James Verdier
Hi, I'm James Verdier, and welcome to the American Institute of Biological Sciences bioscience talks, which is a forum for integrating the life sciences. For today's episode, I had the great fortune to be joined by Dr. Charlie Hall Professor Emeritus at SUNY College of Environmental Science and Forestry. He was here to talk about his recent book review and bioscience of Peter Victor's new biography of Herman Daly, who recently died at the age of 84. But whose ideas are still very relevant today. And in addition to chatting about the book, we also talked about quite a few other topics relating to the intersection of biology and economics and energy, of course, and kind of how those concepts are interrelated, interdependent, and have some very important implications for both biologists and humanity more generally, I'll leave all that to Dr. Hall to explain, and also drop a few important links in the show notes that I urge you to check out. But with no further ado, let's go straight to the interview. Dr. Hall, thank you very much for joining us today.

Charlie Hall
Happy to be here.

James Verdier
Okay. So I guess one of the first questions we might begin with is this book review, you've written about a biography of Herman Daly is referring primarily to economics. And I note from your CV and your history that you're an ecologist? And so I guess one of the first things we might ask is what's going on here at this intersection of ecology and economics? And you know, what can you kind of tell us about that?

Charlie Hall
Okay, well, yes, I am an ecologist, I call myself a systems ecologist, I was trained by Howard Odum, who is, in his imperfect way, the most intelligent person I've ever met, and fantastic PhD advisor. And he wrote environment power in society. In my last year that I was with him, so he introduced me to the concept of thinking about social systems as ecosystems. And in that book, environment, current society, then there in the first chapters is a series of little pictures that show how a city is like an oyster reef and so forth. And if you take a systems in an energy perspective, then you're dealing with the same thing. I would, I've worked in some 30 different countries, and I was often asked after I've just been someplace dealing with a new problem. After just a day or two, somebody would say, My God, you are, you are just been here looking at our situation. Whatever it is, fisheries, agriculture, whatever, just for a day or two in already, you are telling me important things about my own situation that never occurred to me and studying it for decades. You know, how he said, and I, I said, well it's, it's not a new ecosystem, to me that if you have the systems perspective, there is enormous similarity to all ecosystems, if you think about it, not in terms of all the species necessarily, although that it's important, but thinking about where the energy comes from, how it's captured, where it goes, what it's used for, how people manipulate it, and so forth. Um, including human settlements and cities and so forth. I use the same basic diagrams for a city that I would use for an estuary or for grassland newts is a lot of basic similarities to any ecologist in. And I would also like to add, that I perceive myself as a natural scientist, in most of economics is done by people who call themselves social scientists. And so a lot of my early work in economics, which is influenced by Herman Daly, was about looking at human ecosystems using the natural sciences, not the social sciences. And I think you can get a tremendous amount of insight by using the natural sciences and the scientific method, which, incidentally, economists don't necessarily use. And they certainly do not seem to be beholden to the laws of thermodynamics or the importance of energy or including whole systems analysis, such as where does their stuff come from? And so it's, there's a great deal that you can gain by looking at city or country and as an ecosystem, analyzing accordingly.

James Verdier
That makes sense. And I think it leads nicely into the way actually that you opened the book review, which was with a sort of cautionary note for biologists who are increasingly being asked to make economic analysis. And that could be something like analyzing the value of an ecosystem service, for instance, say a fishery, or the value of carbon sequestration within a different sort of ecosystem. And you kind of describe that there are some fundamental incompatibilities between the way that economics is practiced in the contemporary time, and the way that biologists typically conduct their practice. So there are some fundamental incompatibilities, some shortcomings, perhaps in terms of the amount of rigor that's practiced by economist at certain tasks. So Toby, you just sort of expand on that a little bit and give us an idea of what's going on and what biologists have to kind of worry about,

