Wow! Just Wonderful Wow!

This infographic which ran on The Economist has been getting a lot of attention, and it’s worthy of the attention, too.

Of course, almost everything on this time scale is a hockey stick. Some people find this a bit alarming. Others think it is cause for celebration.
Here’s a particularly classic example of Not Getting It,

Wow! Just wonderful wow!

Lest we forget, amidst the daily/weekly/monthy/yearly ups and downs of the market, the market is an historically off-the-charts (almost literally) innovation machine.

Be happy that you live when you do and, if you live in the first world, where you do.

Now of course, the curmudgeonly likes of you and me don’t join in the celebration. We immediately think, I guess this sort of person has never learned about The Exponential, as explained by Prof. Bartlett.
But these guys don’t even have that excuse, as revealed in the comments:

I’m wondering about this…(just daydreaming)…The derivative is e^x. One might think that the derivative will always be e^x. History – and the future – always looks the most impressive to those alive/making it.

No, dude, that isn’t how exponentials behave in real-world applications, see… Eventually constraints that weren’t applicable in the early exponential growth phase appear and… Well, it gets complicated after that.

Anyway the reactions to this graph show that people are struck by different things. Others are struck by the triumphant march of civilization. I am struck by how little all this growth nets us.
I am struck that here we are, in the Great Recession or the Lesser Depression or whatever the hell it is. Yet the size of our economic activity exceeds that of any year in history prior to 2008. It substantially exceeds that of the rip-roaring 1990s and the Morning-In-America 1980s and utterly dwarfs the productivity of the postwar boom of the 1950s.
If production is wealth, we are in the richest period ever. We could afford to go to the moon in the 1960s. But now we are in “austerity” measures. We are forcing Greece to sell itself off to bankers. We are firing all our schoolteachers.
What exactly is this thing that has grown, then? And why should we be so happy about it?
Clearly, the thing that has grown is worse than worthless unless it keeps growing, since when it stops growing, we can’t afford to educate our children. And of course, as it gets bigger and bigger, it gets harder and harder to sustain the growth. So that being the case, what glorious achievement does the graph really show? It’s not only clear to me what is ominous about this graph. It’s actually unclear to me what is so inspiring about it.
It’s terrifying that this is a thing that has to grow exponentially all the time or else we have to immediately act on an emergency basis to shut down our civilization, cutting back on parks and cultural events, removing medical coverage from great swaths of the public, firing our schoolteachers. I don’t find a thing like that something to celebrate.
Somebody, tell me again, what is all this endless increase in activity yielding us?

19 thoughts on “Wow! Just Wonderful Wow!

  1. Pangolin says:

    When you're futile cycling doing it faster yields no net output but waste heat. Which is where we are today.

  2. Hank Roberts says:

    op. cit. "… the growth curve will continue upward, even as more and more people begin to sense something like a decline in carrying capacity. Overshoot will occur, if it hasn't already. We may come to feel guilty about stealing from the future, but we will continue to do it. Overshoot will further aggravate the reduction of carrying capacity. Crash must follow. The greater the overshoot, the greater the crash." The Ecological Basis of Revolutionary ChangeWilliam R. Catton Jr.

  3. Joshua says:

    I was just commenting on this graph. The economic activity is directly related to ecological impact, as well. So we have essentially had as much impact on our ecosystem in the last 11 years of this new century as we did in all the 100 years of the past century.And, you're right, how has it truly benefited us? Has it at all, really? If we were producing and consuming at 1970s levels, we'd still be as happy as we are now (so long as we keep 1970's clothing styles and music in the past).All the growth since then has done very little for the wealthy nations, other than make the top 1% of the economy gain incredible amounts of more wealth (40% of all the wealth, 25% of all the income in just the top 1%!)Cheers,Joshua

