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The ecologist view versus the economist view

Matt Ridley has an excellent article in the Wall Street Journal about the different ways economists and ecologists look at the world.


How many times have you heard that we humans are "using up" the world's resources, "running out" of oil, "reaching the limits" of the atmosphere's capacity to cope with pollution or "approaching the carrying capacity" of the land's ability to support a greater population? The assumption behind all such statements is that there is a fixed amount of stuff—metals, oil, clean air, land—and that we risk exhausting it through our consumption.

"We are using 50% more resources than the Earth can sustainably produce, and unless we change course, that number will grow fast—by 2030, even two planets will not be enough," says Jim Leape, director general of the World Wide Fund for Nature International (formerly the World Wildlife Fund).


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Reader Comments (49)

Luckily we have huge conferences in faraway places that thousands of 'oh-so-concerned' environmentalists can jet off to, at our expense, in order to find a solution to all this. Also, let us not forget those brave Hollywood celebs, and people like Al Gore, who are prepared to put their private jets to use in combatting climate change.

How lucky we are that the world is pulling together over such an important issue.

Apr 26, 2014 at 11:47 AM | Unregistered CommenterSteve Jones

Matt's article makes me very uncomfortable. It is just as wrong to believe in infinite resources and/or infinite substitution as it is to assume no adaptation or technology development. They both lead to bad societal decisions. The key difference is that the doom-mongers will be proved wrong long before the over-optimistic economists.
Matter may not be created or destroyed outside of nuclear plants, but its transformation still has to adhere to the Law of Entropy. Ask a chemist how easy it is to reconstitute a long-chain hydrocarbon after it is combusted.

Apr 26, 2014 at 12:27 PM | Unregistered CommenterPaul_K

It's interesting that Matt Ridley can refer to "The Economist" as belonging to the economist tribe. I reckon there are more environmentalists than economists writing for it these days.

Apr 26, 2014 at 12:28 PM | Unregistered CommenterColonel Shotover

We have had to listen to the doomsayers of environmentalism for nearly 50 years. Their predictions are always nonsense. In the WWII the best lies were half truths and the Green Taliban are expert at it.

The reading of past Green studies have never come to reallity. For example

Club of Rome's “The Limits to Growth” First published in 1972 my references are for 4th Printing 1978.

On page 193

“6. We are unanimously convinnced that rapid, radical redressment of the present unbalanced and dangerously deteriorating world situation is the primary task facing humanity. …....”

“7. This supreme effort of challenge for our generation. It cannot be passed on to the next. The effort must be resolutelyundertaken without delay, and significant redirection must be achieved during this decade. ….”

From the Figure 35: World ModelStandard Run on Page 124

“Population growth is finally halted by a rise in the death rate due to decreased food and medical services.”

From Figure 36: World Model with Natural Resource Reserves Doubled on Page 127

“Pollution rises very rapidly, causing an immediate increase in the death rate and a decline in food production.”

Slightly different bogeyman but same old alarmism. What have they achieved? Well the curtailment of DDT and the deaths of millions due to the malaria, hindering 3rd world economic growth and causing more deaths - amongst many others.

Apr 26, 2014 at 12:30 PM | Unregistered CommenterCharmingQuark

It was one of those in the 70s I think? Saudi Arabia will run out of oil by 2000 - panic. That'll be the VI's wanting more and OPEC went for it and I walked down an empty autobahn one Sunday in 1973 as a result. Under the guise of US aid to Israel and on and on. Just the VI's again!

In 1980 I was in a Saudi Bank speaking to the Saudi manager over buckets of chi. I asked about business in the bank and he mentioned sponsoring drilling for water. I said that was useful and he said, not really they find only oil. So,not pleased at all.

They moved to big De-Sal PDQ in Jeddah. Something UK was told to do way before that and simply because it was cheaper to build then than anytime much now. VI's again ?

Apr 26, 2014 at 12:45 PM | Unregistered CommenterEx-expat Colin

The most striking thing about Matt Ridley's viewpoint is his underlying optimism. This is in sharp contrast to the overwhelming pessimism of his critics. There is always the Panglossian danger, but that largely stems from a passivism in the face of obvious problems. Active pursuit of efficient and effective solutions to major problems should be encouraged: While free markets are seldom sufficient to guarantee these solutions, eliminating them certainly reduces the likelihood that such solutions will keep flowing.

Apr 26, 2014 at 12:45 PM | Unregistered Commenterbernie1815

On the subject of improved use of resources, I read a book recently which was about the old Ford Prefect, Anglia and popular range of cars that were designed in the 1950s. The book reproduced magazine road tests on the cars and I was surprised to find that the cars averaged 30 miles per gallon and that this was considered to be quite impressive. My current car is a Saab 9-3 estate. It is a 1.9 turbo-diesel and a huge great barge of a car. It averages 45-50 mpg, half as much again as a tiny little Ford from the fifties.

