A2: Collapse Inevitable – Dollar Decline

A2: Collapse Inevitable – Dollar Decline

No shift – China is key and it alienated necessary supporters

(Daniel, 9-7-11, “The Buck Stays Here,” http://www.foreignpolicy.com/articles/2011/09/07/the_buck_stays_here?page=full)

If anything, however, the shifts in the geopolitical winds have made this possibility even less likely than it was three years ago. China would have to be the de facto leader of such a concert. Its foreign-policy belligerency in 2009 and 2010, however, raised threat perceptions across the Asia-Pacific region about Beijing's martial intentions. Beijing might view fishing boat skirmishes, rare-earths embargoes, and territorial claims in the South China Sea as simply a rising power trying to punch its weight. To the rest of the region, however, these actions require a hedging strategy against China's ambitions -- which means not antagonizing the United States. The very countries that China would need to cooperate with on currency matters are the ones that are warier than they were three years ago.

Demise of the dollar overstated-weak European economies, Chinese wouldn’t let it happen, and Japan will stabilize

Hugh 10 -Macroeconomist who specializes in growth and productivity theory (“Interview with Edward Hugh: The Dollar’s Demise is Vastly Overstated,” Blog Invest, 4/30/10, http://trick-bloggerinvest.blogspot.com/2010/04/interview-with-edward-hugh-dollars.html)
Forex Blog: You wrote a recent post outlining the US Dollar carry trade, and how you believe that the Dollar’s decline is cyclical/temporary rather than structural/permanent. Can you elaborate on this idea? Do you think it’s possible that the fervor with which investors have sold off the Dollar suggests that it could be a little of both? Well, first of all, there is more than one thing happening here, so I would definitely agree from the outset, there are both cyclical and structural elements in play. Structurally, the architecture of Bretton Woods II is creaking round the edges, and in the longer run we are looking at a relative decline in the dollar, but as Keynes reminded us, in the long run we are all dead, while as I noted in the Afoe post, news of the early demise of the dollar is surely vastly overstated. Put another way, while Bretton Woods II has surely seen its best days, till we have some idea what can replace it it is hard to see a major structural adjustment in the dollar. Europe’s economies are not strong enough for the Euro to simply step into the hole left by the dollar, the Chinese, as we know, are reluctant to see the dollar slide too far due to the losses they would take on dollar denominated instruments, while the Russians seem to constantly talk the USD down, while at the same time borrowing in that very same currency – so read this as you will. Personally, I cannot envisage a long term and durable alternative to the current set-up that doesn’t involve the Rupee and the Real, but these currencies are surely not ready for this kind of role at this point. So we will stagger on. On the cyclical side, what I am arguing is that for the time being the US has stepped in where Japan used to be, as one side of your carry pair of choice, since base money has been pumped up massively while there is little demand from consumers for further indebtedness, so the broader monetary aggregates haven’t risen in tandem, leaving large pools of liquidity which can simply leak out of the back door. That is, it may well be one of the perverse consequences of the Fed monetary easing policy that it finances consumption elsewhere – in Norway, or Australia, or South Africa, or Brazil, or India – but not directly inside the US. This is something we saw happening during the last Japanese experiment in quantitative easing (from 2002  - 2006) and that it has the consequence, as it did for the Yen from 2005 to 2007, that the USD will have a trading parity which it would be hard to understand if this were not the case. I am also suggesting that this situation will unwind as and when the Federal Reserve start to seriously talk about withdrawing  the emergency measures (both in terms of interest rates and the various forms of quantitative easing), but that this unwinding is unlikely to be extraordinarily violent, since the Japanese Yen can simply step in to plug the gap, as I am sure the Bank of Japan will not be able to raise interest rates anytime soon given the depth of the deflation problem they have. Indeed, investors will once more be able to borrow in Yen to invest in  USD instruments, to the benefit of Japanese exports and the detriment of the US current account deficit, which is why I think we are in a finely balanced situation, with clear limits to movements in one direction or another.

A2: Resource Scarcity

Resource scarcity is self-correcting

Haynes, BYU economics professor, 2008

(Beth, “Finite Resources vs. Infinite Resourcefulness”, 8-19, http://wealthisnottheproblem.blogspot.com/2008/08/finite-resources-vs-infinite.html)

It’s common sense. Save today in order to have some available tomorrow. It’s how our bank accounts work, so it seems logical to apply the same reasoning to resource use. But there is a catch. All of economic history, up to and including today, demonstrates that the more we exploit our natural resources, the more available they become. (3-7) How can this possibly be? If we use our “limited, non-renewable resources” we have to end up with less, right? Actually, no. And here is why. We don’t simply “use up” existing resources; we constantly create them. We continually invent new processes, discover new sources, improve the efficiency of both use and extraction, while at the same time we discover cheaper, better alternatives. The fact that a particular physical substance is finite is irrelevant. What is relevant is the process of finding ways to meet human needs and desires. The solutions, and thus what we consider resources, are constantly changing. Oil was a nuisance, not a resource, until humans discovered a use for it. In order to survive and flourish, human beings must succeed at fulfilling certain needs and desires. This can be accomplished in a multitude of ways using a multitude of materials. The requirements of life set the goals. How these goals are met does not depend on the existence or the availability of any particular material. Limits are placed not by the finiteness of a physical substance, but by the extent of our knowledge, of our wealth, and of our freedom. Knowledge. Wealth. Freedom. These are the factors which are essential to solving the problems we face. “The Stone Age didn’t end because we ran out of stones.” (8) Think for a minute about how we have solved the problem of meeting basic needs throughout history: Transportation: from walking to landing on the moon Communication: from face-to-face conversations to the World Wide Web. Food: from hunting and gathering to intravenous feeding and hydroponics. Shelter: from finding a cave to building skyscrapers Health care: from shamans to MRIs and neurosurgery. How does progress happen? A synopsis of the process is provided by the main theme of Julian Simon’s book, The Ultimate Resource 2: 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 inventors 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 scarcity occurred. (9) This idea is not just theory. Economists and statisticians have long been analyzing the massive amounts of data collected on resource availability. The conclusion: our ability to solve the problems of human existence is ever-expanding. Resources have become less scarce and the world is a better place to live for more and more people. (3-7) Overall, we create more than we destroy as evidenced by the steady progress in human well being and there is no evidence for concluding that this trend can't and won't continue. Doomsday predictions have been with us since ancient times and they have consistently been proven wrong.

