“The quality of [truth-seeking] depends on a willingness to respectfully engage in open, honest, and objective debate, to challenge … our own beliefs…. As the philosopher, economist, and Anglican bishop Richard Whately observed: ‘It is one thing to wish to have truth on our side, and another thing to wish sincerely to be on the side of truth’.”

- Charles Koch, The Science of Success (John Wiley & Sons, 2007), p. 115. [Book review here]

A week ago I posted a tribute to Julian Simon (1932–1998) on the anniversary of his death. The post was picked up elsewhere in the blogosphere, and I received a number of emails from academics who remarked about how much they appreciated Simon’s personal kindness and scholarly qualities. Steve Horwitz wrote at Coordination Problem:

[Simon] was a model of what a scholar can and should be:  well-read, totally on top of the relevant data, fearless about taking on sacred cows, unafraid to be in your face but always with a smile on his face.  Plus, his boundless optimism for humanity’s future makes for a wonderful contrast to not just the doom-and-gloom of the environmentalists, but even the doom-and-gloom of some libertarians, for whom disaster (though political not environmental) lurks just around the corner.

Plus, Simon’s bet with Ehrlich is the best example of challenging “cheap talk” ever.

Above all of that, he was a charming man who even had time for three over-eager assistant professors on a boat ride in the middle of the Mediterranean in the fall of 1994.  I know that Pete, Dave, and I would all tell you that the 45 minutes we spent chatting with Julian at the rear of that boat on a gorgeous sunny day was one of the fonder memories we have of time spent with Big Thinkers.  He was funny, charming, and gracious.  And he is missed.

Yes, Simon was a true scholar who worked in a ‘challenge culture’ inside his mind.  I remember how at his Houston Forum talk, “More People, Greater Wealth, Expanded Resources, Cleaner Environment,” he was asked perhaps the hardest question of all: what do you think is the major weakness of your view. (What would your answer be to this question?) I remember the pained expression on Simon’s face as he grabbled with that question. I just knew how hard he was trying….

A Reformed Malthusian!

Simon fundamentally changed his worldview as an adult. Here is the story (sources at listed in the end):

In 1966, Julian Simon began studying issues of population, resources, and the environment. He began as a Malthusian, fearing more people in a world where the means of subsistence was fixed (Simon, 2002: 237–40).

Simon’s conversion to viewing human beings as the solution rather than the problem occurred in 1969; by 1972 or so, he had achieved full confidence in his new outlook (Simon, 2002: 240). He first went public with his contra world view in 1970 (Simon, 1996: 578; 2002: 243), the year in which he engaged in an Earth Day debate against Paul Silverman on his campus, the University of Illinois–Urbana-Champaign (Simon, 2002: 259–64). Simon’s shift was influenced by the statistical inferences he uncovered and by studying the research of others, particularly Harold Barnett and Chandler Morse’s 1963 classic, Scarcity and Growth (Simon, 2002: 242–43).

In 1969, Simon had an epiphany on the way to a meeting with U.S. officials to discuss ways to reduce fertility in less-developed countries. He thought, “Enabling a potential human being to come into life and to enjoy life is a good thing just as protecting a living person’s life from being ended is a good thing” (Simon, 1996: xxxii). He also thought: “What business do I have trying to help arrange it that fewer human beings will be born, each one of whom might be a Mozart or a Michelangelo or an Einstein—or simply a joy to his or her family and community, and a person who will enjoy life?” (xxxi).

Thus did Julian Simon, an open-minded scholar, change his mind on professional and personal grounds and become a determined advocate for his contra-Malthusian view to the day he died in 1998.

Bibliography

Barnett, Harold, and Chandler Morse. Scarcity and Growth: The Economics of Natural Resource Availability. Baltimore: Johns Hopkins University Press (for Resources for the Future), 1963.

Simon, Julian. The Ultimate Resource 2. Princeton: Princeton University Press, 1996.

Simon, Julian. A Life Against the Grain. New Brunswick, NJ: Transaction Publishers, 2002.

With a variety of intellectual, political, and public relations setbacks, climate alarmists are on a hot seat of their making.  They can dig in more (the new denialists) or at least more sympathetically study the ‘opposition’ to perhaps become global lukewarmers–and non catastrophists.

If so, they will follow the example of the late, great Julian Simon.

Editor note: Julian Simon is a primary inspiration for this free-market energy blog, the name of which comes from his characterization of energy as the master resource.

Twelve years ago today came the shocking news: Julian Simon, age 65, had died of heart failure after his regular morning workout in Chevy Chase, Maryland. He had undiagnosed heart disease.

Just two months before, I had visited extensively with Simon when he came Houston to give what would be his last major address, titled: “More People, Greater Wealth, Expanded Resources, Cleaner Environment.” A full house of 200 heard Simon that day, and one in attendance, free-market entrepreneur Gordon Cain, was so impressed that he mailed Simon an unsolicited $25,000 check for research.

Simon invited me to coauthor an energy paper with him for a conference he was planning. This excited me, as did his warm inscription to my first edition copy of The Ultimate Resource. After all, he was the latest major influence on me in a line of thinkers that began with Ayn Rand and had continued with Ludwig von Mises and F. A. Hayek. Not unlike other libertarians, I had gone from individualism-is-cool (Rand’s The Fountainhead) to free-markets-work (Mises’s Human Action) to the-perils-of-government-planning (Hayek, various).

I am not the only one to list Simon alongside other top classical liberal/libertarian scholars. Don Boudreaux, chair of the department of economics at George Mason University, wrote:

The three scholars who have had the the greatest impact on my own thinking are F. A. Hayek, James Buchanan, and Julian Simon….  [Simon's] vital idea of “the ultimate resource”  … is one of the most profound—and least understood—in all of the social sciences.

 Dear Professor Simon,

I have never before written a fan letter to a professional colleague, but to discover that you have in your Economics of Population Growth provided the empirical evidence for what with me is the result of a life-time of theoretical speculation, is too exciting an experience not to share it with you. The upshot of my theoretical work has been the conclusion that those traditional rules of conduct (esp. of several property) which led to the greatest increases of the numbers of the groups practicing them leads to their displacing the others — not on “Darwinian” principles but because based on the transmission of learned rules — a concept of evolution which is much older than Darwin.

