Julian Simon’s 1996 masterpiece, The Ultimate Resource 2 (pages 42-43)

Cafe Hayek.

There is an almost insuperable difficulty in the definition of available “copper,” “oil,” and so on, because there are many different grades of each resource in places that vary in difficulty of extracting the resource, and because . . . the amounts at low concentrations (such as the quantities of metals on the sea bottom and in seawater) are extraordinarily large in contrast to the quantities we usually have in mind (the “proven reserves”). What’s more, we constantly create new supplies of resources, in the sense of discovering them where they were thought not to exist. (In the past, the U.S. Geological Survey and others thought that there was no oil in California or Texas.) Often, new supplies of a resource come from areas outside of the accustomed boundaries of our system, as resources from other continents came to Europe in past centuries and as resources may in the future be brought from the sea or from other planets. New supplies also arise when a resource is created from other materials, just as grain is grown and nuclear fuel is “bred.”

 …. In exactly the same way that we manufacture paper clips or hula-hoops, we create new supplies of copper. That is, we expend time, capital, and raw materials to get them. Even more important, we find new ways to supply the services that an expensive product (or resource) renders.

Julian Simon

Julian Simon web.

Earth day: Spiritually uplifting, intellectually debased - Feliz día de la tierra by Julian Simon.

Julian Simon in Cafe Hayek.

The ultimate scholar by Donald Boudreaux.

Julian Simon Remembered: It's A Wonderful Life. Stephen Moore.

Julian Simon Remembered: It's A Wonderful Life. Stephen Moore. 1998.

Vía Cato Institute.

Julian L. Simon, professor of business administration at the University of Maryland and distinguished senior fellow at the Cato Institute, died February 8 at the age of 65. Stephen Moore, his former research assistant, is director of fiscal policy studies at the Cato Institute.

I first met "doom-slayer" Julian L. Simon at the University of Illinois in the spring of 1980—at just the time when the environmental doomsday industry had reached the height of its influence and everyone knew the earth was headed to hell in a hand basket. We could see the signs right before our very eyes. We had just lived through a decade of gasoline lines, Arab oil embargoes, severe food shortages in the Third World, nuclear accidents, and raging global inflation. Almost daily the media were reporting some new imminent eco-catastrophe: nuclear winter, ozone depletion, acid rain, species extinction, and the death of the forests and oceans.

The Club of Rome had just released its primal scream,Limits to Growth, which reported that the earth was rapidly running out of everything. The most famous declinist of the era, biologist Paul Ehrlich, had appeared on the Tonight Show with Johnny Carson to fill Americans with fear of impending world famine and make gloomy prognostications, such as, "If I were a gambler, I would bet even money that England will not exist in the year 2000."

The Carter administration published in 1980 its multiagency assessment of the earth’s future, titled Global 2000. Its famous doom-and-gloom forecast that "the world in 2000 will be more crowded, more polluted, less stable ecologically. . . . and the world’s people will be poorer in many ways than they are today" received headlines across the nation. Malthusianism was now the official position of the U.S. government.

It was all so damned depressing. And, thanks to iconoclast Julian Simon, we now know that it was all so wrong.

It was back in the midst of that aura of gloom that by chance I enrolled in Simon’s undergraduate economics course at the University of Illinois. After the first week of the course, I was convinced that his multitude of critics were right. He must be a madman. How could anyone believe the outlandish claims he was making? That population growth was not a problem; that natural resources were becoming more abundant; that the condition of the environment was improving. That the incomes of the world’s population were rising. Simon made all of those bold proclamations and more in his masterpiece The Ultimate Resource, published in 1980. I read the book over and over—three times, in fact—and I came to the humbling realization that everything I had been taught since the first grade about population and environmental issues had been dead wrong.

The weight of the facts that Simon brought to bear against the doomsayers was simply so overpoweringly compelling that I, like so many others, became a Julian Simon fanatic. Julian was the person who brought me to Washington in 1982 to work as his research assistant as he finished his next great book (coedited with the late futurist Herman Kahn of the Hudson Institute) titled The Resourceful Earth: A Response to Global 2000.

So for more than 15 years I was privileged to occupy a front-row seat from which I watched as Simon thoroughly and often single-handedly capsized the prevailing Malthusian orthodoxy. He routed nearly every prominent environmental scaremonger of our time: from the Club of Rome, to Paul Ehrlich, to Lester Brown, to Al Gore. (After reading Earth in the Balance, Julian was convinced that Gore was one of the most dangerous men and one of the shallowest thinkers in all of American politics.)

