What Does the Future Hold? The Forecast in a Nutshell
Julian L. Simon

No food, one problem. Much food, many problems. (Anonymous)

This is my long-run forecast in brief: The material conditions of life will continue to get better for most people, in most countries, most of the time, indefinitely. Within a century or two, all nations and most of humanity will be at or above today's Western living standards. The basis for this forecast is the set of trends contained in this volume, together with the simple economic theory stated in the Introduction.

I also expect, however, that many people will continue to think and say that the material conditions of life are getting worse. This assessment will only become more cheerful when (or if) humanity invents or evolves or stumbles into an invigorating set of new challenges that will (a) capture peoples' imaginations and hearts and wills, and (b) replace the inter-group political struggles that now increasingly supplant the struggle against nature for a better material life.

This pessimistic outlook for our world does not mean, however, that people will be less "happy" about their own lives; about that I have no prediction. I do not predict how the changed material conditions will affect struggles between good and evil, or how increased affluence will change life in the future emotionally, sexually, socially, or spiritually.

Why should you believe this forecast rather than the forecasts made by the doomsayers? Three reasons:

(1) My colleagues and I have been right across the board in the forecasts we have made in the past few decades, whereas the doomsayers have been wrong across the board.

(2) Throughout the long sweep of history, forecasts of resource scarcity have always been heard, and--just as now--the doomsayers have always claimed that the past was no guide to the future because they stood at a turning point in history. But the turning point forecasts have been wrong; there have been ups and downs, but no permanent reversals. In every period those who would have bet on improvement rather than deterioration in fundamental aspects of material life--such as the availability of natural resources--would usually have been right.

(3) I'll bet my money and my reputation on these forecasts, whereas the doomsayers back off from putting their money where their mouths are; they refuse to put either their cash or their names on the line to back what they say. (Indeed, the credibility of the most famous of the doomsayers suffered greatly when in 1980 his group actually did wager on some of his forecasts.) The doomsters' unwillingness to make wager commitments should call into question whether (a) they really believe the dire forecasts that they make, or (b) they just make statements they don't believe in order to scare the public and mobilize the government to do their will.

The Purpose and the Method of the Forecasts

The recorded past of the human enterprise presented in this volume can help us forecast the future. And sound forecasts can help us evolve wise policies so that the future will be to our liking.

The rationale for using statistical evidence far back into the past was given by (or attributed to) Winston Churchill: The further backward you look, the further forward you can see.

A crucial premise for using the past to forecast the future is the constancy of human nature. Along with David Hume and Adam Smith and their Scottish colleagues, and with William James and Friedrich Hayek, I assume that human propensities and appetites, as well as human relationships, will continue to be much the same as they have been; people will change their behavior when changes in conditions give them strong incentive to do so, but only then. This is a fundamental difference from the social commentators of the 1960s who forecast the disappearance of the nuclear family, the decline in the importance of physical beauty and other major changes in the relationship of the sexes, rejection of formal traditions such as the senior prom and evening dress, and the like. This is also unlike the assumption made by Karl Marx--an assumption which, as part of the general theory of communism, might rank as the worst intellectual blunder of all time--that human motivation can be altered so that collective incentives would substitute effectively for individual incentives and private property in inducing hard work and cooperation in impersonal relationships.

It is largely because of these differences in views of human nature that the forecasts to follow differ sharply from the forecasts of most of those who call themselves "futurists." The "futurists" base their predictions mainly on theories drawn from physics, biology, and social science while paying little or no attention to the long time series of history.

It is commonly believed that human activities are less predictable than are phenomena in the physical and biological sciences--that is, that unlike natural-scientific events, human events cannot be forecast accurately. But this common observation is entirely unfounded--and indeed, it is baffling that this is said by anyone who has ever confidently expected a friend to show up for a scheduled date, or gone to a movie whose time and place were advertised in the newspaper. It is true that some human events cannot be predicted well--the winner of the next World Series, and tomorrow's interest rate. But some physical events cannot be predicted well, either--which side a well-flipped coin will fall on, or what the weather will be a year from today.

It also is commonly believed that long-run prediction is more difficult than short-run prediction. Martin Gardner, famous for his writings about mathematical puzzles and scientific fallacies, says that prediction "is like a chess game. You can predict a couple of moves ahead, but it's almost impossible to predict 30 moves ahead." "If it's so hard to be right about a decade, imagine the howlers in store a century hence," says the Wall Street Journal (January 11, 1990, p1). The Wall Street Journal's columnist Lindley H. Clark (1990) put the matter thusly: "Economists have a great deal of trouble predicting the future, and it's unlikely that this unhappy situation ever will change."

It is true that economists cannot predict short-run trends of interest rates, exchange rates, and security prices. The incapacity to forecast short-run economic events is well established scientifically, and there is sound reason in principle for the incapacity.

