Economics 101 and the Coming Famine

By David L. Brown

There is growing concern about the building “silent tsunami” of famine (as The Economist calls it). One response is to spend more money to provide food for the hungry poor, but that ignores the fact that the problem is not lack of money but shortages of food. Another predictable response takes the form of calls for more research into how to grow more crops, presenting the expectation that we can repeat the Green Revolution. An article in the latest issue of Science decries budget cuts in funding for agricultural research, with the implication that if only we could spend more money there the problems of food shortages would go away.

Well, that may have been true in the past when researchers were able to launch the so-called Green Revolution. The GR rode on the back of abundant and cheap natural resources. It was not and never could have been a permanent solution to the problem of feeding humanity, because while human numbers continued to grow higher, the resources of the Earth are finite and being rapidly depleted.

That was then and this is now, and the Law of Diminishing Returns assures that history cannot be expected to repeat; there will be no Green Revolution Redux. A similar economic fact is colloquially known as “TANSTAFL,” an acronym for There Ain’t No Such Thing As A Free Lunch, a lesson we are beginning to see demonstrated in the real world of actual economics.

Unfortunately, the Green Revolution was a one-shot deal and any follow-up effort will of necessity be a far more expensive and less productive process. It will not be “deja vu all over again” as Yogi Berra so famously stated.

There are a lot of reasons why there can be no new Green Revolution, at least not in any way that is comparable to the original. For one thing, the world population has approximately doubled since the Green Revolution began. For another, the world’s resources of land, water, minerals and energy have been reduced and are becoming more expensive thanks to the law of supply and demand.

The Law of Diminishing Returns was ironically pioneered by, among others, Thomas Malthus, a leading economist of the 18th and early 19th century. He and David Ricardo laid the groundwork for this concept. Here is what the Wikipedia says about this:

Malthus and Ricardo … were worried that land, a factor of production in limited supply, would lead to diminishing returns. In order to increase output from agriculture, farmers would have to farm less fertile land or farm with more intensive production methods. In both cases, the returns from agriculture would diminish over time, causing Malthus and Ricardo to predict population would outstrip the capacity of land to produce, causing a Malthusian catastrophe.

Well, as you can see, the Law of Diminishing Returns has its roots right in the heart of the subject that is of serious concern today. The term “Malthusian catastrophe” refers to the well-known prediction by Malthus that human numbers would someday outstrip potential food production. That is what we are witnessing today.

But the situation is even more serious than even the dour Malthus foresaw. He knew nothing of the future science that would create the Green Revolution, nor did he understand the principle of Overshoot-and-Collapse, predict the coming of industrial agriculture, or anticipate that modern medicine would place population growth on a rapid increase. All of these factors have combined to cause world population to spike upward even as resources are dwindling. That has left us hanging over a cliff like Wile E. Coyote, looking into an abyss.

[For more on these subjects you may want to read the following essays on this site: “The Malthusian Conundrum,” posted July 8, 2006; “Revisiting a Classic: Ehrlich”s ‘Population Bomb,” from July 15, 2006; “Overshoot-and-Collapse: A Model for Our Future?” from August 6, 2006, and “Malthus’s Classic ‘Essay on Population’ Revisited” from October 29, 2006. You can use the search field at upper right to find these and other articles on related subjects.]

The diminishing returns law applies to almost every phase of the problem we face. For example, look at the subject of tillable land. For generations humans have broken up native prairies, cut down forests, and drained swamps to bring more land into agricultural production. The process is still going on in places like the Amazon and Indonesian rain forests. But at the same time, the amount of productive land has been disappearing, beneath housing tracts, highways, and parking lots, as well as through the process of erosion by wind and water. As Malthus told us, there are hard and fast limits to the number of acres that can be brought into agricultural production, while human numbers can keep rising geometrically.

Look at the situation for water, an equally important ingredient for growing crops. Everywhere, water shortages are looming. Ancient aquifers such as the Ogalalla that lies under the High Plains region from Texas to the Dakotas are being “mined” from the Earth and will soon be gone. Global warming is melting glaciers and reducing runoff from winter snowpack, causing streams to dwindle at the peak of the growing season in many regions from America to China to India to Europe. Again, diminishing returns.

And another vital element in industrial agriculture is energy, in particular petroleum and natural gas, which are used not only to power farm machinery but also to dry crops for storage, transport food and supplies to and from the farms, and as the feedstocks for the production of agrochemicals and fertilizer. Without cheap and abundant energy there can be no cheap and abundant food — a lesson the world is just beginning to learn.

And consider too that industrial agriculture has led us to a place where only a few genetically similar crops provide the vast bulk of the world’s food supply. The practice of monoculture leaves crops open to the danger of disease such as the leaf wilt that caused the Irish Potato Famine. In fact, the spreading threat of a nasty plant virus called UG99 is sweeping into the Asian wheat belt right now. It is a devastating disease that can kill entire wheat crops and about which nothing can apparently be done in the short term (See my article “Ugly Times Ahead as Death Spores Spread,” posted here March 19, 2008.)

Put it all together and it is easy to see that no scientific solutions are likely to provide a silver bullet solution to the prospects for widespread famine. No matter what we might do to stimulate plants to grow faster and produce more, the limitations of soil, water, energy and everything else that Nature requires can only do so much. It may be a harsh fact, but it is true nonetheless that food will never again be cheap or plentiful. That fact bodes very ill for the poorest humans who are already living on the edge of famine.

In the future, only highly intensive practices such as small rooftop gardens, hydroponics, and perhaps some forms of synthesis will be able to marginally add to the world’s food supply. The need will be for more human labor and less reliance on mechanical farming; more use of recycled waste and less of chemical fertilizer; more personal attention to the basic need of human beings to feed themselves, and I don’t mean by driving off to the Supermarket in an SUV or wheeling into the nearest McDonald’s.

Truly we are entering into an era in which there will be no easy solutions such as we have tapped in the past, and which have had only the questionable result of moving the human Overshoot further ahead into dangerous regions. Now, the principles of TANSTAFL and diminishing returns are coming into the fore and disaster is inevitable. There is no amount of money — whether spent in support of agricultural research that cannot yield the effects of the Green Revolution of the past, or to buy food for the starving — that will solve the problem. The Overshoot is nearly complete, and the Collapse is beginning now.

Malthus and Ehrlich have been demonized, but their predictions are beginning to come true. Disaster is crashing down upon the Earth like a freight train loaded with plutonium, and thanks to the cold laws of economics, the “dismal science,” we must prepare for some very dismal times indeed.

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