Prediction 4. We will face declining margins and greater scarcity.

Sure, the human race is on a roll. But can we keep it up?

In my life I’ve run a couple of marathons. To prepare has meant a lot of running. Jogging might be a better term. Come to think of it, you might have to use time lapse photography to be sure I’m moving. Anyway, I’m slow.

So this provides a lot of time to think. And not necessarily under the best of conditions. Occasionally I’m unable to get the following mental picture out of my head – it just keeps rewinding and replaying, over and over. In my mind, I’m running what I think is a half-marathon. I get to what I think is the finish line. But the official says, “Looking good! You only have another 13 miles to go!”

That’s the predicament of the human race. We’ve been on a roll for the past couple of centuries. Growth in our numbers, and improved quality of life. Breathtaking innovation and social change. But suddenly it hits us: there’s no end. We’re on a treadmill. We don’t dare stop. We have to keep changing and innovating. And then we notice. We’re tired, stressed. A bit of doubt creeps in. Maybe we can’t keep this up.

A while back some people coined the term “sustainable development” to describe this. Several definitions are floating around. One comes from the Gro Brundtland report, Our Common Future, which was published in 1987: “Sustainable development is development that meets the needs of the present without compromising the ability of future generations to meet their own needs.”

Sounds nice! This is indeed a great societal goal, but all too often people use this term too cheaply. They confront us with the reality that our current development is anything but sustainable. Well and good! We can and should do better. But at the same time they mislead. They seduce us into thinking “sustainability” is something we can actually achieve. For example, they hint, or encourage us to believe, that if we were to discover and then go about our affairs in some “right” way – reducing our carbon emissions, engaging in a series of “green” practices – the human race could conduct business-as-usual forever. The reality? This view of sustainable development is an oxymoron, no different from the chimerical idea of perpetual motion.

Instead, we can only (and should!) continually work in this direction, but recognize that we can only improve. We will never arrive. Look at nonrenewable resources, for example. Suppose we use platinum or some other strategic mineral to make our society go, and we have one hundred years’ supply left. Each year we either have to get something like one percent more efficient in our use of the platinum remaining, or we have to find a substitute, or both. This leads us to picture a society that uses nothing but renewable resources. But even then we generate waste. So we set about to minimize waste…let’s suppose we got really good at that…then one day (might be billions of years from now) one of our descendants would look up and notice the sun was expiring. In the last analysis, we can never achieve truly “sustainable” development – we can only buy more time, slow our unsustainability. And we can do that only through an unending process of innovation, and only up to a certain point. Fall behind, stumble in this effort – and the game is quickly over. We lose. Sobering? To be sure. But that’s what it means to live on the real world.

This is where our large and growing numbers, and our ever-increasing per-capita use of resources become a problem. Sustainability becomes a far greater challenge as either or both of these numbers grow. Arable land is disappearing worldwide, a consequence of population growth and urbanization. Productivity per remaining acre is increasing, thanks to improved agricultural practice and genetic modification of grains, but this is a continuing race, and it’s not altogether evident at any given time just where the next advance is coming from. Fresh water supplies are strained. The pace of habitat loss and environmental degradation is increasing. Everything is speeding up. We’re finding less time to make each decision, to act. The unintended consequences, the unexpected shortages, emerge more quickly. There’s little room for error, little margin.

And speaking of margin, what margin there is decreasing. It’s ironic. In the developed world, margin is sometimes equated to waste. Take the business world. If my company has operating margin, I could squeeze more out of my investment by taking on more debt, and can and should keep doing so until I squeeze out the last bit of excess fat. Otherwise I’m takeover bait! And inventory? That’s idle capital. Business today is about zero-inventory, just-in-time practices. In the developed world, we’re zero-margin by choice.

In the developing world, zero-margin is also the rule, but for a different reason: it’s forced on developing countries by the developed world. Today, developing countries struggle to stay independent, to feed their own people. But other, richer countries buy up their lands, encourage the developing peoples to use their best farmland to grow crops for export, like coffee and bananas, say, and then feed themselves by farming the poorer, more-marginal soils.

The problem with both these scenarios is that neither rich nor poor nations have the margin or resilience needed to weather hazardous extremes or pollution events – or, for that matter, global financial crises.

This decline in margins and rise in scarcity will not be uniform worldwide. Instead it will be uneven. Pockets of scarcity and want will pop up suddenly here and there, causing misery and suffering (note that this problem presents itself the same way as the hazardous extremes or pollution events do). We see this today. Most readers of this blog enjoy plentiful water supplies near at hand, from not one but several sources: taps, bottled water, and a range of delicious beverages. But the world’s poorest billion may have to walk more than a kilometer to find water safe enough to drink. That kilometer hike ends at a long waiting line working off a trickle from a single faucet – and that trickle is subject to disruption without notice.

So, we face a future of scarcity and declining margins.

Enough! Tell me that’s it! No, there’s one more future challenge. Look for it in the next post.

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3 Responses to Prediction 4. We will face declining margins and greater scarcity.

  1. Lewis Deane says:

    I haven’t finished reading your fascinating post (h/t RP Jnr) but I must comment on your paper thin description of our Ancient forebears – I notice you didn’t mention any mathematicians and, therefore, elided the rapid advances in that subject as documented by Euclid in the Alexandrian and post-Alexandrian period. Eureka!? I know this is not germane to your post but the scientific method was there in germ(!) in the latter days of that period and if it wasn’t for the Convertion of Constantine may have matured much, much earlier. Anyway, just thought I’d say and welcome to the blogosphere. I’ll now carry on reading!

  2. Lewis Deane says:

    Finished now. I don’t find the prospect of ‘social sciences’ (an oxymoron, if there ever was one) mixing in a particularly sanguine prospect! But I’m just steadfastly antiquated 3.0 and proud of it!

  3. Pingback: Placing trillion-dollar bets? How much would you pay to shave the odds? | Living on the Real World

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