Energy and Economic Myths Author(s): Nicholas Georgescu-Roegen Source: Southern Economic Journal, Vol. 41, No. 3 (Jan., 1975), pp. 347-381 Published by: Southern Economic Association Stable URL: http://www.jstor.org/stable/1056148 . Accessed: 22/08/2013 10:10

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This content downloaded from 132.198.40.43 on Thu, 22 Aug 2013 10:10:43 AM All use subject to JSTOR Terms and Conditions January Volume41 1975 Number3

ENERGYAND ECONOMICMYTHS* NICHOLASGEORGESCU-ROEGEN VanderbiltUniversity

So you can now all go home and sleep peacefully in your beds tonight secure in the knowledge that in the sober and consideredopinion of the latest occupant of the second oldest Chair in Political Economy in this country, although life on this Earth is very far from perfect there is no reason to think that continued economic growth will make it any worse. Wilfred Beckerman

I. INTRODUCTION last hundredyears remainedstubbornly at- tachedto one the mechanistic There is an of truth in particularidea, appreciablegrain which dominatedthe orienta- one of remarksthat the epistemology Percy Bridgman's tion of the founders of the Neoclassical economic is the most profession opportunistic School. their own the of all. economists'attention has con- By proud admission, Indeed, ambition of these was to shiftedfrom one to greatest pioneers tinually problem another, build an economicscience after the model of the often not even re- problems being closely mechanics-in the words of W. lated. Searchall economic of the Stanley periodicals Jevons-as "themechanics and world before for of utility self- English-speaking 1950, interest" Like almost scholar and will find men- [48, 23]. every example, you hardly any and of the first half of the nine- tion of "economic It is curi- philosopher development." teenth were fascinated the ous, therefore,that economistshave over the century, they by spectacular successes of the science of * This paper represents the substance of a lec- mechanics in astronomyand accepted La- ture delivered on November 8, 1972, at Yale Uni- place's famous apotheosisof mechanics[53, versity, School of Forestry and Environmental Studies, within the series Limits to Growth: The 4] as the evangelof ultimatescientific knowl- EquilibriumState and Human Society, as well as on edge. They thus had some attenuatingcir- numerous other occasions elsewhere. During July cumstances,which cannot, however, be in- 1973 a version prepared for a planned volume of voked those who came after the the series was distributed as a working document by long to the members of the Commission on Natural mechanisticdogma had been banishedeven Resources and the Committee on Mineral Re- from physics[23, 69-122; 5]. sources and the Environment (National Research The withouta Council). The present version contains a few recent latter-dayeconomists, single amendments. second thought,have apparentlybeen happy 347

This content downloaded from 132.198.40.43 on Thu, 22 Aug 2013 10:10:43 AM All use subject to JSTOR Terms and Conditions 348 NICHOLASGEORGESCU-ROEGEN to developtheir discipline on the mechanistic Nothingillustrates better the basic episte- tracks laid out by their forefathers,fiercely mologyof standardeconomics than the usual fightingany suggestionthat economics may graph by which almost every introductory be conceived otherwise than as a sister manual portraysthe economic process as a science of mechanics.The appealof the posi- self-sustaining,circular flow between "pro- tion is obvious. At the back of the mind of duction" and "consumption."2But even almostevery standardeconomist there is the money does not circulate back and forth spectacular feat of Urbain Leverrier and withinthe economicprocess; for both bullion John Couch Adams, who discovered the and paper money ultimately become worn planet Neptune, not by searching the real out and theirstocks must be replenishedfrom firmament,but "at the tip of a pencil on a external sources [31]. The crucial point is piece of paper."What a splendiddream to that the economicprocess is not an isolated, be able to predictby some paper-and-pencil self-sustainingprocess. This process cannot operations alone where a particularstock go on withouta continuousexchange which will be on the firmamentof the Stock Ex- alters the environmentin a cumulativeway change Market tomorrow or, even better, and withoutbeing, in its turn, influencedby one year from now! these alterations.Classical economists, Mal- The consequenceof this indiscriminateat- thus in particular,insisted on the economic tachmentto the mechanisticdogma, whether relevanceof this fact. Yet, both standardand in an explicit or a tacit manner,is the view- Marxisteconomists chose to ignorethe prob- ing of the economicprocess as a mechanical lem of naturalresources completely, so com- analogueconsisting-as all mechanicalana- pletely that a distinguished and versatile logues do-of a principle of conservation economist recently confessed that he had (transformation)and a maximizationrule. just decidedthat he "oughtto find out what The economic science itself is thus reduced economictheory has to say" aboutthat prob- to a timelesskinematics. This approachhas lem [75, If]. led to a mushroomingof paper-and-pencil One fundamentalidea dominatedthe ori- exercisesand increasinglycomplicated econ- entationof both schools. A. C. Pigou stated ometric models which often serve only it most explicitly:"In a stationarystate fac- to conceal from view the most fundamental tors of productionare stocks, unchangingin economic issues. Everythingnow turns out amount,out of which emergesa continuous to be just a pendulummovement. One busi- flow, also unchangingin amount,of real in- ness "cycle" follows another. The pillar of come" [68, 19]. The same idea-that a con- equilibriumtheory is that, if events alter the stant flow can arise from an unchanging demand and supply propensities,the eco- structure-is at the basis of Marx'sdiagram nomic world always returnsto its previous of simple reproduction[61, II, ch. xx]. In conditionsas soon as these events fade out. the diagramof expanded reproduction[61, An inflation, a catastrophicdrought, or a II, ch. xxi], Marx actually anticipatedthe stock-exchangecrash leaves absolutely no modern models-such as that with which mark on the economy. Completereversibil- W. W. Leontief swept the professionoff its ity is the generalrule, just as in mechanics.1 feet-which ignore the problem of the pri- 'Some economists have insisted that, on the marysource of the flow even in the case of a contrary, irreversibilitycharacterizes the economic world [e.g., 60, 461, 808; 25], but the point, though I For a highly significantsample, see G. L. Bach, never denied, was simply shelved away. It is in Economics, 2d ed. Englewood Cliffs, N.J.: Prentice- vain that some now try to claim that standard Hall, 1957, p. 60; Paul A. Samuelson, Economics, equilibriumanalysis has always considerednegative 8th ed. New York: McGraw-Hill, 1970, p. 72; feedbacks [4, 334]. The only feedbacks in standard Robert L. Heilbroner, The Economic Problem, 3rd theory are those responsible for maintaining equi- ed. Englewood Cliffs, N.J.: Prentice-Hall, 1972, p. librium, not for evolutionary changes. 177.

This content downloaded from 132.198.40.43 on Thu, 22 Aug 2013 10:10:43 AM All use subject to JSTOR Terms and Conditions ENERGYAND ECONOMICMYTHS 349 growingeconomy. The only differenceis that is below man's dignityto accept the verdict Marx preachedovertly that nature offers us of a biological authoritysuch as J. B. S. everythinggratis, while standardeconomists Haldane that the most certain fate of man- merely went along with this tenet tacitly. kind is the same as that of any other species, Both schools of thought shared, therefore, namely, extinction. Only, we do not know the Pigouviannotion of a stationarystate in when and why it will come. It may be sooner which a materialflow emerges from an in- than the optimistsbelieve or muchlater than variable source. In this idea there lies the the pessimistsfear. Consequencesof the ac- germ of an economic myth which, as we cumulation of environmentaldeterioration shall see (SectionVIII), is now preachedby may bringit about;but some persistentvirus many concernedecologists and some awak- or a freakinfertility gene may also cause it. ened economists.The myth is that a station- The fact is that we know little about why ary world,a zero-growthpopulation, will put any species bowed out in the past, not even an end to the ecologicalconflict of mankind. why some seem to become extinct before Mankindwill no longerhave to worryabout our own eyes. If we can predict approxi- the scarcityof resourcesor aboutpollution-- mately how long a given dog will live and another miracle-programto bring the New also what will most probablyend its life, it Jerusaleminto the earthlylife of man. is only because we have had repeated oc- Myths have always occupied a prominent casions to observe a dog's life from birth to role in the life of man. To be sure, to act in death. The predicamentof the evolutionary accord with a myth is the distinctivechar- biologist is that he has never observed an- acteristic of man among all living beings. other human species being born, aging, and Many myths betray man's greatestfolly, his dying [29, 91; 32, 208-210]. However, a inner compulsionto believe that he is above species reachesthe end of its existence by a everythingelse in the actual universe and process analogous to the aging of any in- that his powers know no limits. In Genesis dividualorganism. And even thoughaging is man proclaimedthat he was made in the still surroundedby manymysteries [32, 205], image of God Himself. At one time, he held we know that the causes which bring about that the entire universerevolves aroundhis the end of a species work slowly, but per- petty abode-at another,that only the sun sistently and cumulatively, from the first does so. Once, man believed that he could momentof its birth.The point is that every- move things withoutconsuming any energy, one of us ages with each minute, nay, with which is the myth of perpetualmotion of the each blink, even though we are unable to firstkind--certainly, an essentiallyeconomic realizethe difference. myth. The myth of perpetualmotion of the It is utterlyinept to argue-as some econ- second kind, which is that we may use the omistsimplicitly do-that since mankindhas same energyover and over again,still lingers not met with any ecological difficultysince on in variousveiled forms. the age of Pericles, it will never meet with Another economic myth-that man will one (SectionVI). If we keep our eyes open, forever succeed in finding new sources of however, we will detect, as time goes by, energy and new ways of harnessingthem to some sufficientlyapparent symptoms which his benefit-is now propoundedby some sci- may help us arrive at some general idea of entists, but especiallyby economistsof both the probablecauses of aging and, possibly, standard and Marxist persuasions (Section of death. True,man's needs and the kinds of VI). Come what may, "we will [always] resourcesrequired for their satisfactionare think up something"[4, 338]. The idea is far more complex than those of any other that, if the individualman is mortal,at least species.In exchange,our knowledgeof these the humanspecies is immortal.Apparently, it factors and their interrelationsis, naturally,

This content downloaded from 132.198.40.43 on Thu, 22 Aug 2013 10:10:43 AM All use subject to JSTOR Terms and Conditions 350 NICHOLASGEORGESCU-ROEGEN more extensive. The upshot is that even a matter. This viewpoint ignores a most im- simpleanalysis of the energyaspects of man's portantissue: How can man do the moving? existence may help us reach at least a gen- For anyone who remains at the level of eral picture of the ecological problemsand mechanicalphenomena, every bit of matter arrive at a few, but relevant, conclusions. and every bit of mechanicalenergy which This, and nothingelse, is whatI have endeav- enter a processmust come out in exactlythe ored to do in this paper. same quantityand quality.Locomotion can- not altereither. II. MECHANICSVERSUS THERMODYNAMICS To equate the economic process with a mechanical No analysisof a materialprocess, whether analogueimplies, therefore,the in the naturalsciences or in economics,can myth that the economicprocess is a circular which cannot be sound withouta clear and comprehensive merry-go-round possiblyaffect the environmentof matterand in analyticalpicture of such a process.The pic- energy any ture must first of all includethe way. The obvious conclusionis that there is boundary-- no need for the environmentinto an abstractand void elementwhich separates bringing the of that the processfrom its "environment"-as well analyticalpicture process.4The old tenet of Sir William that keen stu- as the duration of the process. What the Petty, dent of humanaffairs who insisted process needs and what it does are then de- that labor is the fatherand naturethe scribed analyticallyby the complete time motherof wealth, has since been to the of schedule of all inputs and outputs, i.e., the long relegated status a museum precise moments at which each element in- piece [29, 96; 31, 280]. Even the volved crosses the boundaryfrom outside or accumulationof glaring proofs of the pre- from inside. But wherewe drawthe abstract ponderantrole playedby naturalresources in boundary,what durationwe consider, and mankind'shistory failed to impressstandard what qualitativespectrum we use for clas- economists. One may think of the Great of the first milleniumwhich was sifying the elements of the process depend Migration the ultimate on the particularpurpose of the student,and response to the exhaustionof the soil of Central Asia by and large on the sciencein point.3 following a long of Mechanicsdistinguishes only mass, speed, period persistent grazing. Remarkable and position,on whichit bases the conceptof civilizations-Maya is one example-crum- kinetic and potential energy. The result is bled away from historybecause their people that mechanicsreduces any processto loco- were unable to migrateor to counteractby motion and a change in the distributionof adequatetechnical progress the deterioration energy. The constancy of total mechanical of their environment.Above all, there is the energy (kinetic plus potential)and the con- indisputablefact that all strugglesbetween stancy of mass are the earliestprinciples of the GreatPowers have not turnedidly around conservationto be recognizedby science. A ideologiesor nationalprestige but aroundthe few carefuleconomists, such as Marshall[60, controlof naturalresources. They still do. 63], did observethat man can create neither Because mechanicsrecognizes no qualita- matternor energy.But in doing so, they ap- tive change but only change of place, any parently had in mind only the mechanical 4 If "land" appears as a variable in some stan- principlesof conservation,for they imme- dard production functions, it stands only for diatelyadded that man can neverthelesspro- Ricardian land, i.e., for mere space. The lack of duce utilities by moving and rearranging concern for the true nature of the economic process is also responsible for the inadequacy of the stan- SFor a detailed discussion of the analytical dard production function from other, equally representationof a process, see Georgescu-Roegen crucial, viewpoints. See Georgescu-Roegen [27; [32, ch. ix]. 30; 33].

