Wednesday, October 31, 2007

Price at the Peak

Many environmentalists and ecologists believe that world consumption has already exceeded the amount our planet can naturally replenish (in 1990). At that time, the global ecological footprint, a measure of that consumption, was growing at an annual rate of about 1.5 percent; by now it has nearly doubled that rate.

Based on my projections of the footprint’s growth, the world’s population will peak when GWP per unit of IP index (average of normalized life expectancy and happiness, multiplied by normalized population) is 174 percent of its 1990 value. At that time, in 2020, footprint per IP will be 155 percent of its 1990 value. That is, the economic cost of our existence will be three-fourths more, and the ecological cost of our existence will be one-half more. We will also have just doubled the total amount of resources we were using in 1990.

After the population peaks, more people will die than are born. Over the following 20 years the costs of survival will spike to over triple their 1990 values. Within 30 years of the peak most if not all of the population will be dead.

If we buy time by conserving as I suggested earlier (reducing consumption by one percent per decade saved, maintained over the number of decades to be saved), the economic cost will rise even as the ecological cost drops. As with business as usual, when the additional economic cost (since 1990) exceeds three-fourths what it was then, the population will reach a maximum. The decline of population will however take much longer.

Tuesday, October 30, 2007

Increasing Waste

From 1965 to 2005, the world’s population grew a total of 94 percent (between one and two percent annually). Ideality and population multiplied together (the IP index, where population is percentage of the projected maximum of 7.13 billion) increased 86 percent.

Assuming our economy has generated ideality and population growth, we paid mostly for population growth plus something else. Gross World Product per unit of IP index grew from $482 billion to $1,053 billion or 118 percent over 40 years (about two percent per year).

If the principal product was IP index, the “something else” can be classified as waste.

Monday, October 29, 2007

Waste of Money

Through the 1960s, the world’s ideality barely changed from one year to the next, yet the Gross World Product and consumption (measured by the global ecological footprint) increased an average of five percent per year. By 1990, GWP was adding three percent per year and consumption was adding one percent per year, while ideality was still hardly changing. Now, GWP and consumption are both increasing at three percent per year while ideality remains effectively constant from one year to the next. From 1965 to 2005, GWP increased a total of 315 percent, consumption increased by 186 percent, and ideality decreased by four percent.

What has the world been paying for? From the viewpoint of happiness and life expectancy, our economic activity has been wasted and somewhat counterproductive. If we believed we were contributing to a better life, we were dishonest with ourselves or misled (an observation corroborated by the increase in ignorance indicated by the adjusted power measure).

Sunday, October 28, 2007

Unsustainable Growth

Exponential growth, by its nature is unsustainable. Even if we could consume all matter, the amount of resources reachable each year (consumption) would ultimately be limited by the maximum speed that we could attain, and even with the most advanced conceivable technologies, the laws of physics won’t let us exceed the speed of light. Consequentially a population addicted to such growth is bound to be disappointed.

Gross World Product, the world’s GDP, tends to vary linearly with cumulative consumption (total mass consumed). Exponential growth in the world’s economy is therefore accompanied by an exponential growth in cumulative consumption and its attendant waste. As we approach the limits of our consumable resources and the speed with which we can access them and process them into usable products, our growth is rapidly impeded by the deleterious impact of the waste we cannot “externalize” (put in a place where it won’t harm us).

Those parts of our population that consume the most have chosen to put their waste in places where it does not directly affect them, causing others less powerful to deal with its burdens. As the world has become more integrated, the quantity of waste has grown beyond the ability of the poor to deal with it. Everyone must now deal with the consequences: In decreased health, violence against the polluters, and damage to global climate and biological systems which support us all.

Friday, October 26, 2007

Information and Growth

Labeling on food and other products is one approach to providing knowledge to people when they make a buying decision, summarizing types of information such as contents and nutrition. Like the products themselves, there are competing demand for types of information, and except where government (as an agent of society) deigns to regulate it, the “market” tends to determine what is available.

The market and society have so far determined that most chemical compounds used in products do not need to be tested for their long-term health impact prior to being used. Now that people are discovering huge amounts of industrial chemicals in their bodies, this situation may change; but may enough awareness to influence demand come too late to avert the most serious possible outcomes (among them a massive health crisis)?