Prices of raw materials are all going down

Lomborg, ’12 (Bjørn, Adjunct Professor at the Copenhagen Business School and head of the Copenhagen Consensus Center, “Environmental Alarmism, Then and Now,” Foreign Affairs, Jul/Aug, Vol. 91, Issue 4, ebscohost, bgm)
Another way to look at the resource question is by examining the prices of various raw materials. The Limits to Growth camp argues that as resource constraints get tighter, prices will rise. Mainstream economists, in contrast, are generally confident that human ingenuity will win out and prices will drop. A famous bet between the two groups took place in 1980. The economist Julian Simon, frustrated by incessant claims that the planet would run out of oil, food, and raw materials, offered to bet $10,000 that any given raw material picked by his opponents would drop in price over time. Simons gauntlet was taken up by the biologist Ehrlich and the physicists John Harte and John Holdren (the latter is now U.S. President Barack Obama's science adviser), saying "the lure of easy money can be irresistible." The three staked their bets on chromium, copper, nickel, tin, and tungsten, and they picked a time frame of ten years. When the decade was up, all five commodities had dropped in price, and they had to concede defeat (although they continued to stand by their original argument). And this was hardly a fluke: commodity prices have generally declined over the last century and a half (see Figure 2).

In short, the authors of The Limits to Growth got their most famous factor, resources, spectacularly wrong. Their graphs show resource levels starting high and dropping, but the situation is precisely the opposite: they start low and rise. Reserves of zinc, copper, bauxite (the principal ore of aluminum), oil, and iron have all been going spectacularly up (see Figure 3).

Sustainable—markets and technology

Chunying Li and Chen 11 School of Economics, Dalian University of Technology Research in World Economy Yanying Chen--School of Economics, Dalian University of Technology Vol. 2, No. 2; October2011 “Entropy, Substitution and Sustainable Economic Growth” Accepted: May 6, 2011 doi:10.5430/rwe.v2n2p66

**Studies cited: Herman and Claudia, 2005, Tao, 2008, Loverjoy, 1996, Smulders and de Nooij, 2003, Pu Yongjian 2k, Yang 2004)

Sustainable development is the primary problem facing human society in the 21st century. As economic growth has long been a panacea to solve unemployment, population growth and equity issues for many countries, the controversy is centered on sustainability of economic growth (Jones, 1999; Cai, 2005, pp.34-37; Li, 2009, pp.32-35). The existing views about whether economic growth can be sustainable under resource constraints are attributed to two critical issues. Most economists define scarcity of resources in terms of opportunity cost, supporting that market price is an indicator of resource scarcity. When a resource becomes rare, a rise in price will induce the economic entity to use other relatively abundant resources, so economic growth can be sustainable. However, most ecologists understand resource scarcity from the physical stock’s view, thinking there is no possibility for resource substitution. Economic growth would stop or even be worse when the stock of critical resources was completely consumed by human economic activities (Daly, 1996; Yu, 2006, pp.12-17). From the economic point of view, the key difference between two critical issues mentioned above is the elasticity of substitution. The optimistic issue assumes the elasticity of substitution between factors should be large enough, at least equal to 1. For example, Stiglitz (1974, pp.123-137) built a model to prove feasibility of economic growth. One key assumption of his model was that elasticity of substitution between natural resources and capital was greater than 1. In contrast, the pessimistic issue assumes the elasticity of substitution is small, and there is at least a resource whose substitution elasticity for others is less than 1. Technical change is another aspect related to sustainable economic growth. The current view reflects optimism as to whether technical change can provide the solution to serious and even persistent environmental issues (Herman and Claudia, 2005, pp.133-147; Tao, 2008, pp.16-19). Most mainstream economists agree that technical change can remove resource limits on economic growth. Technical change could change the elasticity of substitution, improve resource efficiency and mitigate resource scarcity in a long time (Loverjoy, 1996, pp.266-278; Smulders and de Nooij, 2003, pp.59-79). Pu Yongjian (2000) believed that the material stock of natural resources was limited and would gradually decrease with the human economic growth. However, he also believed technological advances would improve the economic contribution of resources, so the economic stock of natural resources would grow continuously and economic growth was sustainable. The research of Yang (2004, pp.40-43) supported that technical change was the driving force of modern economic growth. Without technical change, economic growth would heavily depend on the consumption of energy and resources, which would eventually lead to energy depletion. The related literatures that focus on entropy, substitution and economic growth in the framework of new growth theory have not yet formed a complete theoretical system. This paper, Based on existing studies, uses entropy increasing law in Material-Energy-Information (MEI) system to analyze how elasticity of substitution and technical change will affect sustainable economic growth. Our research shows the elasticity of substitution between any two resources must decrease because of entropy increasing law in MEI system, and the efficiency improvement of resources from technical change is also limited. Therefore, substitution and technical change can not sustain economic growth forever. Our findings will not only provide a new perspective for the research of economic growth theory, but also help us better understand the dynamic process of economic growth.