It is, however, possible to forecast long-run trends with great reliability. Indeed, the most important long-run economic predictions--those I make below--are almost a sure thing, subject only to the qualification that there be no global war or political upheaval.

The method which underlies most of my forecasts is as follows: (1) Array the longest available time series of the phenomenon, and decide whether there is a convincing reason not to consider those data to be a representative sample of the "universe" of experience from which the future experience also is likely to be derived. (2) If there is no compelling reason to reject this past experience as a basis for forecasting the future, consider whether there is a convincing theory to explain the trends it shows. (3) If the long-run data seem relevant, and there is a sound theory to explain them--or even if there is no theory but the data are very many and very consistent--extrapolate the long run trend as the prediction.

Forecasts About Human Welfare

These are my most important long-run predictions, contingent on there being no global war or political upheaval: (1) People will live longer lives than now; fewer will die young. (2) Families all over the world will have higher incomes and better standards of living than now. (3) The costs of natural resources will be lower than at present. (4) Agricultural land will continue to become less and less important as an economic asset, relative to the total value of all other economic assets. These four predictions are quite certain because the very same predictions, made at all earlier times in history, would have turned out to be right. And sound theory explains these benign trends, as discussed in the Introduction to the book.

Almost as certain is that (5) the environment will be healthier than now--that is, the air and water people consume will be cleaner--because as nations continue to get richer, they will increasingly buy more cleanliness as one of the good things that wealth can purchase. People will probably continue to be worried about pollution nevertheless, both because new sorts of pollutions will occur as new kinds of economic activities develop, and because ability to detect pollutions increases. But the danger of the pollutions that catch our attention will diminish, because we address the worst pollutions first and leave the lesser ones for later, and because our capacity to foresee newly created pollutions in advance will increase. And 6) not only will accidents such as fires continue to diminish in number, but losses to natural disasters such as hurricanes and earthquakes will get smaller, as our buildings become stronger and our methods of mitigating disasters improve.

Perhaps the easiest and surest prediction is that (7) nuclear power from fission will account for a growing proportion of our electricity supply, and probably our total energy supply as well, until it is displaced by some other cheaper source of energy (perhaps fusion). (8) Nuclear power will never be displaced by solar energy using the kinds of technology that are currently available, or by any ordinary development of those kinds of technology.

Can one really make almost surefire long-run predictions? Check for yourself: Though the stock market gyrates from day to day and week to week, its course from decade to decade has almost always been upward. The story is the same in reverse with natural resources prices. Copper, iron, wheat, rice, sugar, and every other natural resource has fallen in price, and therefore risen in availability, throughout the two hundred years of U.S. history, and over the thousands of years of human history wherever records exist. Indeed, the history of civilization is a history of increased knowledge to produce goods more efficiently and cheaply. This goes hand in hand with liberty becoming more widespread, and with increased mobility and communication. All this progress is reflected in the long-run trends of human welfare.

The reader may remark on the absence of forecasts about the ozone layer, the warmth of the surface of the earth, and related atmospheric issues, despite the high current interest in them. There are several reasons: (1) My interest is about human welfare and not about physical conditions--that is, skin cancers but not the ozone layer, agriculture but not the warmth of the earth. And I predict that each of the related human welfare measures will show improvement. If the ozone layer or the warmth of the earth truly does threaten aspects of human life, society will use its large modern capacities to alter those conditions, either in the atmosphere or by protecting individuals directly. (2) The record of the doomsayers in forecasting such matters is atrocious. Remember that only a decade or so before the global warming scare got going--in the middle 1970s--the very persons and institutions that now scold us about taking action to reduce global warming were raising the alarm about global cooling. That is, it took only about a decade for the switch from one scenario of doom to the opposite. The worriers about cooling included Science, the most influential scientific journal in the world, quoting an official of the World Meteorological Organization; the National Academy of Sciences worrying about the onset of a 10,000 year ice age; Newsweek, warning that food production could be adversely affected within a decade; the New York Times quoting an official of the National Center for Atmospheric Research; and Science Digest, the science periodical with the largest circulation, writing that

Now ask yourself: How reliable could the evidence for the cooling alarm have been? And in connection with that answer, how reliable could be the evidence for the warming alarm of the 1990s, given that it is mostly composed of exactly the same records over many centuries that made up the evidence for the earlier cooling alarm? (Of course the doomsters err by ignoring most of this history and focusing only on the past few years or decades.) And most important, what would have been the results if we had acted on the recommendations made in connection with the cooling scare?

Will Progress Continue?

Some wonder: How can we be sure that scientific and technical progress will continue indefinitely? Related to this question is another: What will be the rate of economic growth in the future? Elsewhere (Simon, 1992, chapter 19) I conclude that no sensible answer about future rates of advance is possible in principle, in considerable part because of the inherent impossibility of comparative measurement of the value of progress in science from one period to the next.