This content downloaded from 132.198.40.43 on Thu, 22 Aug 2013 10:10:43 AM All use subject to JSTOR Terms and Conditions ENERGYAND ECONOMICMYTHS 351 mechanicalprocess may be reversed,just as we may be satisfiedwith the simpledefinition a pendulum,for instance, can. No laws of of entropyas an index of the amountof un- mechanicswould have been violated if the available energy in a given thermodynamic earth had been set in motion in the opposite system at a given momentof its evolution. direction.There is absolutelyno way for a Energy, regardlessof quality,7is subject spectatorto discover whether a movie of a to a strictconservation law, the First Law of purely mechanicalpendulum is projectedin Thermodynamics,which is formallyidentical the directionin which it was taken or in the to the conservation of mechanical energy reverse. But actual phenomenain all their mentionedearlier. And since work is one of aspectsdo not follow the storyof the famous the multipleforms of energy,this law exposes Mother Goose rhyme in which the brave the myth of perpetual motion of the first Duke of York kept marchinghis troops up kind. It does not, however, take account of the hill and down the hill without giving the distinction between available and un- battle. Actual phenomenamove in a definite available energy; by itself the law does not directionand involvequalitative change. This preclude the possibility that an amount of is the lesson of thermodynamics,a peculiar work should be transformed into heat and branch of physics, so peculiar that purists this heat reconverted into the initial amount prefernot to considerit a part of physicsbe- of work. The First Law of Thermodynamics cause of its anthropomorphictexture. Even thus allows any process to take place both thoughit is hardto see how the basic texture forwardand backward,so that everythingis of any science could be otherwisethan an- againjust as it was at first,with no trace left thropomorphic,the case of thermodynamics by the happening.With only that law we are is unique. still in mechanics,not in the domainof actual Thermodynamicsgrew out of a memoir phenomena,which certainly includes the eco- by a French engineer,Nicolas Sadi Carnot, nomic process. on the efficiency of heat engines (1824). The irreducibleopposition between me- Among the first facts it brought to light is chanics and thermodynamicsstems from the that man can use only a particularform of SecondLaw, the EntropyLaw. The oldest of energy.Energy thus came to be dividedinto its multiple formulationsis also the most availableor free energy,which can be trans- transparentfor the nonspecialist:"Heat flows formed into work, and unavailable or bound by itself only from the hotter to the colder energy, which cannot be so transformed.5 body, never in reverse."A more involved Clearly, the division of energy accordingto but equivalentformulation is thatthe entropy this criterionis an anthropomorphicdistinc- of a closed system continuously (and ir- tion like no other in science. revocably)increases toward a maximum;i.e., The distinctionis related to an- closely result that some physicists may go wrong on it, too. other concept specific to thermodynamics, See Journal of Economic Literature, X (December namely, to entropy. This concept is so in- 1972), p. 1268. volved that one that "it is 7 Let us also note that even energy does not lend specialistjudged itself to a simple, formal definition. The familiar not easily understood even by physicists" one, that energy is the capacity of a system to per- [40, 37].6 But for our immediate purpose form work, clashes with the definition of unavail- able energy. We must then explain that all energy ' The technical definition of available (unavail- can in principle be transformedinto work provided able) energy does not coincide with that of free that the correspondingsystem is brought in contact (bound) energy. But the difference is such that we with another which is at the absolute zero of it in the discussion. This has may' safely ignore present temperature. explanation only the value This judgment is vindicated by the discussion of a pure extrapolation because, according to the of the Entropy Law in [44, 17]. Even the familiar Third Law of Thermodynamics, this temperature notion of heat raises some delicate issues, with the can never be reached.

This content downloaded from 132.198.40.43 on Thu, 22 Aug 2013 10:10:43 AM All use subject to JSTOR Terms and Conditions 352 NICHOLASGEORGESCU-ROEGEN the available energy is continuouslytrans- cording to all the evidence, our immediate formed into unavailableenergy until it dis- environment,the solar system, tends toward appearscompletely.8 a thermodynamicdeath," at least as far as In broad lines, the story is relativelysim- life-bearingstructures are concerned. All kinds are trans- ple: of energy gradually III.THE ENTROPY LAW AND ECONOMICS formed into heat and heat becomes so dis- no sipatedin the end that mancan no longeruse Perhaps other law occupies a position in science as as that of the it. Indeed, a point that goes back to Carnot singular Entropy Law. It is the law is that no steam engine can providework if only natural which recog- nizes that even the materialuniverse is sub- the same temperature,however high, prevails in the boilerand the cooler.9To be available, ject to an irreversiblequalitative change, to an This fact led some energymust be distributedunevenly; energy evolutionaryprocess.12 naturalscientists and to that is completely dissipated is no longer philosophers suspect available.The classicalillustration is the im- an affinity between that law and life phe- nomena. few would that the mense heat dissipatedinto the water of the By now, deny of life is not seas, which no ship can use. Althoughships economy any process governed, the laws of but the sail on top of it, they need availableenergy, by mechanics, by Entropy Law The as we the kinetic energy concentratedin the wind [32, xiii, 191-194]. point, shall now is in the case or the chemicaland nuclearenergy concen- see, most transparent of the economic tratedin some fuel. We may see why entropy process. Economistshave came to be regardedalso as an index of dis- occasionallymaintained since some scientists into eco- order (of dissipation)not only of energybut that, trespass nomicswithout muchabout the sub- also of matterand why the EntropyLaw in knowing are in about its present form states that matter, too, is ject, they, too, justified talking subjectto an irrevocabledissipation. Accord- science, notwithstandingtheir ignorance in thatdomain ingly, the ultimatefate of the universeis not [4, 328f]. The thoughtreflects an the Heat Death (as it was believed at first) error, which unfortunatelyis general with economists.But whateverthe economic ex- but a much grimmer state--Chaos. No of other doubt, the thought is intellectuallyunsatis- pertise scientists,economists could not fare well factory.'xBut what interestsus is that, ac- continuously in their own field withoutsome solid understandingof the En- 8 A system is closed if it exchanges no matter and Law and its As I no energy with its "environment."Clearly, in such tropy consequences.a3 a system the amount of matter-energyis constant. argued some years ago, thermodynamicsis However, the constancy of this amount alone does at bottom a physics of economic value-as not warrant the increase of entropy. Entropy may Carnot set it the En- evenS decreaseif there is exchange. unwittingly going-and There is no truth, therefore, in Holdren's idea I To preclude some erring, we should emphasize [44, 17] that temperaturemeasures "the usefulness" the point that a reversal of this trend would be just of heat. The most we can say is that the difference as bad for the of life on earth. ' preservation of temperatureis a rough index of the usefulness of Rudolf Clausius coined "entropy" from a the hotter heat. Greek word meaning "transformation," "evolu- 10 One alternative, supported by statistical tion." See [32, 130]. 1 thermodynamics (Section VI), is that entropy may As we shall see later on, some highly interest- decrease in some parts of the universe so that the ing examples are provided by Harry G. Johnson universe both ages and rejuvenates. But no sub- [49] and, in an unceremonious, assertive manner, stantial evidence exists for this possibility. Another by Robert A. Solo [73]. As for Robert M. Solow, hypothesis, set forth by a group of British astrono- who at first also refused to swerve a hair from the mers, is that the universe is an everlasting steady standard position [74], he recently found it oppor- state in which individual galaxies are born and tune to concede that "it takes economics and the die continuously. But facts do not fit this hypothe- law of entropy" to deal with the problem of sis either. The issue of the true nature of the resources [75, 11]. But at bottom, he still remained universe is far from settled [32, 201f, 210]. attached to his old creed.

This content downloaded from 132.198.40.43 on Thu, 22 Aug 2013 10:10:43 AM All use subject to JSTOR Terms and Conditions ENERGYAND ECONOMICMYTHS 353 tropy Law is the most economicin natureof not predictquantitatively. It does not specify all naturallaws [29, 92-94; 32, 276-283]. how great the increaseshould be at a future The economic process, like any other life moment or what particularentropic pattern process, is irreversible(and irrevocablyso); will result. Because of this fact, there is an hence, it cannot be explainedin mechanical entropicindeterminateness in the real world terms alone. It is thermodynamics,through which allows not only for life to acquirean the Entropy Law, that recognizesthe quali- endless spectrumof forms but also for most tative distinction which economists should actions of a living organismto enjoy a cer- have made from the outset between the in- tain amount of freedom [32, 12]. Without puts of valuableresources (low entropy)and this freedom,we wouldnot be able to choose the final outputs of valueless waste (high between eating beans or meat, between eat- entropy). The paradox suggested by this ing now or later. Nor could we aspireto im- thought,namely, that all the economicproc- plementeconomic plans (at any level) of our ess does is to transformvaluable matter and own choosing. energy into waste, is easily and instructively It is also because of the entropicindeter- resolved.It compelsus to recognizethat the minatenessthat life does matter in the en- real output of the economic process (or of tropic process. The point is no mystical vi- any life process, for that matter)is not the talism, but a matter of brute facts. Some materialflow of waste,but the still mysterious organismsslow down the entropic degrada- immaterialflux of the enjoyment of life.14 tion. Green plants store part of the solar Without recognizingthis fact we cannot be radiationwhich in their absence would im- in the domainof life phenomena. mediatelygo into dissipatedheat, into high The presentlaws of physicsand chemistry entropy. That is why we can burn now the do not explain life completely. But the solar energysaved from degradationmillions thought that life may violate some natural of years ago in the form of coal or a few law has no place in science. Nevertheless,as years ago in the form of a tree. All other has long been observed-and more recently organisms, on the contrary, speed up the in an admirableexposition by Erwin Schri6- marchof entropy.Man occupies the highest dinger [71, 69-72]-life seems to evade the position on this scale, and this is all that en- entropic degradationto which inert matter vironmentalissues are about. is subject.The truthis that any living organ- Most importantfor the student of eco- ism simplystrives at all times to compensate nomics is the point that the EntropyLaw is for its own continuousentropic degradation the taprootof economicscarcity. Were it not by suckinglow entropy(negentropy) and ex- for this law, we could use the energy of a pelling high entropy.Clearly, this phenome- piece of coal over and over again, by trans- non is not precludedby the Entropy Law, formingit into heat, the heat into work, and which requiresonly that the entropy of the the work back into heat. Also, engines, entire system (the environmentand the or- homes, and even living organisms (if they ganism) should increase. Everything is in could exist at all) would never wear out. order as long as the entropyof the environ- There would be no economic differencebe- ment increases by more than the compen- tween material goods and Ricardian land. sated entropyof the organism. In such an imaginary, purely mechanical Equallyimportant is the fact that the En- world, there would be no true scarcity of tropy Law is the only naturallaw that does energy and materials.A populationas large " as the space of our globe would allow could It seems idle therefore to ask-as Boulding [8, 10] does-whether well-being is a flow or a live indeed forever. An increase in the real stock. incomeper capitacould be supportedin part

This content downloaded from 132.198.40.43 on Thu, 22 Aug 2013 10:10:43 AM All use subject to JSTOR Terms and Conditions 354 NICHOLASGEORGESCU-ROEGEN by a greater velocity of use (just as in the less of the place and form in which it is case of money circulation)and in part by found.If availableenergy is to have any value additionalmining. But there would be no for mankind,it mustalso be accessible.Solar reason for any real struggle,whether intra- energy and its by-productsare accessibleto speciesor inter-species,to arise. us with practicallyno effort,no consumption Economistshave been insistingthat "there of additionalavailable energy. In all other is no free lunch," by which they mean that cases, we have to spend some work and the price of anythingmust be equal to the materialsin orderto tap a store of available cost; otherwise,one would get somethingfor energy. The point is that even though we nothing. To believe that this equality also may land on Mars and find there some gas prevailsin terms of entropyconstitutes one deposits, that available energy will not be of the most dangerouseconomic myths. In accessibleto us if it will take more than the the context of entropy, every action, of man equivalentenergy of a cubic foot of gas ac- or of an organism, nay, any process in nature, cessibleon earthto bringa cubic foot of gas must result in a deficit for the entire system. from that planet. There certainly are oil Not only does the entropy of the environ- shales from which we could extractone ton ment increase by an additionalamount for of oil only by using more than one ton of oil. every gallon of gasoline in your tank, but The oil in such a shale would still represent also a substantialpart of the free energycon- available,but not accessible,energy. We have tained in that gasoline, instead of driving been remindedad nauseamthat the real re- your car, will turndirectly into an additional serves of fossil fuel are certainlygreater than increase of entropy. As long as there are those knownor estimated[e.g. 58, 331]. But abundant,easily accessibleresources around, it is equallycertain that a substantialpart of we might not really care how large this ad- the real reservesdoes not constituteaccessi- ditional loss is. Also, when we produce a ble energy. copper sheet from some copper ore we de- The distinctionregards efficiency in terms crease the entropy(the disorder)of the ore, of energy, not in terms of economics. Eco- but only at the cost of a much greaterin- nomic efficiencyimplies energeticefficiency, crease of the entropyin the rest of the uni- but the converseis not true. The use of gas, verse. If there were not this entropicdeficit, for example, is energeticallymore efficient we would be able to convertwork into heat, than the use of electricity, but electricity and, by reversingthe process, to recuperate happensto be cheaperin manyinstances [79, the entireinitial amountof work-as in the 152]. Also, even though we can make gas imaginaryworld of the precedingparagraph. from coal, it is cheaperto extract gas from In such a world, standardeconomics would naturaldeposits. Should the naturalresources reignsupreme precisely because the Entropy of gas becomeexhausted before those of coal, Law would not work. we will certainlyresort to the methodthat is now economicallyinefficient. The same idea IV. ACCESSIBLEENERGY AND ACCESSIBLEMATTER shouldbe bornein mindwhen discussingthe As we have seen, the distinctionbetween futureof directuses of solar radiation. availableand unavailableenergy (generalized Economists, however, insist that "re- by that betweenlow and high entropy)was sources are properlymeasured in economic, introducedin orderthat thermodynamics may not physical,terms" [51, 663; also 3, 247]. take into accountthe fact that only one par- The advicereflects one of the most enduring ticular state of energy can be used by man. myths of the profession (shared also by But the distinction does not mean that man others). It is the myth that the price mecha- can actually use any available energy regard- nism can offset any shortages, whether of