  4. When does the "economic output" bar for the 21st century surpass that for the entire 20th century? 10 years or so from now?Although it's a different representation, this graphic also is eye-popping. As "the Dad" says in the handwritten note at the top: "the change in the size of the little boxes 1900 –>> 1950 –>> 2011 is impressive." Impressive, er, indeed.I must say that I cop a guilty plea to the stuff that the Cafe Hayek-ians would accuse "me" of: not being able to "see" how human ingenuity can simply work around any perceived or ecological constraints. Yup. I don't get it. Mea culpa. And god would I ever like it if they are right and I am completely wrong…

  5. Oops. Here is that link to a graphic presentation of I = P * A * T over time.Imperfect, but still, wtf???

  6. No, Rust, that graphic is dreadfully wrong, fortunately. The A term is supposed to be per capita, but as shown it is aggregate, so it already includes the P term which is therefore double counted. And the T term, which essentially is supposed to be a mitigating scaling due to improvements in efficiency, is completely wrong.It seems to me that people designing infographics need to understand the information.

  7. Hey, I did say "imperfect". :pAnd while I totally agree on the need to deflate the GDP numbers by the population numbers, I am not so sure that the (very imperfect) proxy for "T" (patents) actually does work as a mitigating factor. You know, did semiconductor patents lead to more or less rare metal use per unit GDP? Etc.

  8. Well, whether T is or isn't mitigating in fact, in principle it is the fudge factor that makes I = P A Tmeaningful.impact = population * (wealth / population) * (impact / wealth)It's always amused me. People thiink of this as such a stroke of brilliance, and yet, in a sense it is completely uninformative. This sort of relation is always true and only sometimes meaningful.impact = population * (beanie babies / population) * (impact of all human activities / beanie babies)is also true, but impact/beanie is not a useful concept. You can make lots of these:what you need = what you want * (what you need / what you want)aardvarks = lemonade stands * (social workers / lemonade stand) * (escalators / social worker) * (aardvarks / escalator)etc. It's only a useful exercise if it breaks down into components that have some intrinsic meaning.And in fact, it's not clear whether we shouldn't use "production" instead of "wealth" in the I = P A T. But my main point is that a count of patents reflects nothing about "technology" construed as impact per unit of wealth OR production. People illustrating I = P A T should have some clue what it means, and people criticizing the graphic should too.

  9. coby says:

    Am I the only one to think quietly to myself "what about oil?" whenever someone credits the explosive growth of humanity over the last one hundred years to innovation in the service of greed? It seems pretty unanimous that this growth is a testament to the genius of free market capitalism etc, but would it have happened if oil did not exist?

  10. Pangolin says:

    Since the graph makes no reference to physical resources used……I'm thinking it means nothing. Impact= population* intangible(meaning monetary value) is the same equation as……Impact = population * ????True, information services have value but until that value expresses as a physical resource used or a resource efficiency expressed the value is moot. Such as…..agriculture* (information service X)= N(tomatoes consumed per capita)> agriculture absent information service XMeasuring the number of tomatoes grown, picked, transported, sold etc. is moot if we don't know how many tomatoes actually go into human mouths. Economic activity ≠(always) value. It may represent futile cycling i.e. tomatoes grown that rot in fields.

  11. Not at all. Most of us think that fossil fuels have something to do with it. You do have to consider the economist's mind set on these matters, though. I am not finding a blog article I read recently, so I'll have to go from memory. It claimed that all it would take to quadruple our oil reserves would be for "scientists" to find a way to extract four times as much energy from a given amount of oil. Therefore we have nothing to worry about. Technological breakthroughs have always happened before.

