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Everything is running out, buy while stocks last

The Guardian newspaper reports that two-thirds of the world’s resources have been “used up”, so with only a third left, the crunch cannot be far away for Planet Earth. (Let’s hope Hollywood is on the case). The splendid Cafe Hayek blog nicely chews up and spits out this Malthusian argument here.

I have a question. If the resources of the Earth are finite and everything eventually succumbs to the Second Law of Thermodynamics, then by the logic employed by the deepest of Greens, even if we recycle all our goods and live in mud huts, then at some point, the game is up, we are all doomed, the end is nigh. So my question would be that if this is so, then why not live life to the full and enjoy this “finite” world while we have it? Let’s get those SUVs, build those spacecraft, take those lavish holidays, create those new technologies. It is all going to end anyway, so enjoy!

Of course, the idea that resources are finite has been challenged by the late and much-missed Julian L. Simon. The Ultimate Resource is his masterwork. And what is the ultimate resource? You probably have guessed – the grey stuff between your ears.

41 comments to Everything is running out, buy while stocks last

  • Euan Gray

    The title of the thread is misleading, since the article doesn’t actually appear to say 2/3 of resources are exhausted, but rather 2/3 of the systems which support life are being degraded. This is a completely different matter.

    It is probably true enough, but not necessarily any reason for alarmist concern. Nothing is static, and these things would naturally change/disappear anyway, only to be replaced with others more suited to the changed environment. This is called evolution, and happens rather a lot.

    If our only concern is human survival, then our only strict need is plentiful energy since with that we can produce whatever else we need. It would be nice, however, to exist in a world which does have fresh air, clean lakes, forests, reefs, deserts and glaciers, together with an abundant variety of animal and plant life – simply because it is more interesting. I think it is sensible to have some regard for the environment, simply for this reason, but it is not necessary to pretend we can somehow prevent or even appreciably slow down planetary processes we hardly understand. Equally, complacency and thoughtless destruction would make the world a less pleasant place, even if we can survive in it.

    It is better to look after one’s house and pass it on reasonably intact to one’s children, even if we do this in the knowledge and acceptance of the fact that it will inevitably change, than it is to trash it because we are alive now but we’re dead a long time. Medias in res, as always.

    EG

  • Daveon

    Euan’s right on this. The problem are things like water and natural biomass. We can probably survive as a species without natural supplies of either, but it wouldn’t necessarily be pleasant and I’m not sure what it would do for our quality of life.

    Jared Diamond’s _Why Societies Chose to Fail_ is a pretty even handed analysis of this problem and what some societies have done about it historically.

  • effjay

    If this is true and 2/3 of the resources are “used” up, than no better time than now to get us into space, colonize the moon and or Mars, and get to moving the human race off the planet. I don’t know what the limit to this planet is but I would be inclined to say 10 billion humans might be it. It’s not too far off i’m afraid.

  • Euan Gray

    If this is true and 2/3 of the resources are “used” up

    For one thing, this is not the assertion.

    For another, this planet has no net exports (unless the Area 51 stuff is true and we are exporting alcoholic rednecks and bovine intestines on an industrial scale). Resources aren’t used up, they just change form. We will never run out of any non-living resource unless we permanently export it from the planet – it just won’t be in easily exploitable forms any more. All this means is the price goes up and/or we find cheaper alternatives.

    As for population, prosperity is the answer. People have fewer children when life is easy, so if the world gets more prosperous, and if this prosperity is spread widely enough, the population will level off and then decrease.

    EG

  • The title of the thread is misleading,

    Then so is Graunaid headline, because it claims that 2/3 of the wordl’s resources are used up.

  • Julian Morrison

    Another counter-argument:

    Q: Where are most of the useful “resources” in the universe?

    A: In space, or accessible via space, but you can’t get there if your tech doesn’t reach beyond mud huts. (Voluntarily or otherwise.)

    IOW the “resource-consuming” rush to space is the only long term sustainable course. And that itself is predicated on a “resource-wasteful” consumer-industrial-capitalist society.

    Even if you’re green, right now only anti-green is green ;-P

  • veryretired

    Wow—another recitation of the Litany. Yawn.

