Malthus was very, very wrong
In 2019 the UN Population Report predicted that the world population would reach 10.9 billion people by 2100 and still be growing. In the 2022 version of that report, the population is expected to peak at 10.4 billion people during the 2080s. “Today,” according to the UN, “two-thirds of the global population lives in a country or area where lifetime fertility is below 2.1 births per woman, roughly the level required for zero growth in the long run for a population with low mortality.”
Much of the population increase in the short term comes from an increase in life expectancy. We geezers don’t contribute new fertile members of society. By 2100, the UN predicts the fertility rate worldwide will be well below the replacement rate of 2.1 children per woman (see graph below). If so, world population will be declining.
Predictions, can, of course, be wrong and, as we see, are subject to revision. Experience is leading to successively lower population estimates. The trend towards lower fertility with greater affluence is the exact opposite of Malthus’ assertion that population will grow as resources grow and always outstrip resources. Hard for him to imagine either effective birth control or women being in control of reproduction. Lower and lower population growth is already baked in for the next few decades because there are simply fewer women of child-bearing age and below than there were (the number of men is largely irrelevant).
China is a prime example. Its population has already peaked and is poised for precipitous decline. The one-child policy and the preference of parents for a male child doomed it to shrinking population for at least the rest of the century.
So what’s this all mean?
There is some significant bad news. As the populations age rapidly, there are less and less working people to support each of us retired geezers. Social security trust funds are in danger. Even if we saved enough for retirement, who is going to grow the food and make the goods we still consume? Who’s going to fix stuff that breaks? Less workers and more consumers means… inflation.
But there is more good news. Eventually declining populations need less food and goods. For a while total demand will increase as populations come out of poverty; but, as populations eventually decline, demand stabilizes and then decreases.
We won’t have as many workers but those we do have will be more productive because of technological progress in energy, agriculture, manufacturing, transportation, communication, and logistics. After a painful transition, we can have a world of abundance. Abundance means… deflation. Sure, as goods get cheaper there will be some increase in demand, but it’ll be easily satisfied.
The future will be very different and can be much better!
One example: Today we have a critical shortage of lithium to make batteries; that’s a real problem because we need so many new batteries. But fast-forward twenty years to when all cars are electric and the car population is shrinking rather than growing along with the human population. Lithium is close to 100% recyclable so lithium from retiring batteries is sufficient for new batteries. Almost no mining required. Yes, we have to get through the next couple of decades; but then the problems really do shrink and disappear.
Another example: as food poverty (which is largely a problem of war, corruption, and logistics now) is solved and population declines, less acres need to be in agriculture. More acres can be reforested. Net greenhouse gas emissions go down. Less yield is needed per acre so less pressure to use fertilizer and pesticides. Spot delivery of nutrition and protection by GPS-guided farm tools also reduce the impact of agriculture. Nirvana so long as we can get there.
And energy: demand will shrink both with population and continuing technical progress. My 100-watt incandescent bulbs are replaced with 6 watt (or less) LEDs. The fuel efficiency of gasoline cars has greatly increased; electric cars need even less energy. Direct drive motors are more efficient than their predecessors. Heat pumps, in appropriate climates, use much less energy than radiant heat per BTU generated. Natural gas is cheaper and less polluting than coal. Batteries will get better.
We have a transition problem, not an existential emergency.
We don’t have to do dumb things like turning one-third of our corn into motor fuel, blocking pipelines from where energy is found to where it’s needed, or slow-rolling drilling permits. We have time to build new, smaller nukes. We can and should continue to deploy wind and solar so long as we make sure there is a grid capable of sharing the load and sufficient backup whether that is battery, natural gas peakers, hydro, or something else.
It’s now obvious that Europe shouldn’t have out-sourced fossil fuel extraction to Russia. Knowing that population trends are already in favor of energy reduction, Europe should whole-heartedly (safely, of course) resume drilling and get fracking. More natural gas allows for more renewables.
Once we are free from panic induced by latter-day Malthusian prophets of doom (who are ignoring “the science”), we can deal with the immediate threat, Putin and his energy weapon, and the intermediate threat, too many geezers and too few workers, and plan our way to a future of abundance.
The author, an author, entrepreneur, former Vermont state cabinet officer, lives in Stowe. He founded NG Advantage, a natural gas truck delivery company. This commentary is republished with permission from his blog, Fractals of Change.
Categories: Commentary
Im will to barter my non-mrna sperm for your diesel or ammo…..
This article would have been better entitled – Free Enterprise will show us the way. It always does.
This is great info, but needs to be expanded to address the imbalance in the figures. For example, the potential for decline in the ‘rich’ north is well-documented. However, that decline is being offset by continuing growth in the poor south and east.