But uncertainty about the rate of advance in technology does not imply uncertainty about the direction of the future of humankind. Our future material welfare is already assured by our knowledge of how to obtain energy from nuclear fission in unlimited quantities at constant or declining cost, even if no other source of energy is discovered until fissionable material runs out at some almost-infinitely distant time. And energy is the only strong constraint on the supplies of all other raw materials.

Assurance about our raw-material future does not imply absence of need for more technology in the short run or the long run, however. There are, and always will be, endless ways to improve human life, and plenty of pressing problems to challenge us. But we can confidently face the future without worrying about threats to the end of civilization from "over-consumption" and raw-materials shortages that technology is unable to deal with.

The rate of technical advance with respect to raw materials is not crucial for the long run, because the world's raw-material problems have been resolved for all time with technology already developed. (In brief, if energy is sufficiently cheap, all other raw materials can be obtained at low prices, because energy allows extraordinary transformations of many kinds (see Goeller and Weinberg, 1978). And nuclear fission with the breeder--and even more so, nuclear fusion if it becomes practical--provides an unlimited amount of energy at constant or declining cost forever (or at least for billions of years beyond the horizon of any conceivable contemporary social decision).

Space for living and working is the only other resource requiring attention here. Construction technology now provides us space in huge quantity relative to the amount used until now, by building multistory buildings and by heating and cooling areas of the earth heretofore considered unusable for human habitation because of their extreme climates. If we wish to imagine a bit further, the sea and outer space can provide vast additional living space, and even now they are not impracticably costly. An evaluation of future technical advance might tell us how fast the costs of space and energy will fall, but those rates are not crucial to any decision about population growth. For more details, see Barnett and Morse (1963), or Simon (1981, and second edition forthcoming).

Of course it was not always so. In past eras, natural resources constrained human progress. In the present and immediate future, too, additional technology can improve the standard of living more rapidly than otherwise. Nothing said here implies that our future economic problems have been solved, or can be solved for all time. But the problems are less and less those of physical resources.

This leads us to ask what kinds of needs will make technical advance important in the very long run. Health and life come first to mind, of course. But if we accept the contention that our bodies inevitably wear out around age 90 no matter how effectively individual diseases are prevented or controlled, then we are already almost as far as we can go, without much possibility of further advance (see Fries and Crapo, 1981). Of course biogenetics might engineer different bodies for us, making us a different sort of species. It is not obvious that we would consider this an advance, however, and it is too complex and controversial a matter to discuss here.

We certainly would value advances that would help us live our lives with more serenity, excitement, and more enjoyment, in greater harmony with our fellows. We also would greatly value advances that would improve teaching and learning in such fashion that individuals could more fully take advantage of the talents with which they are born, in order to make a greater contribution to others and to live more satisfying lives than otherwise. Science may be able to help. But such knowledge is likely to come from fields other than physical science. Once we enlarge the concept of technology to include social and psychological knowledge, we move to a different sphere of discourse--one in which, for example, the concept of "breakthrough" must have a very different meaning than it has in the physical sciences.

The argument, then, boils down to this: The crucial contributions to living that advances in productive technique might make in the long future differ fundamentally from those that it has made in the past and in the immediate future. We now possess knowledge about resource locations and materials processing that allows us to satisfy our physical needs and desires for food, drink, heat, light, clothing, longevity, transportation, and the recording and transmission of information and entertainment. We can perform these tasks sufficiently well so that additional knowledge on these subjects will not revolutionize life on earth. It still remains to us to organize our institutions, economies, and societies in such fashion that the benefits of this knowledge are available to the vast majority rather than a minority of all people. And our desires for (among other things) leisure, wisdom, love, spirituality, sexuality, adventure, and personal beauty are quite unsatiated, and perhaps must always be so. But the sort of advances in productive knowledge that in the past brought us the possibility of satisfaction for our physical needs cannot sensibly be measured in a fashion comparable to future advances in beneficial knowledge, given our present skills in measurement. Therefore, we should not concern ourselves about the rate of future advances in physical knowledge compared with the rates in the past.

Though I predict that the future of physical discovery will not be like its past, I do not believe that we are at a turning point now. The shift I describe has been going on for a least a century and perhaps much longer, depending on how you view it, and should continue indefinitely. There is no discontinuity to be seen here.

This is not an argument for neglect of scientific and engineering research, of course. I hope that we vigorously continue to increase our technology, and thereby reduce the cost and increase the distribution of the means of satisfaction of our physical needs as, for example, in agricultural research. Furthermore, science is a great human adventure, worthwhile for the observers as well as the participants; space exploration may serve as an example. And even if we do not "need" the technical advances that may occur in the future, we may well find that they are worth far more to us than we would individually be willing to pay for their fruits, in which case there is justification for government support of such activities; space exploration, with the economic benefits it already has begun to provide, may again serve as an example.

