The Rational Optimist (P.S.)

by Matt Ridley

The more human beings diversified as consumers and specialised as producers, and the more they then exchanged, the better off they have been, are and will be. And the good news is that there is no inevitable end to this process. The more people are drawn into the global division of labour, the more people can specialise and exchange, the wealthier we will all be. Moreover, along the way there is no reason we cannot solve the problems that beset us, of economic crashes, population explosions, climate change and terrorism, of poverty, AIDS, depression and obesity. It will not be easy, but it is perfectly possible, indeed probable, that in the year 2110, a century after this book is published, humanity will be much, much better off than it is today, and so will the ecology of the planet it inhabits. This book dares the human race to embrace change, to be rationally optimistic and thereby to strive for the betterment of humankind and the world it inhabits.

Since 1800, the population of the world has multiplied six times, yet average life expectancy has more than doubled and real income has risen more than nine times. Taking a shorter perspective, in 2005, compared with 1955, the average human being on Planet Earth earned nearly three times as much money (corrected for inflation), ate one-third more calories of food, buried one-third as many of her children and could expect to live one-third longer. She was less likely to die as a result of war, murder, childbirth, accidents, tornadoes, flooding, famine, whooping cough, tuberculosis, malaria, diphtheria, typhus, typhoid, measles, smallpox, scurvy or polio. She was less likely, at any given age, to get cancer, heart disease or stroke. She was more likely to be literate and to have finished school. She was more likely to own a telephone, a flush toilet, a refrigerator and a bicycle. All this during a half-century when the world population has more than doubled, so that far from being rationed by population pressure, the goods and services available to the people of the world have expanded. It is, by any standard, an astonishing human achievement.

Averages conceal a lot. But even if you break down the world into bits, it is hard to find any region that was worse off in 2005 than it was in 1955. Over that half-century, real income per head ended a little lower in only six countries (Afghanistan, Haiti, Congo, Liberia, Sierra Leone and Somalia), life expectancy in three (Russia, Swaziland and Zimbabwe), and infant survival in none. In the rest they have rocketed upward. Africa’s rate of improvement has been distressingly slow and patchy compared with the rest of the world, and many southern African countries saw life expectancy plunge in the 1990s as the AIDS epidemic took hold (before recovering in recent years). There were also moments in the half-century when you could have caught countries in episodes of dreadful deterioration of living standards or life chances – China in the 1960s, Cambodia in the 1970s, Ethiopia in the 1980s, Rwanda in the 1990s, Congo in the 2000s, North Korea throughout. Argentina had a disappointingly stagnant twentieth century. But overall, after fifty years, the outcome for the world is remarkably, astonishingly, dramatically positive.

Despite a doubling of the world population, even the raw number of people living in absolute poverty (defined as less than a 1985 dollar a day) has fallen since the 1950s. The percentage living in such absolute poverty has dropped by more than half – to less than 18 per cent. That number is, of course, still all too horribly high, but the trend is hardly a cause for despair: at the current rate of decline, it would hit zero around 2035 – though it probably won’t. The United Nations estimates that poverty was reduced more in the last fifty years than in the previous 500.

Even inequality is declining worldwide. It is true that in Britain and America income equality, which had been improving for most of the past two centuries (British aristocrats were six inches taller than the average in 1800; today they are less than two inches taller), has stalled since the 1970s. The reasons for this are many, but they are not all causes for regret. For example, high earners now marry each other more than they used to (which concentrates income), immigration has increased, trade has been freed, cartels have been opened up to entrepreneurial competition and the skill premium has grown in the work place. All these are inequality-boosting, but they stem from liberalising trends. Besides, by a strange statistical paradox, while inequality has increased within some countries, globally it has been falling.

Much of this improvement is not included in the cost-of-living calculations, which struggle to compare like with unlike. The economist Don Boudreaux imagined the average American time-travelling back to 1967 with his modern income. He might be the richest person in town, but no amount of money could buy him the delights of eBay, Amazon, Starbucks, Wal-Mart, Prozac, Google or BlackBerry. The lighting numbers cited above do not even take into account the greater convenience and cleanliness of modern electric light compared with candles or kerosene – its simple switching, its lack of smoke, smell and flicker, its lesser fire hazard.