Simon’s dozens of books and his more than 200 academic articles always brought to bear a vast arsenal of compelling data on and analysis of how life on earth was getting better, not worse. Simon argued that we were not running out of food, water, oil, trees, clean air, or any other natural resource because throughout the course of human history the price of natural resources had been declining. Falling long-term prices are prima facie evidence of greater abundance, not increasing scarcity. He showed that, over time, the environment had been getting cleaner, not dirtier. He showed that the "population bomb" was a result of a massive global reduction in infant mortality rates and a stunning increase in life expectancy. "If we place value on human life," Simon argued, "then those trends are to be celebrated, not lamented."

Simon’s central premise was that people are the ultimate resource. "Human beings," he wrote, "are not just more mouths to feed, but are productive and inventive minds that help find creative solutions to man’s problems, thus leaving us better off over the long run." As Ben Wattenberg of the American Enterprise Institute explained in his brilliant tribute to Simon in the Wall Street Journal, "Simon’s central point was that natural resources are not finite in any serious way; they are created by the intellect of man, an always renewable resource." Julian often wondered why most governmental economic and social statistics treat people as if they are liabilities not assets. "Every time a calf is born," he observed, "the per capita GDP of a nation rises. Every time a human baby is born, the per capita GDP falls." Go figure!

The two trends that Simon believed best captured the long-term improvement in the human condition over the past 200 years were the increase in life expectancy and the decline in infant mortality (see figures). Those trends, Simon maintained, were the ultimate sign of man’s victory over death.

Today, many of Julian Simon’s views on population and natural resources are so triumphant that they are almost mainstream. No one can rationally look at the evidence today and still claim, for example, that we are running out of food or energy. But those who did not know Julian or of his writings in the 1970s and early 1980s cannot fully appreciate how viciously he was attacked—from both the left and the right. Paul Ehrlich once snarled that Simon’s writings proved that "the one thing the earth will never run out of is imbeciles." A famous professor at the University of Wisconsin wrote, "Julian Simon could be dismissed as a simpleminded nut case, if his ideas weren’t so dangerous."

To this day I remain convinced that the endless ad hominem attacks were a result of the fact that—try as they would—Simon’s critics never once succeeded in puncturing holes in his data or his theories. What ultimately vindicated his theories was that the doomsayers’ predictions of global famine, $100 a barrel oil, nuclear winter, catastrophic depletion of the ozone layer, falling living standards, and so on were all discredited by events. For example, the year 2000 is almost upon us, and we can now see that the direction in which virtually every trend of human welfare has moved has been precisely the opposite of that predicted by Global 2000. By now Simon and Kahn’s contrarian conclusions in The Resourceful Earth look amazingly prescient.

The ultimate embarrassment for the Malthusians was when Paul Ehrlich bet Simon $1,000 in 1980 that five resources (of Ehrlich’s choosing) would be more expensive in 10 years. Ehrlich lost: 10 years later every one of the resources had declined in price by an average of 40 percent.

Julian Simon loved good news. And the good news of his life is that, today, the great bogeyman of our time, Malthusianism, has, like communism, been relegated to the dustbin of history with the only remaining believers to be found on the faculties of American universities. The tragedy is that it is the Paul Ehrlichs of the world who still write the textbooks that mislead our children with wrongheaded ideas. And it was Paul Ehrlich, not Julian Simon, who won the MacArthur Foundation’s "genius award."

Among the many prominent converts to the Julian Simon world view on population and environmental issues were Ronald Reagan and Pope John Paul II. Despite howls of protest from the international population control lobby, in 1984 the Reagan administration adopted Simon’s position—that the world is not overpopulated and that people are resource creators, not resource destroyers—at the United Nations Population Conference in Mexico City. The Reaganites called it "supply-side demographics." Meanwhile, in the late 1980s, Simon traveled by invitation to the Vatican to explain his theories on population growth. A year later Pope John Paul II’s encyclical letter urged nations to treat their people "as productive assets."