One more qualification: Some writers such as Robert Higgs (1987) believe that governments will increase the sizes of their roles in modern economies and societies, which in turn will choke economic progress and even reverse it. In contrast, such writers as George Gilder (1984) and Richard McKenzie and Dwight Lee (1991), believe that technical progress and competition will force governments to play a smaller role. In choosing between these assessments about the future of government there is little historical experience to rely upon. It seems to me relevant, as Stanley Engerman's essay in this volume documents, that slavery has diminished over the centuries. Less reliably, the evidence seems to point toward more freedom and democracy throughout the world since World War II, but the record is scrappy. Hence in this matter we are forced to rely heavily on analysis--that is, the combination of various theoretical arguments and selected supporting factual evidence. And in my judgment, the analysis of Gilder and McKenzie-Lee is more convincing, given the evidence since the mid-1980s.

The two main reasons that I think government will become less powerful are these: (1) The rapid movement across borders of capital and information facilitates sharp competition for resources among firms in different countries, which reduces the power of governments to tax captive businesses and individuals. (2) These new technologies of movement strengthen small enterprises relative to large enterprises, continuing the process that began when electricity became available as a substitute for steam or water power, and the truck became available as a substitute for the railroad. Smaller enterprises are harder for governments to control--both their locations and their activities.

Future fertility in modern countries is another important element about which we lack historical evidence. Will affluent couples continue to have children at a rate that will not increase the population? Or will procreation in rich countries increase sufficiently, while the proportion of the population in now-poor countries falls, to continue the long-run expansion of population on Earth and perhaps elsewhere? More about this below.

Where are We in the Long Sweep of Human Existence?

People alive now are living in the midst of what may well be the most extraordinary three or four centuries in human history. The "industrial revolution" and its technical aftermath--even including the spectacular rise in living standards for most human beings from near subsistence to the level of today's modern nations--is only part of the upheaval. The process has already been completed for perhaps a third of humanity, as described in various chapters in this book, and within a century or two (unless there is a holocaust) the rest of humanity is almost sure to attain the amenities of modern living standards; the worst holocaust imaginable could only delay the process by a century or so.

The most spectacular development, and by far the most meaningful in both human and economic terms, is the revolution in health that we are witnessing in the second part of the twentieth century. Barring catastrophic surprises in the first half of the twenty-first century, most of humanity will come to share the long healthy life that is now enjoyed by the middle-class contemporary residents of the advanced countries.

The technical developments of the past two centuries certainly depended on earlier discoveries. But the knowledge that emerged before the last two centuries was only infrastructure. Until the most recent generations, most people could not observe the effects or gain the benefits of this progress in their own lives. Now we are reaping the full fruits of that earlier investment.

The spreading of a high level of living will be speeded by another phenomenon that can be predicted for sure: increased migration from poor to rich countries. The lure of a higher standard of living pushes migrants from their native countries and pulls them to richer places. And the felt need in the richer countries for youthful persons in the labor force to balance the ever greater concentrations in the older age cohorts fuels the demand for them. One can see the drama of this process in the youthful medical and custodial staffs in big-city hospitals who came from abroad to tend to the aged natives and the veterans of earlier migrations.

Might there not be even more and faster and more radical change in future? In human terms, I doubt it. Life expectancy and child mortality cannot fall much faster unless we change genetically. Concorde-like supersonic speed of travel demonstrably does not matter very much (and the trip to and from airport will take a long time to speed up). Communications cannot become much faster, many being at the speed of light now. The distances one can travel--to the planets and beyond--will eventually increase greatly, and this may alter life significantly, though I cannot imagine how.

The only impending shortage is a shortage of economic shortages. (For investors this implies that profitable investments lie in the economic sectors that profit from affluence. Stay away from commodities; their prices will fall, as they have been falling for hundreds and thousands of years. Sell marginal farm land; it will become less valuable as productivity per acre increases. Buy acreage that was wasteland in the past because it is mountainous or inaccessible; it will now become more profitable for those very characteristics, its recreational value.)

In The Next Two Hundred Years, Herman Kahn, my co-author of the predecessor volume to this one, foresaw this four-century emergence from isolated subsistence farming in which most of humanity has lived throughout history (Kahn, Brown, and Martel, 1976). Herman was frequently "accused" of being an optimist. He would reply, "I'm not an optimist, I'm a realist." Indeed, it is realistic to forecast improving long-run material trends for humanity, forever.

The Future Growth in Education and Opportunity

Chapter 21 shows the increase in the amount of education that young people in the world have been acquiring. This education implies an increase in opportunities to use their talents for their own and their families' benefits; the realization of these talents benefits others in society as well as those persons. This trend is to me one of the most important, and one of the most happy, of all trends in the human enterprise. One can see the results in the nameplates on professors' doors in departments of computer science and chemistry (for example) in universities all over the United States--Asian and African names that would not have been there a decade or two ago. Less and less often will people of genius and strong character live out their entire lives in isolated villages where they cannot contribute to civilization.

