A-5 Brown, Lester R.: Nature's Limit (Chapter 1) from the State of the World 1995, Worldwatch Institute, Washington, D.C.

In September 1994, the 179 national delegations assembled in Cairo at the International Conference on Population and Development reached agreement on a plan designed to stabilize world population. The World Population Plan of Action may be the boldest initiative ever undertaken by the United Nations, dwarfing some of its earlier achievements, such as the eradication of smallpox. On the twenty-fifth anniversary of the 1969 moon landing, we can paraphrase American astronaut Neil Armstrong: Cairo was a giant step for humankind.

In the preparatory meetings leading up to the conference, delegates had rejected the notion that population growth would continue on the high trajectory, reaching 11.9 billion by 2050. Instead, they opted for an extraordinarily ambitious plan to stabilize population between the medium projection of 9.8 billion by 2050 and the low projection, where population would peak at 7.9 billion by 2050. Their strategy reflects a sense of urgency - a feeling that unless population growth can be slowed quickly, it will push human demands beyond the carrying capacity of the land in many countries, leading to environmental degradation, economic decline, and social disintegration.

Among other things, the plan calls for quickly filling the family planning gap - for providing services to the estimated 120 million women in the world who want to limit the number of their children but lack access to the family planning services needed to do so. But more important, it addresses the underlying causes of high fertility, such as female illiteracy. It calls for universal primary school education for girls, recognizing that as female educational levels rise, fertility levels fall - a relationship that holds across all cultures.

Twenty years earlier, the first U.N. population conference, in Bucharest, had agreed that access to family planning services was a human right. In Cairo, the focus was on gender equity. Kaval Gulhati, a veteran family planning leader from India, may have put it best: "Unless women can manage and control their own fertility, they cannot manage and control their own lives."

The goals set in Cairo will be extraordinarily difficult to achieve, but if the world succeeds in stabilizing human numbers at 8 or 9 billion, it will satisfy one of the conditions of an environmentally sustainable society. The plan recognizes both the earth's natural limits and the need to respect those limits.

In the mid-nineties, evidence that the world is on an economic path that is environmentally unsustainable can be seen in shrinking fish catches, falling water tables, declining bird populations, record heat waves, and dwindling grain stocks, to name just a few.

The world fish catch, which climbed more than fourfold during 40 years, is no longer rising, apparently because oceanic fisheries cannot sustain a greater catch. The failure to coordinate population policy with earlier carrying capacity assessments of fisheries means the world now faces a declining seafood supply per person and rising seafood prices for decades to come.

Concern over water scarcity is rising in many areas. A prolonged drought in northern China, for example, and the associated water shortages have raised questions about the suitability of Beijing as the national capital and renewed discussion of a 1,400-kilometer (860-mile), canal that would bring water from the south to the water-deficit north. Although the cost of building this enormous conduit - comparable to bringing water from the Mississippi River to Washington, D.C. - was initially estimated at $5 billion, the total could ultimately be several times larger. Among other things, it will challenge engineers because it must cross 219 rivers and streams, including the Huang He (Yellow River), en route to Beijing.

Although collapsing fisheries and water scarcity attract attention because of their immediate economic effects, the decline of bird populations may be a more revealing indicator of the earth's health. Recently compiled data by Bird-Life International of Cambridge, England, show populations dropping on every continent. Of 9,600 species, only 3,000 are holding their own; the other 6,600 are in decline. Of these, the populations of some 1,000 species have dropped to the point where they are threatened with extinction. The precise reasons for this vary, but they include deforestation, particularly in the tropics; drainage of wetlands for farming and residential construction; air and water pollution; acid rain; and, for some species, hunting.

After two decades of steadily rising global average temperature, including the highest on record in 1990, the June 1991 eruption of Mount Pinatubo in the Philippines gave the world a brief respite from global warming. The explosion ejected vast amounts of sulfate aerosols into the upper atmosphere, which quickly spread around the globe. Once there, the aerosols reflected a minute amount of incoming sunlight back into space, enough to exert a cooling effect. By early 1994, however, almost all the aerosols had settled out, clearing the way for a resumption of the warming trend.

Evidence of new temperature highs was not long in coming. A premonsoon heat wave in central India lasted several weeks with temperatures up to 46 degrees Celsius (115 degrees Fahrenheit), taking a heavy toll on humans and livestock in the region. For the western United States, hundreds of new records were set, creating hot dry conditions that led to a near record number of forest fires.

Japan had the hottest summer on record. Intense heat led to excessive evaporation and water shortages so severe that many utilities and manufacturing firms in Tokyo and surrounding areas were forced to import water by tanker from as far away as Alaska. Over a thousand miles to the west, Shanghai - with little air conditioning - suffered during July through 14 days above 35 degrees Celsius (95 degrees Fahrenheit) and 16 days between 33 and 34 degrees Celsius. And in parts of Northern Europe, including Germany, Poland, and the Baltic states, mid-summer temperatures soared well above 32 degrees Celsius, exposing both residents and ecosystems to unaccustomed levels of heat.

On the food front, developments were particularly disturbing. Even though in 1994 the United States returned to production all the grainland that had been idled under commodity supply management programs, global food security declined further as the world's projected carryover grain stocks from the 1994 harvest dropped to the lowest level in 20 years. A combination of spreading water shortages, declining fertilizer use, and cropland losses, particularly in Asia, led to another harvest shortfall and the drawdown in stocks.

