"In his 2014 book Bending Adversity, Pilling grapples with the cognitive dissonance at the heart of 21st-century Japan: is it a harbinger of global stagnation? Or is it a model of global sustainability? In the book’s most-quoted passage, a British MP, on arriving in Tokyo in the early 2000s and surveying its lively environs, is reported to have said: “If this is a recession, I want one.”
I think it's good. We don't need more people on the planet. We need to build sustainable populations and economic models. Growth! Growth! Growth! isn't needed right now. It probably won't be needed unless/until we move people to live on Mars.
Growth is the very thing that is needed; prosperity stops population growth. The pattern is clear; nations that have enjoyed high rates of development through "Growth!" (US, most of W. Europe, Japan, etc.) have stabilized their population. Nations that have not continue grow their population, at excessive levels in some cases. Hating on "Growth!", while fashionable, is exactly the wrong approach.
So following this reasoning, the entire continent of Africa, most of Asia, and most of South America should have massive amounts of people so they can reach prosperity?
Sorry. Not buying it. Growth is an ok thing as it happens, but as populations increase demand for resources such as land and water produce pressures that only get worse with more people. There's a reason you can sell a parking spot in Hong Kong for half a million dollars but can buy a lot of land in Canada or something for next to nothing. China was wrong to stop the 1-child policy. I'd like to see it implemented globally. Along with that I'd like to far reduce immigration to the United States (I'm just using the US as an example since I currently live here) as I don't want to see the population continue to grow. In the long run, population growth is good for me as a property owner and somebody with wealth, as prices on things like water and homes won't affect me, but I'm not selfish and I want people to not have to struggle to obtain basic resources or housing.
So following this reasoning, the entire continent of Africa, most of Asia, and most of South America should have massive amounts of people so they can reach prosperity?
I don't think that's what topspin said. Topspin said prosperity stops population growth. Topspin did not say that population growth causes prosperity. "Growth!", as topspin puts it, is not the same thing as population growth. it's my understanding that as peoples become richer, they have fewer children [1]. That's the cause and effect I believe Topspin was highlighting. Having fewer children does not cause a people to become rich.
Sure. I didn't interpret it that way but that's fine. I still think we need fewer people and we really need to find a way to get something like the 1-child policy reimplemented in high growth areas. Especially if we're going to sit on our hands with respect to global warming. An increase in the number of people leads to an increase in the consumption of resources. Unless we're adding more people that produce more resources than they consume, we're causing a problem with a sustainable civilization. We need lower numbers of people concentrated in different areas, and much more of the planet returned to nature and to be used for mining, natural parks, sustainable farming, and entertainment (skiing etc...). Going to the national parks is already getting more difficult each year. Home prices aren't going to go down unless something bad happens, as more people move in. The price of water is already artificially low. I could go on and on.
And to add, it's a problem that wealthy people aren't having children, because they are in the best position to educate and provide for them.
First, we don't need more mining, we need much less, preferably zero. We've extracted enough resources from the earth's crust, and mining has a huge environmental toll. We should be doing a far better job recycling, and we should be getting the rest from asteroids or the Moon. (I'll make exceptions for some things which are literally as common as dirt, such as silicates/sand/etc., though even here there's some problems with overconsumption.)
More people don't necessarily need to consume more resources. We should be living more sustainably, with less consumption per person. Living the way a typical suburban American lives is totally unsustainable, and grossly wasteful. We need to have smaller habitats in large, shared buildings (i.e. we should be living in urban high-rises, but well-built ones, not like those crappy ones in the UK), and we shouldn't have personally-owned vehicles, and instead should be using SkyTran PRT to get around quickly and cheaply with very low energy usage. Note that I'm all for the option of ownership of those housing units, just that we need more condos and fewer standalone houses; renting property has its own set of problems.