Charlie Hall
I first put this in a paper that was in bioscience in 2001. And it's referenced in my daily review, where he just said, and I'm not the first to say this, amongst the best people that had say this, what was Vasily Bianca, who was a Nobel Prize winner in economics himself? And he said, How long will people in and he gave a whole list of real sciences keep from criticizing economics, which is a whole house of cards. It's not based on real science in it. In fact, it breaks the laws of thermodynamics, it uses improper boundaries, and it doesn't use the scientific method. These three points are made very clearly and with examples in the 2001, paper and BioScience, which is referenced. So I'm not the only one who does this. I also quote a colleague of mine, John Erickson, who says, well, this is a book with the title protect us from the fairy tales of economics, and it's something like that uses fairy tales, and He's an economist, he's a really gone and he's less polite in that respect and Herman day, but Herman daddy thought that as well, so, but the economist, it's not that they don't answer our question. They don't even pay any attention to it. And even though there might be 100 people that have asked this question of economics, and I can give a whole list of a time that a both economists in natural sciences the economists don't care. They circle their wagons and, and talk about Pareto efficiencies and stuff like that, and pay no attention in I would like to add, that's only neoclassical economists, because until 1880 or so, economists are what was called moral philosophy back then. The physiocrats, and even the classical economists were much, much closer in their way of thinking, to my perspective now, although they didn't know so much about the importance of fossil fuels. So that it's only this particular brand of economics that's somehow hoodwinked the world into making it look like they know what they're talking about, which I don't think they do. Of course, they're good at certain things. And I don't complain about people who do good accounting that kind of thing. But if you go and open up chapter one of any economics textbook, they'll put in this diagram of firms and households, as if an entire economy was only made a firm's business firms and households, producers, direct producers and consumers, even though nature is the ultimate producer. And they don't think about raw materials. They don't think about energy except as a commodity. And they think energy is unimportant because it's only five or 10% of GDP, but it's because you get so much punch, as I mentioned in the article, for so little money, that energy is so important to our economy to wealth, the rounded that you see around us. Our houses or food are all based on cheap, cheap energy, especially cheap one.

James Verdier
Okay, so your criticism is essentially that they're leaving out the element of energy in their models. And in so doing, essentially leaving out the element of the very constrained resources of the natural world.

Charlie Hall
Well, I made it make something called production functions. Not only that they only have labor and capital, oh, so if you ask a physicist or a real scientist how do you make something? How do you make some economic product and they scratch your head a minute, he said, well you take some stuff from nature, and you apply energy to it to turn it into ever more refined form closer and closer to what you want. And then sooner or later, you get something that you want. And that's how things are made.

James Verdier
Right. And was it was it was a Daly's observation that that the energy element was something that they tended to disregard? Because as you said, of its cheapness.

Charlie Hall
The price was cheap. But looking at it this way, well, I said this in the article, you could, you can buy a barrel of oil now for 70 bucks or something like that. And I think I said 100 in the review, but then it, it does the physical work of a strong person over two years, which would cost you $80,000. So I mean, think of digging the grave, do it yourself with a shovel, and then you know, get a dollar's worth of diesel on a device to use it. And you can take the grain for a relatively few dollars. And talk about agriculture and tractors, on and on. And on it. It's a, it's a whole ecosystem of production of turning raw materials, into goods and services. So in a back in that 2001 Bioscience article, we have a diagram of how economists think the world works firms and households, and we have a more complex one starting with nature, about how economies really work. Well, that should be taught to every youngster taking his first course in economics. And in fact, the first I think, very strongly that the first course in economics should use our textbook, Kent Klitgaard energy in the Wealth of Nations in Introduction to biophysical sciences there are other good books around, but they're being told fairy tales from square one, it's as if you were doing biology without mentioning thermodynamics, can you do that? Oh, no. In order, can you can you do biology without talking about the, the larger milieu in which life must exist? You can't do it, you can't do it for economies either.

James Verdier
And so what, what Daly would say, and what you've also said many times throughout your career is that we're in a period of a relative glut of cheap energy, where we have this resource that we can exploit very easily or had. And it allowed us to kind of create this exceptional period of growth. And it's not going to last and it's we're going to be constrained by these ultimate sort of planetary level constraints or holds on our ability to continue to grow at that level?