  • Jake

    I used to worry about running out of copper. Then fiber optics was discovered for communication lines. Now the world has a large surplus of copper.

    The same will happen for every resource shortage unless governments interfere with the substitutions. And many will as they try to protect local industries.

  • I'm suffering for my art

    veryretired refers to the Litany. And well may he! Just the book I was thinking of – and one I imagine many bloggers and contributors are familiar with – Bjorn Lomborg’s The Skeptical Environmentalist. A marvellous demolition of the Green campaign with considerably higher standards than most of the Green publications. Meaning that it has references, and highly credible ones at that.

    For those that haven’t read it (and if not, why not? Go and buy it now!) the book has an especially interesting chapter on resources which concludes that “the prices of nearly all resources have been declining over the last century, and despite an astounding increase in production of a large number of important raw materials they today have more years of consumption left than they did previously.” What? You mean that even though we’re using more resources than ever, we’re constantly finding more than we use, hence reserves are growing?? Greenies can write this off as so much hogwash but the proof is in some very basic economics – scarcity determines price, and prices are falling.

    The chapter checks the reserves of all the major raw resources and determines that “reserves of only three minerals have dropped, and this drop is serious for only one element, namely tantalum. The total cost of tantalum is below one-millionth of global GDP, and the element can be substituted.” Well, there’s something for Greenies to kill themselves with anxiety over. Excuse me if I’m not similarly panic-ridden.

  • gravidx

    I do disagree with the idea that we should enjoy it all now because we area a long time dead. What y’all gonna do when oil gets to £5 a litre? or when it goes past that? What happens when oil becomes too expensive to get out of the ground?
    What fabulous new technology is up the sleeves of whomever?

  • Euan Gray

    What y’all gonna do when oil gets to £5 a litre?

    Use something cheaper.

    What happens when oil becomes too expensive to get out of the ground?

    It can’t get “too expensive” to extract. It can get so expensive that alternatives become more attractive.

    What fabulous new technology is up the sleeves of whomever?

    Fuel cells. Hydrogen. Batteries. Nuclear power. Biodiesel. It’s not like there are no options.

    EG

  • I'm suffering for my art

    Gravidx – Assuming that the price of oil won’t fall (and most sensible commentators believe it will in the medium term) simple economics will answer your question. We already have a number of alternatives to oil – they’re just not cost effective against oil *YET* but the gap is narrowing as money is spent developing the technology. As oil becomes more expensive, research and development into alternatives increases further as companies invest to ensure greater future profitability, and the gap narrows faster. The costlier the oil, the greater the short to medium term pain. But the sooner we can throw off oil’s yoke.

    I long for the day when OPEC folds due to irrelevence and all those tinpot oil dictatorships collapse because its lazy citizens have pissed their oil wealth up against the wall – the harsh truth dawns – no one wants to buy the filthy black muck they’re pumping out of the ground. This day will come during my lifetime.

  • I'm suffering for my art

    Dammit, Euan, you beat me!

  • The actual report is pretty good. Almost all of the problems they talk about (and it is ecosystems, not resources) are sub sets of The Tragedy of the Commons. And we know how to deal with that, restrict access to the commons via property rights. Which the report suggests as the solution. Seriously, cap and trade, economic incentives, private ownership, fishermen owning the fish stocks and the right to exploit them….forget what the Grauniad said about the report and go and read it from page 154 onwards.
    This is the first thing I have seen form an offical source which pushes free market environmentalism. It’s great.

    To recap, there are problems with open access resources. The solution is to stop them being open access. That’s what the report says, and we righties should welcome it.

  • lth

    I thought Lomborg’s book was terrible. He was as guilty of statistics-bending as anyone in the debate. I didn’t finish it because I was so angry with what I thought was going to be a sensible book that turned out to be heavily, heavily biased.

  • Johnathan

    lth, “heavily, heavily biased”. Really? Lomborg’s sin, in the eyes of the deep Greenies, was to use the data they use and draw dramatically different conclusions from them. He committed the ultimate sin of heresy.
    From what I have read about Lomborg, he is a highly consciencious fellow who is also, I would point out, very much an environmentalist. But because he does not pander to the doomonger agenda, he is damned.

