The Great Simplification with Nate Hagens - 11 Discoveries That Changed My Worldview | Frankly 113

Episode Date: November 14, 2025

In this episode, Nate weaves personal reflections into an exploration of the human predicament, unpacking a series of chronological insights that have reshaped his worldview. What began years ago as an investigation into oil has morphed into a deep lifelong journey into the complex web of energy, psychology, evolution, and systems that drive today's society. By sharing stories and realizations from his own life, whether it's the debunking of Wall Street energy illusions or unpacking how sexual selection is often as important a behavioral driver as natural selection, Nate invites listeners to step back and see the human story through a much wider lens. This episode combines Nate's own evolution of understanding with the overarching narrative of The Great Simplification, speaking to what it means to be human in a dichotomous era of abundance and depletion, of numbness and awakening. It is perhaps more important than ever to be able to see our civilization through this wider perspective: not just as a disparate collection of individuals, but as a living – and learning – superorganism standing at the crossroads of deep time. How might our understanding of progress change if we saw energy, not money, as the true currency of life? What would it mean to live with full awareness of our interconnectedness with the world and systems around us? And could this moment in history mark the shedding of some of the evolutionary impulses that ensured our survival, in favor of a new kind of planetary wisdom? (Recorded November 10, 2025)   Show Notes and More Watch this video episode on YouTube   Want to learn the broad overview of The Great Simplification in 30 minutes? Watch our Animated Movie.   ---   Support The Institute for the Study of Energy and Our Future   Join our Substack newsletter   Join our Hylo channel and connect with other listeners  

Good morning. Have you ever taken a pause and considered the events and the learnings and the forks in the road in your life that have constructed and built your current worldview? Many of the followers of this platform have seen my online PowerPoint presentations about the human predicament. And today I'd like to have a different way of unpacking the human predicament, which is going through 10 first principle core learnings that I had over the last 30 years that formed my current worldview. Sure, there's lots of little things I've learned, like the Seneca effect, which is that things collapse much faster than they grow. And the rule of 70, you divide a growth rate into...

70 and the answer is the number of years it takes to double. Like at 10, it takes seven years to double. At one, it takes 70 years to double, et cetera. Lots of those little dynamics. But what I'd like to talk about today is really fundamental learnings that over time really developed and shaped my worldview. These are in no particular order. But I'm going to start kind of at the beginning where I started to shed my Gilligan's Island and Donkey Kong and Wall Street exterior and widen my boundary with how I viewed the world. Until my late 20s, I was pretty much a normal Midwest guy born into the upswing of what ended up being a straight line human economic growth of the 20th century. I liked girls and traveling and money and status.

and food, I still like food, and all the things. In New York City one year, my apartment was a 20,000 square foot loft where I handed out business cards to people on the street selectively to come to my weekend parties. It wasn't quite wolf on Wall Street, but perhaps coyote. One of my clients back in the day at Solomon Brothers started trading oil and in my own blessing and cursed sort of way. I endeavor to understand what it was we were actually buying and selling. And as I learned, I became more and more surprised and then obsessed with understanding oil and its role in our current and future world. And there were three main takeaways at that time,

which then led to many others over time. First is oil's power. A single barrel of oil contains 1,700 kilowatt hours worth of energy potential, which is the energy equivalent roughly five years of a human working, yet sells for less than a dinner in New York City. Oil and coal and natural gas, when combined with machines, function as an army of half a trillion human workers strong, which we effectively pay pennies for. So I learned that we confuse the price of energy with its value. Second is oil's finiteness. It took millions of years for the stock to form, and yet the way we're burning through it and our cultural stories and expectations around it imply it's more like a flow. And to whatever species on this planet might find it and learn how to access it, this was a one-time bank account from Earth's deep past.

It will be a carbon pulse with a maximum and a downslope. And then later, in later decades, I would spend thousands of hours trying to understand how much there was and how fast it was depleting. The answer is a lot. It's varying qualities. And on human timescales, it's depleting quite fast. Third was oil's externalized costs. None of the pollution or global heating or ecological damages from burning 100 million barrels. of oil per day appear in its market price. That seems obvious now, but was quite a realization for me

at the time. The prices we pay, the incentives, the institutions, the cultural expectations are based on the wrong long-term prices because we don't include depletion or pollution. And in our defense, neither do other species. So nearing 30 years ago now, the discovery of oil's role in the human economy ended up being the concept that caused the loss of my wide boundary virginity. Oil wasn't merely another commodity. It underpin nearly everything we label as progress. And what I learned in that deep dive in the 90s changed everything about how I see the world and also kind of changed my entire life from then on because I couldn't unsee it or not work on it. Energy primacy.