This content downloaded from 132.198.40.43 on Thu, 22 Aug 2013 10:10:43 AM All use subject to JSTOR Terms and Conditions ENERGYAND ECONOMICMYTHS 355 land, energy or materials.1,This myth will the peaceful use of thermonuclearenergy. be duly examinedlater on, but here we need The fusionof deuteriumrequires the fantastic only emphasizethe point that from the point temperatureof 0.2 billion?F, one order of of view of the longrunit is only efficiencyin magnitudehotter than the sun'sinterior. The terms of energy that counts in establishing difficultyconcerns the materialcontainer for accessibility. To be sure, actual efficiency that reaction.As has been explainedin lay- dependsat any one time on the state of the man's terms, the solution now sought is arts. But, as we know from Carnot,in each similar to holding water inside a mesh of particular situation there is a theoretical rubberbands. In this connectionwe may re- limit independentof the state of the arts, call that the chemical energy of dynamite which can never be attainedin actuality.In and gunpowder,although in use for a long effect, we generallyremain far below it. time, cannot be controlledso as to drive a Accessibility,as here defined,bears on the turbineor a motor. Perhapsthe use of ther- fact that althoughmankind's spaceship floats monuclearenergy will also remainconfined within a fantastic store of availableenergy, to a "bomb."16 Be this as it may, with or only an infinitesimalpart of this store is po- withoutthermonuclear energy, the amountof tentially accessible to man. For even if we accessibleenergetic low entropyis finite(Sec- wereto travelin spacewith the greatestspeed, tion IV). that of light, we would still be confinedto a Similarconsiderations lead to the conclu- speck of cosmos. A journeyjust to scout the sion that the amount of accessible material nearestsun outsidethe solar system for pos- low entropy is finite, too. But although in sible, yet uncertain,earth-like satellites would both cases only the amount of low entropy take nine years!If we have learnedanything matters,it is importantthat the two accounts from the landingon the moon, it is that there be kept separate in any discussion of the is no promiseof resourcesin interplanetary, environmentalproblem. As we all know, let alone intersidereal,travel. availableenergy and orderedmaterial struc- Still narrowerlimits to the accessibleen- tures fulfill two distinct roles in mankind's ergy are set by our own biological nature, life. However,this anthropomorphicdistinc- which is such that we cannot surviveat too tion would not be compellingby itself. high or too low a temperatureor when ex- There is, first, the physical fact that, de- posed to some radiations.It is for this reason spite the Einstein equivalenceof mass and that the mining of nuclear fuel and its use energy,there is no reason to believe that we a scale has raisedissues which now on large can convertenergy into matterexcept at the divide as well as authoritieson the laymen atomic scale in a laboratoryand only for There are also limits subject (Section IX). some special elements.17 We cannotproduce set some obstacles. The by purely physical a copper sheet, for example, from sun cannot be mined even a energy possibly by alone. All the copperin that sheet must exist robot. From the sun's immense en- radiating as copper (in pure form or in some chemical ergy, only the small amount which reaches the earth counts in the main 16 The technical difficultiesat the present moment (Section IX). are surveyed in [63]. On the other hand, we should Nor can we harnessthe immense energy of remember that in 1933 Ernest Rutherford greatly the terrestrialthunders. Unique physicalob- doubted that atomic energy could be controlled [82, stacles also stand in the of 27]. hopelessly way "The point is that even the formation of an " The evidence is ample [3, 240f; 4, 337f; 49; atom of carbon from three atoms of helium, for 51, 663, 665; 74, 46f; 80; 69, 9f, 14f]. The appeal example, requires such a sharp timing that its prob- of the myth is seen in that even many on the other ability is astronomically small, and hence the event side of the fence share it [58; 62, 65; 6, 10, 12; may occur on a large scale only within astronomi- and Frank Notestein, quoted in 62, 130]. cally huge masses.

This content downloaded from 132.198.40.43 on Thu, 22 Aug 2013 10:10:43 AM All use subject to JSTOR Terms and Conditions 356 NICHOLASGEORGESCU-ROEGEN compound)beforehand. Therefore, the state- the mode in which they participatein the ment that "energyis convertibleinto most of natural and man-conductedprocesses, are the other requirementsof life" [83, 412] is, highly dissipative. Recycling, in this case, in this unqualifiedform, apt to mislead.Sec- can hardlyhelp. The situationis particularly ond, no materialmacrostructure (whether a distressingfor those elements which, in ad- nail or a jet) whose entropy is lower than dition, are found in very small supply in the that of its surroundingsmay last forever in environment.Phosphorus, a highly critical its originalform. Even the singularorganiza- elementin biologicalprocesses, seems to be- tions characterizedby the tendencyto evade long to this category.So does helium,another the entropic decay-the life-bearingstruc- element with a strictlyspecific role [17, 81; tures-cannot so last. The artifacts which 38]. now are an essentialpart of our mode of life An importantpoint-apparently ignored have therefore to be renewed continuously by economists [49, 8; 69, 16, 42]-is that from some sources. The final point is that recyclingcannot be complete.20Even though the earth is a thermodynamicsystem open we can pick up all the pearls from the floor only with respectto energy. The amountof and reconstitutea brokennecklace, no actual meteorite matter, though not negligible, processcan possiblyreassemble all the mole- comes alreadydissipated. cules of a coin afterit has been worn out. The result is that we can count only on This impossibilityis not a straightforward the mineral resources,which, however, are consequenceof the EntropyLaw, as Solow both irreplaceableand exhaustible.Many of believes [75, 2]. Nor is it quite exact to say, a particularkind have been exhaustedin one with Boulding [8, 7], that "there is, fortu- country after another [56, 120f].18At pres- nately, no law of increasing material en- ent, important minerals--lead, tin, zinc, tropy." The Entropy Law does not distin- mercury,precious metals-are scarce over guish between matter and energy. This law the entire world [17, 72-77; 56]. The wide- does not exclude (at least not in principle)a spread notion that the oceans constitutean complete unshufflingof a partial material almost inexhaustiblesource of mineralsand structure,provided that there is enoughfree may even become a link in a perpetual,natu- energyto do the job. And if we have enough ral recyclingsystem [3, 239; 69, 7f] is de- energy,we could even separatethe cold mol- nouncedas merehyperbole by geologicalau- ecules of a glass of waterand assemblethem thorities[17, 85-87].19 into ice cubes. If, in practice,however, such The only way we can substituteenergy for operationsare impossible,it is only because material low entropy is through physico- they would require a practically infinite chemicalmanipulations. By using largerand time.21 larger amounts of available energy we can V. DISPOSABLEWASTE sift copperout from poorerand poorerores, located and in the earth. But Since Malthusdid not see that waste also deeper deeper raises some economic it was nor- the energy cost of mining low-contentores problems, mal for the schools of economic thought increasesvery fast [56, 122f]. We can also which ignoredeven the input of naturalre- recycle "scrap."There are, however, some sources to pay no attentionto the output of elementswhich, because of their natureand I Data on are scarce and ' recycling inadequate; See the interesting story of the Mesabi Range a few are found in [12, 205; 16, 14]. For steel, see in 1 [14," If]. [14]. The widespreadnotion that the oceans may be 1 All this proves that, even though the Entropy turned into an immense source of food also is a Law may sound extremely simple, its correct inter- great delusion [13, 59f]. pretation requiresspecial care.

This content downloaded from 132.198.40.43 on Thu, 22 Aug 2013 10:10:43 AM All use subject to JSTOR Terms and Conditions ENERGYAND ECONOMICMYTHS 357 waste. As a result, waste, just like natural some space in which to remainisolated until resources,is not representedin any manner their reduction is completed. There are in the standard production function. The troublesomehygienic problems involved, but only mentionof pollutionwas the occasional the importantpoint is that such wastes do textbook example of the laundryenterprise not causepermanent, irreducible harm to our which suffersa loss becauseof a neighboring environment. smokestack.Economists must thereforehave Other wastes are disposable only in the felt some surprisewhen pollution started to sense that they may be convertedinto less strike everybodyin the face. Yet, there was noxious ones by certainactions on our part, nothing to be surprised about. Given the as when part of carbon monoxide is trans- entropic nature of the economic process, formedinto carbondioxide and heat through waste is an outputjust as unavoidableas the improved combustion.A great part of sul- input of natural resources [27, 514f, 519, phur dioxide pollution, another example, 523f]. "Biggerand better"motorcycles, auto- may be avoided through some special in- mobiles,jet planes, refrigerators,etc., neces- stallations. Still other wastes cannot be so sarily cause not only "bigger and better" reduced.A topical example is the fact that depletion of natural resources but also we cannotreduce the highlydangerous radio- "bigger and better" pollution [31; 32, 19f, activity of nuclear garbage [46, 233]. This 305f]. But by now, economistscan no longer activity diminishesby itself with time, but ignore the existenceof pollution.They even very slowly. In the case of plutonium-239, have suddenlydiscovered that they "actually the reductionto fifty percent takes 25,000 have something important to say to the years! However,the harm done by radioac- world,"namely, that if prices are right there tivity concentrationto life may very well be is no pollution [74, 49f; also 10, 12, 17; 49, irreparable. 11f; 80, 120f]22--whichis anotherfacet of Here, just as for the accumulationof any the economists'myth about prices (Sections waste, from rubbishof all kinds to heat, the IV and XI). difficultyis createdby the finitudeof acces- Wasteis a physicalphenomenon which is, sible space. Mankind is like a household generally,harmful to one or anotherform of which consumes the limited supply from a life, and, directly or indirectly,harmful to pantry and throws the inevitablewaste into humanlife. It constantlydeteriorates the en- a finitetrash can-the space aroundus. Even vironmentin many ways: chemically,as in ordinary rubbish is a menace; in ancient mercuryor acid pollution;nuclearly, as by times, when it could be removedonly with radioactivegarbage; physically, as in strip great difficulties,some glorious cities were mining or in the accumulationof carbon buriedunder accumulatedrubbish. We have dioxide in the atmosphere.There are a few bettermeans to removeit, but the continuous instancesin which a substantialpart of some productioncalls for another dumpingarea, waste element-carbon dioxideis the salient and another, and another... In the United States the annualamount of waste is almost example-is recycled by some "natural" of the environment.Most of the two tons per capitaand increasing[14, 11n.]. processes We should also bear in mind that for obnoxious cadavers, and every waste-garbage, barrelof shale oil we are saddledwith more excrement-is also reduced gradually by than one ton of ashes and to obtain five natural These wastes processes. only require ounces of uraniumwe must crush one cubic " In addition, Harry Johnson finally came to meter of rock. What to do even with these see that a complete representationof a production "neutral"residuals is a illus- process must necessarily include the output of problemvividly waste [49, 10]. trated by the consequencesof strip-mining.

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To send the residualsinto outer space would We apparentlybelieve that we just have not pay on a large and continuousscale.23 to do thingsdifferently in orderto dispose of The finitude of our space renders more pollution. The truth is that, like recycling, dangerouswastes which persist for a long disposalof pollutionis not costless in terms time and especially those which are com- of energy. Moreover, as the percentageof pletely irreducible.Typical of the last cate- pollution reduction increases, the cost in- gory is thermal pollution, the dangers of creaseseven more steeply than for recycling which are not fully appreciated.The addi- [62, 134f]. We must therefore watch our tionalheat into whichall energyof terrestrial step-as some have already warned us [6, origin is ultimatelytransformed when used 9]-so as not to substitute a greater but by man24is apt to upset the delicatethermo- distantpollution for a local one. In principle dynamicbalance of the globe in two ways. at least, a dead lake may certainly be re- First, the islands of heat created by power vitalizedby pumpingoxygen into it, as Harry plantsnot only disturb(as is well known)the Johnson suggests [49, 8f]. But it is as cer- local fauna and flora of rivers, lakes, and tain that the additionaloperations implied by even coastal seas, but they may also alter this pumping not only require enormous climatic patterns. One nuclear plant alone amountsof additionallow entropy but also may heat up the water in the Hudson River create additionalpollution. In practice, the by as much as 70F. Then again the sorry reclamationefforts undertaken for lands and plight of where to build the next plant, and streamsdegraded by strip-mininghave been the next, is a formidableproblem. Second, less than successful [14, 12]. Linear think- the additionalglobal heat at the site of the ing-to borrowa label used by Bormann[7, plant and at the place where power is used 706]-may be "in" nowadays,but precisely may increase the temperatureof the earth as economistswe oughtto abideby the truth to the point at which the icecaps would melt that what is true for one dead lake is not -an event of cataclysmic consequences. true for all dead lakes if their number in- Since the Entropy Law allows no way to creases beyond a certain limit. To suggest cool a continuouslyheated planet, thermal furtherthat man can constructat a cost a pollution could prove to be a more crucial new environmenttailored to his desiresis to obstacle to growththan the finitenessof ac- ignore completely that cost consists in es- cessible resources[79, 160].25 sence of low entropy,not of money, and is 23The cover photograph of Science, 12 April subjectto the limitationsimposed by natural 1968, and the photographsin National Geographic, laws.26 December 1970, are highly instructiveon this point. Often, our from the be- It may be true that-as Weinberg and Hammond argumentsspring [83, 415] argued-if we had to supply energy even lief in an industrialactivity free of pollution. for 20 billion people at an annual average of 600 It is a myth just as lulling as the belief in million BTU per capita, we would have to crush The sobertruth is rock only at twice the speed at which coal is now everlastingdurability. that, being mined. We would still face the problem of complex system in which a small disturbance may what to do with the crushed rock. have an enormous effect, the problem is not "an Solar all its con- old as Beckerman in -2 energy (in ramifications) scare," says dismissing it [4, stitutes the only (and a noteworthy) exception 340]. (Section IX). 2 Solo [73, 517] also asserts that because of 25 The continuous accumulation of carbon growth and technology, the present society could dioxide in the atmosphere has a greenhouse effect eliminate all pollution "(with the one possible which should aggravate the heating of the globe. exception of radiationrefuse)" at a bearable cost. It There are, however, other divergent effects from is only because of some perversity of our values the increase of scatteredparticles in the atmosphere: that we are not doing it. That we could devote more agriculturallyoriented changes of vegetation, inter- effort to pollution disposal is beyond doubt. But ference with the normal distributionof surface and to believe that with nonperverse values we could underground water, etc. [24; 57]. Even though defeat the natural laws reflects an indeed perverse experts cannot determine the resultant trend of this view of reality.

