An Essay Featured in The Fate of Beauty
On Combining Deirdre McClosky and Vaclav Smil to Determine the Real Source of Value
There was a plane wreck. We find ourselves stranded on a desert island. We loosen the tie around our neck and thank God for our cellphone. Our sister used to tell us that the cellphones weren’t useful, that they caused people to get addicted to social media and just inspired people to waste time, but lost on a desert island, who could possibly question their value? We pull out our phone and dial 911. No signal. The app with our account information is still open though. A million dollars. 100 pounds of gold. 10 bitcoin. There are no stores on the island, and night is an hour off. We stare at all of our money.
We need to find shelter. We haven’t eaten in hours. Our head hurts, and we can’t think straight. We look at our phone and think about DoorDash, but we can’t spend our money or request delivery. We know we won’t die if we don’t find food immediately, but the longer we go on without it, the harder it will be to maintain the energy to keep looking for food. As energy lessens, so lessens our capacity to regain it, so we need to act fast: the loss of energy only accelerates. We shove our useless cellphone back into our pocket and search the island. In the jungle, there’s a snake, but fortunately we learned a few skills on how to identify poisonous ones. We can tell by the color the reptile is deadly: we don’t try to eat it. The skill saves our life, but unfortunately the skill alone won’t create food: it has some value, but it won’t do everything for us. Fortunately, in the middle of the jungle, we find a tree with some fruit. And the tree is the most valuable thing in the world.
We eat the fruit and feel our strength return. As we sit there, we think about how funny it is that, wherever we went, food mattered. Whether in New York, a small farm, an abandoned island — we had to eat. We had to breathe too, and basically that meant our “energy system” had to be working. Ultimately, everything was built upon energy: money, status, society — it was all energy. And how little did we think about it…
We explore the island some more and see there is a lot of fruit. We can survive here, probably forever. Our energy problem is solved. But is this where we wanted to live the rest of our lives? Also, climbing trees to collect fruit was hard — was there a better way? We sigh and watch a parrot, who leaps up and flies from a tree out over the ocean — toward home. We regret that we weren’t so lucky as to be born with wings; then, all we’d need was a good meal, and we’d be off. In the ways biology didn’t bless us, we had to figure out ways to make up the difference. Fortunately, we did have a brain.
We locate some seeds and plant ourselves a garden that proves to be an efficient source of energy. Ideas help us increase efficiency, see patterns, and figure out how to improvise and improve: we’ve created solutions. We reflect on how if all ideas did for us was help us remember the phenomenal experience of a tree, and by extension help us say, “That is a tree,” ideas wouldn’t do very much for us: “ideas” and “perceptions” wouldn’t be very distinct. What made ideas valuable was our ability to look at a tree and imagine turning it into a boat — that was where the value of thinking really became apparent. Boat, a boat! Our eyes widen, but then we sigh. Unfortunately, ideas are also why we’re able to realize that “making a boat” wouldn’t solve our problem: there was no way we could paddle across the ocean back home. The idea to “make a boat” was a hint that ideas were the answer to getting us home, while the idea that “making a boat wouldn’t work” saved us from a big mistake. Our brains saved us and saved us from ourselves.
We laugh, and we remember about how our Dad always told us that what counted was “being practical,” that ideas and “abstractions” wouldn’t get us very far in life. Dad said that once while using a lawnmower, something that someone invented after decades of Dad using a manual push-power. Thanks to the invention, what took hours now only took half as long, and nowhere in nature did lawnmowers produce themselves. Someone imagined them existing, and then someone made them exist. If that person never invented the lawnmower, people wouldn’t even know they were missing out on the lawnmower. Ideas which were lost were ideas which weren’t even lost. Lost — we were lost — but unlike unmanifest ideas, people knew we were gone. They’d send search parties. There would be an aircraft.
A week passes, and we sit by a fire, waiting. We’ve kept the fire lit constantly after a thought crossed our mind. One morning, we sat under a tree, watching the waves roll in and offer us no inspiration, when a thought that had nothing to do with the water hit us. In fact, it had to do with fire. Now, late at night, we add some more twigs to the blaze. And suddenly we see a light blinking in the sky. We wave, screaming, but none of that use of biological energy makes a difference. We didn’t think it would, and so we carry out the next part of our plan: we start lighting all the piles of debris we gathered on the shore. At least twenty. And we start lighting trees. Soon, the island is blazing. A week later, we tell our family in the old living room that we never prayed so hard in our life.
Vaclav Smil is an economist and economic historian who specializes in “energy systems,” and I think his massive corpus is underappreciated. Here, there is one overarching idea of his that I want to explore, which is basically about how “energy is the real global currency,” which by extension means that “energy is the real source of value.” Once I heard this idea from Dr. Smil, it was so obviously true that I felt like a fool for not having realized it sooner. As of 2021, the current debate focuses on if gold is a “real storehouse of value” or if bitcoin can replace gold, but neither are valuable on a desert island. Energy, however, always matters. Energy matters nonconditionally.
Is biological energy the same as fossil fuel energy? The sources differ, yes, but both energies have value for the same reasons. If I need to cut grass, I can either use a lot of biological energy to do it with a manual push-mow, or I can use some biological energy and supplement the rest with a gas mower. There is x amount of energy needed to cut my yard, and I can meet that threshold either with pure biological energy (from “the system of me”), or I can meet that threshold with a combination of fossil and biological sources (from “the system of me plus the lawnmower”). In this way, all tasks can be thought about as requiring “a certain amount of energy,” and the question is simply “How do we reach that amount?” Well, riffing off Deleuze and Guattari, it’s always with machines of some kind: biological machines, mechanical machines, computer machines, etc. Where there are machines, there is energy, and likely where there is energy, there are machines.
