“Scarcity” at Root of Political Polarization?

July 23, 2014

http://www.pbs.org/newshour/bb/politically-divided-wisconsin-little-incentive-seek-middle-ground/

The above link will take you to a story that aired on the PBS Newshour on July 18th.  It’s a story about the political divide in Wisconsin and is followed by analysis by David Brooks (conservative and Wall Street Journal columnist) and Mark Shields (liberal commentator).

Brooks’ analysis was particularly poignant.  He explained that he once believed our polarization was a top-down, Washington-based phenomenon, but now sees it as a bottom-up movement, driven by “scarcity.”

The significance of this is that “scarcity” is a term used by economists, primarily to deride those concerned with overpopulation as having a “scarcity mentality.”  It’s an alternative to “Malthusian,” lest the latter term become trite.  You see, economists don’t believe in the concept of “scarcity.”  Man is clever enough to stretch resources and always assure that there is enough for all as our population continues to grow, say economists.

So it’s significant that someone of Brooks’ gravitas sees actual scarcity in our economy that is the driving force behind our polarization.  It’s not a scarcity of natural resources but a scarcity of jobs, a scarcity of income, a dwindling of resources needed to provide adequate health care and of government resources necessary to provide a social safety net.  Such scarcity now pits Americans one against another as they compete for these ever-more-scarce financial resources.  Each side now sees the other as a threat instead of as fellow Americans working toward a common goal.  The haves see the have nots as a threat to strip them of some of their wealth through redistribution schemes.  The have nots see the wealth of the haves as ill-gotten gains that have been taken from them unfairly with the collusion of their conservative politicians.  With each side  perceiving themselves as having their backs against the wall, neither is willing to compromise.  We’ve become like an overcrowded cage full of  animals where all was peaceful until the zookeeper began cutting back on the food thrown into the cage.

This scarcity is the direct consequence of the rising unemployment and worsening poverty that’s inescapable as overcrowding drives down per capita consumption and, with it, employment.  And it’s not merely a national phenomenon, but a global one, as labor forces continue to swell and compete for ever-more-scarce manufacturing jobs just to keep themselves out of poverty.

If Brooks is right (as I believe he is) that scarcity lies at the root of our political polarization, then the polarization and gridlock in Washington is only going to get worse.


Reuters Columnist’s Defense of Overpopulation

November 3, 2011

http://blogs.reuters.com/edward-hadas/2011/11/02/7-billion-reasons-why-malthus-was-wrong/

The above-linked editorial appeared on Reuters yesterday.  It’s one of the most twisted-logic-defenses of population growth that I’ve seen yet.  The author, Edward Hadas, begins with a denial that Malthus correctly predicted some of the effects we’re witnessing today:

 The early 19thcentury British thinker decided (without providing any reasons) that people would always have more children than the physical world could possibly support. Population growth would always be restrained by death from want. At the time he wrote, the world’s population was about 1 billion. By the 1960s, the population had increased to about 3 billion people, and Malthus’s gloom was often cited. Some ecologists then claimed that the combination of industrial production and overpopulation would inevitably lead to environmental catastrophes – and many deaths from want.

And yet up to now, Malthus has been wrong

Is this guy really denying that there have been no environmental catastrophes?  A few quickly come to mind:  climate change, the BP oil spill disaster in the gulf, the Exxon Valdez oil spill disaster in Prince William Sound, nuclear disasters in Chernobyl and Fukushima.  The list goes on and on.  And there have been no “deaths from want?”  Is this guy completely blind to the fate of people in the undeveloped world, which represents a large percentage of the world’s population?

But then, after mocking Malthus for being wrong up to this point (in his eyes), he then seems to admit that Malthus may yet be proven to be right:

Still, it cannot be proven that Malthus was wrong, that the world will never run out of stuff or that humanity’s resourcefulness will always rise to environmental, economic and social challenges.

But then, once again, Hadas hears the siren call of the “don’t worry, be happy” economists, more concerned with the problems associated with an aging and declining population. 

… while grim environmental forecasts are still easy to find, demographers these days talk more about the stresses that come with ageing and declining populations.

… the practical challenges can be met easily.

Instead of worrying, economists should take the latest demographic milestone as an opportunity to stop thinking like Malthus …

Of course, it’d be easier to stop worrying if it weren’t for all the data that screams warnings at us about overpopulation.  What to do about that?  “Don’t worry, be happy!”  Ignore it!  Hadas then singles out one of the biggest red flags of all, the one I’ve featured in this blog many times – GDP per capita.

A good starting point would be to stop relying on GDP per capita when comparing the wealth of nations. In this calculation of average income, population is the denominator. If that increases, the per capita GDP will fall, unless the numerator – production – increases commensurately. In effect, this measure makes each new person an economic drag.

Yes, if GDP holds constant as the population continues to grow, then everyone is getting poorer and population growth becomes a drag.  It’s an inescapable fact.  Hadas seems to have a hard time dealing with facts, especially (I suspect) if those facts cry out for an economic change that might threaten the growth prospects for his stock portfolio.  So, at this point, Hadas simply chooses to ignore the facts and gets all sappy on us:

A new person is indeed a consumer who will need to work to avoid being a net drain on the world’s resources. But he or she is also a wonder worth celebrating. Parents know it, and economists should recognize that reproduction is a sort of production – brought forth through maternal labor and parental care. Economic activity should aim at the promotion of life, not merely at the production of stuff.

What?!?!?  If economists theories are failing us economically, then economists should ignore the data and focus instead on “the promotion of life?”  If we’re driving toward a cliff, we should just close our eyes and put the pedal to the metal?!?!? 

This conclusion caps off one of the stupidest, most illogical defenses of overpopulation that I’ve seen yet.  There are three kinds of people in this world:  (a) those who continue to believe as they do because they’ve never pondered the facts, (b) those who have taken the time to ponder reality and change their opinion accordingly, and (c) those who ponder the facts and reality but then continue to promote what they now know to be lies, to the detriment of humanity,  just because it suits their purpose.  I suspect that that last group of people will be judged harshly in the end.


Economists Admit to Being Clueless about Jobs

July 11, 2011

http://www.cnbc.com/id/43711926

The above-linked article just appeared on CNBC this afternoon.  It seems that economists are admitting to being flummoxed by the incredibly bad June employment report when all of them were expecting some halfway decent job growth. 

I posted a comment in reply to the article at about 1:21 PM, if you want to find it.  But to make it easier, here was my reply:

Economists are clueless about jobs because economists steadfastly refuse to consider the most dominant parameter affecting our economy today – population growth. Since the seeming failure of Malthus’s economic theory about population in the 1800s, anyone who dares to suggest that overpopulation could present a problem for the economy is instantly dismissed as a “Malthsian.”
 
That’s a pity because if economists would once again open their eyes to the full ramifications of population growth and not just the strain on resources and stress on the environment, they may discover very serious consequences for the economy itself in the form of falling per capita consumption and rising unemployment, and the role that population density disparities play in driving global trade imbalances.

Ever-worsening unemployment, destructive trade imbalances and the global debt problem – these are no mystery. They’re completely predictable when you understand the relationship between excessive population densities and low per capita consumption.

Pete Murphy
Author, “Five Short Blasts”

So, “economists,” what are you going to do about it?  Cling to your incomplete economic models or open your minds to the one parameter you refuse to consider in your economic equations?  Sadly, I think I know what their reply will be.  “Malthusian.”