Once I began to understand oil, I started to see something larger, that it wasn't just about one fuel. It was about energy itself. Every economy, every technology, every civilization is at its core a physical process of transforming energy and materials into things that humans value, like food, shelter, comfort, status, and experiences. We tend to measure of all this in dollars, but underneath the money, every transaction is an energy transformation. It takes energy to mine the ore, to forge the metal, to build the car, to drive it, to repair it, to recycle it. Nothing happens without energy. And that realization showed me how deeply energy blind our culture is because we've become so accustomed to abundance that we've mistaken cheap and available energy. for a background condition in our world like air or gravity or sunrises.

But energy is not just another line item in our economy. It is the economy. Every dollar of GDP represents a physical transformation powered by energy somewhere. And once you see this, you can't unsee it. You start to notice how every story about growth or technology or progress is a under the surface really a story about energy, about how efficiently we can turn sunlight, fossil carbon and uranium into motion, heat or light, or some other services for humans. And how dependent all of it is on the quality and the flow of that energy and the cost. So I didn't

remotely understand this back on Wall Street. It took 15 years and a slog of a PhD to understand this. But now back to the Wall Street days. So in my mid-20s on Wall Street, I began noticing a peculiar paradox. The wealthiest clients, billionaires who were moving fortunes with a keystroke, often seemed anxious, restless, and generally unsatisfied. But I noticed that the back office clerks making 25, 30 grand a year were laughing. Swapping stories somehow lighter in spirit, even with long hours and little pay. I could give dozens of interesting examples. One client in his 80s had $800 million with us, laddered treasury notes and bonds and was

as cheerful and witty as one could be if his interest payments hadn't arrived in his account by noon on coupon day. He would call and berate me with swear words. I also discovered he lived in a tiny apartment, didn't own a car, didn't spend any of his $800 million. So over time, a pattern emerged. Wanting seemed a stronger force than having. And people with more actually wanted more, more.

And as a 28-year-old, learning about the world, witnessing this paradox. made quite a mark on me emotionally. And later I would understand that in ancestral times, wanting drove doing. And doing led to survival and reproduction. And those circuits were adaptive of them, but we've carried them into a world of material abundance. And so today, dopamine drives pursuit, not fulfillment. And our entire economy, maybe even our species, runs on that loop. And once I saw it, again, I couldn't stop seeing it. The realization was

uncomfortable. So much of modern life seemed built on perceived scarcity, the sense that we're missing something and we have to strive for more, even when surrounded by by any historical definition, plenty. And we've built a civilization addicted to the promise of more. But when more arrives, it doesn't bring contentment. It just raises the baseline for what enough will mean in the next period. And around that time, I also realized that rich or poor, we're all chasing the same thing, a particular mix of neurotransmitters. More money doesn't mean more serotonin. It merely buys a different path to the same temporary neurotransmitter chemical highs, which then retreat to baseline soon after. This was hammered home to me one time

when I went to Atlantic City and I was at a craps table and there was a man betting $5,000 a roll. And right next to him or a couple away from him was a guy betting $20 a roll. And they both cheered when they won and groaned when they lost. And the stakes and probably their life situation were worlds apart, but the biochemistry in the moment, or at least I realized this was probably identical. That just seemed weird to me. And something about that experience and dynamic and many others similar have stayed with me billions of minds across every social class and culture chasing the same fleeting signals through vastly different means. Supported by finite resources competing for emotional flows. The way of

wanting feels stronger than the having. It was around this time that you may not be surprised to hear that I pulled back from the usual New York scene. I was unsettled by these insights and was doing a lot of reflection, but I was also super curious. And I started reading a lot. In the early 2000s, I was reading more than one nonfiction book a week, sometimes two, plus working. Those were the days. I don't remotely read that much anymore. And eventually that curiosity pulled me out of finance altogether. I quit and I went back to get my PhD to study these questions more seriously.

One discovery in particular widened my boundaries of perception even further. One of the songs back then I liked was by Moby called We Are All Made of Stars. I heard this song like 20 times before I was like, What is he actually saying? What are those words mean? And of course, I researched it. We tend to think of life as something local, something that began here on Earth. But it turns out that the material, the raw material of our bodies was forged long before the Earth existed. And they have the elements that make us carbon, calcium, iron could only be created in the unimaginable heat and pressure of dying. suns. So billions of years later, those same elements cycle through us, combining, flowing, dispersing, and eventually returning again to the world when we die. And from that vantage, each of us is a

kind of intricate thermodynamic pattern. We're a process powered by sunlight, but built from the ashes of ancient stars somewhere in the distant universe. And that sunlight itself comes from from hydrogen turning into helium, the same fusion that once created the elements we're made of. So we are quite literally the children of stars, comprised of their remnants and animated by their light. So realizing I was recycled star matter in turn cracked open my sense of time and deep time. It was like putting on a new pair of glasses. it kind of became embodied.

