Wednesday, April 23, 2008

Germany - Keeping People at Home?

by Claus Vistesen


Following up on a point I mentioned about international migration in my previous post on global demographics (where I reviewed a recent paper by David S. Reher) I would like to briefly examine some of the issues raised in a German context. In my post I latched on to a point made by Mr. Reher about how some low fertility countries might see adverse effects from exporting surplus labour to other countries. The argument was specifically centered on East european transition economies but, as you will see in what follows, the argument can also be expanded. The main issue becomes one of rearranging those proverbial deck chairs on the Titanic (i.e. to get the best spot relative to watching the inevitable demise of the ship) as many countries across the globe seek to mitigate a labour dearth by importing foreign labour. The allure of such policies should not be neglected. Relative to actually doing something about the underlying issue (i.e. nudging fertility back up) receiving foreign labour becomes an immediate, if only temporary, fix for labour shortages and even in some cases the source of unprecedented economic booms (Spain would be an excellent example here). In this present context it might serve us well to take a trip to Germany and do so by looking at an eloquent piece in the IHT (aggregated from Reuters) by Erik Kirshbaum. As Kirshbaum neatly points out we all know that Germany is hard at work trying to ramp up its industry and export its pension and health systems out of economic trouble but is also, as it were, exporting itself into even deeper trouble in another department - the human capital one. Basically, it is one thing shipping off semi-conductors and cars, but it is quite another to ship out human capital, since the latter is becoming an increasingly scarce resource in Germany.


Still plagued by high unemployment owing to the turmoil of reunification in 1990 and rigid labor laws, Germany has been helping its skilled and less-skilled jobless workers match up with foreign employers searching for manpower. The country has also been offering financial support to cover moving and transportation costs for unemployed Germans searching for jobs across the European Union, and even as far away as Australia and Canada. In one typical example, a newspaper in Fuerteventura, one of the Canary Islands of Spain, was recently filled with advertisements placed by Germans hunting for jobs.

"German seeks job in hotels or tourism," read one. "All relocation and travel costs paid for by German Labor Office."

Germany had an unemployment rate of 8 percent in February, about one percentage point higher than the euro zone average: 3.6 million people in the country are without jobs and more than 155,000 Germans emigrate each year. Many thousands have been helped by the Labor Office's International Placement Service in Bonn, which offers to some "Mobilitãtshilfe" (mobility assistance) or a "Mobilitãtsprãmie" (mobility bonus). The financing, known as the "Mobi," helps cover moving and travel costs for jobless Germans and their families. It is discretionary and aimed at those with job prospects abroad, although it is also available for relocations inside Germany.

"The mobility assistance benefits can be used for moves to anywhere in the world," said Sabine Seidler, spokeswoman for the International Placement Service in Bonn. "They're granted on a case-by-case basis and there's no upper limit on the sum involved. Applicants usually must have a contract and meet certain criteria. The main purpose is to help those who've lost their jobs find work as quickly as possible."


Now here on Demography Matters we have previously tried to draw attention to the worrying rend in net German migration. Back in May 2007 we cited the last available report from the Federal Statistics Office which showed that

"......on the basis of provisional results, 662,000 persons in-migrated to Germany in 2006 and 639,000 persons out-migrated. This results in net inward migration of 23,000 persons. That was 46,000 in-migrations less and 11,000 out-migrations more than in 2005. Consequently, net inward migration decreased strongly from the previous year (–71%), following a decrease by just 4% from 2004 to 2005. So there is a net inward balance of migrants in 2006 of 23,000. "

In view of the significant ageing process which is taking place in Germany this steady decline in the net balance is indeed preoccupying. Germany is currently a long long way from making up for all those "missing births" with inward migration. We have previously commented on this situation on DM a number of times (and here). We also cited an article from the Financial Times which gave some indication of the impact the absence of substantial inward migration was having on some sectors of the German economy:



Germany’s decision to restrict the working rights of east Europeans is hitting consumers where it hurts – their asparagus steamers. After this year’s warm, wet spring, the sandy plains of central Germany should have yielded an asparagus vintage for the history books. Instead, entire fields of the delicacy are rotting unplucked. Farmers, politicians and economists are scrambling for an explanation. At the Federal Statistical Office, which charts the amount produced in the country, experts are warning about a paradoxical year, with a harvest below the record 82,000 tons registered in 2005 despite better growing conditions.