I doubt whether welfare economics has really much helped you to the right conclusions. I claim as little as you do that population growth as such is good — only that it is the cause of the selection of the morals which guide our individual action. It follows, of course, that our fear of a population explosion is unjustified so long as the local increases are the result of groups being able to feed larger numbers, but may become a severe embarrassment if we start subsidizing the growth of groups unable to feed themselves.

Sincerely, F. A.Hayek

Hayek wrote a second letter upon reading The Ultimate Resource:

Dear Professor Simon,

… I have now at last had time to read [The Ultimate Resource] with enthusiastic agreement. So far as practical effect is concerned it ought to be even more important than your theoretical work which I found so exciting because it so strongly supports all the conclusions of the work I have been doing for the last few years. I do not remember whether I explained in my earlier letter that one, perhaps the chief thesis of the book on The Fatal Conceit, the first draft of which I got on paper during the past summer, is that the basic morals of property and honesty, which created our civilization and the modern numbers of mankind, was the outcome of a process of selective evolution, in the course of which always those practices prevailed, which allowed the groups which adopted them to multiply more rapidly (mostly at their periphery among people who already profited from them without yet having fully adopted them.) That was the reason for my enthusiasm for your theoretical work.

Your new book I welcome chiefly for the practical effects I am hoping from it. Though you will be at first much abused, I believe the more intelligent will soon recognize the soundness of your case. And the malicious pleasure of being able to tell most of their fellows what fools they are, should get you the support of the more lively minds about the media. If your publishers want to quote me they are welcome to say that I described it as a first class book of great importance which ought to have great influence on policy….

Sincerely, F. A. Hayek

Two Tributes: Ben Wattenberg and Stepehn Moore

Two tributes to Simon upon his passing are worth rereading. One was published in the Wall Street Journal by close friend Ben Wattenberg; the other (longer) piece is by Simon’s pupil-made-good (and the 1st winner of the Julian Simon Memorial Award), Stephen Moore. I reproduce both below, as well as the New York Times obituary on Simon.

Malthus, Watch Out: Ben Wattenberg, Wall Street Journal, February 11, 1998

Julian Simon, who waged intellectual war on environmentalists and Malthusians, died suddenly on Sunday. He would have been 66 tomorrow, the day of his funeral.

Simon could sometimes glow like an exposed wire, crackling with nervous intellectual intensity. Privately, he had a soul of purest honey. But by force of will, fueled by his sizzling energy, Simon helped push a generation of Americans to rethink their views on population, resources and the environment. By now it is clear that in this task he was largely successful. As the years roll on he will be more successful yet, his work studied, and picked at, by regiments of graduate students.

His keystone work was “The Ultimate Resource,” published in 1981 and updated in 1996 as “The Ultimate Resource 2″ (Princeton University Press). Its central point is clear: Supplies of natural resources are not finite in any serious way; they are created by the intellect of man, an always renewable resource. Coal, oil and uranium were not resources at all until mixed well with human intellect.

The notion drove some environmentalists crazy. If it were true, poof!–there went so many of the crises that justified their existence. From their air-conditioned offices in high-rise buildings, they brayed: Simon believes in a technological fix! The attacks often got personal: Simon’s doctorate was in business economics, they sniffed; he had merely been a professor of advertising and marketing, and–get this–he had actually started a mail-order business and written a book about how to do it. Never mind that he also studied population economics for a quarter century.

In fact, it was Simon’s knowledge of real-world commerce that gave him an edge in the intellectual wars. He knew firsthand about some things that many environmentalists had only touched gingerly, like prices. If the real resource was the human intellect, Simon reasoned, and the amount of human intellect was increasing, both quantitatively through population growth and qualitatively through education, then the supply of resources would grow, outrunning demand, pushing prices down and giving people more access to what they wanted, with more than enough left over to deal with pollution and congestion. In short, mankind faced the very opposite of a crisis.

Simon rarely presented a sentence not supported by facts–facts arranged in serried ranks to confront the opposition; facts about forests and food, pollution and poverty, nuclear power and nonrenewable resources; facts used as foot soldiers to strike blows for accuracy.

In a famous bet, gloom-meister Paul Ehrlich took up Simon’s challenge and wagered that between 1980 and 1990 scarcity would drive resource prices up. Simon bet that progress would push prices down. Simon won the bet, easily. Mr. Ehrlich won a MacArthur Foundation “genius” grant. But the wheel turns, and we’ll see who’s a genius. Fortune magazine listed Simon among “the world’s most stimulating thinkers.” Mr. Ehrlich didn’t make the cut.

Simon sensed the primacy of something else that many environmentalists and crisis-mongers didn’t catch on to for a quite a time: Human intellect could best be transformed into beneficial goods and services in an atmosphere of political and economic liberty. At the United Nations’ Mexico City population conference in 1984 Simon winced, and counterattacked, when population alarmists caricatured the Reagan-appointed American delegation as promoting the idea that “capitalism is the best contraceptive.” It was not a good idea to ridicule capitalism, or free markets, or human liberty, in Simon’s presence.

Of course, rising living standards do tend to depress fertility. Living standards do rise faster under democratic market systems. Smart folks now know that the fruits of economic growth can be used to diminish pollution. You don’t hear much anymore about how we’re running out of everything. (Next task: Simonize the Global Warmists.)

Finally, unlike many of his opponents, Julian was a traditionalist. He did not work on the Sabbath, and the Friday Sabbath dinner at the Simon house was always a gentle and joyous celebration.

At rest on the Sabbath, Julian was indefatigable the rest of the week, chasing his precious facts. If Thomas Malthus is in heaven, he’s in for an argument, laced with facts, facts, facts. 

Julian Simon Remembered: It’s A Wonderful Life

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.

New York Times Obituary “Julian Simon, 65, Optimistic Economist, Dies” by Kenneth Gilpin, February 12, 1998

Julian L. Simon, an economist and professor who spent much of his professional life taking on scientists, demographers and other academics who argued that mankind was stretching the resources of the earth to the breaking point, died at his home in Chevy Chase, Md., on Sunday.

The cause of death was a heart attack, his son, David, said. Mr. Simon was 65.

At the time of his death, Mr. Simon was a professor of business administration at the University of Maryland and a senior fellow at the Cato Institute, a conservative Washington research organization. And his views, generally optimistic about the benefits humans bring to the planet and about man’s prospects for the future, were widely debated.

The essence of Mr. Simon’s view of man and the future is contained in two predictions for the next century and any century thereafter that are in ”The State of Humanity,” a book he edited for the Cato Institute.

