In 1905, Albert Einstein introduced to the world his theory of relativity, postulating that the laws of physics must hold true regardless of the observer’s frame of reference. While this may have seemed simplistic or even self-evident to people like you and me, firmly rooted in our slow-moving, earth-bound existence, it was truly profound for physicists who think in terms of space and stars and the speed of light. Its logical consequences led to mind-blowing discoveries of relationships between time and speed, space and matter and rewrote the laws of physics, beginning with the most fundamental. Thanks to Einstein, it’s now understood that the apple Isaac Newton observed falling from the tree was driven not by a force of gravity, but by the curvature of space. Once decoupled from the tree’s branch, and lacking any other influencing forces (like a strong wind), it fell toward the earth because that’s the only direction in which the curvature of space would allow it to go.
This past 4th of July weekend, the news programs all carried stories of the reopening to the public of the stairway to the crown of the Statue of Liberty. But for seemingly obvious, practical reasons, the tiny spiral staircase forced officials to limit access to only thirty people per hour. At first I was struck by the irony of it – that this monument to our heritage of immigration and the belief that we can grow our population without end – should itself impose a limit on the number of its visitors. Thirty people per hour. That’s it. No more are welcome.
Then it hit me: if the laws of physics must hold true regardless of an observer’s frame of reference, then shouldn’t that also be true for the field of economics? Shouldn’t its laws apply to an observer inside Lady Liberty just as much as they would to an observer of something larger, like the United States as a whole? Of course they should. The laws of economics do not transcend the laws of physics.
For example, consider the law of supply and demand, one of the most fundamental precepts of economics. It still holds true inside Lady Liberty. If I were a vendor of bottles of water in the crown of the statue at the top of that staircase, I could command a higher price if all I had left was a single bottle of cold water than if I had a large supply of 100 bottles.
So what about economists’ claim that overpopulation can never be a problem because man is ingenious enough to overcome any obstacle to further growth? Let’s apply that to Lady Liberty. Why should we place any limit at all on the number of people inside the statue? It’s because in that relatively tiny frame of reference, it’s patently obvious that it’s impossible to accommodate more than a relatively small number of people. Just as the sheet metal of a Volkswagen limited the number of college students that could be stuffed inside when such games were in vogue back in the ’60s, the copper skin of Lady Liberty limits the number of visitors that can be stuffed inside.
Thus, if relativity is applied to the field of economics, then the claim that population growth can never become a problem fails at the most basic level. Why? Because it’s not really a “law” of economics. It’s a dodge that economists adopted in response to the seeming failure of Malthus’ theory that shortages of food would limit population growth. Either unable or unwilling to further evolve Malthus’ theory about overpopulation, economists simply cupped their hands over their ears, like the “hear no evil” monkey, and vowed never to consider overpopulation again. They adopted the “growth is good; growth is no problem” mantra and repeated it over and over until they actually began to believe it.
Then how can economists get away with making this claim? It’s because when people consider the subject of population, the frame of reference that automatically comes to mind is so large as to be nearly infinite for all practical purposes: the entire country of the United States, for example – an area of over three million square miles. It’s difficult to comprehend the boundaries of such a vast expanse ever being a practical limit to the number of people that can be contained within. And because it’s difficult to comprehend it ever being a problem, no one is willing to consider any of the consequences of a growing population. Beyond resources and strain on the environment, is there anything else that may tend to limit the size of the population before we become a sea-to-shining-sea, quarter mile deep mass of human flesh? What happens as we crowd together into smaller spaces? Will our per capita consumption begin to decline? What does this mean for per capita employment? Could it be that poverty will prove to be the ultimate barrier to excessive growth?
As in physics, presumed “laws” of economics that don’t stand up to scrutiny in one frame of reference are failures for every frame of reference. And the longer we cling to such “laws,” the more unlikely progress toward valid economic models becomes.