Innovation solves resource shortages

—new oil extraction, electric cars, nuclear fission/fusion, renewables, etc

Ben-Ami 11 — Daniel Ben-Ami, journalist and author, regular contributor to spiked, has been published in the American, the Australian, Economist.com, Financial Times, the Guardian, the Independent, Novo (Germany), Ode (American and Dutch editions), Prospect, Shanghai Daily, the Sunday Telegraph, the Sunday Times, and Voltaire (Sweden), 2011 (“Growth is good,” Ode, June, Available Online at http://www.odemagazine.com/doc/print/75/growth-is-good, Accessed 08-16-2011)
There are many reasons why the notion of scarce resources is mistaken. Take energy as an example. For almost a century, authorities have warned that oil is on the verge of running out. Yet the exhaustion of oil supplies is still a long way off. New sources of oil have been discovered, including under the seabed, and extraction techniques have been improved. In the future, it may also be possible to extract huge amounts of oil from tar sands or produce plentiful gasoline from coal. Perhaps one day, oil will be close to running out or it will be considered too dirty to use. That still leaves plenty of options. A s technology improves, electric cars could become much more viable. It is also already possible to generate huge amounts of energy from nuclear fission, the process that powers the sun, while in the future, nuclear fusion could provide unlimited energy. Perhaps other technologies will turn out to be better, but the point is that apparently insurmountable resource shortages can be overcome. Human ingenuity is unlimited. It is not a question of needing, say, three planets to sustain humanity, but of making this planet more productive

Our economics are becoming less resource dependent

Bithas & Kalimeris, 13 (K. Bithas, P. Kalimeris, Research Team on Environmental Economics and Sustainable Development, Department of Economics and Regional Development, Panteion University, Energy, Volume 51, 1 March 2013, Pages 78–84, “Re-estimating the decoupling effect: Is there an actual transition towards a less energy-intensive economy?” accessed online via Science Direct, jj)
Estimations of the potential for decoupling of economic growth from energy use are based on empirical estimates of the E/GDP ratio. Historically, this ratio has followed a decreasing path. Projections from this trend raise optimism for a transition into an era of relative independence from natural resources and hence an era of a-growth. However, the E/GDP ratio fails to take into account a fundamental characteristic of economic production. We propose the E/GDP per Capita ratio as a better approximation, in comparison to the E/GDP ratio, of the energy requirements of real world production process. The evolutionary pattern of Energy/GDP per Capita ratio incorporates two fundamental evolutions that Energy/GDP ratio fails to account for: the physical properties of production and the demographic evolution. Economic goods changed drastically throughout the time periods studied by the present study and by the relevant studies found in recent literature. Technological advance makes possible the satisfaction of certain human needs by producing goods that require less energy inputs while, at the same time, the structure of production is shifting towards “soft” goods (services). Evidently, these trends are sufficiently reflected on Energy/GDP ratio. On the other hand, the Energy/GDP per Capita ratio accounts for the physical properties of production process. Simultaneously, Energy/GDP per Capita reflects the population impacts on the energy requirements of production. An increasing population requires more “basic goods” for the satisfaction of “basic needs”. “Basic goods” have substantial physical dimensions and consequently require certain energy inputs. As a result, the relevant decoupling estimates are rather moderate. Empirical estimation of E/GDP per Capita for global growth indicates increasing energy intensity until the 1980's when relative stability commenced. Differences between the evolutionary patterns of E/GDP and E/GDP per Capita ratios result in different expectations of the potential for decoupling in the future.

We won’t run out of resources

Simon, ’94 (Julian, professor of business administration at the University of Maryland and a Senior Fellow at the Cato Institute, February 9, 1994, http://www.juliansimon.com/writings/Ultimate_Resource/TCHAR28.txt)
There is no persuasive reason to believe that the relatively larger use of natural resources that would occur with a larger population would have any special deleterious effects upon the economy in the future. For the foreseeable future, even if the extrapolation of past trends is badly in error, the cost of energy is not an important consideration in evaluating the impact of population growth. Other natural resources may be treated in a manner just like any other physical capital when considering the economic effect of different rates of population growth. Depletion of mineral resources is not a special danger for the long run or the short run. Rather, the availability of mineral resources, as measured by their prices, may be expected to increase - that is, costs may be expected to decrease - despite all notions about "finiteness." Sound appraisal of the impact of additional people upon the "scarcity" (cost) of a natural resource must take into account the feedback from increased demand to the discovery of new deposits, new ways of extracting the resource, and new substitutes for the resource. And we must take into account the relationship between demand now and supply in various future years, rather than considering only the effect on supply now of greater or lesser demand now. And the more people there are, the more minds that are working to discover new sources and increase productivity, with raw materials as with all other goods.

Tech solves—we constantly create new resources:

Simon, ’94 (Julian, professor of business administration at the University of Maryland and a Senior Fellow at the Cato Institute, February 9, 1994, http://www.juliansimon.com/writings/Ultimate_Resource/TCHAR28.txt)
This point of view is not limited to economists. A technologist writing on minerals put it this way: "In effect, technology keeps creating new resources." The major constraint upon the human capacity to enjoy unlimited minerals, energy, and other raw materials at acceptable prices is knowledge. And the source of knowledge is the human mind. Ultimately, then, the key constraint is human imagination acting together with educated skills. This is why an increase of human beings, along with causing an additional consumption of resources, constitutes a crucial addition to the stock of natural resources. We must remember, however, that human imagination can flourish only if the economic system gives individuals the freedom to exercise their talents and to take advantage of opportunities. So another crucial element in the economics of resources and population is the extent to which the political-legal-economic system provides personal freedom from government coercion. Skilled persons require an appropriate framework that provides incentives for working hard and taking risks, enabling their talents to flower and come to fruition. The key elements of such a framework are economic liberty, respect for property, and fair and sensible rules of the market that are enforced equally for all.