”First,” he wrote, ”humanity’s condition will improve in just about every material way. Second, humans will continue to sit around complaining about everything getting worse.”

He argued that mankind would rise to any challenges and problems by devising new technologies to not only cope, but thrive. ”Whatever the rate of population growth is, historically it has been that the food supply increases at least as fast, if not faster,” he said in a profile published in Wired magazine last year.

Mr. Simon’s views were widely contested by a large coterie of the academic and scientific community, many of whose members believe that more people create more problems, straining the earth and its resources in the process.

”Most biologists and ecologists look at population growth in terms of the carrying capacity of natural systems,” said Lester R. Brown, president of the Worldwatch Institute in Washington. ”Julian was not handicapped by being either. As an economist, he could see population growth in a much more optimistic light.”

In 1980, for example, Mr. Simon and Herman Kahn, the futurist, headed a panel organized by the conservative Heritage Foundation that took sharp issue with findings of the Global 2000 Report, a study issued by the Carter Administration.

Among other things, the report said that ”if present trends continue, the world in 2000 will be more crowded, more polluted, less stable ecologically and more vulnerable to disruption than the world we live in now.”

At the time Mr. Simon was an economics professor at the University of Illinois. But he had been researching and writing about the positive effects of population growth since 1965, when he saw a headline in The New York Times warning of a population doomsday.

”Fortunately for this planet,” Mr. Simon said in response to the Global 2000 Report, ”these gloomy assertions about resources and environment are baseless.”

Mr. Simon’s sunny view of the future became the basis for a highly publicized bet in 1980 with Paul R. Ehrlich, the Stanford University ecologist whose 1968 book, ”The Population Bomb,” predicted that one-fifth of humanity would starve to death by 1985.

Mr. Ehrlich and two colleagues from the University of California at Berkeley were piqued by an article Mr. Simon wrote for Science magazine titled ”Resources, Population, Environment: An Oversupply of False Bad News.” They responded to a challenge by Mr. Simon to Malthusians that the price of any natural resource would be lower by a mutually agreed-upon date, not higher.

Mr. Ehrlich and his colleagues took the bet on the belief that rising demand for raw materials by an exploding global populace would pare supplies of nonrenewable resources, driving up prices. Mr. Ehrlich said he had accepted Mr. Simon’s ”astonishing offer before other greedy people jump in.”

The Ehrlich group bet $1,000 on five metals — chrome, copper, nickel, tin and tungsten — in quantities that each cost $200 in October 1980, when the bet was made. Mr. Simon agreed that he would sell the agreed-upon quantities of the metals to the Ehrlich group 10 years later at 1980 prices. If the combined prices of acquiring the metals in 1990 turned out to be higher than $1,000, Mr. Simon would pay the difference in cash. If prices fell, the Ehrlich group would pay him.

During the decade, the world’s population grew by more than 800 million, the greatest increase in history, and the store of metals did not get any larger. Yet in the fall of 1990, with the prices of the metals down sharply, Mr. Ehrlich mailed Mr. Simon a check for $576.07.

Mr. Simon wrote back a thank you note, along with a challenge to raise the wager to as much as $20,000, tied to any other resources and to any other year in the future. Mr. Ehrlich declined to take him up on the new offer.

Born in Newark, Mr. Simon studied psychology as an undergraduate at Harvard University, then earned an M.B.A. and a doctorate in business economics at the University of Chicago. He joined the faculty at the University of Illinois in 1963.

Much of his early work was in mail order marketing — his book on the topic, ”How to Start and Operate a Mail Order Business,” sold more books than any he wrote subsequently. But his attention turned to population questions after he heard the grim predictions about an overpopulated planet.

Despite his optimism about the future of mankind, Mr. Simon was given to personal bouts of depression. As a form of therapy he wrote a book on the subject, ”Good Mood: The New Psychology for Overcoming Depression.”

An active lecturer, Mr. Simon’s view of the world and man’s possibilities never wavered.

”He believed that the world needs problems because they make us better,” said Robert L. Bradley Jr., president of the Institute for Energy Research in Houston. ”Problems make us better off than if they had never occurred.”

Mr. Simon is survived by his wife, Rita James Simon of Chevy Chase; three children, David M. Simon of Chicago, Judith Simon Garret of Vienna, Va., and Daniel H. Simon of Laurel, Md., and one grandchild.

Best of MasterResource 2009: This post originally appeared on September 5th.

Julian Simon (1932–98) is an inspiration to those of us here at MasterResource and, indeed, the whole capitalist movement. Indeed, it was he who characterized energy as the master resource and human ingenuity as the ultimate resource.

In honor of Simon, I have reproduced some quotations from his works and invite readers to add their favorite in the comment section.

“The world’s problem is not too many people, but a lack of political and economic freedom.”

- Julian Simon, The Ultimate Resource 2 (Princeton, N.Y.: Princeton University Press, 1996), p. 11.

“There is only one important resource which has shown a trend of increasing scarcity rather than increasing abundance. That resource is the most important of all—human beings. . . . [An] increase in the price of peoples’ services is a clear indication that people are becoming more scarce even though there are more of us.”

- Julian Simon, The Ultimate Resource 2 (Princeton, N.Y.: Princeton University Press, 1996), p. 581.

“Human beings create more than they destroy.”

- Julian Simon, The Ultimate Resource 2 (Princeton, N.Y.: Princeton University Press, 1996), p. 580.

“Progress toward a more abundant material life does not come like manna from heaven. . . . My message certainly is not one of complacency. In this I agree with the doomsayers: our world needs the best efforts of all humanity to improve our lot.”

- Julian Simon, “Introduction,” in Simon, ed., The State of Humanity (Cambridge, MA: Blackwell, 1995), p. 27.

“Adding more people causes problems. But people are also the means to solve these problems. The main fuel to speed the world’s progress is our stock of knowledge; the brakes are our lack of imagination and unsound social regulations of these activities. The ultimate resource is people—especially skilled, spirited, and hopeful young people endowed with liberty—who will exert their wills and imaginations for their own benefits, and so inevitably they will benefit the rest of us as well.”

- Julian Simon, “Introduction,” in Simon, ed., The State of Humanity (Cambridge, MA: Blackwell, 1995), p. 27.

And here is one Simon-like quotation from outside of the Simon tradition to think about!

“The worst of all forms of pollution is wasted lives.”

- Al Gore, Earth in the Balance: Ecology and the Human Spirit (New York: Plume/Penguin, 1992, 1993), p. 162.

