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Spot the Contradiction
Daniel Gross's review of Sachs' Common Wealth was bizarre. Consider this:
Even congenital optimists have good reason to suspect that this time the prophets of economic doom may be on point, with the advent of seemingly unstoppable developments like....the explosive growth of China and India.
Huh? What kind of upside down logic makes high growth rates proof of economic doom? Proving this was no idle slip Gross goes on to say:
Things are different today, [Sachs] writes, because of four trends: human pressure on the earth, a dangerous rise in population, extreme poverty and a political climate characterized by “cynicism, defeatism and outdated institutions.” These pressures will increase as the developing world inexorably catches up to the developed world. (emphasis added)
Silly me, I thought rising life expectancy, increasing wealth, and lower world inequality, which is what it means to say that the developing world inexorably catches up to the developed world, was a good thing. And then there is this:
The combination of climate change and a rapidly growing population clustering in coastal urban zones will set the stage for many Katrinas, not to mention “a global epidemic of obesity, cardiovascular disease and adult-onset diabetes.”
Ok, climate change will create problems but how clueless do you have to be not to understand that a large fraction of the world's people would love to live long enough to die from obesity and other diseases of wealth?
Don't misunderstand, I know that growth brings problems. My dispute with Gross is not that he thinks the glass is half-empty and I think it is half-full; my dispute is that Gross thinks the fuller the glass gets the more empty it becomes.
Addendum: Dan Gross writes to say that he was summarizing Sachs' argument. Point noted.
Posted by Alex Tabarrok on May 19, 2008 at 07:36 AM in Books, Economics, Religion | Permalink
Comments
Gross's point doesn't seem to be that the glass is half empty, Alex. He seems to be saying that the glass isn't big enough to handle all the liquid that is filling it up. To keep with this metaphor, he's saying that the fuller it becomes, the more it's going to spill.
Ok maybe the glass metaphor got a little ridiculous just now, but I think it helps illustrate his point.
Posted by: brian at May 19, 2008 7:51:52 AM
Global consumption does not balance global production at the moment, would be the summary, I think.
Posted by: Matt at May 19, 2008 8:18:16 AM
1. The glass is half full.
2. The glass is half empty.
3. You have twice as much as glass as is needed.
Posted by: Gil at May 19, 2008 8:40:32 AM
one problem might be that such thinking persons do not see a way in which everything migh be resolved in future.
I would suggest them simple formula.
First ask.
Does almost inifnite energy resolves the problem? ( taking into account that energy intensive hydroponics could solve any food problem and energy will allow to extract any resources ).
Then , second, point that there are ways to get almost infinite energy with current technology ( it might not look like realistic still it is -
http://www.acm.org/ubiquity/views/v7i28_kumar.html
http://www.aip.org/tip/INPHFA/vol-8/iss-2/p12.pdf
)
There could be other developments as well, still the biggest problem for them - inability to dream ( or ask themselves question - how robotics will affect agriculture ? what will be state of agricultural robotics in near future etc ).
Of cause - it might be that only one of ten such future predictions or ponderings will come true ( to predict unknown is a difficult task ) , but unless the bunch of ideas are launched such persons could really crash the world, cause what they have in mind - to stop development of countries, which is, actually, is impossible.
So some sort of competition of ideas - how to resolve the future problems is neccesary ( something like space race between US and USSR ) ( BTW I like one hypotesis - that the quest for power and resulting competition was a driving force to establish capitalism and modern developments in book Capitalists in Spite of Themselves,
Elite Conflict and Economic Transitions in Early Modern Europe by Richard Lachmann ( some additional examples could be found in From Dawn to Decadence: 500 Years of Western Cultural Life, 1500 to the Present by Jaques Barzun )).
In addition for suggestion of solutions it is neccesary to bring them to understanding - that there is no way to go back and that actually there are ways to resolve future problems. Black death in middle ages was a result of growing cities, still the solution was not to abandon cities, and could not be such. We should move forward and if there are problems we should be in rush.
Posted by: Sergey Kurdakov at May 19, 2008 8:44:15 AM
As a third-worlder, reading Gross's take on the future burns on so many levels it's hard to know where to start...I guess several larger points must be explored, firstly we have always been on a Malthusian race against poverty, which is a population accelerator. The faster the economic convergence of highly populated, developing countries, the lower the eventual peak human population. Rapid economic growth, besides mass genocide, is the only potential solution. But anyone who can think basically understands this.
I guess what Gross shows is a form of myopic ethno-centrisism, in as much as he is utterly incapable of seeing the tens of millions of potential engineers, scientists, artists, entrepreneurs and creative thinkers, that are locked up in dire poverty in these developing world populations. If 800 million or so Americans, Europeans, Japanese and a smattering of others, can generate all the technologies, political models, cultural creations and various extraordinary accomplishments, that have began our species thrust out of endemic crushing poverty, why would not five or six billion people proffer exponentially greater potential to the species in solving the vary same problem set, but in this case inclusive of a context of finite physical resources. To look at medieval Europe and see what amazing progress eventually sprang from that cesspool, and not look at Africa, or Latin America, and realize the potential therein, is I think the heart of the matter.
