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Cheer up –The world is a wonderful place

By David Seymour
web posted December 20, 2010

It's easy to feel pessimistic for our species. A very few people are getting richer, the glum complain, but only by exploiting the poor. And when they're not running down their contemporaries, the lament goes, the exploiters steal from future generations by trashing the environment.

The merchants of gloom derive their pessimism from the underlying misapprehension that life is a zero-sum game. They choose to believe that wealth can only ever be taken, never created, so there can never be improvement, only injustice. The reality is that everyone is getting wealthier and the environment is generally improving, so something else must be happening: Human ingenuity is creating win-win results.

If you doubt that, consider the phenomenon of e-Bay. It has generated billions of dollars of value by solving the search problem for hoarders and buyers alike. Not many have lost wealth as a result of e-Bay but almost everyone is better off, including the environment since e-Bay has reduced the demand for new goods. e-Bay is a spectacular but normal example, just like the wheel, cell phones, home appliances, better management in companies, and so it has gone on.

It's hard to overstate that extraordinary innovations in medicine, nutrition, and sanitation doubled life expectancy since the Industrial Revolution, from only 40 in England in 1800 to around 80 in most of the developed world today. .

The benefits are more widely spread than commonly thought. The United Nations Human Development Index, which has measured health, longevity, access to knowledge, and a "decent standard of living" since 1980, shows that nearly all countries have improved over the past three decades. What's more, the "spread" of scores has been narrowing, meaning that the least developed countries are catching up. The rich are certainly getting richer, but the poor are getting richer too, and faster.

What about oppression? There certainly are some nasty characters around; Venezuela's Hugo Chavez and Zimbabwe's Robert Mugabe come to mind. However they are exceptions to an overwhelmingly positive trend. Freedom House, an organisation dedicated to measuring civil liberties and political rights, reported only 44 free countries in 1972. Today there are 89, with the number of un-free countries having steadily declined to 43 from 68 over the same period and a varying number in the "partly free" transition stage.

The moaners will surely moan that a world with an ever increasing population who enjoy ever increasing living standards will invite an environmental Armageddon. But people who make such arguments fail to understand three counterintuitive facts about economic growth and the environment.

Living standards are a measure of the value of finished goods and services consumed, not the value of resources used to produce them. In fact, profit motivates the production of more valuable goods using fewer resources. Consider the difference between the iPhone on the one hand and a camera, network of telephone cables, record collection, calculator, and alarm clock on the other. The iPhone offers the same features as the latter products combined but consumes far fewer resources. Getting richer is compatible with conserving the environment.

They also fail to understand that increased wealth increases environmental concerns and the demands to protect it. To put it bluntly, starving people can't afford to join Greenpeace. More seriously, wealthy countries with advanced agriculture can afford to set land aside for nature reserves. They can afford to enforce environmental regulations, their industries can afford to adhere to them, and wealthy people have more time to enjoy nature. Yale and Columbia Universities' Environmental Performance Index confirms that freer and wealthier countries are better environmental custodians.

Economic growth also reduces fertility and therefore population. As a societies become more technologically advanced, there are fewer "muscle" jobs and more high paying jobs for women. This gives women more power in the home. Meanwhile contraception is becoming more affordable. As technology develops, children move from being a source of cheap labour to a major education expense. For all of these reasons, the United Nations predicts that our population will most likely peak at around nine billion this century, decline slightly, then stabilise. Concerns about overpopulation are now a known quantity.

Altogether the best evidence we have suggests that the future will involve wealthier, healthier people with stable population growth and greater ability to be environmental custodians than at any time in the history of our species. And with that, Merry Christmas. ESR

David Seymour is a senior policy analyst at the Frontier Centre.




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