I noticed that the article cited Paul Erlich. Of all the doom and gloom merchants, surely he must be the one who has been the most consistently wrong. Yet there appear to be people who still listen to him.

Apr 26, 2014 at 1:15 PM | Unregistered CommenterStonyground

CharmingQuark: and they "achieved" something else. Trying to reconcile their perceived need to address the "unbalanced and dangerously deteriorating world situation" with the unavoidable demand by the poor for economic development, they invented the concept of "sustainability". Thus they brought the poor on board by dividing the world into two categories - the developed and the undeveloped/developing. The latter were exempt (at least - as they saw it - for the time being) from the environmental constraints they were determined to impose on the former. That was 40+ years ago. But the bifurcation is still in place and the latter (now including some of the most powerful economies on the planet and responsible for 70% of GHG emissions) are still insisting on exemption. And that's why environmentalists are now struggling to come to terms with the harsh reality that - whatever the "science" might say - GHG emissions are not about to be reduced.

Apr 26, 2014 at 1:32 PM | Registered CommenterRobin Guenier

Two words which have not been mentioned yet, and which should be the first port of call in any discussion about resource depletion.



Apr 26, 2014 at 2:35 PM | Unregistered CommenterDodgy Geezer

"Matter may not be created or destroyed outside of nuclear plants, but its transformation still has to adhere to the Law of Entropy. Ask a chemist how easy it is to reconstitute a long-chain hydrocarbon after it is combusted."

Transformation? That's what we humans do and have been doing since the dawn of time. We take energy from the sun (either directly or indirectly) and use it to do that work. A recent example:

This particular system may or may not be currently significant but the logic is fine.

Apr 26, 2014 at 2:54 PM | Unregistered CommenterAlleagra


...I noticed that the article cited Paul Erlich. Of all the doom and gloom merchants, surely he must be the one who has been the most consistently wrong. Yet there appear to be people who still listen to him...

If Paul Erlich passed me in the street and said 'Good Morning', I would reach for my umbrella...


Matt's article makes me very uncomfortable. It is just as wrong to believe in infinite resources and/or infinite substitution as it is to assume no adaptation or technology development. They both lead to bad societal decisions. The key difference is that the doom-mongers will be proved wrong long before the over-optimistic economists.
Matter may not be created or destroyed outside of nuclear plants, but its transformation still has to adhere to the Law of Entropy...

Matt is using (though not explaining in detail) Paul Simon's Cornucopia theory. This posits that 'resources' are not physical items such as copper ore. Resources, in Simon's theory, are comprised of two parts - Raw Materials and Human Ingenuity. Individual examples of Raw Materials are indeed finite, but in Simon's view, Human Ingenuity is infinite. Thus multiplied, resources become infinite.

An example is that of oak trees in the UK around 1600. You could readily show that the Navy's requirements would exceed all possible replenishment by perhaps 1800, leaving Great Britain at risk from invasion. And yet by 1900 we had the largest navy in the world. This happened because human ingenuity enabled us to make ships from steel - a substance not considered for structural work before. Ingenuity is by definition unpredictable before it happens, but we know that it has never failed us yet.

You can consider us limited in one respect. The Earth is about 300 billion cubic miles of mostly Iron and Silicon. I don't know how soon that will get used up. It won't 'run out' of course, because it will be recycled, but it could, I suppose, all be used for making things. Well before then, of course, we will be getting our methane from Titan...

Apr 26, 2014 at 3:04 PM | Unregistered CommenterDodgy Geezer

...Matt is using (though not explaining in detail) Paul Simon's Cornucopia theory...

Whoops - senior moment. For Paul read Julian...

Apr 26, 2014 at 3:16 PM | Unregistered CommenterDodgy Geezer

But only for the second Paul...

I'll get my coat...

Apr 26, 2014 at 3:17 PM | Unregistered CommenterDodgy Geezer

"It is just as wrong to believe in infinite resources and/or infinite substitution as it is to assume no adaptation or technology development."

The problem is that people are misinterpreting what the Cornucopians mean by "infinite". The best explanation I know was by the economist Henry George in response to Thomas Malthus: "Both the jayhawk and the man eat chickens; but the more jayhawks, the fewer chickens, while the more men, the more chickens."

The question you have to ask yourself is, in George's sense, are chickens a finite resource? They're clearly finite in the sense that at any one time there is a finite number of chickens, but they're 'infinite' in the sense that you'll never actually run out of them - or at least, not until the heat death of the universe, which is close enough to 'infinite' for the purposes of economic planning.