  12. "If production is wealth, we are in the richest period ever."I suspect one aspect is both population growth and the growing per capita "wealth". I also suspect the growing national purchasing power of places like China and India, whilst the level of depreciation in places riddled with the "Made in China" junk is also part of the story.A while ago, the LSEwebsite Youtube channel also as an excellent presentation on why the baby boomers have done so well – they simply rode that massive growth wave with their assets, such as homes, appreciating greatly over their working life in ways never seen before or since. Such wealth creation is inaccessible to most subsequent generations – something too effects the relative wealth of younger generations.Such disparities effect the real world value of stuff and thus access to that stuff.As Pangolin puts it – our neo-liberal economic models are effectively trying to outrun the Red Queen. If nothing else, it amplifies the effects of the above disparities.With such inertia inherent to the systems, I worry how much we can actually change to avoid the concerns put forth in Rockström et al. (2009) I honestly believe there's a viable 7-9 billion people world which can persist into the long term – but currently we're still trying to live as though it's a 2 billion people world. So much needless debate and certainly a huge amount of self-interest (ie. many heavily invested in the current system) prevent genuine reflection on how we can have a bigger population that is sustainable.It has me at a point where I find it difficult to write articles – basically, I'm speechless. As many are saying, we have the necessary answers around us – we don't really need much further R&D, we need simply to accept that there needs to be an uncomfortable transitional period and simply "suck it up" for the short term to achieve something better.

  13. Dan Olner says:

    I think a population graph from the 1st century to now would do the job fine; very suspicious of anything claiming to measure economic output prior to the 18th/19th century. (Some economists even try and do this all the way back to the dawn of human history… )On the oil/population link: "why did human population suddenly explode over the 19th/20th century?" is a very good question, of which energy is part of an answer. I'd love to hear other ideas, and how people think they are connected. What role health and sanitation? What role agricultural developments? Education has already been discussed. Agri, at least, has a clear connection to petrochemicals, and there's a fascinating overlap with US foreign policy. Quote: 'based on the oversimplification of the population-national security theory, leaders from the US embraced higher production of cereal grains as the key to solving hunger in the third world. With hunger solved, the threat they perceived from communist insurrection would diminish. The popularity of the population-national security theory among policy strategists within the US had its roots in the uncritical embrace of Malthus. So long as Malthusian despair was the only thing that could be seen, there was no other way of thinking about population and the accompanying requirements of agriculture.' Perkins, Geopolitics & the Green Revolution p.259.

  14. Dan Olner says:

    p.s. the second graph doesn't work: think it's behind a subscription wall or summat…

  15. Arnaud says:

    Now, I know MT thinks that space won't save us, but this is the very same British economy magazine which this weeks has "the end of the Space Age" as its leader with the last flight of the Space Shuttle.Funny how for some areas they are pessimistic whilst for others they think it's all rosy… This is also the same rag that, being capitalistic to the bone, argued a few weeks back that China was a great capitalist power and should be the model of the future…I'm not even going into the complete silliness of "years lived" as a measure of progress: Are the 33 years lived by Mozart (or Jesus!) comparable to the 122 years lived by Jeanne Calment or to the 14 years lived by Anne Frank? The only thing I use in the Economist is their style guide (and even then it's rather stuffy really) and their contacts list…W.

  16. Dan Olner says:

    Which reminds me, here was a nice little illustration of capitalism yesterday: Lloyds lays off 10,000 people, shares go up by 10%. Obviously, that's unsurprising: if it returns a company to profitability, that's a natural consequence. It just struck me as a nice tidy illustration of the different incentives in place for workers and capital (or shareholders, since in econs, 'capital' is a catch-all term for 'everything except the workers'.)

  17. Peter T says:

    The graph relies on money, which is not a direct proxy for real wealth (it's more like a representation of wealth – so it includes unicorns, which don't exist, as well as horses).But the graph seems approximately right. I'd like to see something which used a basket of critical commodities (wood, cropland, metals, fish….).

  18. Keep this up and you'll make E. F. Schumaker smile.

  19. susan says:

    Making connections where connections are false, growth has always depended on exploitation. Now that we are reaching the limits of a finite planet, the exhortations of Genesis no longer apply.The world is not there for us to use up, and common sense dictates we take inventory and concentrate on preservation. All that wealth is too concentrated at the top, and not being shared. And any attempt to point this out is considered radical communism. This will not last.

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