  • gravidx

    EG, ISFMA. Thankyou for your comments.
    I do think that oil will be clung to for as long as possible to wring every last penny that can be wrung.
    Euan I asked what NEW technology, all those options are already here.
    Nikola Tesla anyone?

  • Duncan

    “Hydrogen. Batteries. Nuclear power. Biodiesel”

    “they’re just not cost effective against oil *YET*”

    This is a gross understatement. Our civilization is where it is, technoligically speaking, because we’ve had an abundance of very cheap, very efficient fuels.

    Batteries, as far as I know aren’t really an “energy source” in the way oil is… i.e. they’re not an natural resource and we need to first *get* the energy to put into them.

    Biomass sources currently costs WAY more energy to create than they provide. What do you use to fuel all that machinery that’s used to grow that stuff? How do you get it around? Alot of oil goes into growing stuff on a large scale.

    Oil isn’t just about driving cars… effiecient, cheap fuel…and oil IS cheap and effiecient, is the basis for everything from growing food, making plastic, fertilizer, drugs… pretty much everything we consider nifty.

    The alternatives are a long, LONG way from being able to replace it. Nuclear is probably the best bet, but it has its own set of issues… and everyone hates it… well except Iran.

  • Euan Gray

    Euan I asked what NEW technology, all those options are already here.

    Basically they would appear to be enough:

    Nuclear power for central electricity generation to replace oil and gas. Use breeder reactors here and there & basically you never (realistically) run out of fuel;

    Desalination/electrolysis of seawater in nuclear plants to produce fresh water and hydrogen;

    Growing oleaginous crops to make biodiesel & biomass fuels;

    Increased use of fuel cells in cars, hydrogen or biodiesel powered combustion engines, electric transmission (more efficient than mechanical), battery-electric or hybrid cars for short journeys, increased use of public transport in high population density areas, or a combination of the these.

    All this gives you non-fossil alternatives for the types of power currently in use without using anything other than perfectly proven technology. There is simply no need for speculative stuff like various Tesla ideas, many of which are junk anyway. If some new technologies become more economically attractive than these established ones, doubtless they will be used, but it is a mistake to assume we need EITHER oil OR exotic and unproven new technology. This is a false dichotomy.

    EG

  • gravidx

    Teslas notes were taken away by the US govt when he died. He did discover AC so not all his ideas were useless. I agree with Duncan our entire modern world is based on oil. I think that some of the more, so far ,esoteric ideas that have been “floating” around for some time need to be looked at more closely as the oil business loses its grip on the world. A change in our , shock horror , lifestyle may have to be confronted. Sooner rather than later.

  • Euan Gray

    Our civilization is where it is, technoligically speaking, because we’ve had an abundance of very cheap, very efficient fuels

    And if, or rather when, this changes, so our civilisation’s technology changes. Big deal. It happened before going from wood to coal, then from coal to oil, and will happen again going from oil to whatever.

    What do you use to fuel all that machinery that’s used to grow that stuff?

    Hydrogen in combustion engines? In fuel cells? Electricity? Plenty of options for that.

    Alot of oil goes into growing stuff on a large scale.

    Yes, it does, and conventional agriculture is hideously inefficient. Increased use of hydroponic agriculture, food synthesis, and so on can vastly reduce the amount of oil needed for this. In the context of reducing availability of oil, this will be necessary anyway.

    oil IS cheap and effiecient, is the basis for everything from growing food, making plastic, fertilizer, drugs… pretty much everything we consider nifty.

    Indeed, but oil is not the only source of the raw materials (basically hydrocarbons). Right now it is the cheapest and easiest source, but this will not always be the case. When it isn’t, an alternative will be used, or we will by then be using different raw material chemistries.

    Nuclear is probably the best bet, but it has its own set of issues

    It is the ONLY viable short to medium term alternative which does not entail greatly reducing per capita energy consumption.

    EG

  • Daveon

    The World should move over asap to a Nuclear/Hydrogen economy. My only real concern is with the lead times, that Oil costs will cause economic chaos before we can build enough Fast Breeders and Hydrogen infrastructure.