Housing, too, is itching to get cheaper, but for confused reasons governments go to great lengths to prevent it. Where it took sixteen weeks to earn the price of 100 square feet of housing in 1956, now it takes fourteen weeks and the housing is of better quality. But given the ease with which modern machinery can assemble a house, the price should have come down much faster than that. Governments prevent this by, first, using planning or zoning laws to restrict supply (especially in Britain); second, using the tax system to encourage mortgage borrowing (in the United States at least – no longer in Britain); and third, doing all they can to stop property prices falling after a bubble. The effect of these measures is to make life harder for those who do not yet have a house and massively reward those who do. To remedy this, governments then have to enforce the building of more affordable housing, or subsidise mortgage lending to the poor.

Getting richer is not the only or even the best way of getting happier. Social and political liberation is far more effective, says the political scientist Ronald Ingleheart: the big gains in happiness come from living in a society that frees you to make choices about your lifestyle – about where to live, who to marry, how to express your sexuality and so on. It is the increase in free choice since 1981 that has been responsible for the increase in happiness recorded since then in forty-five out of fifty-two countries. Ruut Veenhoven finds that ‘the more individualized the nation, the more citizens enjoy their life.’

As long as new ideas can breed in this way, then human economic progress can continue. It may be only a year or two till world growth resumes after the current crisis, or it may for some countries be a lost decade. It may even be that parts of the world will be convulsed by a descent into autarky, authoritarianism and violence, as happened in the 1930s, and that a depression will cause a great war. But so long as somewhere somebody is incentivised to invent ways of serving others’ needs better, then the rational optimist must conclude that the betterment of human lives will eventually resume.

By definition, you are at subsistence level and frankly, though at first you mutter, Thoreau-like, ‘how marvellous to get away from all the appalling hustle and bustle’, after a few days the routine is pretty grim. If you wish to have even the most minimal improvement in your life – say metal tools, toothpaste or lighting – you are going to have to get some of your chores done by somebody else, because there just is not time to do them yourself. So one way to raise your standard of living would be to lower somebody else’s: buy a slave. That was indeed how people got rich for thousands of years.

As I write this, it is nine o’clock in the morning. In the two hours since I got out of bed I have showered in water heated by North Sea gas, shaved using an American razor running on electricity made from British coal, eaten a slice of bread made from French wheat, spread with New Zealand butter and Spanish marmalade, then brewed a cup of tea using leaves grown in Sri Lanka, dressed myself in clothes of Indian cotton and Australian wool, with shoes of Chinese leather and Malaysian rubber, and read a newspaper made from Finnish wood pulp and Chinese ink. I am now sitting at a desk typing on a Thai plastic keyboard (which perhaps began life in an Arab oil well) in order to move electrons through a Korean silicon chip and some wires of Chilean copper to display text on a computer designed and manufactured by an American firm. I have consumed goods and services from dozens of countries already this morning. Actually, I am guessing at the nationalities of some of these items, because it is almost impossible to define some of them as coming from any country, so diverse are their sources.

So this is what poverty means. You are poor to the extent that you cannot afford to sell your time for sufficient price to buy the services you need, and rich to the extent that you can afford to buy not just the services you need but also those you crave. Prosperity, or growth, has been synonymous with moving from self-sufficiency to interdependence, transforming the family from a unit of laborious, slow and diverse production to a unit of easy, fast and diverse consumption paid for by a burst of specialised production.

If hunter-gatherers appeared lithe and healthy it was because the fat and slow had all been shot in the back at dawn. Here is the data. From the !Kung in the Kalahari to the Inuit in the Arctic, two-thirds of modern hunter-gatherers have proved to be in a state of almost constant tribal warfare, and 87 per cent to experience annual war. War is a big word for dawn raids, skirmishes and lots of posturing, but because these happen so often, death rates are high – usually around 30 per cent of adult males dying from homicide. The warfare death rate of 0.5 per cent of the population per year that was typical of many hunter-gatherer societies would equate to two billion people dying during the twentieth century (instead of 100 million).

