Sunday, April 5, 2015

Resources are running out and so is the time! A (very late) response to a Wall Street Journal Article.

In April 2014, Himanshu Shekhar, Roy Cohen and I wrote a response to the article written by Matt Ridley in the Wall Street Journal. The response was sent to and fro across continents, but then life happened (to all of us) and unfortunately the response was never shaped, finalised, and sent off. In the spirit that late is better than never, I have decided to at least publish our response here: 

This article is a direct response to the article “The World’s Resources are not running out” by Mr. Matt Ridley and published online on the Wall Street Journal (dated April 25, 2014, The first half of this response aims to highlight the conceptual flaws in arguments presented by Mr. Ridley while the second half responds more empirically (to various points raised by Mr. Ridley).

Overall, Mr. Ridley’s arguments focus on the notion of technological advancement as the solution for resource scarcity, without discussing the merits and demerits of these “solutions”. This is a very partial and exclusive point of view, which can only be assumed by privileged individuals. According to advocates like Mr. Ridley, advancement in technology will provide alternatives before we run out of present resources. However, this approach ignores the greater processes that inform technological development.

The way our system currently runs, technological development meets the needs of the market. These are dictated solely by profit: investors put their money in technologies that, in their opinion, could scale up and have great returns on investment. Investments in eco-friendly technologies exist but--in the current system--no “green” technology can hope to have the same success as e.g. WhatsApp, a texting app for mobile phones that was purchased for 16 billion USD by Facebook.

Another systemic problem is that the initial cost of investment rises with the increasing sophistication of technology. A self-proclaimed rational optimist, Mr. Ridley fails to see how corporate-patented technologies are used to centralize production. In the agricultural sector, for instance, four firms control more than 85% of beef production in the USA. Small farmers are marginalized and systematically exploited by these corporations (one only has to go to various case studies in Africa to see how this has corroded small scale farming). Many poor countries are forced to be the food basket of the world while the western world keeps more lucrative and remunerative areas such as the service sector for itself. Imbalances in trade and in access to technology further deepen the gap between rich and poor. Technology itself is not “good” or “bad”: it is oblivious when it is being used to aggravate social inequality as well as the climate crisis.

Like many people who share his point of view, Mr. Ridley cites rising efficiency in production as an example for the promise of technology. But it is a biased perspective, which leaves out two other important factors: (1) imports that increase the global footprint (pollution); and (2) the rise in affluence, which increases per capita consumption.

Mr. Ridley further talks about failure of predictions made in the renowned book “Limits to Growth” by the Club of Rome, which — according to Ridley — failed when it predicted that resources will run out by now. But in fact, what the book failed to predict is the widening gap in resource consumption between rich and poor. This gap has been a blessing in disguise, to some extent, in ecological terms, but it indicates that more than half of the people in the world cannot meet their basic needs. In countries such as China, which witnessed the arrival of a strong middle class, the overall consumption has observed multi-fold increase putting extreme pressure on resources. The writers of Limits of Growth foresaw a trend in many of their projections. Their book sparked a revolution in how we value progress, and an awareness of the climate crisis, which Mr. Ridley wants to peg as a purely technological question. But the reality is much more complicated: the values that inform technological development determine what kind of world we are creating with the tools of progress.

Indeed we are hitting resource limits and planetary boundaries as we speak. Ecosystems are collapsing. The global water cycle is disrupted due to massive deforestation in the Amazon forest, which now releases more carbon than it soaks up. The acidifying oceans risk ending life as we know it. At what cost is our system currently operating? Developing economies are aiming for the same unsustainable goal as the developed world – industrializing by logging huge forests for timber, rather than using them for ecotourism or protecting them for the communities who depend on them for their livelihood. Two billion people are starving, with another billion people on the verge of starving – and one billion people are obese. Mr. Ridley’s so-called rational optimism does not account for these statistics.

Furthermore, the British member of the House of Lords talks about pessimists and optimists of climate change. Optimists hope for technological change that would result in the use of lower-carbon energy. However, climate negotiations show us that we are nowhere near. Climate activists  and other sustainability actors are pushing for renewable energy, but oil giants still yield more power than governments. The 2008 financial crisis had Exxon, Shell, Chevron reduce their US workforce by 11,400 workers, but — on the backend — pocketed 4 billion a year in tax subsidies. Globally, subsidies to the fossil fuel industry top 550 billion USD every year and are at least 12 times any subsidies given to energy efficiency and renewable energy. In 2011 Exxon made 5 million USD profit every hour but paid lower taxes than the average American worker.  This is not exactly a conducive enabling environment for more informed technologies.

Ecologists in this sense are not pessimists. They are realists who are pushing for redefining our approach to the entire system so that we do not chase endless growth at our own peril – but instead reduce inequality and work towards the well-being of humans, as well as the ecological health of our planet on which we rely for our own survival.

We have no doubt that innovation is part of the solution. Technology is part of the solution. But where Mr. Ridley fails is in seeing what innovation and technology serve. His narrative for progress is imbued with old fashioned ideas about increased productivity — the same ideas that have brought about the ecological crisis that we are experiencing. But innovation and technology can only help us get out of this crisis if we use them to solve our real, urgent problems — finite resources, unequal distribution and - yes - the climate crisis. It will not magically dissolve.

Resources are running out despite advancement in technology. Access and affordability to technology are as important as the tools we develop. Unless every single human being has sufficient access to basic resources, the pressure on the resources will keep on mounting. Any discussion on resource exploitation without considering the time needed for their replenishment and their impacts on the environment is nothing short of suicidal for the sustenance of the human race. Indeed, present accounting systems and the financial systems are not supportive of a sustainable human society. Our system, by design, erodes into our resources. A redefinition of our value system would help steer innovation towards a more just and equal society, one that lives in harmony within the larger system.  We hope that the leaders, policy makers and people in general will pay heed to Mahatma Gandhi’s words: “There is enough for everyone’s need but not for anyone’s greed”.