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> The report’s authors warn that treating the world’s resources as limitless is leading towards global disaster. This is the same fallacy that lead people to f

> The report’s authors warn that treating the world’s resources as limitless is leading towards global disaster. This is the same fallacy that lead people to fear “peak oil” every decade for the past 50 years. Nobody treats resources as if they’re limitless. The reason we don’t coat everything in gold is because it’s rare (and thus expensive), leading to producers only using it when it’s absolutely necessary. Wood is abundant (and therefore cheap), so it’s used in everything from packing materials to building houses. If these conditions changed and wood for some reason became rare and expensive, it wouldn’t be used in the same way we use it now. People would choose to build their houses out of a different material, and tree farmers would choose to plant more trees. The idea that we’re “running out” of resources doesn’t make sense. Resources are and have always been scarce. When something becomes exceedingly rare, people choose to consume less of that resource.

jariel 7y ago
This is all true but markets don't always have great foresight, and there are entire tranches of externalities to worry about. For example, the market doesn't really care if a tree is 'new growth' gown for consumption, and a 300 year old 'old growth' tree, the loss of which has some material impact. It might be cheaper in many cases to fell old forests, in which case we're pricing poorly. So let's get all the externalities in there and see what the numbers look like.
- titzer 7y ago
  I am skeptical that more terms in equations can quantify the effect of losing, e.g. biodiversity. Markets have shown time and again they cannot effectively price long-term risks, and people are irrational and unable to account for costs that are farther in the future than their own lifetime.
  - sdenton4 7y ago
    "unable to account for costs that are farther in the future than their own lifetime." ...if ever 'ok, boomer' were an appropriate response, it would be here. Some of us will be alive for quite a while, relative to the current rate of changes...
    - jmknoll 7y ago
      The post you’re responding to says “people are irrational and unable to account for costs that are farther in the future,” not “I don’t care about costs that are farther in the future than my own lifetime.”
  - jariel 7y ago
    It's fuzzy, but that doesn't make it invalid. Consider that a ban on cutting 'old growth forests' is really just a 100% tax in market terms. Carbon taxes can be calculated to have a specific effect, though the impact of the revenue itself on green R&D etc. is impossible to really measure.
    - titzer 7y ago
      I respectfully disagree. It's not just fuzzy, it's completely wrong. Imagine 200 years ago asking an economist to estimate the cost of destroying 100kg of pure Uranium 235. They simply did not understand its value, not only because it could not be utilized with current technology, they did not even understand what technology could utilize it. Worse, if they understood radioactivity, which they didn't, they might consider it to have negative value, because U235 is highly radioactive and will absolutely give you acute radiation poisoning. However, today that amount of nuclear fuel would be worth millions, if not billions of dollars. We have the same situation, but not with materials for consumption, but the natural world, in particular, rainforests. In 200 years we might actually have half a chance of understanding what we're destroying in 2020.
coldtea 7y ago
>This is the same fallacy that lead people to fear “peak oil” every decade for the past 50 years It's not a fallacy that we treat resources as limitless, and neither is peak oil. This or that peak oil announcement might be premature, but oil is limited and not renewable, so peak oil is inevitable long term, period. Already we have started to resort to hacks like fracking and lower EROI oil to get by. >Nobody treats resources as if they’re limitless. Plenty do. We consume and build stuff like there's no tomorrow. That we will adjust prices and production when we hit hard limits doesn't mean that we already take those into account and shape our use accordingly (based on actual priorities). And of course we have tons of local (not overall market) cases where resources are treated like limitless without going into peak oil and such. E.g. a river that a factory uses as a dumping ground until the waters are toxic and everything in it dies is exactly an example of a resource treated as limitless. As long as X resource is cheap, we use it for whatever BS we make. When it gets rarer and pricier, sure, higher prices will regulate its use towards more serious stuff. But by then we'd already have lost huge, non recoverable, and often non recyclable either, quantities of it to BS uses. >If these conditions changed and wood for some reason became rare and expensive, it wouldn’t be used in the same way we use it now. Which is a moot point, if by then we have exhausted say 80% of a resource for the previous frivolous uses, and we still need it for more serious uses going forward.
- omgwtfbyobbq 7y ago
  While we can hit harder limits with some resources, like Helium, I believe most resources are far more fungible and/or replaceable. That's in part why peak oil announcements seem to be habitually premature. Reserves are at a specific price or price range, so if those go up reserves tend to go up too, and the same applies to other resources. To further complicate things, we can replace oil in different ways depending on cost and alternatives, which also depend on time. Toss in a wide variety of different priorities, and it becomes apparent why many predictions we've made tend to be inaccurate.