So, the aging mix in places like the US will create a lowering of goods demand (but an increase in service demand). That very decline means a lack of workers to deliver the services. Concomitantly, there will be excess labor in the poor south as their younger-skewed population has more babies leading to a birth rate above the 2.1 replacement rate. So we will have a demand for workers that can only be filled through immigration, and they will have an excess of people that can only be relieved by emigration.
So, if you think the pressure on the US border is high now, wait until you see it in 40 years time. Free enterprise will demand a lessening of border controls so that they can make money. You will notice that even today, the business lobby is not joining the calls for tighter immigration controls – they will move from that to an advocacy for much more open immigration as a way of driving down rising labor costs caused by scarcity.
Re: “Free enterprise will demand a lessening of border controls so that they can make money.”
If not Free Enterprise, what alternative economic system do you have in mind?
Well, since capitalism is the exploitation of man by man, then socialism is the exact opposite.
My way of saying I don’t have one.
My return question is ‘does the free market always work, and should it have any limitations?’
Re: My return question is ‘does the free market always work, and should it have any limitations?’
Of course Free Markets should, and do, have limitations. It is the rule of law provided by one of the greatest free enterprise forms of governance ever contrived by humankind – The U. S. Constitution.
Re: “Does a Free Market always work?” The question is… what do you mean ‘always work’. If it’s perfection you seek, no. But Free Markets are best in providing for the relentless pursuit of perfection.
Consider these points by one of the great Free Market thinkers of our time – Milton Friedman.
“Underlying most arguments against the free market is a lack of belief in freedom itself.”
“The society that puts equality before freedom will end up with neither. The society that puts freedom before equality will end up with a great measure of both”
“The great virtue of a free market system is that it does not care what color people are; it does not care what their religion is; it only cares whether they can produce something you want to buy. It is the most effective system we have discovered to enable people who hate one another to deal with one another and help one another.”
“There is one and only one social responsibility of business–to use it resources and engage in activities designed to increase its profits so long as it stays within the rules of the game, which is to say, engages in open and free competition without deception or fraud”
“The key insight of Adam Smith’s Wealth of Nations is misleadingly simple: if an exchange between two parties is voluntary, it will not take place unless both believe they will benefit from it. Most economic fallacies derive from the neglect of this simple insight, from the tendency to assume that there is a fixed pie, that one party can gain only at the expense of another.”
Re: “Well, since capitalism is the exploitation of man by man, then socialism is the exact opposite.”
If free market capitalism is based on the rule of law prohibiting fraud and deception, and one’s freedom to choose with whom one does business in that regard, anyone who is exploited has only themselves to blame. If someone doesn’t have a choice, it’s not a free market.
These graphs also “coincidentally” mirror the population that was vaccinated and boosted.
Let’s compare that to a graph of pure bloods. Bet the results would be interesting.
From 1960 onwards? Because that’s the period the graphs cover! OMG, it’s worse that we thought, we have been being vaccinated against a disease that didn’t even appear for 58 years! And Bill Gates was 2! The evil genius was at work from his `bouncy chair!
Thanks Jay for the comments. I would argue that the invisible hand is either partly or totally a fallacy. After all, much of what Smith wrote about was where governments should intervene. For example his extensive analysis of the Navigation Act.
Then, I would suggest that Marx and Smith were in broad agreement on many aspects, and that Marx and Engels essentially saw themselves as developing Smith’s thoughts. e.g. the accumulation of capital as a precondition of economic growth; the inevitability of class conflict in human history; the alienating effects of economic competition; the developing misery of the working classes under the bourgeoisie; the forcible defense of the private property of the capitalists as being the single role of State. All of these are Marxist.
So, essentially, Smith saw ‘invisible hand capitalism’ as an end-stage, while Marx saw it as a precursor.
Guzziman, your point on the now ancient English Navigation Acts is a classic false dichotomy. Interested readers should also study the Jones Act (1920). Neither Adam Smith, Milton Freidman, nor I, believe ‘market forces’ should reign supreme in every sector of the economy. This unregulated laissez-faire notion ignores the ‘rule of law’ that Friedman cited for the control of ‘deception and fraud’. And one size never fits all. Never has. Never will. Free Enterprise is NOT equivalent to anarchy. It is, within our rule of law, “the most effective system we have discovered to enable people who hate one another, to deal with one another, and help one another.”
Again, if your benchmark is perfection, Marxism is a consummate failure… by any measure. The adage that developed from Marx and Engles writings – ‘from each according to his ability to each according to his need’ – never included a concise description of how one’s ability and need were to be determined, or who would make the determination. Smith and Freidman explained that that responsibility rests with all of us, the marketplace (the so-called ‘invisible hand’), regulated by the rule of law that penalizes fraud and deception. And, by any measure, Smith and Friedman are still correct.
