Les Jones

The De-population Problem

Foreign Affairs examines declining birthrates around the world. It's not just Europe, Japan, and the U.S., anymore. Birthrates have fallen dramatically in Iran and Mexico. Puerto Rico's birthrate is now below replacement levels. Populations are aging everywhere, with potentially ruinous consequences for pension and healthcare systems.

Some biologists now speculate that modern humans have created an environment in which the "fittest," or most successful, individuals are those who have few, if any, children. As more and more people find themselves living under urban conditions in which children no longer provide economic benefit to their parents, but rather are costly impediments to material success, people who are well adapted to this new environment will tend not to reproduce themselves. And many others who are not so successful will imitate them.

So where will the children of the future come from? The answer may be from people who are at odds with the modern environment -- either those who don't understand the new rules of the game, which make large families an economic and social liability, or those who, out of religious or chauvinistic conviction, reject the game altogether.

In a biological system, fitness is defined by reproducing. But certainly it's financially advantageous today to not have children.

In the United States, the direct cost of raising a middle-class child born this year through age 18, according to the Department of Agriculture, exceeds $200,000 -- not including college. And the cost in forgone wages can easily exceed $1 million, even for families with modest earning power. Meanwhile, although Social Security and private pension plans depend critically on the human capital created by parents, they offer the same benefits, and often more, to those who avoid the burdens of raising a family.

Mark Steyn on European Demographics

His latest. "The hyper-rationalism of post-Christian Europe turns out to be wholly irrational: what's the point of creating a secular utopia if it's only for one generation?"

Democrats Losing the Family Vote

If you're a Democrat, this should worry you. "John Kerry won the 16 states with the lowest birth rates; George W Bush took 25 of the 26 states with the highest." Demographics are destiny. If Democrats are having fewer kids than Republicans, how do you suppose future elections are going to turn out?

Jim Miller comments on recent reports noting the lack of children in America's biggest cities. Miller observes that Democrats govern almost all of those cities, and cites some kid-unfriendly policies that might be driving out familes.

Australia's Incentives for Having Babies Pays Off

Australia had more babies born than they've had in 14 years, thanks to government incentives for having children. From AP news. It won't be long before European countries will have to follow Australia's lead to reverse their population declines.

Mark Steyn's Prediction for European Immigration

His latest.

By 2010, a smart energetic Chinaman or Indian will be able to write his own ticket anywhere he wants. How attractive will the prospect of moving to the European Union and supporting a population of geriatric ingrate Continentals be? Not just compared with working in America or Australia but with the economic opportunities in his own country?

Here�s a prediction: Europe�s dependence on immigration will in the end prove far more catastrophic than America�s dependence on oil. The immigrants will run out long before the oil does. And the demographic disaster will be exacerbated by a continent-wide version of �white flight� � the abandonment of socially dysfunctional, economically moribund American cities in the Seventies by a frustrated middle class.

Japan's Population to Decline 14% by 2050

Japan's population will shrink from 127 million in 2004 to 109 million in 2050, according to a new United Nations study.

Why 2008 May be Hillary's Best Chance

From Mark Steyn.

But, if I had to be a bit more mathematical about it, I�d look at it this way. If the Democrats ever want to take back the White House, 2008 is their best shot. After the 2010 census, the electoral college apportionment for the 2012 Presidential campaign will reflect the population shifts to the south and west � ie, growing Republican �red� states will get more votes and declining Democrat �blue� states will have fewer. The trouble with being a party that promotes abortion as a sacrament is that after a generation or two it catches up with you: in 2004, the 16 states with the lowest fertility rate voted for John Kerry; 25 of the 26 with the highest fertility rate voted for George W Bush. In the long run, a lot of Democratic turf is looking as demographically barren as the European Union. And, even discounting the long-term prognosis, right now more red states are trending blue than vice-versa. So, if the Dems don�t win in three years� time, things are only going to get worse. In 2008, they need a candidate who can hold all the territory John Kerry won plus flip Ohio or Florida into the Democratic column.

Read the whole thing if you're following Hillary's chances for 2008, or for that matter, Jeb's:

The Republicans do have a popular governor of a large state, but his name's Jeb Bush, and even loyal Baathists might have drawn the line at Saddam being succeeded by both Uday and Qusay. On the other hand, if Jeb wants to avoid being penalised by American distaste for dynastic succession, the 43rd President's brother running against the 42nd President's wife may be the most favourable conditions he'll ever get.