Cap sustainable

Norberg, 03 (Johan Norberg, Senior Fellow at Cato Institute, “In Defense of Global Capitalism”, p. 223)
It is a mistake, then, to believe that growth automatically ruins the environment. And claims that we would need this or that number of planets for the whole world to attain a Western standard of consumption—those “ecological footprint” calculations—are equally untruthful. Such a claim is usually made by environmentalists, and it is concerned, not so much with emissions and pollution, as with resources running out if everyone were to live as we do in the affluent world. Clearly, certain of the raw materials we use today, in present day quantities, would not suffice for the whole world if everyone consumed the same things. But that information is just about as interesting as if a prosperous Stone Age man were to say that, if everyone attained his level of consumption, there would not be enough stone, salt, and furs to go around. Raw material consumption is not static. With more and more people achieving a high level of prosperity, we start looking for ways of using other raw materials. Humanity is constantly improving technology so as to get at raw materials that were previously inaccessible, and we are attaining a level of prosperity that makes this possible. New innovations make it possible for old raw materials to be put to better use and for garbage to be turned into new raw materials. A century and a half ago, oil was just something black and sticky that people preferred not to step in and definitely did not want to find beneath their land. But our interest in finding better energy sources led to methods being devised for using oil, and today it is one of our prime resources. Sand has never been all that exciting or precious, but today it is a vital raw material in the most powerful technology of our age, the computer. In the form of silicon—which makes up a quarter of the earth's crust— it is a key component in computer chips. There is a simple market mechanism that averts shortages. If a certain raw material comes to be in short supply, its price goes up. This makes everyone more interested in economizing on that resource, in finding more of it, in reusing it, and in trying to find substitutes for it.

No limits to growth

Kasun, ’99 (Jacqueline, THE WAR AGAINST POPULATION: THE ECONOMICS AND IDEOLOGY OF POPULATION CONTROL, 1999, p. 75-6)
The question, then, is resolved in favor of the economic notion of scarcity rather than the lifeboat model of absolute limits being the more nearly correct. While resources are always scarce relative to the demands that human beings place upon them, there is no indication of imminent absolute limits. The limits are so far beyond the levels of our present use of resources as to be nearly invisible, and are actually receding as new knowledge develops. Ironically, though, the perception of economic scarcity may increase along with increasing wealth and income. There is no evidence whatsoever that slower rates of population growth encourage economic growth or economic welfare. It may, of course, be in the interests of a ruling bureaucracy to rid itself of those people it finds troublesome, but the policy can hardly promote the general welfare, and it would prove very costly, even to the ruling elites.

Prefer Our Ev

Limits to growth predictions have all been wrong

Lomborg, ’12 (Bjørn, Adjunct Professor at the Copenhagen Business School and head of the Copenhagen Consensus Center, “Environmental Alarmism, Then and Now,” Foreign Affairs, Jul/Aug, Vol. 91, Issue 4, ebscohost, bgm)
FORTY YEARS on, how do the predictions stack up? Defenders like to point out that The Limits to Growth carefully hedged its bets, with its authors claiming that they were not presenting "exact predictions" and that they were "deliberately… somewhat vague" on time frames because they wanted to focus on the general behavior of the system. But this is sophistry. It was obvious from the way the book was both presented and understood that it made a number of clear predictions, including that the world would soon run out many nonrenewable resources. Assuming exponentially increasing demand, The Limits to Growth calculated how soon after 1970 various resources would be exhausted. Their conclusion was that before 2012, the world would run out of aluminum, copper, gold, lead, mercury, molybdenum, natural gas, oil, silver, tin, tungsten, and zinc--12 of the 19 substances they looked at. They were simply and spectacularly wrong. They singled out mercury, claiming that its known global reserves in 1970 would last for only 13 years of exponential growth in demand, or 41 years if the reserves magically quintupled. They noted that "the prices of those resources with the shortest static reserve indices have already begun to increase. The price of mercury, for example, has gone up 500 percent in the last 20 years." Since then, however, technological innovations have led to the replacement of mercury in batteries, dental fillings, and thermometers. Mercury consumption has collapsed by 98 percent, and by 2000, the price had dropped by 90 percent. They predicted that gold might run out as early as 1979 and would certainly do so by 1999, based on estimations of 10,980 tons of known reserves in 1970. In the subsequent 40 years, however, 81,410 tons of gold have been mined, and gold reserves are now estimated to be 51,000 tons. Known reserves of copper in 1970 came to 280 million tons. Since then, about 400 million tons have been produced globally, and world copper reserves are now estimated at almost 700 million tons. Since 1946, new copper reserves have been discovered faster than existing copper reserves have been depleted. And the same goes for the other three most economically important metals: aluminum, iron, and zinc. Despite a 16-fold increase in aluminum consumption since 1950, and despite the fact that the world has consumed four times the 1950 known reserves in the years since, aluminum reserves now could support 177 years of the present level of consumption. The Limits to Growth also worried about running out of oil (in 1990) and natural gas (in 1992). Not only have those not run out, but their reserves, measured in terms of years of current consumption, are larger today than they have ever been since 1970, even though consumption has increased dramatically.

Bias/Epistemology

Prefer our evidence – the brain is hardwired to be overly pessimistic about abundance