As for home prices, the main problem there is that investors are allowed to buy residential property. Ban that, and especially ban ownership by foreigners, and that'll fix that problem quickly. Housing prices have been inflated because of too much "investment" by various moneyed interests, such as wealthy foreigners looking for stable places to park their money outside their own country. This isn't helpful to the people who actually live in a place, as they're now competing with a huge number of outsiders (both inside and outside their country) when bidding on a housing unit to buy. This phenomenon simply didn't exist in the US a few decades or more ago. Vancouver Canada I believe recently enacted a law penalizing house owners who didn't actually make use of the house, as so many houses were sitting empty, owned by Chinese investors.
As to wealthy people having children, that's a non-sequitur: wealthy people are such a small portion of the population that even if they all had 6 kids, it wouldn't make a detectable difference. It's the middle class that you want having kids.
> First, we don't need more mining, we need much less, preferably zero.
I don't disagree. We will have some mining forever though, whether that's here on earth or elsewhere.
> We should be living more sustainably, with less consumption per person.
I hope I didn't give you the impression that I think the opposite of that. I am all for sustainability. Including population sustainability.
> As to wealthy people having children, that's a non-sequitur: wealthy people are such a small portion of the population that even if they all had 6 kids, it wouldn't make a detectable difference. It's the middle class that you want having kids.
? I want fewer kids and fewer people. I want those with the means to (rich or upper middle class) to have kids, at least until we get the population of the planet much lower. So yes, a small amount of people having a few kids isn't a non-sequitur at all.
> No POVs
Dude/dude-ette... you should read my posts! I'm all for that :)
>We will have some mining forever though, whether that's here on earth or elsewhere.
Yes, of course; the need for raw materials is never-ending. I just want mining on Earth to mostly stop, or at least be done in the most environmentally-sustaining way possible. Moving a lot of mining offworld would accomplish this.
>I want those with the means to (rich or upper middle class) to have kids
I'm not so sure this is such a great idea. Rich people can already have all the kids they want; it's not like financial concerns are holding them back from it. And I don't see how they're going to do a better job of it than regular middle-class people; in fact, rich people generally seem to be much worse and more sociopathic human beings, and their kids frequently come out awful--look at Paris Hilton for instance. I don't see why we should be encouraging them to have more; we don't need more sociopaths in the world. And again, there's so few wealthy people it wouldn't make a significant difference.
Sure, so what's good about this is if we limit reproduction to those with the means to provide, then will be able to reduce the population. You mentioned "won't make a significant difference" and like, yeah that's exactly the point. If they are having only a few children and then nobody else is having kids, we'll shrink the population.
I actually disagree a little bit. I think too many people could possibly drive demand for more development in space. Instead of Mars, what we really should be doing is mining the Moon and the asteroids, and building gigantic rotating space stations. Theoretically, we could house a nearly infinite number of people that way, with artificial habitats optimized for human living unlike the planet we're on now.
Population stagnation could potentially lead to worldwide cultural stagnation, which would result in humans never getting off the planet and eventually getting wiped out somehow.
> Population stagnation could potentially lead to worldwide cultural stagnation, which would result in humans never getting off the planet and eventually getting wiped out somehow.
I understand the population piece, but I don't understand the cultural piece. Japan has stagnated, and it's clearly culturally vibrant. On the other hand, the United States brings in immigrants and is growing, yet I'm constantly scolded and reminded that I have no culture since I'm just a white person.
Oh, and back to the population piece. We're approaching 8 billion. How do you feel about, say, 3-4 billion? I mean, it seems like that's a pretty good number of people to get things done. We'd have less people doing menial work (or not working) and we'd have more essential and necessary work, wouldn't we?
Are there any studies of the effect of falling population on the capitalistic model? It seems that much of our assumptions about the incentives of inflation, interest rates, etc. presume a slowly increasing population.
I'm also interested in this topic. Most European countries, esp. the new EU members have very bad demographic outlook. I'm really interested in what may happen next.
