The pursuit of self-interest and the insatiability of human desires and needs are not the problem. Rather they are the solution provided by a supremely adaptable species to the challenge of survival. Thus I argue in the first two posts listed at the bottom of this article. For a case in point consider ...
The Mineral Paradox
Mineral resources, not synthetically producible in human time frames,1 are fixed in the earth. As each is mined, less supply remains, suggesting that cost and, thus, price must increase as production cumulates.
Yet, for virtually all minerals, the opposite seems to be true: As more is mined, more is discovered to be mined. Prices and costs do not inexorably rise. What was high-cost yesterday has become lower-cost, undercutting the perennial complaint that “the easy stuff has been found.” Overall, there seems to be little difference between minerals and general goods and services.
Solving the Mineral Paradox
[R]esources are not known, fixed things; they are what humans employ to service wants at a given time. Human “appraisal” turns the “neutral stuff” of the earth into resources. What are resources today may not be tomorrow, and vice versa.8
Resources are highly dynamic functional concepts; they are not, they become, they evolve out of the triune interaction of nature, man, and culture, in which nature sets outer limits, but man and culture are largely responsible for the portion of physical totality that is made available for human use.9
Zimmermann concluded: “Knowledge is truly the mother of all resources.”10
The functional or real-world theory clearly distinguished between the natural scientific and social scientific views of resources. “To the physicist the law of the conservation of matter and energy is basic,” Zimmermann stated. “The economist, however, is less interested in the totality of the supply than in its availability.”11 He warned: “To those who are used to view resources as material fixtures of physical nature, this functional interpretation of resources must seem disconcerting” because “it robs the resource concept of its concreteness and turns it into an elusive vapor.”12
Physical to functional; objective to subjective; absolute to relative; static to dynamic; one- to multi-dimensional: Orthodox economists ignored the real world in their quest to remake their discipline into a “hard” science based on mathematical relationships. Economists embraced deterministic ideas of known, fixed resources that enabled them to calculate the “optimal” extraction rate of a “depletable” resource.13
But this determinism came at the expense of understanding the dynamic nature of real-world resources. This explains why, time and again, economists have fallen short of finding a “depletion signal” in the empirical record, breeding false worries about “peak oil” or peak minerals in general.
Back in the 1970s, Hotelling’s framework captured the thinking of the economics profession and policymakers. “We have a classic Malthusian case of exponential growth against a finite source,” stated economist and Department of Energy secretary James Schlesinger. “[I]n five years’ time we may have chewed up most of the possibility of further expansion of oil production.”