The “Limits” of Economic Progress

by | Mar 11, 2012

A few weeks ago I caught a portion of a radio program in which a commentator argued that economic progress has limits.  He used a hamster as an example: For the first few weeks of his life, a hamster doubles in size each week. If he did this for a year, he would weight nine […]

A few weeks ago I caught a portion of a radio program in which a commentator argued that economic progress has limits.  He used a hamster as an example:

For the first few weeks of his life, a hamster doubles in size each week. If he did this for a year, he would weight nine billion pounds. Obviously, that would be absurd. The same holds true of an economy.  If an economy grows at the rate of seven percent each year, it would double every ten years. There simply aren’t enough resources to produce such growth.

For as long as I can remember, doomsayers have been making similar predictions. For example, in the late eighteenth century and early nineteenth century, Thomas Malthus argued that economic production could not keep pace with population growth. More recently, in 1968 Paul Ehrlich predicted that widespread famine would occur in the 1970s and 1980s. Ehrlich argued that mankind would be unable to expand food production to feed the growing human population. Today, we hear dire predictions that we are running out of oil and must develop renewable energy sources.

These predictions have at several things in common: they never come true, they are accompanied with calls for increased government control of the economy and our lives, and they involve a gross evasion of both historical and philosophical facts. (Malthus might be excused on this last point, as he wrote at the beginning of the Industrial Revolution.)

In his book, The Population Bomb, Ehrlich suggested numerous measures to curtail population growth:

He suggests a tax scheme in which additional children would add to a family’s tax burden at increasing rates for more children, as well as luxury taxes on childcare goods. He suggests incentives for men who agree to permanent sterilization before they have two children, as well as a variety of other monetary incentives. He proposes a powerful Department of Population and Environment which “should be set up with the power to take whatever steps are necessary to establish a reasonable population size in the United States and to put an end to the steady deterioration of our environment.” The department should support research into population control, such as better contraceptives, mass sterilizing agents, and Prenatal sex discernment (because families often continue to have children until a male is born. Ehrlich suggested that if they could choose a male child this would reduce the birthrate). Legislation should be enacted guaranteeing the right to an abortion, and sex education should be expanded.

While Ehrlich’s suggestion for “a powerful Department of Population and Environment” has not come to fruition, the Environmental Protection Agency has almost unlimited powers regarding land use and development. Combined with the powers of the Food and Drug Administration (not to mention the various other federal agencies, such as the IRS) to dictate what we may and may not put into our bodies, the federal government has almost complete control over our lives. But that is a side issue.

The real issue is whether we are running out of resources. And that ultimately comes down to human ingenuity and production. In other words, to claim that we are running out of resources is to claim that human beings will quit discovering, quit innovating, and quit expanding production. As long as men are free, this will not occur.

Consider the fact that the universe is one vast natural resource. While mankind has yet to discover how to utilize many of these resources, there was a time that uses for oil was not known. While mankind has yet to discover how to mine the moon and transport those materials back to earth, there was a time when men did not know how to travel across the oceans.

But men did discover how to travel the oceans. Men did discover how to make us of oil and silicone, how to unleash the power of the atom, how to build skyscrapers and jets. Free men transformed the wilderness of North America into the world’s most powerful economic machine. They found uses for natural resources and discovered new resources.And those discoveries created economic growth and progress.

Mankind is not running out of resources. Mankind is running out of freedom. Governments around the world are controlling, restricting, and regulating the actions of individuals. Governments are preventing individuals from using the resources that are known, and government are preventing new resources from being discovered.

Those who truly care about economic progress or the depletion of resources should not be calling for more government intervention and controls. Instead, they should be calling for more freedom. When men are free, there are no limits to economic progress.

Brian Phillips is the founder of the Texas Institute for Property Rights. Brian has been defending property rights for nearly thirty years. He played a key role in defeating zoning in Houston, Texas, and in Hobbs, New Mexico. He is the author of three books: Individual Rights and Government Wrongs, The Innovator Versus the Collective, and Principles and Property Rights. Visit his website at texasipr.com.

The views expressed above represent those of the author and do not necessarily represent the views of the editors and publishers of Capitalism Magazine. Capitalism Magazine sometimes publishes articles we disagree with because we think the article provides information, or a contrasting point of view, that may be of value to our readers.

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