There is a strong correlation between the amount of energy a society uses and its overall wealth, so much so that it’s tempting to say wealth is energy.¹ However, it’s not necessarily the case that the country which “uses the most energy” is necessarily the country with the highest GDP: sometimes, the “most energy use” correlates with “fastest growth,” and sometimes “the most energy use” can mean a country is using energy poorly and inefficiently.² It depends, but regardless it’s clear that energy plays a critical role in the development of a society. Yes, this correlation is primarily modeled between “fossil fuel use” and GDP, but if we take seriously the point that all ways of using energy are ultimately “toward” accomplishing goals that require some use of energy from some source, then a world where we don’t use fossil fuels to accomplish x is a world where we would use biological energy to accomplish x (assuming it would still be possible, given time constraints, physical realities, etc.). This being the case, a correlation between fossil fuel and GDP suggests a correlation between general energy use and GDP. This point becomes clear once we grasp that “fossil fuel” is a phrase that basically stands in for “energy use,” and GDP basically means “energy consumption.” We use what we consume, and we consume what we use.
Every piece of furniture, every restaurant, every stoplight, every laptop, every product — everything is possible because of some use of energy. I drove to the store to pick up a laptop, which was at the store because someone drove there, which was made at a factory thanks to parts which energy brought into existence — I could keep going: the whole supply chain permeates with energy use, in every nook and cranny. Now, in our modern economy, most of our productivity is thanks to fossil fuels, which of course proves problematic regarding the environment — I’m not here to argue against the need to introduce renewable resource. My point is only that energy is ubiquitous: where there is no energy, there is no life.
In addition to Vaclav Smil, the other living economist who most dramatically shaped my thinking was Deirdre McCloskey, who made it very clear that technology and creativity are fundamental to wealth. There is no wealth if there is no creativity, even if there is energy, for we have no ability to channel that energy toward efficient and/or new ends.³ For the details of this argument, please see McCloskey’s incredible trilogy, as well as “The Creative Concord” by O.G. Rose.
However, creativity without energy could accomplish little, as energy without creativity couldn’t do much either. If I had the idea for New York City but didn’t have fossil fuels, the city would be mighty hard to build; likewise, if I had all the gas in the world but, as a prehistoric person, didn’t have the “human capital” or knowledge on how to dig up the gas and use it well, it wouldn’t matter (a point made by Thomas Sowell). Natural resources alone aren’t sources of wealth, but ideas without energy can’t do much either. Thus, wealth is a result of energy and ideas (more particularity, creativity) dialectically relating to one another, and it is out of that dialectic that value is realized. The real source of value is a dialectic between creativity and energy.
Animals do not need creative ideas to survive, and in this sense energy systems don’t require ideas to get by and function. However, if we are to advance and establish complex societies, ideas will be needed, but ideas won’t get us far if we don’t have food. Without food, we don’t have biological energy, and the amount of energy our brains use is extraordinary. Without energy, our brains struggle to think, but if we don’t think, our brains are practically the same as our minds. In other words, we practically are not very distinct from “mere biological systems” without ideas: we also cease to (“meaningfully”) be “mental systems.”
Humans are animals but not “merely animals” — or at least that is what we sense. Why? Well, it’s because humans are “biological energy systems” (like animals) but not only that: we can paint pictures. What G.K. Chesterton said about prehistoric man comes to mind here, from the start of Everlasting Man, which is described in this section from “Philosophy & Art” by O.G. Rose:
G.K. Chesterton [notes] that ‘people have been interested in everything about the caveman expect what he did in the cave.’⁴ And what do we see in the cave? A lot of cave drawings. Primitive man was an artist. We are told a lot about the violence of the caveman and brutishness, but Chesterton suggests the common depiction is ‘simply a myth.’⁵ ‘Art is the signature of man,’ Chesterton says […]⁶ This is important for philosophy because philosophers have had a long of history of using “state of natures” as foundations for their philosophical systems (Hobbes and Rousseau come to mind). But none of the great philosophers viewed primitive humanity as an artist […]
There is something fundamental about human beings which is creative and artistic, so it should not surprise us that creativity is part of the dialectic which generates “real value.” Additionally, if we can link “minds” with “ideas/creativity,” then we can say there is something fundamental about “minds” for humans. Though animals have brains, they don’t seem to have “minds” like humans do (which “On Thinking and Perceiving” by O.G. Rose suggests isn’t necessarily a bad thing), and thus humans are also “mental energy systems.” This is partially why we can generate creative ideas. Considering this, I think we can associate “the brain” with energy while we associate “the mind” with creativity (suggesting a dialectic, as one is needed because “mind and brain” are not identical, as the work of Cadell Last shows). Ultimately, this means we cannot generate “a unified theory of value” — it has to be a “dialectical theory.”
Because I think of the idea of “building a house,” it is possible for me to “channel my energy” toward that end: if I didn’t have (creative) ideas, I could channel my energy relative to my instincts, emotions, and impressions, but that’s about it. I could live like an animal, which wouldn’t be all bad (it might be a happy life), but if here we are trying to establish the sources of value for “human civilization,” the critical role of ideas must be highlighted. If humans were just animals, then energy would be the source of all value. But humans are not only “physical machines”: we have minds, and that means we are “physical and mental machines.” Thus, there is a second source of value: ideas. We need energy so that our brains produce ideas, but ideas also cannot be reduced to “just being energy.”
Problems are solved by ideas: if I need to move a tree that has fallen into my field, it will require ideas for me to figure out how to move the tree; if I am hungry, I will need to figure out how to find food; and so on.⁷ Though perhaps “animal society” is different, “human society” is defined by “idea use.”⁸ But again, I can only come up with ideas because I have energy to think, as I need energy to act upon ideas and do so efficiently. Ideas alone are not enough — what I only think is practically nothing — but energy which isn’t “directed” by ideas is too random to construct a civilization with or on. It is a dialectic or nothing.
As I hope the short story at the start of this paper made clear, it was energy and ideas that saved our stranded protagonist, not merely one or the other. Our protagonist constantly considered ideas on how to use his biological energy to escape the island, as simultaneously his biological energy made it possible for him to generate ideas. In this way, our ideas inform us on how we should use our biological system, as our biological system influences the effectiveness of our mental system. If we haven’t eaten, our minds might suffer, but if we’re thoughtless, we might not be able to figure out how to gather food (effectively): thus, a dialectic emerges (Hegel is inescapable yet again).
