A Child Comes With His Own Bread

The main inspiration for the title of this essay—and the basis of my argument—comes from a Romanian proverb, “copilul vine cu pâinea lui.” My purpose is not to correct Professor Oreskes’s claim, per se. Rather, it is to address Oreskes’s assertion that she attributes to Julian Simon as representative of a popular misunderstanding in Simon’s argument, and therefore to render explicit what is incomplete in Oreskes’s claim. While the selection of this title—and the proverb to which it is related—may seem not only unusual but consistent with Oreske’s claim, it is indirectly motivated by a caption in the original edition of Ehrlich’s book, which states the following: “While you are reading these words four people will have died from starvation. Most of them children.” While this dire prediction has proven to be wrong, as even Professor Oreskes admits, does this automatically vindicate Julian Simon? The answer is admittedly “no,” but not because Simon was wrong. Rather, as I argue in a recent article (Candela, 2022), the reason is because neither Simon’s proponents nor his critics have captured the full essence of what Simon had argued in The Ultimate Resource (1981). By unpacking the proverb invoked here, we can also unpack what Julian Simon had argued.

All proverbs, like the one being used here, contain folk wisdom that is not to be taken literally. Rather, it is meant to illustrate a subtle yet important lesson. Children of course do not spring from their mother’s womb with a loaf of bread. Rather, as all parents know well, the birth of children introduces a scarcity of resources, since they are born into the world entirely as demanders of resources. On a global scale, this indeed magnifies the problem. However, the point that the proverb is meant to impart, as all Romanians well know—and indicative of Julian Simon’s entire point—is that there is both a supply side as well as demand side to bearing children. The birth of children prompts parents to work harder, conserve resources, and learn how to consume more with their children, given the scarcity of the most precious commodity: time itself.

Though not writing in the context of population and resource economics, Gary Becker (1965) had been prescient to the fact that, given the scarcity of time, greater income and wealth would prompt families—particularly as women have entered the workforce—to increase their expenditures not by having more children, but spending more per child. However, nothing about this process is automatic. It is only because of an increasing scarcity of resources in the short run that human beings learn and discover how to supply additional resources to meet a growing population in the long run. The world is not endowed with an infinite supply of natural resources any more than a child is literally born with his or her own bread. Without human beings applying their creativity, there are no natural resources to speak of, just as in the proverb there is no bread to speak of without the birth of a child. Rather, human beings are prompted to discover natural resources by applying their energy and ingenuity precisely because increasing scarcity arises, just as when children are born completely dependent on their parents. Consider this neglected passage in The Ultimate Resource (1981), which captures Simon’s main argument:

• More people, and increased income, cause resources to become more scarce in the short run. Heightened scarcity causes prices to rise. The higher prices present opportunity and prompt investors and entrepreneurs to search for solutions. Many fail in the search, at cost to themselves. But in a free society, solutions are eventually found. And in the long run the new developments leave us better off than if the problems had not arisen. That is, prices eventually become lower than before the increased scarcity occurred (emphasis original; Simon, 1981 [1996], p. 59).

Consider also, for example, the commercial application of kerosene for illumination and heating that had been driven by the discovery of petroleum, from which kerosene is produced. While indeed petroleum may have existed physically speaking, the concept of a natural resource is an economic one, precisely because the scarcity that accompanies its discovery comes from its physical form having competing human uses. Therefore, without human discovery, there is no natural resource to speak of. Pushing this point to its logical conclusion, a declining population would imply a reduction of natural resources, not the opposite as critics of Simon would suggest. Why? Returning to the example, what prompted the introduction of kerosene in the first place was the fact that an increasing scarcity of whales for various commercial uses had driven the price of whale oil up. The rise in the relative price of whale oil incentivized entrepreneurs, such as John D. Rockefeller, to discover substitutes for whaling oil.

This raises a secondary, yet related, point raised by Oreske: “Let populations grow alongside markets operating under minimal government constraints, and people will invent solutions to whatever problems they face.” Julian Simon no doubt was a proponent of economic freedom. This being said, Oreske’s claim requires unpacking since it would be unfair to attribute such a claim directly to Simon. Why? Because Simon himself, at least explicitly, made no direct claims about the causal relationship between economic freedom, population growth, and economic development.