This discussion illustrates one possible explanation for the apparent increase in false knowledge over the past 40 years: a devotion to economic growth at the expense of due diligence in determining the impact of our actions on other people, thus providing information they would need to know to decide whether or not to support our growth.

Thursday, October 25, 2007

Redefining Limits

There are two fundamental limits to future growth in ideality and population: power and knowledge. The apparent inability of adjusted power to get much above 50 in a period when energy has been cheap implies that the entire population is constrained in meeting more than one-fourth of its needs or at least half the population is destined to remain ignorant.

Power, the fraction of needs met, can be improved through technology, social cooperation (coordination of activity), and increased energy. Technology and energy have been ample, while cooperation has had a mixed record (consider, for example, the wars that have occurred since the 1920s, which exemplify attempts by a minority to horde resources and constrain the behavior of the majority). As we approach limits to energy and other resources, maximum power will tend to drop. Increasing levels of waste in our environment, which includes toxic chemical compounds and climate changing gases, are driving down the populations of most species and limiting ours through deterioration of health, natural disasters, and our dependence on those other species.

The ability of people to perceive the action required to meet their needs is a function of innate intelligence, access to complete and accurate information, and understanding of how the world works. This can be maximized through education (sharing knowledge), research (expanding the total amount of knowledge), and honest communication (sharing current experience). In my studies of theoretical populations, increasing everyone’s knowledge is the most reliable way to maximize happiness.

Wednesday, October 24, 2007

Declining Power

Based on a polynomial curve fit of happiness and life expectancy to per capita footprint, the steepest increase in population growth corresponds to the period since adjusted power first cleared 50, in the 1920s. Adjusted power leveled off until the 1960s, when it began a drop that corresponded to a slowing of population growth. There was a leveling of adjusted power around 45 between 1980 and 2000, followed by resumption in the decrease that I project will end about 10 years from now at about 40, when population growth will reach zero. Beyond that point, there are broadly two possible futures.

In the most unlikely scenario, driven by a lack of energy the population will drop to zero or near to it. The other scenario involves a drop in population, accompanied by increase in ideality and power (likely a result of the drop, because more resources will be available to the survivors – which they won’t be able to effectively use because of the lack of people for processing and distribution).

Saturday, October 20, 2007

Power and the Peak

In an attempt to equate a typical population of people to an abstract, theoretical population, I endowed the abstract “people” with “intelligence” and “power” as tools for moving from an arbitrary starting position to an arbitrary preferred position (or “comfort zone”) with a range of allowed positions. Combining the possible values of intelligence and power into a single variable called “adjusted power” and recording the distances of the abstract people from their comfort zones over an arbitrary interval of time, I was able to define a mathematical function that related adjusted power to the average distance. I then identified a characteristic of the model population that was equivalent to “happiness” in a real population.

Applying this model to my consumption model, the point at which increasing world consumption corresponds to a peak in population occurs when the adjusted power reaches 50 percent, and the population declines to zero as adjusted power increases to 100 percent.

There are two possible scenarios for 50 percent adjusted power. In the first scenario, half of a population has an accurate sense of the direction they must “travel” to reach their comfort zone from their current “position,” while the other half thinks the direction is opposite from its true direction. In the second scenario, everyone knows the correct direction to go, but the maximum power (fraction of the required distance that can be traveled) is only 25 percent. In the first scenario, increasing adjusted power means making fewer people ignorant of the correct direction; while in the second scenario, it means increasing the average amount of power.

Thursday, October 18, 2007

Delaying the Peak

If current trends continue, we may have 13 years before the world’s population reaches a maximum of 7.1 billion people and then declines rapidly. This is due to an apparent correlation between consumption and population size: As ecological footprint increases, population peaks and then decreases. We can stretch the time until the population peaks by decreasing our consumption exponentially by two percent for 20 years; four percent for 30 years; five percent for 50 years; or six percent for 60 years (the latter resulting in 130 years to the population peak but a very low life expectancy of 31).

The amount of oil reserves remaining when the population peaks under business-as-usual conditions will be 33 years at the current production rate (it is presently 40 years). For each of the cases where we limit consumption the amount remaining at the end of the period will be 23-25 years of consumption at the current rate. These numbers imply that resource scarcity alone is not likely to be responsible for the decrease in population after the peak.