Simon’s theory about the benefits of people also led him to write extensively about immigration. In 1989 he published The Economic Consequences of Immigration, which argued that immigrants make "substantial net economic contributions to the United States." His research in the 1980s showed that, over their lifetimes, immigrants on balance pay thousands of dollars more in taxes than they use in government services, making them a good investment for native-born Americans. It was arguably the most influential book on U.S. immigration policy in 25 years. Sen. Spencer Abraham (R-Mich.), chairman of the Immigration Subcommittee, has credited Simon’s work with helping "keep wide open America’s gates to immigrants."

We at the Cato Institute published three of Julian Simon’s books and dozens of his articles and studies. We were always drawn to his celebration of the individual. Simon believed that human progress depended not only on creative and ingenious minds but also on free institutions. He often marveled that the only place on earth where life expectancy actually fell in the 20th century was in the Soviet Union and other East European nations during the tyranny of communism. Many of his most ardent critics were government activists who believe that the only conceivable solution to impending eco-catastrophe is ever more stringent governmental edicts: coercive population stabilization policies, gas rationing, wage and price controls, mandatory recycling, and so on.

Julian had an ebullient spirit, but from time to time he would complain to me that his writings never received the full recognition they deserved from academics. That was probably true, but I always reminded him that his work had had a more profound impact on the policy debate in Washington than that of any random selection of 100 of his academic peers combined.

Two weeks before Julian died, I was driving through central Iowa and was surprised and delighted to find gasoline selling for 89 cents a gallon. I hadn’t seen gas prices that low since before the OPEC embargo in the early 1970s. I instantly thought of Julian. It was one of those little real-world events that confirm that he was right all along.

This article originally appeared in the March/April 1998 edition of Cato Policy Report.

Entrevista a Arcadi Espada por Pablo Vergara. 02.07.2011

Muy interesante entrevista al maestro Espada.

Dejo dos respuestas interesantes:

-Hay un texto muy bonito que ahora lo tengo en la cabeza, de Julian Simon, un premio Nobel de economía. Tiene unos libros fantásticos y en uno de ellos hay una cita que dice: la gran paradoja de la sociedad es que cada vez la gente vivirá mejor, sin ninguna duda; los hijos vivirán mejor que los padres, siempre. Pero nunca jamás conseguiremos que la gente lo reconozca. Y hoy estoy dándole a Matt Ridley, que se llama El optimista racional. Un artículo de Simon dio pie a este libro, un artículo que explica por qué los hombres tenemos que ser optimistas. Más allá que nos tenemos que morir.

-Como un éxito. Y como una herida inextinguible en el corazón de la izquierda. Vamos a ver: Chile y España se parecen muchísimo. No hay experiencias… El pinochetismo que duró 17 años, 23 años en la comandancia en jefe, hasta que desaparece, esa es la única diferencia, y naturalmente la guerra civil. O sea, Chile es como homeopáticamente muy parecido, absolutamente. La transición os ha permitido salir del agujero de una manera civilizada, exactamente igual que en España, y luego está la gran cosa terrible de admitir, que el pinochetismo puso las bases de una sociedad eficiente. Bueno. Que las hubiera puesto Allende, puede ser. No lo sé si las hubiera puesto Allende. Esta es la misma pregunta que nos hacemos con la república española. Cuando nos decimos “Claro, es que Franco puso las bases de una sociedad eficiente”. Cierto, indiscutible. Pero qué hubiera sido esto la república. No lo sabemos. Tampoco sabemos si la república española de haber seguido se hubiera convertido en un régimen comunista y España hubiera sido un país satélite. No lo sabemos.

Earth day: Spiritually, uplifting, intellectually debased L. Simon

Aquí en español.

Earth day: Spiritually, uplifting, intellectually debased.

by Julian L. Simon.

April 22 [1995] marks the 25th anniversary of Earth Day. Now as then its message is spiritually uplifting. But all reasonable persons who look at the statistical evidence now available must agree that Earth Day’s scientific premises are entirely wrong.

During the first great Earth Week in 1970 there was panic. The public’s outlook for the planet was unrelievedly gloomy. The doomsaying environmentalists–of whom the dominant figure was Paul Ehrlich–raised the alarm: The oceans and the Great Lakes were dying; impending great famines would be seen on television starting in 1975; the death rate would quickly increase due to pollution; and rising prices of increasingly-scarce raw materials would lead to a reversal in the past centuries’ progress in the standard of living.

The media trumpeted the bad news in headlines and front-page stories. Professor Ehrlich was on the Johnny Carson show for an unprecedented full hour–twice. Classes were given by television to tens of thousands of university students.