Thus in various ways, nature's limits are beginning to impose themselves on the human agenda, initially at the local level, but also at the global level. Some of these, such as the yield of oceanic fisheries or spreading water scarcity, are near-term. Others, such as the limited capacity of the atmosphere to absorb excessive emissions of carbon without disrupting climate, will manifest themselves over the longer term.

THREE IMMINENT LIMITS

One of the key questions that emerged as the world prepared for the Cairo conference was. How many people can the earth support? Closely related was, What exactly will limit the growth in human numbers? Will it be the scarcity of water, life-threatening levels of pollution, food scarcity, or some other limiting condition? After considering all the possible constraints, it appears that it is the supply of food that will determine the earth's population carrying capacity. Three of the earth's natural limits are already slowing the growth in world food production the sustainable yield of oceanic fisheries, the amount of fresh water produced by the hydrological cycle, and the amount of fertilizer that existing crop varieties can effectively use.

Nature's limits are beginning to impose themselves on the human agenda, initially at the local level, but also at the global level.

More than 20 years have passed since a marine biologist at the U.N. Food and Agriculture Organization (FAO) estimated that oceanic fisheries could not sustain an annual yield of more than 100 million tons. In 1989, the world fish catch, including that from inland waters and fish farming, reached exactly that number, an amount equal to world production of beef and poultry combined. (See Chapter 2.) During the following four years, it has fluctuated between 97 million and 99 million tons, dropping the fish catch per person 8 percent in four years. Recent FAO reports indicate that all 17 oceanic fisheries are now being fished at or beyond capacity. With the total catch unlikely to rise much above 100 million tons, the decline in the seafood supply per person of the last few years will continue indefinitely - or at least until the World Population Plan or Action succeeds in stabilizing population.

A combination of pollution and over-harvesting is killing many inland seas and coastal estuaries. The Aral Sea, for instance, once yielded 44,000 tons of fish per year; the wholesale diversion of river water to irrigation has shrunk that body of water, raising its salt content and making the salt in effect a pollutant. All 24 species of fish that were once fished there commercially are believed to be extinct. In the Caspian Sea, the famous sturgeon harvest has been reduced to perhaps 1 percent of the level of 50 years ago through pollution and overfishing.

The Black Sea, which is the dumping point for the Danube, Dniester, and Dnieper Rivers, is the repository for chemical and organic pollutants for half of Europe. Of the nearly 30 species that once supported commercial fisheries there, only 5 remain. During the last decade the total catch has dropped from nearly 700,000 tons to 100,000 tons - a result of pollution, overharvesting, and the accidental introduction of destructive alien species offish.

The U.S. Chesapeake Bay, once one of the world's most productive estuaries, is deteriorating rapidly from a lethal combination of pollution, overharvesting, and - for oysters - disease. Formerly a major source of this delicacy, the bay's annual harvest has dropped from nearly 100,000 tons of edible oysters (roughly 1 million tons in the shell) around the turn of the century to less than 1,000 tons in 1993. (See Figure l-l.)

Figure 1-1. Chesapeake Bay Oyster Catch, 1880-1993

With land-based food stocks, limits on production are being imposed by the amount of fresh water supplied by the hydrological cycle. Today, two thirds of all the water extracted from rivers and underground aquifers is used for irrigation. In parts of the world where all available water is now being used, such as the southwestern United States or large areas of northern China, satisfying future growth in residential and industrial demand will come at the expense of agriculture.

Although there are innumerable opportunities for increasing irrigation efficiency, only limited potential exists to expand freshwater supplies for irrigation. For example, roughly one fifth of U.S. irrigated land is watered by drawing down underground aquifers. A recent study of India found that water tables are now falling in several states, including much of the Punjab (India's breadbasket), Haryana, Uttar Pradesh, Gujurat, and Tamil Nadu - states that together contain some 250 million people. The drop ranges from less than one meter to several meters a year.

In many parts of the world, the diversion of water to nonfarm uses is also reducing water for irrigation. In the western United States, for instance, the future water demands of rapidly growing Las Vegas will almost certainly be satisfied by diverting water from irrigation. Similarly in China, most cities suffer from severe water shortages, and many of them will meet their future needs by taking water away from irrigation.

The physiological limit on the amount of fertilizer that current crop varieties can use is an even broader threat to world food expansion. In countries where fertilizer use is already heavy, applying more nutrients has little or no effect on yield. This helps explain why fertilizer use is no longer increasing in major food-producing regions, such as North America, Western Europe, and East Asia. During the last several decades, scientists were remarkably successful in increasing the responsiveness of wheat, rice, and corn varieties to ever heavier applications of fertilizer, but in recent years their efforts have met with little success.

Worldwide, fertilizer use increased tenfold between 1950 and 1989, when it peaked and then began to decline. During the following four years it fell some 15 percent, with the decline concentrated in the former Soviet Union following the withdrawal of subsidies. In the United States, fertilizer use peaked in the early eighties and has declined roughly one tenth since then. With China, the other leading food producer, the peak seems to be occurring roughly a decade later. Some countries, such as Argentina and Vietnam, can still substantially expand their use of fertilizer, but the major food-producing countries are dose to the limit with existing grain varieties.

For nearly four decades, steadily rising fertilizer use was the engine driving the record growth in world food output. The generation of farmers on the land in 1950 was the first in history to double the production of food. By 1984, they had outstripped population growth enough to raise per capita grain output an unprecedented 40 percent. But when the use of fertilizer began to slow in the late eighties, so did the growth in food output.