As another comment points out, GDP can increase even as population declines, thanks to robotics and automation which make each worker more efficient. Demand for real estate (housing) is the wild card -- does it fall broadly (as one would expect) or does it bifurcate into desirable urban areas (where prices continue to rise) and undesirable rural areas (where prices continue to fall)? In other words, even as absolute population shrinks and there is theoretically more room, do the remaining people spend all their resources trying to crowd into the same dense urban areas? So many other industries key off of housing that this, to me, seems like the cornerstone question to answer when predicting what the future economy looks like.
i have always theorized that a population decline first yields a boom, and then a strangling almost impossible to end bust to follow.
I imagine it like this, say everyone but you died. you'd have all sorts of crap, you would virtually have anything you wanted. but with no people to make food, stuff, medicine, keep things running, eventually you have virtually nothing.
I have always believed the great depression was the result of a population decline from ww1 and Spanish flue that lead to the roaring 20s, followed by a bust that was only put to a close by the end of ww2
That's an interesting idea. Basically, availability lags production. Which makes sense when you consider things like stock distributed in stores and warehouses. So when you have a large, relatively sudden population drop, there's a glut of availability before the production drop hits.
Because after everything starts rusting and decaying, you're left with just what you're able to maintain as an individual. Which is to say, you'd be approaching iron age technology after, say, 70-80 years.
There'd be plenty of metals all around, but, without a technological society to maintain them, almost all machines will have decayed beyond usefulness by that point.
There's a strong benefit from division of labor and economies of scale that would bite you HARD if you're all by yourself.
Anti-globalism and population decline together would slice and dice up useful populations to the point where you'd get strong negative productivity curves as time went on.
Slight population decline combined with increasing globalism and automation isn't too bad. Until you get to the point where you have an incredibly aged population. That starts to bite hard as it still takes people to take care of the elderly. So either productive people have to spend their time primarily taking care of the elderly (instead of inventing things and building things and growing the economy) or the elderly go without care. Neither are very good.
If we get increasing and arbitrarily good automation and AI, it's not so much a problem. The robots take care of the elderly, and human beings gradually decline in population to be replaced by sentient AI. But I guess that's still a problem if you don't want humans to become extinct.
You may not have experienced overpopulation. There is a point beyond which negatives outweigh the positives. Many people in the Old World feel they would like to live with more space between people. One person left is not a useful extremum to consider, but population declining to early 20th century levels is arguably good for everybody.
It is population growth speed that hurts the third world most as the population increase to fast for development to keep pace.
But overall high population is a big problem people in the western/first world use atleast 10 times the electricity per person compared to the third world. First world population is 1 billion third world population is 7 billion. Similar is for other resources as the economic situation improves for these 7 billion they will put larger strain on all resources which are finite.
Funny that isn't it. It's almost like the Japanese have invested in robotic automation, high quality public infrastructure and using older people to best advantage.
Wouldn't you expect GDP per capita to grow as population shrinks? Why do you say "and yet"? The top 10 countries by GDP per capita are all small or tiny.
You would only expect that if the shrinkage is entirely in non-productive members of the population -- unemployed, retired, etc. If population is shrinking at random, you would expect the GDP to also drop at a similar rate as productive members are removed.
I certainly didn't, if that's your implication. Population decline due to low birth rate is mostly going to be on the tailing end of population age. You would expect tailing-end losses should generally skew towards retired non-productive members.
However, that's not the only way to get population losses. Epidemics would be probably be skewed on economic indicators -- Lower class -> higher density -> higher infection rate. War would be skewed towards younger ages -- recruited soldiers in that 18-25 bracket that are on the front lines.
Different causes will have differing effects on the population and different expected effects on GDP. You can't just generalize it to, "Wouldn't you expect GDP per capita to grow as population shrinks?" Which is what the original comment I replied to did.
> Population decline due to low birth rate is mostly going to be on the tailing end of population age. You would expect tailing-end losses should generally skew towards retired non-productive members.
