In his excellent Basic Economics, Thomas Sowell argues that the fundamental principle of economics is scarcity. “Economics is the study of the use of scarce resources which have alternative uses.”
As Sowell says, that “may seem like a simple thing, but its implications are often grossly misunderstood, even by highly educated people”. Especially scientists – and most definitely including environmentalists.
The granddaddy of catastrophist environmentalists is without doubt Paul Ehrlich. This green Jeremiah has been waving his hands and screeching, “the end is nigh!” since the 60s. You’d think he would give up, when the catastrophes he’s predicated “within ten years” still haven’t come to pass after half a century. But no, he’s a persistent fellow. He’s certainly not about to let some upstart like Tim Flannery get the better of him in the “Consistently Wrong” stakes.
Back in 1980, economist Julian Simon bet Ehrlich $10 grand that a selection of scarce resources – of Ehrlich’s choosing – would be cheaper, not catastrophically expensive, in ten years. Ehrlich, who had just bet that England “will not exist in the year 2000” (spoiler: it did), eagerly took it up.
And lost.
Still, plenty of Malthusian doom-mongers are eager to follow in Ehrlich’s idiotic footsteps.
Pessimists often claim that human progress is about to come to a screeching halt. They say that the resources that make progress possible are about to run out, dooming us to a reversal in living standards. The Club of Rome, along with nearly every environmentalist, tells us that incessantly, usually pointing to a supposed mineral shortage that will end civilization. The pessimists insist that everything must be recycled and that we must have a completely circular economy. Alas, they fail to understand how the mineral industry actually works. On a deeper level, they fail to understand that humans have agency. We are not merely buffeted by the natural world but can solve problems ourselves.
Step up, the American Chemical Society.
The Society has a list of “endangered elements,” which they think might run out in the near future. The idea that we could run out of hafnium is enough to make geologists guffaw – I actually tried this once, and that’s what happened: not just giggles but proper belly laughs. Germanium, another on that list of likely shortages, illustrates my point even better. The world doesn’t use much of it, perhaps 150 tons a year. Some of that is recycled. (There’s nothing wrong with recycling, but insisting that we must recycle is wrong.)
To understand why we’re not about to run out of it, you need to understand what we use it for and how we get it.
We first started using germanium for electronics before we switched to using silicon computer chips. Germanium is still the material of choice for getting a warm and fuzzy sound on a guitar pedal, but today, germanium is mostly used for night sights and long-distance fiber optics. That’s because adding a little germanium to glass allows it to carry light for longer distances. So, we like having germanium around, and we would miss it if we ran out.
There are several ways to extract germanium, and they’ve been used at various times. At the moment, the preferred method is basically a by-production of electricity generation. Well, the sort of reliable, cheap generation the environmentalists hate: coal-fired.
To cut down on coal dust and its harmful effects, power plants use electrostatic precipitators on their chimneys to collect the dust. And extract germanium from it. The world’s largest germanium producer is a power station in China. It’s said that the germanium content in the dust is so rich that the company gives its electricity away, free.
The point of my germanium example is to show that we are not dependent on the current methods of mineral extraction, nor do we need luck to avoid shortages. We are tool-making creatures. If we have a problem, we study the world around us and develop a way to solve it.
Like germanium, every item on the ACS list of “endangered elements” actually has a vast current supply. The current mineral extraction methods might have problems, but the total amount of resources that we can use is imponderable. And if our current methods come up a little short, we’ll find better methods of extraction.
Human Progress
This is the same principle to bear in mind whenever environmentalists gibber about “peak oil”, or “peak” anything. “Known reserves” have just 20 years left? Perhaps – but that’s known reserves. Because what happens when minerals producers begin to run out of a known reserve? They look for new reserves.
It’s like saying known reserves of milk in my fridge will only last until Thursday. Because, of course, it’s simply impossible that I might go down to the shops and find even more reserves, waiting to be tapped.
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