The long shadow of the future hangs over any transaction with your local shopkeeper. He surely knows that in making a quick buck now by ripping you off he risks losing all future purchases you might make. What is miraculous is that in modern society you can trust and be trusted by a shopkeeper you do not know. Almost invisible, the guarantors of trust lurk beneath every modern market transaction: the sealed packaging, the warranty, the customer feedback form, the consumer legislation, the brand itself, the credit card, the ‘promise to pay the bearer’ on the money. When I go into a well-known supermarket and pick up a tube of toothpaste of a well-known brand, I do not need to open the package and squirt a little toothpaste on to my finger to test that the tube is not filled with water; I do not even need to know that the shop is subject to laws that would prosecute it for selling false goods. I just need to know that this big retailing company, and the big company that made the toothpaste, are both keen to keep me coming back year after year, that the shadow of reputational risk hangs over this simple transaction, ensuring that I can trust this toothpaste seller without a moment’s thought.

Zero-sum thinking dominates the popular discourse, whether in debates about trade or in complaints about service providers. You just don’t hear people coming out of shops saying, ‘I got a great bargain, but don’t worry, I paid enough to be sure that the shopkeeper feeds his family, too.’ Michael Shermer thinks that is because most of the Stone Age transactions rarely benefited both sides: ‘during our evolutionary tenure, we lived in a zero-sum (win-lose world), in which one person’s gain meant another person’s loss’. This is a shame, because the zero-sum mistake was what made so many -isms of past centuries so wrong. Mercantilism said that exports made you rich and imports made you poor, a fallacy mocked by Adam Smith when he pointed out that Britain selling durable hardware to France in exchange for perishable wine was a missed opportunity to achieve the ‘incredible augmentation of the pots and pans of the country’. Marxism said that capitalists got rich because workers got poor, another fallacy.

the film Wall Street, the fictional Gordon Gekko not only says that greed is good; he also adds that it’s a zero-sum game where somebody wins and somebody loses. He is not necessarily wrong about some speculative markets in capital and in assets, but he is about markets in goods and services. The notion of synergy, of both sides benefiting, just does not seem to come naturally to people. If sympathy is instinctive, synergy is not. For most people, therefore, the market does not feel like a virtuous place. It feels like an arena in which the consumer does battle with the producer to see who can win. Long before the credit crunch of 2008 most people saw capitalism (and therefore the market) as necessary evils, rather than inherent goods. It is almost an axiom of modern debate that free exchange encourages and demands selfishness, whereas people were kinder and gentler before their lives were commercialised, that putting a price on everything has fragmented society and cheapened souls. Perhaps this lies behind the extraordinarily widespread view that commerce is immoral, lucre filthy and that modern people are good despite being enmeshed in markets rather than because of it

Like biological evolution, the market is a bottom-up world with nobody in charge. As the Australian economist Peter Saunders argues, ‘Nobody planned the global capitalist system, nobody runs it, and nobody really comprehends it. This particularly offends intellectuals, for capitalism renders them redundant. It gets on perfectly well without them.’ There is nothing new about this. The intelligentsia has disdained commerce throughout Western history.

The rapid commercialisation of lives since 1800 has coincided with an extraordinary improvement in human sensibility compared with previous centuries, and the process began in the most commercial nations, Holland and England. Unimaginable cruelty was commonplace in the precommercial world: execution was a spectator sport, mutilation a routine punishment, human sacrifice a futile tragedy and animal torture a popular entertainment. The nineteenth century, when industrial capitalism drew so many people into dependence on the market, was a time when slavery, child labour and pastimes like fox tossing and cock fighting became unacceptable. The late twentieth century, when life became still more commercialised, was a time when racism, sexism and child molesting became unacceptable. In between, when capitalism gave way to various forms of state-directed totalitarianism and their pale imitators, such virtues were noticeable by their retreat – while faith and courage revived. The twenty-first century, when commercialisation has so far continued to spread, is already a time when battery farming and unilaterally declaring war have just about become unacceptable. Random violence makes the news precisely because it is so rare; routine kindness does not make the news precisely because it is so commonplace.

Commerce is good for minorities, too. If you don’t like the outcome of an election you have to lump it; if you don’t like your hairdresser, you can find another. Political decisions are by definition monopolistic, disenfranchising and despotically majoritarian; markets are good at supplying minority needs. The other day I bought a device for attaching a fly-fishing rod to my car. How long would I have had to wait in 1970s Leningrad before some central planner had the bright idea of supplying such a trivial need? The market found it. Moreover, thanks to the internet, the economy is getting better and better at meeting the desires of minorities. Because the very few people in the world who need fishing rod attachments or books on fourteenth-century suicide can now find suppliers on the web, niches are thriving. The ‘long tail’ of the distribution – the very many products that are each wanted by very few, rather than vice versa – can be serviced more and more easily.