I think it’s safe to say that there are generally two things people do every day: consume and think. We also breathe, yes, and it could be argued that we couldn’t eat without air, but that just means that humans, every day, maintain their “biological energy systems,” as they also maintain their “mental energy systems.” We are always using energy in both ways, and it is this dialectical fact that unveils how “real value” emerges. Value is found in energy and ideas dialectically relating, and so “changing the world” will also be a matter of invention, adjusting, etc. energy technologies and creativity. This means energy and creatives, entrepreneurship, and the like determine our destiny — the group of people called the “Artifex” in “The Creative Concord” by O.G. Rose, as positioned in contrast to the classes Marx calls the bourgeois and proletariat (the Artifex “makes the means of production” while the bourgeois “owns them” and the proletariat “works them”). Basically, the Artifex determines our destiny, and it is the Artifex which figures out how we should use energy, as it is energy that makes the Artifex possible. If the Artifex dries up, energy won’t be used well; if energy dries up, the Artifex won’t be able to accomplish much. With energy, we might survive, but without the Artifex, we won’t thrive.
Today, inspired by bitcoin and cryptocurrency, a lot of people are asking about “real storehouses of value,” and bitcoin is certainly in the discussion regarding a “more stable currency” (perhaps it is not by chance that bitcoin takes so much energy to produce). But a mistake is often made in this discussion: when people say, “real storehouse of value,” they use the phrase as a simile for “secure storehouse of value.” “Real sources of value” are necessarily secure (by virtue of actually being valuable), but we cannot be so sure that a given “secure source of value” is “really valuable” (under all circumstances). Bitcoin is clearly secure, but is it real? Not on a desert island, no, but if we never end up on a “desert island,” then bitcoin is “practically” a “real/secure storehouse of value.” Under these circumstances, perhaps bitcoin can “practically” be “a real source of value,” but not technically, because there are conditions which would unveil that bitcoin didn’t entail value “in of itself.”
Philosophers are famous for “thought experiments” where they imagine “states of nature” to decide if humans are naturally brutish or violent (Hobbes and Rousseau come to mind), but economists should do the same. If we imagine a desert island where I am abandoned and ask, “What is the real storehouse of value?” we can start to solve the great riddle. Gold won’t help me on the island, neither will money, status, connections, social capital, experience, or crypto currency. Sure, in certain conditions, money, status, etc. are very valuable, but our thought experiment shows us that only two things are nonconditionally valuable (ideas and energy). This is critical to determine if we are trying to locate “real storehouses of value”: any value that is conditioned, meaning it requires x circumstances for that value to be realized, cannot ultimately be “the real storehouse of value.” Sure, energy and ideas only have value if we are alive, but that basically gets us to axioms: if a thing is alive, energy is a paramount; if a thing is to be alive and “meaningfully distinct” from animals, ideas are also paramount. Thus, the real sources of value for human economies are ideas and energy, dialectically relating.
“Real” and “secure” shouldn’t be used as similes, even if “normally” the mistake isn’t a problem. Yes, perhaps gold and bitcoin are both more secure than dollars, but that doesn’t mean they are real sources of value. Because “secure sources of value” are practically “real sources of value” in human civilization, it’s very easy to conflate these categories together, and if human civilization never fails, “secure sources of value” are practically identical with “real sources of value.” And most of the time this “technical” mistake is harmless, but when it comes to the question of what we should focus on to determine how our economy should develop into the future, possessing a clear sense of the real fundamentals is essential. If we don’t, the State could prioritize funding the wrong things, we might approach leisure with the wrong mindset, and so on. In this way, “the fundamental value island thought experiment” (a mouthful) could prove useful, for it solidifies how energy is a real source of value but not alone. Yes, it is energy alone that keeps us alive, but for wealth production, creativity is also necessary.
Energy is both a “real source” and “secure source” of value, because no one can deny or argue that “energy has value.” We need energy to argue against the value of energy, but we don’t need to own bitcoin to critique bitcoin: when trying to determine “a real source of value,” a great test is to determine if we can critique the entity without using the entity we are critiquing (this unveils if it is “the ground of being” that makes possible critique, thus verifying the value). Something similar can be said about ideas: we need ideas to argue why ideas are not fundamental. We don’t need to use a computer to argue against the ultimate value of computers, and we don’t need to be eating food to say that food is overrated. Personally, I can’t think of anything but ideas and energy as things we must use in our critiques of them: we could say “health” and “air” are like this, but both “health” and “air” fall under the category of “energy system,” and so the necessity of health and air only strengthen the case for the predominance of energy.
Ultimately and technically, it is energy and ideas which, dialectically together, are “the real source of value.” Therefore, if we and our government want to increase “real value,” we need to focus on making civilization better at using energy and thinking up ideas. If National Debt increases a trillion dollars, but that trillion was put toward improving “the dialectic between ideas and energy,” there would be very good reason to believe that this debt was ultimately an investment that would pay itself off. If the National Debt increased for other reasons, our confidence shouldn’t be so secure.
Economics has generally been thought of as “the study of how to distribute limited resources,” and certainly there is a lot of truth to this idea, but perhaps the majority of “the truth” comes from a failure to prioritize and focus on the actual “real source of value.” We’ve been getting it wrong for a long time (or at least not getting it systematically right), and that has resulted in “scarcity” and “value” being conceptually merged. By focusing on ideas and energy, I hope we can change this problematic tendency, which incentivizes the creation and preservation of scarcity in the name of value. Where scarcity is valued, value will be scarce.
Many economists and thinkers have debated the problem of “value being tied to scarcity,” which entails the problematic notion that value can increase as things become rarer. If there was an infinite supply of gold, gold would be worthless; if money was printed off carelessly, money would lose value; and so on. Value and price increase with scarcity, but this means there can be an incentive to create (artificial) scarcity. Oil companies may reduce production so that the price of oil increases; food companies may do something similar to increase margins; and so on. A world where value is tied to scarcity is a world that may suffer for it, but fortunately once we understand “the real and dialectical source of value” in an economy, scarcity no longer needs to be perceived as necessary. In fact, abundant value becomes possible.