Human history is replete with new rising civilizations adapting from established ones and pioneering new modalities. As an African I keep a fifty year scale when looking at the progress of our species, there is so much to be excited about, I cant wait to see how a developed Brazil, Angola and Cambodia approach the challenges of the planets future. I think it will do wonders for the west, after overcoming some the initial rude shocks, when global opinion becomes unavoidable in the latter half of this century. The west having done so much heavy lifting in recent centuries, grow to welcome everyone else pitching in.
Posted by: nyongesa at May 19, 2008 9:16:39 AM
Gross' apparent indifference to billions of the world's citizens is among the most bigoted sentiments I've ever come across.
Posted by: josh at May 19, 2008 9:28:08 AM
Maybe he thinks of the developed world as the mafia stealing from the planet. As long as they are only a few, the mafioso are rich and the rest of the world putters along in misery. When *everyone* is the mafia, then we're all exploiters, there's no exploitees and we all die.
Posted by: Tom West at May 19, 2008 9:34:23 AM
Gross and company need to be reminded again and again that populations are growing becuase the death rate is falling not becuase the birth rate is rising.
Posted by: Floccina at May 19, 2008 10:01:40 AM
I take it the reviewer is looking at economics as a zero-sum game, as many of the illiterates do. If India and China are becoming wealthier, then they're taking our money, and it's going to cause us ruin! Oh no!
The great thing about economic output, however, is that it we want a slice of the pie, we don't have to take somebody else's... we just bake another pie (and, perhaps, sell what we don't eat of that).
Posted by: Michael Fisk at May 19, 2008 10:12:24 AM
Populations grow when birth rate exceeds death rate. Global death rates fell rapidly during C19 and C20. Where population stabilized, birth rates fell. Where population continued to grow, birth rates did not fall enough to equal death rates.
Posted by: Don at May 19, 2008 10:12:53 AM
Silly me, I thought rising life expectancy, increasing wealth, and lower world inequality, which is what it means to say that the developing world inexorably catches up to the developed world, was a good thing
In the context of the original sentence the phase "the developing world inexorably catches up to the developed world" means increased usage of raw materials over triple current amounts.
Dispite his protest, Alex just wants to disparging people the sustainability of the current system just as when he called people who thought it was a bad idea to give loans to people to buy a house 7 times their yearly income elitist credit snobs.
Posted by: sort_of_knowledgeable at May 19, 2008 10:31:14 AM
I've always found Gross' articles entertaining, but read closely and in most of his articles you'll find similar reasoning that makes you scratch your head.
I remember one where he argued the stock market was irrational because smart people can't predict it. Therefore the whole thing was a crap shoot. Well, investing is largely a crap shoot. But not being able to predict something doesn't mean its irrational. You don't know in advance what a company's earnings report will show, but you can look back and say, "the price dropped becuase of poor earnings."
This is another example of his bizarre reasoning. Interesting read, and I understand the "cup isn't big enough" concern, but to not acknowledge the benefit to millions of people is either short-sighted or deliberately misleading.
Posted by: sandyspecial at May 19, 2008 11:05:53 AM
The comment about first world disease is stupid and near-sighted. However, because the argument is poorly made, does not mean there is a glimmer of a decent argument lying underneath. The main point is the question of whether the world, both in terms of climate and pure raw materials can sustain a western European and NOrth American lifestyle for 4 to 5 times the current population and there are perhaps good reasons to suggest that it can't.
Isn't one of the cardinal rules of economics that there are finite resources? Economic growth doesn't change this on the most fundamental level and the question of where China and India are going to get enough water is just one example of some of the limitations we may start bumping up against. Admittedly these problems are far from certain, but they are perhaps worrying enough to be taken seriously rather than ridiculed (see above). GDP growth does not increase the amount of copper or iron in the world. This is not to say that technological improvement won't get us around some of these problems.
The main point however, is that there IS a limit to the number of people who can live an average American life on this planet regardless of technological advances and it maybe helps to have people thinking about how small this number might be and what should be done about it.
Posted by: AS at May 19, 2008 11:15:30 AM
The main point is the question of whether the world, both in terms of climate and pure raw materials can sustain a western European and NOrth American lifestyle for 4 to 5 times the current population and there are perhaps good reasons to suggest that it can't.
that is good point and answer is yes, it can sustain.
There was shown ( I read few reseach papers on the topic ) that it is possible to reduce material consumption two three times without sacrificing the level of consumption - just make less waste.
another point that in future it is possible to lower material demand even more by more recycling, which could be economical with lower energy price ( see links in my post above ).
Now the debate is about is that one side says - look it is possible , though it is not here yet ( and will require efforts in paticular directions ), another side says - no efforts - just poor people should live poor, and we cannot fix it, cause we 'are lazy persons' and do not wish to move, and to guess otherwise is unethical and almost pure humilitation etc.
But it is unethical to ignore that it is actually possible to resolve all the issues.