Everyone agrees on the reason; there is a shortage of pickers. The 300,000 foreign seasonal hands, mainly Poles, who normally work the three-month “Spargelsaison” seem to have better things to do this year...... Herbert Buscher, economist at the IWH research institute in Halle, agrees that Germany, whose booming economy is now suffering from drastic shortages of workers in certain sectors, has “shot itself in the foot with its restriction to the free movement of workers”.
However what we now need to note is not only that Germany has unwisely beeen placing restrictions on the free movement of fellow EU workers into its labour market, it has also been operating a policy of helping people to find work abroad and, perhaps much more worryingly, it still seems to be encouraging this process. Re-locations inside Germany are of course one thing but actually helping people to leave Germany seems to be extraordinarily ill-advised at this point. Obviously, we can all see how it helps "beef-down" the unemployment statistics but as a long term policy it is anything but sound. Some however, are now beginning to sound the alarm ...


In Germany, the assistance is controversial. Economists and industry leaders say paying people to leave a country with a shrinking population and one of the lowest birth rates in the world is a recipe for disaster. Shortages of skilled labor are now acute in industries like engineering and car production, but they also loom in sectors like retailing, health care and finance. Meanwhile, "depopulation" has become an explosive issue in some areas, especially in the formerly Communist east.

"It's obviously better if they find work in Germany and pay tax, as well as contribute to the state's social welfare system," said Werner Eichhorst, deputy director of labor policy at the Institute for the Study of Labor in Bonn.

"In the short term, emigration takes people off jobless rolls, but in the long term we're losing workers with skills," he said. "It's usually the best and most flexible who leave. They're also often at ages where they have children. They're lost to Germany and obviously their children won't contribute later either."


The article also quotes Deutsche Bank's chief economist Norbert Walter for saying that even though he formally supports the mobility aid Germany should try kick it into reverse. Specifically Walter mentions how Germany will need to attract a significant amount of immigration in the coming years to compensate for the decline in the labour force. Right on cue Mr. Walter. Unfortunately, with Germany's size and the region's demographic trends (e.g. in Eastern Europe) this is going to be anything but the trifle Mr. Walter seems to think. Essentially, I don't think I can express myself much clearer than this. Germany desperately needs to instigate a sound policy on migration. The current one which in some ways encourages skilled labour to leave is way past its time and peak.


Update

We are incorporating the following three additional charts to accompany the discussion in comments.

(please click on images for better viewing)









Further the newspaper Frankfurter Allgemeine Zeitung reported on Friday 25th April that the German government has decided not to open its doors to East European workers till the second half of 2011 - the very last date possible under the EU Accession Treaty for the new members. This would seem to indicate that far from addressing its demographic problem Germany is at present moving backwards on it.

The executive committee of the conservative Christian Democrats (CDU) approved pushing the deadline on opening Germany's borders back two years, from 2009, committee member Karl-Josef Laumann told the Frankfurter Allgemeine.

"The extension has been decided," Laumann said.

In 2005 Germany persuaded Brussels to allow it to impose restrictions until 2009 because of fears that a flood of cheap labour would put Germans out of work.

The newspaper reported that both the CDU and their junior partner in the German parliament's ruling coalition, the center-left Social Democrats (SPD), were in favour of the extension. German Labour Minister Olaf Scholz, of the SPD, expressed support two months ago, while German Chancellor Angela Merkel has said she could not imagine opening the borders prior to 2011.

The Financial Times also had an article recently reporting on a study by the consultants McKinsey who warn that more than 10m Germans could fall into poverty by 2020 because of insufficient economic growth. Assuming annual gross domestic product growth of 1.7 per cent, those earning between 70 per cent and 150 per cent of the average income – the standard definition of the middle class – will constitute less than half the German population by 2020, compared with 54 per cent today, according to McKinsey. Of course this is assuming sustained economic growth at an average of 1.7% per annum on average, which may be a questionable assumption. Anything less than this number and the problem, of course, will be greater. Gross domestic product in Germany rose by only around 1.4 per cent in the decade to 2006, 2007 was a very exceptional year since global trade grew at record rates thus giving a huge boost to german exports, and it now remains to be seen what sort of annual growth Germany can produce during an economic downturn.

“In recent years, the German growth model has relied almost exclusively on productivity gains,” the authors of the McKinsey report write. “Given the new challenges, this concept is now reaching its limits.” McKinsey also warns the government against short-term measures aimed at boosting income and consumption. Only structural steps, the study says, can raise annual GDP growth to 3 per cent – the level it says is required for standards of living to stabilise. The consultancy blames Germany’s poor long-term economic prospects on slowing productivity gains, falling working times, a shrinking working population and a failing education system.

18 comments:

vital core said...

Several points:

1) If food is rotting in the fields, there are jobs available that Germans just won't do. I've noticed most of these stories in the USA are propaganda, and not due to labor shortages.