To address an objection that might be forming in the minds of readers, please note that oil is a source of energy, but that doesn’t mean it is energy, and it is not the case that all sources of energy are equal or equally necessary. In fact, I would argue that if we take “the essentialness of energy” seriously, the importance of developing “renewable energy” will become all the more undeniable. If indeed “energy consumption” and “GDP growth” strongly correlate, then an “infinite energy source” will open up the possibility to “infinite GDP.” Far from adding value, making “energy consumption” scarce threatens GDP, as does making ideas scare. This hints at why energy and ideas are different and indeed “the fundamental sources of value”: while money, land, bitcoin, etc. increase value through scarcity, energy and ideas increase value through abundance. While increasing available land and bitcoin could hurt the economy or prove impossible, making energy and creativity abundant would make the economy richer.⁹
Land, bitcoin, oil — all of these increase in value as they increase in scarcity. Well, the price goes up — I suppose we could argue that the “intrinsic value” doesn’t change, just our perception of it. Regardless though, in society, generally, “intrinsic value” and “price” are “practically” the same even if not technically identical — but this worsens our problem, because it becomes harder for us to tell the difference between “price” and “value” with increased socialization, and as that becomes more difficult, so it becomes more difficult to identify “the real source of value.” This is where our “desert island thought experiment” hopefully proves useful, for it hopefully helps us see past “price” in favor of “real value.” Energy and ideas pass this test, and in learning this, we learn what society should prioritize making abundant.
There is an old debate on if Capitalism is “zero-sum,” meaning that the benefits of some are the negatives of others, or if Capitalism is “non-zero-sum,” meaning everyone benefits together. In my opinion, Capitalism has a strong claim to being (mostly) “non-zero-sum,” but the “valuing of scarcity,” in my opinion, keeps Capitalism from being as “non-zero-sum” as it could be. Additionally, it would seem that Capitalism is “non-zero-sum” ultimately thanks to energy and creativity (“non-zero-sumness” correlates with the size of the Artifex, to put it simply): I would argue that Capitalism is “non-zero-sum” despite (temptations of) scarcity, that the wealth created by energy and creativity is so great that it can elevate and evolve a socioeconomic order even if it is drunk on “scarcity value.” Though important, the glory of Capitalism doesn’t come simply from the effectiveness by which it distributes limited resources; rather, as Deirdre McCloskey writes on, it’s glory comes from its unique capacity to incubate creativity and grow the Artifex, which in turn entails its unique capacity to direct, channel, and manifest energy. Where there is creativity, I can invent computers, which can use energy in news way, where creativity is lacking, I can own all the energy in the world, but my quality of life will not be improved. That doesn’t mean my life will necessarily be bad, but it does mean I’ll never figure out how to invent wells, how to use electricity, or the like.
As far as I can tell, energy and ideas are the only sources of “abundant value” out there, while just about everything else is a “scarcity value.” On a desert island, the value of energy and ideas would not decrease the more of each I possessed. In fact, I would get more value as I gained more energy and more ideas, not less (a point that also suggests why energy and ideas are indeed axiomatically and noncontingently sources of value). Where there are more ideas, the more they can build on one another; where there is more energy, the more able we will be able to live life to the fullest. Ideas and energy benefit from their abundance: they, in themselves, are “non-zero-sum.” The more energy there is, the more energy we have to use energy, as it is the case that the more ideas we come up, the more ways we think of to use and create ideas. But if we make money with money, money can lose value; if we make copies of baseball cards, the cards can lose value; if we clear trees to make more open pastures, we run the risk of making the available land less valuable.¹⁰
In many respect, scarcity is the opposite of creation: if I create, I am reducing scarcity. And yet at the same time every novel, every business, every motion of the hand even, is the only expression of creativity and energy that will ever be that expression of creativity and energy. There is a radical “one-of-oneness” to creativity, even though creativity is at the same time theoretically endless. Oil is not theoretically endless, and neither is money or gold, but creativity never must dry up. Thus, I could theoretically create an endless abundance of “one-of-one”-entities, which suggests a unique and powerful way that creativity creates value. There is a “kind of” scarcity in creation, but it is not the same kind of scarcity which gives gold value. There is a “limitedness of uniqueness” to creativity, which entails a kind of scarcity, but isn’t merely scarce. A unique creative good is valuable in of itself and scarce secondarily, while gold is scarce primarily and then valuable in of itself. To help make the point, Beethoven’s 9th doesn’t lose value if a billion people hear it, which is to say the value is not tied to who consumes it. On the other hand, if everyone on the planet owned gold, gold would be little better than an average stone.
What is created doesn’t have to lose value as it is consumed by more people (though this can occur), and the same holds true for energy. If I am on a desert island by myself, with ten people, or with a thousand, energy will still have value. The value doesn’t correlate to the number of people who need it (especially if the source is abundant), nor does the value collapse if everyone on the island uses it. Sure, if we set up a market, perhaps the price could change, but the situation makes it clear that price and value are not equivalent (even if in society they “practically” are sometimes). The same can be said with good ideas: if a hundred people come up with the same way to improve computer processing power, the idea still has value. No, not everyone will perhaps obtain equal ownership rights, but the invention itself will maintain its value and ability to make life better regardless who gains the property rights. Perhaps my idea to fix computers has no value “to me” because someone else came up with the idea first, but that doesn’t mean the idea “loses value in of itself.” If the idea is good, the value is there, regardless ownership.
In a way, the value of ideas and energy are factual: they aren’t subjective at all (we could say the value of energy and ideas is object-ive, as in “based in facticity”: the value is not “contingent upon subjectivity”). The value of money, gold, etc., result from subjectivity: in a world where humans didn’t exist, money — mere paper — would have no value. But a world full of animals would still need energy (and even if there were no animals, the universe needs energy to exist), and if animals could think of ideas on how to store food for winter (for example), that idea would have value (as would be the case if animals could come up with “the idea” of “gold being a storehouse of value,” etc. — and please note all fiat currencies were first ideas). Fine, that’s true regarding energy, but how is it that “an idea” can be “fact-based?” Well, it’s because “the idea” of how to create fire with sticks and stones simply reflects a possible arrangement “in” the materiality of the world. That possibility is there, in materiality, just not immediately “realizable” without “seeing past” materiality at “what could be.” Critically, this doesn’t mean subjectivity “creates” the possibility of “using sticks and stones to make fire,” a key distinction: we “create” whatever causality never arises to on its own, but we can only do that because “the potential” is “in” materiality. If it wasn’t, the idea to “make fire with sticks and stones” would prove useless (the ontology of materiality has to allow it).
