COMMONWEALTH OF AUSTRALIA

Copyright Regulations 1969

WARNING

This material has been reproduced and communicated to you by or on behalf of

International College of Management, Sydney pursuant to Part VB of the Copyright
Act 1968 (the Act).

The material in this communication may be subject to copyright under the Act. Any
further reproduction or communication of this material by you may be the subject of
copyright protection under the Act.

Do not remove this notice.

COMMONWEALTH OF AUSTRALIA
Copyright Regulations 1969
WARNING
This material has been reproduced and communicated to you by or on behalf of International College of Management, Sydney pursuant to
Part VB of the Copyright Act 1968 (the Act).
The material in this communication may be subject to copyright under the Act. Any further reproduction or communication of this
material by you may be the subject of copyright protection under the Act.
Do not remove this notice.
Conservation in Context
Three Anathemas on Limiting Economic Growth
We have many problems, but appar-
ently only one solution: economic
growth, or as the pundits now like
to say, “to grow the economy” (as if
it were a potted plant). But let us stop
right there and ask two questions
that all students of economics should
put to their professors. First, do you
think of growth as a temporary pro-
cess necessary to bring wealth to a
level or state of sufficiency, which
will then be maintained more or less
in a steady state, or as a continu-
ous process of getting bigger that is
desirable in itself? At least 99% of
modern neoclassical economists be-
lieve the latter. We have to go back
to J. S. Mill and the earlier classi-
cal economists to find serious treat-
ment of the idea of a nongrowing
economy, the stationary state. The
second question is, what makes you
think further growth—physical ex-
pansion of the economic subsystem
into the containing ecosystem—has
not begun to increase environmental
and social costs faster than produc-
tion benefits and thereby become un-
economic growth, making us poorer,
not richer? After all, GDP—the mea-
sure of “economic” growth—does
not separate costs from benefits but
conflates them as “economic” activ-
ity. Our national accounts are in-
capable of registering uneconomic
growth, implicitly counting costs as
benefits. How do we know when
the growth elixir has exceeded its
shelf life and become toxic? Be
prepared, students, for some hand-
waving replies.
Continuous growth would only
make sense if the economy were not
a subsystem of a larger finite ecosys-
252
Conservation Biology, Volume 23, No. 2, 252–253