The sexual and political liberation of women in the 1960s followed directly their domestic liberation from the kitchen by labour-saving electrical machinery. Lower-class women had always worked for wages – tilling in fields, sewing in sweatshops, serving in parlours. Among the upper-middle classes, though, it was a badge of rank, handed down from the feudal past, to be or to have a non-working (or at least housekeeping) wife. In the 1950s many suburban men, returning from war, found they too could afford such an accessory, and many women were pressured into giving their battleship-welding jobs back to men. In the absence of economic change, that is probably how it would have stayed, but soon the opportunities to work outside the home grew as the time spent on increasingly mechanised housework dwindled, and it was this, as much as any political awakening, that enabled the feminist movement to gain traction in the 1960s.

For Adam Smith capital is ‘as it were, a certain quantity of labour stocked and stored up to be employed, if necessary, upon some other occasion’. If you can store the labour of others for future use, then you can spare yourself the time and the energy of working for your own immediate needs, which means you can invest in something new that will bring even greater reward. Once capital had arrived on the scene, innovation could accelerate, because time and property could be invested in projects that initially generated no benefit. Few hunter-gatherers, for example, could ever afford the time off ‘work’ to build a furnace and slowly and laboriously smelt enough metal to make a copper axe: they would starve in the meantime – even if they could find a market for the axes.

If the average yields of 1961 had still prevailed in 1998, then to feed six billion people would have required the ploughing of 7.9 billion acres, instead of the 3.7 billion acres actually ploughed in 1998: an extra area the size of South America minus Chile. And that’s optimistically assuming that yields would have remained at the same level in the newly cultivated land, taken from the rainforests, the swamps and the semi-deserts. If yields had not increased, therefore, rainforests would have been burnt, deserts irrigated, wetlands drained, tidal flats reclaimed, pastures ploughed – to a far greater extent than actually happened. To put it another way, today people farm (i.e., plough, crop or graze) just 38 per cent of the land area of the earth, whereas with 1961 yields they would have to farm 82 per cent to feed today’s population. Intensification has saved 44 per cent of this planet for wilderness. Intensification is the best thing that ever happened – from the environmental perspective. There are now over two billion acres of ‘secondary’ tropical rainforest, regrowing after farmers left for the cities, and it is already almost as rich in biodiversity as primary forest. That is because of intensive farming and urbanisation.

Human beings comprise about 0.5 per cent by weight of the animals on the planet. Yet they beg, borrow and steal for themselves roughly 23 per cent of the entire primary production of land plants (the number is much lower if the oceans are included). This number is known to ecologists as the HANPP – the ‘human appropriation of net primary productivity’. That is to say, of the 650 billion tonnes of carbon potentially absorbed from the air by land plants each year, eighty are harvested, ten are burnt and sixty are prevented from growing by ploughs, streets and goats, leaving 500 to support all the other species.

Politicians can make my prediction fail. Should the world decide to go organic – that is, should farming get its nitrogen from plants and fish rather than direct from the air using factories and fossil fuels – then many of the nine billion will starve and all rainforests will be cut down. Yes, I wrote ‘all’. Organic farming is low-yield, whether you like it or not. The reason for this is simple chemistry. Since organic farming eschews all synthetic fertiliser, it exhausts the mineral nutrients in the soil – especially phosphorus and potassium, but eventually also sulphur, calcium and manganese. It gets round this problem by adding crushed rock or squashed fish to the soil. These have to be mined or netted. Its main problem, though, is nitrogen deficiency, which it can reverse by growing legumes (clover, alfalfa or beans), which fix nitrogen from the air, and either ploughing them into the soil or feeding them to cattle whose manure is then ploughed into the soil. With such help a particular organic plot can match non-organic yields, but only by using extra land elsewhere to grow the legumes and feed the cattle, effectively doubling the area under the plough. Conventional farming, by contrast, gets its nitrogen from what are in effect point sources – factories, which fix it from the air.