  - brosinante 7y ago
    I believe most resources are far more fungible and/or replaceable Ok.
monadic2 7y ago
I think the idea is that it’s better to reign in consumption before austerity hits.
EGreg 7y ago
“Wood is cheap because it is abundant” Wood comes from a living organism. If we destroy an ecosystem or habitat, then it won’t be renewed. We have engaged in... Overfishing, fish are gone Kelp forests are gone Coral reefs are disappearing Many species are gone One third of the world’s farmland has become incapable of sustaining food using normal production, depleted nutrients (desertification) We are also killing biodiversity on the planet Insect populations plummeting Bird populations And you’re sitting here thinking about monetary costs only. It’s like a guy sitting in a house on fire playing a video game of Red vs Blue yelling YEA!!!! WE ARE WINNING!!! Except we ALL live in this house, and we have to shut off the game and put out the fire like NOW.
esotericn 7y ago
That doesn't match with my experience of the world around us. Rather it seems like what we've done is initially used a load of resource (e.g. low mpg cars, massively overbuilt bridges, buildings, etc) and then started to optimize later. It seems more likely to me that we enter a regime whereby lots of stuff is needlessly expensive compared to what it could have been if we'd rationed properly from the get go.
- rabidrat 7y ago
  And then there's Jevons Paradox[0], which notes that higher efficiency leads to greater overall consumption. [0] https://en.wikipedia.org/wiki/Jevons_paradox https://en.wikipedia.org/wiki/Jevons_paradox
  - lostlogin 7y ago
    From that: “However, this does not imply that improved fuel efficiency is worthless if the Jevons paradox occurs; higher fuel efficiency enables greater production and a higher material quality of life.” Good link, thanks.
gwbas1c 7y ago
> The idea that we’re “running out” of resources doesn’t make sense. Resources are and have always been scarce. When something becomes exceedingly rare, people choose to consume less of that resource. I think looking at this as purely a matter of price is just a way to ignore the problem. Let's say I happen to own a large supply of a limited resource. I can sell that resource so it's cheap for everyone else, yet in volume, I get very rich. The problem is that resource will run out at some time in the future. My incentive is to sell it now and make sure that it lasts long enough to build me a nice fat retirement fund. Who cares about people 200 years from now.
- friendlybus 7y ago
  Why would you sell a scarce resource for cheap? Your incentive is to ride the supply & demand line.
  - beambot 7y ago
    Time plays a factor in IRR too.
  - gwbas1c 7y ago
    > My incentive is to sell it now and make sure that it lasts long enough to build me a nice fat retirement fund. Who cares about people 200 years from now.
    - friendlybus 7y ago
      Yes but it's scarce. As he sells the price goes up so he controls the outcome. His nest egg permanently exists because it's limited, the supply will always drop. Selling the last dregs of helium for military contracts or private industry will eclipse any reasonable monetary requirements. He can hang on to the smallest amount for a long time. If helium doesn't sell for that much at the last point then it wasn't worth that much anyway and he couldn't build a nest egg off a normal sale price. I don't get it.
lalos 7y ago
What you are claiming is that the market is 100% efficient but history and just knowing how business work says otherwise. The thing is that resources that have been mismanaged by the market are long gone so you don’t hear much about them. For example Galapagos island turtle meat was a great industry until they were all wiped out except a few in a remote island. The market takes time to react, for example if you sell something that turns out to be toxic, it takes time for the market to react (cigarette industry).
NeedMoreTea 7y ago
Europe clear cut most of their trees in the Middle Ages to such an extent that monarchs were forbidding the use of wood for numerous non-naval uses. It was one of those edicts forbidding use of wood in glass production, and a bunch of other uses that tipped the UK toward the industrial revolution. Coal became far more widely used, whereas it had previously been seen as dirty and to be avoided. Some see that lack of wood as a push to colonise. If we're talking regeneratable resources, such as plants and wood, we've exceeded the capacity of the planet since about 1970. It's been measured by earth overshoot day[1], which has steadily been getting earlier since its first calculation of Dec 31st. In 2019 it was July 29. We would need 1.7 earths to sustainably supply the resources we use. Humanity already uses over 50% of the earth's land -- the best, most productive, most fertile 50% for our homes and agriculture, and what's left is the least productive and unusable. The idea that we're not running out on a finite planet, with exponentially growing population, and nearly all the productive landmass already in service of humanity is what doesn't make sense. [1] https://en.wikipedia.org/wiki/Earth_Overshoot_Day https://en.wikipedia.org/wiki/Earth_Overshoot_Day
Scarblac 7y ago
And yet we are in the middle of a Great Extinction event. The numbers of lots of species turned out to be finite and market forces didn't prevent their extinction.