The Julian Simon argument is that other resources work the same way. We won't ever run out of resources because resources (like chickens) are effectively manufactured by humans. The only way we could run out of them is if we stopped making them; if we shut down industry and innovation and technological development - which ironically is exactly what the Greens are trying to bring about.

"Ask a chemist how easy it is to reconstitute a long-chain hydrocarbon after it is combusted."

A chemist will reply that it's pretty easy with the Fischer-Tropsch process. Water is split by electrolysis into hydrogen and oxygen. The CO2 reacts with hydrogen over a cobalt catalyst to produce methane, which subsequently reacts with more hydrogen to form longer chains. The Germans used it in WWII to produce about 9% of their liquid fuel, and we used to use a very similar process to produce 'coal gas' from coal, so it's certainly feasible to do at an industrial scale. It does, of course, require a lot of energy input.

Apr 26, 2014 at 3:38 PM | Unregistered CommenterNullius in Verba

On the Thorium discussion thread Adrian posted a number of links to documents and presentations on Youtube. I found this one by Dr Joe Bonometti as a Gooogle Tech Talk particularly interesting. I haven't got through all the links yet as some are quite lengthy. The ones I have viewed/read do cover the amount of energy available from Thorium and how it could be used.

Apr 26, 2014 at 3:54 PM | Unregistered CommenterSandyS

The Stone Age Didn't End Because We Ran Out of Stones
-- Sheikh Yamani, former OPEC oil minister.

Apr 26, 2014 at 4:38 PM | Unregistered CommenterRoy

How peculiar, just yesterday I was reading a piece by Tim Worstall in Forbes that references Roger Pielke Jr, and an The Economist report and covers most of the same ground.

I was distracted from my original search for an old document (1800's financial report) that the world was going to run out of copper, I saw reference a couple of years ago to it but as is me, I forgot to bookmark or make a note of it. I never did find it.

I believe man's ingenuity will win out as carbon (the element, not the misnamed contraction for CO2) and the amazing properties of nanotubes becomes more important in all technologies - semiconductors including solar cells, building materials, chemical and water purifying filters, improved batteries,etc...
Great stride are also being made in organic chemistry where plastic, and plastic-like materials, better and cheaper video displays may be made, flexible batteries etc...

Apr 26, 2014 at 4:54 PM | Unregistered Commentertom0mason

Extrapolating from the present often gives ridiculous forecasts.

I remember, I think in the 1970s, that it was said that if we were still using manual telephone exchanges, the USA would have needed three times the population to man those exchanges. It must be be many times that now!

And wasn't the UK mobile phone market going to be way below 10,000 subscribers, or the number of mainframe computers Britain required was going to be no more than five?

The problem is that the Alarmists have used political power to push forward spending plans based on very dubious science, with Al Gore's video rushing the debate so that we are basing decisions on a political wish list.

There are people whose job it is to turn user requirements into products, in return for profit. They are called Engineers and they work in the Private Sector, where success is rewarded by profit and failure by looking for another job. Grants/subsidies are a good way of funding research and prototyping, but not for production systems, as we are for windmill power! And cementing rubbish Science in an Act of Parliament is beyond belief!

If the discussions had developed as they should have done, we could have had the research, development, prototyping and implementation done, in the right order, with more opportunity for those with appropriate knowledge to determine which path to follow. There are so many possible avenues that could be followed, and so many combinations, but they have been squashed by directing the available funds towards bird chopping windmills and bird frying solar mirrors that cannot deliver a secure electricity supply.

It must be very difficult to start and run any Environmental project with a credible Science/Engineering basis when also having to pretend to believe in CAGW, the evils of carbon, or even carbon dioxide, in the atmosphere, and trying to save the polar bears, and all at the same time!

Politicians should be creating the political infrastructure that will allow Scientists, Engineers, Economists, Mathematicians and others, to see what can be done. It is what has happened, successfully, for centuries and there is no reason why human ingenuity cannot continue to solve the world's problems, given the right conditions.

Apr 26, 2014 at 5:14 PM | Registered CommenterRobert Christopher

Go over to BreitBart…breaking info now, somebody said something anti climate change…oh dear!

Apr 26, 2014 at 6:20 PM | Unregistered CommenterEx-expat Colin

Paul_K wrote, "Ask a chemist how easy it is to reconstitute a long-chain hydrocarbon after it is combusted."

Better to ask a farmer.

Apr 26, 2014 at 6:52 PM | Unregistered CommenterSpeed

I hadn't come across the article about running out of copper but I did come across the conference in New York in the late 1800s. There was a real panic as they had worked out that in 20 or 30 years time there would be so many horse droppings that roads would be blocked to about half a mile high.