Japanese Population Shrinks for First Time

From Yahoo News:

Japan's population stood at 127,687,000 as of October 2004. The health ministry said births were set to fall by 44,000 to 1,067,000 this year, with deaths going up 48,000 to 1,077,000 year-on-year.

This year's decrease is tiny, but the population is expected to halve by 2100. Japan's a crowded country, and a smaller population might be better in some ways, but Japan's social welfare, healthcare, and pension system is going to be challenged by even small downturns. There's also no telling what will happen to real estate in a country that loses half its population, and what that will do to the economy.

State Population Changes

Michael Barone looks at state population changes and what they mean for upcoming elections. Average growth was 5.3 percent. In general, the only Northeast states that registered above-average gains were the economically liberal states of Delaware and New Hampshire. All of the Western states registered above-average growth except for Montana and Wyoming. Louisiana registered the least growth (1.2%) even before Hurricane Katrina. On the political picture:

These numbers are mostly good news for Republicans. The average population growth in the 31 states carried by George W. Bush was 5.6 percent. The average population growth in the 19 states and the District of Columbia carried by John Kerry was 3.9 percent.

And there's this:

For internal migration, the two big losers were New York (1,001,100) and, perhaps surprisingly to many readers but in line with the 1990s trend, California (664,460). New York's internal population loss was almost precisely the same as Florida's internal migration gain (1,057,619), while California's internal migration loss was almost precisely the same as the internal migration gain of Arizona and Nevada (679,105). That's not to say that all these internal migrants went to Florida, Arizona, and Nevada, but you get the idea.

There's an official census in 2010 that will almost certaintly re-apportion Congressional representation and electoral votes in favor of red states. If the Democrats have a plan to counteract these ingrained population trends they need to get cracking on it before they go the way of the Shakers (and that Wikipedia link puts the best possible spin on a religious movement that went extinct because of a belief in celibacy, a lack of personal property rights, and the dissolution of the family unit).

More Mark Steyn on Demographics and Destiny

Mark Steyn in The Australian:

Demography doesn't explain everything but it accounts for a good 90 per cent. The "who" is the best indicator of the what-where-when-and-why. Go on, pick a subject. Will Japan's economy return to the heady days of the 1980s when US businesses cowered in terror? Answer: No. Japan is exactly the same as it was in its heyday except for one fact: it stopped breeding and its population aged. Will China be the hyperpower of the 21st century? Answer: No. Its population will get old before it gets rich.

Check back with me in a century and we'll see who's right on that one. But here's one we know the answer to: Why is this newspaper published in the language of a tiny island on the other side of the earth? Why does Australia have an English Queen, English common law, English institutions? Because England was the first nation to conquer infant mortality.

By 1820 medical progress had so transformed British life that half the population was under the age of 15. Britain had the manpower to take, hold, settle and administer huge chunks of real estate around the planet. Had, say, China or Russia been first to overcome childhood mortality, the modern world would be very different.

What country today has half of its population under the age of 15? Italy has 14 per cent, the UK 18 per cent, Australia 20 per cent - and Saudi Arabia has 39 per cent, Pakistan 40 per cent and Yemen 47 per cent. Little Yemen, like little Britain 200 years ago, will send its surplus youth around the world - one way or another.

And if you want to know what affect that's going to have on the world in the very near future, there's this:

Instead of a melting pot, there's conversion: A Scot can marry a Greek or a Botswanan, but when a Scot marries a Yemeni it's because the former has become a Muslim. In defiance of normal immigration patterns, the host country winds up assimilating with Islam: French municipal swimming baths introduce non-mixed bathing sessions; a Canadian Government report recommends the legalisation of polygamy; Seville removes King Ferdinand III as patron of the annual fiesta because he played too, um, prominent a role in taking back Spain from the Moors.

If you want the reality of Europe in a nutshell, walk into a supermarket belonging to the French chain Carrefour. You'll be greeted by a notice in Arabic: "Dear Clients, We express solidarity with the Islamic and Egyptian community. Carrefour doesn't carry Danish products." It's strictly business: they have three Danish customers and a gazillion Muslim ones. Retail sales-wise, they know which way their bread's buttered and it isn't with Lurpak.

In the '70s and '80, Muslims had children - those self-detonating Islamists in London and Gaza and Bali are a literal baby boom - while westerners took all those silly books about overpopulation seriously. A people that won't multiply can't go forth or go anywhere. Those who do will shape the world we live in.

