Are We Running Out of Resources?

Running out of resources has been one of the most influential claims of the early environmental movements, and a claim that provided the background for many of the environmental movements such as; recycling, the argument that small-is-beautiful and the excuse for the need to restructure society away from its obsession of consumption and production. The idea of the world losing its resources at an accelerated rate because of humans, has been very influential over the past 30 years.

This movement is also one of the environmental claims that have been confirmed clearly to be incorrect.However, the scarce of resource reduction gets its run through the media on frequent basis. Many environmentalists today deny their previous claims of the earth’s resource depletion. Are we running out of resources? It is a temporary economic myth. This fear that we will use the Earth’s natural resources has been with us since the industrial revolution. Since the beginning of industrialization, people have feared that as firms use up the Earth’s resources, we would eventually run out of them.

This fear continues today, however this is largely a myth, in fact we are not running out of resources, what we are doing over time is learning to use resources more efficiently and finding substitutes for resources as they do begin to deplete. For example, copper, in the early 1960’s telephone use in the United States was expanding enormously, at the time the only way to carry the data over telephones was over copper wire, so as telephone use began to expand to new parts of the United States, the demand for copper began to rise, as the demand of copper began to rise so did the price.The outcome of this scenario is that people begin to worry we would not have enough copper to wire the entire country for telephone use. However, as we know we managed to get around this problem, how did we get around it? Well two things happened; first as the price of copper began to rise, copper producers found new sources of copper that were previously too expensive to explore, more important we saw the development of substitutes like fiber optic cable, which is made out of sand.Now a day we carry our voice and data through fiber optic cable rather than copper, conserving on the use of copper and providing us with more of the services that copper was delivering.

The graph below demonstrates the steady increase on world production of copper in millions of tons a year, for a hundred years, from 1900 to the year 2000. According to the statistics and research of the International Copper Study Group, “it was demonstrated that in 2002, copper amounted to roughly 15 million tons; in 2011, it is estimated to reach 19. million tons 700,000 tons more than were produced in 2010. It is clear that a 400,000 ton production shortfall would suffice to reduce the LME's stocks of copper to an insignificant level. Obviously, copper users would have every reason to worry about supply and prices would be driven higher accordingly. In 2010, the deficit between the primary (mine) supply and demand of copper was estimated to have been just 250,000 tons and copper's price rose from $3.

40 per pound to $4. 40 per pound during the year”.At increasing rates of production, it was expected that humans where going to extinct many of the Earth’s natural resources, not just copper. According to the U.

S. Geological Survey, known reserve bases of gold will last 31 years; mercury, 80 years; tin, 60 years; zinc, 55 years; petroleum, 44 years; copper, 56 years; lead, 41 years; and natural gas, 65 years. The World Bank calculated that between 1970 and 1996 the average real price of all metals and minerals fell by more than 50 percent. Lower prices mean that resources are becoming more abundant, not scarcer.This were exceptional news for humanity, although it was bad news for Paul Ehrlich. In 1980, so certain was Ehrlich of his predictions of forthcoming exhaustion of resources, that he made a bet with University of Maryland economist Julian Simon.

Ehrlich alleged that the prices of natural resources would rise over the next ten years. Ehrlich himself chose a basket of five metals--chrome, copper, nickel, tin, and tungsten--with a total price of $1,000. If the actual price of the metals were higher than $1,000 in 1990 than in 1980, Simon would pay Ehrlich the difference.If the price fell, Ehrlich would pay Simon. Ten years later, Ehrlich, without comment, sent Simon a check for $576. The real prices of these metals had fallen by more than 50 percent in just ten years.

(Schneider) Prices can be analyzed the following way; prices are an incentive wrapped in knowledge, so when the price of copper or another resource rises, it does two things; it provides the knowledge to producers that signals them, it is time to find a substitute, or is time to find more efficient ways of using the good. Prices not only provide knowledge, they lso provide an incentive, to find substitutes or efficient ways to use the good. At higher prices, new sources of resources become more profitable, as consumers buy the good, substitutes become more profitable as well. If we are really concerned about running out of resources, the answer is not to restrict our use of those resources, but to give the price system and competition in the market economy the maximum play possible to create competitive prices. With the price system, producer will be provided with the knowledge and the incentive they need to economize and to find substitutes as resources begin to get scarcer.

But will we run out of tin in 60 years or copper in 56 years? No. "We do not fear that we are running out of the supply of milk because the grocery store holds only a three-days' supply," notes Cato Institute economist Stephen Moore. "Similarly, we should not expect to run out of copper simply because copper mining companies calculate that they have only a certain number of years of reserves. When they use up those reserves, they will have a renewed incentive to local new sources of supply. ” (Crowley) The whole depletion debate misses a key awareness.Humans use resources as a means to an end, not as an end in themselves.

People don't want oil, they want to cool and heat their homes; they don't want copper telephone lines, they want to communicate quickly and easily with friends, family, and businesses; they don't want paper, they want a convenient and cheap way to store written information. If copper, paper, and other resources become scarce, society will turn to other sources of energy, other methods of communication, and other ways to store information.Viewed from and economist point of view, running out of natural resources starts to look a lot less frightening. Ultimately the wise word of John Cobin, Ph. D.

for The Times Examiner, ties everything together with his wise word; “The only resource that is truly scarce is the human mind, and the wonderful ideas that it develops. Liberal Ideological Environmentalists (LIEs ) and socialists, among other liberal groups, are the predominant threat to humanity and civilization.We must be careful to avoid the tragic pitfalls that their understanding, and instead embrace informed, free-market alternatives. ” (Cobin) Works Cited Cobin, J. , Ph.

D. (2004, September 22). Are we running out of natural resources? [Fact sheet]. Retrieved from The Times Examiner website: http://www. policyofliberty. net/e-books/ Running%20Out%20of%20Resources.

pdf Crowley, B. L. (2011, May 27). The running out of resources myth [Article]. Retrieved July 30, 2011, from National Post Canada website: http://www. republicofmining.

om/2011/05/27/ the-running-out-of-resources-myth-by-brian-lee-crowley-national-post-may-27-2011/ Crowley, B. L. (2011, April 15). Are we running out of natural resources? [Fact sheet]. Retrieved from The Macdonald-Laurier Institute website: http://www.

macdonaldlaurier. ca/files/pdf/ Are-we-running-out-of-natural-resources-Brian-Lee-Crowley. pdf Kiel, K. A. , Matheson, V. A.

, & Golembiewski, K. (2009, July). Luck or skill? An examination of the ehrlich - simon bet [Research paper].Retrieved from College of the holy cross website: http://college. holycross. edu/RePEc/hcx/Kiel-Matheson_EhrlichSimon.

pdf Schneider, J. A. , Ph. D. (n.

d. ). Paul Ehrlich vs. Julian Simon - have we reached the limit? [Fact sheet].

Retrieved from http://www. colorado. edu/geography/class_homepages/geog_1982_f06/ Overpopulation. pdf Tenebrarum, P. (2011, July 5). Understanding gold [Article].

Retrieved July 25, 2011, from Seeking Aplpha website: http://seekingalpha. com/article/277995-understanding-gold