This content downloaded from 132.198.40.43 on Thu, 22 Aug 2013 10:10:43 AM All use subject to JSTOR Terms and Conditions ENERGYAND ECONOMICMYTHS 359 our effortsnotwithstanding, the accumulation by the worshipersof mechanics[32, ch. vi]. of pollution might under certain circum- The hopes raised by this interpretationwere stancesbeget the firstserious ecological crisis so sanguineat one time that P. W. Bridg- [62, 126f]. Whatwe experiencetoday is only man, an authorityon thermodynamics,felt a clearpremonition of a trendwhich may be- it necessaryto write an articlejust to expose come even more conspicuousin the distant the fallacy of the idea that one may fill one's future. pockets with money by "bootlegging en- tropy"[11]. VI. MYTHSABOUT MANKIND'S ENTROPIC PROBLEM Occasionallyand sotto voce some express Hardly anyone would nowadays openly the hope, once fostered by a scientific au- profess a belief in the immortalityof man- thoritysuch as John von Neumann,that man kind. Yet many of us prefer not to exclude will eventuallydiscover how to make energy this possibility;to this end, we endeavorto a free good, "justlike the unmeteredair" [3, impugn any factor that could limit man- 32]. Some envision a "catalyst"by which to kind's life. The most naturalrallying idea is decompose,for example, the sea water into that mankind'sentropic dowry is virtually oxygen and hydrogen, the combustion of inexhaustible,primarily because of man'sin- which will yield as much availableenergy as herent power to defeat the Entropy Law in we would want. But the analogy with the some way or another. small emberwhich sets a whole log on fire is To begin with, there is the simple argu- unavailing.The entropy of the log and the ment that, just as has happenedwith many oxygen used in the combustionis lower than naturallaws, the laws on whichthe finiteness that of the resulting ashes and smoke, of accessibleresources rests will be refuted whereasthe entropyof water is higherthan in turn. The difficultyof this historicalargu- that of the oxygen and hydrogen after de- ment is that historyproves with even greater composition.Therefore, the miraculouscata- force, first,that in a finite space there can be lyst also impliesentropy bootlegging.27 only a finite amount of low entropy and, Withthe notion,now propagatedfrom one second, that low entropy continuouslyand syndicated column to another, that the irrevocablydwindles away. The impossibility breeder reactor producesmore energy than of perpetual motion (of both kinds) is as it consumes, the fallacy of entropy boot- firmly anchored in history as the law of legging seems to have reached its greatest gravitation. currency even among the large circles of More sophisticated weapons have been literati,including economists. Unfortunately, forged by the statistical interpretationof the illusion feeds on misconceivedsales talk thermodynamicphenomena-an endeavorto by some nuclear experts who extol the re- reestablish the supremacy of mechanics actors which transformfertile but nonfis- proppedup this time by a sui generisnotion sionable materialinto fissionablefuel as the of probability.According to this interpreta- breedersthat "producemore fuel than they tion, the reversibilityof high into low en- consume" [81, 82]. The stark truth is that tropy is only a highly improbable,not a the breeder is in no way differentfrom a totally impossibleevent. And since the event plant which produceshammers with the aid is possible,we shouldbe able by an ingenious of some hammers.According to the deficit device to cause the event to happenas often principleof the Entropy Law (Section III), as we please, just as an adroit sharpermay even in breedingchickens a greater amount throw a "six" almost at will. The argument of low entropyis consumedthan is contained only brings to the surface the irreducible con- in the product.28 tradictions and fallacies packed into the 'A specific suggestion implying entropy boot- foundations of the statistical interpretation legging is Harry Johnson's: it envisages the possi-

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Apparentlyin defense of the standardvi- whichhas becomescarce, but also to increase sion of the economic process, economists the productivityof any kind of energy and have set forth themes of their own. We may material. Should we run out of some re- mention first the argumentthat "the notion sources, we will always think up something, of an absolutelimit to naturalresource avail- just as we have continuouslydone since the abilityis untenablewhen the definitionof re- time of Pericles [4, 332-334]. Nothing, sourceschanges drastically and unpredictably therefore,could ever stand in the way of an over time.... A limit may exist, but it can increasinglyhappier existence of the human be neitherdefined nor specifiedin economic species. One can hardly think of a more terms"[3, 7, 11]. We also read that there is blunt form of linear thinking.By the same no upper limit even for arableland because logic, no healthy young human should ever "arable is infinitely indefinable"[55, 22]. become afflicted with rheumatismor any The sophistryof these argumentsis flagrant. other old-age ailments;nor should he ever No one would deny that we cannot say ex- die. Dinosaurs,just before they disappeared actly how much coal, for example,is acces- from this very same planet,had behindthem sible. Estimates of natural resources have not less than one hundredand fifty million constantlybeen shown to be too low. Also, years of truly prosperous existence. (And the point that metals contained in the top they did not pollute environmentwith in- mile of the earth's crust may be a million dustrial waste!) But the logic to be truly times as much as the presentknown reserves savoredis Solo's [73, 516]. If entropicdeg- [4, 338; 58, 331] does not prove the inex- radation is to bring mankind to its knees haustibilityof resources, but, characteristi- sometimein the future,it should have done cally, it ignoresboth the issues of accessibil- so sometimeafter A.D. 1000. The old truth ity and disposability.29Whatever resources of Seigneur de La Palice has never been or arable land we may need at one time or turned around-and in such a delightful another, they will consist of accessible low form.80 entropy and accessible land. And since all In support of the same thesis, there also kinds togetherare in finite amount,no taxo- are argumentsdirectly pertaining to its sub- nomic switch can do away with that finite- stance. First, there is the assertionthat only ness. a few kinds of resourcesare "so resistantto The favoritethesis of standardand Marx- technologicaladvance as to be incapableof ist economists alike, however, is that the eventually yielding extractive products at power of technologyis withoutlimits [3; 4; constant or decliningcost" [3, 10].81 More able 10; 49; 51; 74; 69]. We will alwaysbe recently,some have come out with a specific for a resource not only to find a substitute law which, in a way, is the contraryof Mal- bility of reconstituting the stores of coal and oil thus' law concerningresources. The idea is And if he means "with enough ingenuity" [49, 8]. a with enough energy as well, why should one wish To recall the famous old French quatrain: to lose a great part of that energy through the "Seigneur de La Palice / fell in the battle for transformation? Pavia. / A quarter of an hour before his death / " How incredibly resilient is the myth of energy he was still alive." (My translation.) See Grand breeding is evidenced by the very recent state- Dictionnaire Universel du XIX-e Sidcle, Vol. X, p. Revelle that can 179. ment of Roger [70, 169] "farming 1 be thought of as a kind of breeder reactor in which Even some natural scientists, e.g., [1], have much more energy is produced than consumed." taken this position. Curiously, the historical fact Ignorance of the main laws governing energy is that some civilizations were unable "to think up widespreadindeed. something" is brushed aside with the remark that " Marxist economists also are part of this they were "relatively isolated" [3, 6]. But is not chorus. A Romanian review of [32], for example, mankind, too, a community completely isolated objected that we have barely scratched the surface from any external cultural diffusion and one, also, of the earth. which is unable to migrate?

This content downloaded from 132.198.40.43 on Thu, 22 Aug 2013 10:10:43 AM All use subject to JSTOR Terms and Conditions ENERGYAND ECONOMICMYTHS 361 that technology improves exponentially[4, speeded up throughuse cannot possibly go 236; 51, 664; 74, 45]. The superficialjustifi- on forever. cation is that one technologicaladvance in- In Solow's hands, substitution becomes duces another.This is true, only it does not the key factor that supports technological work cumulativelyas in populationgrowth. progresseven as resourcesbecome increas- And it is terriblywrong to argue,as Maddox ingly scarce. There will be, first, a substitu- does [59, 21], that to insist on the existence tion withinthe spectrumof consumergoods. of a limit to technologymeans to deny man's With prices reacting to increasingscarcity, power to influenceprogress. Even if technol- consumers will buy "fewer resource-inten- ogy continuesto progress,it will not neces- sive goods and more of other things" [74, sarily exceed any limit; an increasing se- 47].34More recently,he extendedthe same quence may have an upperlimit. In the case idea to production,too. We may, he argues, of technologythis limit is set by the theoreti- substitute "other factors for natural re- cal coefficientof efficiency(Section IV). If sources" [75, 11]. One must have a very progresswere indeed exponential,then the erroneousview of the economicprocess as a input i per unit of output would follow in whole not to see that there are no material time the law i = io (1 + r)-t and would con- factors other than natural resources. To stantly approach zero. Production would maintainfurther that "the world can, in ef- ultimatelybecome incorporealand the earth fect, get along withoutnatural resources" is a new Gardenof Eden. to ignore the differencebetween the actual Finally, there is the thesis which may be world and the Gardenof Eden. called the fallacy of endless substitution: More impressiveare the statistical data "Few components of the earth's crust, in- invoked in supportof some of the foregoing cludingfarm land, are so specific as to defy theses. The data adducedby Solow [74, 44f] economic replacement;... nature imposes show that in the United Statesbetween 1950 particularscarcities, not an inescapablegen- and 1970 the consumptionof a series of eral scarcity"[3, 10f].32 Bray's protest not- mineralelements per unit of GNP decreased withstanding[10, 8], this is "an economist's substantially.The exceptionswere attributed conjuringtrick." True, there are only a few to substitutionbut were expected to get in "vitamin" elements which play a totally line sooner or later. In strict logic, the data specific role such as phosphorusplays in do not prove that during the same period living organisms.Aluminum, on the other technology necessarily progressed to a hand,has replacediron and copperin many, greatereconomy of resources.The GNP may althoughnot in all uses.33However, substitu- increase more than any input of minerals tion within a finite stock of accessible low even if technologyremains the same, or even entropy whose irrevocable degradation is if it deteriorates.But we also know that dur- the same " Similar arguments can be found in [4, 338f; ing practically period, 1947-1967, 59, 102; 74, 45]. Interestingly, Kaysen [51, 661] the consumptionper capitaof basic materials and Solow [74, 43], while recognizing the finitude increasedin the United States. And in the of mankind's entropic dowry, pooh-pooh the fact one because it does not "lead to any very interesting world, duringonly decade, 1957-1967, conclusions." Economists, of all students, should the consumptionof steel per capita grew by know that the finite, not the infinite, poses ex- 44 percent [12, 198-200]. What mattersin tremely interesting questions. The present paper to offer proof of this. " The pearl on this is hopesI issue, however, supplied by Even in this most cited case, substitution has Maddox [59, 104]: "Just as prosperity in countries not been as successful in every direction as we now advanced has been accompanied by an actual have generally believed. Recently, it has been dis- decrease in the consumption of bread, so it is to be covered that aluminum electrical cables constitute expected that affluence will make societies less fire hazards. dependenton metals such as steel."

This content downloaded from 132.198.40.43 on Thu, 22 Aug 2013 10:10:43 AM All use subject to JSTOR Terms and Conditions 362 NICHOLASGEORGESCU-ROEGEN the end is not only the impactof technological gory. But the classificationserves analytical progresson the consumptionof resourcesper purposes. unit of GNP, but especially the increase in Now, economic history confirmsa rather the rate of resourcedepletion, which is a side elementary fact--the fact that the great effectof that progress. strides in technologicalprogress have gen- Still more impressive-as they have actu- erallybeen touchedoff by a discoveryof how ally provedto be-are the data used by Bar- to use a new kind of accessibleenergy. On nett and Morse to show that, from 1870 to the other hand, a great stridein technologi- 1957, the ratiosof labor and capitalcosts to cal progress cannot materializeunless the net output decreasedappreciably in agricul- correspondinginnovation is followed by a ture and mining,both criticalsectors as con- great mineralogicalexpansion. Even a sub- cernsdepletion of resources[3, 8f, 167-178]. stantialincrease in the efficiencyof the use of In spite of some arithmeticalincongruities,35 gasoline as fuel would pale in comparison the picture emergingfrom these data can- with a manifoldincrease of the known, rich not be repudiated.Only its interpretation oil fields. mustbe corrected. This sort of expansion is what has hap- For the environmentalproblem, it is es- pened duringthe last one hundredyears. We sential to understandthe typical forms in have struckoil and discoverednew coal and which technologicalprogress may occur. A gas depositsin a far greaterproportion than firstgroup includes the economy-innovations, we could use duringthe same period (note which achievea net economyof low entropy 38, below). Still more important,all mineral- -be it by a more completecombustion, by ogical discoverieshave includeda substantial decreasingfriction, by derivinga more inten- proportionof easilyaccessible resources. This sive light from gas or electricity,by substi- exceptionalbonanza by itself has sufficedto tuting materials costing less in energy for lower the real cost of bringingmineral re- others costing more, and so on. Under this sourcesin situ to the surface.Energy of min- headingwe shouldalso includethe discovery eral source thus becoming cheaper, substi- of how to use new kinds of accessiblelow tution-innovationshave caused the ratio of entropy. A second group consists of sub- labor to net output to decline. Capital also stitution-innovations,which simply substitute must have evolved towardforms which cost physico-chemicalenergy for human energy. less but use more energyto achievethe same A good illustrationis the innovationof gun- result.What has happenedduring this period powder, which did away with the catapult. is a modificationof the cost structure,the Suchinnovations generally enable us not only flow factorsbeing increased and the fundfac- to do things better but also (and especially) tors decreased.3"By examining, therefore, to do thingswhich could not be done before only the relativevariations of the fundfactors -to fly in airplanes,for example. Finally, during a period of exceptional mineral there are the spectrum-innovations,which bonanza, we cannot prove either that the bring into existence new consumer goods, unitary total cost will always follow a de- such as the hat, nylon stockings,etc. Most of cliningtrend or that the continuousprogress the innovationsof this group are at the same of technologyrenders accessible resources al- time substitution-innovations.In fact, most most inexhaustible-as Barnett and Morse innovationsbelong to more than one cate- claim [3, 239]. " The point refers to the addition of capital Little doubtis thus left aboutthe fact that (measuredin money terms) and labor (measuredin the theses examined in this section are workers employed) as well as the computation of net output (by subtraction) from physical gross 3 For these distinctions, see [27, 512-519; 30, output [3, 167f]. 4; 32, 223-225].