Call me a bigot, but I prefer Western Christian liberal culture to Arabic Islamic culture and Sharia, and I'm not even a Christian. Whether you're a U.S conservative or a U.S. liberal, it's impossible to treat the potential ascendency of Arabic Islamic culture as anything but a threat to our culture and way of life.

Philip Longman's "The Return of Patriarchy"

(Before bursting a blood vessel, be sure to read Longman's definition of patriarchy, which doesn't include keeping women in garters, panty hose, or chastity belts.)

From Foreign Policy via Instapundit.

Meanwhile, single-child families are prone to extinction. A single child replaces one of his or her parents, but not both. Nor do single-child families contribute much to future population. The 17.4 percent of baby boomer women who had only one child account for a mere 7.8 percent of children born in the next generation. By contrast, nearly a quarter of the children of baby boomers descend from the mere 11 percent of baby boomer women who had four or more children. These circumstances are leading to the emergence of a new society whose members will disproportionately be descended from parents who rejected the social tendencies that once made childlessness and small families the norm. These values include an adherence to traditional, patriarchal religion, and a strong identification with one’s own folk or nation.

This dynamic helps explain, for example, the gradual drift of American culture away from secular individualism and toward religious fundamentalism. Among states that voted for President George W. Bush in 2004, fertility rates are 12 percent higher than in states that voted for Sen. John Kerry. It may also help to explain the increasing popular resistance among rank-and-file Europeans to such crown jewels of secular liberalism as the European Union. It turns out that Europeans who are most likely to identify themselves as “world citizens” are also those least likely to have children.

...

Societies that are today the most secular and the most generous with their underfunded welfare states will be the most prone to religious revivals and a rebirth of the patriarchal family. The absolute population of Europe and Japan may fall dramatically, but the remaining population will, by a process similar to survival of the fittest, be adapted to a new environment in which no one can rely on government to replace the family, and in which a patriarchal God commands family members to suppress their individualism and submit to father.

The current reliance on government won't last forever. Government can provide a safety net, but it can't replace a family. A case worker isn't kin.

It will be interesting to see if Western liberals who easily grasp natural selection in the context of Darwinian evolution will be able to grasp the identical concept when applied to culture. It's true, of course, that culture pre-ordains destiny to a much lesser degree than genetics, but it's hard to argue that cultures and sub-cultures that are dying demographically will prevail culturally.

Leaving California

Meathead Economics, from the Wall Street Journal.

It takes hard work to drive anyone away from California's sunshine and scenic vistas, but politicians in Sacramento have been up to the task.

The latest Census Bureau data indicate that, in 2005, 239,416 more native-born Americans left the state than moved in. California is also on pace to lose domestic population (not counting immigrants) this year. The outmigration is such that the cost to rent a U-Haul trailer to move from Los Angeles to Boise, Idaho, is $2,090--or some eight times more than the cost of moving in the opposite direction.

...

This isn't [Rob Renier's] first foray into confiscatory tax politics. Last year he sponsored a ballot initiative narrowly approved by voters that imposed a percentage-point income-tax surcharge (to the current 10.3%) to pay for government mental-health subsidies. And in the late 1990s he helped to pass an initiative to raise the state's tobacco tax by 50 cents a pack to pay for children's health care.

All of this has contributed to the trend of wealthy taxpayers disappearing from the state. State finance office data indicate that the number of Californians reporting million-dollar incomes fell to 25,000 in 2003 from 44,000 in 2000. That decline has cost the state $9 billion a year in uncollected tax revenues.

California's generous social programs depend on a strong population, a rich population, and a strong property tax base. A relatively small downturn in population and housing demand could cause a large correction in real estate prices.

When things were good, California was tempted into creating big social programs. Now that the economy is cooling down, they could wind up in the same boat as GM and Delphi - past their earnings peak and paying obilgations made during the good years.

LATER: Tam warns other states to be on the lookout for the type of California refuge who flees the state and then tries to Californize their new home: "Some folks may be leaving California looking for freedom, but [some] guys are just leaving to find more comfortable chains that don't make them look fat."

Minnesota May Lose Electoral Vote, Congressional Seat

Minnesota may lose one electoral vote and one Congressional seat in the 2010 census. From the Duluth News Tribune.

"As the Baby Boomers get older, they're going where it's warmer," said Dean Barkley, a political independent who was Gov. Jesse Ventura's planning director after the 2000 census and then briefly a U.S. senator. "It's not a matter of if (Minnesota loses a seat in Congress), it's a matter of when. It would be nice to dodge the bullet one more time, but eventually we're going to lose a seat in Congress."