C 2009 Society for Conservation Biology
DOI: 10.1111/j.1523-1739.2009.01188.x
tem, the economy were growing in a
nonphysical dimension, or the laws
of thermodynamics were negated.
Let us consider each logical possibil-
ity for extending the shelf life of our
traditional growth panacea.
1. Some economists actually do
seem to think of nature as a
set of subsectors of the econ-
omy (grasslands, forests, fisheries,
mines, wells) and see the econ-
omy, not the ecosystem or bio-
sphere, as the whole. If the econ-
omy is the whole, then it is not a
part of any larger thing or system
that might restrain its expansion.
If some natural sector gets scarce,
we will just substitute other sec-
tors for it and growth will con-
tinue, not into any restraining bio-
sphere, but into the infinite void.
2. Some economists say that what is
growing in economic growth is
value, and value is not reducible
to physics. The latter is true, of
course, but does not mean that
value is independent of physics.
After all, value is price ($) times
quantity (q), and quantity is al-
ways basically physical. Even ser-
vices are always of something or
somebody for some time period,
and people who render services
have to eat. The value unit is not
dollars, but dollar’s worth. A dol-
lar’s worth of gasoline is a phys-
ical amount, currently about half
a gallon. The aggregation (gross
domestic product) of the dollar’s-
worth amounts of many different
physical goods measured in differ-
ent physical units does not abol-
ish the physicality of the measure
even though the aggregate can no
longer be expressed in physical
units. True, $/q × q = $. But the
fact that q cancels out mathemati-
cally does not mean that the aggre-
gate measure, “dollars’ worth,” is
just a pile of dollars. And, it does
not help to speak instead of “value
added” (by labor and capital) be-
cause one must ask, to what is
the value added? And, the answer
is natural resources, low-entropy
matter or energy.
3. If resources could be created
out of nothing and wastes could
be annihilated into nothing, then
we could have an ever-growing
throughput with which to fuel the
continuous growth of the econ-
omy. But the first law of thermo-
dynamics says we cannot do this.
Or, if we could just recycle the
same matter and energy through
the economy faster and faster we
could keep growth going. The
circular-flow diagram of all eco-
nomics principles texts comes
very close to this. But the second
law of thermodynamics says it is
not possible.
So, if we cannot grow our way
out of all problems, then maybe
we should reconsider the logic and
virtues of nongrowth, the steady-
state economy. Why is the very term
repugnant to economists? They even
redefined the term to refer to a spe-
cial case of growth. When capital and
labor grow at the same rate, so that
their ratio remains constant, we have
what the neoclassicals, with con-
summate etymological ineptitude,
call “steady-state growth” instead of
Daly
proportional growth. Thus even the
vocabulary of nongrowth has been
pre-empted. The only word allowed
for the description of nongrowth is
stagnation. Why this refusal to face
common sense?
I think the answer is distressingly
simple. Without growth the only way
to cure poverty is by sharing. But
redistribution is anathema. Without
growth to push the hoped for demo-
graphic transition, the only way to
cure overpopulation is by population
control—a second anathema. With-
out growth the only way to invest
in environmental repair is by reduc-
ing current consumption—anathema
number three. Three anathemas and
you are damned.
And without growth how will we
build up arsenals to protect democ-
racy? How will we go to Mars and
Saturn and “conquer” space? How
will we cure cancer? Where will tech-
nical progress in consumer goods
come from if we do not have spin-offs
from the military and from space re-
search? Pie-in-the-sky technological
savior fantasies of populating outer
space and of abolishing disease and
253
even death itself, feed on the perpet-
ual growth myth of no limits. Digital-
brained tekkies, who have never
heard of the problem of evil, see
heaven on Earth (eternal growth) just
around the corner. Without growth
we must face the difficult religious
task of finding a different god to wor-
ship. Too scary, we say, let us try to
grow some more instead!
Herman Daly
School of Public Policy, University of Mary-
land, College Park, MD 20742-1821, U.S.A.,
email hdaly@umd.edu
Conservation Biology
Volume 23, No. 2, 2009
 PR OJEC T S Y NDIC AT E COMMENTA R IE S ON ECONOMIC S A ND T ECHNOLOGY.

JUNE 26 2013 6:30 AM

The Limits of Panic

Obsessing over doom-and-gloom scenarios
distracts us from real global threats. 1.1k

By Bjørn Lomborg

An oil and gas pumping station in Santa Cruz, east from Havana, Cuba.
Photo by Adalberto Roque/AFP/Getty Images

We often hear how the world as we know it will end, usually through ecological
collapse. Indeed, more than 40 years after the Club of Rome released the mother of all
W eb page converted to PDF w ith the PDFmyURL PDF creation API!
 apocalyptic forecasts, The Limits to Growth , its basic ideas are still with us. But
time has not been kind.

The Limits to Growth warned humanity in 1972 that devastating collapse was just around
the corner. But, while we have seen financial panics since then, there have been no real
shortages or productive breakdowns. Instead, the resources generated by human
ingenuity remain far ahead of human consumption.

But the report’s fundamental legacy remains: We have inherited a tendency to obsess
over misguided remedies for largely trivial problems, while often ignoring big problems
and sensible remedies.

In the early 1970s, the flush of technological optimism was over, the Vietnam War was a
disaster, societies were in turmoil, and economies were stagnating. Rachel Carson’s
1962 book Silent Spring had raised fears about pollution and launched the modern
environmental movement; Paul Ehrlich’s 1968 title The Population Bomb said it
all. The first Earth Day, in 1970, was deeply pessimistic.

The genius of The Limits to Growth was to fuse these worries with fears of running out of
stuff. We were doomed, because too many people would consume too much. Even if our
ingenuity bought us some time, we would end up killing the planet and ourselves with
pollution. The only hope was to stop economic growth itself, cut consumption, recycle,
and force people to have fewer children, stabilizing society at a significantly poorer
level.

That message still resonates today, though it was spectacularly wrong. For example, the
authors of The Limits to Growth predicted that before 2013, the world would have run
out of aluminum, copper, gold, lead, mercury, molybdenum, natural gas, oil, silver, tin,

W eb page converted to PDF w ith the PDFmyURL PDF creation API!

 tungsten, and zinc.