For my sample of countries, life expectancy seems to peak at about 75 years, corresponding to a peak in ecological footprint, marking what appears to be a condition of unstable equilibrium. Ideality, the average of life expectancy and happiness, likewise reaches a maximum of less than 80 and gradually decreases as happiness continues to increase. Could it be that there is a natural limit to humans, rather than our environments, that keeps us from living an ideal existence?

Wednesday, October 17, 2007

Buying Time

The least painful strategy for dealing with the depletion of a resource consists of simultaneously using less (allowing the current supply to last longer) while searching for alternative sources and replacements that will meet the same needs.

My projections indicate that if the world were to reduce its ecological footprint (corresponding closely to annual energy use) by five percent per year for 50 years, the Ideality index would drop to 40 (from 63) over that period; the IP index would fall to about 14 (from nearly 21); we would lose no population; and we would still have over 40 percent of our current oil reserves (part of over 80 percent of our fossil fuel reserves) to help find alternatives.

We would buy ourselves only 30 years if we reduced the ecological footprint by only four percent per year over that period. The Ideality index would drop to only 51, the IP index would drop to 18, and we would have practically the same amount of fuel reserves available.

Monday, October 15, 2007

IP Index Over Time

The connection between ideality and ecological footprint allows us to estimate how the IP index has changed historically and how it might in the future.

Based on my projections of ecological footprint, the IP index rose above a value of one by 1750, and doubled by 1820. It doubled again by 1900, and by the mid-1950s it had reached a value of eight. The index doubled to 16 by 1990 and is currently growing at close to its long-term rate of a little over one percent per year.

Because of its dependency on ecological footprint and the close correlation of footprint with energy production, it is very likely that the IP index will peak soon after oil production peaks. Based on my projections of energy production, the IP index will reach a maximum of about 23 to 24 by the mid-2020s, and then drop to zero between 2030 and 2100 (most likely by 2050).

Sunday, October 14, 2007

IP Index

There are at least two major problems with only 200 million people utilizing all of the planet’s renewable natural resources, one practical and the other ethical. The practical problem is that we do not have sufficient technology for so few people to do what it currently takes billions to do. The ethical problem is, quite simply, what to do with those other billions of people.

Since an ideal world, as I’ve defined it, depends on maximizing of the number of people living an ideal life for a maximum amount of time, our success at creating such a world can be measured by multiplying the Ideality index (a measure of personal longevity and satisfaction) by the size of the population, and we can try to constantly increase the result over time. To link this new index to required resources, the population can be measured in terms of the number of people sustainable by a specific amount of resources per year, and 200 million is an obvious choice. By this standard, I estimate that by the end of this year the world will have an “IP index” of 20.8 (the Ideality index divided by 100 to get a fraction, times the ratio of the current population to 200 million: 63/100 times 6.59 billion/200 million). Crudely, this number can be thought of as a multiple of the population that the Earth can support living an ideal life.

Saturday, October 13, 2007


A curve fit of per capita GDP to footprint yields values of about $250,000 per person for 100 years of life expectancy (7 times the current U.S. value) and $378,000 per person for 100 percent happiness (11 times the current U.S. value). The average of these numbers is the most likely actual value (based on the population-average of the sample countries under current conditions), or $314,000 (9 times the current U.S. value and 27 times the population-average of the sample countries). The average number of people who can be sustained by all available bio-productive land is 203 million people (168 million for life expectancy and 239 million for happiness), or two-thirds of the current U.S. population.

With a population of over 6.5 billion people, the world now has over 32 times the number that can live within the biosphere’s means under ideal conditions. Based on my sample of countries, the average of life expectancy and happiness (what I will in future refer to as the “ideality index,” measured in percent) is 67, or two-thirds of the maximum, with a footprint of over 2 hectares per person (according to the latest Living Planet Report by the WWF; in my sample, it is 2 for life expectancy and 5 for happiness, with an average of 3).

Friday, October 12, 2007

Bracketing Ideality Limits

Based on curve fits of happiness and life expectancy to global ecological footprint, total happiness would be achieved with 47 global hectares per person, and 100 years of life expectancy could be achieved with 67 global hectares per person. If all bio-productive land were used by people (none available for other species), Earth could sustain 239 million totally happy people or 168 million people living to 100 years old. If we left 10 percent of bio-productive land for other species (a purely arbitrary number at this point), then under ideal conditions the Earth could support 150 million people (half the current U.S. population).