I concur with the Julian Simon comments. I think it was Tim Worstall who came up with the most easily understood comment. If you consider that silicon as the raw material is like a loaf of bread. When we started making silicon chips you cut off what resembled a thick slice. Nowadays you cut off only a atom's thickness. We do not have any more of the raw material but we have found better and more efficient ways of using it.

Apr 26, 2014 at 6:52 PM | Unregistered CommenterDizzy Ringo

As with all green alarmist "facts", follow them to the source and you will find they are pure nonsense, made up by their fellow travellers in pursuit of an agenda.

You can, as Lomborg did with some of them (in the process earning vilification from his fellow greens) trace them back to their origins, or you can often just apply a simple sanity check - "Is it realistically possible that we can measure this or likely that someone has?" If not, somebody made it up.

Apr 26, 2014 at 8:23 PM | Unregistered CommenterNW

Two points: supply is determined by price. If there is sufficient demand price rises and we mine asteroids, tow ice bergs to California and ship LNG to Japan.

Second point - we are on the cusp of a second (or is it third) materials revolution lead by applications of Graphene and other nano materials.

Apr 26, 2014 at 11:39 PM | Unregistered CommenterJay Currie


(1) finite raw material x human intelligence = infinite resource.
The Stone Age Didn't End Because We Ran Out of Stones = Human intelligence developed new materials and construction techniques.

(2) finite raw material x environista/warmista intelligence = finite resource.
The Stone Age Didn't End Because We Ran Out of Stones = Neanderthals disappeared fearing a lack of stones in the future.

Apr 27, 2014 at 12:58 AM | Unregistered CommenterStreetcred

Can someone remind me, did the Viscount become an optimist before or after he destroyed the bank his Daddy gave him?

Apr 27, 2014 at 1:21 AM | Unregistered CommenterHeide de Klein

I have written a book about this with another coming. Admittedly not an easy read, since fact laden. Ridley is right about economics and substitution, yet wrong about production progress versus exponential population growth rates. This comes push to shove by 2050. Limits on food production are a combination of many different limits, gone into in boring detail. Then there is peaking liquid transportation fuel ( not all fossil fuel). There are no presently foreseeable outs, including biotech and nuclear electricity.

Apr 27, 2014 at 2:57 AM | Unregistered CommenterRud Istvan

I am reminded of the hungarian who won a trip in a schools competition to the new oil refinery in Pest in 1927.
The Manager said that the oil industry was very exciting, but that the oil would run out in 20 years.

In 1932 he graduated as an engineer and started work there. The Personnel Manager explained that the job was "short term" because the oil would run out in 20 years.

In the late 40s (after some adventurous times) he was one of a committee of oil experts who reported to Congress that oil would run out in 20 years. In the 60s and 70s there were predictions of oil running out in 20 years. These were repeated in 1982, 1985, 1987 etc.

So we will run out of oil in 20 years. The only uncertain thing is when those 20 years start!

Apr 27, 2014 at 5:14 AM | Unregistered CommenterGraeme No.3

re Bernie1815's comment, it is useful to remember that Dr Pangloss (and Voltaire) did not use the word "optimism" in the way we use it today, almost the reverse. Pangloss thinks that this world is perfect, because God made it (Voltaire was mocking Leibniz's theodicy), so not only are bad things actually good (earthquakes kill lots of sinful people) but it CANNOT GET ANY BETTER. It's "optimal" already: hence the word "optimism". That's roughly what environmentalists say today: any change must be for the worse. Pangloss would have joined Greenpeace...

Apr 27, 2014 at 8:22 AM | Unregistered CommenterMatt Ridley

From the Ecclesiastical Uncle, an old retired bureaucrat in a field only remotely related to climate with minimal qualifications and only half a mind.

re Rud Istvan's exponential population growth rates. There is too detail in the post to make any credible criticism of any implication that world population is bound to grow exponentially and that implication may not be intended.

But some facts (possibly, of course, inaccurate/just plain wrong):

(1) Population is migrating from rural villages to conurbations. World Bank figures show that round 1960 there were twice as many people in rural areas as there were in cities; by 2008 numbers were equal; and by 2020 there will be nearly 50% more people in cities.

(2) Birthrates in towns are lower, often dramatically. Anacdotal but reliable information from a small sample available to me suggests by 50 to 80%. The same World Bank report states urban populations will increase at 1.8% while total world population growth will be 1.0%.

It is conceded that these figures imply exponential growth but it is plain from the report's graph that these figures are the result of forcing the data to conform with an exponential model, and that actual total population growth would be far more accurately characterized as linear.

Nobody knows if the World Bank's figures and forecasts are reliable, of course, but they do throw huge resources into this sort of work. In the absence of anything evidently more reliable, I would suggest these figures are the best we have.