It is hard for those who did not experience it to imagine the national excitement then. Even those who never read a newspaper joined in efforts to clean up streams, and the most unrepentant slobs refrained from littering for a few weeks. Population growth was the great bugaboo.

Every ill was the result of too many people in the U. S. and abroad. The remedy doomsayers urged was government-coerced birth control, abroad and even at home.

On the evening before Earth Day I spoke on a panel at the jam-packed auditorium at the University of Illinois. The organizers had invited me for “balance,” to show that all points of view would be heard. I spoke then exactly the same ideas that I write today; some of the very words are the same.

Of the 2,000 persons in attendance, probably fewer than a dozen concluded that anything I said made sense. A panelist denounced me as a religious nut, attributing to me weird beliefs such as that murder was the equivalent of celibacy. My ten-minute talk so enraged people that it led to a physical brawl with another professor.

Every statement I made in 1970 about the trends in resource scarcity and environmental cleanliness turned out to be correct. Every prediction has been validated by events. Yet the environmental organizations and the Clinton administration–especially Vice President Al Gore, the State Department, and the CIA –still take as doctrine exactly the same ideas expressed by the doomsayers in 1970, despite their being discredited by recent history. And the press overwhelmingly endorses that viewpoint.

Here are the facts: On average, people throughout the world have been living longer and eating better than ever before. Fewer people die of famine nowadays than in earlier centuries. The real prices of food and of every other raw material are lower now than in earlier decades and centuries, indicating a trend of increased natural-resource availability rather than increased scarcity. The major air and water pollutions in the advanced countries have been lessening rather than worsening.

In short, every single measure of material and environmental welfare in the United States has improved rather than deteriorated. This is also true of the world taken as a whole. All the long-run trends point in exactly the opposite direction from the projections of the doomsayers. There have been, and always will be, temporary and local exceptions to these broad trends. But astonishing as it may seem, there are no data showing that conditions are deteriorating.

Rather, all indicators show that the quality of human life has been getting better. As a result of this evidence of improvement rather than degradation, in the past few years there has been a major shift in scientific opinion away from the views the doomsayers espouse. There now are dozens of books in print and hundreds of articles in the technical and popular literature reporting these facts.

Responding to the accumulating literature that shows no negative correlation between population growth and economic development, in 1986 the National Academy of Sciences published a report on population growth and economic development prepared by a prestigious scholarly group. It reversed almost completely the frightening conclusions of the previous 1971 NAS report. The group found no quantitative statistical evidence of population growth hindering economic progress, though they hedged their qualitative judgment a bit. The report found benefits of additional people as well as costs. Even the World Bank, the greatest institutional worrier about population growth, reported in 1984 that the world’s natural resource situation provides no reason to limit population growth.

A bet between Paul Ehrlich and me epitomizes the matter. In 1980, the year after the tenth Earth Day, Ehrlich and two associates wagered with me about future prices of raw materials. We would assess the trend in $1000 worth of copper, chrome, nickel, tin, and tungsten for ten years. I would win if resources grew more abundant, and they would win if resources became scarcer. At settling time in 1990, the year after the twentieth Earth Week, they sent me a check for $576.07.

A single bet proves little, of course. Hence I have offered to repeat the wager, and I have broadened it as follows: I’ll bet a week’s or a month’s pay that just about any trend pertaining to material human welfare will improve rather than get worse. You pick the trend–perhaps life expectancy, a price of a natural resource, some measure of air or water pollution, or the number of telephones per person– and you choose the area of the world and the future year the comparison is to be made. If I win, my winnings go to non-profit research.

I have not been able to close another deal with a prominent academic doomsayer. They all continue to warn of impending deterioration, but they refuse to follow Professor Ehrlich in putting their money where their mouths are. Therefore, let’s try the chief “official” doomsayer, Vice President Al Gore. He wrote a best-selling book, Earth in the Balance, that warns about the supposed environmental and resource “crisis.” In my judgment, the book is as ignorant and wrongheaded a collection of cliches as anything ever published on the subject.

So how about it, Al? Will you accept the offer? And how about your boss Bill Clinton, who supports your environmental initiatives? Can you bring him in for a piece of the action?

It is not pleasant to talk rudely like this. But a challenge wager is the last refuge of the frustrated. And it is very frustrating that after 25 years of the anti-pessimists being proven entirely right, and the doomsayers being proven entirely wrong, their credibility and influence waxes ever greater.