Thus, energy and ideas don’t have value because humans exist: they have value because they are what they are. Maybe only humans can think of ideas, and maybe only humans (thanks to ideas) can use energy in certain ways, but that doesn’t mean the value itself is “human contingent.” Energy and ideas have value because energy and ideas have value in their very being, if only realized. Yes, perhaps only humans can realize that potential, but that doesn’t mean humans create the potential ex nihilo. When it comes to ideas and energy, value is what we creatively realize.
That’s all well and good, but aren’t there “bad uses of energy” and “bad ideas?” Of course, but the beauty is that the more ideas we have, the more we aren’t at the mercy of the “bad ideas” we generate (having nothing else), and the better we can become at telling the difference between “good ideas” and bad ones (and, in helping us determine this, arguably even “bad ideas” have value). What about energy though? Well, fossil fuels hurt the environment, but that critique would only suggest we need new sources of energy, not that we should stop using energy entirely (a new source which fossil fuels will likely help us discover, seeing as gas could power the airplane that gets us to the conference where all the scientists are gathered to brainstorm).
It should be asked: how do we determine “bad uses” of energy? By the fact that the use is not productive or because it causes environmental damage? Fair, but please note that this is a judgment based on consequence: by definition, if someone uses energy x way versus y way, that person must believe it was good to use energy x way (for there is no such thing as a “bad motivation,” as we learn from St. Augustine). Whenever we do something, we must believe it is somehow good to do (or at least “best” compared to the other options we know about), and so all uses of energy must be toward an idea of the good. That doesn’t mean the use is good (ultimately), but it does mean “good” was involved in the calculation of the use. However, I think this is important to note so that we approach the question with humility and understanding.
Now, a given use of energy could easily give rise to a negative consequence, but the more uses of energy there are, the higher the likelihood we start determining which uses of energy are “more matched” with the good than others. As we carry out this experimentation, we can become more efficient with our energy use, meaning we can use the same amount of energy to do more (all as we get better at determining “which energy uses” are “most likely good”). All this suggests a need for a “laboratory,” a place where different ideas and energy-uses can be tried so that we can figure out “what is best” (as best we can). If we agree with Hayek and his arguments (which are explored elsewhere in O.G. Rose), then Capitalism is best at providing this laboratory. Communism has access to ideas and energy just like Capitalistic markets, but arguably it doesn’t provide the same “laboratory” due to “Central Planning,” which means it doesn’t generate value like we would hope. Nor does Communism seem to provide the best incentives or “values” to motivate creativity — a case made by McCloskey. Considering this, please don’t mistake me as saying that all any system needs is energy and ideas, or that the system with more of both will necessarily do better. The system must also make space for experimentation and “testing,” and that seems to be a special secret to Capitalism (“the system of price mechanisms”). That said, a Capitalism without energy and ideas would likely be deficient and a Communism with both comparatively better.
To return to the main point, what if Sam can use energy for purpose x, which is good for Sam but bad for Sarah? Well, that’s certainly a possibility, but if Sarah also has energy, she will have opportunities to counter Sam’s efforts. “Monopolies on energy” are where real problems can emerge and experimentation comes to a standstill, so this again suggests that an abundance of energy is best. Scarcities of energy can cause trouble, as do scarcities of ideas (for if one group of people is the source of all ideas, they become hyper-powerful). In this world, we cannot avoid “bad consequences” brought about by what we believe are “goods idea” or “good uses of energy,” for all we have are our projections and estimations: it’s inevitable we’ll make mistakes. But where there is an abundance of energy and ideas, mistakes will not be “monopolistic” and prone to tear down the whole system, and also the mistakes will quickly be replaced by advancements. The more actively we generate ideas and use energy, the more efficiently we can improve and advance. Abundance itself can be its own corrective if it maintains value, and in energy and ideas, it can.
With oil and gold (to make an example), we cannot breakup a monopoly on these entities without either government intervention or risking their value by making more oil and gold. Neither of these options is preferable, and even if the government did break up the monopoly in once instance, the potential for new monopolies would still be present. But we can breakup monopolies on ideas simply by becoming more creative ourselves, as we can breakup monopolies on energy by making more of it, and neither of these actions will threaten the value of either energy or ideas. Since ideas and energy don’t rely on scarcity, correcting monopolies or inequality will not threaten the value present in the monopoly. Yes, there can be a “practical monopoly” on gas, but not energy in general, and that means there is always an opportunity to breakup the monopoly (though that isn’t to say government should never have a role, a point which turns us to “Demand” by O.G. Rose, which addresses Keynes).
With monopolies which gain value thanks to scarcity, we cannot defeat the monopoly by increasing the abundance of what they own without risking the value that makes breaking up the monopoly beneficial and desirable in the first place. Thus, a society that prioritizes energy and ideas is a society that will be uniquely positioned to stop monopolies — abundance is our tool, and the future should be made in “the image and likeness” of “abundant value.”
Though it’s another topic for another time, a reason NFTs are fascinating is because it seems we are trying to say that something we mint “has value” because energy was put here well.¹¹ If all value results from energy, then we can start to see why art and products at the store indeed possess value: both are storehouses of energy. Biological and mental energy went into the cup, as it went into the novel; thus, both have value even if they don’t have prices, because energy went into both, and where there is energy, there is value. Perhaps not “great” value — that would require a dialectic with ideas to determine — but value all the same.
As energy systems like fossil fuels and computers replace the need for biological systems, we humans will have more free time to use our energy as we like. This is the problem of leisure, addressed by thinkers like Bertrand Russell and Johannes Niederhauser, and the question is how to have a leisure that “uses energy well” versus try “not to use energy.” Lazy is a state where we “don’t use energy” (generally), whereas leisure is an effort to “use energy well when other energy systems have freed us of the need to be machines for other tasks” (I didn’t say “productively” here, for “productive” is a loaded term). “How do I use my energy well?” is a question we should be asking ourselves, and I prefer this question compared to “How should I be productive?” (despite how strange the question might sound: if you prefer, ask, “How can I use my life well?”). This is because the word “productive” is too “captured” by Capitalism and economics (to allude to Deleuze), so to ask, “How can we use leisure productively?” almost necessarily must strike us as an example where Capitalism takes away our leisure yet again. It sounds like we should turn our “leisure” into “work,” and “work” is defined in our society as “that which we get paid for,” which thus means we must plug our leisure into a job. And so we are “captured” by Capitalism yet again (it seems embedded into the language) — what can be done? Well, to start, using different terminology would help: instead of asking about “productive leisure,” we should instead ask questions regarding “energy use” and “How can I use my leisure creatively?” Asking about “energy” and “creation” is to focus on the “ultimate sources of value” for our economy, whereas “productivity” might be asking about those sources of value, but it won’t be so clear or direct.