2) A country has to ask itself: how important is culture? Because if Germany opens up the doors, it won't be Germany for very long as the birth rates of immigrants from outside Europe are much higher (those within Europe which wouldn't change the German culture much don't have the people for long). So immigration, in a practical sense, is just a wholesale cultural surrender. One man, one vote. Might as well just give up.

3) Germany could lock the borders and implode economically. This is an option, and might actually be their best course, because it is at least possible they might turn around the birth rate sometime in the future. But once the large-scale immigration happens, Germany as a culture is over, and that's for sure. Why not die off with at least some hope than simply surrender?

4) The only real solution for Germany I can see: First, make pensions very lean, so that older people simply need children to help finance their old age. In a sense, they do, but they simply use other people's children (in the old days, a person without children suffered in their old age economically, but today, they benefit economically). Next, seal the borders and wait a generation. It's a longshot, but better than giving up all hope, which the immigration solution is.

5) However all this is really a moot discussion, because Germany has a catch-22: the same cultural ennui that creates a lack of children will also prevent them from doing what is necessary to survive. Young Germans now see themselves as world citizens, not as Germans. So they are toast. In the end, they will indeed allow immigration and vanish culturally and genetically from the map. I think it's a safe bet Germany won't be recognizable within 100 years, and within 300 Germans will have vanished as fast as the American Indians did in America circa 1700. A few genetic threads running around here or there, but effectively finished.

Aslak said...

You're already seeing moves towards more natalist policies in Germany. If they continue down that path, it might (just might) work about as well as it does in Scandinavia or France, i.e. fertility rates at or just below replacement.

Another thing is that immigration doesn't necessarily mean eradication of the native culture. German culture will remain dominant if they manage to have an immigration policy that does not target one single group (like they did with turkey). Diverse and controlled immigration will allow German culture to remain dominant.

Making demographic projections about Germany 100 years from now is meaningless as the fertility rate will probably go back up as society responds to the dearth of children. I know Edward believes in a low-fertility trap, but I'm not convinced. Societies can be amazingly flexible and tend to respond to challenges. Germans are aware of their demographic problem and are already taking steps to address it. I'm more worried about Italy, because its government is far less capable than the German one. I'm not sure they're competent enough to address the problem.

vital core said...

alsak, Making demographic projections about Germany 100 years from now is meaningless as the fertility rate will probably go back up as society responds to the dearth of children.

Could be. But when you have TFR around 1, you don't have long to change your mind.

Also, I'm not sure Germany has the human capital left to raise large families - this is a serious skill that isn't learned overnight. The baby booms in the 1950s still had large, intact families and a non-individualistic, supportive culture. Germany currently doesn't have much in the way of this today. They would have to pull themselves up from their bootstraps, and reinvent the whole culture. It's much easier to go down than up here.

And I don't think cultures respond as a group like that. Germany is just a bunch of individual Germans. Why would each German, secular and individualistic, choose to do what is best for the group?

Aslak said...

I'm not convinced cultural change is necessary. It's true that religious people tend to have higher birth rates. That does not mean that religion is the only way to raise birth rates. What I'm advocating is what seems to be working in parts of Europe. 1) Generous maternity leave 2) subsidized or free child care 3) Financial support for families.

If you want women to have high fertility rates there are essentially two options. You can either have a patriarchy where women's main role is to be mothers or you can facilitate work so they can have a career and raise a family at the same time. I don't think the first option is feasible for the reasons you mentioned, so we should focus on the latter option. It's encouraging that Germany is now starting to take steps in that direction.

Edward Hugh said...

Hello again Aslak:

"I know Edward believes in a low-fertility trap, but I'm not convinced. Societies can be amazingly flexible and tend to respond to challenges."

Well look, the conclusion I am coming to is that these things are a lot less flexible than many people imagine. I have updated the original post with a couple of extra charts which might aid the discussion.

Basically the issue in Germany is quite different from that in Sweden or France, where the sorts of policy you are talking about were put in place systematically starting from the 1930s - when fertility first went below replacement (as it did in the US - this is the importance of the whole boomer phenomenon - and the North of Italy incidentally). These policies do seem to have borne results, but they are very, very long term, and I don't think you can just turn German fertility around.

Basically what separates low fertility in German speaking cultures (ie including Austria and parts of Switzerland) is the very high level - by international comparison - percentage of women who remain childless. This sets the German speaking cultures apart say from the Latin ones, where most women want to be mothers, but since - as I note in my recent Italian post - their families love their children too much, they simply don't get round to having them.

Where you can notice this is in the area of international adoption, which is a massive phenomenon in a country like Spain (since there are a lot of frustrated would be mums) in Spain, but nowhere near so many in Germany (proportionately to the population, of course).