This is just one example of how the organic movement’s insistence on freezing agricultural technology at a midtwentieth-century moment means it misses out on environmental benefits brought by later inventions. ‘I’m so tired of people who wouldn’t visit a doctor who used a stethoscope instead of an MRI demanding that farmers like me use 1930s technology to raise food,’ writes the Missouri farmer Blake Hurst. Organic farmers are happy to spray copper sulphate or nicotine sulphate, but forbid themselves the use of synthetic pyrethroids, which swiftly kill insects but have very low toxicity for mammals and do not persist in the environment causing collateral damage to non-pests. They forbid themselves herbicides, which means they have to weed by hand, using poorly paid labour, or by tilling and flame-throwing, which can devastate soil fauna, accelerate soil erosion and release greenhouse gases. They forbid themselves fertiliser made from air, but allow themselves fertiliser made from trawled fish.

By 2008, less than twenty-five years after they were first invented, fully 10 per cent of all arable land, thirty million acres, was growing genetically modified crops: one of the most rapid and successful adoptions of a new technology in the history of farming. Only in parts of Europe and Africa were these crops denied to farmers and consumers by the pressure of militant environmentalists, with what Stewart Brand calls their ‘customary indifference to starvation’. African governments, after intense lobbying by Western campaigners, have been persuaded to tie genetically modified food in red tape, which prevents them being grown commercially in all but three countries (South Africa, Burkina Faso and Egypt). In one notorious case Zambia in 2002 even turned down food aid in the middle of a famine after being persuaded by a campaign by groups, including Greenpeace International and Friends of the Earth, that because it was genetically modified it could be dangerous. A pressure group even told a Zambian delegation that GM crops might cause retroviral infections. Robert Paarlberg writes that, ‘Europeans are imposing the richest of tastes on the poorest of people.’ Ingo Potrykus, developer of golden rice, thinks that ‘blanket opposition to all GM foods is a luxury that only pampered Westerners can afford.’ Or as the Kenyan scientist Florence Wambugu puts it, ‘You people in the developed world are certainly free to debate the merits of genetically modified foods, but can we eat fi...

The economist Karl Polanyi argued in the 1950s that the concept of the market cannot be applied to any time before the fourth century BC, that until then instead of supply, demand and price, there was reciprocal exchange, state-sponsored redistribution of goods and top-down treaty trade in which agents were sent abroad to acquire things on behalf of the palace. Trade was administered, not spontaneous. But Polanyi’s thesis or those of his fellow ‘substantivists’ has not stood the test of time well. It now seems that the state did not so much sponsor trade, as capture it. The more that comes to light about ancient trade, the more bottom-up it looks. While it is true that some Akkadian merchants may well have eventually seen themselves partly as civil servants sent abroad to acquire goods for their rulers, even they earned a living by trading for a profit themselves. Polanyi depicted a reflection of his own planning-obsessed times. The dirigiste mentality that dominated the second half of the twentieth century was always asking who is in charge, looking for who decided on a policy of trade. That is not how the world works. Trade emerged from the interactions of individuals. It evolved. Nobody was in charge.

In these Bronze Age empires, commerce was the cause, not the symptom of prosperity. None the less, a free trade area lends itself easily to imperial domination. Soon, through tax, regulation and monopoly, the wealth generated by trade was being diverted into the luxury of the few and the oppression of the many. By 1500 BC you could argue that the richest parts of the world had sunk into the stagnation of palace socialism as the activities of merchants were progressively nationalised. Egyptian, Minoan, Babylonian and Shang dictators ruled over societies of rigid dirigisme, extravagant bureaucracy and feeble individual rights, stifling technological innovation, crowding out social innovation and punishing creativity. A Bronze Age empire stagnated for much the same reason that a nationalised industry stagnates: monopoly rewards caution and discourages experiment, the income is gradually captured by the interests of the producers at the expense of the interests of the consumers, and so on. The list of innovations achieved by the pharaohs is as thin as the list of innovations achieved by British Rail or the US Postal Service.

This is not to say that democratic city states are the only places where economic progress can occur, but it is to discern a pattern. Plainly, there is something beneficial to the growth of the division of labour when governments are limited (though not so weak that there is widespread piracy), republican or fragmented. The chief reason is surely that strong governments are, by definition, monopolies and monopolies always grow complacent, stagnant and self-serving. Monarchs love monopolies because where they cannot keep them to themselves, they can sell them, grant them to favourites and tax them. They also fall for the perpetual fallacy that they can make business work more efficiently if they plan it rather than allow and encourage it to evolve. The scientist and historian Terence Kealey points out that entrepreneurs are rational and if they find that wealth can more easily be stolen than created, then they will steal it: ‘Humanity’s great battle over the last 10,000 years has been the battle against monopoly.’