The era of substituting fertilizer for land came to a halt in 1990. (See Figure 1-2.) If future food output gains cannot come from using large additional amounts of fertilizer, where will they come from? The graph of fertilizer use and grainland area per person may capture the human dilemma as the twenty-first century approaches more clearly than any other picture could. The world has quietly and with little fanfare entered a new era, one fraught with uncertainty over how to feed the projected massive growth in world population.

Figure 1-2. World Fertilizer Use and Grainland Area Per Person, 1950-94

Unless plant breeders can develop strains of wheat, rice, and corn that are much more responsive to fertilizer, the world may not be able to restore the rapid growth in grain output needed to keep up with population. Either science will have to come up with a new method of rapidly expanding food production, or population levels and dietary patterns will be forced to adjust to much tighter food supplies. With the prospect of no growth in ocean-based food supplies and of much slower growth in land-based food supplies, the world is facing a future far different from the recent past.

THE ECONOMIC EFFECTS

The depletion of natural capital - of forests, rangelands, topsoil, underground aquifers, and fish stocks - and the pollution of air and water have reached the point in many countries where the economic effects are becoming highly visible, including a loss of output, of jobs,

As the global demand for seafood overruns the sustainable yield of fisheries or as pollution destroys their productivity, for instance, fisheries collapse - raising seafood prices, eliminating jobs, and shrinking the economy. The economic wreckage left in the wake of these collapses can be seen around the world: Fishing villages that once lined the Aral Sea are now ghost towns. In Newfoundland, the collapse of the cod and haddock fishery has left 33,000 fishers and fish-processing workers unemployed, crippling the province's economy. And in New England, families who for generations have made their living from the sea are selling their trawlers and searching for other jobs.

Seafood prices are likely to keep rising for as long as population continues to grow.

Even as fisheries are being destroyed, the world demand for seafood is rising. Seafood was once a cheap source of protein, something that people ate because they could not afford meat. In 1960, a kilogram of seafood cost only half as much as a kilogram 01 beet. In recent years, that margin has narrowed and disappeared as seafood prices have risen above beef. During the last decade the world price of seafood, in real terms, has risen nearly 4 percent a year. (See Figure 1-3.)

Figure 1-3. World Price of Seafood, 1983-94

In a few cases, prices have reached astronomical levels. In November 1993, for instance, a 300-kilogram bluefin tuna caught in the North Atlantic was sold for $80,000 to an agent for top-of-the-line sushi restaurants in Tokyo. While this is not, by any means, an average price for bluefin tuna, prices are climbing and will undoubtedly go higher since the breeding population in the Atlantic has dropped from 250,000 to 22,000 as a result of overharvesting. A giant Caspian Sea beluga sturgeon, laden with prized caviar, can sell for almost as much as a bluefin tuna.

When the price of fresh swordfish hit $18 a pound in Washington, D.C., a local supermarket chain started buying frozen swordfish from more distant fisheries at $10 a pound. This merely brought closer the day when swordfish scarcity would be worldwide. Not only has seafood become more costly, but prices are likely to keep rising for as long as population continues to grow, forcing ever larger numbers of people to compete for limited supplies and reducing seafood consumption among the poor.

In some economies, overcutting forests has done even more economic damage than overfishing. The clear-cutting of tropical hardwood forests by lumber companies has almost completely destroyed this valuable resource in some developing countries, devastating their economies. Côte d'Ivoire, for example, enjoyed a phenomenal economic expansion in the sixties and seventies as its rich tropical hardwood forests yielded export earnings of $300 million a year. It became a development model for the rest of Africa, but as in many other countries that did not practice sustainable forestry, clear-cutting decimated its forests; exports dropped to $30 million a year in the early nineties. The loss of this major source of employment and export earnings, coupled with declining prices for other export commodities and other economic setbacks, led to a steady decline of the economy. Within just half a generation - from 1980 to 1994 - income per person fell by half.

Similar forest destruction in other tropical countries, such as Nigeria and the Philippines, also led to industry collapse and to job, income, and export losses. Nigeria was once a major exporter of logs; by 1988, the nation was spending $100 million to bring in forest products. In the Philippines, exports peaked at $217 million per year in the early seventies, disappearing entirely by the early nineties.

As noted earlier, in many farming areas the claims on underground water supplies now exceed aquifer recharge rates. For farmers in northern India, where wheat and rice are double-cropped, the rate at which the water table is falling - more than a meter per year in some areas - may soon force a shift to less intensive cropping practices. Most likely this will mean a replacement of rice with a less water-demanding, lower-yielding staple crop, such as sorghum or millet. Although this may arrest the fall in the water table, it is not a welcome development in a country whose population is expanding by 17 million per year and is projected to reach a billion within the next six years.

In the agricultural regions surrounding Beijing, farmers no longer have access to reservoir water. They must now either drill their own wells and pursue the falling water table downward or switch to less intensive rain-fed farming. With some 300 cities in China reportedly now short of water, and 100 of them seriously short, similar adjustments will undoubtedly be made by farmers in the agricultural belts surrounding countless other Chinese cities.

In the southwestern United States, the need to supply booming cities with water and the depletion of aquifers is eliminating irrigated agriculture in many locations. In arid Arizona, the diversion of irrigation water to the rapidly growing sunbelt cities of Phoenix and Tucson means that large areas of productive farmland have returned to desert. In the Texas panhandle, where the southern reach of the Ogallala aquifer has been largely depleted, farmers have reverted to dryland farming. Although agriculture continues in this region, the drop in intensity, and hence of output, reduces employment in both the agricultural input and service industries and the agricultural processing industries. As a result, some rural communities are being partially depopulated.

