The Ultimate Resource

... Or How the Doomsdayers Are Always Wrong

ISBN 0-691-09389-X

The Ultimate Resource by Julian L. Simon is (possibly) a red-pilling book that I recommend everyone read. It acts as a great antidote to the doomsday predictions brought forth by the ilk of Paul Ehrlich and others as well as show how all these perceived societal "ills," like overpopulation (whatever that is), are actually good things. So, in this article I hope to give you the best introduction to Simon's work that a non-economist like myself can, and I genuinely implore you to read this book. (Its expensive, but you won't regret it.)

So you probably looked this book up and found out that its about 40 years old, and you now think it may be irrelevant. Truly I tell you, I think this book may have gotten better with age rather than worse, because we've had time to see Simon's principles in action.

Natural Resource Finiteness

One of the first points Simon makes is that natural resources are NOT finite in any economically meaningful sense, but this requires some serious qualifications. First, Simon says this regarding scarcity:

We will not reach up to the shelf and suddenly find that it is completely bare... there still would be some quantities to be found at some price, just as there always has been some small amount of food for sale even in the midst of the very worst famines. (pg. 17)

The point here is that there is an inclination of people and firms to always provide resources, feast or famine. Even in a "shortage," it pays to be the guy who can provide a resource or service. In fact, "scarcity" actually drives producers to (a) find new resources, (b) develop new technologies to extract more resources, or (c) find substitute resources.

While we could argue about absolute finiteness, that is, there is only X amount of copper in the earth's crust (a number we have no clue of), this is an economically meaningless statement for the reasons above. New copper may be found; new technology can allow the improved extraction of known reserves of copper; or, and this is the lynchpin, it isn't copper that we want, it is the services copper provides. Ergo, producers will seek alternatives to copper that provide similar services.

With all that said, Simon sharply critiques the way calculations are made about, "We only X years left of copper." The measurements used are fundamentally flawed,

To sum up, this technological view of natural-resource measurement is hardly useful even in principle, let alone in operation. First, there is an almost insuperable difficulty in the definition of available "copper," "oil," and so on, because there are many different grades of each resource in places that vary in difficulty of extracting the resource and because the amounts at low concentrations (such as the quantities of metals on the sea bottom and in sea water) are extraordinarily large in contrast to the quantities we usually have in mind (the "proven reserves"). Second, we constantly create new supplies of resources, in the sense of discovering them where they were thought not to exist.(pg.31)

Making meaningful calculations about the amount of any resource is basically impossible, so for doomsayers to claim "We will runout of aluminum in X amount of years!" is nonsensical.

Other Topics and Conclusion

Simon covers other topics too such as decreasing trends in pollution, increasing food supply, and a convincing argument for the good of population growth which I will not cover here, because I hope you will go read it. Despite being written for us laymen, The Ultimate Resource contains a treasure trove of economic data that seems to contradict the Malthusian disaster scenario we have been spoon-fed for decades regarding "standing-room only," and mass starvation. Also, considering this book came out over 40 years ago now, I believe Simon may have been more correct than he is given credit for: there isn't mass starvation, the human population has grown considerably, and we never seem to run out of resources (though the banksters make sure we continue to pay inflated prices!).

But go read it and judge for yourself whether it is absolutely based, or complete quackery.