As Simon states, a “key characteristic of a wealthy society is a well-developed set of rules. Wealth both creates such rules and depends upon them to produce the conditions of freedom and security that progress requires. This subject is not developed in this volume” (emphasis added; 1981 [1996], p. 13). As I have argued elsewhere (Candela, 2022), Simon implicitly provides a basis for understanding increases in both human population and economic growth as by-products of economic freedom. The causal basis rests upon what Simon refers to as “economies of scope.” This concept is analogous to Adam Smith’s notion that the division of labor is limited by the extent of the market, the expansion of which—according to Simon—is predicated on entrepreneurial discovery. The extent of the market refers to the security of private property and hence ability to exchange, which allows individuals to reap the returns of discovery and ingenuity: “Discoveries, like resources, may well be infinite: the more we discover, the more we are able to discover” (Simon, 1981 [1996], p. 82), creating markets for resources and the potential for productive specialization and exchange that otherwise would not exist. “Economies of scope,” according to Simon, “stem from (1) the ability to use large and more efficient machinery, (2) the greater division of labor in situations where the market is larger, (3) knowledge creation and technological change, and (4) improved transportation and communication” (1981 [1996], p. 391). The critical link between each of these aspects of economies of scope is an implicit notion of entrepreneurial discovery, which, according to Simon, takes “a view of resources as physical quantities waiting for the plucking, rather than as the services that humankind derives from some combination of knowledge with physical conditions… Hence, resources are, in the most meaningful sense, created” (Simon, 1981 [1996], p. 75).

How is this all related to Oreskes’s argument? “It’s both counterfactual and illogical,” according to Oreskes, “to imagine that more people will solve the problem of too many people. Most population growth is occurring in poor countries, where most people lack educational opportunities that might enable them to develop the kinds of ideas and skills they would need to apply their ‘fresh energy.'” Such a claim would seem to refute my underlying thesis, namely that children come with their own bread. But, the problem that Oreskes is identifying is not one of physical overpopulation but economic underpopulation. How can this be the case?! Indeed most of the growth in the physical numbers of human beings will occur in poorer countries. However, if such countries remain relatively poor, it is because, from an economic standpoint, newly born children are being precluded from realizing their creative potential, and stifling the returns to educational opportunities that emerge as a consequence of opportunities to productively specialize and exchange in the marketplace. Hence, these children may be born without their own bread!

Herein lies the fundamental point with which I wish to conclude here. If children are born into this world with their own bread in a figurative sense, then this requires that the parents of such children—and later the children as adults—have the political and economic freedom to bear the fruits of their own efforts. This includes not only the ability to make a better life for the children in the future, but also a better life for themselves in the present. If, as Julian Simon argued, that the “ultimate resource” is the human mind, then increasing numbers of individuals come with their own bread by creating it from their efforts to economize and discover new resources.

References

Becker, Gary S. (1965). “A Theory of the Allocation of Time.” The Economic Journal 75 (299): 493–517.

Candela, Rosolino A. (2022). “The Division of Labor and Knowledge is Limited by the Division of Ownership Over the Ultimate Resource: The Role of Economies of Scope in Julian Simon.” The Review of Austrian Economics 35(3): 323–341.

Simon, Julian L. (1981 [1996]). The Ultimate Resource 2, Revised Edition. Princeton: Princeton University Press.

Footnotes

[1] An earlier forerunner who had purported that overpopulation was a national security concern in the U.S., as well as the inspiration for Ehrlich’s book title, was business executive Hugh Moore. In addition to a public propaganda campaign that began with his 1954 publication of the proactively titled pamphlet, “The Population Bomb,” Moore had also influenced the Eisenhower administration in the formation of the Draper Committee (named after Moore’s friend Major General William Henry Draper) for promoting research and financial assistance in programs to stem population growth (see “Meet the Advertising Expert who Inspired Today’s Anti-Population Propaganda,” by Peter Jacobsen, FEE, March 31, 2022).

[2] Oreskes, Naomi. “Eight Billion People in the World Is a Crisis, Not an Achievement,” Scientific American, March 1, 2023.