In situations where years of over-pumping is depleting aquifers, reductions in irrigation lie ahead. If the rate of groundwater pumping in an area is double the rate of recharge, for example, the aquifer will eventually be depleted. As it nears depletion, the withdrawal rate necessarily will be lowered by half, because it cannot exceed the recharge rate, so the irrigated area will be reduced accordingly.

One of the commodities most affected by aquifer depletion is rice. Its production is now being constrained by the limits of aquifer yields, the scarcity of land suitable for production, and the capacity of available rice varieties to use more fertilizer effectively. In contrast to wheat and corn, which are largely rain-fed, the production of rice depends heavily on irrigation. This makes yield trends easier to analyze simply because the effect of weather fluctuations is much less.

The precariousness of the balance between world rice consumption and production is becoming more evident each year. In the fall of 1993, world rice stocks were at their lowest level in 20 years. When the Japanese government announced that an uncommonly cool, wet summer had reduced its harvest from 9.6 million tons in 1992 to 7.0 million tons, forcing it to consider emergency imports of close to 2 million tons, the price rise was dramatic. With the market already delicately balanced, these additional Japanese claims doubled the rice futures price in the United States, the world's leading exporter, between late August and mid-November.

A shortfall of 2 million tons of rice is minute compared with a world rice harvest of some 350 million tons - scarcely one half of 1 percent. Nonetheless, when stocks are as low as they are today, even a relatively small shift in the world supply/demand balance can have global repercussions. Fortunately for consumers, particularly those in low-income rice-importing countries, the price of rice began to return to more normal levels in the spring of 1994 as the early rice harvest in tropical Asia neared maturity.

Growth in the irrigated area in Asia, where 90 percent of the world's rice is grown and consumed, has slowed to a snail's pace. Most remaining available sites for large-river diversion projects are either too costly to develop or would displace too many people. The potential for expanding irrigation using underground water is limited by aquifer recharge rates; as noted earlier, over-pumping is already lowering water tables in key food-producing regions of Asia.

The other key constraint on rice output, of course, is the capacity of existing varieties to use fertilizer. On much of Asia's riceland, applying more fertilizer has little, if any, effect on yields. In some countries, fertilizer use is declining slightly as farmers fine-tune applications, matching them more precisely with crop needs.

With irrigation growing very slowly and fertilizer use levelling off, the rise in cropland productivity is also slowing. The rise in rice yield per hectare, which halted in Japan a decade ago, is now slowing nearly everywhere, edging up only 2 percent from 1990 to 1994.

As the rise in rice yields has slowed during the nineties, the loss of cropland to nonfarm uses has speeded up during accelerated industrialization, particularly in China - the world's largest rice producer. Other large countries, including India and Indonesia, are also losing cropland to industrialization and residential development. With the decline in harvested rice area of 2 percent since 1990 offsetting a 2-percent rise in rice yield per hectare, the harvest has ranged narrowly between 350 million and 352 million tons. (See Figure 1-4.) A new rice variety under development at the International Rice Research Institute in the Philippines, which promises to boost rice yields by 20-25 percent after being released around the turn of the century, will help offset some of the riceland losses in prospect for the next several decades. With production stalled since 1990, carryover rice stocks have fallen in each of the last four years, dropping to the lowest level per person since 1972, leaving the world vulnerable to sharp price rises. The political leaders of Asia - a region adding 57 million people annually - face no more pressing question than how to restore growth in the rice harvest.

Figure 1-4. World Rice Production, 1950-94

An even more telling indicator of the loss of momentum in expanding grain output is the drawdown in world stocks since 1987. Then, world carryover stocks of grain from the 1985 harvest totalled 465 million tons, an all-time high and equivalent to 104 days of consumption. During the following eight years, grain stocks were reduced to 302 million tons, a drop of 163 million tons or some 20 million tons a year. (See Figure 1-5.) This annual drawdown exceeds the yearly growth in the world grain harvest during this period, which averaged roughly 10 million tons. Stated otherwise, a substantial part of the growth in world grain consumption since 1987 has come from consuming stocks, a trend that cannot continue much longer because current stocks represent only 59 days of consumption - little more than pipeline supplies.

Figure 1-5. World Grain Carryover Stocks, 1961-95

In response to the decline in grain stocks in 1993, the United States released for production in 1994 all grain-land idled under its commodity supply management programs. Even with this land returned to use, and even with fair to excellent growing conditions in the world's major food-producing regions, stocks continue to decline. If grain stocks cannot be rebuilt in years of good harvests, when will they be rebuilt?

In the absence of a dramatic new technological advance in agriculture comparable to the discovery of fertilizer or the hybridization of corn, there is now a real possibility that grain production could continue to lag and that prices could begin to rise in the years ahead, following those of seafood upward. The unfortunate reality is that with carryover stocks at such a low level, the world is now only one poor harvest away from chaos in world grain markets.

The collision between continuously expanding human demands and nature's various limits affects not only the world food supply but also overall economic growth. A 1993 study published by the World Bank notes that environmental damage takes many forms, including land degradation, pollution damage, the loss of biological diversity, deforestation, and soil erosion. Using a dozen or so examples, the two authors - both economists - show that the annual costs to countries of various forms of environmental damage can range from less than 1 percent to as much as 15 percent of gross national product. (See Table 1-1.) If the data were available to calculate all the economic costs of environmental degradation in its many forms, they would undoubtedly show an enormous loss. The authors observe: "If you asked any economist at the World Bank today if the environment is important to the country they work on, they would say 'Yes.' A few years ago, they wouldn't have said that."