Instead, despite recent increases, commodity prices have generally fallen to about a
third of their level 150 years ago. Technological innovations have replaced mercury in
batteries, dental fillings, and thermometers: Mercury consumption is down 98 percent
and, by 2000, the price was down 90 percent. More broadly, since 1946, supplies of
copper, aluminum, iron, and zinc have outstripped consumption, owing to the discovery
of additional reserves and new technologies to extract them economically.

Similarly, oil and natural gas were to run out in 1990 and 1992, respectively; today,
reserves of both are larger than they were in 1970, although we consume dramatically
more. Within the past six years, shale gas alone has doubled potential gas resources in
the United States and halved the price.

As for economic collapse, the Intergovernmental Panel on Climate Change estimates

that global GDP per capita will increase 14-fold over this century and 24-fold in the
developing world.

The Limits of Growth got it so wrong because its authors overlooked the greatest
resource of all: our own resourcefulness. Population growth has been slowing since the
late 1960s. Food supply has not collapsed (1.5 billion hectares of arable land are being
used, but another 2.7 billion hectares are in reserve). Malnourishment has dropped by
more than half, from 35 percent of the world’s population to under 16 percent.

Nor are we choking on pollution. Whereas the Club of Rome imagined an idyllic past with
no particulate air pollution and happy farmers, and a future strangled by belching
smokestacks, reality is entirely the reverse.

In 1900, when the global human population was 1.5 billion, almost 3 million people –
roughly one in 500—died each year from air pollution, mostly from wretched indoor air.
W eb page converted to PDF w ith the PDFmyURL PDF creation API!
 Today, the risk has receded to one death per 2,000 people. While pollution still kills more
people than malaria does, the mortality rate is falling, not rising.

Nonetheless, the mindset nurtured by The Limits to Growth continues to shape popular
and elite thinking.

Consider recycling, which is often just a feel-good gesture with little environmental
benefit and significant cost. Paper, for example, typically comes from sustainable
forests, not rainforests. The processing and government subsidies associated with
recycling yield lower-quality paper to save a resource that is not threatened.

Likewise, fears of overpopulation framed self-destructive policies, such as China’s one-

child policy and forced sterilization in India. And, while pesticides and other pollutants
were seen to kill off perhaps half of humanity, well-regulated pesticides cause about 20
deaths each year in the U.S., whereas they have significant upsides in creating cheaper
and more plentiful food.

Indeed, reliance solely on organic farming—a movement inspired by the pesticide fear—
would cost more than $100 billion annually in the U.S. At 16 percent lower efficiency,
current output would require another 65 million acres of farmland—an area more than
half the size of California. Higher prices would reduce consumption of fruits and
vegetables, causing myriad adverse health effects (including tens of thousands of
additional cancer deaths per year).

Obsession with doom-and-gloom scenarios distracts us from the real global threats.
Poverty is one of the greatest killers of all, while easily curable diseases still claim 15
million lives every year–25 percent of all deaths.

The solution is economic growth. When lifted out of poverty, most people can afford to
avoid infectious diseases. China has pulled more than 680 million people out of poverty
W eb page converted to PDF w ith the PDFmyURL PDF creation API!
 in the last three decades, leading a worldwide poverty decline of almost 1 billion people.
This has created massive improvements in health, longevity, and quality of life.

The four decades since The Limits of Growth have shown that we need more of it, not
less. An expansion of trade, with estimated benefits exceeding $100 trillion annually
toward the end of the century, would do thousands of times more good than timid feel-
good policies that result from fear-mongering. But that requires abandoning an anti-
growth mentality and using our enormous potential to create a brighter future.

Bjørn Lomborg is an adjunct professor at the Copenhagen Business

School and directs the Copenhagen Consensus Center. He is the author
of The Skeptical Environmentalist, Cool It, and most recently How Much 1.1k

Have Global Problems Cost the World?

FOLLOW SL ATE SL ATE ON IPHONE ANDROID KINDLE REPRINTS ADVERTISE WITH US

ABOUT US CONTACT US WORK WITH US USER AGREEMENT PRIVACY POLICY FAQ FEEDBACK CORRECTIONS

Slate is published by The Slate Group, a Graham Holdings Company. All contents © 2017 The Slate Group LLC. All rights reserved.

Suppor t Michelle Goldberg’s coverage of the Trump adminis tration. Join Slate Plus today.

W eb page converted to PDF w ith the PDFmyURL PDF creation API!