Minnesota was the only Great Lakes state that didn't lose a seat after the 2000 census. It has had eight House seats since 1960, when it dropped from nine. While Polidata puts the state's population growth at 7.9 percent over the next five years -- higher than any of its Upper Midwest neighbors -- it is still below the national growth rate of 11.2 percent.

Pensions and Population Declines

Jim Miller points to University of Minnesota Research on the relationship between government pension systems and fertility declines.

Drawing from surveys and other data collected by previous researchers in the United States and Europe, including a massive cross-cultural study of 104 countries conducted in 1997, they were able to identify the factors that most directly influenced fertility rates. They also charted the growth of the old-age pension systems in each country to determine what impact, if any, they had on fertility. The development of government pension programs accounted for between half and two-thirds of the decline in fertility rates in the United States and developed countries over the last 70 years, they concluded in a new working paper published by the National Bureau of Economic Research.

It's having an effect on the U.S., too, but somewhat less so since our pension systems (Social Security and Medicare) are modest compared to Japan and European countries.

A Different Look at Demographics

The Scratching Post looks at the demographic question in terms of favorable population demographics and per capita wealth, and finds the strong horses for the near future (figures are per capita income):

1. USA - $41,800
2. Ireland* - $34,100
3. Australia - $32,000
4. France - $29,900
5. Argentina - $13,600
6. South Africa - $11,900
7. Mexico - $10,000
8. Brazil - $8,500
9. Iran - $8,100

It's a quickie analysis and you can certainly argue with his methodology, but it's an interesting list. I didn't realize Iran was doing so well.

Many people still don't know about Ireland's economic miracle of the last quarter century. By embracing free market principles, lower taxes, deregulation, and smaller government, they've become an economic powerhouse - the Celtic Tiger.

See also:
- Australia's Incentives for Having Babies Pays Off
- "Dingoes Stole Me Babies!"
- Big-Spending Republicans Can Learn from Ireland’s Reforms (The Future of Freedom Foundation)

Germany Considers Pension Cuts for the Childless

Politicians Discuss Pension Cuts for Childless Germans:

New statistics confirming the declining birth rate have sent Germany in to a state of panic, amid a growing consensus that pensions should be increased for people with children and reduced for those without.

"People without children should either receive a reduced pension or pay more into pension schemes," said Norbert Geis from the CSU.

Johann Eekhoff, director of the Cologne institute for Economic Policy said a reform of the pension system was long overdue.

"People without children should never have been admitted into pension schemes because these only work when they are financed by subsequent generations," he said in an interview with mass-circulation Bild newspaper. "Their pensions should be cut by 50 percent."

As Mark Steyn likes to say, any country that promotes a central welfare state is going to have to have pro-natalist policies, or the welfare state won't survive more than a couple generations. The catch is that the welfare state seems strongly correlated with lower birth rates, potentially creating an unsustainable system. What's a socialist to do?

To quote another Steynism, "The design flaw of the secular social-democratic state is that it requires a religious-society birth rate to sustain it. Post-Christian hyper-rationalism is, in the objective sense, a lot less rational than Catholicism or Mormonism."

Chinese Labor Becoming More Expensive

From the NY Times via New Editor:

Experts say the shortages are arising primarily because China's economy is sizzling hot, tax cuts have helped keep people working on farms, and factories are continuing to expand even as the number of young Chinese starts to level off.

Prosperity is also moving inland, and workers who might earlier have migrated elsewhere are staying closer to home.

As the New Editor points out, the Times seems blasé that tax decreases can stimulate other country's economies.

Exodus from Large Cities, CA, IL, MA, NY

A new census report shows population losses in most large urban areas, and overall losses for California and most Northeastern states. The people fleeing those areas are of all ethnic makeups, leading some people to say this isn't white flight but middle class flight.

The states gaining population are mostly in the South in the non-coastal Western states. The large cities that gained were Riverside, CA, Phoenix, AZ, Tampa-St. Petersburg, FL, Atlanta and Dallas-Fort Worth.

Those same emigrants are also moving to states with fewer gun control laws, as Uncle notes, but as his commentors suggest I think that's a coincidence. The states that are more economically free also happen to have more second amendment freedom.

More on Domestic Migration Trends

Willisms graphs the data from the Census Bureau study from last week. Summary: blue states losing population, red states gaining population.