Table 1-1. Estimates of Environmental Damage in Selected Countries

Country and Year
Form of Environmental Damage
Annual Costs as a Share of GNP

(percent)

Burkina Faso (1988)
Crop, livestock, and fuelwood losses from land degradation
8.8

Costa Rica (1989)
Deforestation
7.7

Ethiopia (1983)
Effects of deforestation on the supply of fuelwood and crop output
6.0-9.0

Germany (1990)1
Pollution damage (air, water, soil pollution, loss of biodiversity)
1.7-4.2

Hungary (late eighties)
Pollution damage (mostly air pollution)
5.0

Indonesia (1984)
Soil erosion and deforestation
4.0

Madagascar (1988)
Land burning and erosion
5.0-15.0

Malawi (1988)
Lost crop production from soil erosion
1.6-10.9

Costs of deforestation
1.2-4.4

Mali (1988)
On-site soil erosion and losses
0.4

Netherlands (1986)
Some pollution damage
0.5-0.8

Nigeria (1989)
Soil degradation, deforestation, water pollution, other erosion
17.4

Poland (1987)
Pollution damage
4.4-7.7

United States2 (1981)
Air pollution control
0.8-2.1

(1985)
Water pollution control
0.4

1 Federal Republic of Germany before unification.
2 Measures the benefits of environmental policy (avoided rather than actual damages).
SOURCE: "Environmental Damage Robs Countries' Income," World Bank News, March 25, 1993, based on David Pearce and Jeremy Warford, World Without End (Washington. D.C.: World Bank, 1993).

The crossing of sustainable yield thresholds in sectors such as forestry and fishing and in aquifers, combined with the slowdown in the growth in world grain production, directly affects the performance of the world economy. To begin with, these primary producing sectors play a unique role in the global economy. If the growth in production of food from both land- and ocean-based sources falls far behind growth in demand, the resulting rise in prices could destabilize some national economies.

Economic growth, peaking at 5.2 percent a year in the sixties, dropped to 3.4 percent in the seventies and to 2.9 percent in the eighties. Thus far, during the nineties, it has averaged 1.4 percent, which means that the per capita output of food, energy, housing, and the other goods and services that determine living standards has declined by roughly 0.3 percent a year. (See Table 1-2.)

Table 1-2. World Economic Growth by Decade, Total and Per Person

Decade
Annual Growth
Annual Growth Per Person

(percent)

1950-60
4.9
3.1

1960-70
5.2
3.2

1970-80
3.4
1.6

1980-90
2.9
1.1

1990-94 (prel.)
1.4
-0.3

SOURCE: Worldwatch Institute based on sources documented in endnote 40.
Several trends are contributing to slower economic growth, such as a near saturation of markets in some advanced industrial societies for basic consumer goods - automobiles and household appliances, for example - In some developing countries, burdensome external debt has slowed growth, and in Eastern Europe economic reforms have taken a toll. But also included among the reasons for slower world economic growth is the lack of growth in the fishing and farming sectors. Indeed, the 1994 fish catch was an estimated 3 percent smaller than in 1990, while the grain harvest was down nearly 2 percent. In addition, the economic uncertainty and, in some cases, instability associated with colliding with limits undermines confidence in the future. The bottom line is slower economic growth.

Although projections by the International Monetary Fund show economic growth accelerating in the years immediately ahead, these could be derailed by the instability associated with food scarcity. The nineties could turn out to be the first decade since the Great Depression when income per person for the world as a whole actually declines. Incomes fell in some 53 countries containing more than 800 million people during the eighties, many of them in Africa. But that incomes might fall for the entire world during the nineties has not been anticipated in any long-range economic projection.

UNSUSTAINABILITY FEEDS INSTABILITY

Once the demand for a particular product, such as seafood, exceeds the sustainable yield of the resource base, the traditionally stable relationship between demand and supply becomes unstable. With thresholds for sustainable yields now being crossed for so many resources, relationships that have been stable for centuries or millennia are becoming highly volatile in the late twentieth century.

Analysis of the relationship between the level of human demand and the sustainable yield of various systems is severely handicapped in many cases by a lack of data. For example, it is known that water tables are falling in many countries because water pumping now exceeds aquifer recharge. As noted earlier, some 21 percent of irrigated cropland in the United States depends on drawing down underground aquifers. But for most of the world, data on sustainable aquifer yields are not available. Few communities or countries know when rising water demand will exceed aquifer recharge; overpumping is often discovered after the fact.

We are also handicapped in analyzing the effects of excessive demand on natural systems by the interaction of biological, economic, and political systems. While academic specialists may understand the workings of individual systems and how they respond to stress, they seldom comprehend the interactions. Fortunately, a new effort to better understand this relationship - the project on Environmental Scarcities, State Capacity, and Civil Violence - was recently launched by the University of Toronto in cooperation with the American Academy of Arts and Sciences in Boston.

At some point, severe ecological stresses begin to manifest themselves economically on a scale that has political consequences. Rwanda is one tragic example of this, recently much in the news. While the attention of the world in the summer of 1994 focused on the tribal conflict between the Tutsis and the Hutus, there was ample evidence that tensions had been building as the relationship between all Rwandans and the natural systems on which they depend deteriorated.

Between 1950 and 1994, Rwanda's population increased from 2.5 million to 8.8 million. The average number of children per woman in 1992 of 8 was the highest in the world. Despite impressive gains in overall grain production, output per person declined by nearly half between 1960 and the early nineties. Land scarcity intensified as increasingly small plots were subdivided from one generation to the next. As population grew, the freshwater supply per person dropped to the point where Rwanda was officially classified by hydrologists as one of the world's 27 water-scarce countries.