That’s the bad news. The good news is that there is every scientific reason to be joyful about the trends in the condition of the Earth, and hopeful for humanity’s future, even if we are falsely told the outlook is grim. So Happy Earth Day.

Feliz Día de la Tierra por Julian L. Simon.

Traducción de un artículo excepcional de Julian Simon, por Arcadi Espada.


Here in English.

Suscribo todas y cada una de las ideas que se pueden extraer del texto. Siempre tienen más predicamente los agoreros, y nunca, pero nunca, sucede lo que dicen.

Destacar este párrafo:

Todas las afirmaciones que hice en 1970 sobre la tendencia de la escasez de recursos y la limpieza ambiental resultaron ser correctas. Todas las predicciones han sido refrendadas por los acontecimientos. A pesar de que las organizaciones ambientales y la administración Clinton —especialmente el vicepresidente Al Gore, el Departamento de Estado y la Cia— siguen adoptando como doctrina las mismas ideas expresadas por los agoreros de 1970, aunque hayan sido desacreditados por la historia reciente. Y la prensa promociona de forma abrumadora esa postura.

Feliz Día de la Tierra

Por Julian L. Simon.

El 22 de abril [de 1995] marca el 25 aniversario del Día de la Tierra. Hoy, como entonces, su mensaje es espiritualmente edificante. Pero todas las personas razonables que miren las pruebas estadísticas estarán de acuerdo en que las premisas científicas del Día de la Tierra son totalmente erróneas.

En la primera gran Semana de la Tierra de 1970 había pánico. La visión que el público tenía del planeta era absolutamente fatalista. Los ecologistas catastrofistas —de los que Paul Ehrlich era la figura dominante— dieron la alarma: los océanos y los Grandes Lagos se secarían, se verían inminentes hambrunas por televisión al empezar 1975, la tasa de mortalidad crecería rápidamente a causa de la polución, y los precios en aumento de las cada vez más escasas materias primas harían invertir el curso del progreso en la calidad de vida de los últimos siglos.

Los medios pregonaron a los cuatro vientos las malas noticias en titulares y artículos de portada. El profesor Ehrlich estuvo en el show de Johnny Carson dos veces, insólitamente durante todo el programa. Se daban clases por televisión a decenas de miles de estudiantes universitarios.

Para quienes no lo vivieron es difícil imaginar la excitación nacional de entonces. Incluso aquellos que jamás leían un periódico se sumaron a los esfuerzos por limpiar los arroyos, y los patanes más impenitentes se abstuvieron de tirar la basura durante algunas semanas. El crecimiento demográfico era la gran pesadilla.

Todos los males eran resultado de demasiada gente en Estados Unidos y el extranjero. El remedio que pedían los agoreros era el control de la natalidad auspiciado por el gobierno, en el extranjero y en casa.

La tarde antes del Día de la Tierra intervine en un panel en el auditorio a rebosar de la Universidad de Illinois. Los organizadores me habían invitado para «compensar», para demostrar que podían escucharse todos los puntos de vista. Entonces dije las mismas ideas que hoy escribo, incluso algunas palabras son las mismas.

De las 2.000 personas que asistieron, probablemente menos de una docena sacó la conclusión de que lo que decía tenía sentido. Un panelista me tildó de majara religioso, atribuyéndome extrañas creencias, como que el asesinato era el equivalente del celibato. Mi charla de diez minutos enfureció tanto a la gente que dio lugar a una pelea física con otro profesor.

Todas las afirmaciones que hice en 1970 sobre la tendencia de la escasez de recursos y la limpieza ambiental resultaron ser correctas. Todas las predicciones han sido refrendadas por los acontecimientos. A pesar de que las organizaciones ambientales y la administración Clinton —especialmente el vicepresidente Al Gore, el Departamento de Estado y la Cia— siguen adoptando como doctrina las mismas ideas expresadas por los agoreros de 1970, aunque hayan sido desacreditados por la historia reciente. Y la prensa promociona de forma abrumadora esa postura.

Aquí están los hechos: de media, la gente en todo el mundo ha estado viviendo más años y comiendo mejor que nunca antes. Menos gente muere de hambre hoy en día que en siglos anteriores. Los precios reales de los alimentos y de todas las otras materias primas son más bajos ahora que en décadas y siglos anteriores, indicando una tendencia al alza en la disponibilidad de recursos naturales, y no hacia la escasez creciente. La polución del agua y del aire de los países avanzados ha ido disminuyendo, no empeorando.