Apr 27, 2014 at 9:21 AM | Unregistered CommenterEcclesiastical Uncle

Apr 27, 2014 at 1:21 AM | Heide de Klein

One bank is nothing, the greens would destroy whole national economies given the chance.

Apr 27, 2014 at 9:26 AM | Unregistered CommenterSteve Jones

To all those people above who are able to so confidently predict the future...please can you let me know the Lotto numbers for next week.



Apr 27, 2014 at 12:02 PM | Unregistered CommenterEnnGee

"To all those people above who are able to so confidently predict the future...please can you let me know the Lotto numbers for next week."

A report by environmental scientists for the charity 'Peak Balls' has recently raised the alarm over the future of the much beloved National Lottery.

"I fear there is only a finite supply of lottery numbers, which means we are going to run out of them very soon," said campaign spokesperson Verdant Citrullus. Environmental scientists calculate that at the rate we are using them up (a totally unsustainable 7 per week!) we are going to exhaust the supply in about 7 weeks time.

"We desperately need more funding to raise public awareness of this critical issue", added Ms. Citrullus, "The government has devoted virtually no taxpayers resources to this issue. It's simply unsustainable!"

The charity has proposed rationing the supply to three lottery numbers per week until an environment-friendly alternative source of fresh balls can be found. The shadow Chancellor speaking for the opposition deplored the low level of science funding devoted to developing new supplies of balls and called on the government to increase spending forthwith. However, a government spokesman responded saying that the Office for National Statistics would be more than capable of keeping up the supply of random lottery numbers and that the general public shouldn't worry. "Scaremongers have been predicting the imminent exhaustion of government-supplied balls for generations," he added, "but we still seem to have a plentiful supply."

Some commentators have pointed to private Bingo halls as a possible alternative, noting how private industry had expressed no concerns over supply, but this was strongly condemned by the Peak Balls spokesperson. "Private enterprise is only interested in profit! They run through bingo numbers at a rate of thousands per week, with no thought for the future! Do they invest in research? Do they import the lovingly hand-crafted sustainable ethnically-ethical organic bingo balls we ourselves have been promoting? No! They use these mass-produced plastic horrors! They're just out to strip the resource for profit as fast as possible and move on when the supply is exhausted! They rape and despoil the environment!! The world is fast running out of time to act!!!"

The interview had to end at that point, as Ms. Citrullus had to go and have a lie down. But the issue remains. For how long can things continue as they are? All resources are finite, and lottery numbers can surely be no exception. For the sake of the children, and of our great, great grandchildren who if nothing is done may one day grow up in a depleted, lottery-free world, surely we should be seriously considering this desperately serious issue now?

Apr 27, 2014 at 2:18 PM | Unregistered CommenterNullius in Verba

Regardless of your interest in population growth, this is a superb talk about statistics - well worth a look!

Apr 27, 2014 at 2:53 PM | Unregistered CommenterPolitical Junkie


:-D LOL!


Apr 27, 2014 at 2:56 PM | Unregistered CommenterEnnGee

'To all those people above who are able to so confidently predict the future...please can you let me know the Lotto numbers for next week.



Apr 27, 2014 at 12:02 PM | Unregistered CommenterEnnGee'

For that you will need to contact the CRU at the UEA, the Met Office or the IPCC. Only they have the predictive powers required for that task. Beware that some numbers might prove wrong in the short term due to averaging of model runs but, eventually, you will win the jackpot.

Apr 27, 2014 at 3:26 PM | Unregistered CommenterSteve Jones

Related, and a good short read:

Apr 27, 2014 at 3:55 PM | Unregistered CommenterDavid, UK



Apr 27, 2014 at 4:41 PM | Unregistered CommenterPaul_K

@Nullius in Verba and @speed

"It does, of course, require a lot of energy input."

That was rather the point of my comment about the Law of Entropy. Speed's response ("Ask a farmer") was witty, and almost correct if you loosely count tryglycerides as long-chained hydrocarbons.

Of course, the conversion of natural gas to methanol, paraffin, syn-diesel and middle-distillates is possible. In fact, there are a variety of known processes for the production of diesel equivalents from gas, some of which can be done without Fischer-Tropsch, but they are all energy intensive.

I have just been looking up subsidies for bio-fuels. According to the Worldwatch Institute report ( annual global subsidy (ref 2012) for total biofuels (ethanol and biodiesel) amounted to US$20bn. Total production amounted to about 600 million barrels of oil equivalent. If my sums are correct, this represents an AVERAGE subsidy of a staggering $36/bbl, or over a third of current benchmark crude price - and here I am being generous on the conversion since 80% of the liquids fuel was actually ethanol, which should be discounted for calorific value. Actually biodiesel in the US receives a "blender's credit" which corresponds to about $42/bbl for producers using the main feedstock - virgin soybean oil. Even with this subsidy, it typically cannot compete with wholesale diesel prices. So basically it just doesn't make any money and the existing capacity is often shut down. Biodiesel still represents a tiny fraction of total transport fuels at less than 0.4%. Total liquid biofuels including ethanol represents less than 2%.