    It’s the natural world, assuming people want one, that’s more of a concern, because that’s much harder to substitute.

    I’ve no real concern about metals/energy etc… as we already know that we can find alternatives. If you lose species/clean water/natural environments etc… it’s not clear to me you can replace them.

  • Duncan Sutherland

    With near future oil prices of $100/barrel already being whispered in the news, I think the alternatives that many think will save us are going to be a little late to the party. I’m sure we’ll work it out, as we always have… however I’m a little pessimsitic about what state many of us industrialized nations will be in before it is.

  • Duncan Sutherland

    Big deal. It happened before going from wood to coal, then from coal to oil, and will happen again going from oil to whatever.

    Yes except we didn’t move on because we had a wood or coal shortage… we moved on because we found better alternatives…

  • gravidx

    Well said Duncan I couldn’t agree more.

  • gravidx

    Well said Duncan, I couldn’t agree more.

  • Euan Gray

    Yes except we didn’t move on because we had a wood or coal shortage… we moved on because we found better alternatives

    We already have better alternatives for oil for energy production – they just aren’t economically attractive because oil is so cheap. Once oil becomes more expensive (and recall it is at this time markedly cheaper than it was in the late 70s/early 80s), these alternatives will become commercially attractive, and will be used. The only difficulty is the time needed to, for example, build nuclear power stations – but oil is not going to suddenly run out overnight, the process will take decades.

    EG

  • Duncan Sutherland

    but oil is not going to suddenly run out overnight, the process will take decades.

    No one, at least me, is under the assumption that we will suddenly run out… the problem is only so much can be pumped out, per day. When the demand outstrips this number, and with China and India we are pretty close to bouncing off this ceiling, the price goes up… way up. And it’s not a matter of it being to expensive to drive my car so I’ll take the bus. It becomes very expensive to transport things like say… FOOD. Plastic becomes more expensive, everything petrolium based becomes expensive… a great deal, if not all, of our infrastructure is dependant on cheap fuel.

    I’m not really in disagreement with your view Euan.. I’m just not quite as optimistic that we’re going to pull our asses out of the fire before some real damage and real pain is felt throughout the world. See what happens if in fact oil hits $100 / barrel.

  • Euan Gray

    Oil reached $100/barrel (in today’s terms) at the time of the Iranian revolution. The sky failed to fall in.

    EG

  • Duncan Sutherland

    “Oil reached $100/barrel (in today’s terms) at the time of the Iranian revolution. The sky failed to fall in.

    It almost hit $40 then… this may or may not be equivalant to $100 in todays terms I’m not sure.

    Regardless, that was an articficial price inflation caused by OPEC. That isn’t the case now. It’s going to occur because world consumption is going to out pace production. If production can’t be upped significantly, and it most likely can’t, this situation will persist rather than be “corrected” because OPEC decides to play nice again.

    Though the sky didn’t fall… in the U.S it certainly had an impact as anyone who remembers the time knows. Today we are more, probably much more, dependent on our petrolium products… as are all the large industrialized nations with the additions of India and China who were not part of the equation back in the 70′s and 80′s.

  • I'm suffering for my art

    With near future oil prices of $100/barrel already being whispered in the news

    I’ve heard a bunch of bollocksy things “whispered” in the news. It sells papers and advertising slots, but it’s frequently rubbish.

    Euan is right. If oil becomes incredibly expensive, we will definitely feel pain. However, there are enormous oil reserves out there that aren’t under the sands of the Arabian desert. Very high prices will merely accelerate alternative exploration and production. As a result, oil prices will fall again.

    Your concerns, Duncan and Gravidx, would make greenies the world over proud. Their scaremongering hasn’t come to naught. You need to understand that there is a CRAPLOAD of oil out there. Oil companies regularly state that they have discovered reserves that’ll cover about 35-40 years, adjusted to take estimated future usage increases into account. I have a friend who works at Shell; she says it’s common knowledge in the industry that the figure is more like 90. Makes sense – increase the perception of scarcity, increase the price.

    New technology makes it easier and cheaper to retrieve the oil. New technology makes oil retrievable from old abandoned wells which, in the past, needed to be abandoned when they were about half depleted due to technological constraints.