En resumen, todos y cada uno de los indicadores de bienestar material y medioambiental de Estados Unidos han mejorado en vez de haberse deteriorado. Lo mismo sucede con el mundo considerado en su conjunto. Todas las tendencias a la larga apuntan exactamente en dirección opuesta a los pronósticos de los agoreros. Siempre ha habido, y siempre habrá, excepciones locales y temporales en estas tendencias generales. Por asombroso que parezca, no hay datos que demuestren que las condiciones están en deterioro.

Al contrario, los indicadores demuestran que la calidad de la vida humana ha ido mejorando. Como resultado de la evidencia de la mejoría, y no de la degradación, se ha producido en los últimos años un importante cambio en la opinión científica, alejado de las posturas que los agoreros propugnan. Ahora hay docenas de libros impresos y cientos de artículos en la literatura técnica y popular que reportan estos hechos.

En respuesta a la literatura acumulada que no demostraba una correlación negativa entre el crecimiento de la población y el desarrollo económico, la Academia Nacional de Ciencias (NAS) publicó en 1986 un informe sobre el crecimiento demográfico y el desarrollo económico preparado por un prestigioso grupo académico. Revocaba casi por completo las aterradoras conclusiones del informe previo de la NAS de 1971. El grupo no encontró pruebas estadísticamente cuantitativas de que el crecimiento demográfico dificultara el desarrollo económico, aunque eludió un poco su juicio cualitativo. El informe halló los beneficios de la población adicional, así como los costes. Incluso el Banco Mundial, el gran preocupado institucional por el crecimiento demográfico, informó en 1984 de que la situación mundial de los recursos naturales no ofrecía motivos para limitar el crecimiento de la población.

Una apuesta entre Paul Ehrlich y yo tipifica el asunto. En 1980, el año antes del décimo Día de la Tierra, Ehrlich y dos asociados apostaron conmigo sobre los precios futuros de las materias primas. Calcularíamos la evolución de 1.000 dólares de cobre, cromo, níquel, estaño y tungstenio durante diez años. Yo ganaba si los recursos crecían en mayor abundancia, y ganaban ellos si los recursos se volvían más escasos. En la fecha establecida de 1990, el año antes del vigésimo Día de la Tierra, me enviaron un cheque de 576.07 dólares.

Una sola apuesta es poca prueba, naturalmente. Así que me he ofrecido a repetir la apuesta, y la he ampliado a lo siguiente: Me apuesto el sueldo de una semana, o de un mes, a que casi cualquier tendencia relativa al bienestar material humano irá a mejor en vez de a peor. Se puede escoger la tendencia —esperanza de vida, precio de un recurso natural, algún indicador de polución del aire o del agua, o el número de teléfonos por persona— y se puede elegir el área del mundo y el año futuro en que se hará la comparación. Si gano yo, lo que gane irá a una investigación sin fines lucrativos.

No he sido capaz de cerrar otro trato con un académico agorero de prominencia. Todos siguen advirtiendo del inminente deterioro, pero se niegan a seguir al profesor Ehrlich y predicar con el ejemplo.

Por tanto, probemos con el agorero «oficial» en jefe, el vicepresidente Al Gore. Ha escrito un bestseller, La Tierra en juego, que advierte sobre la supuesta «crisis» de recursos y medio ambiente. A mi juicio, el libro es una colección de clichés tan ignorante y equivocada como cualquier otra cosa que se haya publicado sobre el asunto.

Así que, ¿cómo lo ves, Al? ¿Aceptarías la oferta? ¿Y tu jefe Bill Clinton, que apoya tus iniciativas medioambientales? ¿Podrías traerle a por su parte del pastel?

No es agradable hablar con esta rudeza. Pero la apuesta del desafío es el último refugio del frustrado. Y es muy frustrante que, tras 25 años de que el antipesimismo se haya probado por completo correcto, y que los agoreros se hayan probado equivocados, su credibilidad y su influencia sean mayores que nunca.

Esas son las malas noticias. Las buenas es que existen todas las razones científicas para estar contentos con la evolución de las condiciones de la Tierra, y esperanzados con el futuro de la humanidad, aunque se nos diga falsamente que las perspectivas son deprimentes.