Now if we look at the chart for childless women in Germany, we will see that this has always been pretty high, it fell to a low around the 1930s birth cohort, and subsequently has been rising relentlessly. The trend is very long term, and changing it is not going to be easy or happen overnight, indeed I have some soubt that it is going to happen at all. My reading of all the economic arguments which are coming out of Germany at the moment seems to suggest absolute complacency on all this, and I get the impression that many Germans feel that they are just fine as they are on this front. I guess Germany is also a country where a comparatively high percentage of the population would agree with the points Stephen is trying to make about global "overpopulation" and resource shortages on the other thread.

I also put up the chart showing German long term completed cohort fertility (note, not TFR, CFR is a much more accurate measure of what is happening, and again it is interesting to note just how long term the German issue is.

The contrast with Sweden is very clear, and again basically cohort fertility has been declining in Germany since around the 1935 birth cohort. And really it doesn't stop going down, so - apart from fingers crossed and hope against hope - I don't see where the grounds for optimisim come from.

In fact, if you look at the third chrat I have put up - which compares total population between France and Germany - the difference is really quite dramatic. German population is now starting to fall, while the - much younger - French population continues to grow following an almost linear trend (of course Stephen would say this was bad).

I wouldn't mind betting that the French population will be larger - and much richer - than the German one by the time we reach that famous 2050 horizon. At the very least this is going to have some interesting repercussions in terms of future EU political dynamics.

SESALMONY@aol.com said...

Dear Friends,

Whether we are talking about Germany, France or Sweden, these countries are in the Western European 'orbit'. Despite their differences most of these countries are seeing their populations increase at a decreasing rate.

The population of Western Europe and other regions where population growth rates are declining represent a relatively small part of the global human population. There are many other countries worldwide where population numbers are growing much too rapidly, and these countries represent a much larger portion of the world's human population. The extraordinary increases of human numbers in these countries far outweigh the counterbalancing impact of declining population growth rates in Western European and similarly situated countries around the world.

Please consider that we are faced with a population explosion worldwide and the potential for population implosions in certain places on the surface of Earth. Of course, a population implosion will be dreadful for the people directly affected; however, the worldwide explosion of absolute global human population numbers in our time risks exposing all of the world's children to an unimaginably bleak future, the likes of which only Ozymandias has seen, I suppose.

Sincerely,

Steve

vital core said...

Aslak, What I'm advocating is what seems to be working in parts of Europe. 1) Generous maternity leave 2) subsidized or free child care 3) Financial support for families.

Several points:

1) I'm not aware of any government policies raising a modern people's TFR above replacement (after you back immigrants birth rates out, which have yet to fall to cultural norms). If I'm wrong, please educate me where this has occured. Heck, for every childless woman, another would have to have 4.2; tall order for Europe where most are childless by choice, not because they can't afford children.

2) Even if you could raise populations to replacement through the social engineering you propose, it wouldn't matter anyway except to postpone the inevitable. Breeding "just at replacement" doesn't do squat if only a single other tribe is breeding to maxiumum capacity, as the Romans found out from the Germanic tribes. Natural selection requires a species to breed until all hit a Malthusian trap, and we are nowhere near that right now.

3) In fact, it's far worse: we have an anti-Malthusian trap going on, with lots of resources and the poorest breeding like wildfire while the wealthiest go the way of the Dodo. At least some will continue to breed, because it is so genetically successful. A self-fullfilling reality: the future belongs to those who show up for it. It is indeed a childlike faith that all peoples, everywere, with extreme genetic diversity, will become modern and drop below replacement. This can be believed only in the absence of even basic knowledge of genetics and natural selection, that is, how the Selfish Gene works. Every species always breeds to carrying capacity. And many, even most, go extinct along the way. That's what we are seeing here.

SESALMONY@aol.com said...

Dear vital core,

You report,

"Natural selection requires a species to breed until all hit a Malthusian trap, and we are nowhere near that right now."

Given the size and make-up of the relatively small, evidently finite and noticeably frangible planet we inhabit, as well as the anticipated increase in human propagation, production and consumption between now and 2050, is it not yet possible for us to share the view that the "Malthusian trap" is in the offing?

Always,

Steve

Edward Hugh said...

Hi again steve,

"is it not yet possible for us to share the view that the "Malthusian trap" is in the offing?"

I'm not very convinced of Malthusian traps and all that stuff, I'm afraid. The Malthusian regime - which may well have characterised our species during the 10,000 years or so of agricultural society - started to come to an end with the arrival of the modern growth regime following the industrial revolution in the UK in or around 1782 (and of course I am not unsymapthetic to the idea that we may now be far too "hooked" on this growth thing, but I think that given the complexity of the problems which face us we may do much better if we take one step at a time here, and simply turning our backs on economic growth - even as the population pyramids invert in the OECD countries - would be really asking for trouble IMHO).

