Thursday, March 09, 2006

Birth Predicament Race

A concern that is driving more to the fore in Europe is the falling birth rate. In Europe a birth ratio of 2:1 for western economies is considered to be the population replacement level. This table shows the mean number of children being born per women (2004 figures)

Ireland 1.99e Netherlands 1.73 France 1.90 Germany 1.37 Norway 1.81 Italy 1.33
Sweden 1.75 Spain 1.32 UK 1.74 Greece 1.29
Source: Eurostat

These figures appear to indicate that these countries are going into a population decline and from this it is extrapolated that a number of problems will arise. Problems that relate to having an aging population, an insufficient indigenous workforce, taxpayers, pension contributors and of course nothing to do with having a diminished numerically military ability. This population fall is not taken as an opportunity to develop a manage population or have it linked to a managed economy. It is seen as being a negative development and it maybe eventually seen as an opportunity missed. Instead it is displayed as a potential handicap not conducive with the desire to keep ‘expansion’ going. More workers mean more consumers to pay taxes, less worker/consumers means a drag on the states and could be trouble.

Some commentator and articles have suggested that a high birth rate promotes a vibrant and expanded economy and point to the USA, China, and India as an example of what an expanding population via birth rate can do. As the population expands they generate more resources for the economy, pull in or generate greater investments and create a power base that is self-sustaining. The two arguments are in essence, that a growing population is a good thing, stimulating the economic drivers to supply it, as in the case of USA, China, & India and a falling population, (as in a drop in the birth rate), shows up in a flagging of the economy, as in the EEC. It is also proposed that with these growing economies that have a high birth rate, they may be responding to a measure of social and economic confidence, i.e. as wealth flows in or is expanded peoples ‘inclination’ to have more children is increased.

Superficially the two points of view seem to me to be a bit of a chicken and egg scenario. The view taken in looking at the birth rate issues and how it affects the economy only seems to consider that a ‘replacement ‘ level in the population of 2:1 relates to a desirable economic stability, albeit in an expanding environment. With any figure less than this ‘replacement figure’ the political and economic suggestion is that steps should be taken to redress a balance.

The reason why there is a fall in EU birth rate compared to others is exactly uncertain but it has been rehearsed as relating to a number of factors such as: -
Contraception, rising female participation in the workforce, the media indoctrination preference of smaller families, women no longer prepared to dedicate their lives to childbirth or rearing large families and high individual consumerism expectation. There is some evidence that addition factors are in play and that one has to do with the fertility level in men; this also seems to be reducing, due some say to the increasing level of chemicals being consumed in foodstuffs and possibly the aggregate effect of creeping sterility. The other factor says that the later male / females delay in having children, the greater the chance of not conceiving and this has a back loading effect on the production of sperm and fertility – use it or lose it – and this leads onto a fall in the fertility of the next generation.

The decline in the European birth rate is a recent trend with as yet very limited serious reason to attempt to address it other than noting that it is occurring on a European scale. Only France seemed the want to take corrective action and even France's generous financial inducement to having larger families is having only a marginal impact. Although much is said (in the UK) on the need to support families and working parents with child care, paternity leave, baby bonds, etc it is still considerably cheaper, easier and quicker to import the population increase than home grow it. However immigration without integration will lead to serious social strife when an economy turns down.

I think with these views on why the birth rate is falling and its effects, some very important elements are missed.

It could be that the reason why there is falling population in the EU and a rising one elsewhere hides a more sombre outlook. In any economy driven by market forces philosophy, there is in my opinion a natural balance to be achieved and this I relates not only to the replacement level of population but also to the social economic pressures that could effect all mature economies. It is linked to the idea of resource availability and collective mood psychology. As resources become plentiful and readily available at an economic cost to users, without external or internal exceptional controls such as war or pestilence etc. the population will naturally expand to fill the resource flow. This could be seen in industrial or early post industrialised systems.

As society and the economy matures and resource become cost volatile consumerism dictates a selfish life style. Should resources become scarce or restricted the mature population tend to conserve disposable income and the breeding population adopt a survival trait slowly re-evaluating their life choices. In the first instance the demand is to maintain a good standard of self and consumerism. This can then be reflected in a rise of independent living. A maintenance of separation of resources – i.e. not getting married and choosing not to or delay in having offspring’s to an affordable time when it may be too late to do the reproductive job.

In some ways in the last four-decade the quality of working life and disposable time has deteriorated with increase dissatisfaction in the working environment, higher imposed stress and the need to travel further to the employment place that is taking longer. At the same time incomes have increased and provide a higher standard of living, in consumer terms, that is not reflected in ‘satisfaction’ surveys. Up to the 1960s the male was predominantly the main labour fodder and main family earner. What earnings they did have paid for all consumable for the family, including children – on a single income. Today it takes two incomes to maintain the consumable life style and children. In addition the stress of employment tenure confidence has become harder as the economic drivers seeks more asset control, greater profit with less producers.