As discussed in “Joy to the World” by O.G. Rose, this point also suggests why “intrinsic motivation” is so critical in the discussion of economic destiny. “Intrinsic motivation” is “the way we on our own decide how to use our energy”: we could call it “intrinsic energy use.” As a corollary, to possess “intrinsic motivation” — to do something “for its own sake,” as an “end in itself” — we must be able to discern things as “intrinsically valuable” and so intrinsically motivating. When we see “intrinsic value” in a novel idea, for example, we are intrinsically motivated to create it and/or do something about it, and thus the ability to “discern intrinsic value” is everything, for that will be the very act which creates “intrinsic motivation.” And that is an idea, a mental capacity: if we don’t have a strong “mental system,” we likely will struggle to discern “intrinsic value” and struggle to be “intrinsically motivated” accordingly.¹²
If we cannot discern intrinsic value, we cannot be intrinsically motivated, and if we have more “free time,” that ability will be paramount if we are to use our free time “well.” Where mechanical and computational machines can “take care of society for us,” if we want society to keep advancing, creativity will be everything. Once “the problem of energy” for basic survival is addressed, the main focus will likely orbit questions like, “How should we use our mental energy?” Well, creatively.
Human civilization is fundamentally about ideas and energy, the thinking of Deirdre McCloskey and Vaclav Smil. They are the real sources of value, while money, information, and the like follow secondarily. This isn’t to say information, money, gold, and so on have no value and don’t improve human society, but it is to say that are not the “ultimate sources” of value: they are useful because they are built on the foundations of other things. Energy is the “fundamental value” of our physicality, while ideas are the “fundamental value” of our mentality. We are dialectical beings, “(meta)physical,” and so are our societies, made in our “image and likeness,” as are the values according to which they operate and thrive.
Generally, we are in an age where the mechanisms of the economic system are in place (price mechanisms, competition, etc.), but those alone will not be enough without energy and creativity, so now everything is about those. And we need to focus on them, because we have perhaps used up “the low hanging fruit” of technological advancement and energy sources: the technologies in the past were generally simpler to make than what we must discover now (even if future discoveries wouldn’t be possible without past innovations to build atop). It is often said that this is an age of increased specialization which requires increased technical skill, and I generally agree: this being the case, we will need rising levels of creative and intellectual ability. If we don’t focus on these abilities as “fundamental sources of value,” it is doubtful we will rise to the occasion.
The more efficiently a society uses energy, the more it could unlock its creative potential, and as creative potential is realized, energy will likewise be used more efficiently: the relationship could prove mutually reinforcing. Unfortunately, if ideas are wasted, this might cause energy to be used less effectively, which in turn would hurt our capacity to use energy well: the two could fall together. The fates of energy and creativity are deeply tied, and out of their dialectic, human society emerges.
If I can access food easily, I have more time to think, and when I have more time to think, I can come up with better ways to use energy, unlocking more time to think — on and on. This suggests that ultimately the efficient use of energy and creativity will bring us to a place where we must ask questions about “leisure” and “free time,” for that will be a state where “mental energy systems” will become primary to us, because mechanical and/or computational energy systems will play dominate roles in maintaining the economic and productive infrastructure of society. We will be free to focus on “creative output,” and what will we do with that freedom? Nothing if we’re not ready for it, but that might require Absolute Knowing — but that is another topic for another time.
It’s another topic, but James K. Smith, Charles Taylor, Daniel Fraga, and others make the point that our environments work on us and impact what we desire and how we think about ourselves. When we live and operate in a socioeconomic order that values scarcity, “secure sources of value,” and even seeks monopoly power (without upsetting the regulators), this will likely impact how we function and form ourselves as people and subjects. I don’t think the consequences of this have been all good, but imagine if we lived in a socioeconomic order that said in its “medium” (and “the medium is the message,” as McLuhan taught) that “the fundamental source of value was a dialectic between energy and ideas?” How would that impact our self-identifies? Well, where resources and money are seen as “fundamental sources of value” (like now), we will likely focus on ourselves “as physical beings” and seek to join financial market, all while viewing the arts as “impractical.” But if creativity and ideas are suddenly paramount, then we might view ourselves as more “metaphysical” and really focus on the importance and power of thinking (which, as Bard and Elung argue, even if possible thanks to physics, cannot be reduced to physics). Creativity will suddenly become practical, and we might take seriously parts of us that speak to “nonphysical needs,” all of which might help us escape what John Vervaeke calls “The Meaning Crisis.” Hard to say.
In conclusion, what ultimately creates value for a society is not a “single storehouse” or “single source.” Ultimately, it is a dialectical relationship between “energy” and “ideas.” For too long we have searched for “a single source of real value,” looking to gold and bitcoin, but really value cannot be located in a single place. It is an emergent result of a dialectic between energy and creativity: even if we achieve “a creative concord” between Marx’s classes, there must still be a dialectic between those classes and energy. Energy and ideas can get us off a desert island. They can change our world.
¹See “World Energy Use,” as can be found here:
²See “Primary energy consumption worldwide in 2020, by country,” as can be found here:
³Or at least we can say there is no “new wealth”: if we couldn’t create, perhaps we’d have “the wealth of food” to survive, say like a deer or a cat, but we wouldn’t get much further than “the wealth of basic needs” — which I’m not even sure is a kind of “wealth.” There’s value, yes, but I’m not sure about wealth.
⁴Chesterton, G.K. The Everlasting Man. San Francisco, CA. Ignatius Press, 1993: 28.
⁵Chesterton, G.K. The Everlasting Man. San Francisco, CA. Ignatius Press, 1993: 30.
⁶Chesterton, G.K. The Everlasting Man. San Francisco, CA. Ignatius Press, 1993: 34.