I could get into a mental frame where I perceived every cell in my body as ancient, connected, and temporary. And I began to consider everything as part of an unbroken, continual story stretching back to the birth of the universe. We are all made of stars. And once you start thinking in deep time,

it's hard to see anything, including yourself as separate. start to realize that conscious life, you, me, all of us, is how the universe observes itself, which is kind of profound. And that realization opened a door that I've never closed. It led me straight into evolution, complexity, and the strange question of how self-aware stardust behaves in modern earth conditions. So as I got older, I noticed a pattern that I was, at least initially, until we would talk and I learned more, attracted to women with blue eyes.

A small thing, but then I researched why this might be. There's lots of reasons that are not relevant here. But what's relevant is in my research, I discovered that blue eyes in humans emerged only 8,000 years ago, likely from a single mutation they've pinpointed near the Black Sea. So for 99% of our species history, no human had blue eyes. And then suddenly this oddity spread to what is today around 10% of the global population, not because it conferred any survival advantages, but because it caught attention, which then led to other things.

So blue eyes are an epigamic trait, a feature selected over time by attraction, not by adaptation. So like a peacock's wings or a bird song or the coloration of guppies or many fish. And that revelation cracked open the bigger gateway to evolved psychology of humans. All of our current physical and mental structures are directly or indirectly a product, either of what worked or what was preferred in the past with, of course, a huge role for the environment at the time. So we're not born as blank slates, but are following evolutionary scripts of mating choice and status games and social learnings. These are all deeply conserved and often invisible and often irrational, but often predictable. So these evolve behavioral

tendencies ultimately explain a great deal of the current human and planetary predicament. Social status, addiction from supernormal stimuli, power and loss aversion, and collective action, tragedy of the commons dynamics, steep discount rates, and cognitive bias is the kitchen sink. It's all a product of our behavior. So much of what we desire, value, and even Even fear has deep roots in biology and history. So what feels like our own free will is often a whisper or a quiet nudge from our great grand-sisters. But as I eventually came to realize with some training and discipline and a lot of time is we can

sometimes ignore those nudges and whispers, which is another reason I'm doing this work. So the next learning was so central to my worldview that I ended up writing my PhD thesis on it, the concept of net energy. Every living system depends on getting more energy than it spends. Longtime viewers of this channel are probably tired of me talking about a cheetah, but I'm used to talking about that example. A cheetah has to gain more calories from the gazelle than it burned in the chase, plus all the chases that ended in nothing. And the difference between what it gets and what it spends is called

net energy. And that surplus left over is what allows it to rest, heal, and reproduce. This is the real driver of life and evolution. Human societies work the same way. We use energy to get energy. We drill wells and mining lithium and building solar panels and maintaining grids. And what's left over after all those costs is the energy that actually runs civilization. That surplus builds cities, grows food, powers hospitals and libraries and football stadiums and drives everything we call the economy. For centuries, the energy cost as a percentage of total energy in society kept falling. And that decline enabled civilization's massive expansion. Well, that decline coupled with

the scale of more energy. But in the 21st century, energy's cost share began to rise again. According to research by my friend Carrie King, energy's cost share of GDP hit a 700-year low around 1999 at around 4%. We spent 4% of energy to find refined, refined. deliver all the rest to society before climbing again. Today it's hard to exactly know, but it's over 10% and headed towards 15% as the easier resources have now been used and exhausted. So in effect more and more of society's energy and materials are now spent just to maintain the system that extracts them. So the economic equivalent of a cheetah is having to run further and more times

to catch smaller gazelles. I used to think declining net energy meant declining growth, but it doesn't because GDP is 99% correlated with energy use. But energy use is gross energy use. So as we direct more and more of our total energy and materials into getting energy, yes, AI, I'm looking at you,

that's actually good for GDP. But who consumes the energy and at what cost those are different questions. So energy is the currency of life, and net energy is the spending money, what's left after the bills are paid. And behind the scenes today, those bills are getting bigger. So understanding energy made me revisit how I thought about money.

