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January 04, 2008

Intellectual Hysteria
by Bob Hoye

The title Intellectual Hysteria may seem like a non-sequiter. Regretably it is not, and starting with Thomas Malthus at the end of the 1700s, there have been some outstanding examples of otherwise introspective intellectuals becoming high-profile preachers of doom and gloom. Malthus provides the first well-documented example and his case was that social catastrophe would be due to a shortage of food. On the next eruption of catastrophic visions in the 1860s it was a looming shortage of coal.

These as well as subsequent manias about disaster have had much in common. Each started with personal revelations by a charismatic intellectual. What's more, each has occurred during the build-up of social tensions common to every period of soaring prices. Although the specific "cause" of pending calamity has changed over the centuries, the generally perceived problem has been and is too many people. That is despite the very long trend of generally increasing prosperity and population.

Fortunately, each phase of soaring commodities, social tensions and stressed-out intellectuals eventually has ended. Unfortunately, the latter excesses are too soon forgotten, which permits the next phase of revelations to seem fresh enough to inspire flocks of new believers.

The term "Malthusian Catharsus" could also be used with the implication that the phenomenon is highly emotional, has a climax, and as with commodities records a long rest before the next eruption of catastrophic inanities.

Malthus remains the model and rather than paraphrasing the message delivered on each example, it is more effective to use the direct quotation. All are vivid, and some remarkably similar.

Recent detractors of his population theory that most of mankind was going to starve to death have described him as Parson Malthus, but he was an eminently qualified intellectual. After majoring in mathematics, he became Britain's first professor of political economy with stature sufficient, and to use a today's term, to set the chattering classes agog with grave concerns about the course of humanity.

His famous theory was that population grows relentlessly at a geometric pace, while unfortunately increases in food-supply were growing at only an arithmetic rate.

Malthus observed "The power of population is so superior to the power of the earth to produce subsistence for man, that premature death must in some shape or other visit the human race."

The conclusion was that measures to restrict population growth must be imposed.

His An Essay on the Principle of Population was published in 1798. That phase of soaring prices and accumulating social distress ran for a generation. The French Revolution and the Napoleonic period attest to the degree of distress. Goethe summed up the corruption of the times with:

"Most men only care for science so far as they get a living by it, but they will worship error when it affords them a subsistence."

The next phase of soaring commodities culminated with the disorders as represented by the U. S. Civil War.

Generally, prices had been increasing since the mid 1840s and reached a peak in the mid 1860s, and was accompanied by growing concerns that coal supplies would be exhausted.
With outstanding credentials, Stanley Jevons became the guru of the age. Having earned degrees in science and logic he became one of the important economists of the 19th century. Widespread fame was acquired in popularizing fears about failing coal supplies.

His equivalent to today's concerns about "Peak Oil" was published in a book The Coal Question in 1865, and a few quotations vividly record grave concerns.

It is important to note that coal was the main energy source during that era, and to quote Jevons:

"With coal almost any feat is possible or easy; without it we are thrown into the laborious poverty of early times."

The impatience of his persuasion is shown with "I am convinced that this question must be before long force itself upon our attention with painful urgency."

Then he flatters his readers with "This is a question of almost religious importance which needs the separate study and determination of every intelligent person."

And as with Malthus the cause of concern was too much population for a diminishing amount of resources. One solution was population reduction.

The next major surge in consumer prices to 1920 was associated with remarkable political conflict, and untempered intellectual speculation. The prime example was the Russian Revolution under the leadership of Lenin. The main theme didn't assume that there were too many people on earth, but that all of them under the Communist International needed to be controlled by a dictatorship.

Ironically, the result of the most intense social experiment in history to create the "new man" was the political murder of some 100 million undesirables. This was from an intelligentsia that was oddly unconcerned about overpopulation. Another contrast with previous and future urgent apostles of pending catastrophe, the communists promised "heaven on earth", but delivered a nightmare.

The next secular rise in prices didn't begin to excite politics until the late 1960s, when Paul Ehrlich became so passionate about his revelations about food shortages. In what now must be a collector's item, the New Scientist of December 1967, Ehrlich wrote "India couldn't possibly feed two hundred million more people by 1980." To which he added, "I have yet to meet anyone familiar with the situation who thinks that India will be self-sufficient in food by 1980."

It is interesting that a scientist would turn to a consensus of conventional wisdom to make his point, and then even worse he resorted to dogma and declared "The battle to feed humanity is over."

"Global Cooling" became the next mantra of anxious intellectuals, as well as those whose ambition was to sell books. Social catastrophe was the general product, cooling was the specific threat.

"If [cooling] continues and no strong action is taken, it will cause world famine, and world chaos, and this could all come about by the year 2000."

This extrapolation of personal revelation was recorded by Lowell Ponte in his book The Cooling, published in 1975. Granted, temperatures had been declining since the 1930s but the extrapolations were sensational.

Another example was "The threat of a new ice age must now stand alongside nuclear war as a likely source of wholesale death and misery for mankind." The author was Nigel Calder in the June, 1975 edition of International Wildlife.

Then prices carried the rate of inflation up to 1980, which at 14% was the highest ever recorded in the long history of the senior economy. With the subsequent long decline in real commodity prices the left's anxieties focused on the scariness of "Cowboy" Reagan and the era of "Greed", leaving little energy for specific nightmare scenarios. Typically, the political consensus turns back to the center during post-boom contractions, and one of the most important political events has been the reform that was symbolized by the fall of the Berlin Wall in 1989.

This was a global movement that definitely curbed the ability to directly promote socialist central planning as the means of political control. Authoritarians turned to the climate. With the boom that began in the mid 1990s, the politically ambitious found new vitality with the new gospels of "Global Warming" and "Climate Change".

