IT’S IMPOSSIBLE TO OVERSTATE DEFLATIONARY PRESSURES:

HOW LAB-GROWN DIAMONDS UPENDED THE INDUSTRY AND COULD END UP CHANGING THE WORLD (Matthew Hart, 6/20/24, CrimerReads)

Rarity is the basement attribute that supports the diamond industry. Without that concept, the whole idea of a jewel is under threat. That threat became real when a virus invaded the sparkling domain of diamonds, destroying the very idea of rarity. The virus was lab-grown diamonds.

Pity the poor Malthusians.

PITY THE POOR MALTHUSIANS:

More People, More Prosperity: The Simon Abundance Index: The Simon Abundance Index 2024 finds Earth’s resources 509% more plentiful than in 1980. (Marian L. Tupy, 22 Apr 2024, Quillette)

Between 1980 and 2023, the average time price of the 50 basic commodities fell by 70.4 percent. For the time required to earn the money to buy one unit of this commodity basket in 1980, you would get 3.38 units in 2023. In other words, your resource abundance increased by 238 percent. Moreover, during this 43-year period, the world’s population grew by 3.6 billion, from 4.4 billion to over 8 billion: an 80.2 percent increase. Given that personal resource abundance grew by 238 percent ((3.38 – 1) x 100) and the population grew by 80.2 percent, we can say that the population-level resource abundance rose by 509.4 percent ((3.38 x 1.802) x 100 – 100). Population-level resource abundance grew at a compound annual rate of 4.3 percent and every 1-percentage-point increase in population corresponded to a 6.35-percentage-point increase in population-level resource abundance (509.4 ÷ 80.2 = 6.35).

NO ONE HAS IT HARDER THAN THEIR FATHER DID:

Thomas Piketty’s Motte and Bailey: Don’t expect new research to convince the egalitarians’ leading ido (Vincent Geloso, Jan 18 2024, City Journal)

To understand the contemporary debate about income inequality, it helps to be familiar with the deceptive rhetorical technique known as the motte-and-bailey. The motte-and-bailey involves a party making a tenuous, radical claim, then redirecting the argument toward a more agreed-upon, defensible claim when challenged on the radical one, only later to return to the tenuous claim. The technique is named for a style of medieval defensive settlements, in which a defensible stone keep (the motte) is situated on a raised earthwork. A courtyard and ditch (the bailey) surround the motte. The motte is the stronger position, while the bailey is the weaker. Defenders retreat to the motte when attacked, then, once the threat has subsided, return to the bailey.

Economist Thomas Piketty and his collaborators Emmanuel Saez and Gabriel Zucman are skilled motte-and-bailey technicians, extending indefensible claims about rising inequality, retreating to agreed-upon facts of social and economic change, and then reclaiming their radical baileys once attacks fade. […]

This radical bailey position is made untenable in three ways. First, my work with Phil Magness, John Moore, and Phil Schlosser (published in Economic Journal and Economic Inquiry) suggests that Piketty was careless in his usage of historical source materials and made numerous important errors in estimating inequality pre-1960. One involved his application of a rough estimation of income, though original sources contained data that could have enabled a more precise calculation. My coauthors and I tried to refine these pre-1960 estimates. Further, Piketty’s work contained significant historical inaccuracies (such as overlooking the exemption of state and local government employees from federal taxes before 1938) and misrepresented several steps in his methodology. We addressed these errors, too. Overall, we discovered that Piketty overstated inequality levels before the 1960s by about 20 percent.

Second, our work in Economic Inquiry showed that most of the levelling in the 1930s occurred as a result of the wiping out of capital gains. Roughly four-fifths of the “golden age” of equality (between 1950 and 1980) owed to the Great Depression, not tax policy. This finding is hard to celebrate because it means that greater equality was achieved while everyone was getting poorer. It also eliminates most of the purported influence of higher tax rates in generating the “golden age” of equality.

