But he urges us to not cling to a simple-minded, fixed-resources theory and assert that resources will become exhausted because they are limited.
He then states his own theory to counter the limited resource theory: "More people and increased income expand the demand for raw materials as well as finished products. The resulting actual and expected shortages force up prices of the natural resources. This causes 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 (increased prices trigger the search by business and scientists for new ways to satisfy the demand and sooner or later new sources and innovative substitutes are found)...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 (new discoveries lead to cheaper natural resources than existed before this process began, leaving humanity better off than if the shortages had not appeared. Increased productivity of land and the development of new sources of energy moving from wood to coal to oil to nuclear power exemplify this process)" (Ultimate Resource, p.59, mixed with interspersed quotes from Life Against the Grain, p.251). The term 'finite', says Simon, is not only inappropriate but is downright misleading when applied to natural resources (p.62). Besides, we can now create entirely new materials to replace older resources. Ceramics is one example of new knowledge putting an end to past generations worries about running out of metals (p.63).
So Simon is right to counter this limited resource fallacy and the related depreciation of humanity (greedy, selfish people are consuming too much and exhausting resources and destroying the planet in the process) with the fact that the ultimate resource is the human mind with its unlimited creative potential. The unlimited nature of the human mind (and the basic goodness of humanity) makes the issue of resource limitations a falsely posed problem. The human mind will find solutions to any resource problems that arise because human ingenuity and creativity are unlimited and, as history has proven over past millennia, people have always found ways to continue to improve life and to raise living standards. Human minds created pounds of sand (fibre optics) to replace tons of copper. Human minds created high-yield strains of cereals that made nonsense of Paul Erhlich's prophecies of famine (Peter Huber in Hard Green). And human minds will continue to develop new resources to replace old ones (nuclear and solar to replace hydrocarbons or as Arthur Clarke predicted, unlimited supplies of dark energy). Simon calls this the principle of 'infinite substitutability' (Ultimate Resource, p.49).
The undergirding force behind the progress here is that people are in net terms more creators than destroyers.
Wilfred Beckerman similarly argues that there are no limits to natural resources. He says, "In short, the main reason why we will never run out of any resource or even suffer seriously from any sudden reduction in its supply is that whenever demand for any particular material begins to run up against supply limitations, a wide variety of economic forces are set in motion to remedy the situation. These forces start with a rise in price, which, in turn leads to all sorts of secondary favorable feedbacks- notably a shift to substitutes, an increase in exploration, and technical progress that brings down the costs of exploration and refining and processing as well as the costs of substitutes" (p.13, A Poverty of Reason).
Beckerman, as does Simon, also provides lists of natural resource reserves which show how these supposedly limited resources have expanded, often massively, over history.
Too often we can find ourselves caught up in the fallacy of what James Payne calls "presentism"- the tendency to assume that the events of the present are larger, more important, or more shocking than the past (History of Force, p.8). Humanity has been through all this resource alarmism before, but with less wealth people in the past were not as prepared to resolve such problems. They did anyway. We are better equipped to find solutions now, and with ongoing economic development future generations will be even more capable of resolving such issues. So human progress will continue. The longest of long term trends (the entirety of human history) affirms this trajectory of progress. We will not run out of energy but will discover ever larger supplies of energy to fuel our ongoing creation of more order in the world and wherever else we choose to live.
"As I have gotten older ... I believe that progress is not only possible but inevitable and probably irreversible by now" (Simon, A Life Against The Grain, p.342).
Wendell Krossa
and everybody has a right to it, even if it's in another country
as it were...