This growth dynamic is now very rapidly spreading itself across the planet via the global economic transmission mechanism. As I keep saying I imagine the last bastions will have fallen well before 2050.

Basically the Malthusian regime ends when the link between rising incomes and fertility is broken. The Malthusian trap worked - you will remember - since as people got richer they had more children.

Well, the modern growth regime has exactly the opposite profile, since as living standards rise the number of children people have falls. I would have thought this basic point was reasonably obvious when you look around the developed world.

Basically the modern growth and fertility regime started off in the UK, Sweden, France etc, spread to the US and other European countries by the mid 19th century, and is now finally spreading all across the planet. Dont' worry, the Gambia, Niger and the Democratic Republic of the Congo may hold out a bit, but they won't hold out that long, the force of this wave of globalisation is simply too strong.

So we come back to this point:

"The population of Western Europe and other regions where population growth rates are declining represent a relatively small part of the global human population."

Well look, the developed world may represent a small part of the total population, but they represent a much larger share of the total global wealth, so they really are rather strategically importnat.

If, for example we were to get generalised pension system meltdown across the developed world (a small possibility, but not at all impossible) this would most probably destabilise the whole global economic and demographic equilibrium (I mean I still am trying to contemplate what impact a sovereign default in Italy - which I see now as more or less inevitable over the next decade given their economic dynamic - will have, and if Japan then follow them, well watch out is all I can say). And it would destabilise them in such a way that plenty of people could easily be cast back into some kind of Malthusian trap, even if this only proved to be a temporary one.

In other words what I am arguing is that getting global population down to some extent depends on stability, and stability means equilibrating severe disequilibriums, that is what this blog is all about I suppose when it comes down to it.

Essentially what we see in the second half of the 20th century is that while one part of the planet was getting rich, the other part was getting loaded up with lots of children (who later would become potential labour forces and customers). This was really what neo classical economists call a "bad equilibrium" and the whole thing simply had to unwind at some point. As the current terminology goes we can either get a "hard" or a "soft" landing, and this is what the whole debate is about IMHO (since I think all reasonable thinking people agree we don't NEED 9 billion people, and we don't NEED accelerating climatic change, and we don't NEED resource depletion and ever rising food and commodity prices). The big question is how do we manage to avoid all those things that I think we can all readily agree we don't need without upsetting the whole damn apple cart. That I think is the real headbanger of a question.

Aslak said...

Edward,
You make a number of good points, but I'm just not convinced past trends is a good predictor of future trends. It is clear that without large-scale immigration the population of Germany will decline and increasing numbers of pensioner will place a heavy burden on society and economic growth. I think we agree on that much.

But I do believe that Germany is perfectly capable of responding to the crisis. German family policy is largely based on a patriarchical model largely thanks to the Christian-Democrat influence. This makes childbearing unappealing to women who want to pursue careers. We just don't know how Germans would respond in a French or Scandinavian environment. I would find it hard to imagine that the response wouldn't be positive, the question is just to what extent. I suspect we'll find out over the next decade or two as Germany moves in that direction, albeit not with the urgency that you and I would like. All in all, I remain optimistic about Germany although economic growth there will be sluggish. Of course, even in the best scenario, Germany would require a generation to regain demographic health.

VC:
1) I'm not that concerned with population growth per se. As I've stated earlier, I think a TFR around 1.9 is perfectly acceptable. Smaller populations would probably be a good thing.

2)3) I just can't agree with your thinking. People are not bacteria and don't actually breed mindlessly, or at the least people can be trained not to do so. Even Sub-Saharan Africa is making small improvements here. I'm also not sure how you foresee Europeans being overrun by Africans. A modern state, even in demographic decline, is perfectly capable of controlling its borders if it really wants to. (That is of course a big if)

vital core said...

steve, is it not yet possible for us to share the view that the "Malthusian trap" is in the offing?

I don't think this is possible right now.

I do agree with you that natural selection requires we will eventually hit such a trap, but with the cleverness of humans and our technology I certainly have no idea when this will be. All I can safely say is I see no sign of this trap where I live; nobody has gardens in their yards yet, they drive everywhere just for fun, eat rich foods, and have lots of water and whatnot. They could cut consumption 95% and still do just fine.

I do think it is very dangerous to try and guess when this trap would be and shift public policy in preparation for it. It seems so far that the free market has the best track record for setting prices and spotting shortages, so I guess I would trust the market to make the call when we need to cut back.


aslak, I just can't agree with your thinking. People are not bacteria and don't actually breed mindlessly, or at the least people can be trained not to do so.

