February 20, 2014

The Parable of the Magic Vending Machine (or where I disagree with Julian Simon)

Rather than attempt to summarize the late economist Julian Simon’s controversial ideas for the uninitiated I will refer those readers to the “Theory” section of the Wikipedia article below. An advocate of Simon assures me the article is a fair summary.

http://en.wikipedia.org/wiki/Julian_Simon

The clearest way to illustrate my fundamental disagreement with Simon is with an analogy. Of course, no analogy is perfect, and this one does not map perfectly to the way any particular resource behaves – but I think it underscores the disparity in our views quite well.

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Imagine an apartment building in the middle of a boundless desert. It is occupied by Julian Simon, myself, and eight other demographically representative people. There are five males, five females, three children, and a couple of seniors. None of us know how we got there. We do know, somehow, that the desert cannot be crossed. For all intents and purposes, the apartment building and its immediate environs constitute our universe.

The apartment building has a common basement area. The basement contains not only the usual washer, dryer and miscellaneous flotsam from previous tenants, but an enormous steel box in the form of a cube, two meters on each side. The box is freestanding on short metal legs so that is possible to see the empty space beneath it. The only thing that goes into the box, as far as anyone can tell, is electricity from an electric power cord which is plugged into the wall. Other than that, the box appears wholly self-contained. On the front of the box there are three large bar-shaped levers and a closed sliding door a half meter square. If the apartment building is a rather Spartan universe, it is at least a universe that B.F. Skinner could love.

As it turns out, there are working water taps in the apartment building but nothing at all to eat. Having nothing better to do, one of the more enterprising tenants (we will arbitrarily call her “Kay”) presses the leftmost bar forlornly and on the thousandth press the door slides open to reveal a few plain baked potatoes. Everyone eats. When we all get hungry again, we bar-press expectantly. Again, a few potatoes appear after a thousand presses. We become curious about opening up the giant box to save the trouble and indignity of bar-pressing like laboratory rats. It turns out that the box is impenetrable, at least by any of the simple tools at our disposal. Hammering reveals it to be as strong as a bank safe.

After a few days, the box ceases to deliver up potatoes. Julian tries alternating the pressing of two of the bars, and after only 900 total presses the box serves up some carrots and a large roast. We all eat our slightly better meal with gusto. Again, this pattern continues for several days before box stops responding to our inputs.

Julian and Kay take over the businesses of trying and recording new combinations of bar-presses. Over time, some general trends emerge. First, the patterns required to make the box deliver food become more and more complex, but require fewer total bar presses. Julian and Kay develop a kind of index of commands that will summon up specific foods. Over time, the food gets tastier, more varied, and more nutritionally complete. The box continues to stop producing specific items occasionally, but since there is now an index of items available we all worry less when this occurs. By common consent, the rest of the tenants take over whatever minor domestic duties Julian and Kay might have, freeing them to concentrate on the critical task of staying ahead of our food requirements.

Two years pass without much to mark their passage. An old woman dies. Two children are born. A third is on the way. Always the pessimist, I have grown more and more uneasy about our food supply. I express this concern to Julian. This is what he says:

“I’ve tracked the output of the box since the day two years ago when it produced its first potatoes. Over that time, month by month, it has produced more and better food with less and less actual physical effort. It has sometimes failed to produce something we wanted, but our imagination has never failed to coax from it something new to our liking. As items have dropped from our diet, Kay and I have always been motivated to find new items to maintain our status as food-providers, as well as to feed ourselves and the other tenants. Why should you think there is cause for concern?”

“It requires,” I say “about half a liter of food per day to sustain each of us at a meager level. At our original number of ten, we required about five liters of food per day as a group. The total volume of the box is about 8000 liters. Assuming its internal machinery is negligible in volume and that it began completely packed with food, it should have had a capacity to feed us for 1600 days. We have now consumed the contents of the box for 730 days. There are now eleven of us, and most of us are feasting on well more than half a liter of food per day precisely because you have been so successful in providing it.”

“You cannot accurately predict the day on which we might run out of food,” Julian objects. “You do not really know how many people the box can sustain. You do not know how densely its contents are packed, nor do you know anything about its internal workings. What you do know is that our ingenuity has coaxed from the box a better and better quality of life, and you have only theory to persuade me that the continued improvement of our situation is in jeopardy.”