As Europe sank back into self-sufficiency, Arabia was discovering gains from trade. The sudden emergence of an all-conquering prophet in the middle of a desert in the seventh century is rather baffling as the tale is usually told – one of religious inspiration and military leadership. What is missing from the story is the economic reason that Arabs were suddenly in a position to carry all before them. Thanks to a newly perfected technology, the camel, the people of the Arabian Peninsula found themselves well placed to profit from trade between East and West. The camel caravans of Arabia were the source of the wealth that carried Muhammad and his followers to power. The camel had been domesticated several thousand years earlier, but it was in the early centuries AD that it was at last made into a reliable beast of burden. It could carry far more than a donkey could, go to places a wheeled bullock cart could not, and because it could find its own forage en route, its fuel costs were essentially zero – like a sailing ship. For a while even the Byzantine sailing ships of the Red Sea, waiting for the right winds and running the gauntlet of increasingly numerous pirates, found themselves at a competitive disadvantage compared with ‘ships of the desert’.

Although a small percentage of the European population in the Middle Ages would have even encountered silk and sugar, let alone regularly, and a tiny proportion of Europe’s GDP came from such trade, none the less it is undeniable that Europe’s reawakening was boosted by contact with the productivity of China, India, Arabia and Byzantium through Italian trade. Regions that participated in Asian trade grew richer than the regions that did not: by 1500 Italy’s GDP per capita was 60 per cent higher than the European average. But historians often put too much emphasis on exotic trade with the Orient. As late as 1600, European trade with Asia, dominated because of transport costs of luxuries such as spices, was only half the value of the inter-regional European trade in cattle alone. Europe could trade with Asia because it traded so much with itself, not vice versa.

Empires, indeed governments generally, tend to be good things at first and bad things the longer they last. First they improve society’s ability to flourish by providing central services and removing impediments to trade and specialisation; thus, even Genghis Khan’s Pax Mongolica lubricated Asia’s overland trade by exterminating brigands along the Silk Road, thus lowering the cost of oriental goods in European parlours. But then, as Peter Turchin argues following the lead of the medieval geographer Ibn Khaldun, governments gradually employ more and more ambitious elites who capture a greater and greater share of the society’s income by interfering more and more in people’s lives as they give themselves more and more rules to enforce, until they kill the goose that lays the golden eggs. There is a lesson for today.

Economists are quick to speak of ‘market failure’, and rightly so, but a greater threat comes from ‘government failure’. Because it is a monopoly, government brings inefficiency and stagnation to most things it runs; government agencies pursue the inflation of their budgets rather than the service of their customers; pressure groups form an unholy alliance with agencies to extract more money from taxpayers for their members. Yet despite all this, most clever people still call for government to run more things and assume that if it did so, it would somehow be more perfect, more selfless, next time.

The message from history is so blatantly obvious – that free trade causes mutual prosperity while protectionism causes poverty – that it seems incredible that anybody ever thinks otherwise. There is not a single example of a country opening its borders to trade and ending up poorer (coerced trade in slaves or drugs may be a different matter). Free trade works for countries even if they do it and their neighbours do not. Imagine a situation in which your street is prepared to accept produce from other streets but they are only allowed what they produce: who loses? Yet in the aftermath of the First World War, one by one countries tried beggaring their neighbours in the twentieth century. As currencies devalued and unemployment rose in the 1930s, government after government sought self-sufficiency and import substitution: Greece under Ioannis Metaxas, Spain under Francisco Franco, America under Smoot-Hawley. Global trade fell by two-thirds between 1929 and 1934.

Yes, of course, trade is disruptive. Cheap imports can destroy jobs at home – though in doing so they always create far more both at home and abroad, by freeing up consumers’ cash to buy other goods and services. If Europeans find their shoes made cheaply in Vietnam, then they have more to spend on getting their hair done and there are more nice jobs for Europeans in hair salons and fewer dull ones in shoe factories. Sure, manufacturers will and do seek out countries that tolerate lower wages and lower standards – though, prodded by Western activists, in practice their main effect is then to raise the wages and standards in such places, where they most need raising. It is less of a race to the bottom, more of a race to raise the bottom. Nike’s sweatshops in Vietnam, for example, pay wages three times as high as local state owned factories and have far better facilities. That drives up wages and standards. During the period of most rapid expansion of trade and out-sourcing, child labour has halved since 1980: if that is driving down standards, let there be more of it.