It turns out that the fractional reserve banking model I was taught in business school was wrong. I'd always believe banks lent out existing funds that money was some fixed pool growing slowly through wealth, accumulation, innovation, and productivity. That's not how it works. Banks don't lend out old money. They create new money. Every loan is new purchasing power brought into existence by the promise of future repayment with credit worthy customers. The system expands not because of stored wealth, but because of people's confidence in future growth. So credit expansion that makes complete sense on corporate and government account ledgers assumes the future will be bigger than the present.

And there are some problems with this. The first problem is when we create more money, we don't create more stuff. The moment a billion dollars in new credit appears, we have the same amount, exact same amount of soil, forests, oil, copper, water, dolphins, and orangutans, as we did before. Our financial system multiplies abstractions, but the physical world underneath it doesn't scale at the same time or at the same way. The second problem is that when a loan is created, the principle comes into existence, but the interest does not. The interest has to be paid from growth in the system sometime in the future. So the very structure of how modern money is created as a built-in

growth imperative for the system. So our entire economy is tethered to trust and recent productivity, not to physics, not to thermodynamics. And that realization broke a kind of a spell in my early Wall Street, well, my late Wall Street days, my early life days, actually it shattered a spell. It like changed how I looked at everything. I started to see money differently. I saw money itself, the digits in the bank accounts around the world and the pieces of linen that we have in our wallets and purses as claims on real things, claims on real capital. And I saw financial crises less as accidents, but more as physics periodically catching up to finance. Because underneath the numbers, the global economy runs on jewels, atoms, and functioning ecosystems, lest I forget.

Not credit ledgers and spreadsheets. So every time that we spend dollars to buy something, that's something required. an energy transformation. Every good in the global economy we pay money for was created somewhere with a small fire on the planet. Every dollar of debt in the global system will one day have to be made good with some form of energy when it's repaid and spent. So the deep dive into energy and money brought me to technology, a subject I continue to roll around in my head and try to understand today and technology certainly is moving ahead at light speed. I used to believe technology created wealth, and it took me decades to realize technology

mostly just accelerates access to it. Real wealth doesn't come from the stock market. It comes from the sun and soil and water and living systems and natural resource accounts. the foundation that make everything else possible. Technology doesn't create that wealth. It functions more like a straw to access it, and the straw gets bigger and wider over time, but in the short run, it helps us turn stored wealth into income, faster. I was thinking about this this weekend,

cutting and chopping firewood, which I'm way behind for this winter, what I can accomplish with a chainsaw, a splitter, and a utility vehicle and some gasoline and oil, not even that much, massively increases my own ability to extract wood from the land. And think about various versions of this times $8 billion. We've come a long way from stone tools. So this all landed me on what some referred to as the fourth law of thermodynamics, which is the maximum power principle. And it explains why in nature and in economy, systems and

that maximize energy throughput, that capture and use energy per unit time, the fastest, tend to outcompete others. Technology is how we do that. It lets us extract energy, materials, and value from the biosphere faster, which has historically been adaptive for creatures, for individual humans, and for socioeconomic systems. But that advantage carries a trap, because when we make a process more efficient, it doesn't necessarily save energy, it often increases total consumption. That's the rebound effect or the backfire effect or Jevin's paradox in its various forms. Cheaper, faster, more efficient systems

expand total use because we can afford to do more of them. The world calls this all progress, but from a long term or even an intermediate term perspective, it usually just means we're burning through our low entropy stocks faster. Technology does extend our reach, but as we're learning, it simultaneously deepens our dependency. Okay, back to behavior of humans again. The realization about endless wanting led me to a deeper question. Are humans fundamentally selfish or cooperative? And the answer is, of course, both. And multi-level selection theory helped me see why that evolution doesn't just act on individuals. It also acts on groups. Groups that cooperate effectively tend to out-compete those that don't. And it's not only groups. The same theory,

the same selection process applies at other levels, viruses or microbiomes that benefit their hosts are more likely to persist. Their selection happening at multiple levels, not just the level of the individual. One of my PhD advisors, Charles Goodnight, who unfortunately has passed away, was an evolutionary biologist studying multi-level selection in beetles. I remember long conversations with him in his beetle lab about animal behavior, and it turns out that selfishness is a very narrow driver of evolution. One experiment made this vivid in my mind that stayed with me. I've shared it on this channel several different times. A colleague of Charles oversaw a study to increase egg production by selecting the most productive chicken hens from a number of groups.

But unexpectedly over time, doing this, it turns out that the top egg layers were also super aggressive chickens. And when you selected for them and put them in a new cage, they pecked and killed each other. So the total egg output per cage actually fell. But when the people in the experiment selected the most productive cages, the groups of chickens instead, cooperation flourished and overall egg production rose significantly. This was a small experiment, but that insight reshaped how I see human behavior and human systems. Because our entire civilization, runs on this same tension. Competition drives innovation, but cooperation sustains it. So the selfish gene story that I'd grown up with wasn't wrong per se, but it was really incomplete.

