[Editor note: The posts in this series are The Great Energy Resource Debate (Part I: Peak Oil was … is here!) and The Great Energy Resource Debate (Part II: Neo-Malthusian Alarmism). Part IV will look at the theoretical case for resource expansionism in light of the preceding posts.]
Julian Simon has commented that the logic of expanding oil supply is a hard case to make–not because it is incorrect but because it flies in the face of the deeply ingrained physical-science concept of fixity and depletion. But there is no question that for too many minerals and for too many long periods of time, supply has been expanding rather than depleting in a business/economic sense. And far too many of us have ‘jumped off a tall building and reported everything was nice and breezy on the way down’ but haven’t hit bottom. Peak minerals might not be in the wrong year or decade but the wrong century.
Even the best have been fooled, including Erich Zimmermann, the institutional economist whose functional theory has brilliant insights for the twin Austrian-school open-ended entrepreneurship theory and Julian Simon human-ingenuity theory. “Oil and natural gas are forging ahead rapidly, but because their total reserves are much smaller than those of coal they are bound to lose in relative importance in the not too distant future,” he said in the second edition of his classic, World Resources and Industries. (1)
The quotations below offer evidence of resource pessimists who changed their mind in regard to mineral energies of oil, natural gas, and coal. (Julian Simon, it will be remembered, left Malthusianism because of incongruent data.) Such is good news: an open mind is a terrible thing to waste! It is a sad thing when thinkers (e.g., the late Matthew Simmons) go from the conclusion to the data rather than the other way around.
“Periodically ever since I was a small boy, there has been an agitation predicting an oil shortage, and always in succeeding years, the production has been greater than ever before.”
- J. Howard Pew, quoted in August Giebelhaus, Business and Government in the Oil Industry: A Case Study of Sun Oil, 1876-1945 (Greenwich, CT: Jai Press, 1980), p. 118.
“I started out as an ardent conservationist…. I was convinced by much reading in college and at Yale Law School [in the late 1920s/early 1930s] that we were going to run out of petroleum. After spending most of my life fighting a surplus, however, I’ve come to believe it will never run out.”
- J. Howard Marshall II, Done in Oil (College Station: Texas A&M University Press, 1994), p. 264.
“Several times in the past we have thought that we were running out of gas, whereas actually we were only running out of ideas.”
- John B. Curtis, Potential Gas Agency, taken from Web site www.mines.edu/research/pga/.
“We are in a second world oil crisis. But in the 1970s the problem was a shortage of oil. This time round the problem is that we have too much.”
- Greenpeace (2000), quoted in Bjorn Lomborg, The Skeptical Environmentalist (Cambridge, UK: Cambridge University Press, 2001), p. 258.
Christopher Flavin (Worldwatch Institute)
“Since the early eighties the world oil market has been dominated by excess production capacity, caused in large measure by the efficiency gains of the last decade. This condition is likely to last for some years, given the large excess production capacity in the Middle East, which has 57 percent of the world’s proven oil reserves.”
- Christopher Flavin and Alan Durning, “Building on Success: The Age of Energy Efficiency,” Worldwatch Paper 82, Worldwatch Institute, March 1988, p. 45.
“In 1972, the Club of Rome warned that the world would run out of fuels and raw materials. To the contrary, the world today faces a glut rather than a shortage of fossil fuels.”
- Christopher Flavin and Alan Durning, “Building on Success: The Age of Energy Efficiency,” Worldwatch Paper 82, Worldwatch Institute, March 1988, p. 55.
“There are no serious limitations on fossil-fuel supplies now or in the immediate future.”
- Paul Ehrlich and Anne Ehrlich, Healing the Planet (New York: Addison-Wesley Publishing, 1991), p. 46.
“The prices of more raw materials are indeed dropping than are rising, but those who cite this statistic as evidence that everything is rosy on the material resource front fail to recognize that market prices don’t capture the full social costs of resource harvesting and consumption. . . . The bottom line is: declining prices may not indicate increasing human welfare.”
- Paul Ehrlich and Anne Ehrlich, Betrayal of Science and Reason (Washington: Island Press, 1996), pp. 98-99.
“We’re not running out of energy, but ‘we’re running out of environment, patience with inequality, money for sustainability, time for making a transition, and leadership to do what is required.’”
- Paul and Anne Ehrlich, Betrayal of Science and Reason (Washington: Island Press, 1996), pp. 94-95.
Even Lester Brown ….
“It will not necessarily be the scarcity of fuel that constrains future growth in energy consumption, but rather concerns about climate change, air quality, and water quality.”
- Lester Brown et al., Beyond Malthus: Sixteen Dimensions of the Population Problem (Washington: Worldwatch Institute, 1998), p. 42.
(1) Erich Zimmermann, World Resources and Industries (New York: Harper & Brothers, 1951), p. 454.