⁷Perhaps there are some instances where this doesn’t hold, say if I see a train heading my way, for example: I might instinctually leap out of the way, without thinking about it, but even here I’m not sure if this instinct only comes into existence because I have the idea that “dying is bad” or something. Still, “complex problems,” like building a plane or stopping Global Warming, make it clear that ideas are necessary and irreplaceable. If we don’t need ideas to avoid a train, we need ideas to reach the moon.
⁸Please note that “idea use” isn’t the same as “just thinking ideas and never acting on them,” as similarly “having natural resources in the ground” isn’t the same as “using gas”: both require action to move across “ontological realms.” The mental must move into the physical (“sensualization,” as I call it, which brings in existential risk), as the physical must be shaped by the mental. The physical and metaphysical must dance, for we don’t know a thought until it is actualized, only think we do, as we don’t understand physicality we only touch.
⁹Personally, I struggle to think of anything else that increases value the more of it there is, thus further evidence that ideas and energy are the fundamental sources of value.
¹⁰Yes, clearing land could be a step in the direction of increasing its yield, but this act that could increase yield also runs the risk of lowering the value of the land by making “cleared land” less scarce. In this way, most “supposed storehouses of value” entail risky tradeoffs between “yield” and “value,” but not energy or ideas: the value of energy doesn’t fall as we use more of it (even if the price falls), and it is in fact the yield of energy that makes it intrinsically valuable. It is only with things that aren’t ultimately “intrinsically valuable” that separate yield from value, while things that are “intrinsically valuable” tend to combine yield with value. The more we use land, the more we can threaten its capacity to “yield” a crop (say by overusing the pasture), and yet the land itself could still have value and even increase in value as its yield declines thanks to a scarcity of land. “Scarcity” seems like it can divide “yield” from “value,” which in one way sounds good, because then we can make money off the field both from what it produces and what we can sell it for, but this “double source” of money comes with a cost: it introduces scarcity into the equation, which introduces the possibility of “zero-sumness.”
If a thing’s use can be divided from its value, then the thing cannot be intrinsically valuable: there must also be a “perceived” value based on the socioeconomic context (in which people want the thing for some reason). The same applies on if a thing has no use at all: if a thing cannot be used for something, then it has no value. An intrinsically valuable entity contains all it needs to be used: nothing needs to be added to it (it just needs to be used). I don’t need to add anything to a good idea (even though I may improve on it with time): I just need to realize it. I don’t need to add anything to energy: I just need to figure out the right way to use it. But bitcoin only has value if I “add a costumer” to it, per se, as land only has value if I “add a house or crop to it.” Most things we think are “intrinsically valuable” are only valuable because the social order has “added something to it,” per se, while energy and ideas are valuable on a desert island. No social order is needed: all that is needed is for us to be present. But isn’t that a condition? No, it’s axiomatic.
Land is not intrinsically valuable: it has value because it is a “means” (we can build a house on it, grow plants, or sell it for a profit). And critically there is nothing land can give us that is “intrinsically valuable,” because land cannot produce energy or ideas (unless I add solar panels or something). Land seems “intrinsically valuable” because we are always in a social order which values it, but, as has already been argued, this is “technically” not the case.
But don’t “fossil fuels” need a refinery “added to them” to turn them into energy? Yes, but then it’s the “fossil fuel” that isn’t intrinsically valuable, which it isn’t: what has value in of itself is energy. The same logic applies to food, air, and the like, but at that point the entities are “so close to being energy in itself” that it’s fair to speak about them as if they are, though “technically” that would be a mistake. It’s energy itself that is intrinsically valuable, not “the things” from which we can get energy. Similarly, ideas themselves are intrinsically valuable, not the brains which produce them. But even here, I want to make a technical distinction: both energy and ideas are actually “dialectically valuable” more so than “intrinsically valuable” (though I think this language can be used), because the value of one is contingent upon being realized by the other “into actuality.” If they are so “dialectically processed,” it’s “as if” they already had “intrinsic value” (“a flip moment”), but technically this is not the case: the “always” appeared with the dialectical use. Moving forward, when I use the language of “intrinsic value,” please know I intended that phrase to be understood in a dialectical context.
Still, I must admit that the fact that energy and ideas are “dialectically valuable” suggests they aren’t really intrinsically valuable to us, but I think our “island thought experiment” at least gives us reason to think that they are “the closest things to intrinsic value we can achieve,” and thus are “most fundamental.” At the same time, I do think energy is “inherently valuable” to the body side of us, while ideas are “inherently valuable” to the mind side of us: it’s just that since we are mind/bodies, we can’t say one is “inherently valuable” relative to “all of us.” “Dialectical value” is needed to address “all of us,” but perhaps that just means “dialectical value” is “higher” than “intrinsic value,” at least in our case, since we are dialectical beings.
Does all this mean that “leisure” must have a use to be valuable? Well, we do use “leisure”: we use the time free from commitments to read, for example. The question simply becomes “How do we use leisure?” — and that is a question to which we will all soon have to answer, perhaps to our existential terror.
¹¹All this brings us to the fascinating popularity of NFTs (as of 2021), a topic Anthony explores brilliantly. NFTs are an effort to help us see value past money. If a person comes up with idea x, NFTs provide me a way to put “skin in the game” on my evaluation that “x has value.” No, x hasn’t been created yet, so I might be investing far too early, but I also might be investing ahead of everyone else (suggesting I could make the highest return).
Basically, NFTs provoke the question, “What are people valuing?” This inquiry can help us think anew about value and its role in society, and ultimately NFTs are “minting” what is believed to be a “good use of energy.” “How much is that worth?” is what people usually ask, but NFTs invite us to ask, “How well was energy used?” Was energy channeled well into something beautiful, complex, good, intimate, and/or true? That’s up to us to decide, and no doubt this is not an easy question to answer. How we answer depends on our own “internal compass” and ability to judge “intrinsic value” (according to us) for ourselves. How do we do this? How do we make decisions according to our own system of internal valuation? With great effort and cultivation, but at least by asking “Was energy used well here?” we can help ourselves from getting caught up on questions of “monetary price” or “productivity” (as if they alone matter). NFTs invite us to see what actually is the source of value for human civilization, and it isn’t price. Value results from the dialectic of energy and ideas, and NFTs invite us to invest directly in that dialectic.