All across Asia, Latin America and Africa, a tide of subsistence farmers is leaving the land to move to cities and find paid work. To many Westerners, suffused with nostalgie de la boue (nostalgia for mud), this is a regrettable trend. Many charities and aid agencies see their job as helping to prevent subsistence farmers having to move to the city by making life in the countryside more sustainable. ‘Many of my contemporaries in the developed world,’ writes Stewart Brand, ‘regard subsistence farming as soulful and organic, but it is a poverty trap and an environmental disaster.’ Surely a Nairobi slum or a São Paolo favela is a worse place to be than a tranquil rural village? Not for the people who move there. Given the chance they eloquently express their preference for the relative freedom and opportunity of the city, however poor the living conditions. ‘I am better off in all facets of life compared to my peers left behind in the village,’ says Deroi Kwesi Andrew, a teacher earning $4 a day in Accra. Rural self-sufficiency is a romantic mirage. Urban opportunity is what people want.

Fossil fuels cannot explain the start of the industrial revolution. But they do explain why it did not end. Once fossil fuels joined in, economic growth truly took off, and became almost infinitely capable of bursting through the Malthusian ceiling and raising living standards. Only then did growth become, in a word, sustainable. This leads to a shocking irony. I am about to argue that economic growth only became sustainable when it began to rely on non-renewable, non-green, non-clean power. Every economic boom in history, from Uruk onwards, had ended in bust because renewable sources of energy ran out: timber, crop land, pasture, labour, water, peat. All self-replenishing, but far too slowly, and easily exhausted by a swelling populace. Coal not only did not run out, no matter how much was used: it actually became cheaper and more abundant as time went by, in marked contrast to charcoal, which always grew more expensive once its use expanded beyond a certain point, for the simple reason that people had to go further in search of timber.

Suppose you had said to my hypothetical family of 1800, eating their gristly stew in front of a log fire, that in two centuries their descendants would need to fetch no logs or water, and carry out no sewage, because water, gas and a magic form of invisible power called electricity would come into their home through pipes and wires. They would jump at the chance to have such a home, but they would warily ask how they could possibly afford it. Suppose that you then told them that to earn such a home, they need only ensure that father and mother both have to go to work for eight hours in an office, travelling roughly forty minutes each way in a horseless carriage, and that the children need not work at all, but should go to school to be sure of getting such jobs when they started work at twenty. They would be more than dumbfounded; they would be delirious with excitement. Where, they would cry, is the catch?

Today, the average person on the planet consumes power at the rate of about 2,500 watts, or to put it a different way, uses 600 calories per second. About 85 per cent of that comes from burning coal, oil and gas, the rest from nuclear and hydro (wind, solar and biomass are mere asterisks on the chart, as is the food you eat). Since a reasonably fit person on an exercise bicycle can generate about fifty watts, this means that it would take 150 slaves, working eight-hour shifts each, to peddle you to your current lifestyle. (Americans would need 660 slaves, French 360 and Nigerians 16.) Next time you lament human dependence on fossil fuels, pause to imagine that for every family of four you see in the street, there should be 600 unpaid slaves back home, living in abject poverty: if they had any better lifestyle they would need their own slaves. That is close to a trillion people.

The wonderful thing about knowledge is that it is genuinely limitless. There is not even a theoretical possibility of exhausting the supply of ideas, discoveries and inventions. This is the biggest cause of all for my optimism. It is a beautiful feature of information systems that they are far vaster than physical systems: the combinatorial vastness of the universe of possible ideas dwarfs the puny universe of physical things. As Paul Romer puts it, the number of different software programs that can be put on one-gigabyte hard disks is twenty-seven million times greater than the number of atoms in the universe. Or if you were to combine any four of the 100 chemical elements into different alloys and compounds in different proportions ranging from one to ten, you would have 330 billion possible chemical compounds and alloys to test, or enough to keep a team of researchers busy testing a thousand a day for a million years.