Remember the Club of Rome’s resource scare? In 1972, 57 predictions of exhaustion were made regarding 19 different minerals. All either have been falsified or will be.

Remember the global-cooling scare promoted by, among others, the Obama administration’s science czar, John Holdren? (Yes, global cooling was a big deal, although it was not a “consensus.”)

And all of the above doom merchants were uber-confident and still are loath to admit they were ever wrong. Holdren, for example, is sticking to his prediction that as many as one billion people could die by 2020 from (man-made) climate change. That’s about ten years, folks.

Climategate/Climate McCarthyism

Now to today. Error and intolerance rule in the global warming scare. Read the flaming emails from the principals of Climategate. Read about Joseph “Climate McCarthyism” Romm by his critics on the Left.  Read the latest from (non-Climategater) Michael Schlesinger, who lost his cool against New York Times environmental reporter Andrew Revkin.

And of course there is John Holdren, now science advisor to President Obama, who said this to me when I asked him to critically review my essay evaluating his 2003 criticism of Bjorn Lomborg, “The Heated Energy Debate.”  Holdren responded:

What exactly entitles you to the evidently self-applied label of ‘energy expert’?  …. You are of course entitled to (verbally) attack me in any legal way you like, but please don’t then pretend in personal notes to me that we are colleagues, each doing our best to get at the truth…. [Y]ou appear to be … lacking both discernible qualifications in the real world and the ability to tell a good argument from a bad one. I want nothing further to do with you.

A strange intellectual dude.

Remember Julian Simon

Today’s Climategate is predictable with some of the same players at work–and many new ones as well. Remember how Paul R. Ehrlich treated his intellectual rival Julian Simon? The Stanford University biologist refused to debate Simon or even meet him in person. He insulted Simon repeatedly in print. Ehrlich even scolded Science magazine for publishing Simon’s 1980 breakthrough essay “Resources, Population, Environment: An Oversupply of Bad News,” with the words: “Could the editors have found someone to review Simon’s manuscript who had to take off this shoes to count to 20?” (quoted in Julian Simon, The Ultimate Resource II, 1996, p. 612).

Here is the full story from chapter 11 of my Capitalism at Work: Business, Government, and Energy (pp. 272–73):

Science magazine in mid-1980 published an essay by Julian Simon that “raised the blood pressure of the scientific community a good twenty points,” one Malthusian environmentalist recalled. “Resources, Population, Environment: An Oversupply of False Bad News” presented official statistics to refute high-profile media scare stories. In so doing, Simon challenged the interrelated notions of a fixed supply of land, fixed and depleting resources, a growing inadequacy of food supply, an inverse relationship between population and progress, and a worsening environment.

Simon’s cherry-on-top was answering, Why do we hear phony bad news? Part of his explanation was “bad news sells books, newspapers, and magazines: good news is not half so interesting.” He asked, “Is it a wonder that there are lots of bad-news best-sellers warning about pollution, population growth, and natural-resource depletion but none telling us the facts about improvement?”

The provocative essay, published on the home turf of the neo-Malthusians, put Simon’s ideas in play. Princeton University Press rushed ahead to publish what became Simon’s signature book, The Ultimate Resource. The sustainability debate was finally joined.

A flood of dissent filled the offices of the American Association of the Advancement of Science (AAAS) in response to Simon’s cannon shot. Paul Ehrlich asked: “Could the editors have found someone to review Simon’s manuscript who had to take off his shoes to count to 20?” Paul and Anne Ehrlich, John Holdren, and John Harte in a reply challenged Simon’s contention that oil was not becoming permanently scarcer. “The fact is that OPEC’s price hikes and the ‘improved market power’ of coal and uranium both reflected a new reality based on emerging scarcity of oil and natural gas.” Record oil prices gave at least superficial credence to their depletionism, but Simon, like M.A. Adelman, would soon have the upper hand.

Simon designed The Ultimate Resource (1981) to irresistibly engage his opponents. Using The Affluent Society by John Kenneth Galbraith as his model, Simon sought to write a popular book that would influence academia via the general public. Thus Simon turned over his trump cards in the introduction.

Hold your hat—our supplies of natural resources are not finite in any economic sense…. If the past is any guide, natural resources will progressively become less scarce, and less costly, and will constitute a smaller proportion of our expenses in future years. And population growth is likely to have a long-run beneficial impact on the natural-resource environment.

Energy. Grab your hat again—the long-run future of our energy supply is at least as bright as that of other natural resources, though political maneuvering can temporarily boost prices from time to time. Finiteness is no problem here either. And the long-run impact of additional people is likely to speed the development of a cheap energy supply that is almost inexhaustible.

Twenty-three chapters and thousands of data points later, his book ended: “The ultimate resource is people—skilled, spirited, and hopeful people who will exert their wills and imaginations for their own benefit, and so, inevitably, for the benefit of us all.” This was Erich Zimmermann resurrected—but backed by a much richer empirical record within a wider framework. It was Zimmermann who had written decades earlier, “Freedom and wisdom, the fruits of knowledge, are the fountainhead of resources.” A science of expansionism, and the integration of “depletable resources” in the corpus of general economics, was at hand.

The Ultimate Resource, condensing and building upon Simon’s 1977 book, The Economics of Population Growth, offered a new way to view the world. Science historian Thomas Kuhn, two decades before, had explained the whirlwind that Simon now found himself in. In Kuhnian terms, Simon’s time-series data revealed a gaping anomaly in an entrenched neo-Malthusian paradigm. The process of normal science had now to give way to extraordinary science, a scientific revolution whereby a new gestalt came forth. Not surprisingly, the establishment, viewing the world in a preformed and relatively inflexible box, was intolerant of the new theory.

Paradigm shifts, Kuhn explained, overturn the established order. Emotions run high. The process begins with scientists … behav[ing] differently and continues with pronounced professional insecurity where years and perhaps lifetimes of work and writing are put at risk. If the paradigm is powerful and useful, with open questions answered, it prevails until only a few elderly hold-outs remain.

Simon’s shift of vision was not verifiable as in the laboratory sciences, where experimentation under controlled conditions can objectively settle matters. While taking into account physical laws, social science issues such as the costs and benefits of population growth offered plenty of wiggle room for scientists to interpret the data differently or hold out for new data. Julian Simon would practically have to go it alone until economists—a few, more, then many—joined him against an entrenched core of largely environmental scientists wed to Malthusian notions.