Posted by: Sergey Kurdakov at May 19, 2008 11:39:25 AM
AS, maybe you are right, maybe not. But Gross doesn't argue that growth will slow down instead he says that the "developing world inexorably catches up to the developed world."
Many excellent comments on this thread. Especially enjoyed nyongesa and Tom West's hypothesis.
Posted by: Alex Tabarrok at May 19, 2008 11:41:29 AM
I agree with AS and disagree with Sergey ("it is actually possible to resolve all the issues"), taking my cue from the carrying capacity and sustainability literature. Although Gross may be a bigoted, first-worlder (and I don't know), what he may be getting at is the *fact* that we are now pushing against the Earth's finite resources in ways that were never done in the past. I am not one to say that the OECD deserves it, but the OECD countries got their snouts in the trough before the developed world and there is not much slop left to go around. As much as I love technology, I do not think it's going to solve ALL the problems. It is in this way that I think brian's comment (#1) was absolutely right. Read more about these issues here and here.
Posted by: David Zetland at May 19, 2008 11:51:05 AM
Gross, like Sachs, is a left-wing nut case.
I suggest you read Julian Simon's paper on population growth and economic growth. Also, as people become more affluent, population growth stalls. Look at Western Europe. The real danger is they become net consumers instead of net producers as the population gets older.
Posted by: jorod at May 19, 2008 12:26:21 PM
In the context of the original sentence the phase "the developing world inexorably catches up to the developed world" means increased usage of raw materials over triple current amounts.
The reason that they "catch up" in resource use is that they "catch up" in wealth or technology - at least that they are able to use that many resources because they are producing (and consuming) so much more.
Which brings us to the astonishing fact that Gross manages to try to make this a bad thing.
People in poverty, starving, dying at ages we consider to be our prime now benefiting from rapid growth and catching up to us in the only way possible to increase standard of living, by increasing output per capita- this is a bad thing?
That is the height of arrogance and insensitivity to the plight of others. Unless he can prove imminent danger to the planet similar to a nuclear explosion, it is disgusting to worry more about resource use than about those impoverished and short lives.
Economic growth creates resources; the outlook is based on zero sum fallacies, and is heartless and cruel.
Posted by: liberty at May 19, 2008 12:46:55 PM
Thanks for the Gross fisking, Alex. I have enjoyed doing the same to many of his boneheaded Slate pieces over the last several years.
How he maintains his reputation as a leading economics commentator is beyond me.
It seems obvious that:
- Everyone has the right to earn a better life.
- Some resource is always under pressure. Capitalism produces innovation to relieve it.
- If we tried to maintain Western lifestyles using the technology of even one generation ago, we would create an environmental catastrophe. Conversely, we will be able to support better lives for billions more with the technology of the next generation without such a catastrophe.
- While we will never have infinite energy, we may accumulate effectively infinite knowledge and that cannot harm the environment.
Posted by: Larry at May 19, 2008 12:48:45 PM
Gross is the worst.
Posted by: Mercutio.Mont at May 19, 2008 1:07:51 PM
Actually Daniel Gross's review is not that bad. What's missing from Sachs and Gross is engagement with the argument that feedback from the markets is a better solution to these challenges than a big government plan.
Posted by: PJ at May 19, 2008 1:08:27 PM
The patient does well with 50% kidney function and is oblivious, has trouble at 20%, and at 5-10% prays for a transplant .Gross is correct on the concept . This is one reason RUSSIA will do fine this century with low population,great natural assets and with the might that even its neighbor China will not tread on it.Read energybulletin.net for a week .If you grew up in isolation when would you develop the concept of your own death?Just because the crisis is not obvious to all does not mean it will not occur .
Posted by: Lowrie Glasgow at May 19, 2008 1:17:13 PM
Great post, Alex. I hear Gross a lot on NPR too, and he is usually very smug. He seems to like to have the position of, 'I know some people are telling you things will be better in the future, but they're wrong. And don't you hate rich people?'
I loved this comment from above;
To look at medieval Europe and see what amazing progress eventually sprang from that cesspool, and not look at Africa, or Latin America, and realize the potential therein, is I think the heart of the matter.
Posted by: Bob Murphy at May 19, 2008 1:21:35 PM
"I guess what Gross shows is a form of myopic ethno-centrisism, in as much as he is utterly incapable of seeing the tens of millions of potential engineers, scientists, artists, entrepreneurs and creative thinkers, that are locked up in dire poverty in these developing world populations."
This bears repeating, and it shows how backwards thinking like Gross's is. People are more than just hungry mouths. Would the world be better off if half of U.S. engineers, scientists, and entrepreneurs were living at barely subsistence levels? Why not? They'd be consuming fewer natural resources, after all.
Posted by: anon. at May 19, 2008 1:34:56 PM
Deaths from cardiovascular disease have been decreasing in the US and other developed countries for year. Why would we thus conclude that as developing countries become richer they will somehow have *more* deaths from CVD? I suppose they might live longer, such that now they die too young to get it?
Posted by: Andy at May 19, 2008 3:02:10 PM