    See what happens if in fact oil hits $100 / barrel.

    It won’t. Or, to be cautious, it’s extremely unlikely that it will.

    TRUST ME, we aren’t going to run out of oil before it becomes obselete. Nor is it going to become wildly expensive in the medium to long term. It’s doubtful it’ll become wildly expensive in the short term! So don’t panic. Like the Saudi oil minister said, “The Stone age didn’t end due to lack of stone; and the oil age won’t end due to lack of oil.”

  • Euan Gray

    See what happens if in fact oil hits $100 / barrel

    The effect is not as big as you might think. Back of an envelope figures coming up: petrol (gasoline) costs around 50-60 cents per US gallon to make – the rest is tax. If oil doubled in price overnight, pump prices would go up some 30-40% in the US. Here in Britain, since nearly 90% of the price is tax, the pump price would increase by about 10%. This not so bad for us, since we have cars with small, efficient engines, but the American driver of a 7 litre pickup is going to really feel the pain. This fuel price hike naturally affects food prices (indeed, the price of anything which needs to be transported), plastics, fertilisers, etc. – but not as much as you might think.

    It almost hit $40 then… this may or may not be equivalant to $100 in todays terms I’m not sure.

    I am and it is.

    It’s going to occur because world consumption is going to out pace production

    Rubbish.

    I work for an engineering company in the oil industry, so I do have some idea what I’m talking about.

    Known oil reserves are huge – at a MINIMUM 50 to 60 years. I couldn’t vouch for the 90 years quoted by Suffering’s friend, but it seems perfectly realistic. That’s what is there. Not all of those reserves are economically viable at current prices, but as the price increases so more and more reserves become economic and the available supply rises to meet the demand. Prices then stabilise. This cycle repeats, and has done for decades – I note that we have been apparently 10 years from exhaustion on a more or less continual basis since about 1914. This appears to be a rather long decade.

    If production can’t be upped significantly, and it most likely can’t

    Of course it can. As the price goes up, oil companies invest in developing these previously uneconomic fields, and when they come on stream so production increases. It takes a couple of years to do this, of course, and this is why the peak-trough cycle in the oil industry lags that in the rest of the economy by about 18 to 24 months.

    Naturally, the oil supply in total is finite and we will one day run out. It is HIGHLY unlikely that we will run out before we have alternatives in place – in fact, we already have the technology we need to replace oil for power generation and transport needs, and for some other things. Some materials, like plastics and certain other oil derivatives, are rather more dependent on crude oil, but even so the available supply is good for decades to come, within which time it is highly likely we will have alternatives.

    I agree completely with Suffering (although I wish he’d use a handier name) – we will stop using oil on a large scale many years before the supply runs out. There is absolutely nothing to worry about in terms of global oil supply.

    EG

  • Duncan Sutherland

    Well I hope your both right… and despite what you may think from my posts I’m no “greenie” by a long shot.

    I just think your assumptions that we will easily move on from oil is perphaps wishful thinking.

    As the price goes up, oil companies invest in developing these previously uneconomic fields

    And what is it that makes these fields uneconomic? And doesn’t it follow that it will be more expensive to get oil out of them? I’m not saying there is not more oil to be had… we will probably NEVER actually run out.. however after the “easy” stuff is pumped, whats left is harder and more expensive to get at.

    Like I said. I’d be happy to be on the wrong side of this issue.

  • Euan Gray

    after the “easy” stuff is pumped, whats left is harder and more expensive to get at

    Well, yes. So the price goes up. So alternatives become more economically attractive. It’s not hard to follow, really.

    EG

  • Duncan Sutherland

    I guess the question is how much the prices go up… and how much a price on something so integral to our lives can go up before the results start to be nasty.

    But you say your in “the business” so to speak, and I am not, so I’ll defer to you.

  • Euan Gray

    Duncan,

    It doesn’t really matter how much the price of oil goes up, per se. Nor does it matter about which one of is or is not in the business. It’s simple economics & the concept of supply, demand & alternative applies to any commodity.

