My latest column for AIER is inspired by the work of the late, great Julian Simon. In this column I summarize Simon’s reasons for rejecting the claim that the earth’s natural environment confronts humans with a maximum “carrying capacity.” Two slices:
Simon argued that humans, at least those of us who live in free societies, are a categorically different sort of species. He observed that to the extent to which we, members of the human species, inhabit a social environment characterized by free and innovative markets, our species does not inhabit a natural environment with a finite carrying capacity. Simon’s argument starts with the fact that we humans are uniquely enterprising and innovative. When this fact combines with the further reality that market prices are signals about which specific resources are becoming more scarce relative to other resources, human entrepreneurship and creativity are incited to discover ways both to make currently known stocks of scarce resources go further and, more importantly, to discover either new sources of those resources or more abundant substitutes. When we succeed in these endeavors, as we now normally do, we literally produce more resources.
Simon’s explanation is revolutionary. Contrary to what most people seem to believe, we don’t obtain resources from an existing stock created for us by nature, leaving fewer resources available for use tomorrow each time we withdraw some amount for our use today. Instead, resources are ultimately fruits of the human mind and effort. And so we produce more petroleum, more tungsten, more copper, more bauxite in the same way that, when our demand for apple pies or Apple laptops increases, we produce more apple pies and Apple laptops.
For humans in market economies, therefore, the environment has no natural ‘carrying capacity.’
As Simon tirelessly documented, his account of humans’ relationship with the natural environment is amply confirmed by history, especially by modern history. Over the past few centuries the human population has grown remarkably – earlier this month it hit eight billion. At the same time there’s also been astounding growth in humans’ standard of living. Were there a natural carrying capacity on earth for the human population, history offers no evidence of it. Quite the contrary.
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Julian Simon died almost twenty-five years ago, just shy of his 66th birthday. Were he still alive today, he would surely celebrate our population of eight billion and remind anyone who would listen that, far from pushing humans closer to the earth’s carrying capacity, the creative potential of those eight billion human minds will further expand our access to resources. We need only to allow this creativity to operate freely.
