One of my goals with this blog was to read The Wealth of Nations, and summarize it. Well, I’m still going to do that, even though I’ve broken off for a bit. It’s not like I’ve done nothing over the last few months. Christmas happened, relatives visited, my math class and principles of macro began. We moved some furniture around and I now have what amounts to an “office” but what is really the result of a wise move by my wife to sequester my clutter into one manageable area, as opposed to having it strewn about the house. I’ve also read Mises’ Economic Policy: Thoughts for Today and Tomorrow, Coase’s The Problem of Social Cost, a goodly portion of Bastiat’s Economic Sophisms and a collection of Henry Hazlitt’s writings entitled The Wisdom of Henry Hazlitt. That isn’t enough reading to solidly occupy two months’ time, but I’ve been distracted by a few things and I’ve been distracting myself by reading things like Steve Horwitz vs. J. Bradford De Long, Tom Palmer vs. Johnathan Chait, and trying to keep up with Scott Sumner, who with this post single-handedly brought me back from the brink of writer’s block-induced despair.
Moving into my new “digs” required me to take stock of the books that I’ve piled up into a defensive cocoon. One of those books is the 2nd edition of Julian Simon’s The Ultimate Resource. Most people who know who Julian Simon is know him because of the famous bet he made with Paul Ehrlich. Julian Simon was a kind of legend to me. Dad told me about his famous wager, but he explained to me what Simon’s winning the wager actually meant: that scarcity is managed and overcome by a free market, and that imagination is the only real limit on the exploitation of finite resources. I read Atlas Shrugged and I, Pencil in high school, and although I never read The Ultimate Resource, the implications of Simon’s wager colored and informed my readings of those books and others.
I’m in the middle of a marathon reading of The Road to Serfdom right now, but I thought I’d break for a minute and reproduce a passage from The Ultimate Resource that I wish I had read twenty years ago:
A conceptual quantity is not finite or infinite in itself. Rather, it is finite or infinite if you make it so–by your own definitions. If you define the subject of discussion suitably, and sufficiently closely so that it can be counted, then it is finite–for example, the money in your wallet or the socks in your top drawer. But without sufficient definition the subject is not finite–for example, the thoughts in your head, the strength of your wish to go to Turkey, your dog’s love for you, the number of points in a one-inch line. You can, of course, develop definitions that will make these quantities finite, which shows that the finiteness inheres in you and your definitions rather than in the money, love or one-inch line themselves. There is no necessity either in logic or in historical trends to state that the supply of any given resource is “finite,” and to do so leads to error.
Someone coined the label “cornucopians” for those who believe that the natural resources are available in practically limitless abundance, to contrast with “doomsters.” But the stream of thought that I represent here is not cornucopian. I do not suggest that nature is limitlessly bountiful. Rather, I suggest that the possibilities in the world are sufficiently great so that with the present state of knowledge–even without the additional knowledge that human imagination and human enterprise will surely develop in the future–we and our descendants can manipulate the elements in such fashion that we can have all the raw materials that we desire at prices ever smaller relative to other goods and to our total incomes. In short, our cornucopia is the human mind and heart, and not a Santa Claus natural environment. So has it been throughout history, and therefore so is it likely to be in the future.”