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Sunday, Mar 12, 2006


Doomsayers and doomslayers

On the 25th anniversary of Julian Simon's famous bet on the future of the planet, a look at the ways in which we see our tomorrow.

Image result for julian simon

IN August last year, Matthew Simmons, author of Twilight in the Desert, laid a bet with John Tierney. Simmons predicted that oil prices will soar into the triple digits, and backed his assertion with $5,000.
So, will oil be $200 in 2010? Remember, what you believe will slot you as either a doomsayer or doomslayer.

More is better
To cast further light on the Doomsayers and Doomslayers, we need to go back to 1980, when Paul R. Ehrlich, author of The Population Bomb and an economist, Julian L. Simon of the University of Maryland, laid a bet.
Dr. Simon had unveiled his rather radical vision of human progress inScience magazine in 1980, positing that population growth is more boon than bane, since it would invariably lead to a cleaner environment, healthier humanity and more abundant supplies of food and raw materials. Ehrlich's rebuttal of this premise was basically simple arithmetic: the planet's resources had to be divided among a population that was then growing at the unprecedented rate of 75 million people a year. The warning was clear: population growth was outstripping the earth's supplies of food, fresh water and minerals.
Simon offered to let anyone pick any natural resource — grain, oil, coal, timber, metals — and any future date. If the resource really were to become scarcer as the world's population grew, then its price would rise. Simon wanted to bet that the price would instead decline by the appointed date. Ehrlich formed a consortium with colleagues at the University of California at Berkeley specialising in energy and resource questions, and in October 1980, the group bet $1,000 on five metals — chrome, copper, nickel, tin and tungsten — in quantities that each cost $200 in the current market. A futures contract was drawn up obligating Simon to sell Ehrlich and company, these same quantities of the metals 10 years later, but at 1980 prices. If the 1990 combined prices turned out to be higher than $1,000, Simon would pay them the difference in cash. If prices fell, they would pay him.
Ehrlich lost the bet in the fall of 1990. He sent Simon a cheque for $576.07. Simon wrote back a thank you note, adding that he would be willing to raise the wager to as much as $20,000, pinned to any other resources, and to any other year in the future. The offer was not taken up. Dr. Julian Simon died in 1998.
Ehrlich was to say, in an interview, "The bet doesn't mean anything. I still think the price of those metals will go up eventually but that's a minor point. The resource that worries me the most is the declining capacity of our planet to buffer itself against human impacts. Look at the new problems that have come up: the ozone hole, acid rain, global warming."
Which, of course, brings to mind yet another of Dr. Simon's statements: "As soon as one predicted disaster doesn't occur, the doomsayers skip to another. They deny our creative powers for solutions."

The positive view
Julian Simon, was, of course, a card-carrying member of the Doomslayers. In his tour de force, The Ultimate Resource, he joined battle with the conventional belief of the day, that consumption, population, mindless growth was eroding the very fabric of our lives. Not so, said Dr Simon. "Our species is better off in just about every measurable material way. "
"Resources come out of people's minds more than out of the ground or air," said Dr. Simon. "Minds matter economically as much as or more than hands or mouths. Human beings create more than they use, on average. It had to be so, or we would be an extinct species."


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