Charlie Hall
Well, of course, but I mean, I published a paper recently that talks about how much oil we have left, which is basically half of what everybody else is saying. And not only that it's getting the quality is declining, day by day. And but you know, this is just the tip of the tip of the iceberg of what the depletion of our best grade fossil fuels will mean, and is meaning now, and if lots and lots of examples, I personally, highly recommend reading this book by Nafeez Ahmed, it's essentially biophysical triggers of economic collapse. And I think he does a wonderful job of showing country by country Egypt, Syrian and Nigeria and so forth as countries go through their cycle of oil availability, well producing countries. As the oil becomes available, things become cheap, and government subsidized gasoline. And people get rich in often they have more children, not always but often they have more children. Everything looks good. And then they hit what's called Hubbard's peak, the oil production to maximum production per year. And then it inevitably starts going down. And as appears to be occurring for the world as a whole, we had a peak in, in 2018. And so everybody has expectations, and every generations thinks they're gonna be richer than the generation before. But hey, that doesn't work anymore. And all of a sudden, you got a lot more people to feed. And people in Egypt, farmers in Egypt can't even afford the diesel to pump the Nile up onto their croplands. And then you get in political turmoil, and we can see it in country after country that people are rioting. Peru is in the news today. People are rioting. It's fundamentally because the cheap energy is run out and people expect that as an economic things that their own was, we had a period of cheap energy when we're reaching the end of that country by country, and people will like it. Even France they were all the yellow jackets and so forth that were out there. I can go on country by country. Now. They have other good reasons, perhaps to riot as well. But I think the ultimate impact in this is in Ahmed's analysis, is the country's become harder and harder to govern. And we've got that to look forward to. It's not very nice. So we have a hard enough time predicting how much well it will be. But we have an even harder time and predicting the social response to that.

James Verdier
So we're in a little bit of a sticky wicket, we've got a growth based model,

Charlie Hall
Not a little sticky wicket but an enormous sticky wicket.

James Verdier
Yeah. So I mean, we're constantly pursuing material growth, yet, we're hitting the limits of you know, the resources and the amount of energy that we have to expend to get those resources.

Charlie Hall
And I want to make sure I say this, we're wrong about fracking. Fracking bought us a decade, maybe a decade and a half. But that that's ending now too. And so there are people say, Oh, technology will come to the rescue, and it did with fracking, sort of only for the United States, though. And now we're reaching the end of that net was highly subsidized. I wrote an article, a little review for the hill magazine that talked about how Trump looked good, because the price of energy was low in the United States while he was president. And it looked like the economy was going very well, which of course, would be the case, because the price of energy was low. Why was it low? It was because all kinds of people were subsidizing the fracked oil in losing money in the process. Fracked oil until recently, was a complete money losers. I wrote a review saying that Trump has a bunch of losers to blame for his success in economics, in the price of oil was half the price during the Trump administration than it was during the Obama administration, and less than that, than it is now. And half the price of what it was in Europe. So of course, the United States economy was doing well, it had a lot of cheap oil. That's a way to make your economy work very well. And, yes, free is there. And I've written books on it. And it's all there in The Economist have no, effing clue.

James Verdier
Right. And let me try to set up a parallel here. And let's see if you buy it. You know, I'm kind of reminded of Paul Ehrlich's Population Bomb, where the Green Revolution bought some amount of respite, some number of years of respite from the population concerns, is fracking similar and on the energy side of buying us a little bit of time, but not addressing the fundamental problem that we've got this ecological overshoot where we're asking too much of the world basically,

Charlie Hall
You know, I'm embarrassed and I never thought of that. That's a really good parallel, James, I would say it's exactly parallel. Well, Eric is one of my heroes going way back and still today, and they're both a perfect storm. I think the price of oil is likely to go up a whole unless we have a recession or a depression if that's the case, some price of everything will come down. But there'll be all kinds of other problems. If we do not have a significant recession, I just don't see any way that we can bump around at 75 to $100 a barrel. But the guilt, Herbert says is a critical price of oil, you gotta it's gotta be expensive enough, so people will go get it, which is made me dollars a barrel, the not so expensive that it runs our economy, which might be $100, a barrel or something like that. So I guess at the moment, it's 75 or so dollars a barrel. So that's pretty good for them. So we'll have the stuff won't hit the fan for a little bit longer. And I can't tell you exactly when. But I would guess within the next five or 10 years, we're gonna see really serious declines, because still, more than half of our oil comes out of just a couple of 100 big fields that all were discovered more than 50 years ago, we're just putting the old oil fields dry. That's where more than half of our oil in the world comes from, from fields that are more than 50 years old. And they're big fields, giant fields, and they're cheap, meaning energy cheap, as well as darn cheap. Energy cheap ends, fields, well, we're just pumping to dry. And they're declining at 6% a year. And we're trying to make up for the rest of it with fracking. And now we frack all the way calls the sweet spots, and we've gone after the poor and poor quality things. And there have been some impressive technological gains. But I think I think we better get used to the idea that the price of oil is going to go up quite a lot in the way people will see it will be inflation. And when we see inflation, what they do they blame your politicians.