    If oil becomes expensive, then IN COMPARISON alternatives become cheap, and if the difference is enough to outweigh the cost of conversion, we will use the alternative.

    If oil were to suddenly and permanently become very much more expensive, of course it would hurt. Transport would become more expensive – so we car pool, buy cars with smaller engines, use alternatives such as public transport & bicycles, and so on and as appropriate. People do this automatically. Food becomes more expensive, so people automatically cut back on expensive luxury and junk food. Plastics become more expensive, so we consume less by taking more care of what we have and using alternatives.

    It would hurt – some people more than others – but the pain would not last forever. Alternatives are there and since they would now be more economically attractive they would be used, thus easing the hurt. It would only get “nasty” if there were absolutely no alternatives to oil – and there are alternatives, for everything we use oil for.

    Even if we cannot convert some things, or the conversion takes a long time, we can still use alternatives like coal (of which there are gigantic reserves). Oil can be made from coal (Sasol in apartheid-era South Africa developed this from oil-from-coal processes used in Germany in WW2). Oil fired boilers in power stations can be converted to burn powdered coal or coal/water slurry. Gas turbines can burn coal dust. Large diesel engines can burn coal/water slurry. We can also use vegetable oil – the diesel engine was initially developed to do exactly this – and can greatly expand oil crop production.

    Many of these things are more expensive than $50 oil, but can be less expensive than $100 oil, especially if oil is going to be at $100+ indefinitely and the investment is justified.

    And that doesn’t even touch longer term programs such as expanding nuclear generation, using hybrid cars, developing battery technology, electrifying railway lines, using economical diesel engines in aircraft (seriously, you’d be surprised), expanding the use of GM crops to reduce fertiliser needs, hydroponic agriculture, food synthesis, and so on.

    Oil supply simply is not an issue.

    EG

  • John B.

    This is a little late in coming, but what the heck.

    EG and suffering are completely right–oil will become uncompetitive before we are even close to running out.

    There are MASSIVE amounts of untapped oil reserves. For example, the tar sands in Canada. It is estimated that there are at least 1.5 TRILLION barrels of oil in the Athabaska Tar Sands. This oil is already being collected, and as better technology is developed, more and more will come from here.

    According to the Alberta Energy and Utilities Board, the Athabasca tar sands is the largest oil deposit in the world, with an estimated 1.6 trillion barrels (254 km³) of oil, of which at most 315 billion barrels are considered recoverable by the oil companies given current technology.

    (Look here)

  • I'm suffering for my art

    Is that what they call shale oil (found in rock)? The Skeptical Environmentalist states we have several hundred years’ consumption if we utilise that.

    and despite what you may think from my posts I’m no “greenie” by a long shot.

    I didn’t say you were, but you’re peddling the line they come out. I do admit the “WE’RE GOING TO RUN OUT OF OIL!!!!” syndrome predates the green movement by some years. They are, however, the principle sponsors of it these days.

    I just think your assumptions that we will easily move on from oil is perphaps wishful thinking.

    If you look at it through a timespan of a couple of years, sure. You need to consider we’re talking about two or three, maybe more, decades here. That’s a *long* time to develop the alternative technologies we currently hold but aren’t economic. It would probably take a couple of decades to build the infrastructure to make fuel cell-powered vehicles convenient, for example.

  • A small nit pick.

    Euan asserted that oil cannot get too expensive to extract.

    ISTM that it can, at least in principle. It could take more energy to get it out than would be derived from using it, in which case extracting it for use as an energy source would be counter productive.

  • Euan Gray

    ISTM that it can, at least in principle. It could take more energy to get it out than would be derived from using it, in which case extracting it for use as an energy source would be counter productive

    Yes, but not too expensive in a financial sense. In terms of the energy equation you can be correct in certain circumstances – but then we don’t only use oil to generate energy.

    EG

  • gravidx

    It has been interesting to hear the non green viewpoint on the oil is running out question.

    Call me a greenie if you will , I even believe in regulation of industry !

    I have been following the notion that oil is running out since the postings of troops from the usa to a lot of the former soviet states who just happen to have oil reserves.

    It is heartening to hear that there is plenty of oil for us all for the rest of my lifetime at least.