But beyond these numbers was the quiet desperation that comes to an agrarian society when population growth overwhelms the carrying capacity of the land. Just as a lightning strike in forests in the American West is more likely to turn into an uncontrollable conflagration when it is unbearably hot and dry, so too are ethnic conflicts more likely to erupt when there are underlying tensions about food and the ability to earn a living.

Another essentially agrarian economy where the situation is in some ways even worse is Haiti. Once richly forested, it has lost all but 2 percent of its forests and much of its topsoil. In contrast to Rwanda, where the overall harvest has continued to rise, grain production in Haiti was one third less in the early nineties than it was in the mid-seventies, which means that grain production per person has plummeted. Political scientist Thomas Homer-Dixon observes that "the irreversible loss of forests and soil in rural areas deepens an economic crisis, that spawns social strife, internal migration and an exodus of 'boat people.'" He concluded that even when Aristide was returned to power, "Haiti will forever bear the burden of its irreversibly ravaged environment, which may make it impossible to build a prosperous, just and peaceful society."

The ecological symptoms of unsustainability include shrinking forests, thinning soils, falling aquifers, collapsing fisheries, expanding deserts, and rising global temperatures. The economic symptoms include economic decline, falling incomes, rising unemployment, price instability, and a loss of investor confidence. The political and social symptoms include hunger and malnutrition, and, in extreme cases, mass starvation; environmental and economic refugees; social conflicts along ethnic, tribal, and religious lines; and riots and insurgencies. As stresses build on political systems, governments weaken, losing their capacity to govern and to provide basic services, such as police protection. At this point, the nation-state disintegrates, replaced by a feudal social structure governed by local warlords, as in Somalia, now a nation-state in name only.

One of the difficulties in dealing with the complex relationship between humans and natural systems is that once rising demand for seafood or firewood crosses the sustainable yield threshold of a fishery or forest, future growth is often maintained only by consuming the resource base itself. This combination of continuously rising demand and a shrinking resource base can lead from stability to instability and to collapse almost overnight.

When sustainable yield thresholds are crossed, the traditional responses proposed by economists no longer work. One common reaction to scarcity, for instance, is to invest more in production. Thus the key to alleviating seafood scarcity is to invest more in fishing trawlers. But in today's world this only exacerbates the scarcity, hastening the collapse of the fishery. Similarly, as food prices rise, there is a temptation to spend more on irrigation. But where water tables are already falling, investing in more wells simply accelerates the depletion of the aquifer and the eventual decline in irrigation.

Once the demand on a particular system reaches a limit, the resulting scarcity sometimes spills over to intensify pressure on other systems. As seafood became scarce, for example, many expected that fish fanning would take up the slack. But maintaining the historical growth in seafood supplies of 2 million tons per year over the last four decades by turning to aquaculture, where 2 kilograms of grain are needed to produce 1 kilogram of fish, requires 4 million tons of additional grain a year for fish raised in cages or ponds. Growth in the seafood harvest, which once relied primarily on spending more on diesel fuel to exploit ever more distant fisheries, now depends on expenditures on grain as more fish are produced in marine feedlots. With grain supplies tightening, the feed may not be available to sustain rapid growth in aquacultural output.

Some effects of crossing sustainable yield thresholds are indirect. If excessive demand for forest and livestock products leads to deforestation and range-land degradation, the amount of rainfall runoff increases and the amount retained and absorbed for aquifer recharge decreases. Thus, excessive demand for timber and livestock products can reduce aquifer yields.

The combination of continuously rising demand and a shrinking resource base can lead from stability to instability and to collapse almost overnight.

As another example of an indirect effect, when carbon emissions exceed carbon fixation, as is happening with the massive burning of fossil fuels, the level of carbon dioxide in the atmosphere rises, altering the earth's heat balance. The principal effect is to trap heat, raising temperatures. This in turn affects all the ecosystems on which humans depend, from estuaries to rangelands.

Crossing sustainable yield thresholds of natural systems can alter world markets. Ever since World War II, the challenge to agricultural policymakers, except for a brief period in the early to mid-seventies, has been how to manage surpluses. Exporting countries typically insisted on using subsidies to bring farm prices above world market levels. This stimulated overproduction, leading to the use of export subsidies and competition for inadequate import markets for grain. Now that production is no longer keeping up with growth in demand at current prices, policymakers may once again be faced with managing scarcity and dealing with the politics of scarcity as the historical decline of grain prices is reversed. This new trend is already evident in the seafood market.

Managing scarcity could test the capacity of national governments and international institutions. For example, overseeing fisheries was relatively easy when the catch was tar below the sustainable yield. But when the catch overruns that level, reestablishing a balance between the eaten and the regenerative capacity of fisheries can be difficult. Similarly, countries that share water basins find it relatively easy to manage water supplies when there is a surplus, but if water becomes scarce and there is no longer enough to go around, the problem of management increases inordinately.

The natural systems on which the economy depends - whether it be the hydrological cycle or rangelands - are not merely sectors of the global economy. They are its foundation. If their productivity is diminished, then the prospect for the global economy will deteriorate. In an urbanized world where attention focuses on growth in telecommunications and computers and on the construction of the information superhighway, it is easy to forget that it is these natural systems that underpin the global economy.

