The bet; food is where the action is

Just back from walking to dog and listening to Planet Money's latest podcast A Bet On The Future Of Humanity. In 1980 economist Julian Simon bet biologist Paul Ehrlich that the price of a basket of metals would go down over the next decade. Ehrlich lost, with repercussions still being felt in today's highly polarised discussions about what, if anything, we need to do to ensure a decent future. As it happens, I remember the bet clearly.

Planet Money covered the story and spoke to Paul Sabin, a historian at Yale University, who has written a book about the bet, and did so well. Simon died in 1998, but Planet Money caught up with Ehrlich, now 81, who was delightfully unrepentant. What had he learned? "Not to bet." And yet, Planet Money didn't mention another bet, on the price of timber, which Simon lost.

That the bet was about a living resource is important. I've long wondered why Ehrlich was willing to accept a relatively short-run bet on the price of metals, which are, as the programme pointed out, eminently substitutable. What about a bet on primary productivity? There was brief mention of the Sun, but on Simon's side, to the effect that we can never run out of energy as long as we have sunshine.

That may well eventually become true for the energy we need to power machines and the like, but what about energy for the human machine? I bleat on about this, I know, but it remains the point that most economic optimists just don't get. The conversion of sunlight to food we can eat -- without further degrading the environment -- is going to be the challenge of the next decade and beyond.

Wanna bet?