If we must determine “the ultimate storehouse of value,” it is the brain. Every animal and human possesses a working brain: it is what makes it possible for us to run on energy, and for us to generate ideas on how we should use and channel that energy. Brains are more concrete than gold or dollars, and yet strangely if we started using brains as currency, the brains would be useless. Brains create value because they exist in bodies, which is to say they exist in a concert of other variable and biological mechanics. Can we sell bodies? Well, when I work for someone, that is in essence what I am doing: to work is to sell ourselves. Perhaps it is worth it, but the point I’d like to focus on is that we are what we offer to people in exchange for money, pay, and so on. In a very real sense, we do use our brains/bodies as currency: we could say that we are all in a barter system. Nobody hires money to work for them (though they may “make money off of money” through investment); rather, people use money to hire people and to create profits.
Will robots replace bodies? That is a very good question: a day might be coming where humans don’t have to “sell themselves” for cash, but instead could send robots out to do work for them. The details of that society will be complex and difficult to navigate, but I think it’s easy to predict that there could be a significant increase of human leisure. Thus, we will come to “the problem of leisure.”
¹²As hopefully the paper “Demand” made clear on Keynes, ultimately what saves an economy from falling below the “demand event horizon” is not the State but the Artifex (especially as technological complexity arises), and the Artifex is “the creator class” who assures there is plentiful creativity in the society. The Artifex shapes the use of the society’s “mental system,” and that means it’s capacity to incubate intrinsic motivation relative to intrinsic values. To allude back to Keynesianism, if we want to keep a society from falling below the DEH, the name of the game is energy and creativity (suggesting the State should prioritize investing in both).
1. Without health, money easily doesn’t matter, and what is health but “the wellbeing” of our biological energy system?
2. Without money, we would have to resort to bartering, and though this would be inefficient, it would certainly be possible (and ultimately we are all arguably “bartering our bodies”). Thus, money cannot be “the real source of value,” even if it is incredibly useful in how we share and use value.
3. We could have all the natural resources in the world, but without ideas, we cannot use them. Thus, natural resources are not “real sources of value” alone, only resources plus ideas and the energy to realize those ideas.
4. There is no “unified theory of everything” in economics, just “a dialectical theory of value and energy.”
5. Economics as a “predictive science” is different from economics as a “philosophical inquiry.” “Economic policy” is different from “inquiries into human motivation and valuation,” and yet both are referred to as “economics.”
6. As highlighted by the wonderful telosbound, the philosopher Chad A. Haag explores brilliantly the relationship between fossil fuels and metaphysics, which I think can be applied to “sources of energy” in general. Haag explores how the metaphysical thinking of agricultural societies was “circular,” which stressed repetition and maintaining seasons, while under fossil fuels we stress “progress” and “a line slopping upward” (which resembles GDP, which corresponds strongly with “energy use”). Farming provides energy in the form of food, and oil is energy in the form of a fossil fuel — how we use energy shapes how we use our minds. Energy structures subjectivity.
The distinction between “shallow memes” and “deep memes” Haag proposes is genius, as is placing “phenomenological givenness” (“nonrationally”) as foundational for our metaphysical valuations and thinking. This brings to mind the work of Philip Rieff and “The Blank Canvas” by O.G. Rose, and personally Haag’s idea strikes me as more “solid” than say Jungian archetypes, which there is certainly truth too, but at the same time can feel like something is missing.
If “intrinsic value” is indeed ultimately a result of a dialectic between energy and creativity (Vaclav Smile and Deirdre McCloskey), Mr. Haag provides a line of thought that also makes that dialectic a source of metaphysical thinking — an extremely valuable move. Yes, as Jung highlights, no doubt masculinity and femininity beget archetypes, but why not energy if it is so fundamental to human civilization and human life? For Mr. Haag to have grasped this and articulated it so clearly is something for which I am very grateful.
7. Leisure is not a question of productivity so much as it is a question of “energy use.” In fact, leisure could be the necessary space in which we learn how to channel and use energy well. If this is the case, a Capitalism which doesn’t give us space for leisure in the name of maximizing productivity will eradicate the fundamentals which make productivity possible.
8. If we focus on how automation will destroy “blue collar jobs,” the people in college will focus on how they need to be cultured, and likely end up in leisure ill-prepared.
9. A thought that merely represents the world (an impression of a tree, for example) is not the same as a creative idea in terms of value. Yes, I use “ideas” loosely in this paper to refer to “creativity,” but there are differences that should be kept in mind.
10. “Memorization” has a tendency to replace “memory,” as Plato warned, and James Poulos notes that the fate of memory and imagination are strongly linked. There are no dreams without memory, but problematically Poulos warns that we are giving our lives over to inventions and technologies that rob us of the ability to “remember.” Is it possible for us to use “leisure well” in a world where we outsource our memory to computers? Perhaps if machines can dream.
11. The symbol of fundamental value is lightening — energy, a “striking idea” — which for Vico started civilization.
12. If we take seriously that we are “energy systems,” perhaps government gradually likes to replace “personal power” with “political power.”
13. The brain is a generator.
14. The work of Alexander Elung and Alexander Bard on Vector Theory is interesting to consider as a “dialect between the Vector of Physics and Vector Mind,” per se. The fact value is a result of an interaction of Vectors might suggest validity to Vector Theory.
15. The power of government is ours.
16. We are trained to consume not to power.
17. Instead of the “abundant scarcity” of creativity and energy, we have opted for the “assured mutual destruction” of debt (as discussed in “The Rationality of Invincibility and Self-Destruction” by O.G. Rose).
18. Energy is always moving, and today it is moving into power.
19. “Healthcare” is “energy care.”
20. The True Isn’t the Rational trilogy by O.G. Rose argues that humans are ontologically A/B versus A/A, which is to say a monistic “ontoepistemology” is insufficient. Perhaps because we have been biased by A/A, we have looked for theories of fundamental value which are similarly monistic versus dialectical? Ideas have consequences: we bring our metaphysics with us everywhere we look.
21. Economics is energetics.
22. It might sound like a downgrade to say bitcoin isn’t “the real storehouse of value,” but if all currency is just in the business of being a “secure storehouse of value,” bitcoin might win by a landslide.