One unfortunate and little noticed consequence of these various trends of environmental and economic decline is that international assistance programs are focusing more on aid and less on development. In effect, expenditures are shifting from crisis prevention to crisis management. Nowhere is this more evident than at the United Nations, where the budget for the U.N. High Commissioner for Refugees is nearly as high that of the U.N. Development Programme. The same trend can be seen in Somalia, where social disintegration and conflict reached the point where military intervention was needed just to deliver the food supplies needed to end famine. When deterioration reaches this point, military intervention can easily cost 10 times as much as the food assistance being given.

The bottom line of the growing instability between human societies and the natural systems on which they depend is political instability. This in itself is beginning to make economic development and agricultural progress difficult, if not impossible, in many countries. In some countries, the crossing of thresholds has international repercussions. When the growth in demand for food in a country as large as China begins to outstrip domestic productive capacity, the economic effects can spread far beyond national borders, altering the food supply/demand balance for the entire world.

THE CHINA FACTOR

The breathtaking pace of economic expansion in China promises to push demands on some of the earth's natural support systems beyond their sustain-able yields. (For a more extensive discussion of China's environmental situation, see Chapter 7.) When Western Europe, North America, and Japan industrialized during the century's third quarter, establishing the foundations of the modem consumer economy, they were home to some 340 million, 190 million, and 100 million people, respectively. By contrast, China, which is entering the same stage, has a population of 1.2 billion and an economy that is expanding much faster than the others did earlier. Given recent rates of economic growth, the World Bank projects that by 2002, greater China (which includes Hong Kong and Taiwan) will overtake the United States and become the world's largest economy.

We have no yardstick by which to assess the effect of this on demand for the earth's basic resources - simply because consumption levels have never risen so rapidly for so many people. Yet a sense of the potential effects on at least the world food economy is beginning to emerge. The escalating demand for food in China - where 14 million people are added each year and where the incomes of 1.2 billion people are rising at a record rate - could convert the world grain market from a buyer's to a seller's market, reversing the historical decline in grain prices.

The prospect of a massive grain deficit in a country that has essentially been self-sufficient comes on the heels of four decades of agricultural progress - progress that was particularly impressive following the agricultural reforms of 1978. These transferred land from production teams to individual families, unleashing energies that boosted the country's grain production by half - from 200 million tons in 1977 to more than 300 million tons in 1984. This put China ahead of the United States as the world's leading grain producer and raised output from the subsistence level of roughly 200 kilograms per person to nearly 300 kilograms.

On the demand side, China is projected to add 490 million people between 1990 and 2030, swelling its population to 1.6 billion - the equivalent of adding another Beijing every year for the next 40 years. Because its population is so large, even a slow rate of growth means huge absolute increases. Meanwhile, from 1991 to 1994, the economy expanded by a phenomenal 40 percent - an unprecedented rise in incomes for such a large number of people.

As incomes rise, people diversify their diets, shifting from overwhelming dependence on a starchy staple, such as rice, to more meat, milk, and eggs. When the economic reforms were launched in 1978, only 7 percent of grain was being used for animal feed; by 1990, that share had risen to some 20 percent, most of it used to produce pork. Now, demand for beef and poultry is also climbing. More meat means more grain - 2 kilograms of grain are needed for each kilogram of poultry, 4 for pork, and 7 for each kilogram of beef added in the feedlot.

The escalating demand for food in China could convert the world grain market from a buyer's to a seller's market.

China has eclipsed the United States in total red meat consumption largely on the strength of pork consumption alone. At 21 kilograms per person in 1990, China's consumption of pork is approaching the 28 kilograms (62 pounds) consumed by the average American each year. Although the consumption of beef, poultry, and milk in China is still minuscule compared with that of Americans, these too are beginning to rise.

Poultry was once a rare luxury in China, and the average person still eats only one tenth as much as an American, but people are quickly gaining an appetite for chicken. During the nineties, poultry consumption, starting from a small base, is expanding at double-digit rates. So, too, is the consumption of eggs. And the good life for newly affluent Chinese does not stop with meat and eggs: they are also acquiring a great enthusiasm for beer, and raising individual consumption for all adults by just one bottle takes another 370,000 tons of grain.

As the conversion of cropland to non-farm uses continues, the experience of three other countries that were densely populated before serious industrialization got under way - Japan, South Korea, and Taiwan - gives a sense of what to expect. Over the last few decades, the conversion of grainland to other uses in these countries has cost Japan 52 percent of its grainland. South Korea 42 percent, and Taiwan 35 percent.

As cropland losses proceeded, they began to override the gains in land productivity, leading to steady declines in output. While production was falling, rising affluence was driving up the overall demand for grain. As a result, by 1993 Japan was importing 77 percent of its grain, South Korea 64 percent, and Taiwan 67 percent.

Now the same changes are commencing in China as its transformation from an agricultural to an industrial society progresses at a breakneck pace. Building the thousands of factories, warehouses, and access roads that industrialization needs requires sacrificing cropland. The modernization of transportation is also claiming cropland as highways and railroads replace dirt roads and footpaths. Sales of cars and trucks, which totalled 1.3 million in 1992 and are expected to approach 3 million a year by the decade's end, will translate into claims on cropland for roads and parking lots.

Along with the continuing disappearance of its farmland, China is also facing the extensive diversion of irrigation water to nonfarm uses - an acute concern in a country where half the cropland is irrigated. With large areas of north China now experiencing water deficits, existing demand is being satisfied partly by depleting aquifers. In late 1993, Minister of Water Resources Niu Mao Sheng stated that "in rural areas, over 82 million people find it difficult to procure water. In urban areas, the shortages are even worse. More than 300 Chinese cities are short of water and 100 of them are very short." Satisfying future urban and industrial demand for water means diverting it from irrigation.