Is there a paradigm crisis with exaggerated climate science? Is this why, in Kuhnian terms, so many–far too many–scientists are behaving strangely and badly?

In honor of Simon, I have reproduced some quotations from his works and invite readers to add their favorite in the comment section.

“The world’s problem is not too many people, but a lack of political and economic freedom.”

- Julian Simon, The Ultimate Resource 2 (Princeton, N.Y.: Princeton University Press, 1996), p. 11.

“There is only one important resource which has shown a trend of increasing scarcity rather than increasing abundance. That resource is the most important of all—human beings. . . . [An] increase in the price of peoples’ services is a clear indication that people are becoming more scarce even though there are more of us.”

- Julian Simon, The Ultimate Resource 2 (Princeton, N.Y.: Princeton University Press, 1996), p. 581.

“Human beings create more than they destroy.”

- Julian Simon, The Ultimate Resource 2 (Princeton, N.Y.: Princeton University Press, 1996), p. 580.

 “Progress toward a more abundant material life does not come like manna from heaven. . . . My message certainly is not one of complacency. In this I agree with the doomsayers: our world needs the best efforts of all humanity to improve our lot.”

- Julian Simon, “Introduction,” in Simon, ed., The State of Humanity (Cambridge, MA: Blackwell, 1995), p. 27.

“Adding more people causes problems. But people are also the means to solve these problems. The main fuel to speed the world’s progress is our stock of knowledge; the brakes are our lack of imagination and unsound social regulations of these activities. The ultimate resource is people—especially skilled, spirited, and hopeful young people endowed with liberty—who will exert their wills and imaginations for their own benefits, and so inevitably they will benefit the rest of us as well.”

- Julian Simon, “Introduction,” in Simon, ed., The State of Humanity (Cambridge, MA: Blackwell, 1995), p. 27.

And here is one Simon-like quotation from outside of the Simon tradition to think about!

“The worst of all forms of pollution is wasted lives.”

 - Al Gore, Earth in the Balance: Ecology and the Human Spirit (New York: Plume/Penguin, 1992, 1993), p. 162.

[Editor Note: This piece was orginally published by the Institute for Energy Research and is reprinted with permission]

There are two futures for energy, depending on which socioeconomic system we adopt. The free-market promises a bright energy future, while the opposite path of political energy is dark. In that sense energy differs little from other goods and services (such as health care): its supply will depend on whether economic laws are allowed to work or are hampered by political intervention.

Free-Market Energy

As the late Julian Simon explained, the future for free-market energy is positive. “It’s reasonable to expect the supply of energy to continue becoming more available and less scarce, forever.”[1] So Simon said in his most influential book, The Ultimate Resource. This prediction riled his Malthusian critics, who labeled Simon a naïve romantic. He responded: “I am not an optimist, I am a realist.”[2] In fact, Simon himself had once been a Malthusian and concerned about overpopulation and scarce resources, until the data reversed his thinking.[3]

But abundant free-market energy requires free-market institutions: private property rights, voluntary exchange, and the rule of law. This framework produces abundant energy by unleashing human ingenuity and problem-solving entrepreneurship, which Simon called the ultimate resource. The problem of scarcity, he explained, comes not from too many people or too few resources but from a “lack of political and economic freedom.”[4]

Doomsayers notwithstanding, our known resources of hydrocarbon energy are actually expanding. The historical record indicates that, despite ever-growing consumption, we have found new deposits of oil, gas, and coal as fast as or faster than we have consumed them. Thus, the total of the globe’s speculative resources, probable resources, and proved reserves has not depleting but just the opposite. According to current estimates, we have consumed only 1.5% of our physical hydrocarbon base.[5]In physical terms, then, the hydrocarbon era is still young. And this is good news indeed, because of the limited ability of dilute, intermittent energies such as wind and solar to power the industrial age.

Energy Statism

Unfortunately, free-market energy is not the only path, and its bright future not the only possible outcome. There is also the path of energy statism and the dark future it would bring.

Energy statism is both international and domestic. Internationally, as we know all too well, oil and gas resources and infrastructure are commonly government owned and operated, contributing to inefficiency and underutilization—as well as to political turmoil. This international statism is responsible for much of the price volatility experienced in energy markets. There is little America can do directly to neuter or end foreign energy politics except to lead by example with a domestic free market. Competition and capitalism are powerful forces.

But we can help ourselves by not making matters worse, as we did with the price and allocation controls that put Americans in the gasoline lines during the 1970s. Such regulation is thankfully absent today, yet do we have thousands of small edicts that make energy more expensive than it would be otherwise. Wealthy consumers can absorb such artificial scarcity, but poorer consumers must either cut back on their energy use or have less money to spend elsewhere. Thus energy taxes, whether explicitly enacted or created through regulation, are regressive.

Today, energy statism is driven largely by the overblown issue of climate change. In the name of a supposed need to “stabilize the climate,” energy planners at all government levels are restricting energy usage via mandates or tax policy. On the supply side, government promotes uneconomic “green” energy that is more expensive to both produce and transport and is less reliable than the energies that consumers would voluntarily choose. Meanwhile, federal laws lock up the large quantities of oil and gas on government land, off the east and west coasts, and in the Arctic National Wildlife Refuge.

Energy politicization will reach disastrous proportions if the U.S. Senate follows the House in voting for H.R. 2454, better known as the Waxman-Markey climate bill. This 1,428-page bill is an energy road to serfdom for America, and that is why it has become a rallying cry for the free-market community. Americans must stop the growth of politicized energy and move in the opposite direction of free-market energy. Nothing less than our industrial way of life is at stake.

[2] Simon, Julian. Population Matters. New Brunswick: Transaction Publishers, 1990, p. xi.

[3] Simon, Julian. A Life against the Grain. New Brunswick, NJ: Transaction Publishers, 2002, pp. 237–243.

[4] Simon, Julian. The Ultimate Resource 2. Princeton: Princeton University Press, 1996, p. 11.

[5] See Robert Bradley, “Are We Running Out of Oil? Functional Theory Says No,” PERC Reports (September 2004) at http://www.perc.org/articles/article452.php.

[Editor note: This piece, written during the BTU tax debate by Julian Simon (1932–1998), is reproduced for its relevance for today's energy debate]

As the fight intensifies about an energy tax in the budget bill, some cool heads ought to reexamine the underlying belief that it is good for us to “conserve energy.” We see that belief in headlines such as “The High Cost of Cheaper Energy,” and Washington Post editorials like “A Totally Free Market Leads to Over-Consumption.”