Putin Offers Money for Russian Families to Have Babies

From WaPo:

President Vladimir Putin offered couples cash to have more children to halt a dramatic decline in population and called for a stronger army in a key speech on Wednesday in which he shrugged off sharp attacks by Washington.

Putin, defying predictions he would focus on foreign policy, zeroed in on Russia's dwindling population -- an issue with huge implications for the economy -- which is falling by 700,000 people every year.

Glenn Reynolds Article on the Decline of Families

Great article on the reasons for the decline in families, and the diminishing financial and social rewards of parenting. I loved this bit about the minivan.

People in the suburbs buy SUVs instead of minivans not because they need the four-wheel-drive capabilities, but because the SUVs lack the minivan's close association with low-prestige activities like parenting, and instead provide the aura of high-prestige activities like whitewater kayaking. Why should kayaking be more prestigious than parenting? Because parenting isn't prestigious in our society. If it were, childless people would drive minivans just to partake of the aura.

How Can Housing Demand Increase as Population Shrinks?

Jane Galt and Winterspeak speculate on reasons why the demand for housing in MA and Boston can increase while the population decreases. An earlier study found the same thing happened in metro New York. That study found that the population loss was mostly due to middle class flight. Presumably the larger middle class families were being replaced with smaller upper class families or older, empty nest families.

Sweden's Suicide Note?

Reflecting Light:

Fjordman at Gates of Vienna says he has confirmed from independent sources that Jens Orback, Democracy Minister (!) in the Swedish government, said during a radio debate: “We must be open and tolerant towards Islam and Muslims because when we become a minority, they will be so towards us.”

In other words, a government minister takes it as foreordained that Swedes will become a minority in Sweden, and Muslims the majority. To him, it's just a fact of life. It's not as if the indigenous population could do anything about it, or should want to do anything about it.

Orback pins his hope on a Muslim majority being open and tolerant, just like they are in … in … help him out here.

It's one more ominous confirmation that much of "old Europe" is sick unto death. It doesn't want to preserve its national identities, its ethnic majorities, its traditional cultures, its system of government (except for the welfare state). God is dead; tolerance is God. If Sweden is to become part of Dar Al-Islam, well, who are Swedes to say that their way of life is better? It might cause offense.

Better to simply write the suicide note and make sure that the beneficiary is clearly spelled out in the will.

The Liberal Fertility Gap

Arthur Brooks in the WSJ's OpinionJournal:

Simply put, liberals have a big baby problem: They're not having enough of them, they haven't for a long time, and their pool of potential new voters is suffering as a result. According to the 2004 General Social Survey, if you picked 100 unrelated politically liberal adults at random, you would find that they had, between them, 147 children. If you picked 100 conservatives, you would find 208 kids. That's a "fertility gap" of 41%. Given that about 80% of people with an identifiable party preference grow up to vote the same way as their parents, this gap translates into lots more little Republicans than little Democrats to vote in future elections. Over the past 30 years this gap has not been below 20%--explaining, to a large extent, the current ineffectiveness of liberal youth voter campaigns today.

Alarmingly for the Democrats, the gap is widening at a bit more than half a percentage point per year, meaning that today's problem is nothing compared to what the future will most likely hold. Consider future presidential elections in a swing state (like Ohio), and assume that the current patterns in fertility continue. A state that was split 50-50 between left and right in 2004 will tilt right by 2012, 54% to 46%. By 2020, it will be certifiably right-wing, 59% to 41%. A state that is currently 55-45 in favor of liberals (like California) will be 54-46 in favor of conservatives by 2020--and all for no other reason than babies.

The fertility gap doesn't budge when we correct for factors like age, income, education, sex, race--or even religion. Indeed, if a conservative and a liberal are identical in all these ways, the liberal will still be 19 percentage points more likely to be childless than the conservative.

On a related note: "John Kerry won the 16 states with the lowest birth rates; George W Bush took 25 of the 26 states with the highest."

Record German Emigration

From Bloomberg via Instapundit:

Koerber is one of 145,000 Germans who fled the fatherland last year amid record postwar unemployment, pushing emigration to its highest level since 1954, Federal Statistics Office figures show. Last year was also the first since the late 1960s that emigrants outnumbered Germans returning home from living abroad, the statistics office said.

Taking into account gross pay, taxes, insurance and the cost of living, doctors make more money in Switzerland, said Matthias Dettmer, 31, an assistant pathologist in Zurich from the southern German city of Tuebingen. He makes more than double his former colleagues in Germany, who earn what he calls a ``cleaner's pay.''