We are not bacteria, we are apes, and all apes, everywhere, including us, follow natural selection. 40,000 years ago we killed off all the Neandrethals, and we have since been in genetic competition with each other all over the world. I don't understand how your vision of the world jives with science or historical reality, but I'm certainly open to any data.

I'm also not sure how you foresee Europeans being overrun by Africans. A modern state, even in demographic decline, is perfectly capable of controlling its borders if it really wants to. (That is of course a big if)

I agree completely with this - for a time. But why would they "want to"? It would be like the Great Wall of China; it might work for awhile, but eventually nature will take its course and the breeders will push their way in, or happen from within.

It's important to understand that modernity is so new that we should expect it to take time for humans to adapt to it. But sooner or later, as it has always occured in the past, some group within the low-breeder modern context will hit upon a high-breeding formula, if only by chance, and they will then dominate the culture. Surely this is obvious? That once this happens, those breeders will by definition take over? Assuming you are right and Africans become modernist (only a theory at this stage, many seem quite resistant) somebody will eventually will hit upon a breeding formula. This is natural selection. It's how genetics work.

Edward Hugh said...

Steve,

"There are many other countries worldwide where population numbers are growing much too rapidly, and these countries represent a much larger portion of the world's human population. The extraordinary increases of human numbers in these countries far outweigh the counterbalancing impact of declining population growth rates in Western European and similarly situated countries around the world."

I have been thinking about this a bit more, and I wouldn't want to give the impression that I don't think all of this is a problem, I think it is a HUGE problem. But this issue is now like closing the barn door After the horse has bolted.

The time to have really acted decisively on all of this would have been in the 1960s and 1970s, but then the ideas of Ester Boserup (which are basically fine as far as they go) were in fashion, and people thought that simply because we could feed everyone on one bowl of rice a day there wasn't going to be a problem.

People forgot that the income differentials were going to inevitably unwind at some point, and that we could be facing a planet of 9 billion people all wanting the sort of level of energy and food consumption that citizens of the US currently enjoy, and this is another ball game altogether, as we can see if we look at the sharp structural rise in energy and food prices which we are now seeing, and this may well now continue off into the future, with a transfer of wealth effectively taking place between resource rich and resource light societies.

Normally people had thought that some kind of "techno fix" would do the trick, but the signs are that the technical change at the present time simply is NOT keeping pace, otherwise we wouldn't be seeing such a large change in relative prices. So unless you want to believe that a new wave of technological revolutions is just round the corner -which it might be, but what sort of probability do we ascribe to this, since equally it might well not be, and do we really want to place all our eggs in one single basket where they could get so easily broken?.

But the tragedy is, as I say, that we should have been doing something to avoid all these imbalances back in the 1970s. But then - in all fairness - we simply couldn't see. I don't think anyone really understood the dynamic of what was happening, and now we are left picking up the pieces, though now we can (or should at any rate) be able to see things a bit more clearly.

Most of the big surge in population we are going to see is already built-in, since it is largely to do with momentum and the fact that you cannot easily drop fertility from 7 to 2.1 in a couple of years.

So we are faced with a sort of fait accompli, and have to make the most of what we have.

The German philosopher Hegel - appropriately enough for this post - said that "the owl minerva flys only after dusk", by which he meant that we have a congenital weakness insofar as we only wake up to issues when it is already too late (the SIV issue in the current credit turmoil being only the latest example of this), when things are going well we seem to have an inbuilt tendency only to see the upside.

Doubtless some of those Evolutionary Psychologists that vital core is probably interested in could explain how during the several million years before the agricultural revolution when our ancestors were genetically "formed" there was some sort of selection advantage or other associated with this kind of selective blindness. I don't know, but what I do know is that it is a considerable disadvantage when facing the kind of complex "post modernity" we have today.

So while I fully agree more should be being done to help raise awareness in high fertility societies about the importance of reducing fertility, and surely more resources should be invested in raising rural female education levels which seems to be part of the key, I think by and large this problem is on its way to resolving itself, in part because I tend to agree with viatl core that the kind of free market mechanisms of capital flows towards the devloping world and labour migration towards the developed one may well be the most effective way to balance things up in the shortest possible time, simply "let those rivers roll".

The other problem though - the one that Claus and I are interested in - about the economic dynamics of lowest-low fertility societies is poorly understood still (even by us), and therefore on a simple division of labour principal I would argue our (finite, all too finite) time is better spent on this part of the problem at this particular moment in time.

But this doesn't mean we don't say "more power to your elbow" to all those who wish to tackle the problem at the other end.

Vital Core

"but with the cleverness of humans and our technology I certainly have no idea when this will be. All I can safely say is I see no sign of this trap where I live; nobody has gardens in their yards yet, they drive everywhere just for fun, eat rich foods, and have lots of water and whatnot."