James Verdier
And that's not currently baked into the way that neoclassical economists think about the world. Gotcha. So I'm wondering, now what would you know, Herman Daly, or you of course have to say about the way that we should conduct ourselves with this knowledge that we are kind of walking a current monetary tightrope in terms of the price of oil, and it's going in a direction we don't like we're obviously in a precarious situation. How should we be thinking about the way that we conduct our society is different?

Charlie Hall
Well, under the guidance of Howard Odum, I figured this out 60 years ago and didn't have children for that reason, fair. So that's, it's not just that we need to have your children we have to adjust to a society that is much less energy dependent. And I'm worried about all the Gung Ho-ness about so called green energy, which not green at all, takes a huge amount of fossil fuel to make this stuff. But anyway, the green society if even if we were able to pull it off, then that just allows, in many people's mind, growth to continue. And that's not going to solve the you know, every, every politician runs on more. And show me a politician that runs on less. And we gotta get that going. So I'm not too I'm not too hopeful one that. And I think that we are even less successful at getting our message to the populace. I mean, then we were 20 years ago, who thinks about peak oil and peak oil says happened to the world folks. And it's an open for something like 38, or 46, oil producing countries. And we have it all documented, and that's part of what I've done and proud of the work that other people are trying to allocate. So that's a really good, really good day. When I just spilled off at the mouth here, we get tons and tons of data as to people like our purple, and Nate Hagen, so forth. I mean, it's just bloody obvious. If you get out of your cocoon and you take your scientific approach in the scientific method, in the laws of thermodynamics, and apply it to the rest of, of human existence and that, in fact, I think, a big topic on that in in bioscience and because bioscience have been how scientists have been so complicit in not requiring the scientific method be used by those they interact. And too much of too much of biological policy is not it says it's science based, but it's not quite doesn't meet my standards. So I think, for example, that the end of cheapo elder depletion of our best, while and gas resources will be have a much greater impact on human society that will even climate change.

James Verdier
So I'm wondering, then we have this situation, which are various approaches, whether they be in ecology, or whether they be in economics or not, including these important elements, what would a society what would a practice of ecology, economics look like that that manage that in a better way? Well,

Charlie Hall
The very first thing is, is a systems approach. And what does the system's approach mean? I can't, it means that you think about all the influences on whatever it is that you're dealing with, where they come from you, I find the best way is to make a complete energy flow diagram or whatever the issue is that I'm dealing with. And start there in in to talk to people in other disciplines is a good idea to whether they think about it and see if you can agree on some kind of approach together. We we've done this in, in lysing, the economies of you know, Argentina, in Costa Rica, Bolivia in the past, we've done these kinds of things. And one of the first thing is, is you don't tell economists sit there welcome at the table, but they cannot be dominant not. And certainly economists, and many of them are smart and have good insights, I hope. But the fundamental thing. Just go back and read that paper in biosciences, it makes sure that what you're doing stands the test that we learned as juniors in college about what is true and what is not true. And the only way I know to seek truth is the scientific method. It's not perfect. But let's apply the scientific method to what we do. And you know it sometimes he can do this, by the way, but they haven't done it for the most fundamental perspectives of how neoclassical economics works. And they don't have enough knowledge of history. I wrote my energy in the Wealth of Nations book An Introduction to biophysical economics. I wrote that with an economic historian Kent Klitgaard. And he understands that economics is far more than what is taught to sophomores today. It's a rich complex field with many, many deep questions. And many of the earlier economists were interested in where does Where does economic wealth come from? Where does Where does wealth come from? Let me just give you an idea of Congress. Uh, well money is a real money has to be backed by say, gold. But when the Spaniards brought gold from the old world, from the New World, back to the old world, they doubled its amount and half its value. Because the real wealth came from the operation of the forests in the fields in the grind the farmers and the fisherman and so forth. The energy applied into extracting wealth from nation from nature. And even Adam Smith understood that people think he wrote only the Wealth of Nations, but he wrote another book on economics. What call closer to what we're talking about here. And he is hardly going, Oh, capitalists that he's brought out to they just quote, a convenient part of Adam Smith and marginal utility, he gets all the credit for that. But he wrote a book called The Coal Question in the 1850s that is right on the money with respect to all of this. So even some, it'll carnival understood, diminishing margin, your marginal utility understood how farmland got poorer and poor, as you use more of it in oil fields get poorer and poorer as we drill more of them. So those guys that classical guys were often right on the money and go back to today. Who said that? In the physiocrats, who said what all wealth comes from the land? As was the case back then when photosynthesis was the source of all wealth? And it well, let me take that a little further. And the classical guys like Adam Smith, and Ricardo and Mark Sibley, wealth comes from labor, what was the energy of labor? It was the end for the energy of photosynthesis. That was the basis of wealth and even in the 1950s level, basic wealth is capital. But that's it isn't capital loan. Capital is the means of using fossil energy. And so always there, the good economists are talking about where does wealth really come from? And they got it right. It comes from energy, but they weren't looking at it as energy. They were looking at it as land, labor, capital equipment. I see I think we have an enormous amount, not just me, but people who think like me, to the training of young people in economics, and as they said, Yet, they say, nature is living within the economies. That's the economy that's to live within danger. They cannot possibly altering without living within nature, but they have no coops. That's Herman Daly's -- maybe one of his main points.