``I don't know yet whether I'll ever go back,'' said Dettmer. ``Under the prevailing conditions, it would be a hard sell to convince me that it's better in Germany.'' Koerber, who's striving for permanent Canadian residency, said there's little point trying to persuade him to return home. ``I'll never come back,'' he said. ``Guaranteed.''

Germany has one of the world's lowest birthrates, ranking 223rd out of 225 countries. Adding emigration on top of that is going to devestate their culture and the tax base needed to sustain their social programs.

"The Decline of Motherhood"

From Margret Kopala in the Ottawa Citizen:

For the generation that's brought Canada's fertility rate to below replacement levels, such idylls can only become increasingly rare. With 1.5 children per couple, our best hope is a quiet death in a clean facility where the immigrant workers speak our language. And that's only the human face of demographic decline. The economic face is hardly more appealing: unfilled labour markets, reduced GDP and no tax revenues to pay for health care -- to name a few.

Canada isn't the only country in this predicament. According to America Alone, Mark Steyn's self-described and penetrating rant on "demography, Islam and civilizational exhaustion," the developed world has gone from 30 per cent to 20 per cent of global population. Greece has 1.3 births per couple -- the "lowest low" from which no society has ever recovered; Russia, where 60 per cent of pregnancies are terminated, has the fastest-growing rate of HIV in the world and, by 2050, 60 per cent of Italians will have no brothers, sisters, cousins, aunts or uncles. In the developed world, only the United States, with a 2.1 birth rate, is replacing itself.

The future belongs to the cultures that are having children. All of the other cultures are committing generational suicide.

"A Continent of Losers"

An interview with German sociologist Gunnar Heinsohn on global population changes:

“Look at the Polish people,” says Heinsohn — who was born in 1943 in the city now known as Gdansk, but which he still calls Danzig, the son of a German submarine captain who lost his life near Newfoundland five months before his son was born. “Here is a nation with proud traditions. Poland saved Europe from the Mongols, the Turks and the Bolsheviks and ended up bringing down Communism. And yet they have a lower birth rate than the Germans. They are down to 1.2 children per woman. In addition, over the last 15 years they have already lost 2 million of their best people. Perhaps emigrants tell their parents that they are coming back, but they won’t. That is why I am saying that countries such as Poland, Latvia and Lithuania are doomed. They have no attraction for immigrants. The same thing is happening with Russia. Who wants to move to Russia? And look at the newest members of the EU, Bulgaria and Romania. Romania is the first country in the world where there are more retirees than active workers, and we let them in. The same with Bulgaria, which has the world’s fastest-dwindling population. The young are moving out, and with a clean conscience, because they believe that tomorrow Brussels will pay for their parents. So the EU has accepted 27 million people who wanted to get inside to secure their pensions. And in the European centre they are still overjoyed to have attracted millions more than the USA. That will make us strong, they believe.”

When I was in college and for a long while after I believed that overpopulation was the worst problem. Back then I thought China's one child policy was wonderful. Mark Steyn has criticized it as suicidal, and so does Heinsohn.

“China is the fastest ageing nation in the world after Germany, Japan and South Korea. We usually view China as a sleeping giant. I on the other hand see China as a source from where the Western nations will skim the best. And they will get them. Currently, rich Chinese are preoccupied with moving their riches to Switzerland because with the few children being born in China, people in their 40s have no chance of ever getting a pension. China is down to a fertility rate of 1.6 children per woman. The country is already losing 500 000 of its best every year. The young see no hope of ever being able to build a pension plan in their home country. Therefore they settle in Taiwan, Hong Kong, Singapore, Canada etc.”

And what happens to real estate when the population drops?

“In East Germany they have just decided to demolish an additional 400 000 apartments. There are no people for them, and the empty apartments ruin the banks by depressing the rents and the prices of housing. In West Germany we are also losing population. We have to stop taking the least suitable immigrants. To attract young and competent people, we might give them a house. That was the way Brandenburg secured the French Huguenots in the 17th century. But I doubt it will work today.”

Via Kim du Toit.

What Happens After Depopulation?

Mark Steyn:

It's hard to accept you have a demographic crisis in China, Japan, Belgium, the Netherlands or Britain because by comparison with the US these are very crowded places, and the idea of losing, say, 20% of the population and freeing up a bit of space sounds very appealing. The difficulty is the bit you lose. In Europe (I happen to be in Spain at the moment), it's very weird to go to a Mediterranean wedding with tons of aunts, uncles, gram'pas, gran'mas, but no kids, or to a German suburb built for families and to hear no children playing in the street. Yes, you'll have more space, in the sense that a poor mill town has more space after the mill's closed: the young folks have fled but at least ol' Bud and Earl won't have to wait for stools at the lunch counter, assuming it hasn't gone out of business.