Conservation Isn’t Necessary or Good

Some people simply believe that it is ipso facto a good thing to use less energy and have less economic growth. As Paul Ehrlich put it, “Giving society cheap abundant energy is . . . like giving an idiot child a machine gun.” Other backers of the bill seek not only to preserve the supply of energy but also to return to a “simpler life” (for others, of course, not for themselves) because it will make us better human beings. As Amory Lovins puts it, “If nuclear power were clean, safe, economic, assured of ample fuel . . . it would still be unattractive.”

Perhaps most common are those who somehow believe that there is an economic rationale for “saving” energy. That unstated and unanalyzed belief is seen in columnist Jim Hoagland’s statement, “A rejection of energy taxes would send a message down the national spinal cord that America can still afford to use more of and pay less for the least efficient fuels.”

The economic-saving rationale for an energy tax is not, however, widely accepted among economists whose business it supposedly is to understand such matters. I’d bet that the consensus of leading economists does not support the public belief in energy conservation. (I also repeat my public offer to wager a week’s pay that the price of any type of energy will be lower at any future date than now, which would prove that there is no impending shortage and then no basis for tax restraints on energy use.)

Unfortunately, however, the thinking of economists on subjects like these seldom reaches the public because there is no established channel for it, whereas opinions that reflect the conventional beliefs of the day–and energy conservation is one of those beliefs–are routinely published and televised.

So we risk a national energy “plan” that would twist energy industries into knots by requiring conservation and forcing the substitution of other fuels for oil and coal, and eventually reduce supply and raise prices. It would waste our time and effort, slow the progress of civilization, and cripple the economy in order to mitigate a shortage of energy that a clutch of environmental doomsayers speculate will finish us off starting perhaps seven billion years from now. (Yes, you read right. That’s 7,000,000,000 years.) They write fearfully about an increase in entropy–the disappearance of order and the disintegration of all patterns of life into chaos.

Yet the trend in energy supply is just the opposite of what is assumed. Over the decades and centuries, energy has become less rather than more scarce, just like all other raw materials such as copper and land. And there is no reason to believe that this trend will ever reverse–it can go on forever.

Energy: An Expanding Resource

Governmentally-mandated conservation of energy would only drag down this progress. The historical facts entirely contradict the commonsensical Malthusian theory that the more we use, the less there is left to use, and hence the greater the scarcity. Energy has been getting more available, rather than more scarce, as far back as we have records. Through the centuries, the prices of energy — coal, oil, and electricity — have been decreasing rather than in- creasing, relative to the cost of labor and even relative to the price of consumer goods. The same is true of all natural resources. And nuclear energy costs less than either coal or oil.

Another way to look at the matter: Energy has become less and less important as measured by its share of GNP, just as have all other natural resources.

For perspective, reflect on the history of another resource that people have worried about since time immemorial: land. It has always seemed as obvious as the nose on your face that the supposedly-fixed supply of agricultural land must eventually limit the growth of population, by making food increasingly more expensive as the number of people grows. But lo and behold, just the opposite has happened. Food has decreased in price, nutrition has become progressively more abundant, and hunger and famine have diminished worldwide, even as population has grown. The explanation lies in the advance in knowledge of how to produce food.]

Just as people throughout history have said that the supply of land is limited and cannot be increased, many people have said that the energy-cost trend must turn around sometime because energy is “finite.” And they have gone on to assert that we should reject conventional economics and build a new system of “ecological economics” that uses energy as a standard of value. Here they resemble Marx and his labor theory of value in seeking a material standard of value, a solid physical foundation on which to stand.]

Energy differs from other resources because it is “used up,” and cannot be recycled. Energy apparently trends toward exhaustion. It seems impossible to keep using energy and still never run out of it, or even reach a point of increasing scarcity. But just as with land and copper, there are other forces at play which make it possible for us to have increasing amounts of the services we need and desire even as we boost the demands we make upon the supplies of those resources.

Advances in technology are the reason the prices of energy and other natural resources decline even as we use more of them. One saving grace is declining use of energy. Consider the steam engine, which at first operated at perhaps 1 percent efficiency. Engines nowadays operate perhaps thirty times more efficiently. That is, they use perhaps a thirtieth as much energy for the same result. When someone finds a way to increase the efficiency of a resource by, say, 1 percent, the discovery not only increases the efficiency of the energy we use this year, but it also increases the effective amounts of that resource in reserve or as yet undiscovered.

Also important are increases in energy supply. We learn how to dig deeper, pump faster. And we invent new sources of energy, as we went from wood to coal to oil to nuclear fission. We can also “grow” oil substitutes as long as there is sunlight to raise plants. Of course nuclear fission power will be available at constant or declining costs practically forever. And who knows, there may be nuclear fusion, or some other suns to take care of our needs after this one runs out. We’ve got seven billion years to discover solutions to the theoretical problems that we have only been able to cook up in the past few centuries of progress in physics. It’s reasonable to expect the supply of energy to continue becoming more available, forever.

Julian L. Simon , adjunct scholar at Cato Institute, teaches business administration at the University of Maryland, and is the author of books on resources and population economics. Rob Bradley, with permission from the Julian Simon family, added the two subtitles and deleted two “Can Delete” paragraphs dealing with the land example.

“A reliable and affordable supply of energy is absolutely critical to maintaining and expanding economic prosperity where such prosperity already exists and to creating it where it does not.”

- John Holdren, “Memorandum to the President: The Energy-Climate Challenge,” in Donald Kennedy and John Riggs, eds., U.S. Policy and the Global Environment: Memos to the President (Washington, D.C.: The Aspen Institute, 2000), p. 21.

Julian Simon (1932–98) is an inspiration to many of us here at MasterResource. Indeed, this blog is named for Simon’s characterization of energy as the master resource. In honor of Simon, I have reproduced some quotations from the vast literature on that theme.

The primal importance of energy is recognized across the political spectrum as the views of John Holdren, Paul Ehrlich, and Amory Lovins attest. Affordable, reliable energy is thus the starting point for public policy debate. And oil, gas, and coal are the backbone of energy plenty, as even politicians are realizing now that government-forced energy transformation (energy rationing) is under debate.

“The future belongs to the efficient,” it has been said. And the foreseeable future belongs to the carbon-based energies.

Here are some quotations, beginning with Julian Simon’s classic.