This content downloaded from 132.198.40.43 on Thu, 22 Aug 2013 10:10:43 AM All use subject to JSTOR Terms and Conditions ENERGYAND ECONOMICMYTHS 363 anchoredin a deep-lyingbelief in mankind's the termis used in multiplesenses. One con- immortality.Some of their defenders have fusion, againstwhich Joseph Schumpeterin- even urged us to have faith in the human sistentlyadmonished economists, is that be- species: such faith will triumph over all tween growth and development. There is limitations.37But neitherfaith nor assurance growthwhen only the productionper capita from some famous academicchair [4] could of current types of commoditiesincreases, alterthe fact that, accordingto the basic law which naturallyimplies a growingdepletion of thermodynamics,mankind's dowry is of equallyaccessible resources. Development finite.Even if one were inclinedto believe in means the introductionof any of the in- the possible refutationof these principlesin novationsdescribed in the foregoingsection. the future,one still must not act on that faith In the past, developmenthas ordinarilyin- now. We must take into accountthat evolu- duced growthand growthhas occurredonly tion does not consist of a linear repetition, in associationwith development.The result even thoughover short intervalsit may fool has been a peculiar dialecticalcombination us into the contrarybelief. also known as "growth,"but for which we A great deal of confusion about the en- may reserve another currentlabel, namely, vironmentalproblem prevails not only among "economicgrowth." Economists measure its economists generally (as evidenced by the level by the GNP per capita at constant numerous cases already cited), but also prices. among the highestintellectual circles simply Economicgrowth, it must be emphasized, becausethe sheer entropicnature of all hap- is a dynamic state, analogousto that of an penings is ignored or misunderstood.Sir automobile travelingon a curve. For such MacfarlaneBurnet, a Nobelite, in a special an automobileit is not possibleto be inside a lecture consideredit imperative"to prevent curve at one moment and outside it at the the progressivedestruction of the earth'sir- very next moment.The teachingsof standard replaceableresources" [quoted, 15, 1]. And a economics that economic growth depends prestigiousinstitution such as the United Na- only on the decisionat a point in time to con- tions, in its Declarationon the Human En- sume a largeror a smallerproportion of pro- vironment (Stockholm, 1972), repeatedly duction[4, 342f; 74, 41] are largelyoff base. urged everyone "to improve the environ- In spite of the superb mathematicalmodels ment." Both urgingsreflect the fallacy that with which Arrow-Debreu-Hahnhave de- man can reversethe marchof entropy. The lighted the profession and of the pragmati- truth, however unpleasant,is that the most cally oriented Leontief models, not all pro- we can do is to preventany unnecessaryde- duction factors (includinggoods in process) pletion of resources and any unnecessary can serve directlyas consumergoods. Only deteriorationof the environment,but without in a primitiveagricultural society, employing claimingthat we know the precise meaning no capital equipment,would it be true that of "unnecessary"in this context. the decisionto save more corn from the cur- rentharvest will increasethe next year'saver- VII.GROWTH: MYTHS, POLEMICS, AND FALLACIES age crop. Othereconomies are growingnow A greatdeal of confusionstains the heated because they grew yesterdayand will grow argumentsabout "growth"simply because tomorrowbecause they are growingtoday. 17 The roots of economic lie in See the dialogue between Preston Cloud and growth deep Roger Revelle quoted in [66, 416]. The same human nature. It is because of man's refrain runs through Maddox's complaint against Veblenian instincts of workmanship and idle those who point out mankind's limitations [59, one fosters vi, 138, 280]. In relation to Maddox's chapter, curiosity that innovation another "Man-madeMen," see [32, 348-359]. -which constitutes development. Given,

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also, man'scraving for comfortand gadgets, ferent when, at various times, the Conser- everyinnovation leads to growth.To be sure, vation Movement or some isolated literati, developmentis not an inevitable aspect of such as FairfieldOsborn and Rachel Carson, history;it dependson manyfactors as well as called attention to the ecological harm of on accidents,which explainswhy mankind's growth and the necessity of slowing down. past consistsmainly of long stretchesof quasi But a few years ago the environmentalist stationarystates and why the present effer- movement gained momentum around the vescentera is just a verysmall exception.38 problem of population-The Population On purelylogical grounds,however, there Bomb, as Paul Ehrlichepitomized it. Also, a is no necessaryassociation between develop- few unorthodox economists shifted to a ment and growth;conceivably, there could be physiocraticposition, albeit in greatlymodi- developmentwithout growth. Because of the fied forms,or made a try at blendingecology failure to observe the precedingdistinctions into economics[e.g., 8; 9; 19; 29; 32]. Some systematically,it was possible for environ- became concerned with good, instead of mentaliststo be accusedof being againstde- affluentlife [8; 65]. Moreover,a long series velopment.39Actually, the true environ- of incidentsproved to everybody'ssatisfac- mentalistposition must focus on the totalrate tion that pollution is not a plaything of of resourcedepletion (and the rate of the en- ecologists. Although depletion of resources suingpollution). It is only becausein the past has also been going on with increased in- economic growthhas resultednot only in a tensity at all times, it ordinarilyis a volume higher rate of depletion but even in an in- phenomenonbelow the earth'ssurface, where creaseof per capitaconsumption of resources no one can see it truly.Pollution, on the other thatthe argumentdrifted so as to turnaround hand,is a surfacephenomenon, the existence the economist's guidepost-the GNP per of which cannot possibly be ignored, much capita. As a result,the real issue came to be less denied. Those economistswho have re- buried under the sort of sophistries men- acted to these events have generallytried to tioned in the preceding section. For even harden further the position that economic though on purely logical grounds economic rationalityand the right kind of price mech- growthmight occur even with a decreasein anism can take care of all ecological prob- the rate of resource depletion,pure growth lems. cannot exceed a certain, albeit unknowable, But, curiously, the recent publicationof limit withoutan increasein that rate-unless The Limits to Growth[62], a reportfor the there is a substantialdecrease in population. Clubof Rome, causedan unusualcommotion It was natural for economists-who un- within the economics profession. In fact, flinchinglyhave hung on to theirmechanistic criticismof the reporthas come mainlyfrom framework-to remain completely indif- economists.A manifestoof similartenor, "A ' Blueprintfor Survival" has been rather Some who do not understandhow exceptional, [6], perhaps even abnormal, the present interlude is spared this glory, apparentlynot because it (Journal of Economic Literature, June 1972, pp. was endorsedby a numerousgroup of highly 459f), ignore the facts that coal mining began eight respected scholars. The reason for the dif- hundred years ago and that, incredible though it may seem, half of the total quantity ever mined ferenceis that the The Limits to Growthem- has been extracted in the last thirty years. Also, ployed analyticalmodels of the kind used in half of the total production of crude oil has been econometricsand simulationworks. From all obtained in the last ten years alone! [46, 166, 238; 56, also 32, one can judge,it was this fact that irked eco- "119f; 228] Solow also claims that to be against pollution nomiststo the point of resortingto director is to be against economic growth [74, 49]. However, veiled insults in their attack against the harmful pollution can be kept very low if appro- priate measures are taken and pure growth is slowed Trojan Horse. Even The Economist [55] dis- down. regardedproverbial British good form and in

This content downloaded from 132.198.40.43 on Thu, 22 Aug 2013 10:10:43 AM All use subject to JSTOR Terms and Conditions ENERGYAND ECONOMICMYTHS 365 the editorial "Limits to Misconception" dictedthe authorsof The Limitsfor assuming brandedthe reportas "thehighwater mark of (implicitly)that the sameproportionality pre- old-fashioned nonsense." Beckerman even vails for pollution--whichis an output, too! ignoredthe solemnityof an inaugurallecture [4, 399f; 52; 69, 47f]42 Fourthly, the price and assailedthe studyas "a brazen,impudent complex has not preventedeconomists from piece of nonsense [by] a team of whizz-kids developing and using models whose blue- fromMIT" [4, 327].40 printscontain no prices explicitly-the static Let us begin by recalling,first, that econo- and dynamic Leontief models, the Harrod- mists, especiallyduring the last thirty years, Domarmodel, the Solow model, to cite some have preachedright and left that only mathe- of the most famous ones. In spite of this, maticalmodels can serve the highestaims of some critics (includingSolow himself) have their science. With the advent of the com- decried the value of The Limits on the sole puter, the use of econometricmodels and groundthat its model does not involveprices simulationbecame a widespreadroutine. The [4, 337; 51, 665; 74, 46f; 69, 14]. fallacy of relyingon arithmomorphicmodels The final and most importantpoint con- to predictthe marchof historyhas been de- cerns the indisputablefact that, except for nounced occasionally with technical argu- some isolated voices in the last few years, ments.4'But all was in vain. Now, however, economists have always suffered from economistsfault The Limits to Growth for growthmania[65, Ch. 1]. Economicsystems that very sin and for seeking "an aura of as well as economicplans have alwaysbeen scientific authority"through the use of the evaluatedonly in relationto their ability to computer;some have gone so far as to im- sustaina greatrate of economicgrowth. Eco- pugn the use of mathematics[4, 331-334; nomicplans, withouta singleexception, have 10, 22f; 51, 660; 52; 69, 15-17]. Let us ob- been aimed at the highest possible rate of serve, secondly, that aggregationhas always economic growth. The very theory of eco- been regardedas a mutilatingyet inevitable nomic developmentis anchored solidly in procedure in macroeconomics,which thus exponential growth models. But when the greatlyignores structure. Nevertheless, econ- authorsof The Limitsalso used the assump- omists now denounce the report for using tion of exponential growth, the chorus of an aggregativemodel [4, 338f; 52; 69, 61f, economistscried "foul!" [4, 332f; 10, 13; 51, 74]. Thirdly, one common article of eco- 661; 52; 74, 42f; 69, 58f] This is all the more nomicfaith, known as the accelerationprinci- curious since some of the same critics con- ple, is that output is proportionalto capital comitantlymaintained that technologygrows stock. Yet some economistsagain have in- exponentially(Section VI). Some, while ad-

40 And later he asked, "How silly do you have to mitting at long last that economic growth be to be allowed to join [the Club of Rome]?" [4, cannot continue forever at the present rate, 339]. Kaysen [51] also is caustic in places. Solow that it could on at [75, 1] just says that, like everyone else, he was suggested, however, go "suckered into reading the Limits to Growth," some lower rates[74, 666]. while Johnson [49, 1] disqualifies intellectually all Going throughthis peculiarcriticism, one concerned ecologists right from the outset. Outside the the the economists' circle, John Maddox stands out by gets impressionthat critics from the himself for seeking to impress the reader by similar economicsprofession proceeded according to "arguments." the Latin adage--quod licet Jovi non licet '1See in particular, [26] and [28]; also [32, 339-341]. More recently, and from a differentview- bovi-what is permittedto Zeus is not per- point, W. Leontief also took up the issue in his mittedto a bovine.Be this as it may, standard PresidentialAddress to the AEA [54]. Symptomati- economics will recover with cally, the frank verdict of Ragnar Frisch in his only difficulty address to the First World Congress of the " Some of the foregoing objections were also Econometric Society (1965) still awaits publica- voiced from outside the economics profession [1; tion. 59, 284f].

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from the exposureof its own weaknessesby tion. The humanspecies, of all species,is not these effortsat self-defense. likely to go suddenlyinto a short coma. Its Outside these circles, the reporthas been end is not even in distantsight; and when it received with sufficient appreciation, cer- comes it will be after a very long series of tainly not with vituperation.43The most apt surreptitious,protracted crises. Yet, as Silk verdictis that despiteits imperfections,"it is pointed out [72], it would be madness to not frivolous."4 True, the presentationis ignore the study's general warnings about rather half-baked, betraying the rush for population growth, pollution, and resource early publicity [34]. But even some econo- depletion. Indeed, any of these factors may mists have recognizedits merit in drawing cause the world's economy to experience attention to the ramified consequences of some shortnessof breath. pollution [69, 58f]. The study has also Some critics have further belittled The broughtto the fore the importanceof dura- Limits for merely using an analyticalarma- tion in the actual course of events [62, 183] mentariumin order to emphasizean unin- -a point often emphasizedby naturalscien- terestingtautology, namely, that continuous tists [43, 144; 56, 131] but generallyover- exponentialgrowth is impossiblein a finite looked by economists[32, 273f]. We need a environment[4, 333f; 51, 661; 74, 42f; 69, time lead not only to reach a higherlevel of 55]. The indictmentis right, but only on economic growth but also to descend to a the surface; for this was one of those oc- lowerone. casions when the obvious had to be em- But the much publicizedconclusion-that phasized because it had been long ignored. at most one hundredyears separatemankind However, the greatestsin of the authorsof from an ecological catastrophe[62, 23 and The Limits is that they have concealed the passim]-lacks a scientificallysolid basis. most importantpart of the obviousby focus- There is hardly any room for quarreling ing their attentionexclusively on exponential about the general pattern of relations as- growth, as Malthus and almost every other sumed in the varioussimulations covered by environmentalisthas done. the report.However, the quantitativeforms of these relationshave not been submittedto VIII.THE STEADY STATE: A TOPICALMIRAGE any factual verification.Besides, by their Malthus, as we know, was criticizedpri- very rigidnature, the arithmomorphicmodels marily because he assumedthat population used are incapableof predictingthe evolu- and resourcesgrow accordingto some simple tionary changes these relations may suffer mathematicallaws. But this criticismdid not over time. The prediction,which soundslike touch the real error of Malthus (which has the famousscare that the world would come apparentlyremained unnoticed). This erroris to an end in A. D. 1000, is at odds with the implicitassumption that populationmay everythingwe know about biologicalevolu- grow beyond any limit both in numberand time that it does not too 43A notable exception is Maddox [59]. His provided grow berating review of "A Blueprint for Survival" rapidly.45An essentially similar error has ("The Case Against Hysteria," Nature, 14 January been committed by the authors of The 1972, pp. 63-65) drew numerous protests: Nature, Limits, the authorsof the nonmathemati- 21 January 1972, p. 179, 18 February 1972, pp. by 405f. But given the position of economists in the cal yet more articulate"Blueprint for Sur- controversy, it is understandable that Beckerman vival," as well as by several earlierwriters. [4, 341f] cannot conceive why natural scientists Because, like Malthus, were set exclu- have not assailed the report and why they seem they even to its thesis. J. a " accept 5 Joseph Spengler, recognized authority in Financial Times, 3 March 1972, quoted in [4, this broad domain, tells me that indeed he knows 337n]. Denis Gabor, a Nobelite, judged that of no one who may have made the observation. "whatever the details, the main conclusions are For some very penetrating discussions of Malthus incontrovertible"(quoted in [4, 342]). and of the present population pressure,see [76; 77].