Quantitative evidence for the spread of education and of access to knowledge can be seen in the statistics of world education in chapter 21. But the most compelling evidence is found in the stories of individuals such as William Owens (see his astounding autobiography), who grew up just after the turn of the century in Pin Hook, Texas, so poor that he could not get more than a few months of schooling in each of the few years when he got any at all, and could obtain literally nothing to read-- some old newspapers pasted onto the walls of a shack in which he lived, to keep out drafts, were the most he could find for a while. By the time Owens had miraculously become a professor of literature and folklore at Columbia University, access to reading material had become universal in the United States, and there were good schools and even wonderful junior colleges within the reach of just about every American.

Yes, Gutenberg's invention of printing was crucial. But it was the rise in economic productivity that has brought the benefits of that invention within reach of humanity at large. Aside from our victory against premature death in the past century, this spread of education and knowledge may be the most important alteration of all time in human welfare.

As with other aspects of the globalization of a modern standard of living, the process of providing enough education to liberate all young people and to empower them to exercise their talents to the fullest is far from complete. One can still see children sharing rickety desks and scarce books in a near-subsistence Colombian fishing village, just two miles from a busy international airport. Yet the situation there is better than it was just a few years ago when there was no school at all. We can be confident that a century from now scenes like that poor school will be few and far between. The children will have become too valuable to others to allow them to grow up that way.

Increased education does not imply that the public will be more enlightened on crucial issues than now. For example, I do not expect that most people and their political leaders will be much more in favor of truly free trade than now; the idea is simply too counter-intuitive for wide belief; for two hundred years the public has shown that it does not rapidly learn this idea. I do expect that trade will become freer anyway, however, simply because of the pressure of international competition among countries. This is one of the many issues where we can expect that the inherent advantages of certain sorts of regimes--free trade, nuclear power, personal freedom--will gradually win against ideas and desires that run in the opposite direction. Ideas do have consequences, even if they are bad ideas, but the counterproductive consequences are limited and are eventually overcome by economic reality.

The Likelihood of Catastrophic Disease

What about the possibility of a catastrophic disease that could devastate humanity? Many thoughtful people worry that increased human mobility might raise the chance of global disease transmission.

Before considering this possibility, we should note that even a disease of greater magnitude than has ever occurred would only reverse contemporary human progress for a relatively short time. The demographic and economic losses from the worst disaster in history--the Black Plague, which killed perhaps a quarter of the population of major European countries--had been recovered after only a century or so; the population size and the standard of living soon were back almost to where they would have been otherwise.

Furthermore, even a disaster of unprecedented scale--say, a devastation of 90 percent or even 99 percent of humanity--would not have permanent effects. The only essential element for a modern economy and society is the knowledge that resides in libraries. With the books housed there, a small number of people could create what they would need in a matter of decades.

The Necessary Characteristics of a Catastrophic Disease

These are the characteristics that a disease would require to be catastrophic: (1) There must be a "vector"--a mechanism that spreads the disease--of great rapidity and efficiency. (2) The disease must kill or debilitate a large proportion of those who become infected. (3) Most important, the disease must show symptoms and be diagnosed only many years after people become infected.

The importance of a time lag between the infection and the appearance of symptoms is that humanity now has enormous capacity to protect itself against almost any conceivable vector once the disease is known and the vector is sought. The causes of new diseases of the sorts that have occurred in the past--bacterial, viral, environmental, even genetic--nowadays can be determined quickly; it would seem that most imaginable (and even unimaginable) diseases also would reveal their causes to scientists within a very few years. (The main mode of transmission of AIDS was discovered within weeks or months of the diagnosis of the first cases.) And once the vector has been identified--whether it be by air or water or insect bite or whatever--nowadays it is within our capabilities to block that transmission effectively. (Sexual transmission is the most difficult to prevent, but because a large proportion of the population is either monogamous or not sexually active, a sexually-transmitted disease could not kill a majority of the human population, let alone almost everyone.) Therefore, only if there is a long lag could a disease transmitted through the air or water manage to infect a large proportion of humanity. (If the elapsed time between being infected and showing symptoms were not so long in the case of AIDS, it would have done less harm.)

Our Growing Ability to Deal with Catastrophic Disease

It is also relevant that our capacity to learn quickly and deal rapidly with new diseases has expanded enormously over the centuries and the last few decades. The first AIDS case was diagnosed only a decade before the time of writing this in 1992. And we should note the beneficial spin-offs of new knowledge due to the onset of new diseases that will help check diseases in the future.

Absolute and Relative Progress

The predictions in this chapter are for the absolute progress of humanity as a whole, in keeping with the spirit and title of this volume. The public and the press are often--much too often, in my view--interested in the relative achievements of particular countries and groups, as discussed in the Introduction to the volume. The historical trends that are the foundations for the predictions in this chapter do not support solid predictions for particular countries and groups except in one respect: In light of the data in the appendix to Chapter 15, communities may be expected to converge in their standards of living in the long run.