“I know almost nothing about the internal conditions of the box,” I admit. “However, I know enough about the physics of the rest of our world to reasonably assume that its internal volume isn’t greater than its external volume. If food is packed more densely inside the box than I’ve imagined, it is nevertheless still finite if it obeys the ordinary laws of physics. To escape the scenario in which the box must run out of food in something less than a decade you have to believe that, somehow, your ingenuity not only extracts the food but somehow brings it into being. You have to believe, in essence, that the laws of nature are arranged for our success and that our record of success up to this point proves that conclusively. While I cannot prove you are wrong, it appears at least as likely that we have just been draining the box of contents it began with. Our facility in doing so has indeed improved our quality of life, but that is no guarantee whatsoever that the party will not end abruptly in a year, a month, or even tomorrow.”

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To justify my analogy, let me explain why I believe the material resources available to us are functionally finite. (Energy is a somewhat different matter, which I will deal with afterward.)

I have heard advocates of unlimited growth point out that the Earth is nearly 8000 miles across and that the untold mineral wealth of its deep interior remains untouched. This is true. The deepest hole we’ve ever drilled in the Earth is a little less than eight miles deep – about 1/500 of the distance to Earth’s center. However, it should be recognized that the deeper we drill, the greater the investment we must make in both money and energy. Beyond a certain depth, the value of anything we might extract must be less than the investment needed to extract it. While technology might continue to push that frontier deeper for a time, and perhaps find much of value, it is hard to imagine anything in the semi-molten material of Earth’s mantle will ever justify the cost of such a deep well.

We do little better reaching out into space. The cost of getting people and machines out of earth’s gravity well is enormous in both money and energy. We may eventually send human beings to Mars – but we will unlikely do so at a material profit. It is just possible we might one day profitably mine uranium or some other extremely high value material on the moon for export back to Earth, but it is hard to imagine how we could profitably mine iron, copper, or aluminum there. As with exploitation of the deep Earth, it is reasonable to assume that it will always be more efficient to extract our primary physical resources from materials on or near the Earth’s surface, even if the quality of those sources steeply declines from current conditions. To hope that our ingenuity expands these horizons is fine, but to just assume that it will do so is no better than writing a million-dollar check on Wednesday in the hope that you will be able to cover it with lottery winnings by the end of the week.

With the exception of the odd meteorite and occasional new lava flow, all of the matter at our disposal is contained in the top few miles of Earth’s crust, Earth’s oceans, and Earth’s atmosphere. It’s a big box of resources, to be sure, but it is still functionally a finite one.

The energy economy of Earth is rather different. Like the box in my parable, the Earth is not entirely a closed system. The box used external electric current from a power cord, and the Earth takes in a steady flow of electro-magnetic radiation from the sun. Life did all sorts of impressive things with solar energy before we evolved into the curious, inventive, and amusing animals that we are. One of the things life did was store a huge amount of energy in what we call, collectively, fossil fuels. Using that storehouse of energy, we have spent the last two hundred years reorganizing much of the rest of the matter at our disposal to our liking. This, in itself, is neither a good nor a bad thing. It is simply what humanity has done. While the human ingenuity that Simon extols so enthusiastically should not be dismissed, it should not be overstated either. We could not have created the global society we have, with all of its abundance, technology, and incredible physical mobility, without a potent source of energy to exploit. The Romans and ancient Chinese were ingenious people too – but there is only so much one can do with wind and water power.

A new energy economy based chiefly on Earth’s continuous allotment of sunlight isn’t going to be sufficient to maintain the rate of energy consumption fossil fuels have allowed. Many have pointed this out, and I believe their reasoning is sound. Advocates of solar and wind talk about covering huge tracts of Earth’s surface with solar plants or windmills, but such schemes themselves expose the degree to which we take cheap energy (and cheap building materials produced with cheap energy) for granted.1 Windmills do not grow from seeds. They are manufactured at an enormous cost in energy, especially when you take the extraction, refining, and transportation of the materials they are made from into account. Globe-altering engineering projects requiring forests of such machines are problematic undertakings for nations teetering under the economic burden of chronically high fuel costs. I don’t believe, like some alarmists, that we are headed for extinction – but I am entirely confident that the rest of nature isn’t organized to maintain a particular energy intensive way of life that we happen to be fond of.