“Energy is the master resource, because energy enables us to convert one material into another. As natural scientists continue to learn more about the transformation of materials from one form to another with the aid of energy, energy will be even more important. . . . For example, low energy costs would enable people to create enormous quantities of useful land. The cost of energy is the prime reason that water desalination now is too expensive for general use; reduction in energy cost would make water desalination feasible, and irrigated farming would follow in many areas that are now deserts. And if energy were much cheaper, it would be feasible to transport sweet water from areas of surplus to arid areas far away. Another example: If energy costs were low enough, all kinds of raw materials could be mined from the sea.”

- Julian Simon, The Ultimate Resource 2 (Princeton: Princeton University Press, 1996), p. 162.

“Energy will do anything that can be done in the world.”

- Johann Wolfgang von Goethe (1749–1832), quoted in Vaclav Smil, Energy: A beginner’s Guide (Oxford: One World, 2006), epigraph.

“Every event in history can occur only insofar as there is available whatever amount of energy (i.e., work) is necessary to carry it out. We can think thoughts wildly, but if we do not have the wherewithal to convert them into action, they will remain [just] thoughts.”

- Richard Adam, Paradoxical Harvest (1982), quoted in Vaclav Smil, Energy in World History(Boulder, CO: Westview, 1994), epigraph.

“Coal, in truth, stands not beside but entirely above all other commodities. It is the material energy of the country—the universal aid—the factor in everything we do. With coal almost any feat is possible or easy; without it we are thrown back in the laborious poverty of early times.”

- William Stanley Jevons, The Coal Question (London: Macmillan, 1865), p. viii.

“Coal is everything to us. Without coal, our factories will become idle, our foundries and workshops be still as the grave; the locomotive will rust in the shed, and the rail be buried in the weeds. Our streets will be dark, our houses uninhabitable. Our rivers will forget the paddlewheel, and we shall again be separated by days from France, by months for the United States. The post will lengthen its periods and protract its dates. A thousand special arts and manufacturers, one by one, then in a crowd, will fly the empty soil, as boon companies are said to disappear when the cask is dry. We shall miss our grand dependence, as a man misses his companion, his fortune, or a limb, every hour and at every turn reminded of the irreparable loss. Wise England will then be the silly virgin without the oil in her lamp.”

- Anonymous, The Times, April 19, 1866, p. 10; reprinted in Sandra Peart, ed., W. S. Jevons: Critical Responses, 4 vol. (New York: Routledge, 2003), vol. 4, p. 196.

“As medical science, by deferring death, has allowed many more people to live on the earth, so the energy of fossil fuels, by deferring physical scarcity, has kept those people alive.”

- Amory Lovins, World Energy Strategies: Facts, Issues, and Options (New York: Friends of the Earth International, 1975), p. 3.

“Man was not man until he could use fire, a chemical energy with a thousand uses; he was not civilized until he had learned through domestication to appropriate the ‘foreign’ energy of animals and through agriculture to harness better the ‘free’ energy of solar radiation and the chemical energies of light, water, and soil.”

- Erich Zimmermann, World Resources and Industries (New York: Harper & Brothers, 1951), p 55.

“In its widest sense on its material side, history is the story of man’s increasing ability to control energy. By energy we mean the capacity for doing work, for causing—not controlling—movement, for making things go or making things stop, whether they be trains or watches or mills or men. In order that anything may be done, energy is required.”

- James Fairgrieve, Geography and World Power (New York: E.P. Dutton & Co., 1921), p. 3.

“Substitution of energy-intensive technologies powered by commercial energy forms for human and animal labor and the attendant productivity gains first led to abolition of slavery, serfdom, and child labor and culminated with the emancipation of women in the West. Thus, societal advances are inextricably linked to growing energy abundance and electrification and increasing personal mobility. Gross domestic product (GDP) per capita, life expectancy and literacy correlate closely with primary energy and electricity consumption, as does energy scarcity with poverty and environmental degradation. Electrification with modern, efficient and non-polluting power sources is by far the most effective way to improve environmental quality.”

- Henry Linden, “Operational, Technological and Economic Drivers for Convergence of the Electric Power and Gas Industries,” The Electricity Journal, May 1997, p. 14.

“Virtually all of the benefits that now seem necessary to the ‘American way’ have required vast amounts of energy. Energy, in short, has been our ultimate raw material, for our commitment to economic growth has also been a commitment to the use of steadily increasing amounts of energy necessary to the production of goods and services.”

- John Holdren and Philip Herrera, Energy (San Francisco: Sierra Club, 1971), p. 10.

“Energy is necessary for daily survival. Future development crucially depends on its long-term availability in increasing quantities from sources that are dependable, safe, and environmentally sound.”

- The World Commission on Environment and Development, Our Common Future (New York: Oxford University Press, 1987), p. 168.

“Seemingly abundant and cheap sources of energy permitted large-scale replacement of human labor in both manufacturing and agricultural production. . . . The availability of ‘cheap’ energy also made possible the development of powerful farm machinery, and abundant oil and gas allowed development of synthetic fertilizers, pesticides, and other products to boost crop yields (production per acre) considerably above those achieved with traditional methods. Similarly, we can thank fossil energy for facilitating the production of many useful goods and for stimulating unprecedented rapid expansion of economies and of food production. In effect, fossil energy facilitated the population explosion of the twentieth century.”

- Paul and Anne Ehrlich, The Population Explosion (New York: Simon & Schuster, 1990), p. 27.

“Energy . . . is the great enabler for all peoples around the world. It can also be expected to remain primary in future centuries as ocean and space colonization proceed. The sudden disappearance of hydrocarbons—for example, following a ten-year forced phase-out as urged by a popular book sounding the global warming alarm—could snap the support system maintaining current population levels and force a return to ecologically inferior primitive biomass. It would not be energy sustainability but energy holocaust.”

- Robert Bradley Jr., Julian Simon and the Triumph of Energy Sustainability (Washington, DC: American Legislative Exchange Council, 2000), pp. 27-28.

“By providing energy flows of high power density, fossil fuels and electricity made it possible to embark on a large-scale industrialization creating a predominantly urban civilization with unprecedented levels of economic growth reflected in better health, greater social opportunities, higher disposable incomes, expanded transportation and an overwhelming flow of information.”

- Vaclav Smil, Energies (Cambridge, MA: The MIT Press, 1999), p. 134.

