that because those means are mostly things that we will eventually run out of, the repercussions could be all the more dire. That is to say the organism that achieved 120% population will experiance a 20% decline before it stabalizes, whereas for example one that has 1000% population…

    • Marko Raos says:

      Incorrect, sir. Many higher animal species do have mechanisms which regulate their population, independent of direct external influences. Humans have been proven again and again throughout history, to decrease their natality rate proportional to individual standard of living. And if that doesn’t work (in low civilization/high population instances, for example) there is always war as a (gasp) inherently human natural mechanism to keep the pesky hairless mammal population down.
      While we do belong to animalia, just like bacteria, it doesn’t mean we ARE nothing but bacteria. A common malthusian logical flaw, i believe….
      As for “finite” material resources.. We really don’t know what their true limits are, as we are too busy playing childish power games between ourselves. (You know, the “I can eat while you can’t” and “Bend over and I’ll give you a banana.” kind of games that you can play only when there are not enough bananas to go around but aren’t they so much fun)

  30. AbleBakerCharlie says:

    I think we need to get something straight about Malthus in all this. He wasn’t “wrong,” per se. His relevant realization wasn’t some specific prediction that everyone would starve to death on day X- it was the recognition that a given organism or population of organisms could produce more offspring on day X than could be fed when they were all grown up on day Y- which was a critical cog in Darwin figuring out natural selection. And it’s absolutely true that the carrying capacity of an environment can be changed by the parameters of the creatures in question-whether technological or biological. But namicthat’s not an infinite process. Diminishing returns are encountered. Innovations take energy. Thermodynamics tends to get pissed sooner than later- and cracks about how we didn’t run out of whale oil because we found something better neglects a) how we still managed to nearly run the hell out of whales, decades after the bulk of said transition b) the fact that running the world on mineral rather than whale oil has been a comparable brief experiment with some notable side effects in its brief tenure and c) it would have been a stupid bet before people started digging oil wells that you could switch what an economy ran on- and simply from an accumulation of knowledge standpoint, we’re more likely to have all the angles figured out. There’s never been a generation in history more likely to be correct about the outcome of physical events, and to have the means to address physical concerns, and our best bets include a measure of concern. I believe wholeheartedly that we can have a verdant, rich, high tech future, but it’s going to take more will than “tech will deliver.”

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