It is at least imaginable that enough additional fossil fuels will be found to prolong current (or increased) levels of energy consumption for the foreseeable future. There are problems with this expectation however. The first is that the different forms of fossil fuels are not particularly fungible. Gasoline can be made from coal, but it’s a dirty inefficient process that produces rather low quality fuel. Likewise, you are unlikely to find a $50 kit at Walmart that will adapt your car to run on natural gas. Transition from one fossil fuel to another is not pain free. The second problem with new fossil fuel discoveries involves the EROEI (Energy Return On Energy Invested) concept. We have been scouring the globe for fossil fuels (particularly oil) for more than a century. There may be some deposits we haven’t discovered, but we aren’t likely to find another Texas or another Saudi Arabia, with a huge reserve of high quality oil cheaply accessible near the surface. The current oil booms in places like North Dakota are not the result of new discoveries at all, but simply the result of reliably high prices justifying expensive extraction techniques. Score one, I freely admit, for Simon’s market forces. Still, there are limits to squeezing out these dregs. Extracting oil from the Canadian tar sands consumes the equivalent of one barrel of oil to steam three to five others out of the muck. This is not an attractive proposition compared to Texas gushers that once shot oil out of the ground under its own pressure for an energy return of something like 100-to-1. Once an EROEI drops to 1-to-1 (and biodiesel is already close to that rate) the process isn’t worth doing. Energy sources that take as much energy to extract as they themselves produce are functionally not energy sources at all.

It needs to be understood, too, that energy is a special kind of resource. With a few miniscule, irrelevant caveats, our global box of resources contains just as much iron, copper, gold, and other metals as it ever did. Some of the iron is now on the bottom of the sea in the form of rusting shipwrecks, but if we had a large enough supply of cheap enough energy it might eventually be profitable to salvage all the world’s shipwrecks for their iron. Energy is the resource that lets us extract, refine, manipulate, and transport every other resource. With enough energy, one can ultimately recycle practically everything else. Without enough cheap energy, on the other hand, one begins to encounter limits. The “ore” we now extract copper from is mined in such deep pit mines and is of such poor quality that it wouldn’t be worth extracting or refining without cheap energy. Here, really, is my core disagreement with Simon. Commodities have gotten cheaper in the last two hundred years because we have had an abundance of cheap energy available to extract, refine, manipulate, and transport those commodities with. It is true that clever human beings have made the machines that utilize this abundant energy ever more capable and efficient – but energy sources have been steadily consumed during the process. Machinery runs on energy – not imagination.

Having bludgeoned Simon to the best of my ability, I will now lift him up, dust him off, and shower him with the measure of praise I think he’s due.

Few ideas, whether economic, scientific, sociological, or otherwise, come to us without an associated ethos of values and beliefs. No one is exempt from the assumptions of his or her own culture. I think it is fair to say that Simon was a happy member of that culture that believes in free markets and the power of human beings to accomplish great things under their own direction and using their own initiative. You cannot listen to an interview of Simon without getting a strong sense of the admiration he had for a general human capacity to solve problems. Many of Simon’s detractors (though not all – and not I) are creatures of a different worldview altogether. To them, human beings left to their own devices are corrupt, mean, and wantonly destructive – and the only hope for humanity is to put it under the gentle yoke of a group of right-minded planners who will shepherd us along until the sun gives out. I think Simon’s worldview was na├»ve – but the worldview of many of his detractors is loathsome. People vary greatly in ability, but most of them are born with great potential and are capable of much. To be shielded from life’s struggle is a tragedy. I believe that it is better to fail, even catastrophically, than to live out a long but empty existence under the eternal parental oversight of others.

In my parable, you will note, I did not offer up any solutions to the predicament I prophesied. The first solution of the person who believes in central planning would have been to strip the rest of the tenants of any say about how to proceed. If the planner thinks the box might run out, he takes it upon himself to ration the output down to some minimal level in the name of social good. Eventually, planners might even start deciding who does or does not eat at all. The planning committee, history shows us over and over again, always eats first. This state of affairs, in my opinion, is far more objectionable from a moral perspective than simply letting the box run out. If I had carried my parable further, I would have informed my fellow tenants of my views, suggested a search for alternative methods of food production, and left them to reach their own consensus and solutions – or to fail nobly while trying. Better to die a sovereign human being than to live as anything less. Julian Simon, I think, would have agreed.
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1 It is amusing, too, that the same people who believe a few additional ppm of CO2 in the atmosphere might tip the balance toward runaway global warming are unconcerned about the environmental consequences of covering some substantial fraction of Earth’s surface with energy collectors of various kinds. Maybe they too believe that good intentions exempt some human projects from the laws of physics.