“Energy is the only universal currency: one of its many forms must be transformed to another in order for stars to shine, planets to rotate, plants to grow, and civilizations to evolve. Recognition of this universality was one of the great achievements of nineteenth-century science, but, surprisingly, this recognition has not led to comprehensive, systematic studies that view our world through the power prism of energy.”

- Vaclav Smil, Energies (Cambridge, MA: The MIT Press, 1999), p. x.

“Energy is the biggest business in the world; there just isn’t any other industry that begins to compare.”

- Lee Raymond, Chairman, ExxonMobil, quoted in Staff Article, “The Slumbering Giants Awake,” The Economist, February 10-16, 2001, p. 6.

“The twentieth century was the first era dominated by fossil fuels and electricity, and their vastly expanded supply, lower cost, increasing flexibility of use, and ease of control created the first high-energy civilization in history. Mechanization and chemization of agriculture have given us a plentiful and varied food supply: more than a four fold increase in crop productivity during the twentieth century has been made possible by a roughly 150-fold increase of fossil fuels and electricity used directly and indirectly in global cropping.”

- Vaclav Smil, “The Energy Question, Again,” Current History, December 2000, p. 408.

“The great dramatic shift to mineral energy is the very basis of technological progress. One could almost concentrate the whole history of economic development into this simple transition: man power to animal power to machine power.”

- Erich Zimmermann, World Resources and Industries (New York: Harper & Brothers, 1951), p. 58.

“The shift to machine power changed America from a rural agricultural nation to an industrial giant. It also made men’s lives easier and richer. In 1850, the average American worked seventy hours a week. Today he works forty-three. In 1850, our average American produced about 27 cents’ worth of goods in an hour. Today he produces about $1.40 worth in dollars of the same purchasing power.”

- Erich Zimmermann, World Resources and Industries (New York: Harper & Brothers, 1951), p. 58.

“Civilizations resting on the modern resource pattern of inanimate energy-metal-science-capital are highly efficient as systems of physical production and therefore, theoretically at least, they are capable of freeing man from drudgery and of giving him leisure and wealth, the basis of higher spiritual development and the larger life.”

- Erich Zimmermann, World Resources and Industries (New York: Harper & Brothers, 1951), p. 73.

“Natural resources are the foundation for human life and underpin sustainable development. They provide the raw materials for meeting basic human needs: food and water, clothing and shelter, medicine, tools, energy and communication. They also provide recreational and other non-consumptive services for increasing numbers of people. Beyond these human needs, natural resources play an important role in providing the food, habitat, and reproductive bases for virtually all living resources, and in meeting ecosystem functions like carbon and nitrogen fixation, water catchment and temperature buffering.”

- Organisation for Economic Co-operation and Development, Sustainable Development: Critical Issues (Paris: OECD, 2001), p. 273.

“Kerosene has, in one sense, increased the length of life among the agricultural population. Those who, on account of the dearness or inefficiency of whale oil, were accustomed to go to bed soon after sunset and spend almost half their time in sleep, now occupy a portion of the night in reading and other amusements; and this is more particularly true of the winter seasons.”

- John Draper (1864), quoted in Harold Williamson and Arnold Daum, The American Petroleum Industry: The Age of Illumination(Evanston: Northwestern University Press, 1959), p. 320.

“The great forward steps of civilization are at least connected in part to breakthroughs on the energy front. The discovery of fire gave primitive man security and comfort on the ground; the domestication of animals added their greater muscle capacity to his. Later on, the waterwheel opened up a new source of energy to exploitation, greatly increasing the power available to his tasks. Then, in the nineteenth century the industrial revolution was fueled by coal.”

- John Fowler, Energy and the Environment (New York: McGraw-Hill, 1975), p. 296.

“Technology and change follow the liberation of energy. The lifestyle of contemporary America was destined by the development of fossil fuels in this seminal era.”

- Wilson Clark, Energy for Survival: The Alternative to Extinction (Garden City, NY: Anchor Books, 1974), p. 45.

“Reliable and affordable access to modern energy services is an indicator of sustainable development, for without it basic needs cannot be satisfied.”

- World Energy Council, Living in One World (London: World Energy Council, 2001), p. 74.

“After 1820 the world’s economy became increasingly based on work done by nonmuscular energy. By 1950 any society that did not deploy copious energy was doomed to poverty.”

- J. R. McNeil, Something New Under the Sun (New York: W. W. Norton & Company, 2000), p. 298.

“Energy is the lifeblood of the world’s economy, the underlying means by which modern societies function. Oil, coal, natural gas, and electricity are needed for virtually every important function in industrial societies—from growing and cooking food, to manufacturing, heating and cooling buildings, and moving people and goods. The interruption of supplies by storms, earthquakes, wars, or other events quickly demonstrates how totally dependent we have become on the energy-consuming machines.”

- James MacKenzie, “Oil as a Finite Resource: When is Global Production Likely to Peak?” World Resources Institute, March 1996, p. 2.

Few realize that the PGC has been raising the estimates of conventional resources throughout history, even as the United States has consumed large amounts of natural gas. Thus gas has been and is an expanding resource, not a depleting one.

In 1966, the PGC’s estimate of ultimately recoverable resource (i.e., including cumulative production) was 1,283 Tcf, versus the current estimate of approximately 2,600 Tcf, including 1,100 Tcf of cumulative production. While that includes several hundred Tcf of shale gas and coal-bed methane (CBM), conventional gas resources have surpassed 2,000 Tcf and are far beyond even the most optimistic estimates of a quarter century ago.

An excellent summary of those estimates can be found in the Office of Technology Assessment’s U.S. Natural Gas Availability: Conventional Gas Supply Through the Year 2000, which noted that the pessimistic projections for production in 2000 were about 9 Tcf. Total production that year proved to be over twice that amount, at 18.7 Tcf, of which less than 2 Tcf were shale gas and CBM.

In fact, resource estimates from that era have proved wildly pessimistic. A review of URR estimates from 11 different sources, including M. King Hubbert and Richard Nehring, found none that came close to current levels, with the highest at 1,800 Tcf. Indeed, five of the nine estimates of lower-48 remaining undiscovered resources came in below 200 Tcf, whereas production since then has been 500 Tcf.

Against this background, we have any number of pundits decrying the optimists arguments that resources will be sufficient for our needs, pointing to a few years of elevated prices, and encouraging the building of numerous—now idle—LNG import terminals. Even more, arguments that global gas resources are somehow constrained should be put to bed.

“So how about it, Al [Gore]?  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?”

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.