And the real story is about balance between the individual and the collective, between winning and belonging. And in our culture, we've spent decades or longer, glorifying, winning, and pretty much neglecting belonging. I have always cared about animals. When I was little, I would watch Mutual of Omaha's Wild Kingdom, and I would memorize the names, platypus, lion, mongoose, Ibex. And my mom took me to dozens of zoos around the country because my parents traveled a lot when I was young.

I knew a lot about individual animals. I didn't yet have an ecological wide boundary context. And when I began learning about the natural world as a system, the flows of energy and matter that connect everything and population ecology and the details of the web of life and how we're related to every other living being on Earth, at some point I came across a figure that was a gut punch at the time and still haunts me today. in our livestock, today, our cows, pigs, goats, sheep outweigh all wild land mammals by roughly 80 to 1. And 10,000 years ago, before agriculture, that ratio was reversed. Wild

mammals outweighed us in our domestics by about 40 to 1. So that's a 3,000-fold swing in biomass composition and what amounts to an evolutionary eye blink. Yeah, population growth explains part of it, but the deeper story is one of planetary reallocation. The living fabric of Earth reorganized around human needs. So we now direct around 30 to 40 percent of the net primary productivity of the sunlight hitting Earth, all the photosynthesis happening on this planet towards human purposes. And that's on top of all the ancient productivity we burn in the form of coal, gas, and oil. We've become the ecosystem. Our food chains, our industries, our economies, consuming the wild world and remaking it in our image.

We're taking more than our share. That number hit me like a punch to the stomach when I first heard it and even telling the story here, I feel the echoes of that right now. It's the most tangible measure I know of our dominion on this planet. And it became one of the guideposts that pulled me deeper into this work because it's it's so unsettling. Because once you realize humanity is the ecosystem, the next question is, what kind of organism have we actually become? Which leads me to the final discovery here in my list of 10 first principles. The final discovery was recent and actually ongoing and both really depressing, but also, especially

recently, hopeful. I recognize that the humans are bad narrative in environmental and ecological circles had an important asterisk. Humanity as a whole functions very different than humans as individuals. Most people are decent. In all countries around the world, we always have been kind, cooperative, generous, at least within our own circles and in local contexts. But at scale, something changes.

We create emergent systems, media and politics, and especially markets that begin to take on a life of their own, especially in a hyper-connected world with ample relative to the past energy surplus. We self-organize as families, as small businesses, corporations, and ultimately as nation-states to maximize earnings and salaries and profits, which are all tethered to energy, material throughput, and ecological impact. And over time, we behave less like collections of individual people and more like a mindless, unthinking economic superorganism, driven by its own need for energy to continue growth.

It's this system that has emerged with its own metabolism approaching today close to 20 trillion watts of energy demand continuously. Within these systems, people with what psychologists call dark triad traits, narcissism, Machiavellianism, and psychopathy often rise to the top, not because they're chosen, not because they're evil or more capable, but because the system, our current system, rewards short-term power over long-term balance. And so at key nodes of the system, the metabolism and the structures are thus reinforced. And through what Donald Campbell called downward causation, those incentives ripple outward, shaping the behavior of everyone below, us.

The system becomes the organism and we are its cells. It's unsettling to realize that our collective intelligence can act in ways no one would, or very, very few people would consciously choose. Yet this insight also holds a seed of hope to me. Maybe this is what an evolutionary transition looks like at a species scale. Maybe it's what it would have to look like. The painful process of becoming aware of ourselves as a planetary force. And if we can integrate that awareness, maybe we can grow into something wiser.

It starts with the self-aware cells, I think. So each of these historic realizations on my journey dismantled a layer of my own naivete of myself and our times. Yet beneath the disillusionment, something else grew in me, a sense that our species may be approaching a kind of right of passage, not economically, but about who we are in our relationship to the broader world. We have learned and accumulated and acquired the powers of gods, but not yet the wisdom of what Bill Plotkin would say. what call ecological adults, to see ourselves as stardust, as animals, as energy systems and social organisms is to begin to remember what we are, not separate from nature, but expressions

of it. And the hope is not escaping these truths, but in integrating them, entering finally into conscious membership in the long and, I hope, continuing story of life on Earth. And at times I feel somewhat powerless against the metabolism of the superorganism and its power structures. But I'm human and I'm still learning and discovering and with this channel sharing. Next week, I will attempt to address solutions and responses to the human predicament. Thank you for watching and listening. See you soon.