Russia's "Day of Conception"

AP:

A Russian region best known as the birthplace of Vladimir Lenin has found a novel way to fight the nation's birthrate crisis: It has declared Sept. 12 the Day of Conception and for the third year running is giving couples time off from work to procreate.

The hope is for a brood of babies nine months later on Russia's national day. Couples who "give birth to a patriot" during June 12 Russia Day festivities win money, cars, refrigerators and other prizes. Ulyanovsk, a region on the Volga River about 550 miles east of Moscow, has held similar contests since 2005. Since then, the number of competitors and the number of babies born to them have been on the rise.

[...]

Russia, with one-seventh of the Earth's land surface, has 141.4 million citizens, making it one of the most sparsely settled countries in the world. With a low birthrate and a very high death rate, the population has been shrinking since the early 1990s. It is falling by almost half a percent each year. Demographic experts expect the decline to accelerate, estimating Russia's population could fall below 100 million by 2050.

China Enforces One Child Policy, Birth Permits with Forced Abortions, Forced Sterilization

Have you ever heard someone say that people should have to have a license to become parents? Here's what that looks like in reality.

Yang Zhongchen, a small-town businessman, wined and dined three government officials for permission to become a father.

But the Peking duck and liquor weren't enough. One night, a couple of weeks before her date for giving birth, Yang's wife was dragged from her bed in a north China town and taken to a clinic, where, she says, her baby was killed by injection while still inside her.

"Several people held me down, they ripped my clothes aside and the doctor pushed a large syringe into my stomach," says Jin Yani, a shy, petite woman with a long ponytail. "It was very painful. ... It was all very rough."

• NPR: Cases of Forced Abortions Surface in China
• Fox News: Why Does NOW Support China's Forced Abortion Policy?
• U.S House of Representatives: FORCED ABORTION AND STERILIZATION IN CHINA: THE VIEW FROM THE INSIDE
• BBC: Taiwan and China in abortion row
• Amnesty International: China Report 2005
• National Review: The Forgotten Women
• Capitalism Magazine: Pat Robertson Supports Forced Abortions in China, But Opposes Voluntary Abortions in America
• MSNBC: China victims decry forced late-term abortions
• Time: Why Forced Abortions Persist in China
• UK Independent: China admits women were forced to have abortions

Steyn on Population Decline

The Corner

John O'Sullivan and I occasionally discussed Montreal, and he observed that a big-city heritage without big-city overcrowding can be very pleasant: You've still got all the art galleries and symphony orchestras and so on. You've got tickets for Pavarotti at the Place des Arts. Curtain up, 7.30pm. So you leave at 7.20, park outside the front steps and stroll in. As John put it, societies in the early stages of decline can be very agreeable - and often more agreeable than societies trying to cope with prosperity and rapid growth.

Which brings me to my usual everything-comes-back-to-demography shtick. Precisely because the first stages of decline are so agreeable, it's very hard to accept it as such. Part of the problem in Europe is that, when chaps like yours truly shriek "Run for your lives! The powder keg's about to go up!", etc, the bon vivant enjoying his Dubonnet at the sidewalk cafe thinks: Are you crazy? Life's never been better. Civilized decline can be so charming you don't notice it's about to accelerate into uncivilized decline.

"No Country for Young Men" - the Boomers Retire

Megan McArdle looks at likely effects of baby boomer retirement that officially began last week:

At one point or another, you’ve probably heard the speculation that once the Boomers start selling their stocks and mutual funds to support their retirement, the flood of sales will cause the market to crash. That’s plain wrong: the Boomers were born over a period of 18 years, and they will retire over a similar span; moreover, most of them will not start cashing in their stocks immediately. Most people, evidence shows, wait to break into their 401(k)s until they have to. David Wise, the head of the National Bureau of Economic Research’s aging program, has, along with his colleagues, run multiple models looking at what will happen as the Boomers sell out, and he believes the effect will likely be modest.