Así que, ¡Feliz Día de la Tierra!

Lecturas interesantes 25 de febrero de 2011 (y II)

China's Secret Weakness by Paul Johnson.

This is nonsense. So long as America retains its freedom and thus its unique powers of innovation, it will continue to lead. Besides, China's elite is too scared to follow in the path of freedom because to do so would risk unity, threatening disintegration and a return to the terrible days of warlords and civil war, as in the 1920s.

Moreover, China has secret weaknesses. Its most serious: gambling and drug addiction. China's new prosperity is already producing a rapid expansion of the country's international gambling class, not to mention an appreciable increase in the number of drug addicts.

***

Agnostics for Pacifism by Bryan Caplan.

Bryan CaplanAre they right to claim credit? I don't know - and neither do they. The hard truth is that predicting the effects of war is extremely difficult. If one man's suicide can topple multiple Middle Eastern governments, Ghassan might be right about Iraq. In foreign policy, sometimes you sit back and problems solve themselves. Sometimes you act and create a massive domino effect. And sometimes the dominoes fall the wrong way.

By itself, I freely admit, extreme uncertainty is a double-edged sword. The consequences of war might be worse than you thought; they might be even better. But as I've argued in my common-sense case for pacifism, pacifists just need to add the weak moral premise that "before you kill innocent people, you should be reasonably sure that your action will have very good consequences." This plausible premise, combined with the uncertainty of foreign affairs, creates an almost insurmountable presumption against war.

***

Civil Societies Cannot be Built – They Must Emerge by Don Boudreaux‏.

William Kristol argues that “American principles” require Uncle Sam to intervene more vigorously – with force, if necessary – in the revolutions now sweeping through the Middle East (“Obama’s moment in the Middle East – and at home,” Feb. 23).

I disagree. While we should cheer for liberalization to grow and spread throughout the Middle East, American principles counsel our government not to interfere. One of these principles, after all, is that government (even our own) is an inherently dangerous agent best kept on as short a leash as possible. Another of these principles is that top-down social engineering is bound to have undesirable unintended consequences – a fact that is no less true when the social engineers are headquartered in the Pentagon and the State department as when they are headquartered in the Department of Health and Human Services and the Department of Education. The same government that Mr. Kristol so often, and rightly, criticizes for making a mess of matters here at home is unlikely to become a shining example of efficiency, rectitude, and Solomaic wisdom in foreign lands.

***

The Ultimate Resource: You by McGlothlin Andrew.

If you’ve spent any time in class with Dr. Gillette, you most likely have heard of the concept of knowledge-value. This idea, from Taichi Sakaiya’s book The Knowledge Value Revolution: or a History of the Future, reminded me very much of a discussion I had heard about Julian Simon’s idea of the ultimate resource, human ingenuity. The similarity between these ideas seemed striking, and I think this twist on the familiar concept of knowledge-value gives us an interesting way to understand its fundamental importance.

First, I would like to start by defining Knowledge-Value for anyone who is not familiar with the concept. On pages 235-236 of his book, Sakaiya says that “knowledge-value means both ‘the price of wisdom’ and ‘the value created by wisdom.’ A more strict definition might be, ‘the worth or price a society gives to that which the society acknowledges to be creative wisdom.’ …The truly large-scale production of knowledge-value will take the form of concrete goods and services in which it is embedded, or to which it can be added, and its distribution will be either synonymous with or conducted in concert with those goods and services,” (1991). From this definition and description, we can start to see that knowledge-value is something which has its formative roots in creativity and ingenuity and then becomes embedded in products and services giving them value for which society is willing to pay a price. As we will see in the next paragraphs, this sort of concept has been described very similarly in Economics as the Ultimate Resource.

My initial contact with the concept of the ultimate resource was in a podcast from EconTalk, in which the host, Russ Roberts, was discussing the economics of buying local with Don Boudreaux, Chairman of the Department of Economics at George Mason University. In this, Boudreaux gives his explanation of the concepts originally put forth by Julian Simon in his book The Ultimate Resource. Boudreaux discusses the idea that people consider resources to be materials that are “out there.” However, using an impromptu example, he imagines that Native Americans hundreds of years ago would have found oil bubbling up in a stream to detract from the quality of the drinking water and therefore to have been a problem rather than a resource. He says that it is the application of human creativity that changes oil into something useful (Boudreaux, 2007). Figuring out how to use potential resources productively and economically to make human life better is the act which creates value, not the potential resources themselves. This explanation interprets the thesis of The Ultimate Resource in a way that I think makes it very easy to see the connection between the ultimate resource and knowledge-value. However, looking into Julian Simon’s central argument can help us see what other ideas can be inferred from these concepts.