With respect to gas-to-liquids conversion, there is now a very large differential in price/energy unit between liquid fuels and methane gas in all the major markets. Additionally, there are large volumes of stranded gas around the world, and diesel is expensive, so the circumstances couldn't be better could they? To date, AFAIK, investment at industrial scale has occurred in only two places - by SASOL in South Africa and Shell in Malaysia. They produce less than 0.3% of total liquids fuels. Reformation to produce syngas requires a lot more total energy than the gross calorific value of the final product. If a partial oxidation process is used one can reduce the energy loss to about 40%, but this then requires the additional capital costs of a cryogenic plant to produce oxygen. Estimates from Shell indicated capital cost estimates (i.e. before budget overruns) of around $30,000 per bbl per day for their MDS (Malaysian) plant - a cool $5bn of front-end capital investment - and they then have to buy about 10,000scf of gas (energetically equivalent to 1.6 barrels of oil) to produce every barrel of liquid fuel.

Gas-to liquids cannot work without a large differential between oil price and gas price. Really cheap natural gas cannot happen other than in remote areas away from a mature gas market. Even in such areas, this type of project will compete with other alternatives like new pipeline installation, an LNG export scheme, acetic acid production etc. Last but not least, the magnitude of capital investment requires that the investors can trust government guarantees regarding feedstock availability, pricing, profit -sharing and tax structure. It is not uncommon for such guarantees to be "renegotiated" by governments after the front-end capital investment has been made, so these projects carry potentially a high political and commercial risk.

I have no doubt that when oil prices hit $200/bbl we will see an increase in these types of schemes as well as improved conversion technology, more electric cars, more fuel-efficiency, increased use of alternative fuels like CNG, more economically enforced use of public transport, as well as other forms of substitution for liquid transport fuels. However, given the lead times for a lot of these things, I just don't think that it is intelligent to believe that human ingenuity is going to solve this problem easily or equitably. And certainly not on a global level. In fact, I don't think the problem will truly be solved at all. Even on a nation basis, we are not structurally well organised to solve problems of this type. On an international level it is hopeless. Instead, the richer nations will continue to increase their trade deficits until they can substitute piecemeal for the next least costly alternative to buying crude, and the poorer nations will find themselves walking a lot more.

Apr 28, 2014 at 4:37 AM | Unregistered CommenterPaul_K

Does there seem to be an about face in Germany re the Energiewende? Economic policy seems to be winning over green energy after Sigmar Gabriel (Germany's Economic Minister) claims that the EW is 'on the verge of failure'.

Apr 28, 2014 at 7:59 AM | Unregistered CommenterIan G

I wonder if anybody remembers the TV series Doomwatch? It was fictional drama which extrapolated the various concerns of environmentalists and showed worst case scenarios, e.g. a plastic eating bug which destroyed an aircraft in flight. What was unintentionally revealing was the relish with which these disasters were portrayed, especially when innocent people lost their lives.

Apr 28, 2014 at 10:35 AM | Unregistered Commentermike fowle

Your Lordsip (Ridley)

Some people, given the ready evidence and perforrmance of large scale peaceful nuclear power, object to its further use or expansion.
Such people thus display a serious deficit of critical thinking and problem analysis.
I do not read the contributions of such admitted people, to the public debate, any more than I read those who write about bounteous virgins in a mental heaven.
Please, Sir, are you able to state your current position on nuclear, hopefully beyond the bumper sticker immaturity, because you appear to have a brain that fumctions well at times.

(I became involved in nuclear matters soon after my 20 year employer discovered Australia's massive Uranium deposits at Ranger One in the NT of Australia in 1969 and started a new chapter of the nuclear book.
I have uncovered several influential people whose hidden agenda is that extended delay is as effective as cessation. Such people, not to mince words, I class as treasonous. Sir, I am not insinuating that you are.)

Apr 28, 2014 at 11:22 AM | Unregistered CommenterGeoff Sherrington

learning english here: a lordsip is that a lordship on the sauce?

Apr 28, 2014 at 1:07 PM | Unregistered Commenterptw

I think the islamist 64virgins premise can EASILY be attacked. Just invite each and every one of those mullahs with a 1+ nights stint with just one of those promised virgins. The adder under the grass is in the "+".

Apr 28, 2014 at 1:16 PM | Unregistered Commenterptw

"However, given the lead times for a lot of these things, I just don't think that it is intelligent to believe that human ingenuity is going to solve this problem easily or equitably. And certainly not on a global level. In fact, I don't think the problem will truly be solved at all."