Nevertheless, I hazard a few weak predictions about relative progress: With respect to Eastern Europe, the ex-Soviet Union has the benefit of a large educated class. But even so, it and the other Eastern European nations will need decades to create the legal and institutional infrastructure to support solid economic growth; this is the key element, in my view. Indeed, I expect the ex-Soviet Union countries to lag far behind several of the other Eastern European countries.

A hundred years from now China or India could be the leading nation in the world. If freedom wins out fairly soon in China, and if people in those two countries are reasonably wise about reconstructing their economic institutions to enable enterprise to flourish, a century could be more than enough time for them to nearly catch up economically with the leading countries in the world. After all, Hong Kong caught up more than halfway in less than half a century, and events are likely to move even faster in the future. If so, the sheer demographic weight of China and India is likely to dominate all other countries. They are then likely to exert leadership in various international forums.

Bets are off if India and China break up into smaller nations, of course. To my mind, there is little bad about such breakups, and it may benefit the individuals in the smaller units. But as Europe has shown, such splitting does not make for world dominance. Perhaps with enough splitting, no nation will be a super power. That might be the best world of all.

(Is international leadership a good thing? Maybe not. But if one does want the leadership role for the United States or another country, one should wish that its population increases rapidly rather than slowly, because that may be the only way to delay India's and China's surge to leadership.)

Power of democracy. Fears before WWII. Policies and Carter.

A shocking last prediction: The economic reasons for war diminish as land becomes less important relative to other assets and therefore less worth spending money and lives to annex. I predict that this trend will reduce the incidence of war in the long run, though I agree with writers who argue that the economic element is not the only crucial determinant of war.

Conditions Getting Better,  Perceptions Getting Worse

Even though the material conditions of life have been getting better, many people believe that conditions have been getting worse. The Introduction began by illustrating this process. The title of a news article conveys the flavor of the matter: "Down in the Dumps - The Glooming of America: If the numbers aren't so bad, why is the country feeling so lousy?" (Newsweek, January 13, 1992).

A curiosity: My mother's life spanned almost half of the past two-century revolutionary period. She was born in 1900 and saw her only child saved from death at age 7 by the first new wonder drug. In her eighties she knew that her friends had mostly lived extraordinarily long lives. She recognized the convenience and comfort provided by such modern inventions as the telephone, air conditioning, and airplanes. And yet she disagreed when I said the conditions of life had markedly improved. When I asked Mother why she still thought things have gotten worse, she replied: "The headlines in the newspaper are all bad."

Journalism will get worse for at least a while into the future, as it covers a smaller proportion of its traditional stories--fires, politics, and local events--and covers more events for which its traditional techniques are not fitted -- scientific developments, especially concerning the environment, social scientific trends, and other matters that require more than first hand observation and individual interviews. Where this will end is not clear to me. Training of journalists in non-traditional techniques may be in the cards, but probably will never cure this problem because it is inherent in covering stories quickly as "news" without historical digging.

Scientific research will become more and more involved in advanced technique, which will mean that fewer exciting problems will be worked on, and science will become a less attractive field for creative persons.

We will always find grounds for worry. Apparently it is a built in property of our mental systems that no matter how good things become, our aspiration levels ratchet up so that our anxiety levels decline hardly at all, and we focus on ever smaller actual dangers. Parents manage to worry about their kids' health and safety even though the mortality of children is spectacularly lower than in prior decades and centuries. And orthodox Jews and Muslims in the United States continue to worry about whether their food is ritually pure even though the protections against ritual contamination are remarkably better than in the past. (Once upon a time orthodox Jews said that "A Jew eats a small pig every year without knowing it." Nowadays, with plastic wrapping at the factory, and the microscopic examination techniques of modern science, the level of purity is much higher than in the past. But the level of concern does not abate.)

Remember please that there are fewer life-threatening disasters from decade by decade. Some evidence for this is found in statistics of accidents (see chapter 9). Other evidence may be seen in the headlines of newspapers, which less and less frequently concern earthquakes, fires, and floods, and more and more are about political and social issues. Surely this trend will continue for the foreseeable future. Fewer and fewer of our struggles will be against nature, and more and more will be battles of one group versus another. This suggests that until we find new challenges--such as terraforming other planets--we will be caught up in zero-sum issues that are less likely to satisfy the spirit than are the battles against nature that society tends to win.

The Belief in Progress

A hundred years ago belief in continued progress and a bright future was commonplace. Why not now?