With the cultivated area declining inexorably, China's ability to feed itself now rests entirely on raising the productivity of its cropland. Rice yields in China, which have been rising toward those in Japan, are starting to level off, suggesting that the potential for lifting them further is limited to the potential gain of 20-25 percent associated with the forthcoming new variety mentioned earlier. (See Figure 1-6.)

Figure 1-6. Rice Yields, China and Japan, 1950-94

With wheat, China's other food staple, the rise in yield is also slowing. In the early eighties, China's wheat yield per hectare surged past that of the United States and has remained well above it, at roughly 3 tons per hectare. The big jump came immediately after the economic reforms of 1978, as yields climbed 83 percent from 1975-77 to 1984. During the following nine years, however, they rose only an additional 16 percent.

At issue is how much cropland will be lost and how fast. Rapid industrialization is already taking a toll, as grain area has dropped from 90.8 million hectares in 1990 to an estimated 87.4 million in 1994. This annual drop of 850,000 hectares, or nearly 1 percent - remarkably similar to the loss rates of China's three smaller neighbors in their industrialization heyday - is likely to endure as long as rapid industrialization continues.

Taking all these factors into account, it now appears likely that China's grain production will fall by at least one fifth between 1990 and 2030 (0.5 percent a year). This compares with a 33-percent decline in Japan since its peak year of 1960 (a fall of roughly 1 percent a year), a 31-percent decline in South Korea since its peak in 1977 (1.9 percent a year), and a 19-percent decline in Taiwan, also from a peak in 1977 (1.2 percent a year). Seen against this backdrop, the estimated decline of one fifth by 2030 in China may, if anything, be conservative. (See Figure 1-7.)

Figure 1-7. Combined Grain Balance, Japan, South Korea, and Taiwan, 1960-94

The resulting grain deficit is huge - many times the 28 million tons of Japan, currently the world's largest grain importer. In 1990, China produced 329 million tons of grain and consumed 335 million tons, with the difference covered by net imports of just 6 million tons. Allowing only for the projected population increase, China's demand for grain would increase to 479 million tons in 2030. In other words, even if China's booming economy produces no gains in the consumption of meat, eggs, and beer, a 20-percent drop in grain production to 263 million tons would leave a shortfall of 216 million tons - more than the world's entire 1993 grain exports of 200 million tons.

But even this is understating the problem, for China's newly affluent millions will of course not be content to forgo eating more livestock products. If grain consumption per person were to rise to 400 kilograms (the current level in Taiwan and one half the U.S. level), total consumption would climb to a staggering 641 million tons and the import deficit would reach 378 million tons. (See Figure 1-8.)

Figure 1-8. Projected Grain Production and Consumption in China, 1990-2030

The Chinese themselves have apparently been making similar calculations. Professor Zhou Guangzhao, head of the Chinese Academy of Sciences, observed in early 1994 that if the nation continues to squander its farmland and water resources in a breakneck effort to industrialize, "then China will have to import 400 million tons of grain from the world market. And I am afraid, in that case, that all of the grain output of the United States could not meet China's needs."

Will China have enough foreign exchange to import the grain it needs? China's trade surplus with the United States alone in 1993 was $23 billion, enough to buy all U.S. grain exports, with some to spare. Given the likely continuing growth in China's exports, it could import 200 or even 300 million tons of grain at current prices if its leaders were willing to use a modest share of export earnings for this purpose. Of course, this would mean cutting back on capital goods imports, which in turn could diminish the inflow of technology needed to sustain rapid economic growth.

But the far more difficult question is, Who could supply grain on this scale? The answer: no one. Since 1980, annual world grain exports have averaged roughly 200 million tons, close to half of which comes from the United States. But the United States, with a projected addition of 95 million people during the next four decades, is simultaneously facing growth in grain demand and losses of cropland and irrigation water to non-farm uses. As a result, the U.S. exportable surplus may not increase much, if at all.

At the same time, huge deficits are projected for other pans of the world. Africa, notably, is expected to need 250 million tons of grain by 2030 - 10 times what it currently imports. The Indian subcontinent is likely to rack up a deficit several times larger than its present one. Scores of countries with rapid population growth - among them Iran, Egypt, Ethiopia, Nigeria, and Mexico - will find themselves facing huge food deficits in the years ahead. In these circumstances, the vast deficit projected for China will set up a fierce competition for limited exportable supplies, driving world grain prices far above familiar levels.

No one knows exactly when this competition among importing countries will develop, converting the world grain market from a buyer's to a seller's market. If China turns to the outside world for imports, as projected, rising food prices will forcibly curb demand for food worldwide - reducing consumption among rich and poor alike. For the former, this will mean fewer fat-rich livestock products and, happily, less cardiovascular disease. But for hundreds of millions of low-income rural landless and urban poor, it means tightening their belts where there are no notches left.

Acute food scarcity and the associated political instability could bring the Chinese economic miracle to a premature end. At a minimum, this prospective deficit in China will force other governments - however reluctantly - to reassess painstakingly their national population carrying capacity and the closely related questions of population and consumption policies.

The bottom line is that when China turns to world markets on an ongoing basis, its food scarcity will become everyone's scarcity. Its shortages of cropland and water will become the world's shortages. Its failure to check population growth soon enough will affect the entire world.

It will probably not be in the devastation of poverty-stricken Somalia or Haiti but in the booming economy of China that we will see the inevitable collision between expanding human demand for food and the limits of some of the earth's most basic natural systems. The shock waves from this collision will reverberate throughout the world economy with consequences we can only begin to foresee.