Diamandis and Kotler, ’12 (Dr. Peter, Chairman and CEO of the X PRIZE Foundation, which leads the world in designing and launching large incentive prizes to drive radical breakthroughs for the benefit of humanity and co-founder and executive chairman of Singularity University, a non-profit learning institution in Silicon Valley whose stated aim is to "assemble, educate and inspire a cadre of leaders who strive to understand and facilitate the development of exponentially advancing technologies and apply, focus and guide these tools to address humanity’s grand challenges,” and Steven, co-founder and director of research of the Flow Genome Project, Abundance: The Future Is Better Than You Think, p. 30-31, bgm)
Our common biases have since become known as cognitive biases,which are defined as “patterns of deviation in judgment that occur in particular situations.” Researchers have now collected a very long list of these biases, and a great many of them have a direct impact on our ability tobelieve in the possibility of abundance. For example, confirmation bias is atendency to search for or interpret information in a way that confirms one’spreconceptions—but it can often limit our ability to take in new data andchange old opinions. This means that if your opposition to abundance isbuilt around “the hole we’re in is too deep to climb out of” hypothesis, anyinformation that confirms your suspicions will be remembered, while conflicting data will not even register.Here’s a great example: Sarah Palm’s alleged “death panels.” In 2009 and2010, during debates over the Obama administration’s proposed health carereform bill, the idea spread like wildfire despite reliable sources decrying itsmendacity. The New York Times was puzzled: “The stubborn yet false rumor that President Obama’s health care proposals would create government-sponsored ‘death panels’ to decide which patients were worthy of livingseemed to arise from nowhere in recent weeks.” But “nowhere” was reallyour confirmation bias. Far-right Republicans already distrusted Obama, sothose reliable death panel denials fell on deaf ears.And confirmation bias is but only one of a litany of biases impactingabundance. The negativity bias—the tendency to give more weight to negative information and experiences than positive ones sure isn’t helpingmatters. Then there’s anchoring: the predilection for relying too heavily onone piece of information when making decisions. “When people believe theworld’s falling apart,” says Kahneman, “it’s often an anchoring problem. Atthe end of the nineteenth century, London was becoming uninhabitablebecause of the accumulation of horse manure. People were absolutely panicked. Because of anchoring, they couldn’t imagine any other possible solutions. No one had any idea the car was coming and soon they’d be worryingabout dirty skies, not dirty streets.”Making this situation more difficult is the fact that our cognitive biasesoften work in tandem. Because of our negativity bias, standing up in today’s climate and claiming that the world is getting better makes you appear addled. But we also suffer from the bandwagon effect—the tendency to do or believe things because others do—so even if you suspect there is realcause for optimism, these two biases will team up and make you doubt yourown opinion.

Their evidence is biased – biology makes us hardwired against sustainability – things are getting better

Diamandis and Kotler, ’12 (Dr. Peter, Chairman and CEO of the X PRIZE Foundation, which leads the world in designing and launching large incentive prizes to drive radical breakthroughs for the benefit of humanity and co-founder and executive chairman of Singularity University, a non-profit learning institution in Silicon Valley whose stated aim is to "assemble, educate and inspire a cadre of leaders who strive to understand and facilitate the development of exponentially advancing technologies and apply, focus and guide these tools to address humanity’s grand challenges,” and Steven, co-founder and director of research of the Flow Genome Project, Abundance: The Future Is Better Than You Think, p. 32-34, bgm)
Every second, an avalanche or data pours in through our senses. To process this deluge, the brain is continuously sifting and sorting information, trying to tease apart the critical from the casual. And since nothing is more critical to the brain than survival, the first filter most of this incoming information encounters is the amygdala. The amygdala is an almond-shaped sliver of the temporal lobe responsible for primal emotions like rage, hate, and fear. It’s our early warning system, an organ always on high alert, whose job is to find anything in our environment that could threaten survival, Anxious under normal conditions, once stimulated, the amygdala becomes hypervigilant. Then our focus tightens and our fight-or-flight response turns on. Heart rate speeds up, nerves fire faster, eyes dilate for improved vision, the skin cools as blood moves toward our muscles for faster reaction times. Cognitively, our pattern-recognition system scours our memories, hunting for similar situations (to help ID the threat) and potential solutions (to help neutralize the threat). But so potent is this response that once turned on, it’s almost impossible to shut off, and this is a problem in the modern world. These days, we are saturated with information. We have millions of news outlets competing for our mind share. And how do they compete? By vying for the amygdala’s attention. The old newspaper saw “If it bleeds, it leads” works because the first stop that all incoming information encounters is an organ already primed to look for danger. We’re feeding a fiend. Pick up the Washington Post and compare the number of positive to negative stories. If your experiment goes anything like mine, you’ll find that over 90 percent of the articles are pessimistic. Quite simply, good news doesn’t catch our attention. Bad news sells because the amygdala is always looking for something to fear. . . But this has an immediate impact on our perception, David Eagleman, a neuroscientist at Baylor College of Medicine, explains that even under mundane circumstances, attention is a limited resource. “Imagine you’re watching a short film with a single actor cooking an omelet. The camera cuts to a different angle as the actor continues cooking. Surely you would notice if the actor changed into a different person, right? Two-thirds of observers don’t. This happens because attention is a seriously limited resource, and once we’re focused on one thing, we often don’t notice the next. Of course, any fear response only amplifies the effect. What all of this means is that once the amygdala begins hunting bad news, it’s mostly going to find bad news. Compounding this, our early warning system evolved in an era of immediacy, when threats were of the tiger-in-the-bush variety. Things have changed since. Many of today’s dangers are probabilistic—the economy might nose-dive, there could be a terrorist attack and the amygdala can’t tell the difference. Worse, the system is also designed not to shut off until the potential danger has vanished completely, but probabilistic dangers never vanish completely. Add in an impossible-to-avoid media continuously scaring us in an attempt to capture market share, and you have a brain convinced that it’s living in a state of siege—a state that s especially troubling, as New York University’s Dr. Marc Siegel explains in his book False Alarm: The Truth About the Epidemic of Fear, because nothing could be further from the truth: Statistically, the industrialized world has never been safer. Many of us are living longer and more uneventfully. Nevertheless, we live in worst-case fear scenarios. Over the past century, we Americans have dramatically reduced our risk in virtually every area of life, resulting in life spans 60 percent longer in 2000 than in 1900. Antibiotics have reduced the likelihood of dying from infections…Public health measures dictate standards for drinkable water and breathable air. Our garbage is removed quickly. We live in temperature-controlled, disease-controlled lives. And yet, we worry more than ever before. The natural dangers are no longer there, but the response mechanisms are still in place, and now they are turned on much of the time. We implode, turning our adaptive fear mechanism into a maladaptive panicked response. For abundance, all this carries a triple penalty. First, it’s hard to be optimistic, because the brain’s filtering architecture is pessimistic by design. Second, good news is drowned out, because it’s in the medias best interest to overemphasize the bad. Third, scientists have recently discovered an even bigger cost: it’s not just that these survival instincts make us believe that “the hole we’re in is too deep to climb out of,” but they also limit our desire to climb out of that hole. A desire to better the world is predicated partially on empathy and compassion. The good news is that we now know that these prosocial behaviors are hardwired into the brain. The bad news is that these behaviors are wired into the slower-moving, recently evolved prefrontal cortex. But the amygdala evolved long ago, in an era of immediacy, when reaction time was critical for survival. When there’s a tiger in the bush there isn’t much time to think, so the brain takes a shortcut: it doesn’t. In dangerous situations, the amygdala directs information around the prefrontal cortex. This is why you jump backward when you see a squiggly shape on the ground before you have time to deduce stick, not snake. But because of the difference in neuronal processing speeds, once our primitive survival instincts take over, our newer, prosocial instincts stay sidelined. Compassion, empathy, altruism—even indignation—become nonfactors. Once the media has us on high alert, for example, the chasm between rich and poor looks too big to bridge because the very emotions that would make us want to close that gap are currently locked, out of the system.