Based on this and the previous analysis, we can say that under ideal conditions, a population between half and one times the current size of the U.S. could be sustained within the natural capacity of the planet. The GDP per capita would be between 13 and 27 times the U.S. value in 2000 (where the latter number corresponds to 67 global hectares per person).

Thursday, October 11, 2007

Limits of Ideality

To reach a life expectancy of 100, I project that per capita GDP would need to be about $330,000. To achieve maximum happiness, the minimum is about $430,000. The corresponding consumption would be around 280 percent and 330 percent of the maximum footprint in 2003, respectively.

The projected consumption values correspond to 33 and 40 global hectares of bio-productive land per person. There are a maximum of 11.2 billion global hectares available if we stay within natural limits, limiting the Earth’s population to between roughly 280 and 340 million people living at a naturally sustainable level. For larger populations, either lifestyle will suffer for a large numbers of people or we will need to secure more resources.

Wednesday, October 10, 2007

Value and GDP

Based on my sample of 43 countries, proportional increases in per capita GDP can be expected to equal or exceed increases in life expectancy up to about $2,000 (over this range, increases in resource use, measured by per capita ecological footprint, also either exceed or equal increases in per capita GDP). For happiness, this number is around $4,000.

Break-even for per capita GDP and life expectancy is about $27,000 and break-even for per capita GDP and happiness is about $24,000. Break-even for per capita GDP and resource use is about $6,000.

This data implies that economic productivity, as currently measured, translates into meaningful changes in people’s lives over a very limited range.

Monday, October 8, 2007

GDP and Ideality

Per capita Gross Domestic Product, a commonly used indicator of a country’s production in monetary units, seems to track logarithmically with both happiness and life expectancy (especially the latter), which represent an individual’s quality of life and longevity, respectively. If we were to multiply (normalized) happiness by life expectancy, the result would be a measure of conformance to an ideal world, and would likely also vary logarithmically with per capita GDP.

These facts suggest that the difference between the world economy and an “ideal” economy may be as simple as the difference between a line and a logarithmic curve, where one is a crude approximation of the other.

Sunday, October 7, 2007

Ideal Decision-Making

If we are confronted with two or more choices that will not decrease longevity or quality of life for anyone potentially affected by the decision, the choice that offers the greatest increase in these parameters is the proper one. As I’ve already indicated, any choice that decreases longevity or quality should be automatically discarded. If all choices result in a decrease, and the decision is unavoidable, then some means must be found to offset the decrease. Although it may be all but impossible to precisely determine the impact of an action, we should use our existing knowledge and understanding, aided by society’s enforcement of accurate and full disclosure of information, to compare the impacts of different actions.

Many would probably argue that following these rules is difficult, if not impractical. I fail to see how doing so would be any harder than considering supply and demand, two other variables which virtually everyone in the world uses to make routine economic decisions. Economic activity depends on imperfect knowledge of the present and future behavior of supply and demand. Supply is loosely related to longevity, and demand is loosely related to both quality of life and longevity; so one pair of variables may even be translatable into the other pair.

Friday, October 5, 2007

Minimum Information

Theoretically, my criteria for an ideal world can be characterized by two pairs of numbers. Each pair includes a measure of decision-related increase in longevity and a measure of decision-related increase in happiness (satisfaction); with one pair dealing with the individual most impacted by the decision, and the other pair dealing with the most people affected by the decision.

Practically, deriving such numbers (especially the pair dealing with the species) to any reasonable amount of accuracy for even the simplest kind of decision is all but impossible. Such a feat requires a comprehensive model of the world with current and comprehensive information about every part of it, not to mention computing power that far exceeds anything we are likely to ever acquire. Even approximations demand an unwieldy set of assumptions that may not even be testable.

Fortunately, since my criteria involve the maximizing of these four numbers, the minimum information we need to know when making a decision is whether or not all four numbers are negative. That is, we should reject any choice where one or more of the numbers is negative (indicating a reduction in longevity or satisfaction with life). For comparison, in our present system, buying decisions are typically made based on whether the individual buyer will be satisfied or not, representing the sign of only one of these numbers.

Thursday, October 4, 2007

Requirements for Information

If people making a buying decision were directly aware of the benefits and costs to other people as a result of supporting a product’s production and distribution, the purists’ idea of competition might be workable. Consumers could then consciously choose to help or hurt others, as well as themselves. In an ideal world, producers would be forced to provide the information needed to do this. Of course if the world was in fact “ideal,” any product that caused harm would be outlawed.