This content downloaded from 132.198.40.43 on Thu, 22 Aug 2013 10:10:43 AM All use subject to JSTOR Terms and Conditions ENERGYAND ECONOMICMYTHS 367 sively on provingthe impossibilityof growth, value of n is the maximumduration of the they were easily deluded by a simple, now humanspecies [31, 12f; 32, 304]. widespread,but false syllogism: since ex- The earth also has a so-called carrying ponential growth in a finite world leads to capacity, which depends on a complex of disastersof all kinds,ecological salvation lies factors,including the size of s,.48 This capac- in the stationarystate [42; 47; 62, 156-184; ity sets a limit on any single Pi. But this 6, 3f, 8, 20].46H. Daly even claimsthat "the limit does not render the other limits, of L stationary state economy is, therefore, a and n, superfluous.It is thereforeinexact to necessity"[21, 5]. argue-as the Meadows group seems to do This vision of a blissful world in which [62, 91f]--that the stationarystate can go both population and capital stock remain on foreveras long as Pi does not exceed that constant,once expoundedwith his usualskill capacity. The proponents of salvation by John StuartMill [64, Bk. 4, Ch. 6], was throughthe stationarystate must admit that until recently in oblivion.47Because of the such a state can have only a finiteduration- spectacularrevival of this myth of ecological unless they are willingto join the "No Limit" salvation,it is well to point out its various Clubby maintainingthat S is inexhaustibleor logical and factual snags. The crucial error almost so-as the Meadows group does in consists in not seeing that not only growth, fact [62, 172]. Alternatively,they must ex- but also a zero-growthstate, nay, even a de- plain the puzzle of how a whole economy, cliningstate which does not convergetoward stationaryfor a long era, all of a sudden annihilation,cannot exist forever in a finite comes to an end. environment.The error perhapsstems from Apparently,the advocatesof the stationary some confusionbetween finite stock andfinite state equate it with an open thermodynamic flow rate,as the incongruousdimensionalities steady state. This state consists of an open of severalgraphs suggest [62, 62, 64f, 124ff; macrosystemwhich maintains its entropic 6, 6]. And contraryto what some advocates structure constant through material ex- of the stationarystate claim [21, 15], this changes with its "environment."As one state does not occupy a privilegedposition would immediatelyguess, the concept con- vis-a-visphysical laws. stitutes a highly useful tool for the study of To get to the core of the problem, let S biologicalorganisms. We must, however,ob- denote the actual amount of accessible re- serve that the concept rests on some special sourcesin the crust of the earth. Let Pj and conditions introduced by L. Onsager [50, si be the populationand the amount of de- 89-97]. Theseconditions are so delicate(they pleted resources per person in the year i. are called the principleof detailed balance) Let the "amountof total life," measuredin that in actualitythey can hold only "withina years of life, be defined by L = YPi, from deviation of a few percent" [50, 140]. For i = 0 to i = o0. S sets an upper limit for L this reason, a steady state may exist in fact throughthe abviousconstraint Pijs< S. For only in an approximatedmanner and over a althoughsj is a historicalvariable, it cannot finiteduration. This impossibilityof a macro- be zero or even negligible (unless mankind systemnot in a state of chaos to be perpetu- reverts sometime to a berry-pickingecon- ally durablemay one day be explicitlyrecog- omy). Therefore,Pi = 0 for i greater than nized by a new thermodynamiclaw just as some finite n, and Pj > 0 otherwise.That the impossibilityof perpetualmotion once 46The substance of the argument of The Limits 8 Obviously, any increase in s, will generally beyond that of Mill's is borrowed from Boulding result in a decrease of L and of n. Also, the carry- and Daly [8; 9; 20; 21]. ing capacity in be increased a " any year may by In International Encyclopedia of the Social greater use of terrestrial resources. These elemen- Sciences, for example, the point is mentioned only tary points should be retained for further use in passing. (Section X).

This content downloaded from 132.198.40.43 on Thu, 22 Aug 2013 10:10:43 AM All use subject to JSTOR Terms and Conditions 368 NICHOLASGEORGESCU-ROEGEN was. Specialists recognize that the present The usual argumentsadduced in favor of thermodynamiclaws do not sufficeto explain the stationarystate are, however, of a dif- all nonreversiblephenomena, including espe- ferent,more directnature. It is, for example, cially life processes. arguedthat in such a state thereis more time Independentlyof these snags there are for pollutionto be reducedby naturalproc- simple reasons against believing that man- esses and for technologyto adaptitself to the kind can live in a perpetualstationary state. decreaseof resourceaccessibility [62, 166]. The structureof such a state remains the It is plainly true that we could use much same throughout;it does not containin itself more efficiently today the coal we have the seed of the inexorabledeath of all open burnedin the past. The rub is that we might macrosystems.On the other hand, a world not have masteredthe presentefficient tech- with a stationarypopulation would, on the niquesif we had not burnedall that coal "in- contrary,be continuallyforced to changeits efficiently."The point that in a stationary technologyas well as its mode of life in re- state people will not have to work ad- sponse to the inevitabledecrease of resource ditionally to accumulatecapital (which in accessibility.Even if we beg the issue of how view of what I have said in the last para- capitalmay changequalitatively and still re- graphs is not quite accurate) is related to main constant, we would have to assume Mill's claim that people could devote more that the unpredictabledecrease in accessi- time to intellectualactivities. "The trampling, bility will be miraculouslycompensated by crushing, elbowing, and treading on each the right innovations at the right time. A other's heel" will cease [64, 754]. History, stationaryworld may for a while be inter- however,offers multiple examples-the Mid- locked with the changing environment dle Ages, for one-of quasi stationary through a system of balancing feedbacks societieswhere arts and scienceswere practi- analogousto those of a living organismdur- cally stagnant. In a stationary state, too, ing one phase of its life. But as Bormannre- people may be busy in the fields and shops minded us [7, 707], the miraclecannot last all day long. Whateverthe state,free time for forever;sooner or later the balancingsystem intellectualprogress depends on the intensity will collapse. At that time, the stationary of the pressureof populationon resources. state will enter a crisis, which will defeat its Therein lies the main weakness of Mill's allegedpurpose and nature. vision. Witness the fact that-as Daly ex- One must be cautioned against another plicitly admits [21, 6-8]-its writ offers no logical pitfall, that of invokingthe Prigogine basis for determiningeven in principle the principlein support of the stationarystate. optimum levels of population and capital. This principlestates that the minimumof the This brings to light the important,yet un- entropy produced by an Onsager type of noticed point, that the necessaryconclusion open thermodynamicsystem is reachedwhen realized that the system becomes steady [50, ch. xvi]. It the proper analytical description of a process must include both flows and funds [30; says nothingabout how thislast entropycom- 32, 219f, 228-234]. Entrepreneurs,as far as Bould- pares with that producedby other open sys- ing's idea is concerned, have at all times aimed tems.49 at minimizing the flow necessary to maintain their capital funds. If the present inflow from nature is 1 The point recalls Boulding's idea that the incommensurate with the safety of our species, it inflow from nature into the economic process, is only because the population is too large and part which he calls "throughput,"is "something to be of it enjoys excessive comfort. Economic decisions minimized rather than maximized" and that we will always forcibly involve both flows and stocks. should pass from an economy of flow to one of Is it not true that mankind's problem is to econo- stock [8, 9f; 9, 359f]. The idea is more striking mize S (a stock) for as large an amount of life than enlightening. True, economists suffer from a as possible, which implies to minimize st (a flow) flow-complex [29, 55, 88]; also, they have little for some "good life"? (Section XI).

This content downloaded from 132.198.40.43 on Thu, 22 Aug 2013 10:10:43 AM All use subject to JSTOR Terms and Conditions ENERGYAND ECONOMICMYTHS 369 of the argumentsin favorof that visionis that great part of the dronesby the bees is a na- the most desirablestate is not a stationary, tural,biological action, not a civil war. but a decliningone. The second change is man's addictionto Undoubtedly, the current growth must exosomatic instruments-a phenomenon cease, nay, be reversed.But anyonewho be- analogousto that of the flyingfish which be- lieves that he can draw a blueprintfor the came addicted to the atmosphere and ecological salvation of the human species mutatedinto birds forever. It is because of does not understandthe natureof evolution, this addiction that mankind'ssurvival pre- or even of history-which is that of a perma- sents a problementirely differentfrom that nent struggle in continuouslynovel forms, of all other species [31; 32, 302-305]. It is not that of a predictable, controllable neitheronly biologicalnor only economic.It physico-chemicalprocess, such as boiling an is bioeconomic.Its broadcontours depend on egg or launchinga rocketto the moon. the multipleasymmetries existing among the three sourcesof low entropywhich together IX. SOME BASICBIOECONOMICS50 constitutemankind's dowry-the free energy receivedfrom the on the one and Apart from a few insignificantexceptions, sun, hand, the free and the ordered material all species other than man use only endoso- energy structuresstored in the bowels of the matic instruments-as Alfred Lotka pro- earth, on the other. posed to call those instruments(legs, claws, The concernsthe fact that wings, etc.) which belong to the individual first asymmetry the terrestrial is a whereas organismby birth.Man alone came, in time, component stock, the solar one is a The differenceneeds to use a club, which does not belong to him flow. to be well understood Coal in situ by birth,but whichextended his endosomatic [32, 226f]. is a stock because we are free to use it all arm and increasedits power.At that point in or time, man's evolution transcendedthe bio- today (conceivably) over centuries.But at no time can we use of a futureflow logical limits to include also (and primarily) any part of solar radiation. the evolutionof exosomaticinstruments, i.e., Moreover,the flow rate of this radiationis our of instrumentsproduced by man but not be- wholly beyond control; it is determined longingto his That is why man can completely by cosmological body.5l the size of our now fly in the sky or swim underwater even conditions,including globe.52 One whateverit cannot though his body has no wings, no fins, and generation, may do, alterthe shareof solarradiation of future no gills. any Because of the of the The exosomatic evolution brought down generation. priority over the futureand the upon the humanspecies two fundamentaland present irrevocability of the is true irrevocablechanges. The firstis the irreduci- entropicdegradation, opposite ble social conflict which characterizesthe for the terrestrialshares. These shares are affected how muchof the terrestrial human species [29, 98-101; 32, 306-315, by dowry the have consumed. 348f]. Indeed, there are other species which past generations Second, since no is also live in society, but which are free from practical procedure such conflict.The reasonis that their "social available at human scale for transforming into matter accessible classes" correspondto some clear-cut bio- energy (Section IV), materiallow is far the most criti- logical divisions. The periodic killing of a entropy by cal elementfrom the bioeconomic ' I saw this term used for the first time in a viewpoint. letter from Jifi Zeman. "A fact greatly misunderstood:Ricardian land "The practice of slavery, in the past, and the has economic value for the same reason as a fisher- possible procurement, in the future, of organs for man's net. Ricardianland catches the most valuable transplant are phenomena akin to the exosomatic energy, roughly in proportion to its total size [27, evolution. 508; 32, 232].

This content downloaded from 132.198.40.43 on Thu, 22 Aug 2013 10:10:43 AM All use subject to JSTOR Terms and Conditions 370 NICHOLASGEORGESCU-ROEGEN

True, a piece of coal burned by our fore- Q. These reserves,therefore, could produce fathersis gone forever,just as is part of the only two weeks of sunlight on the globe.53 silver or iron, for instance, mined by them. If their depletioncontinues to increaseat the Yet future generationswill still have their current pace, these reserves may support inalienableshare of solar energy (which, as man's industrialactivity for just a few more we shall see next, is enormous).Hence, they decades. Even the reservesof uranium-235 will be able, at least, to use each year an will not last for a longerperiod if used in the amount of wood equivalent to the annual ordinaryreactors. Hopes are now set on the vegetable growth. For the silver and iron breeder reactor, which, with the aid of dissipatedby the earliergenerations there is uranium-235,may "extract"the energy of no similarcompensation. This is why in bio- the fertile but not fissionable elements, economics we must emphasize that every uranium-238and thorium-232. Some experts Cadillacor every Zim--let alone any instru- claimthat this sourceof energyis "essentially ment of war--means fewer plowsharesfor inexhaustible"[83, 412]. In the UnitedStates some future generations, and implicitly, alone, it is believed, there are large areas fewer futurehuman beings, too [31, 13; 32, covered with black shale and granitewhich 304]. contain 60 grams of natural uranium or Third,there is an astronomicaldifference thoriumper metric ton [46, 226f]. On this between the amount of the flow of solar basis, Weinbergand Hammond [83, 415f] energyand the size of the stock of terrestrial have come out with a grandplan. By strip- free energy.At the cost of a decreasein mass miningand crushingall these rocks,we could of 131 x 1012tons, the sun radiatesannually obtain enoughnuclear fuel for some 32,000 1014Q-one single Q being equal to breederreactors distributed in 4,000 offshore 1018BTU!Of this fantasticflow, only some parks and capableof supplyinga population 5,300 0 are interceptedat the limits of the of twenty billion for millions of years with earth's atmosphere,with roughly one half twice as much energyper capita as the cur- of that amountbeing reflected back into outer rent consumption rate in the USA. The space. At our own scale, however,even this grand plan is a typical example of linear amountis fantastic;for the total world con- thinking, according to which all that is sumptionof energycurrently amounts to no neededfor the existenceof a population,even more than 0.2 Q annually.From the solar "considerablylarger than twenty billion,"is energythat reachesthe groundlevel, photo- to increaseall suppliesproportionally.54 Not synthesis absorbsonly 1.2 Q. From water- that the authorsdeny that therealso are non- falls we could obtain at most 0.08 Q, but we technicalissues; only, they play them down are now using only one tenth of that po- with noticeablezeal [83, 417f]. The most im- tential. Think also of the additionalfact that portant issue, of whether a social organiza- the sun will continueto shine with practically tion compatiblewith the density of popu- the same intensity for another five billion lation and the nuclear manipulationat the ' years (beforebecoming a red giantwhich will The figures used in this section have been cal- raise the earth's temperatureto 1,000'F). culated from the data of Daniels [22] and Hubbert the human will not sur- [46]. Such data, especially those about reserves, Undoubtedly, species vary from author to author but not to the extent vive to benefitfrom all this abundance. that really matters. However, the assertion that Passing to the terrestrialdowry, we find "the vast oil shales which are to be found all over to the best the world [would last] for no less than 40,000 that, according estimates, the years" [59, 99] is sheer fantasy. initial dowry of fossil fuel amounted to only " In an answer to critics (American Scientist, 215 Q. The outstanding recoverable reserves LVIII, No. 6, p. 619), the same authors prove, again linearly, that the agro-industrialcomplexes of the (known and probable) amount to about 200 grand plan could easily feed such a population.