Third, the work of Gerald Auten and David Splinter shows that the golden age was not so golden. Once they corrected for how tax policy often encouraged changes in how taxpayers organized their income sources according to corporate or personal identities, they found that inequality started from a higher floor in the 1960s than Piketty and his colleagues presume. They also find a milder increase in inequality since the 1980s.

THERE ARE NO PEAKS:

How Malthus Got It Wrong (David R. Henderson, 1/11/24, Defining Ideas)

Simon, in his book The Ultimate Resource, posited that it was precisely the growth in population that had led to the increased supply of resources. How so? Because, argued Simon, with more people, there were more minds, and with more minds, there were more minds solving problems. That’s what led to his book’s title. People, he argued, were the ultimate scarce resource.

In “Natural Resources,” published in David R. Henderson, ed., The Concise Encyclopedia of Economics, Princeton University economists Sue Anne Batey Blackman and William J. Baumol lay out three ways in which “the effective stocks of a natural resource can be increased.” First, a technological innovation can reduce the amount of waste. They give the example of reducing the amount of iron ore lost in mining or smelting. They also note that improvements in technology can help force more oil out of wells that have been abandoned. Second, they write, there is some substitutability over a wide range of resources. They give the example of insulation, which allowed homeowners and tenants to use less oil. This doesn’t mean that oil became more plentiful, of course. But it does mean that the available supply of oil was stretched so that the awful thing people feared—running out of oil—didn’t happen. The final way they note of increasing resources is to recycle. While some products really should not be recycled because the resource costs of doing so exceed the savings, other resources, like aluminum, can be profitably recycled.

In their article, Blackman and Baumol give some striking data on five minerals: tin, copper, iron ore, lead, and zinc. They show world reserves in 1950, world production between 1950 and 2000, and reserves in 2000. If we were running out of those resources, all of the reserves should have been smaller in 2000 than in 1950. In fact, all were larger. The case of iron ore is the most striking. In 1950, there were 19 billion metric tons. Between 1950 and 2000, 37.6 billion metric tons of iron ore were produced, which was more than the number of tons to begin with. By 2000, world reserves were 140 billion metric tons, over seven times as many as in 1950!

Earlier similar data caused Julian Simon to conclude that the real constraint on resource availability was not resources but people.

PITY THE POOR MALTHUSIANS:

Twilight of the Floating Idol: On Anthony Galluzzo’s “Against the Vortex”: a review of Against the Vortex: “Zardoz” and Degrowth Utopias in the Seventies and Today by Anthony Galluzzo ( Jordan S. Carroll, December 8, 2023, LA Review of Books)

As Galluzzo persuasively argues, Zardoz allegorizes the Malthusian panics of the late 1960s and ’70s. Paul R. Ehrlich’s 1968 bestseller The Population Bomb suggested that looming environmental catastrophe demanded the intervention of experts who could figure out ways to force people in poorer nations to adopt stringent birth control measures. The Immortals in Zardoz embody this vision of ecological balance achieved through totalitarian technocratic intervention. Indeed, Galluzzo observes that the Immortals live in what turns out to be a grounded interplanetary vessel, a literalization of Buckminster Fuller’s Spaceship Earth. The Immortals’ sustainable world is an enclosed system in which everything is monitored and controlled by an advanced computer.

This “hippie modernist” utopia depends on the violent exclusion and exploitation of the rest of the human population. Here Galluzzo draws a connection to the ecofascism of Garrett Hardin, who argued that well-provisioned First World nations should ride out the coming ecological collapse by hardening their borders against refugees, allowing the rest of the planet to die. This is precisely what the Immortals have done. For their part, the Brutals represent what Ehrlich would term a “death rate solution” to the issue of excess birth rates. The Immortals have invented a false religion to convince the Brutals to do their bidding: one of them pilots a giant floating head called Zardoz that booms, “The gun is good! The penis is evil!” before showering the Brutals with small arms to exterminate the planet’s surplus population.

Wealth never peaks.