What does the lead time have to do with whether or not the problem will be solved?

Compare the technology we had in 1900 with the technology we had in 2000. That's the sort of difference in engineering capability we're talking about. People rode around on horses back then. The poor countries will be much wealthier; likely close to where we are now. Technology will be vastly different on both the supply side (what will nanotechnology and synthetic biology do for energy generation?) and on the demand side (many energy-hungry processes will get more efficient, or be replaced). Personally, I don't believe it is intelligent to assume that it won't happen, given the recent history of our technological trajectory.

But we don't even have to speculate about possible future technologies. We have the technology to do it now. And if you look at how fast we ramped up production in say WWII, with only 1940s technology, I don't see how we would be any slower about it if we chose to do so now. We could switch over to nuclear power in a decade or two - France did - and we could produce much of our liquid fuels from coal - Germany did - and we could make more clean water with nuclear-powered desalination and grow more food with nuclear-powered hydroponics stacked in garden skyscrapers, and we could do all of that with technology that existed 30 years ago.

We almost certainly won't, because we don't need to. We're not running out of fossil fuels (coal, oil, or gas). We're not running out of water (on a planet 2/3rds covered with the stuff!). We're not running out of food. We're not running out of metals or minerals or phosphates. We're not - as the inventors of the landfill tax seem to think - running out of big holes in the ground. We don't need to cut back. We don't need to recycle. We don't need to change the rate or direction of technological progress, or dismantle market capitalism, or regulate industry.

Our biggest danger is from stopping. We are leaping from stepping stone to stepping stone - each of them lasting just long enough for us to jump to the next one. So long as we keep moving, keep changing, we'll not run out of anything. But if we stop dead, and wait for the stone we stop on to sink, we'll have a much harder job starting again and trying to reach the next one. The main obstacle blocking our solution to all of these problems is the Greens. They don't like 'chemicals'. They don't like nuclear power. They don't like fossil fuels. They don't like fracking. They don't like genetic engineering. I doubt they're going to be all that keen on nanotechnology when it gets going. They don't like people solving the problems they are always wailing about.

And conversely, any technology that is so useless that it offers no solution at all, they love, and want to spend lots of other people's money on. Any way of making things less efficient, more primitive, more expensive. It's hard not to imagine that it's deliberate.

Apr 28, 2014 at 7:03 PM | Unregistered CommenterNullius in Verba

Paul K,
There is a bit more to GTL than you say. Shell's malaysian project was followed by the much bigger "Pearl" scheme in Quatar (I think). It is the source of their "V-max" diesel across Europe. They were planning a similar monster project in the US but have postponed it due, apparently, to cost concerns as US construction costs are exploding, much as Australia's did a few years ago.
Also "mini-GTL" plants are being developed by companies to address the stranded gas issues in places like the Bakken.
On the wider issue, there have been comments recently to the effect that supply of oil in the US could outstrip demand unless the price drops, which would have global ramifications. This is due to both the enormous increases in production - which show no signs of slowing - and the growth in substitution: LNG and CNG for trucks and railroads, etc..
Alongside that China is moving very fast into gasification, both for gas products and liquids, and into shale gas. They already use 170m tons per year of coal for gasification and there are many more projects in development. The Saudis have a power station just commissioned which runs on local shale gas - with more to follow - to free up more oil for export.
It looks as if the oil price is already high enough to drive diversification - together with other pressures like security of supply and indigenous production.

Apr 28, 2014 at 10:47 PM | Registered Commentermikeh

Paul Krugman wrote:
"And it’s not just policy debates. Whole subfields of economics, notably but not only business-cycle macro, have spent decades chasing their own tails because too many economists refuse to accept empirical evidence that rejects their approach.
The point is that while Chetty is right that economics can be and sometimes is a scientific field in the sense that theories are testable and there are researchers doing the testing, all too many economists treat their field as a form of theology instead."

Of course this is true for many, if not most, of the soft sciences. Until and unless there is some kind of institutionalised common-sense hardwired into the system there will continue to be bad policy arising from the over-hype of simplistic 2-variable, linear theories that have no empirical support from complex, noisy nature.

Apr 29, 2014 at 9:06 AM | Unregistered CommenterJamesG


Thanks fro the correction. In fact, my post was confused on several factual issues. I quoted some numbers for Pearl which I then attributed to Shell's Malaysia GTL.

Pearl GTL in Qatar, a JV between Shell and Qatar NOC, was brought onstream in 2011 and produces 140 thousand barrels per day from 1.6 billion cu ft of feed. Initial capital cost estimates were for $5bn (equivalent to $30,000 per barrel per day). Final costs came in between $18bn and $19bn (equivalent to $130,000 per barrel per day). Ouch.