The thesis of the Ultimate Resource II (a revision of the original, rather than a sequel) can be summed up like this: Shortages of resources will occur due to population and income growth, and this will cause prices to go up. As prices go up, the incentive to find other alternatives to the resource or to find new ways to use less of the resource will motivate people to find ingenuitive ways to fill the shortage. Simon argues that the end result is that we find ourselves better off than if the shortage had never happened, with lower prices due to lower demand and more efficient use (Simon, 1996). The conclusions to be drawn from this are that progress is made through the efforts of intelligent and creative people, and to limit the number of such people involved in that progress is to limit the supply of ingenuity, and therefore to limit progress itself. The true resource that adds value is the trained workforce that is the source of creativity.

To tie this in with our Leadership seminar, adding knowledge-value to everything we touch is something that we talk about doing, and it seems worthwhile, even if we were to assume it was only supplemental to the other valuable parts of an operation. What Julian Simon and Don Boudreaux show us is that adding knowledge-value isn’t one of the resources we can use to make our lives better, it is the ONLY resource we have to make our lives better. Understanding this in a leadership position is extremely important. A leader must recognize and appreciate the people that they are leading (along with themselves) as the ultimate and only true resource which they have, and instill in those people the same value for their own ingenuity and that of their peers. In order to thrive, an organization must have a strong group of creative people designing systems to fulfill needs in ways that are valuable to society. The more sources of ingenuity an organization has, the more knowledge-value it will be able to generate. That’s why every member of a team needs to be able contribute their own creativity freely. A leader who limits the creative input of the people they are leading is limiting the knowledge-value that will then be embedded in their final product or service. This will lower the value, and therefore the price, that society will attribute to it, and will limit the success of the organization.

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As a Share of Income, Americans Have the Most Affordable Food in World & It's Never Been Better by Mark J. Perry.

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Economic Growth Happens When Labor Becomes More (Not Less) Productive by Don Boudreaux.

I enjoyed Timothy Noah’s review of my colleague Tyler Cowen’s book The Great Stagnation (“Don’t Worry, Be unhappy,” Feb. 21). But Mr. Noah oversimplifies Cowen’s thesis by suggesting that Cowen measures an innovation’s merit by how much employment it creates.

It’s true that Cowen notes that (as Mr. Noah reports with dismay) “the iPod has created fewer than 14,000 jobs in the U.S.” But immediately after noting this fact, Cowen rightly observes that “we should applaud the iPod for creating so much value with so little human labor” [original emphasis].

Mr. Noah is wrong to suppose that the value of innovations is found in the number of workers they employ. Consider agriculture: the many innovations in that arena over the years – such as mechanized harvesters, chemical fertilizers, and bio-engineering to increase crop yields – have dramatically reduced the number of people employed in agriculture. Would we be remotely as wealthy as we are today if it still took nine of us to feed every ten of us?

Economic growth is overwhelmingly the proximate result of innovations that allow fewer workers to produce more output – thereby releasing that most precious of all resources, human labor, for use in producing goods and services that earlier were too costly to produce.

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Why Do We Take These People Seriously?; Exhibit #34,577 by Don Boudreaux.

Yes, the Social Security “trust fund” is indeed filled with ample quantities of interest-bearing U.S. treasuries. But the same organization (Uncle Sam) that is the creditor on these treasuries is also the debtor on them. Ask: when Uncle Sam cashes in these treasuries to get funds to pay promised Social Security benefits, who pays Uncle Sam the principal and interest on these treasuries? Answer: Uncle Sam – who must, of course, raise taxes on flesh-and-blood people to get the dollars that he pays to himself so that he can then pay out promised Social Security benefits.

I.O.U.s written to one’s self are not assets. They are, instead, pathetic reminders of one’s gross financial irresponsibility.

Bernie Madoff is in jail – rightly so – for duping people with the same sort of financial flim-flammery that the White House budget director today peddles in your pages.

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Joaquín Soler Serrano [España, 1919-2010] por EQDLM.