jariel 7y ago

This is all true but markets don't always have great foresight, and there are entire tranches of externalities to worry about. For example, the market doesn't really care if a tree is 'new growth' gown for consumption, and a 300 year old 'old growth' tree, the loss of which has some material impact. It might be cheaper in many cases to fell old forests, in which case we're pricing poorly. So let's get all the externalities in there and see what the numbers look like.

titzer 7y ago
I am skeptical that more terms in equations can quantify the effect of losing, e.g. biodiversity. Markets have shown time and again they cannot effectively price long-term risks, and people are irrational and unable to account for costs that are farther in the future than their own lifetime.
- sdenton4 7y ago
  "unable to account for costs that are farther in the future than their own lifetime." ...if ever 'ok, boomer' were an appropriate response, it would be here. Some of us will be alive for quite a while, relative to the current rate of changes...
  - jmknoll 7y ago
    The post you’re responding to says “people are irrational and unable to account for costs that are farther in the future,” not “I don’t care about costs that are farther in the future than my own lifetime.”
- jariel 7y ago
  It's fuzzy, but that doesn't make it invalid. Consider that a ban on cutting 'old growth forests' is really just a 100% tax in market terms. Carbon taxes can be calculated to have a specific effect, though the impact of the revenue itself on green R&D etc. is impossible to really measure.
  - titzer 7y ago
    I respectfully disagree. It's not just fuzzy, it's completely wrong. Imagine 200 years ago asking an economist to estimate the cost of destroying 100kg of pure Uranium 235. They simply did not understand its value, not only because it could not be utilized with current technology, they did not even understand what technology could utilize it. Worse, if they understood radioactivity, which they didn't, they might consider it to have negative value, because U235 is highly radioactive and will absolutely give you acute radiation poisoning. However, today that amount of nuclear fuel would be worth millions, if not billions of dollars. We have the same situation, but not with materials for consumption, but the natural world, in particular, rainforests. In 200 years we might actually have half a chance of understanding what we're destroying in 2020.

coldtea 7y ago

>This is the same fallacy that lead people to fear “peak oil” every decade for the past 50 years It's not a fallacy that we treat resources as limitless, and neither is peak oil. This or that peak oil announcement might be premature, but oil is limited and not renewable, so peak oil is inevitable long term, period. Already we have started to resort to hacks like fracking and lower EROI oil to get by. >Nobody treats resources as if they’re limitless. Plenty do. We consume and build stuff like there's no tomorrow. That we will adjust prices and production when we hit hard limits doesn't mean that we already take those into account and shape our use accordingly (based on actual priorities). And of course we have tons of local (not overall market) cases where resources are treated like limitless without going into peak oil and such. E.g. a river that a factory uses as a dumping ground until the waters are toxic and everything in it dies is exactly an example of a resource treated as limitless. As long as X resource is cheap, we use it for whatever BS we make. When it gets rarer and pricier, sure, higher prices will regulate its use towards more serious stuff. But by then we'd already have lost huge, non recoverable, and often non recyclable either, quantities of it to BS uses. >If these conditions changed and wood for some reason became rare and expensive, it wouldn’t be used in the same way we use it now. Which is a moot point, if by then we have exhausted say 80% of a resource for the previous frivolous uses, and we still need it for more serious uses going forward.

omgwtfbyobbq 7y ago
While we can hit harder limits with some resources, like Helium, I believe most resources are far more fungible and/or replaceable. That's in part why peak oil announcements seem to be habitually premature. Reserves are at a specific price or price range, so if those go up reserves tend to go up too, and the same applies to other resources. To further complicate things, we can replace oil in different ways depending on cost and alternatives, which also depend on time. Toss in a wide variety of different priorities, and it becomes apparent why many predictions we've made tend to be inaccurate.
- brosinante 7y ago
  I believe most resources are far more fungible and/or replaceable Ok.

monadic2 7y ago

I think the idea is that it’s better to reign in consumption before austerity hits.