Thaks Jay! Enjoying this! But, deriding Smith’s usage of the ‘ancient’ Nav Act may be true now, but it was certainly apposite to Smith! I would suggest that any ‘bubble’ (South Sea, tulip bulbs, subprime mortgages, crypto) would imply that the invisible hand is a bit more blind than it is invisible. In each case the marketplace failed and governments either considered or actually did replace the invisible hand. Further, once Bear Stearns went to the wall, the ‘too big to fail’ process meant that the more egregious ones sins within the marketplace, the greater the likelihood that the government would bail you out. I see not dislocation between that and Marx’s theories on the concentration of capital and the concomitant risks.
I would argue that ‘marketplace’ truly only exists at an almost ‘retail’ level – applied to individuals (workers), but not to capital. At the corporate level socialism runs rampant with tax deals, subsidies, straight bailouts being par for the course, while increases in minimum wages are rejected. Amusing that the country with the greatest number of citizens that reject Charles Darwin wholeheartedly endorse ‘survival of the fittest’ as a social touchstone.
I’ll address your continued use of the false dichotomy (and there are several instances) one last time. Example: Darwin wasn’t describing rational behavior. To endorse ‘survival of the fittest’ as ‘a social touchstone’ is a meaningless statement in a free enterprise system governed by a rule of law that overtly prohibits fraud and deception. And there is nothing in the tenants of free enterprise that guarantees success. In fact, failure is a necessary aspect. For without failure, there can be no learning. And your citation of the Bear Sterns bailout is another case in point: It was anything but free enterprise. Crony Capitalism is not Free Market Capitalism. You should read Michael Lewis’ The Big Short.
Again, Free Enterprise isn’t the only socio-economic system employed by modern culture. But it is, by far, the most successful when it comes to improving our standard of living. If people can’t see that for themselves given the last 18-20 months of our current governance, they’re in big trouble.
P.S.
Re: Minimum wage – everything is relative and every time the minimum wage is arbitrarily increased (especially when it’s incremental) the very people who receive the ‘minimum’ increase are the ones who lose the most purchasing power. If, for example, you are a minimum wage earner (because you are less productive than other workers) and your wage increases let’s say 10%, what do your more experienced, more productive, and higher paid colleagues say? Unless they are working in a wage and price-controlled environment, they want (and deserve, because they remain more productive) a 10% wage increase too. So, the minimum wage employee receives $15/hr.. And the worker’s colleague already earning $15/hr. wants $16.50/hr.. And the worker already earning $16.50/hr. wants $18.15/hr. – and so on, right up the wage scale. In a short period of time these wage increases inflate the money supply and prices increase to cover the additional cost. And the very person the minimum wage is intended to help is the one who loses the most purchasing power.
Mathematically, if centralized planners (God forbid) wanted to make the low-income worker’s wages more equitable, they would legislate an across the board 10% cut in everyone’s pay. Relatively speaking then, the highest wage earners would have their pay cut the most.
So, good luck trying that scenario.
As with the adage ‘from each according to his ability, to each according to his need’, what is the best way to determine one’s ‘ability’ (i.e., productivity) and one’s ‘need’?
Why, a free enterprise market of course – in which a willing buyer (the employer) and a willing seller (the worker) come to terms that are mutually beneficial to their respective requirements. In a free market, that exchange between two parties is voluntary, and it will not take place unless both believe they will benefit from it.
Ah, but can free exchange of labor for wages occur in a monopsony? When the only people able to buy your labor are the bourgeoise who seek to classify it as a draw on their capital then it is hardly a competitive market. Additionally, could you not have a ‘free market’ where the benefits of excess labor value are subject to a more equitable distribution that the case where the margin accrues only to the provider of capital and not to the provider of labor?
BTW, fully agree with your citing of The Big Short and the statement that we actually operate within a system for akin to Crony Capitalism where it is not the market that picks the winners but the lobbyists and donors.
On a more mundane note, thanks for being willing to engage rather than just accuse me of being a ‘libtard’ and saying I want to vaccinate a fetus…
Re: “Ah, but can free exchange of labor for wages occur in a monopsony? ”
Okay… one more time. What monopsony? If there’s only one buyer, or one seller, free markets incentivize the creation of alternative markets based on whatever ‘the demand’ is at a given time? In fact, free markets often create new demands to take the place of old ones.
Again, you continue to move the goal posts with your line of questioning. A common rhetorical strategy. The point is, in a free market, there is always an answer to these moving targets. That’s the elegance of free enterprise. The same cannot be said for any other system. Which is why you don’t have a reasonable alternative to offer. All you do is test the free market waters with imaginative, if not contrived, hypothetical circumstances.
Rest assured… in a free market, reasonable people always find a way to improve themselves, and their neighbors too, sooner or later. Because it’s in their best interests to do so.
And I’m not claiming to be perfect either. At some point in your continued nonsensical line of questioning, I too may become frustrated by what is apparently a waste of my time and call you names too. Is that your strategy? Do you think I’ve never heard of Saul Alinsky?
Keep in mind… the other unique benefit to free enterprise is that we can choose, without prejudice, to not indulge one another.