Posted on 12/02/2002 1:51:58 PM PST by Leisler
But the great point this article makes is the impact on the economy when population growth drops past replacement. Two thirds of the Western economy is dependent on consumer spending. [Sure, ultimately, all of it depends on cumsumer spending --- TQ] Consumer spending is fueled by young and middle aged adults, who are in the acquisition phase of life and many of whom are raising families.
I am afraid this is a speculation, however. Firstly, the ecomomy can move along just fine by replacing the old stock with new; one does not need expansion of the population for the growth of economy.
Secondly, it is a misconception that the young people "fuel the economy." It may be based on the misleading observation that businesses target the young, but this is often because the latter are influencers, not necessarily buyers. To the contrary, it is people over 40 that are in their prime of the earning power and the retirees who spend out of wealth --- these are the people who pay.
Finally, what you posit is the economy of scale: that efficiency is higher in a larger population than in the smaller. I do not think anyone has observed such economies or diseconomies.
I'm really surprised no one has linked the interminable Japanese recession or the stagnation in Europe to the problem of their greying populations. This is because another, more plausible reason is readily available: in both cases the population is unwiling to abandon broken, outdated institutions. In teh case of Japan, for instance, plenty of advisors told them what to do, but the instructions are simply not culturally acceptable. In Germany, similarly, most economists, including those who advise the government, knew for quite some time that the the traditional, paternalistic state is no longer viable. This too is not culturally acceptable yet.
The difficulty is a fundamental one: suppose you have perfect foresight and knowledge, how do you lead an ignorant populous?
When it comes to masses, knowledge is not as important as sentiment. Consider, for instance, that our Constitution is in plain view for two centuries, hence known, yet no country bothered to adopt its basic elements. This is becuase the sentiment in those countries lies elsewhere; ignorance is clearly not the ussue.
I assume that you are being sarcastic. Since people are not inter-chageable, the large influx from outside the Continent is the single most serious aspect of the problem. Birth rates rise and fall. At the worst, the fall in the birthrate will cause a temporary crisis. But a change in the population base will permanently change the nature of the respective Societies. Europe needs a contemporary Kipling, to put the dynamics of what is going on in perspective.
No one can predict the precise point when the birthrate will surge upward, once more; but one suspects that it will, sooner rather than later. Certainly, the generation who are now children, may live to see a real incentive for having children in the inability of the State to care for the aged in the near future, causing families to look to their own families for old age security. But whatever, the birthrate will turn upward again, just as that of the American Indian did, to make fools of the pundits around a century ago, who were predicting his rapid extinction.
William Flax Return Of The Gods Web Site
Human beings simply will not work, thrive or reproduce if every aspect of their lives is buttoned down, regulated, taxed and controlled. Why work if everything you do is going to the Moroccan layabouts arguing in cafes all day? Why have children if you can't earn enough to escape the grip of state education? Why look forward to the future if your power to shape it is limited? Why vote if all the parties adhere to the same, dry pro-European consensus (which is consequently folks like Haider do well)?
Europe has severe problems. The Euro has exacerbated them - I am glad Britain has ducked many of them by staying out of it. I was shocked to read that GDP per head in the UK is actually set to exceed Germany next year. Whether Labour is smart enough to realise the source of our success is our relative freedom in comparison to the Continent is another issue.
Regards, Ivan
To the contrary, it is people over 40 that are in their prime of the earning power and the retirees who spend out of wealth --- these are the people who pay. Again, I agree, particularly as to "big ticket" items such as homes and autos. I was referring primarily to over-60, where Europe and Japan are becoming top-heavy.
Finally, what you posit is the economy of scale: that efficiency is higher in a larger population than in the smaller. I do not think anyone has observed such economies or diseconomies. Actually, that's not my point. In a consumer-driven economy a greying population will lead to reduced consumer spending which will result in reduced production and sales which will result in lower incomes and tax revenues at precisely the time the governments need the revenue to pay old-age pensions under their welfare schemes. The size of the national economy has little to do with the problem.
This is because another, more plausible reason is readily available: in both cases the population is unwiling to abandon broken, outdated institutions. In teh case of Japan, for instance, plenty of advisors told them what to do, but the instructions are simply not culturally acceptable. In Germany, similarly, most economists, including those who advise the government, knew for quite some time that the the traditional, paternalistic state is no longer viable. This too is not culturally acceptable yet.
Again, I agree. Reform to a free market economy on the US model would most decidedly help Japan and Germany. But they are still caught in a demographic vice. With a greying population and depleted ranks in the 20-60 range, Japan does not have a sufficiently large domestic market to support its economy and must rely on exports, but its wage structure is now too high to repeat it's 1960's experience. One answer for Japan and Germany would be to turn to the US example and encourage entrepeneurs, high-tech research and development, services (including consulting), and globalization, many of which involve offshore subsidiaries and production. But such a change would require more than free market reforms, it would require cultural change.
When it comes to masses, knowledge is not as important as sentiment. Consider, for instance, that our Constitution is in plain view for two centuries, hence known, yet no country bothered to adopt its basic elements. This is becuase the sentiment in those countries lies elsewhere; ignorance is clearly not the ussue.
Again, I agree. I reflect on the basic deal Bismarck made with the Socialists in the 19th Century, that the means of production would remain in private hands if the government guaranteed a cradle to grave welfare state. Liberty can be scary as well as exciting. Many people prefer security to liberty.
Actually, with 5-6 children/Moslem woman, and 0.9 children/Eurowoman, the EU will be an Islamic Republic and the public pension system will no longer be of concern.
If Europe wants 1, they need to deregulate (screw the EU), open trade, and become less socialist. They will also need to stop the government-leftist native population control programs called Sex-ed.
If they want two, they should just set cruise control.
This writer skipped over one of the major reasons why people have children: a sense of obligation and loyalty to their culture and people. Socialism has convinced europeans that they are atomized individuals whose only loyalty is to the state. As such, they live their lives as if their only loyalty was to themselves and to materialistic consumption.
Healthy "tribal" cultures place a variety of carrots and sticks in front of their members to procreate so as to ensure the survival of the tribe. Without this motivating force, people naturally follow the most convenient and hedonistic path....and live their lives accordingly.
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