The complexity of cataloging and projecting the impact of a product’s impact over its lifetime (resource extraction, production, use, and disposal or reuse) is more than most producers could handle on their own. Therefore, the effort would need to be distributed among everyone in the society (world), and coordinated in the most efficient way possible by an entity I believe would at least superficially resemble a centralized government. This solution also follows from the fact that there are vast numbers of products and people that would need to be simultaneously considered.

I can’t help but wonder if many of the world’s problems might be traceable to a lack of information sharing among the people of the world, as well as a lack of due diligence in its collection, assurance of accuracy, and interpretation.

Wednesday, October 3, 2007

Product Information

As a type of product is used by many people, knowledge accumulates about its most important characteristics, how it can be used most effectively, and the consequences of its improper use. This information may be included with the product when it is sold. For example, food comes with nutritional information; and drugs come with information about proper use and warnings about potential side effects. For some classes of product, producers are legally required to provide this information, especially where physical harm could result from its misuse. In the best cases, consumers can gain just enough knowledge to determine how satisfied they will be with a product before they purchase it. All too often, however, almost no information is available at the point of purchase (where a consumer buys a product).

Because expectations for a product depend mostly on its intended use, this demand-related information will not necessarily address any larger impact beyond the individual consumer’s happiness and health. If minimizing the negative impact on other people, such as the use of slave labor and generation of pollution in the product’s manufacture, becomes important to enough consumers, the producer may consider changing production practices (thus “adding value” to the product) and then advertise the fact as “information” that will help drive up demand.

Economic purists would argue that the only legitimate way to make products support such goals is for the proponents of minimizing negative impact to convince enough people to value it as much as they do. “Public good” must thus compete with all other wants in an open market, and many people will likely get hurt (thus providing unavoidable information about this effect) before demand is significantly influenced.

Tuesday, October 2, 2007

Regulation and Information

Regulations have another distorting effect on the economy. Regulated businesses must pay for services (such as from lawyers and accountants) and products necessary to meet the regulations. Costs of all of the businesses’ products and services are likely to go up to compensate for loss in profits, and these increases are passed through the supply chains of businesses that use their products and services. Effectively, a supporting industry is created by and dependent on any given set of regulations, which arguably tends to reduce the efficiencies of everyone affected by them (by providing misleading indicators of supply and demand to the market through elevated prices).

I consider regulations to be “workarounds” (or quick fixes) to problems, rather than actual solutions. Like taxes that continue being levied after jump-starting demand for products based on new technology, they have limitations to their usefulness: They should just buy time until the required substantive changes to production practices are implemented.

In my view, a better role for government in the economy would be to ensure that consumers have complete, accurate, and useful information about what they purchase, above and beyond the vague rule-of-thumb indications of demand and supply that they get from price alone. This would in fact be one of the key roles of the “central processor” in my version of an ideal world, where people must be able to judge the impact of their actions on longevity and quality of life.

Monday, October 1, 2007

Government Control

While sales taxes can be used as a blunt instrument for reducing the consumption of a particular type of product, they will not necessarily stimulate higher consumption of a favored type. If the proceeds of a sales tax or rebate of other taxes (“tax deduction”) are used as capital for producers of a favored type of product, the chances may be better than those in a free market that consumption of the favored products will increase.

There are several problems with this approach to controlling consumption. One problem is that sales taxes, if continued after the jump-starting of supply, could end up providing inaccurate information to the market (about demand and supply). Another problem is that the approach could result in the concentration of power in the hands of a small number of people who may not be able to anticipate and deal with unexpected consequences, or may use the power to their personal benefit rather than society’s.

Just about every industry in the U.S. is regulated to some degree (another reason that the existence of a “free market” is fiction rather than fact). Practices deemed harmful to people are penalized by fines, imprisonment, revocation of licenses, and other measures. This approach depends on accurate definitions of what is “harmful,” in both the nature of products and the activities involved in their creation and marketing. It also depends on fair and reasonable enforcement of the regulations. It therefore has the potential of also falling prey to the incompetent or irresponsible exercise of concentrated power. In addition, since government has its own economic requirements (it must acquire and keep resources so it can operate), additional regulations will result in an increase in the government’s influence on (and potential distortion of) the entire economy through increased taxes, its main source of income.