Caplan frames his piece around Julian Simon’s argument that people are the ultimate resource and that increased population is a good thing. He suggests that decreasing fertility should be worrying for those who believe Simon’s argument and he makes a case for libertarian approaches to increasing population (I should note that as Caplan seems to be an optimist, this worry is probably not a case of foreseeing impending doom, but a suggestion that things could be even better).
I’ll comment on Caplan’s general argument in another post, but, the first thing that struck me about Caplan’s piece was that I cannot recall another example of Julian Simon being referenced in support of an argument suggesting that there is a problem (that is, beyond arguments that government intervention is a problem). Simon is a favourite source of those who suggest we don’t need to worry about environmental degradation or human living conditions and, as Simon has shown, human living conditions over the last 200 years have invariably trended up.
Despite the manner in which Simon is usually quoted, Simon’s position was not that we never need to worry. As the following quote in Scarcity or Abundance: A Debate of the Environment suggests, worry is one of the mechanisms that solves problems:
Let me correct a misapprehension. I have never said that we don’t need to worry about anything. We need to worry about everything, in the same sense that you had to worry whether you’d get here on time, whether there’ll be enough food in your kitchen for next week, and so on. The world needs the best effort of all of us. I’m saying that the result of all this worry – and of your constructive work, of your throwing your life into trying to do good things for the world and for other people – is that on balance you will create more than you will use in your lifetime, and you will leave the world a little better than before, on average. So, while we all need to worry, we can forecast that the result of all the worries will be that we will wind up better off than we are now.
I don’t preach complacency. And certainly in my own life I don’t think you’ll find complacency. We have to struggle like the dickens. But we’ll win, we’ll overcome.
Simon’s statement describes a situation similar to the operation of the efficient market hypothesis, which in the semi-strong form suggests that fundamental analysis is of no use as current market prices reflect all publicly available information. If everyone believed that was true, no-one would spend effort trying to earn excess returns, which is what causes prices to reflect the publicly available information. The hypothesis is more likely to be true if some people do not believe it. Similarly, Simon’s argument suggests that one of the reasons we do not need to worry is because we worry.
On that count, Caplan’s concern might sit comfortably with Simon’s view, and Simon might have worried about declining population growth. But as for what action Simon would recommend, I am not so sure.
Update: I found a second Simon quote that I was looking for when I initially wrote this post – from The Ultimate Resource 2:
Of course progress does not come about automatically. And my message certainly is not one of complacency, though anyone who predicts reduced scarcity of resources has always drawn that label. In this I agree with the doomsayers – that our world needs the best efforts of all humanity to improve our lot. I part company with them in that they expect us to come to a bad end despite the efforts we make, whereas I expect a continuation of successful efforts. And I believe that their message is self-fulfilling, because if you expect your efforts to fail because of inexorable natural limits, then you are likely to feel resigned, and therefore to literally resign. But if you recognize the possibility – in fact the probability – of success, you can tap large reservoirs of energy and enthusiasm.