I'm not sure where it is exactly you live, but if we start to look at the case of the United States then I think that the era when this was the case is now arguably coming to an end, since both energy and food are getting to be more and more expensive and techology at the present moment just doesn't seem to be keeping pace.

I cannot help noticing that a lot of the female americans who have posted on this blog over the years have mentioned the omnipresence of cars and the availability of living space as factors which may help explain why mums in the US have been prepared to have more children than say mums in Japan have.

Well both of these "pluses" may well be hit by the changing relative energetics which underlie our societies. Basically space and distance may well be seen differently over the next half century, and the if the above mentioned factors have been in any way important in explaining some of the higher fertility in the US then the change could easily have a negative impact. Just a thought.

Edward Hugh said...

Vital core:
"All I can safely say is I see no sign of this trap where I live; nobody has gardens in their yards yet, they drive everywhere just for fun, eat rich foods, and have lots of water and whatnot."

Fortunately, it seems, you do not need to shop in Wal-Mart:

Rice advanced above $25 for the first time as Wal-Mart Stores Inc.'s Sam's Club warehouse unit restricted purchases of some types of rice in the U.S.

The cereal, the staple food for half the world, has more than doubled in the past year as China, Vietnam and India curbed exports to safeguard domestic supplies. Sam's Club limited customers to four bags of jasmine, basmati and long-grain white rice per visit in all U.S. stores where allowed by law, company spokeswoman Kristy Reed said by e-mail.
Bloomberg yesterday

Don't worry, I'm not getting alarmist, I don't think we are all going to face food shortages tomorrow or anything, but I am underlining that I do think Steve has a point, and that we may all be more inter-connected then we sometimes like to think. I found this researching for a longer piece I am doing on the resource issue and demographic changes.

Talking of water. I am in Barcelona, which is more or less "first world", and we are facing having water supplies coming by boat and train so the tourists can have showers in the summer (the showers on the beaches are already cut). And the gardens are rapidly being turned into patios, since you can't water the plants.

And thank god most of those newly built second-home holiday complexes are still lying empty due to lack of buyers following the mortgage crunch - since there is no water for the swimming pools that go with the flats they contain :).

I mean we are a long way from crisis dimensions evidently, but, for example, if we had more water we could put a lot of the displaced construction workers back to work in agriculture, but as things are I just don't see how that is going to be possible.

China also has to import rice because of underlying water supply problems, which is perhaps a little more important than the dry shower in the Barcelona hotel room I guess.

SESALMONY@aol.com said...

Dear Edward Hugh and Friends,

Thanks for your comments and for this opportunity to communicate openly about what to me looks like the proverbial "mother" of all global challenges: the human overpopulation of Earth in our time.

It looks like humankind inhabits a tiny celestial orb that is miraculously set among of sea of stars. As far as we know, life as we know it exists nowhere else in the Universe. In the light of these one-of-a-kind circumstances, perhaps we of the human family have the responsibility of assuring the security for the future of life in our planetary home.

I am trying to focus attention on the pressing need for human beings to protect and preserve the finite resources of Earth and its frangible ecosystems. If we fail to achieve this goal, then an unimaginably bleak future could await our children. In all the seriousness of what could be somehow true, I mean the children of my generation.

If 6+ billion human beings live on Earth now and 9+ billion are expected to populate our small planet by 2050, then the human species simply cannot keep engaging in certain unbridled activities that we can see overspreading the Earth because the Earth has limited resources upon which all forms of life and human constructions like national economies utterly depend for existence. Without adequate resources and ecosystem system services of Earth, life as we know it and human institutions could collapse, I suppose.

Now, some portion of the world’s human population conspicuously over-consumes the resources of our planetary home. Other people, working in huge multinational conglomerations, are operating businesses in a way that recklessly scours the oceans' floor, decapitates mountains, turns biomass into human mass and, in these and many other ways, end up dissipating natural resources at such an alarming rate that the Earth has insufficient time to restore the resources for human benefit. Still other people in the family of humanity are overpopulating the planet. The leviathan-like scale and rapid growth of global human consumption, production and propagation activities are putting the Earth, life as we know it, and the human community in grave, clear and present danger.

Human beings of the overdeveloped world, of whom I am one, are among the people in our planetary home who are ravenously over-consuming Earth's resources. We could choose to consume less. People in the developing could choose to limit overproduction of unnecessary things, to stop ravaging the planet, and to contain industrial pollution. People in the underdeveloped world could limit their number of offspring. Perhaps these are some ways the family of humanity begins to respond ably to the human-induced global challenges that loom so ominously before humanity in our time.