This content downloaded from 132.198.40.43 on Thu, 22 Aug 2013 10:10:43 AM All use subject to JSTOR Terms and Conditions ENERGYAND ECONOMICMYTHS 371 grandlevel can be achieved,is brushedaside hand, there is the immense energyfrom the by Weinbergas "transscientific"[82].55 Tech- sun which reachesus withoutfail. Its direct nicians are prone to forget that due to their use is not yet practicedon a significantscale, own successes,nowadays it may be easier to the main reason being that the alternative move the mountainto Mohammedthan to in- industriesare now much more efficienteco- duce Mohammedto go to the mountain.For nomically.But promisingresults are coming the time being, the snag is far more palpable. from various directions [37; 41]. What As responsibleforums openly admit, even counts from the bioeconomic viewpoint is one breederstill presentssubstantial risks of that the feasibilityof using the sun's energy nuclear catastrophes,and the problem of directly is not surroundedby risks or big safe transportationof nuclearfuels and espe- questionmarks; it is a provenfact. cially that of safe storage of the radioactive The conclusionis that mankind'sentropic garbage still await a solution even for a dowrypresents another important differential moderatescale of operations[35; 36; espe- scarcity.From the viewpointof the extreme cially 39 and 67]. longrun, the terrestrialfree energy is far There remains the physicist's greatest scarcerthan that receivedfrom the sun. The dream, controlled thermonuclearreaction. point exposes the foolishnessof the victory To constitutea real breakthrough,it must be cry that we can finally obtain protein from the deuterium-deuteriumreaction, the only fossil fuels! Sane reason tells us to move in one that could open up a formidablesource the opposite direction,to convert vegetable of terrestrialenergy for a long era.56How- stuff into hydrocarbonfuel-an obviously ever, because of the difficultiesalluded to naturalline alreadypursued by several re- earlier (SectionIV), even the experts work- searchers[22, 311-313].57 ing at it do not find reasons for being too Fourth, from the viewpoint of industrial hopeful. utilization, solar energy has an immense For completion,we should also mention drawbackin comparisonwith energyof ter- the tidal and geothermalenergies, which, al- restrial origin. The latter is available in a thoughnot negligible(in all 0.1 Q per year), concentratedform, in some cases, in a too can be harnessedonly in very limited situ- concentratedform. As a result,it enablesus ations. to obtain almost instantaneouslyenormous The generalpicture is now clear. The ter- amountsof work, most of which could not even be obtained restrialenergies on which we can rely effec- otherwise.By great con- the flow of solar tively exist in very small amounts, whereas trast, energy comes to us with an low like a the use of those which exist in ampler extremely intensity, very fine rain, almosta mist. The im- amounts is surroundedby great risks and microscopic formidabletechnical obstacles. On the other portantdifference from true rain is that this radiationrain is not collected naturallyinto 'For a recent discussion of the social impact then into creeks of industrial growth, in general, and of the social streamlets, and rivers, and problems growing out of a large scale use of nuclear finallyinto lakes from wherewe could use it energy, in particular, see [78], a monograph by in a concentratedform, as is the case with Harold and Margaret Sprout, pioneers in this field. "One percent only of the deuterium in the waterfalls.Imagine the difficultyone would oceans would provide 108 Q through that reaction, face if one tried to use directly the kinetic an amount amply sufficient for some hundred energy of some rain as millions of years of very high industrial comfort. microscopic drops The reaction deuterium-tritium stands a better 7 It should be of interest to know that during chance of success because it requires a lower tem- World War II in Sweden, for one, automobiles were perature. But since it involves lithium-6, which driven with the poor gas obtained by heating exists in small supply, it would yield only about charcoal with kindlings in a container serving as a 200 Q in all. tank!

This content downloaded from 132.198.40.43 on Thu, 22 Aug 2013 10:10:43 AM All use subject to JSTOR Terms and Conditions 372 NICHOLASGEORGESCU-ROEGEN they fall. The same difficultypresents itself And, curiously,it is one of these aspectsthat in using solar energy directly (i.e., not has some far-reachingconsequences in ad- throughthe chemicalenergy of greenplants, dition to supplyinga most instructiverefuta- or the kinetic energyof the wind and water- tion of the common belief that every tech- falls). But as was emphasizeda while ago, the nological innovation constitutes a move in difficultydoes not amountto impossibility. the right directionas concernsthe economy Fifth, solar energy,on the otherhand, has of resources.The case pertainsto the econ- a unique and incommensurableadvantage. omy of modemagricultural techniques. The use of any terrestrialenergy produces some noxious pollution,which, moreover,is X. MODERNAGRICULTURE: AN ENERGYSQUANDERER irreducibleand hence cumulative,be it in the Given the extantspectrum of green plants form of thermalpollution alone. By contrast, and theirgeographical distribution at any one any use of solarenergy is pollution-free.For, time, the biologicalcarrying capacity of the whetherthis energy is used or not, its ulti- earth is determined,even though we could mate fate is the same, namely,to becomethe computeit only with difficultyand only ap- dissipatedheat that maintains the thermo- proximately.It is within this capacity that dynamicequilibrium between the globe and man struggleswith other life-bearingstruc- outerspace at a propitioustemperature.58 tures for food. But man is unique amongall The sixth asymmetryinvolves the elemen- speciesin that he can influence,within limits, tary fact that the survivalof every species on not only his share of food but also the earthdepends, directly or indirectly,on solar efficiency of the transformationof solar radiation(in additionto some elementsof a energyinto food. With time, man learnedto superficialenvironmental layer). Man alone, plow deeper, to rotate the use of land, to becauseof his exosomaticaddiction, depends fertilizethe soil with manure,and so on. In on mineral resources as well. For the use his farmingactivity, man also came to derive of these resources man competes with no an immensebenefit from the use of domesti- other species;yet his use of them usuallyen- cated draftanimals. dangers many forms of life, including his Two evolutionaryfactors have influenced own. Some species have in fact been farmingtechnology over the years.The oldest broughtto the brinkof extinctionmerely be- one is the continuouspressure of population cause of man'sexosomatic needs or his crav- on the extantland undercultivation. Village ing for the extravagant.But nothingin nature swarming,at first, and later migration,were compares in fierceness with man's com- able to relievethe pressure.Means of increas- petitionfor solar energy(in its primaryor its ing the yield of land also helped ease the by-productforms). Man has not deviatedone tension.The mainsource of release,however, bit from the law of the jungle;if anything,he remainedthe clearingof vast tracts of land. has made it even more mercilessby his so- The second factor, a by-productof the In- phisticatedexosomatic instruments. Man has dustrial Revolution, was the extension to openlysought to exterminateany speciesthat agricultureof the process by which low robs him of his food or feeds on him- entropyfrom mineral sources was substituted wolves,rabbits, weeds, insects, microbes, etc. for that of biologicalnature. The process is But this struggleof man withother species even more conspicuousin agriculture.Trac- for food (in ultimate analysis, for solar tors and other agriculturalmachines have energy)has some unobtrusiveaspects as well. taken the place of man and draft animals, "One necessary qualification: even the use of and chemical fertilizers, that of manuring solar energy may disturb the climate if the energy and fallowing. is released in another place than where collected. The same is true for a difference in time, but this However,mechanized agriculture does not case is unlikely to have any practical importance. fit small family farms which have at their

This content downloaded from 132.198.40.43 on Thu, 22 Aug 2013 10:10:43 AM All use subject to JSTOR Terms and Conditions ENERGYAND ECONOMICMYTHS 373 disposal a large supply of free hands. Yet stitute a good energetic deal.) This means even in this case it had to come. The peasant that, if half of the input of terrestrialenergy who practicesorganic agriculture,who uses (countedfrom the miningoperation) required animalsfor power and manureas fertilizer, by modem agriculturefor one acre---culti- must grow not only food for his family but vated, say, with wheat-is used each year, in also fodder for his helpers. The increasing two years the less industrializedagriculture pressureof populationthus forced even the would produce more than twice as much small farmer, practicallyeverywhere, to do wheat from the same piece of land. This dis- away with the beasts of burdenso as to use economy-surprising as it may seem to the his entireland for food [27, 526; 31, 1if; 32, worshipersof machinery-is especiallyheavy 302f]. in the case of the high-yieldvarieties which The point beyond any possible doubt is earnedtheir developer,Norman E. Borlaug, that, given the pressureof populationin the a Nobel Prize. greaterpart of the globe, there is no other A highlymechanized and heavilyfertilized salvationfrom the calamitiesof undernutri- cultivation does allow a very large popu- tion and starvationthan to force the yield lation, Pi, to survive, but the price is an in- on the land under cultivation by an in- crease of the per capita depletion of ter- creasingly mechanized agriculture, an in- restrial resources sj, which ceteris paribus creasinguse of chemicalfertilizers and pes- means a proportionallygreater reduction of ticides, and an increasingcultivation of the the future amountof life (SectionVIII). In new high-yield varieties of cereal grains. addition,if growingfood by "agro-industrial However, contraryto the generallyand in- complexes"becomes the generalrule, many discriminatelyshared notion, this modem speciesassociated with old-fashioned, organic agriculturaltechnique is in the longrun a agriculturemay graduallydisappear, a result move against the most elementarybioeco- which may drive mankindinto an ecological nomicinterest of the humanspecies. cul-de-sacfrom which therewould be no re- First, the replacementof the waterbuffalo turn [31, 12]. by the tractor,of fodder by motor fuels, of The above observations bear upon the manureand fallowingby chemicalfertilizers perennialquestion of how many people the substitutes scarcer elements for the most earthcould support.Some population experts abundant one-solar radiation. Secondly, claim that there would be enoughfood even this substitutionalso representsa squander- for some fortybillion people at a diet of some ing of terrestriallow entropy because of its 4,500 kilocalories provided that the best strongly decreasingreturns."9 What modem farmingmethods were used on every acre of agriculturaltechnique does is to increasethe potentiallyarable land.60The logic rests on amountof photosynthesison the same piece multiplyingthe amountof potentiallyarable of cultivated land. But this increase is land by the current average yield in Iowa. achieved by a more than proportionalin- The calculations may be as "careful" as crease in the depletionof the low entropyof boasted-they represent,nonetheless, linear terrestrialorigin, which is the only critically thinking.Clearly, neither these authors nor scarce resource. (We should note that de- those less optimistic have thought of the creasingreturns in substitutingsolar for ter- crucial question of how long a population restrialenergy would, on the contrary,con- of forty billion-nay, even one of only one 19Between 1951 and 1966, the number of trac- millionfor that matter--can last [31, 11; 32, tors increased by 63 percent, phosphate fertilizers 20, 301f]. It is this question which, more by 75 percent, nitrate fertilizers by 146 percent, and pesticides by 300 percent. Yet the crops, which I This position has been advanced, for ex- may be taken as a good index of yield, increased by ample, by Colin Clark in 1963 [see 31, 11; 32, 20], only 34 percent! [6, 40] and very recently by Revelle [70].

This content downloaded from 132.198.40.43 on Thu, 22 Aug 2013 10:10:43 AM All use subject to JSTOR Terms and Conditions 374 NICHOLASGEORGESCU-ROEGEN than most others, lays bare the most stub- This is exactlywhat happensfor the irrepro- born residualof the mechanisticview of the ducible resources.Each generationcan use world, which is the myth of the optimum as many terrestrialresources and produceas population"as one that can be sustainedin- much pollutionas its own biddingalone de- definitely"[6, 14; also 62, 172f; 74, 48]. cides. Futuregenerations are not, simplybe- cause they cannotbe, presenton today'smar- XI. A MINIMALBIOECONOMIC PROGRAM ket. To be the demand of the In "A for Survival" the sure, present Blueprint [6, 13], reflects also the interest to is thateconomics and generation pro- hope expressed ecology tect the childrenand the will one The same has perhaps grandchil- day merge. possibility dren. also reflect future been considered for and Supplymay expected already biology over a few decades. But neither the with most that in prices physics, opinionsagreeing currentdemand nor the current can the wouldswallow supply mergerbiology up physics include even in a form the situa- For the same reason- very slight [32, 42]. essentially tion of more remote those that the domain covered generations,say, phenomenal by of A.D. let alone those that is broaderthan that covered eco- 3,000, might ecology by exist a hundredthousand from now. will have to into years nomics--economics merge Not all the but the most if the ever occurs. as details, certainly ecology, merger For, of allocationof re- we have seen in the two importantconsequences preceding sections, sources the market economic of has among generationsby the activity any generation mechanism be to the fore a some influenceon that of the future may brought by genera- a dia- resources of and very simple, actually highly simplified tions-terrestrial energy We shall assumethat demand for some materials are used and the gram. irrevocably up mineral resource mined coal- harmfuleffects of on the environ- already (say, pollution is the same for each succes- ment accumulate.One of the most on-the-ground) important sive andthat each must for generation generation ecological problems mankind,therefore, consumeat least one "ton"of coal. The de- is the of the of life of relationship quality mand schedule is also assumed to include one with another-more generation specifi- the for the interestsof the distributionof mankind's preference protecting cally, dowry a few future In DI, D2, all Economics cannot generations. Figure 1, among generations. ... the demands of even dream of this The D15 represent aggregate handling problem. successive with the of as has often been ex- generations,beginning object economics, one. The line is the administrationof scarce re- present interrupted abcdef rep- plained, resents the cost of the de- but to be we should add that average mining sources; exact, of variousaccessibilities. Total reserves this administration one posits regards only genera- amountto 15 tons. if we for a tion. It could not be otherwise. Now, ignore momentthe effect of the interestrate on the There is an of eco- elementaryprinciple of the coal in situ the owners of nomics to which the to supply by according only way the then the first will mine attributea relevant to an mines, generation price irreproducible the amount the shaded area to Leonardo'sMona is to a'b', represent- object, say, Lisa, the differentialrent of the better mines. have bid on it. Other- ing absolutelyeveryone We aa' as the of the if and I were to one of us may safely regard price wise, only you bid, coal contained in these mines. The second could get it for just a few dollars. That bid, generationwill mine the amount b'c'. But i.e., that price, would clearly be parochial.61 depletion [62, 181], and Barry Commoner, of the 61Yet the economist's myth that prices reflect cost of environmental deterioration [18, 253f and values in some generally relevant sense is now passim]. These are purely verbal expressions, for shared by other professions as well. The Meadows there is no such thing as the cost of irreplaceable group, for example, speaks of the cost of resource resources or of irreduciblepollution.