In a very profound way the young of today are worse off than in earlier decades. As work plays a greater impact on females and males lives than before and they have much larger choice in consumerism, they seem to have less time for social responsibility guidance towards children yet require more resources to meet obligations. The drive for greater productive output with less labour content creates uncertainty in the ‘post industrialised zones’ (with the prime manufacturing & services being eroded) and the high cost of family maintenance impinging on consumer ability with a comfortable life. Anyone now up to the age of 80 will have seen the birth and demise of the social contract, employment assurance and society trust, moving back to the days of self help and resource independence. It appears that the people that have gained most from the universal help are now dismantling it. To the extent that anyone up to the age of 40 cannot be certain that the state will promote a safety net for them as they get older or hit hard times. It is these uncomfortable life pressures that are dictating the drop in population.

Although economies may increase the wealth generation in a unregulated market economy, it usually flows into the hands of less people and as the production process flows out it leave behind a temporary large serviceability void that requires labour to resource it at traditionally lower (cheap) cost giving rise to the high level of ‘mac’ type jobs, further generating disinclination to take on a family. It is no longer true that ‘two can live as cheaply as one’.

The demand for more births is driven by the issues of labour fodder, tax and pension gap etc. The state (especially the labour party) is promoting the idea of filling the population gap, by immigration and encouraging many more people to become economically active i.e. less retirees, less labour disability, less social support.

But the issue in a post industrial, post service era, is what employment is or will be available and at what cost? As a society matures and develops a greater cultural equality and cohesion, it aught to provided for all citizen a social safety net, as is the case now in the existing EC. A mature culture that encounters strong market competition and sees most of its production processes that required heavy labour content being sucked away to the cheaper labour markets, often with a high disposable population that does not have the organised universal social infrastructure, may, in the short term, benefit from the cheaper consumables and low inflation but this is just a short respite before the real entrenchment begins, less quality jobs, eroded incomes and an affect on cultural cohesion.

The reason that the emerging economies seem to be doing well at the expense of the ‘mature economies’ and are growing quickly could be due to them not having a corporate civil structure of responsibility, no or low social infrastructure, large discrepancy of wealth spread where life is cheap to create with a low subsistence take and multi-nats market manipulation.

In looking at the replacement rate it has been noted that the main contributors to it are not the long-term indigenous resident but the newer members. This is a pointer to why one sector of a culture multiplies and why one does not, and I do not think that this has anything to do with family values but more to do with the perception of resources provision, availability and use. This trend has been particularly noted in the USA, as assessed by a census, were the replacement level is about 2.0, an improvement that is a dramatic increase on the previous census. This increase in birth rate is thought to be due to the success of the USA wedded to the philosophy or market forces and free market economy, its large influx of immigration and its social confidence in the economy. The birth rate increase has been observed to suggest that it will lead to some states soon to be dominated by hispanics / mexican / black related immigration resident, overtaking the wasp majority.

This population increase creates issues related to the economic drivers that will affect the standing of america, india and china. It is assumed that with a growing large vibrant population that those countries with growth in population will be in a stronger position to dominate the world markets as producers and consumers; this is likely to be nonsense. With the huge difference in social structure, cultural, economic permeation and spread, if the population are denied to be economically active, not participating in the wealth generation, not socially supported, or form a marginalised majority, it will likely implode.

Funding the expanding population would appear to rely on wealth generation and keeping the economic generators working at the most profitable cost i.e. to compete with any country that has labour fodder advantage must eventually cheapen the higher incomes zones, or exclude from the benefits of economic growth, some element of their expanded population. It is assumed that keeping ahead of the economic race means also investing in higher value technologies and skills that will find consumers in the ‘developing economies’. This can only ever be a short term strategy as the developing countries grow at a rate that is faster than a 'developed' one as their own economies expand; with the resources being paid over to them by the richer nation, (via imported goods etc) they then develop their own services and hi tech consumables.

Any country that relies on the economy of another country to provided cheap resource exploitation to aid its expansion and allows a burgeoning population growth will be similar to the effect of a tidal surge, (the economy) when the surge has no where to go it gets overrun by the following waves (the population) This will create huge dislocation until a new level of stability is achieved. Some elements of the right political wing and corporations want to see more immigration to feed a labour market, keep waged down, produce babies, pay tax etc. Those people that want to promote the open boarders movement and high immigration will not be the ones to suffer the financial consequences.

For seven thousand years civilisation have come and gone, it is assumed that it is known some of the reasons why this had occurred and it is possibly less likely to occur now with the greater spread of information and technology but there is no evidence to support the view that saps now are any smarter or intelligent then in the past. Saps know more thing, have access to more information, have greater use of power but they will face the same resource usage problems that others did and although today they are perhaps better placed to tackle problems, with the joint effort required of discordant interest to address the issue, they are unlikely to choose to do so. Although all mature economies will eventually suffer population shrinkage by those people wanting to protect their individual status, this is not so for those who have no stake in the economy but will breed. It is the make up of the population and resources shifts that are likely to be one element of the disastrous impending predicament.

Renot 28.1.06

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