February 7, 2014

Decline II

Recently, I was sitting in a Chinese restaurant waiting for a carryout order. Since I was waiting near the counter, I passed the time idly watching the other customers come and go. In the middle of a family-like group of three adults and four children, I witnessed a noteworthy exchange. An average looking kid about twenty or so said something to an average looking boy of about twelve. What he said was:

“I could slice your face off if I wanted to.”

Such a charming claim couldn’t fail to pique my interest. The kid proceeded to show the child a knife blade that he had sewn into his coat, the point protruding slightly at the elbow. The kid then made a kind of gesture with his arm, showing how he might perform his clever face-slicing on an unsuspecting victim. The child reached up and felt the hard edge of the blade underneath the dirty fabric. The child seemed unimpressed and unafraid. The two women in the group, one of whom appeared to be the mother of the children and the girlfriend of the would-be American ninja, took no notice. The mother looked about forty. Her expectations of her slightly acne-speckled boyfriend apparently did not include adult behavior in anything but the most animal sense of the term. Disgusted as I might have been, I admit I saw no actual harm done. No doubt I am out of step for being so judgmental.

In the end, the alternative to being judgmental is simply not to have standards. I remember the late George Carlin saying that the world is a freak show and if you are born in America you have a front row seat. George made a career of being angry about what he saw happening around him. Rebel though he was, he was raised with standards. What he may not have fully realized is that you can only recognize a freak show if you’ve grown up in something other than a freak show. I don’t think the kid with the knife stitched into his coat saw himself as an antisocial deviant. His girlfriend’s child wasn’t scared of him. Likewise, for the girlfriend’s child, the fact that his mother was sleeping with someone who was only a few years older than himself and scarcely any more emotionally mature was probably as normal as the sun coming up in the morning. How could it have been otherwise? Thank God (if you will forgive a quaintly obsolescent phrase) that we have cast off the stultifying moral rigidity of our grandparents and emerged into such an open, free, and non-judgemental new world. Breathe deep. The freedom is so thick that you can almost cut it with a knife.

The popular media reeks with the consequences of several decades of moral nihilism. In the space of a few days Justin Bieber was in trouble twice – first for taking drugs and then for punching a lowly driver in the back of the head. How can this surprise anyone? Could we really expect anything better? What more could we hope for from a creature whose every waking minute has been directed toward the production of whining, vapid songs and to staring at cameras with a certain pouty, helplessly defiant expression – an expression guaranteed to melt the hearts of thirteen-year-old girls and forty-eight-year-old pedophiles everywhere? People who watch meat being shoved into a sausage grinder shouldn’t be surprised when sausages come out. Publicists, agents and media executives are not good molders of the human soul. They just make sausages – at both ends of the machinery. And therein lies the magic. The worthless, valueless, antisocial deviant in front of the television can watch the worthless, valueless, antisocial deviant on the television and see both a reflection and a guide. If you live in a freak show, your role models will probably be freaks.

American teenagers of my day wanted to be rock stars or teachers. Now, as likely as not, they want to be werewolves. Even the werewolves of today have that pouty, helplessly defiant expression though – at least while they are not in wolf form. Peter Pan is now a pitiable victim, even if he has grown an impressive set of teeth. The kid who murdered twelve people and shot up seventy others at the Century movie theater in Aurora, Colorado, wanted to be “The Joker” from Batman. Life, you know, imitates art. I suppose George Carlin never said the front row seat we get by default would be either comfortable or bullet proof.

The young have always, and will always, look to their culture for answers about how to be and how to live. It isn’t good to tear those answers up in front of them, park them in front of a movie, and imagine that by ignoring them you are doing them a favor. The kid I saw with the knife sewn into his coat sleeve clearly wanted to be somebody. The problem was that he just couldn’t find any heroes among real human beings.

(see: Decline )