EGreg 7y ago

“Wood is cheap because it is abundant” Wood comes from a living organism. If we destroy an ecosystem or habitat, then it won’t be renewed. We have engaged in... Overfishing, fish are gone Kelp forests are gone Coral reefs are disappearing Many species are gone One third of the world’s farmland has become incapable of sustaining food using normal production, depleted nutrients (desertification) We are also killing biodiversity on the planet Insect populations plummeting Bird populations And you’re sitting here thinking about monetary costs only. It’s like a guy sitting in a house on fire playing a video game of Red vs Blue yelling YEA!!!! WE ARE WINNING!!! Except we ALL live in this house, and we have to shut off the game and put out the fire like NOW.

esotericn 7y ago

That doesn't match with my experience of the world around us. Rather it seems like what we've done is initially used a load of resource (e.g. low mpg cars, massively overbuilt bridges, buildings, etc) and then started to optimize later. It seems more likely to me that we enter a regime whereby lots of stuff is needlessly expensive compared to what it could have been if we'd rationed properly from the get go.

rabidrat 7y ago
And then there's Jevons Paradox[0], which notes that higher efficiency leads to greater overall consumption. [0] https://en.wikipedia.org/wiki/Jevons_paradox https://en.wikipedia.org/wiki/Jevons_paradox
- lostlogin 7y ago
  From that: “However, this does not imply that improved fuel efficiency is worthless if the Jevons paradox occurs; higher fuel efficiency enables greater production and a higher material quality of life.” Good link, thanks.

gwbas1c 7y ago

> The idea that we’re “running out” of resources doesn’t make sense. Resources are and have always been scarce. When something becomes exceedingly rare, people choose to consume less of that resource. I think looking at this as purely a matter of price is just a way to ignore the problem. Let's say I happen to own a large supply of a limited resource. I can sell that resource so it's cheap for everyone else, yet in volume, I get very rich. The problem is that resource will run out at some time in the future. My incentive is to sell it now and make sure that it lasts long enough to build me a nice fat retirement fund. Who cares about people 200 years from now.

friendlybus 7y ago
Why would you sell a scarce resource for cheap? Your incentive is to ride the supply & demand line.
- beambot 7y ago
  Time plays a factor in IRR too.
- gwbas1c 7y ago
  > My incentive is to sell it now and make sure that it lasts long enough to build me a nice fat retirement fund. Who cares about people 200 years from now.
  - friendlybus 7y ago
    Yes but it's scarce. As he sells the price goes up so he controls the outcome. His nest egg permanently exists because it's limited, the supply will always drop. Selling the last dregs of helium for military contracts or private industry will eclipse any reasonable monetary requirements. He can hang on to the smallest amount for a long time. If helium doesn't sell for that much at the last point then it wasn't worth that much anyway and he couldn't build a nest egg off a normal sale price. I don't get it.

lalos 7y ago

What you are claiming is that the market is 100% efficient but history and just knowing how business work says otherwise. The thing is that resources that have been mismanaged by the market are long gone so you don’t hear much about them. For example Galapagos island turtle meat was a great industry until they were all wiped out except a few in a remote island. The market takes time to react, for example if you sell something that turns out to be toxic, it takes time for the market to react (cigarette industry).

NeedMoreTea 7y ago

Europe clear cut most of their trees in the Middle Ages to such an extent that monarchs were forbidding the use of wood for numerous non-naval uses. It was one of those edicts forbidding use of wood in glass production, and a bunch of other uses that tipped the UK toward the industrial revolution. Coal became far more widely used, whereas it had previously been seen as dirty and to be avoided. Some see that lack of wood as a push to colonise. If we're talking regeneratable resources, such as plants and wood, we've exceeded the capacity of the planet since about 1970. It's been measured by earth overshoot day[1], which has steadily been getting earlier since its first calculation of Dec 31st. In 2019 it was July 29. We would need 1.7 earths to sustainably supply the resources we use. Humanity already uses over 50% of the earth's land -- the best, most productive, most fertile 50% for our homes and agriculture, and what's left is the least productive and unusable. The idea that we're not running out on a finite planet, with exponentially growing population, and nearly all the productive landmass already in service of humanity is what doesn't make sense. [1] https://en.wikipedia.org/wiki/Earth_Overshoot_Day https://en.wikipedia.org/wiki/Earth_Overshoot_Day

Scarblac 7y ago

And yet we are in the middle of a Great Extinction event. The numbers of lots of species turned out to be finite and market forces didn't prevent their extinction.