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D1D2 D3 D4 D515 picture somewhatand allows us to see even more clearlythe impotenceof the marketto prevent the excessive depletionof resources by the earlier generations.Let us consider the case whichI earliercalled a bonanzaera. Specifically,it is the situation in which the best quality of coal mine suffices to satisfy the present demand as well as that of the future generationsas far as the presenteco- nomictime horizongoes. Withinthis horizon, c c then, there is no rent at any time and hence no inducementto save coal in situ for future generations.Coal in situ can thus have no 5 10 15 priceduring the presentgeneration. FIGURE1 The question ignored by the few econo- mists who have recentlytackled some market since no mine will earn a differentialrent, the aspects of naturalresources [e.g., 75] is why price of the coal in situ will be zero. During resourcesin situ may, after all, have a the third generation, the marginal cost of posi- tive price even if there are no self-imposed miningwill be at the level of h; the quantity restrictionsby the mine owners.The answer mined will be gh, with the quantityc'c = gg' is that if presentresources have a it is earning the rent shown by the shaded area. price, not ordinarilybecause of present Finally, the fourthgeneration is left with the scarcity, but because of some expected differential amounthh' (determinedby the conditionthat scarcitywithin the time horizon.To g'd = h'e), which will earn a present pure scarcity illustrate the rationale of this let rent, the shaded area process, representedby hh'i'i. C1, be coal mines will be left for the C2, C3 of differentqualities, Nothing followinggenera- the tions. costs of mining one unit of coal being ki < k2 < k3, Let us further Several are now obvious. First, the respectively. things assume that C1 is to be exhausted market mechanism itself results in re- expected by the third after the sources consumed in amounts during generation present being higher one, when C2 will become the earlier that fasterthan economicallyeffi- by generations, is, cient. Let us also assume that in should be. > > > C2, turn, they Indeed, a'b' b'c' gh will be exhausted the second hh', which confirmsthe of the during genera- dictatorship tion and that will then over the future. Should all the thereafter, Ca suffice present gen- for the remainderof the time horizon. erationsbid from the outset for the total de- During the third future generation,C1 will to posit of coal, the price of coal in situ will be prove enjoy a differential rent = k2 - with re- drivenup to infinity,a situationwhich would rl kl spect to C2, and after two more generations lead nowhereand only explode the entropic the differentialrent of C2 over C3, r2 = k3 - predicamentof mankind.Only an omniscient k2, will become manifest. C3 has no plannercould avoid this situation Only by simply differentialrent, and hence, as we have seen allocatingone ton of coal in situ to each of in the previous paragraph,its price is zero the firstfifteen generations, each ton consist- throughout.On the other hand, because C2 ing of the same qualitativecomposition.62 necessarilyearns a rent in the fifth Bringingin the interest rate modifies the genera- " tion from now, it must have a present posi- In a work demon- pioneering [45], Hotelling tive price, namely, P20 = r2/(1 + where i strated once for all that one cannot speak of i)5, optimum allocation of resources unless the demand is the interest rate (assumed constant over the entire future is known. throughout the time horizon). In the j-th

This content downloaded from 132.198.40.43 on Thu, 22 Aug 2013 10:10:43 AM All use subject to JSTOR Terms and Conditions 376 NICHOLASGEORGESCU-ROEGEN generationfrom now, the price will be p2j = interestedin the well-beingof our contem- r2/(l + i)5-'. A similarlogic determinesthe porary "neighbors."This parallel does not presentprice of C1. Only, we must observe mean that the new ethical orientationis an that during the generationwhen the differ- easy matter. Charity for one's contempo- ential rent of C1 becomes manifest,the price rariesrests on some objectivebasis, namely, of C2 is p2 = r2/(1 + i)2. The rent must the individualself-interest. The difficultques- thereforebe added to this price. Hence, the tion one has to face in spreadingthe new present price of the coal of C1 is p10 = (rl + gospel is not "what has posterity done for pD)/(1 + 0.8 me?"-as Boulding wittily put it-but, The formulae just establishedshow that rather, "why should I do anythingfor pos- the effect of the interestrate in the presence terity?"What makes you think, many will of a qualitativespectrum of mines is to ex- ask, that therewill be any posterityten thou- tend the use of coal minedfrom more acces- sand years from now? And indeed, it would sible sources (in comparisonto the quanti- certainlybe poor economicsto sacrificeany- ties determinedby Figure 1). In some rather thing for a nonexistent beneficiary.These idle way, we may say that the existence of questions, which pertain to the new ethics, the interest rate helps the economy of re- are not susceptibleof easy, convincingan- sources. But let us not ignore the far more swers. importantconclusion of the foregoinganaly- Moreover,there is the other side of the sis, whichis especiallystriking in the case of coin, also ethical and even more urgent,on an era of bonanza.Serious scarcities may be- which Kaysen[51] and Silk [72], in particu- come effective(as will certainlyhappen) be- lar, have rightlyinsisted. The natureof Mo- yond the present time horizon. That future hammed-menbeing what it is, if we stop fact can in no way influenceour presentmar- economic growtheverywhere, we freeze the ket decisions;it is virtuallyinexistent as far presentstatus and thus eliminatethe chance as these decisionsare concerned. of the poor nationsto improvetheir lot. This Nothing need be added to convince our- is why one wing of the environmentalist selves that the market mechanism cannot movementmaintains that the issue of popu- protect mankind from ecological crises in lation growthis only a bogy used by the rich the future (let alone to allocate resources nationsin orderto divertattention from their optimally among generations) even if we own abuse of the environment.For this would try to set the prices "right."63 The group, there is only one evil-inequality of only way to protectthe futuregenerations, at development.We mustproceed, they say, to- least from the excessive consumptionof re- ward a radical redistributionof productive sources during the present bonanza, is by capacity among all nations. Another view reeducatingourselves so as to feel some argues that, on the contrary, population sympathyfor our future fellow humans in growthis the most menacingevil of mankind the same way in which we have come to be and must be dealt with urgentlyand inde- pendentlyof any other action. As expected, "The economist's characteristic confidence in the two the omnipotence of the price mechanism (Section polarizedviews have never ceased IV, note 15) led many of my auditors to counter clashing in useless and even violent con- that the choice between satisfying present or future troversies-as happened especially at the needs, with the-usual reward for postponing con- StockholmConferences in sumption, will set the prices right for optimal use 1972, and, quite of resources. The argument fails to take into recently, at the Bucharest Conference on account precisely the limitation of our time Population.64 The difficulty is again seated horizon, which does not extend beyond a couple of decades [10, 10]. Even Solow, in an illustration in human nature:it is mutual, deep-rooted defending the standard position [74, 427], assumes " For a highly interesting account of the cross- a horizon of thirty years only. currentsat the Stockholm Conference, see [2].

This content downloaded from 132.198.40.43 on Thu, 22 Aug 2013 10:10:43 AM All use subject to JSTOR Terms and Conditions ENERGYAND ECONOMICMYTHS 377 mistrust--of the rich that the poor will not istence. The most we can reasonablyhope is cease growing in numbers and of the poor thatwe mayeducate ourselves to refrainfrom that the rich will not stop gettingricher. Sane "unnecessary"harm and to protect, even at reason, however,invites us to recognizethat some cost, the futureof our species by pro- the differentialgradient between the poor tectingthe species beneficialto us. Complete and the rich nations is an evil in itself, and protectionand absolute reductionof pollu- althoughclosely connected with continuous tion are dangerousmyths which must be ex- populationgrowth, it must be dealt with di- posed as such (SectionV). rectly as well. Justus von Liebig observedthat "civiliza- Becausepollution is a surfacephenomenon tion is the economyof power"[32, 304]. At which also strikesthe generationwhich pro- the present hour, the economy of power in duces it, we may rest assuredthat it will re- all its aspects calls for a turningpoint. In- ceive much more official attention than its stead of continuingto be opportunisticin the inseparablecompanion, resource depletion. highest degree and concentratingour re- But since in both cases thereis no such thing search toward finding more economically as the cost of undoing an irreparableharm efficientways of tappingmineral energies- or reversing an irrevocable depletion, and all in finitesupply and all heavy pollutants- since no relevantprice can be set on avoid- we should direct all our efforts toward im- ing the inconvenienceif future generations provingthe direct uses of solar energy-the cannot bid on the choice, we must insist that only clean and essentiallyunlimited source. the measurestaken for eitherpurpose should Already known techniques should without consist of quantitativeregulations, notwith- delay be diffused among all people so that standingthe adviceof most economiststo in- we all may learn from practiceand develop crease the allocationefficiency of the market the correspondingtrade. throughtaxes and subsidies.The economists' An economy based primarilyon the flow plank will only protect the wealthy or the of solar energy will also do away, though political prot6g6s.Let no one, economistor not completely, with the monopoly of the not, forget that the irresponsibledeforesta- present over future generations, for even tion of numerousmountains took place be- such an economy will still need to tap the cause "the price was right"and that it was terrestrialdowry, especially for materials. broughtto an end only after quantitativere- The depletionof these criticalresources must strictionswere introduced.But the difficult therefore be rendered as small as feasible. nature of the choice should also be made Technologicalinnovations will certainlyhave clear to the public-that slower depletion a role in this direction.But it is high time for means less exosomatic comfort and that us to stop emphasizingexclusively-as all greatercontrol of pollutionrequires propor- platformshave apparentlydone so far-the tionately greater consumptionof resources. increaseof supply. Demand can also play a Otherwise,only confusionand controversies role, an even greater and more efficientone at cross-purposeswill result. in the ultimateanalysis. Nor shouldany reasonableecological plat- It would be foolish to propose a complete form ignore the basic fact that, from all we renunciationof the industrialcomfort of the know about the strugglefor life in general, exosomatic evolution. Mankind will not man will probably not let himself down, returnto the cave or, rather,to the tree. But when pressed for his needs, natural or ac- thereare a few pointsthat may be includedin quired, by sparing his competitors(includ- a minimal bioeconomic program. ing futurehumans). There is no law in biol- First, the production of all instruments of ogy stating that a species must defend the war, not only of war itself, should be pro- existenceof others at the cost of its own ex- hibited completely. It is utterly absurd (and

This content downloaded from 132.198.40.43 on Thu, 22 Aug 2013 10:10:43 AM All use subject to JSTOR Terms and Conditions 378 NICHOLASGEORGESCU-ROEGEN also hypocritical) to continue growing morbid craving for extravagantgadgetry, tobacco if, avowedly, no one intends to splendidlyillustrated by such a contradictory smoke. The nations which are so developed item as the golf cart, and for such mammoth as to be the main producersof armaments splendorsas two-garagecars. Once we do so, shouldbe able to reacha consensusover this manufacturerswill have to stop manufactur- prohibitionwithout any difficultyif, as they ing such "commodities." claim, they also possess the wisdom to lead Sixth, we must also get rid of fashion, of mankind. Discontinuingthe production of "thatdisease of the humanmind," as Abbot all instrumentsof war will not only do away Fernando Galliani characterizedit in his at least with the mass killings by ingenious celebratedDella moneta(1750). It is indeed weaponsbut will also release some tremen- a disease of the mind to throw away a coat dous productiveforces for internationalaid or a piece of furniturewhile it can still per- withoutlowering the standardof livingin the form its specificservice. To get a "new"car correspondingcountries. every year and to refashionthe house every Second, through the use of these pro- other is a bioeconomiccrime. Otherwriters ductiveforces as well as by additionalwell- have alreadyproposed that goods be manu- planned and sincerely intended measures, facturedin such a way as to be more durable the underdevelopednations must be aided to [e.g. 43, 146]. But it is even more important arrive as quickly as possible at a good (not that consumersshould reeducatethemselves luxurious) life. Both ends of the spectrum to despise fashion. Manufacturerswill then must effectivelyparticipate in the efforts re- have to focus on durability. quiredby this transformationand accept the Seventh,and closely relatedto the preced- necessityof a radicalchange in their polar- ing point, is the necessitythat durablegoods ized outlookson life.65 be madestill moredurable by beingdesigned Third, mankind should gradually lower so as to be repairable.(To put it in a plastic its populationto a level that could be ade- analogy, in many cases nowadays,we have quately fed only by organic agriculture.66 to throwaway a pairof shoes merelybecause Naturally, the nations now experiencinga one lace has broken.) very high demographicgrowth will have to Eighth, in a compellingharmony with all strivehard for the most rapidpossible results the above thoughtswe shouldcure ourselves in that direction. of whatI havebeen calling"the circumdrome Fourth,until eitherthe directuse of solar of the shavingmachine," which is to shave energy becomes a general convenience or oneself faster so as to have more time to controlled fusion is achieved, all waste of workon a machinethat shavesfaster so as to energy-by overheating,overcooling, over- have more time to work on a machinethat speeding,overlighting, etc.-should be care- shaves still faster, and so on ad infinitum. fully avoided,and if necessary,strictly regu- This change will call for a great deal of re- lated. canting on the part of all those professions Fifth, we must cure ourselves of the whichhave luredman into this emptyinfinite "At the Dai Dong Conference (Stockholm, regress.We must come to realizethat an im- 1972), I suggested the adoption of a measure, which portantprerequisite for a good life is a sub- seems to me to be applicable with much less diffi- culty than dealing with installations of all sorts. stantial amountof leisure spent in an intel- My suggestion, instead, was to allow people to ligent manner. move freely from any country to any other country Consideredon in the the whatsoever. Its reception was less than lukewarm. paper, abstract, See foregoing recommendationswould on the "[2, 72]. To avoid any misinterpretation,I should add whole seem reasonableto anyone willing to that the present fad for organic foods has nothing examinethe on to do with this proposal, which is based only on the logic whichthey rest.But one reasons expounded in Section X. thoughthas persistedin my mind ever since

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