The Great Simplification
We are alive at a time of wonder, peril and possibility.
This is (I hope) becoming obvious to a great many humans.
Ahead are a million unknown destinations, some dark and foreboding, and some welcoming and beautiful. Many of us sense that something is different- something is coming. But we lack a shared understanding of the path that brought us here and of the terrain ahead. Which future we expect depends upon which lens we use to see the road.
Modern society is polarized, stressed, and overwhelmed with information, good and bad. As a result, common points of view -- our lenses –focus on the road just in front of us. For the view to the future, we defer to culturally accepted guides, who are confident they know the way forward.
Through the lens of an economist, for example, we see a glorious road leading to growth that never stops. Any scarcity of energy or material inputs will be solved by price signals, creating incentives which increase our productivity and growth. The economic lens shows us that human ingenuity and the market – will solve everything.
Economists state that our productivity comes from the combination of ‘capital’ and ‘labor’. For them, energy - or any other commodity - aren’t limiters to continued growth. If some input becomes so scarce, the resulting price increase will naturally create incentives for innovation and new tech/inputs to overcome what was previously scarce.
Energy is the only input that has no other inputs besides other energy. Economist Steve Keen rightly says “Labor without energy is a corpse. Technology without energy is a sculpture”. A biophysical assessment of economics would correctly state that capital and labor are both energy dependent variables into the human economic production function.
A financial lens translates stock markets at all time highs as a sign of society's health, portending a rich and virtuous future. With enough financial capital we’ll be able to build roads to anywhere.
In business school, they teach us that a stock’s price is the discounted value of all future projected income streams. We have -for a century - extrapolated this year’s earnings multiplied by some growth rate as a natural prediction of the future - but this entire period was one of growing global access to more energy each year. Very soon this is not likely to be the case..
A technology lens promises a shiny road of comfort, novelty and prosperity enabled by future inventions. Innovation, artificial intelligence, and a vibrant metaverse will sidestep any energy or resource constraints. We envision future humans breaking free from the confines of earth and enjoying high-tech lifestyles where the biggest problem is runaway robots.
These lenses are all optimistic, but misguided. All these lenses are energy blind.
The real paths ahead can only be seen by integrating energy awareness with biology, sociology, physics, and everything science has discovered. We need a “systems” lens to read the map.
A systems lens reveals the holistic story that explains humanity’s path. In pursuit of the same emotional experiences of our ancient ancestors, we transform materials and energy into technologies that make our lives more comfortable and fun. We keep score of our progress using money, which has become a psychological stand-in for all the things our ancestors valued. The massive scale of humanity's consumption is evidenced by the excess CO2 being absorbed by Earth's oceans and atmosphere.
The emergent result is a metabolic superorganism - with oil as its hemoglobin, transporting goods through the arteries and veins of the global supply network.
Like a shark needing to swim to get oxygen flowing through its gills, our current economic system has an imperative to grow in order to satisfy prior financial commitments. We can’t stop nor can we slow down or the system will crash.
A systems lens reveals that the road ahead is closed to current cultural expectations - yet we continue to bear down on the accelerator.
Wearing systems lenses removes the blindspots created by any single issue lens.
Global economic growth will never meaningfully decouple from energy consumption. It cannot - because the world’s GDP, by definition, has always been a proxy for how much energy we burn. If we were to grow the global economy at 3% a year as most governments and institutions expect, we would use as much energy and materials in the next 30 years as we have in the past 10,000.
This is a bold statement but roughly accurate. The rule of 70 shows us that something will double in X years where 70/Y=X and Y is the growth rate. So if the growth rate is 5% a thing will double in 70/5=14 years. Global GDP and energy use is 99%+ correlated. Mineral/material use and GDP (globally) are 100% correlated over time. So at 3% a year the economy will double in 70/3 = ~23.33 years and energy will double in ~30, since we get a little more energy efficient each year. It is possible we get more energy efficient than we have in the past - but then the savings from this efficiency still will be spent on growth and things requiring energy. GDP is de facto a measure of how much energy we burn.
Stock markets are poor guideposts for prosperity when inflated by government and central bank support. All the cash, stocks, bonds, and pension funds in the world need energy and materials to be cashed out and turned into real wealth.
Creativity and innovation will be central to human futures, but modern technology requires huge amounts of energy to build and operate. As long as GDP is our goal, efficiency gains from new technology will serve the superorganism. Transitioning from fossil carbon to rebuildable energy won’t change this dynamic. Ultimately, in addition to using different energy, we’ll need to use energy differently.
We have been rapidly scaling renewable energy. But this has not slowed our CO2 emissions. In fact, the amount of growth in global electricity demand from 2018-2019 alone was more than the entire solar PV capacity installed since it was invented. In 2021 global CO2 emissions have hit all time highs.
Seeing our future through a systems lens - changes everything.
In the coming century, humanity will experience A Great Simplification:
There will always be energy on Earth as long as the Sun burns, but the amount of surplus energy available to us will soon be diminishing. As the extraction of geologically stored energy becomes more difficult, everything we’re used to in society will become more costly or less available. We are not planning for this because it’s never happened before.
The onset of the Great Simplification will be financial and economic turbulence, followed by contraction. When we can no longer grow fast enough to maintain all the increased financial claims, economies will recede to a scale that can again be supported by physical flows without debt. Complex global supply chains, the related high consumption lifestyles and many of the conveniences and freedoms we take for granted in this era of abundant energy surplus will diminish.
The ensuing simplification will be among the most significant events ever experienced by our species. Those who look through a systems lens can serve as early visionaries of a simpler life with new ways of relating to technology, to consumption, to each other and to Earth's ecosystems.
There are many pathways wending through a Great Simplification. Some are wise, humane, and even preferable to what we have now. Some are so dark as to be nearly unthinkable. Yet, it is precisely “thinking about” these pathways, and actively choosing among them, which offers the only realistic hope for a long and meaningful human future.
Nature has gifted us with a productive and beautiful home, the ability to understand how we got here, and the creativity to imagine which paths are possible. The future need not be dystopian, but cleverness alone will no longer suffice for the next leg of our journey -we will need imagination, foresight, empathy and, above all, wisdom to navigate the path to the future that is arriving - the Great Simplification.