One reason for the loss of belief in progress is the focus of the media on bad things happening, a phenomenon discussed in the Introduction and the section above. But another reason might well be the shattering blow to people's confidence that World War II inflicted. As the novelist Stefan Zweig wrote in his autobiography, The World of Yesterday, (University of Nebraska Press/Viking Press, 1943/1964),

Since Zweig wrote those lines during World War II, just about every change important to humankind has been for the better--and the trends have been dramatic in their extents. But this apparently has not been enough to convince people that World War II was not an anomaly and is not likely to happen again in the foreseeable future.

But this may be wrong, too. A generally thoughtful columnist recently wrote: "We have lost our conviction that things will always get better" (Richard Cohen, "Progress Ain't What It Used to Be," Washington Post Magazine, Oct. 13, 1991, p. 7). Maybe people never had the conviction that things would always get better.

The Crucial Need for Important Challenges

Frank Knight once wrote that what people most seek is not to have their wants fulfilled, but bigger and better wants. This may not be true of those who are cold and hungry at the moment, or of adolescents driven wild by their hormones, or of harried parents trying to be in three places at once. But it certainly is true of many middle-class people who have acquired the physical appurtenances they consider they need, and who have succeeded in their own eyes in their professions. And it is true of many young people who do not see on their horizons exciting challenges to their talents and ambitions--no crusades or jihads to defeat an infidel, no new continents to discover, no frontier from which to hack out a homestead. As James Buchanan put it, "I do not envy the youngsters in modern suburbia, who lack a sense of scarcity along any [material] dimension" (1992, p. 23).

Anecdotal history shows the need for challenging problems. I heard Dutch people say about themselves in the 1990s that they are gloomy now but that in the 1950s, when Holland was still rebuilding after the war, the national mood was very much more cheery. Today every corner of the Netherlands seems already to have been improved and neatened. And there is discussion there of removing from agricultural use some of the fertile land that earlier was taken at such great effort from the sea, because the agricultural produce from that acreage is no longer needed. The Netherlands' worst problem, they say, is the disposal of millions of tons of pig excrement that they have not yet found uses for. This is not the sort of problem that fires the imaginations of the young.

More and more, as affluence spreads throughout humanity, our species' biggest problem will be a lack of satisfying challenges--opportunities to sacrifice, to make a large contribution to a larger cause, to be part of a team, to achieve nobility--truly William James' "moral equivalent of war." That's what the environmental activities now seem to offer. But they are flawed because they are mainly retentive, rather than creative (a subject I discuss in more detail in Simon (1981; forthcoming).

A vast expansion of the human population could present such a challenge and might lead to buccaneering expeditions to conquer outer space. But the future course of fertility (upon which population growth will depend almost solely, because further mortality reduction will not be great) is not predictable as of now.

Only such new challenges, I believe, can prevent us from descending into C. S. Lewis' vision of the netherworld: "We must picture Hell as a state where everyone is perpetually concerned about his own dignity and advancement [and I would add, the dignity and advancement of the racial, religious, ethnic, national, and other groups one is a member of], where everyone has a grievance, and where everyone lives the deadly serious passion of envy, self-importance and resentment." (From The Screwtape Letters, quoted in The Washington Post, Jan. 17, 1993, C4).

In the past, family resources constrained family size. But the evidence suggests that as average income continues to grow, it is likely--though by no means certain--that fertility and money income are becoming increasingly separated. That is, family size at incomes much higher than now in the U.S. might still be of the same order as in average U.S. or European families today. Indeed, the family size of the highest income people today is not particularly large. Families in the super-wealthy future may be bigger, or smaller, than now. Income is not likely to be a good predictor of what would happen if incomes climb to the point at which additional income does not matter. And if income and fertility do become increasingly separated, the biggest changes in fertility may then be associated with one or the other sort of fear, either the fear of depopulation as in the 1930s, or the fear of overpopulation as in the late 1960s and into the 1970s in the United States and China. The overall result may be a series of rises and falls in fertility, triggered by, and in turn triggering, these fears. This sequence might bear little or no relationship to basic economic conditions, as in fact there was no basic economic difference in the two periods that would explain the depopulation and overpopulation fears in the 1930s and 1960s.

It may be that relative income is the key factor, as Richard Easterlin (1968) has argued. If so, fertility may continue to be affected by fluctuations over time and by the shape of the income distribution. Only the far future will tell the answers to these speculations, however.

WHAT WILL DETERMINE THE FUTURE?

Though I greatly admire much of von Mises' economics, I consider the above remark as exemplifying the megalomania of the intellectual class. Curiously, von Mises and Hayek agree on this point with J. M. Keynes. Hayek in 1944 said, "I agree with Lord Keynes that `the ideas of economists and political philosophers, both when they are right and when they are wrong, are more powerful than is commonly understood. Indeed, the world is ruled by little else'" (Hayek, 1991, p. 36).