Sustainability Coming

We are on the brink of a new biosphere consciousness -- solves sustainability.

Rifkin 10 (Jeremy Rifkin, Author the Third Industrial Revolution: How Lateral Power is Transforming Energy, the Economy, and the World, “The Empathic Civilization’: Rethinking Human Nature in the Biosphere Era,” http://www.huffingtonpost.com/jeremy-rifkin/the-empathic-civilization_b_416589.html//Mkoo)
If human nature is as the Enlightenment philosophers claimed, then we are likely doomed. It is impossible to imagine how we might create a sustainable global economy and restore the biosphere to health if each and every one of us is, at the core of our biology, an autonomous agent and a self-centered and materialistic being. Recent discoveries in brain science and child development, however, are forcing us to rethink these long-held shibboleths about human nature. Biologists and cognitive neuroscientists are discovering mirror-neurons--the so-called empathy neurons--that allow human beings and other species to feel and experience another's situation as if it were one's own. We are, it appears, the most social of animals and seek intimate participation and companionship with our fellows. Social scientists, in turn, are beginning to reexamine human history from an empathic lens and, in the process, discovering previously hidden strands of the human narrative which suggests that human evolution is measured not only by the expansion of power over nature, but also by the intensification and extension of empathy to more diverse others across broader temporal and spatial domains. The growing scientific evidence that we are a fundamentally empathic species has profound and far-reaching consequences for society, and may well determine our fate as a species. What is required now is nothing less than a leap to global empathic consciousness and in less than a generation if we are to resurrect the global economy and revitalize the biosphere. The question becomes this: what is the mechanism that allows empathic sensitivity to mature and consciousness to expand through history? The pivotal turning points in human consciousness occur when new energy regimes converge with new communications revolutions, creating new economic eras. The new communications revolutions become the command and control mechanisms for structuring, organizing and managing more complex civilizations that the new energy regimes make possible. For example, in the early modern age, print communication became the means to organize and manage the technologies, organizations, and infrastructure of the coal, steam, and rail revolution. It would have been impossible to administer the first industrial revolution using script and codex. Communication revolutions not only manage new, more complex energy regimes, but also change human consciousness in the process. Forager/hunter societies relied on oral communications and their consciousness was mythologically constructed. The great hydraulic agricultural civilizations were, for the most part, organized around script communication and steeped in theological consciousness. The first industrial revolution of the 19th century was managed by print communication and ushered in ideological consciousness. Electronic communication became the command and control mechanism for arranging the second industrial revolution in the 20th century and spawned psychological consciousness. Each more sophisticated communication revolution brings together more diverse people in increasingly more expansive and varied social networks. Oral communication has only limited temporal and spatial reach while script, print and electronic communications each extend the range and depth of human social interaction. By extending the central nervous system of each individual and the society as a whole, communication revolutions provide an evermore inclusive playing field for empathy to mature and consciousness to expand. For example, during the period of the great hydraulic agricultural civilizations characterized by script and theological consciousness, empathic sensitivity broadened from tribal blood ties to associational ties based on common religious affiliation. Jews came to empathize with Jews, Christians with Christians, Muslims with Muslims, etc. In the first industrial revolution characterized by print and ideological consciousness, empathic sensibility extended to national borders, with Americans empathizing with Americans, Germans with Germans, Japanese with Japanese and so on. In the second industrial revolution, characterized by electronic communication and psychological consciousness, individuals began to identify with like-minded others. Today, we are on the cusp of another historic convergence of energy and communication--a third industrial revolution--that could extend empathic sensibility to the biosphere itself and all of life on Earth. The distributed Internet revolution is coming together with distributed renewable energies, making possible a sustainable, post-carbon economy that is both globally connected and locally managed. In the 21st century, hundreds of millions--and eventually billions--of human beings will transform their buildings into power plants to harvest renewable energies on site, store those energies in the form of hydrogen and share electricity, peer-to-peer, across local, regional, national and continental inter-grids that act much like the Internet. The open source sharing of energy, like open source sharing of information, will give rise to collaborative energy spaces--not unlike the collaborative social spaces that currently exist on the Internet. When every family and business comes to take responsibility for its own small swath of the biosphere by harnessing renewable energy and sharing it with millions of others on smart power grids that stretch across continents, we become intimately interconnected at the most basic level of earthly existence by jointly stewarding the energy that bathes the planet and sustains all of life. The new distributed communication revolution not only organizes distributed renewable energies, but also changes human consciousness. The information communication technologies (ICT) revolution is quickly extending the central nervous system of billions of human beings and connecting the human race across time and space, allowing empathy to flourish on a global scale, for the first time in history. Whether in fact we will begin to empathize as a species will depend on how we use the new distributed communication medium. While distributed communications technologies-and, soon, distributed renewable energies - are connecting the human race, what is so shocking is that no one has offered much of a reason as to why we ought to be connected. We talk breathlessly about access and inclusion in a global communications network but speak little of exactly why we want to communicate with one another on such a planetary scale. What's sorely missing is an overarching reason that billions of human beings should be increasingly connected. Toward what end? The only feeble explanations thus far offered are to share information, be entertained, advance commercial exchange and speed the globalization of the economy. All the above, while relevant, nonetheless seem insufficient to justify why nearly seven billion human beings should be connected and mutually embedded in a globalized society. The idea of even billion individual connections, absent any overall unifying purpose, seems a colossal waste of human energy. More important, making global connections without any real transcendent purpose