James Verdier
No, I think that's an excellent note. And I think that's probably where we'll leave the conversation. But I did just want to ask you one other question about criticism of Herman Daly for not being perhaps as enthusiastic a believer in evolution, as you know, one might wish. Now just I'm wondering what you make of that, because these types of things come up, oftentimes, when we're speaking about those who have pioneered fields in earlier times, when perhaps there may not have been quite the scrutiny, then now we look at it in retrospect and think differently, what do you make of it?

Charlie Hall
Well, let me tell you my inbox for the last three days is mental overwhelmed with this question. And I'm taking a lot of crap from some of my friends, even my economist, friends, for defending her. First of all, Herman was one of the finest human beings the planet has ever seen. Wonderful, wonderful person. And while he, while he had criticisms biofilter, I'd call them while there's a word, biophysical economics, I don't think he used the word is about economics, he had a lot more well as many criticisms of the means and ends of economics. And so values were important to him, and he thought it was a really degradation of values to same monetary values are the values that we should use. They're all kinds of other values, social values and humanistic values. And he would say he did say often spiritual values. And Herman was one of my former students covered Cleveland told me back in, I guess, 1984, so he was down at LSU. Taking the classroom, Herman he loved his teacher, because not most people did. He said the fundamental term, and he said, he's, he's very religious. And I think this reflects maybe his background and conservative Texas or maybe not. What I argue just two days ago, and I'll send it to you, that purlins contributions are independent of what do you might feel about the existence of God, our world is formed, even evolution? And I'm not sure that I agree that Herman's use very inconsistent with an evolutionary perspective, I don't know. And unfortunately, he's no longer here to ask him. But I say let sleeping dogs lie. I don't. Herman had so much. To add to economics, he basically did not talk about religion or spiritual values, in his criticisms, in his suggestions for economics, he would sometimes say that we should have different values than just valuing things in terms of money, but in he would include spiritual and let the reader decide what he meant by that. So I'm in the middle of that right now. And taking some flack and but I've defended in my emails into some pretty potent economists. I've defended her Herman. I mean, I'm an atheist, I I'm not an I'm all or nearly so either. He or certainly marvelous. You might guess I'm in nature worshiper. But I'm back at Colgate I was trained very much that there are questions that science can answer and questions that science can audience, including many related to values. And I I'm uncomfortable with some of my colleagues, criticizing Herman's economics, because he didn't believe as much as they did. In evolution. I never heard Herman say or I don't remember reading anything besides timber? I think he did think there was some god somewhere behind all this in I don't know that there isn't. You know, that's, I don't have the ability to answer that question. But I don't think so. laminators.

James Verdier
Yeah, I think that's I mean, I think that that's a a very interesting perspective and kind of speaks to the value of continuing conversation. But I wanted to thank you, Dr. Hall for what's been a fantastic conversation. I've learned a lot. And I really appreciate your time. Thank you.

Charlie Hall
Thank you.

James Verdier
And that concludes this episode of Bioscience Talks. Just a reminder at the journal Bioscience is published by Oxford University Press on behalf of the American Institute of Biological Sciences, and it's made possible by the support of our members and donors. Thank you and talk to you next time.