Let me make a square concession at the start: the pessimists are right when they say that, if the world continues as it is, it will end in disaster for all humanity. If all transport depends on oil, and oil runs out, then transport will cease. If agriculture continues to depend on irrigation and aquifers are depleted, then starvation will ensue. But notice the conditional: if. The world will not continue as it is. That is the whole point of human progress, the whole message of cultural evolution, the whole import of dynamic change – the whole thrust of this book. The real danger comes from slowing down change. It is my proposition that the human race has become a collective problem-solving machine and it solves problems by changing its ways. It does so through invention driven often by the market: scarcity drives up price; that encourages the development of alternatives and of efficiencies.

Today, the drumbeat has become a cacophony. The generation that has experienced more peace, freedom, leisure time, education, medicine, travel, movies, mobile phones and massages than any generation in history is lapping up gloom at every opportunity. In an airport bookshop recently, I paused at the Current Affairs section and looked down the shelves. There were books by Noam Chomsky, Barbara Ehrenreich, Al Franken, Al Gore, John Gray, Naomi Klein, George Monbiot and Michael Moore, which all argued to a greater or lesser degree that (a) the world is a terrible place; (b) it’s getting worse; (c) it’s mostly the fault of commerce; and (d) a turning point has been reached. I did not see a single optimistic book.

Even the good news is presented as bad news. Reactionaries and radicals agree that ‘excessive choice’ is an acute and present danger – that it is corrupting, corroding and confusing to encounter ten thousand products in the supermarket, each reminding you of your limited budget and of the impossibility of ever satisfying your demands. Consumers are ‘overwhelmed with relatively trivial choices’ says a professor of psychology. This notion dates from Herbert Marcuse, who turned Marx’s notion of the ‘immiseration of the proletariat’ by steadily declining living standards on its head and argued that capitalism forced excessive consumption on the working class instead. It resonates well in the academic seminar, causing heads to nod in agreement, but it is sheer garbage in the real world. When I go into the local superstore, I never see people driven to misery by the impossibility of choice. I see people choosing.

The search for a widespread epidemic of cancer caused by synthetic chemicals, relentlessly and enthusiastically pursued by many scientists ever since the 1960s, has been entirely in vain. By the 1980s, a study by the epidemiologists Richard Doll and Richard Peto had concluded that age-adjusted cancer rates were falling, that cancer is caused chiefly by cigarette smoke, infection, hormonal imbalance and unbalanced diet – and that chemical pollution causes less than 2 per cent of all cases of cancer. The premise on which much of the environmental movement had grown up – that cleaning up pollution would prevent cancer – proved false. As Bruce Ames famously demonstrated in the late 1990s, cabbage has forty-nine natural pesticides in it, more than half of which are carcinogens. In drinking a single cup of coffee you encounter far more carcinogenic chemicals than in a year’s exposure to pesticide residues in food. This does not mean that coffee is dangerous, or contaminated: the carcinogens are nearly all natural chemicals found in the coffee plant and the dose is too low to cause disease, as it is in the pesticide residue. Ames says, ‘We’ve put a hundred nails in the coffin of the cancer story and it keeps coming back out.’

The amount of oil left, the food-growing capacity of the world’s farmland, even the regenerative capacity of the biosphere – these are not fixed numbers; they are dynamic variables produced by a constant negotiation between human ingenuity and natural constraints. Embracing dynamism means opening your mind to the possibility of posterity making a better world rather than preventing a worse one. We now know, as we did not in the 1960s, that more than six billion people can live upon the planet in improving health, food security and life expectancy and that this is compatible with cleaner air, increasing forest cover and some booming populations of elephants. The resources and technologies of 1960 could not have supported six billion – but the technologies changed and so the resources changed.

The four horsemen of the human apocalypse, which cause the most premature and avoidable death in poor countries, are and will be for many years the same: hunger, dirty water, indoor smoke and malaria, which kill respectively about seven, three, three and two people per minute. If you want to do your fellow human beings good, spend your effort on combating those so that people can prosper, ready to meet climate challenges as they arrive. Economists estimate that a dollar spent on mitigating climate change brings ninety cents of benefits compared with $20 benefits per dollar spent on healthcare and $16 per dollar spent on hunger. Keeping climate at 1990 levels, assuming it could be done, would leave more than 90 per cent of human mortality causes untouched.