risks a narrowing rather than an expanding of human consciousness. But what if our distributed global communication networks were put to the task of helping us re-participate in deep communion with the common biosphere that sustains all of our lives? The biosphere is the narrow band that extends some forty miles from the ocean floor to outer space where living creatures and the Earth's geochemical processes interact to sustain each other. We are learning that the biosphere functions like an indivisible organism. It is the continuous symbiotic relationships between every living creature and between living creatures and the geochemical processes that ensure the survival of the planetary organism and the individual species that live within its biospheric envelope. If every human life, the species as a whole, and all other life-forms are entwined with one another and with the geochemistry of the planet in a rich and complex choreography that sustains life itself, then we are all dependent on and responsible for the health of the whole organism. Carrying out that responsibility means living out our individual lives in our neighborhoods and communities in ways that promote the general well-being of the larger biosphere within which we dwell. The Third Industrial Revolution offers just such an opportunity. If we can harness our empathic sensibility to establish a new global ethic that recognizes and acts to harmonize the many relationships that make up the life-sustaining forces of the planet, we will have moved beyond the detached, self-interested and utilitarian philosophical assumptions that accompanied national markets and nation state governance and into a new era of biosphere consciousness. We leave the old world of geopolitics behind and enter into a new world of biosphere politics, with new forms of governance emerging to accompany our new biosphere awareness. The Third Industrial Revolution and the new era of distributed capitalism allow us to sculpt a new approach to globalization, this time emphasizing continentalization from the bottom up. Because renewable energies are more or less equally distributed around the world, every region is potentially amply endowed with the power it needs to be relatively self-sufficient and sustainable in its lifestyle, while at the same time interconnected via smart grids to other regions across countries and continents. When every community is locally empowered, both figuratively and literally, it can engage directly in regional, transnational, continental, and limited global trade without the severe restrictions that are imposed by the geopolitics that oversee elite fossil fuels and uranium energy distribution. Continentalization is already bringing with it a new form of governance. The nation-state, which grew up alongside the First and Second Industrial Revolutions, and provided the regulatory mechanism for managing an energy regime whose reach was the geosphere, is ill suited for a Third Industrial Revolution whose domain is the biosphere. Distributed renewable energies generated locally and regionally and shared openly--peer to peer--across vast contiguous land masses connected by intelligent utility networks and smart logistics and supply chains favor a seamless network of governing institutions that span entire continents. The European Union is the first continental governing institution of the Third Industrial Revolution era. The EU is already beginning to put in place the infrastructure for a European-wide energy regime, along with the codes, regulations, and standards to effectively operate a seamless transport, communications, and energy grid that will stretch from the Irish Sea to the doorsteps of Russia by midcentury. Asian, African, and Latin American continental political unions are also in the making and will likely be the premier governing institutions on their respective continents by 2050. In this new era of distributed energy, governing institutions will more resemble the workings of the ecosystems they manage. Just as habitats function within ecosystems, and ecosystems within the biosphere in a web of interrelationships, governing institutions will similarly function in a collaborative network of relationships with localities, regions, and nations all embedded within the continent as a whole. This new complex political organism operates like the biosphere it attends, synergistically and reciprocally. This is biosphere politics. The new biosphere politics transcends traditional right/left distinctions so characteristic of the geopolitics of the modern market economy and nation-state era. The new divide is generational and contrasts the traditional top-down model of structuring family life, education, commerce, and governance with a younger generation whose thinking is more relational and distributed, whose nature is more collaborative and cosmopolitan, and whose work and social spaces favor open-source commons. For the Internet generation, "quality of life" becomes as important as individual opportunity in fashioning a new dream for the 21st century. The transition to biosphere consciousness has already begun. All over the world, a younger generation is beginning to realize that one's daily consumption of energy and other resources ultimately affects the lives of every other human being and every other creature that inhabits the Earth. The Empathic Civilization is emerging. A younger generation is fast extending its empathic embrace beyond religious affiliations and national identification to include the whole of humanity and the vast project of life that envelops the Earth. But our rush to universal empathic connectivity is running up against a rapidly accelerating entropic juggernaut in the form of climate change. Can we reach biosphere consciousness and global empathy in time to avert planetary collapse?

Growth Sustainable – Nanotech

Nanotech solves all problems and creates global abundance

Diamandis and Kotler, ’12 (Dr. Peter, Chairman and CEO of the X PRIZE Foundation, which leads the world in designing and launching large incentive prizes to drive radical breakthroughs for the benefit of humanity and co-founder and executive chairman of Singularity University, a non-profit learning institution in Silicon Valley whose stated aim is to "assemble, educate and inspire a cadre of leaders who strive to understand and facilitate the development of exponentially advancing technologies and apply, focus and guide these tools to address humanity’s grand challenges,” and Steven, co-founder and director of research of the Flow Genome Project, Abundance: The Future Is Better Than You Think, p. 72, bgm)
While concerns about nanobots and gray goo are decades away (most likely beyond the time line of this book), nanoscience is already giving us incredible returns. Nanocomposites are now considerably stronger than steel and can be created for a fraction of the cost. Single-walled carbon nanotubes exhibit very high electron mobility and are being used to boost power conversion efficiency in solar cells. And Buckminsterfullerenes (C60), or Buckyballs, are soccer-ball-shaped molecules containing sixty carbon atoms with potential uses ranging from superconductor materials to drug delivery systems. All told, as a recent National Science Foundation report on the subject pointed out, “nanotechnology has the potential to enhance human performance, to bring sustainable development for materials, water, energy, and food, to protect against unknown bacteria and viruses, and even to diminish the reasons for breaking the peace [by creating universal abundance].”