While I certainly agree that action should have been taken by my generation of elders when we were young in the 60s and 70s, still we have responsibilities to assume and duties to perform, here and now, for the sake of our children, grandchildren and coming generations.

The idea of making a conscious choice to do nothing in the face of the recognizably daunting global challenges that are visible before humanity on the far horizon is anathema to me.

At a minimum, do we not have a "duty to warn" others of the potential for some kind of ecological catastrophe if the human community adamantly chooses to continue relentlessly down the current "primrose path" marked by soon to become unsustainable consumption, production and propagation activities?

Always with thanks,

Steve

Paul C said...

I tend to agree with viatl core that the kind of free market mechanisms of capital flows towards the devloping world and labour migration towards the developed one may well be the most effective way to balance things up in the shortest possible time, simply "let those rivers roll".

I would be wary of this sort of reasoning. While the market is very good at some things, it's bloody useless at other things. I'm not advocating aggressive government involvement in these issues - frankly, the track record of governments on population concerns doesn't make for happy reading - but I do think that leaving it to the market will not lead to the outcomes that most people on this thread are hoping for.

Anonymous said...

CIA 2008 TFR estimates recently published, FWIW:

https://www.cia.gov/library/publications/the-world-factbook/rankorder/2127rank.html

How reliable are these data? It would seem these figures are fairly consistent with last years'. The general trend in LatAm is a slide toward replacement and below. India is down to 2.76. Below replacement there within a decade seems fairly likely. The "world" is at 2.58, which I believe is the same as last year.

Edward Hugh said...

"How reliable are these data?"

Well the CIA material is basically based on data which is compiled by the US census bureau, so they do not, as it were, do their own calculations.

US census bureau data normally differs slightly from the Population Reference Bureau data, since the latter normally simply gathers and publishes the nationally compiled data, whereas demographers at the census bureau seem to make their own (good faith) estimates of the accuracy of this data. I have no idea of the methodology they use for this.

Basically all demographic data is far from beimg 100% reliable, and needs to be treated with caution - again likie inflation-basket data I guess. And accuracy surely varies from one country to another.

And remember that TFRs may be more or less reliable as an indicator depending on the rate of birth postponement that is going on in a country. But TFRs do give you a rough and ready rule of thumb, and the differences between the US census bureau and PRB are details rather than big picture stuff.

"The general trend in LatAm is a slide toward replacement and below."

I am sure. Fertility of Mexicans in Mexico is now below fertility of Mexicans in the US. Argentina, Chile and Brazil are pushing down towards below replacement or are already below (depending on whether you go by the PRB or US Census), and the only countries hanging out to some extent are Peru, Bolivia and Ecuador (columbia seems to be in betwee), but yes, by 2020 everyone except perhaps Bolivia below replacement I guess.

"India is down to 2.76. Below replacement there within a decade seems fairly likely."

The big difference in India is between North and South, so the number is a bit like the global average, ie it doesn't tell you too much, except that total fertility isn't THAT high at this point (ie most of the growth we are getting is a momentum question).

In the North - Bihar, Uttar Pradesh etc - tfr is certainly over three, and may well be in the 4/5 range, while in Tamil Nadu, Karnakata, Kerala in the south fertility is well below replacement (apart from that of the Bengladeshi migrants who are entering quite rapidly to fill the gap), and may well be closing in on the 1.2 lowest low range, which is what I would expect from what we have seen in other parts of Asia.

Edward Hugh said...

Paul,

Hi again, and sorry again, but just to clarify:

"but I do think that leaving it to the market will not lead to the outcomes that most people on this thread are hoping for."

I am not really suggesting we should simply leave everything here to the market. I am simply trying to say that since the whole multilateral policy apparatus is so slow to react, and doesn't anyway seem to understand the significance of the issues involved, I have little confidence they are going to be quick footed enough here.

I think we need to distinguish between the high fertility problem and the low fertility one. From what I can see market forces do now seem to be starting - thank god - to straighten out some of those huge imbalances in wealth and access to resources which have built up in the very high fertility societies over the years, in the sense that a large scale development process has been set in motion, and this will, I think, bring down fertility all over the place quite quickly. It may seem like a bizarre, even perverse, result, but it does seem to be happening (see eg my latest post on food), although of course it is the poorest poor - Haiti etc - who have (surprise surprise) the highest fertility, who are getting hit the worst in the short term.

On the other hand I don't think market forces will do anything to straighten out the low fertility problems that countries like Germany, Japan and Italy have, since they are stuck in some sort of "bad equilibrium" or other (and there is no "market forces" correction mechanism), so left alone the situation will only deteriorate further, and we surely do need to see some large policy initiatives here.