SASOL also has a (small) JV with Qatar NOC, which I didn't know about.

So there are at least four GTL plants onstream operating in three different countries, but my total global production (liquids from GTL equals "less than 0.3% of total liquids fuels") came from a separate source and includes Pearl. It appears to be valid as far as I can tell.

I agree with you that the oil price is already high enough to drive diversification, and has done. It has also stimulated exploration activity, as well as allowing high cost hydrocarbon production to be brought on stream. I don't doubt that this will continue.

Apr 29, 2014 at 5:19 PM | Unregistered CommenterPaul_K

"We are using 50% more resources than the Earth can sustainably produce, and unless we change course, that number will grow fast—by 2030, even two planets will not be enough,"

Aren't we lucky to have eight then? Or 9 if you count Pluto. Or 638,835 if you include known minor planets. We may have increased shipping costs, delays and extended commutes but no resource shortages. Nice to see Leape supporting the space programme.

Apr 29, 2014 at 11:17 PM | Unregistered CommenterAtomic Hairdryer

WE live on a finite planet of limited resources and anyone who thinks it can sustain exponential growth forever is madder than a box of frogs.

WE will reach limits - we ARE reaching limits, of one sort or another - every single day.

Its like climate change, its not about whether its happening or not ore even whether CO2 makes us warmer. Its about how much in what time period.

IN 14 years central heating oil has risen and average of 12% a year outstripping general inflation massively.
It is getting to the point where even electricity and a heat pump, discounting the cost of installation matches it.
I personally am well past 'peak oil'

And poorer as a result.

Copper is so expensive that its no longer the material of choice for plumbing. Plastic pipe abounds.

Cornucopianism is a delusion.

And the straw man argument of the Cornucopians that by imagination alone we can always find more stuff and will never run out is exactly that - a straw man.

As if one day a sooty miner holds up a lump of coal and says 'that's it, the last coal ever to be mined in the world.

These are not the hard limits of 'running out' they are the soft limits of 'not worth extracting'. Either because the next least worse thing is now cheaper, or because the benefit of extraction is exceeded by the cost of so doing.Oil that takes more oil to extract in terms of drilling transporting and refining than you will get from burning it, is pointless TO extract for energy.

These are SOFT limits, marked by rising inflation, falling living standards, lower growth in economies..and increasing debt...sound familiar?

Its possible to plot these curves of growth versus resource expense in general shape quite easily.

You star off with exponential growth and good GDP to debt ratios as small investments pay off handsomely as the low hanging fruit are plucked, and general wealth increases..than it begins to slow, and more debt is invested to produce less tangible returns and so prices must rise, and as prices rise demand falls, and you get not exponential expansion but almost no expansion at all..and then the curve peaks and starts to fall back.

Limits to Growth is mostly right in the shape, but the time scales and actual levels are highly modified by technological advances. And the 'solutions' are of course arrant nonsense.

But make no mistake, we are within sight of peak oil, at least and may actually have passed it.

There is of course stacks of uranium and thorium that is already intrinsically cheaper than oil, when shorn of needless rover regulation.

Primary energy is not the limit that will prove to be crucial. I dont know what is, but you can think of cheap water, agricultural land, agrochemicals - already we are operating at lower yields than we used to because agrochemicals are expensive and the cost-benefit ratio of high doses is negative..many mineral elements are in short supply. AND therefore very expensive.

We will in the end adapt or die, or most likely both. Technology is in fact a very very narrow discipline encompassing the very very few things we have found that actually work. It is not something you throw money at and miracles pop out the other end. It has to stay within the laws of physics.

I think one calculation showed that if the human race continued to expand exponentially at 20th century rates with even a fairly heavy reduction in per capita energy use, in a couple of hundred years the earth would be generating through human activity more energy than it gets from the sun.

Now that WOULD be scary climate change.

Its a stark choice between educating people not to have too many babies, (the libertarian approach) providing compulsory abortion (the Left/Green Big state approach) or feathering your own nest and building a big wall and letting peoiple outside simply die in horrible ways (the fascist right approach).

But there is NO WAY that we can actually continue to grow population wise unless we want to all be holding our hands out to Bob Geldof, who wont be coming.

If the 19th and 20th centuries were the centuries of massive expansion fuelled by fossil fuel and technology, the 21st is where we see the end of that expansion.

The inconvenient truth is that Britain would be a really nice place for 10-20 million people to live in relative luxury powered by 30 decent reactors. At 100miilion its bankrupt, busted and will be like any 3rd world megaslum.

May 2, 2014 at 5:37 AM | Unregistered CommenterLeo Smith

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