Growth Sustainable – AI Solves

AI makes growth sustainable – processing power massively reduces costs

Diamandis and Kotler, ’12 (Dr. Peter, Chairman and CEO of the X PRIZE Foundation, which leads the world in designing and launching large incentive prizes to drive radical breakthroughs for the benefit of humanity and co-founder and executive chairman of Singularity University, a non-profit learning institution in Silicon Valley whose stated aim is to "assemble, educate and inspire a cadre of leaders who strive to understand and facilitate the development of exponentially advancing technologies and apply, focus and guide these tools to address humanity’s grand challenges,” and Steven, co-founder and director of research of the Flow Genome Project, Abundance: The Future Is Better Than You Think, p. 65-66, bgm)
And autonomous cars are but a small slice of a much larger picture. Diagnosing patients, teaching our children, serving as the backbone for a new energy paradigm—the list of ways that AI will reshape our lives in the years ahead goes on and on. The best proof of this, by the way, is the list of ways that AI has already shaped our lives. Whether it’s the lightning-fast response of the Google search engine or the speech recognition used for directory information calls, we are already AI codependent. While some ignore these “weak AI” applications, waiting instead for the “strong AI” of Arthur C. Clark’s HAL 9000 computer from 2001: A Space Odyssey, it’s not like we haven’t made progress. “Consider the man-versus-machine chess competition between Garry Kasparov and IBM’s Deep Blue,” says Kurzweil. “In 1992, when the idea that a computer could play against a world chess champion was first proposed, it was dismissed outright. But the constant doubling of computer power every year enabled the Deep Blue supercomputer to defeat Kasparov only five years later. Today you can buy a championship-level Chess AI for your iPhone for less than ten dollars.” So when will we have true HAL-esque AI? It’s hard to say. But IBM recently unveiled two new chip technologies that move us in this direction. The first integrates electrical and optical devices on the same piece of silicon. These chips communicate with light. Electrical signals require electrons, which generate heat, which limits the amount of work a chip can perform and requires a lot of power for cooling. Light has neither limitation. If IBM’s estimations are correct, over the next eight years, its new chip design will accelerate supercomputer performance a thousandfold, taking us from our current 2.6 petaflops to an exaflop (thats 10 to the 18th, or a quintillion operations per second)—or one hundred times faster than the human brain. The second is SyNAPSE, Big Blue’s brain-mimicking silicon chip. Each chip has a grid of 256 parallel wires representing dendrites and a perpendicular set of wires for axons. Where these wires intersect are the synapses and one chip has 262,144 of them. In preliminary tests, the chips were able to play a game of Pong, control a virtual car on a racecourse, and identify an image drawn on a screen. These are all tasks that computers have accomplished before, but these new chips don’t need specialized programs to complete each task; instead they respond to real-world circumstances and learn from their experiences Certainly there’s no guarantee that these things will be enough to create HAL—strong AI may require more than just a brute force solution but it’s definitely going to rocket us up the abundance pyramid. Just think about what this will mean for the diagnostic potential in personalized medicine; or the educational potential in personalized education. (If you’re having trouble imagining these concepts, just hang on for a few chapters, and I’ll describe them in detail.) Yet as intriguing as all of this might seem, it’s nothing compared to the benefits that AI will provide when combined with our next exponential category: robotics.

Growth Sustainable – Robots

Robotics and automation increase productivity

Diamandis and Kotler, ’12 (Dr. Peter, Chairman and CEO of the X PRIZE Foundation, which leads the world in designing and launching large incentive prizes to drive radical breakthroughs for the benefit of humanity and co-founder and executive chairman of Singularity University, a non-profit learning institution in Silicon Valley whose stated aim is to "assemble, educate and inspire a cadre of leaders who strive to understand and facilitate the development of exponentially advancing technologies and apply, focus and guide these tools to address humanity’s grand challenges,” and Steven, co-founder and director of research of the Flow Genome Project, Abundance: The Future Is Better Than You Think, p. 67-68, bgm)
So what’s going to happen next, and what does it have to do with a world of abundance? Hassan has a list of beneficial applications, including mechanical nurses taking care of the elderly, and mechanized physicians making health care affordable and accessible. But he is most enthralled by economic possibilities. “In 1950 the global world product was roughly four trillion dollars,” he says. “In 2008, fifty-eight years later, it was sixty- one trillion dollars. Where did this fifteenfold increase come from? It came from increased productivity in our factories equipped with automation. About ten years ago, while visiting Japan, I toured a Toyota car manufacturing plant that was able to produce five hundred cars per day with only four hundred employees because of automation. I thought to myself, ‘Imagine if you could take this automation and productivity out of the factory and put it into our everyday lives?’ I believe this will increase our global economy by orders of magnitude in the decades ahead.” In June 2011 President Obama announced -the National Robotics Initiative (NRI), a $70 million multistakeholder effort to “accelerate the development and use of robots in the United States that work beside, or cooperatively, with people.” Just like Willow Garage’s attempt to create a stable platform for development in the P2P, the NM is structured around “critical enablers”: anchoring technologies that allow manufacturers to standardize processes and products, thus cutting development time and increasing performance. As Helen Greiner, president of the Robotics Technology Consortium, told PC World magazine: “Investing in robotics is more than just money for research and development, it is a vehicle to transform American lives and revitalize the American economy. Indeed, we are at a critical juncture where we are seeing robotics transition from the laboratory to generate new businesses, create jobs, and confront the important challenges facing our nation.”

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