But the outlook for equity markets is cloudy nonetheless. The problem is more basic: stock prices reflect both a company’s current earnings and its expected growth in earnings. A high price-to-earnings ratio means investors expect fast growth in future earnings. If you think economic growth is going to slow, the stock market looks overvalued today. Historically, stocks in aggregate have tended to trade at P/E ratios between 12 and 20. Right now, the P/Es of the three major indexes are on the high end of that range, implying the expectation of faster-than-usual economic growth. That sort of growth will be awfully difficult to achieve as the Boomers retire—and the problem could persist for decades. It is possible that, as the Yale economist Irving Fisher infamously said in 1929, “Stock prices have reached what looks like a permanently high plateau.”

And on the difficulties and expense of transitioning parts of the economy from catering to the young to catering to the aged:

My grandmother, who is blind and physically frail, was able to live at home much longer than she otherwise could have because she had Meals on Wheels, a home health aide, and a Life Alert-type necklace to call for help in case she fell.

But these services require a lot of labor. According to an analysis by McKinsey Global Institute, the number of hours required to produce an automobile in North America fell by 1.7 percent annually from 1987 to 2002, to an average of about 100 hours. Meanwhile, it still takes about the same amount of time as it always did to drive a senior to a doctor’s appointment, or to help an older patient bathe and dress. Productivity growth is faster in the things that kids consume than in the things that the elderly need.

This is is yet another example of the problems described under the heading of Baumol's cost disease:

Baumol's cost disease (also known as the Baumol Effect) is a phenomenon described by William J. Baumol and William G. Bowen in the 1960s. The original study was conducted for the performing arts sector. Baumol and Bowen pointed out that the same number of musicians are needed to play a Beethoven string quartet today as were needed in the 1800's; that is, the productivity of Classical music performance has not increased.

In a range of businesses, such as the car manufacturing sector and the retail sector, workers are continually getting more productive due to technological innovations to their tools and equipment. In contrast, in some labor-intensive sectors that rely heavily on human interaction or activities, such as nursing, education, or the performing arts there is little or no growth in productivity over time. As with the string quartet example, it takes nurses the same amount of time to change a bandage, or college professors the same amount of time to mark an essay, in 2006 as it did in 1966.

Baumol's cost disease is a fascinating topic that touches on many areas of economics and public policy. For instance, it's a a likely influence on the fact that college tuition and health care costs tend to rise much faster than the general rate of inflation.

Russia's Population Decline Slowing

Strategypage - More babies, less oil:

Russia is reversing its population decline, which began before the Cold War ended, and accelerated after the collapse of the Soviet Union in 1991. Births were up 14 percent last year (to 1.6 million), over 2006. At its worst, a few years ago, the Russian population was declining 750,000 a year. A growing economy, more health consciousness and more pro-family laws have all contributed to this. Still, it will be another decade or two before the decline will halt. By then, the Russian population will be under 140 million. It went down 200,000 last year, to 142 million. At this rate, it would be under 100 million by 2050. That, however, is being reversed.

Russia has been headed towards extinction-level population loss. Contrary to the first sentence of the Strategypage article excerpted above, Russia's population decline has not yet reversed. The population there is still in decline, but the decline is now at a somewhat slower rate and if the trend continues they'll begin restoring some of their population.

WaPo Notices Japan's Population Decline

Washington Post - Japan Steadily Becoming a Land Of Few Children:

The economic and social consequences of these trends are difficult to overstate. Japan, now the world's second-largest economy, will lose 70 percent of its workforce by 2050 and economic growth will slow to zero, according to a report this year by the nonprofit Japan Center for Economic Research.

Population shrinkage began three years ago and is gathering pace. Within 50 years, the population, now 127 million, will fall by a third, the government projects. Within a century, two-thirds of the population will be gone.

In what is now being called a "super-aging" society, department and grocery stores have recorded declining sales for a decade -- and new car sales have fallen for 18 consecutive years.

Rural Japan, thus far, has borne the brunt of the slide. In depopulated small towns, stores are closing, governments are desperate for tax revenue and there are chronic shortages of doctors and nurses. The government is subsidizing the development of robots as caregivers for the old.

There's always the hope that Japan's government will change the policies that led to the baby bust, but it may not be pretty. People have fewer children because they depend more on government programs than the family, and because of the taxes required to fund the programs they have no choice but to have fewer children. Japan is likely to have to cut those government retirement and health programs or else the burden on the ever-shrinking working population will grow more burdensome. Else young people will realize they're better off taking their college degrees and their passports to a country that doesn't punish them for the poor decisions foisted on them by politicians who will have passed on by then. Either way, one generation or another is going to have to pay for those decisions.