...my comments in italics as usual. The ususal anti-malthusian arguments apply (such as the implicit assumption that humanity will innovate at lower rates, etc.)
Until about 1800, our species had no safety margin and lived, like other animals, up to the limit of the food supply,
ebbing and flowing in population.
Ancient Greece and Egypt predated this. I would also add that the germ theory and plumbing had more to do with population growth (as mortality decreased dramatically) From about 1800 on the use of hydrocarbons allowed for an explosion in energy use, in food supply, and, through the creation of surpluses, a dramatic increase in wealth and scientific progress.
Hydrocarbons were not necessarily the driver of growth, merely the by product of an age that included the above health benefits, etc.
Since 1800, the population has surged from 800 million to 7 billion, on its way to an estimated 8 billion, at minimum.
Humanity is a growth sector. Higher life expectancy, lower infant mortality, Much greater understanding of disease control. More minds on the planet mean more genius and more innovation
The rise in population, the ten-fold increase in wealth in developed countries, and the current explosive growth in developing countries have eaten rapidly into our finite resources of hydrocarbons and metals, fertilizer, available land, and water.
Here comes the Malthus...geometric population growth coupled with Arithmetic food growth (or in this case an increasing rate of "decay" of finite resources) must equal a crisis.
Now, despite a massive increase in fertilizer use, the growth in crop yields per acre has declined from 3.5% in the 1960s to 1.2% today. There is little productive new land to bring on and, as people get richer, they eat more grain-intensive meat. Because the population continues to grow at over 1%, there is little safety margin.
Like Milton Friedman said "There is no cure for high prices like high prices" This is a static analysis ignoring the inevitable behavioral effects from price signals.
The problems of compounding growth in the face of fi nite resources are not easily understood by optimistic, short-term-oriented, and relatively innumerate humans (especially the political variety).
The fact is that no compound growth is sustainable. If we maintain our desperate focus on growth, we will run out of everything and crash. We must substitute qualitative growth for quantitative growth.
Growth has a way of declining. Trees do not grow to the sky.
But Mrs. Market is helping, and right now she is sending us the Mother of all price signals. The prices of all important commodities except oil declined for 100 years until 2002, by an average of 70%. From 2002 until now, this entire decline was erased by a bigger price surge than occurred during World War II.
In real or nominal terms?
Statistically, most commodities are now so far away from their former downward trend that it makes it very probable that the old trend has changed – that there is in fact a Paradigm Shift – perhaps the most important economic event since the Industrial Revolution.
What would a 10% decline in growth in the BRIC countries do to this prognostication? How likely is that event considering the current conditions for growth?
Climate change is associated with weather instability, but the last year was exceptionally bad. Near term it will surely get less bad.
Excellent long-term investment opportunities in resources and resource efficiency are compromised by the high chance of an improvement in weather next year and by the possibility that China may stumble.
China may stumble? Have you been reading this blog?
From now on, price pressure and shortages of resources will be a permanent feature of our lives. This will increasingly slow down the growth rate of the developed and developing world and put a severe burden on poor countries.
Chicken before the egg. Slowing growth rates will have the desired effect on commodities.
We all need to develop serious resource plans, particularly energy policies. There is little time to waste.
OK then. Lets make Saudi Arabia the 51st state, and buy a large portion of saharan West Africa. We need breeding room.