Urgency helps to get the message across, as Elizabeth Kolbert used in an article in the New Yorker of April 25, 2005. "The problem is that, once global warming is something that most people can feel, it will be too late to prevent catastrophic change."

This is remarkably similar to Ehrlich's claim that "the battle is over" with the 1970s intellectual fad about food shortages. Not only has India since accomplished food self sufficiency by sidestepping a stultifying bureaucracy it boasts some 160 million ranked as productive middle class.

As the outstanding huckster of this revival of undisciplined intellectualism, Al Gore has been accorded an Academy Award and a Nobel Peace Prize, but some of his claims rank of demagoguery used during previous outbreaks of Malthusian manias.

"[Global warming] threatens the future of human civilization."

This is the big threat and skeptics are condemned as heretics with:

"The debate is over! There's no longer any debate in the scientific community."

The link between existential guilt and global warming is purported to be modern society's output of carbon. While the main greenhouse gas continues to be water vapor, carbon deemed as the culprit, despite occurring in the atmosphere in amounts best measured in parts per million.

The other physical aspect of carbon is that there has been no correlation between the amount of carbon in the atmosphere and the long history of climate change. Nada.

Another blunder is a failure in logic, which is the primitive syllogism that insists that because two things occur at the same time they are causally related. The old "roosters and sunrise" story. This time around it is too many people living the modern life.

Beyond this, there is an important item in the philosophy of science is that any theory about warming is that it must be able to explain all warm periods in the long history of climate change. This would include the current interglacial that began some 12,000 years ago, as well as the medieval warming within which temps until around 1300 were as warm as recent.

However, the main issue of this essay is to review the history of some intellectuals and political demagogues in promoting catastrophic warnings attributed to too much population growth. The earliest well-documented one was the grave concern that was revealed to Malthus, and like subsequent examples the mania occurred with the social tensions that are part of soaring prices.

The outstanding examples of such booms occurred in the early 1800s, the mid 1860s, the early 1900s, as well as over the past 30 years. Each had its champion of social catastrophe, and although the prime cause of concern has changed from just plain starvation to climate change, the common issue has been too many people. The exception is the monstrous irony that the international socialists, who wanted the most people under their control did the best in actually reducing population.

Perhaps contrived theories about excessive population have been the ultimate in social diseases, but the harm that population growth does to people seems unfounded. Well, it keeps growing and its prosperity has always been proportionate to the degree of freedom, and inversely proportional to central control.

The numbers are interesting. At the time of the first Malthusian mania the world's population, as estimated by the United Nations, amounted to 978,000,000. By the 1860s promotion about grave concerns that civilization would collapse as coal production failed the count had reached 1,262,000,000 souls.

The current number is about 6 billion and the degree of prosperity, living standards and mortality rates have been the best in history and continue to improve.

The total amount is the macro approach, and it is worth reviewing on the micro level, which deals with population density. If growth is bad, density must be worse.

The initiative of prosperity and the funds to finance innovation have always occurred in the towns, which were so important to the decline of authoritarian feudalism. Beginning in the 13th century in Northern Europe, the rule was that if a serf had the initiative to break away from the manor, and established himself as self-sufficient in a town for a year he became a free man.

Towns grew to become cities and under an exceptional regime of political and economic freedom, Antwerp and then Amsterdam became the financial and commercial center of the world. These cities were crowded and enjoyed an unprecedented individual prosperity, demonstrating the benefits of population density. Through market forces, the financial center eventually moved to London and New York.

Fortunately, prosperity has had a long history of surviving not just its own financial excesses, but also it has been inevitably resistant to promotions of authoritarian control, no matter how charismatic the message or messenger. The current boom in business, commodities, and finance, by stages has reached a climax and is starting to unwind. And as any veteran of the financial markets would observe, "So long as the price is going up the public will believe the most preposterous story". Once an unsustainable level of conviction has been accomplished any loss of momentum takes the "story" down, and the loss of belief can be shockingly fast.

Great intellectual fads have advanced with a boom and evaporated with the consequent contraction. That the promotion of global warming achieved a remarkable level of belief with equally intense beliefs about various asset classes is not coincidental, but seems to be the way that history works.

The Sixteenth Century was the previous century to suffer a relentless experiment in authoritarian government, financed by equally relentless currency depreciation, and accompanied by propaganda about the wisdom of central control. Two important superstitions employed from time to time were astrology and alchemy. With the subsequent long political reform, the evolution of disciplined scientific inquiry gradually turned these into astronomy and chemistry.

The proper methods of science are well established and the data base on climate history is extensive - as is the understanding of the comings and goings of ice ages. On a more detailed approach, the mechanism of the major changes in warming and cooling over just the past thousand years has been well understood before the mania about global warming brewed up.

The understanding of the physics of the earth's climate will continue to advance under a disciplined, rather than hysterical approach. Convictions about man-made global warming will soon be ranked with convictions about astrology and alchemy.

Bob Hoye
Institutional Advisors

The opinions in this report are solely those of the author. The information herein was obtained from various sources; however we do not guarantee its accuracy or completeness. This research report is prepared for general circulation and is circulated for general information only. It does not have regard to the specific investment objectives, financial situation and the particular needs of any specific person who may receive this report. Investors should seek financial advice regarding the appropriateness of investing in any securities or investment strategies discussed or recommended in this report and should understand that statements regarding future prospects may not be realized. Investors should note that income from such securities, if any, may fluctuate and that each securitys price or value may rise or fall. Accordingly, investors may receive back less than originally invested. Past performance is not necessarily a guide to future performance.

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Copyright © 2003-2008 Bob Hoye

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