All of us like to think we are important--intellectuals certainly as much as anyone. And yes, ideas can be powerful in the intermediate run--witness the disaster caused by Marxist thinking for seventy years in Eastern Europe and China. But in the longer run, the elemental forces of peoples' desires to carve out a good living for themselves and for their families, to have children and raise them happily and well-educated, to employ ones' talents and energies and to enjoy their fruits--these forces will eventuate in government policies that allow people these fundamental freedoms. There probably always will be temporary reversals and reversions to totalitarianism for a while. But we can hope that in an ever-ramified world where people can move ever more freely, these reversions will be of shorter duration and of lesser magnitude.

If ideas were all-important, the horde of more-or-less sensible economists descending (literally) on Eastern Europe should be able to put things straight in a hurry. But we will see that decades of evolutionary institutional rebuilding will be necessary; no set of grand ideas that replace that necessary work.

All that is needed from philosophers and economists is that they manage to prise from rulers a small chink of living and operating room for individuals, and some degree of rule of law. All the rest will be done by individuals themselves, without recourse to any grand ideas. Indeed, this is the very doctrine of von Mises and Hayek--and Friedman, Smith, and Hume. In this rare respect, Hayek and von Mises contradict themselves. They all know the power of black markets even in the teeth of the most fearsome sanctions. Such markets are not driven by grand ideas, but by human desires and economic incentives.

The more that humanity progresses, the less these ideas will matter, because the variety of regimes offered competitively by the various countries, and the easy mobility among them, will provide the necessary opportunities for entrepreneurs and other talented persons. The need grows less for philosophers of liberty to eke out a bit of freedom for society from the clutches of politicians intoxicated with the chance to put into operation their delusions of improvement by central control (theirs). People will achieve it anyway.

On the other hand, with greater progress comes greater freedom from pressing survival needs, which in turn enables people to indulge themselves in foolish, irrational, and counter-productive thinking, and can lead to mass movements that impede progress. (We might note that farmers and small retailers, who are of necessity in exceedingly close touch with economic reality, are-- at least I so think--relatively free of foolish economic thinking, if only as the result of a Darwinian process.)

THE BRIEF FORECAST AGAIN

Whatever nature has produced that we use--food, oil, diamonds--humankind now can also produce, and faster than nature. An expectancy of health and a standard of living higher than that which any prince enjoyed two hundred years ago is the birthright of every middle-class and working-class person in developed countries, and of most people in poverty as well. What is still to come is to bring these material gains to all groups of humanity. That may take half a century or a century. Yet that benign outcome may be predicted with high likelihood--a happy vision, indeed.

The future for the correct perception of these trends looks bleak, due to their portrayal in the press, however. The techniques that journalists use so well to cover fires and local politics do not work well for matters that go beyond first-hand observation. This includes scientific matters, as illustrated nowadays by environmental questions. And the bad-news bias in journalism turns every story negative even if the underlying facts are positive. This leads the public to think that conditions in general are getting worse. The press then reports this as pessimism. All this could have increasingly dire effects upon the public mood.

As to the non-material aspects of human existence--good luck to us.

References

• Barnett, Harold J., and Chandler Morse, (1963). "Scarcity and Growth: the Economics of Natural Resource Availability." Baltimore: Johns Hopkins.

• Bray, Anna J., (1991). "The Ice Age Cometh," Policy Review, Fall, 82-4.

• Buchanan, James, (1992). "Better Than Plowing, And Other Essays." Chicago: University of Chicago Press.

• Clark, Lindley H. Jr., "Housing May Be In for a Long Dry Spell," Wall Street Journal, January 19, 1990, p. A10

• Easterlin, Richard A., (1968). "Population, Labor Force, and Long Swings in Economic Growth." New York: National Bureau of Economic Research.

• Fries, James F., and Lawrence M. Crapo, (1981). "Vitality and Aging." San Francisco: W. H. Freeman and Company, 1981.

• Gilder, George, (1984). "The Spirit of Enterprise." New York: Simon and Schuster.

• Goeller, H. E., and A. M. Weinberg, (1978). "The Age of Substitutability," Science 191:683-9.

• Hayek, Friedrich, (1991). "On Becoming an Economist", in his The Trend of Economic Thinking. Chicago: University of Chicago Press.

• Higgs, Robert, (1987). "Crisis and Leviathan." New York: Oxford.

• Kahn, Herman, with William Brown and Leon Martel, (1976). "The Next 200 Years." New York: Morrow.

• McKenzie, Richard B., and Dwight R. Lee, (1991). "Quicksilver Capital." New York: Free Press.

• Owens, William, "This Stubborn Soil" (New York: Vintage, 1986)

• Simon, Julian L., (1981). "The Ultimate Resource." Princeton: Princeton University Press, second edition forthcoming, 1995 .

• --- (1992). "Population Growth and Economic Development in Poor Countries." Princeton: Princeton University Press, 1992.

• Weisbrod, Burton A., (1962). "An Expected-Income Measure of Economic Welfare," The Journal of Political Economy, August, 355-67.