Depopular: what about depopulation?

Syrian migrants are big in the news.  Eduardo Porter of the NYTimes says the Syrians are the vanguard of an “unstoppable force of demography.”  Spandrell agrees and says better small numbers of Syrians now than large numbers of Africans later.

In addition to the inevitability, immigration is supposed to be good for first world countries because of their declining populations.  Here in Japan, the trend is quite extreme:

chart3

According to this graph, we’re now living at the end of a broad population peak, and the population will be about 20% lower by 2050, when I will hopefully be old enough to be dead, if not retired.

This declining population is going decrease prosperity, which is dependent on population.  This is the received speech, recspeak, about depopulation and immigration: the challenge facing us is how to stay rich, but no worries, because immigration.

The logic seems pretty straightforward.  If there are only so many workers and if working in a factory is more important than driving a train, then the trains are going to stop running.  When that happens, we all suffer.

But, of course, we all know that our ability to foresee the future is limited.  Our best predictive powers are based on extrapolating from the past.  And indeed, there are lots of people who will tell you about the wonders of immigrants.  The NYTimes cites a study showing that almost all the OECD countries had economic benefits from immigration during the 1990s.  Wages went up for everyone, including low wage earners!  (Nevermind for a second that this study is actually an examination of immigration simulations.)

It struck me while reading that saying increased populations have been great for us is not the same as saying that decreased populations have been terrible for us.  But certainly there must be plenty of those case studies to examine, right?

Now, I’m not terribly knowledgeable about these kinds of things, so I start with Wikipedia, which can give me the simpletons’ 10,000-ft view of the subject… Wikipedia.org/wiki/Population_decline  Here is a simpleton’s summary:

“Predictions of the net economic (and other) effects from a slow and continuous population decline (e.g. due to low fertility rates) are mainly theoretical since such a phenomenon is a relatively new and unprecedented one.”

That doesn’t entirely surprise me.  Basically, dire predictions about population decline come from (1) modeling, not historical examples, and (2) assumptions coming from political economy rather than from the biological study of ecology, population dynamics, extinction, etc.

In my simpleton mind, I start asking questions like: when someone says Japan’s Tohoku region is now lower in population than it was in 1950, does that mean life in pre-1950s Tohoku was terrible?  Were Tohoku people in 1949 saying, “Oh man! Life sucks! If only we had some more people!!”?

Here are some more questions:

Correlation-Causation Confusion

We’re moving into new territory in terms of population decline.  Until now, the world population during the modern period has basically been growing.  Life has been getting better too.  Is the relationship between these correlative or causative?  Somebody please run these tests in alternate universes:

  • The population and technology both stabilized around 1950.
  • The first world population continued growing while the third world population declined.
  • Population dynamics stayed the same but the information/digital revolution of the 1950s-1990s never happened.
  • Population decline started post-WWII, but Kennedy initiated a program of developing automated industrial and farm systems instead of a space race.
  • etc.

And these tests would still work on assumptions I don’t know if we can make.  How about this scenario…

  • A space virus infects humanity such that first-world couples are unable to produce children at a rate greater than 1.8 per couple, yet they would, if they could, choose to do so.

You see my point?

Economic models like the ones being cited by the NYTimes have no way of capturing the fact that net migration is not a static input into the economy.  Immigration exists in–indeed, is made possible by–certain social circumstances that include assumptions on the part of both traditional labor and capital as well as those engaged in technological innovation.  And when I say social circumstances, I’m not just talking about capital choosing to pursue labor inputs instead of technology, I’m talking about the broader psychological impact and economic consequences of living in a regime where the “newspaper of record” tells us that demography is “unstoppable” and that, also, you are a bad person if you disagree.

GNI co-efficient

A lot of pundits have been saying that the Syrian influx has been about breaking Germany’s unions to lower wages and enrich business owners.  I don’t know if that’s true.  However…

I do note that when the NYTimes talks about the awful predicted effects of decreasing immigration in UK, it says that immigration will result in a whopping 3% more income in 2060 for wage earners.  What is the expected benefit to business and government of these immigrants?  Only 3%?  I wonder…

Also, here’s Jesper Koll of JP Morgan at TEDxKyoto, explaining why population decline is going to be good for Japan’s part-time workers…

Now, I’m not sure I buy his argument that the reason people don’t have kids is that they can’t afford to get married.  I see my English students getting married and not getting married, and it doesn’t seem to have anything to do with their employment status.  Also, lots of young people have plenty of money for going out on the town.  Could they use that money for getting married and raising families?  Maybe.

Anyhow, if Koll’s right, the situation the country is in now, with a stagnant economy but a large population, is the worst case scenario for people at the bottom and middle.  Depopulation may result in an improved situation vis-a-vis corporate and top-income earners.  (Not that that’s too bad in Japan, but maybe the same dynamic could hold true in a depopulating Germany sans immigrants…?)

Frankly, my dear…

Speaking of 3%, who gives a damn?  UK immigration is supposed to stave off a 3% loss of income in 2060?  For a worker making £20,000 in today’s money, that’s a loss of only £600.  £600 isn’t nothing.  It could 1-2 months of rent or food.  Or!  But it’s enough to change your nation over?  Maybe it could be re-branded as the “Keep Britain British Tax”–KBBT.

Anyhow, if we return to my point above about correlation-causation, I think we have to ask when a prediction about incomes in 2060 would hold true if the UK population changed its national psychology to the point being willing to reject immigration for the next 40 years.

Putting off the inevitable

NYTimes says demographics is an unstoppable force.  The main problems facing first world countries, which immigrants are supposed to solve, have to do with renewing economic growth and propping up pensions and social security nets.  If demographics is an unstoppable force, by solving depopulation with artificial repopulation, aren’t we just kicking the can down the road?  Don’t we need to rethink relying on growth models of national prosperity and social services?  If living in a prosperous Japan makes Japanese want to stop having babies, won’t living in a prosperous Japan make Philipino, Pakistani, Brazilian, Indonesian, Malaysian, Chinese, etc want to stop having babies as well?  Then who are you going to import?

Is there another way out of our reliance on growth that doesn’t involve pain–some other way on the other side global population explosion?  If there is, I’m not aware of it.  Robots?  Lots of robots?  If we’re not going to cross our fingers and hope that Japan creates android nurses, aren’t we better off biting the bullet now?  Especially now while some of Japan’s savings is theoretically left?

Tomorrow minus a taco, not

Speaking of robots, the NYTimes says one of the economic benefits of immigrants is “consumption patterns” that are different from the natives.  It strikes me that, if depopulation has such a huge effect on the economy, that ought to change consumption patterns as well.  Can’t we expect new lifestyles and patterns of life to emerge from depopulation?  I’m not talking about today’s life with a dash of impoverishment–not tomorrow minus a taco, a bratwurst, or a takoyaki.  I’m talking about a reformulation of lifestyles. Maybe without a proliferation of cheap products and cheap labor, we’re going to make totally different decisions about what we value.  I hope so.  I’d rather see that than see SE Asian immigrants sitting on cardboard up and down Teramachi Street in Kyoto the way they do on a Sunday afternoon in Hong Kong.

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