I don't follow. Population decline among old people is due to death. Population decline due to low birth rate occurs at the opposite end of the age spectrum, among babies. Those losses start among unproductive children and mature over time into losses among productive young workers.
The population curve will eventually skew, but that's not indicative of where productivity losses are happening. You don't count people that weren't born in productivity, then call it a loss. You lose productivity when a real person loses the ability to produce.
Population decline from low birth rates occurs in people that weren't born. If you segment the population by age, this will be obvious -- compare the population figures to the same figures for the hypothetical situation where birth rates are higher, and you'll see that the numbers that are lower in reality than in hypotheticality are those for the young segments. Old age groups won't decline from low birth rates until all younger age groups already have.
And from the perspective of losses to GDP, this is what's relevant. If birth rates decline starting in 1960, that has no effect on the population of people who were born in 1930. Their contribution to GDP will be just as it was always going to be. But the cohort born in 1980 will be much less productive, because it is smaller than it should have been, and that shows up in 2000 as a loss of young workers (compared to predictions), not old workers.
> You don't count people that weren't born in productivity, then call it a loss.
You do if you're arguing that losses to GDP are explained by lower birth rates.
I agree with everything you said, except for the one axiom you state that everything else relies on:
"But the cohort born in 1980 will be much less productive, because it is smaller than it should have been, and that shows up in 2000 as a loss of young workers (compared to predictions), not old workers." (Emphasis mine.)
What defines what a group should have been? Predictions. But I've never heard of anyone calling a wrong prediction "losses" or "gains" before. If I'm predicted to sell a million units, and I only sell half that, did I "lose" half my sales? If a stock is predicted to go up a point, but goes down a point instead, did it "lose" two points?
Comparing what materialized as reality with predictions is a perfectly fine thing to do. But differences between the two are just wrong predictions, not gains and losses. You just simply can't lose something you never had.
You've gotten hung up on the word "losses" without understanding the perspective that shows them.
We're talking about a decline in GDP related to a depression in the birth rate.
Imagine a society in perfect stability. Every year there are 50 people in their 20s, 48 people in their 30s, 45 people in their 40s, 41 people in their 50s, and 15 people over 60 but not yet retired. Every year, people die, causing the kind of "population losses" you're worrying about in your comments to me, but this causes no population losses or shrinkage of the kind you're talking about in your earlier comments, because those deaths are balanced out by an appropriate birth rate, keeping the population constant.
Now the birth rate drops. 30 years later, there are 30 people in their 20s, 48 people in their 30s, 45 people in their 40s, 41 people in their 50s, and 15 people over 60 but not yet retired. The economy has lost 40% of the age 20-30 worker demographic (it did this over a period of ten years, but still). It has lost 0% of the age 30+ worker demographic. We asked the question "are population losses randomly distributed over the population, meaning that GDP per capita should stay constant?" and we see that the answer is no. We also asked the question "are losses concentrated among older, unproductive retirees, meaning that GDP per capita should rise?" and we see that the answer to that question is also no. Losses are concentrated among the young, which means that GDP per capita should fall when those losses age into the productive segment of the workforce. (And then rise back to exactly where it once was when those losses have aged all the way through the population, including the population of retirees.)
I must say again, if we want to explain (1) a loss in GDP (the number has gotten lower) by reference to (2) a loss in the population generating the GDP (again, the number ["population"] has gotten lower), which is (3) attributed to lowered birth rates, THEN (4) the loss in population (in the sense of point 2, where we said that the population declined) has occurred among the young, not among the old. It's not even necessary to use comparisons to a hypothetical reality to perceive the losses; the bare fact that the population was once larger than it is now is a perfectly conventional interpretation of "population loss".
You keep attempting to avoid the fact that you must tie losses to a specific entity being lost. You lose productivity because a specific person is no longer being productive. It's as simple as that. In the case of low birth rates, you are getting productivity losses at the tail end. That's where specific productivity is being lost. Where you seem to be getting tied up is that normally that loss would be offset by gains of new productivity -- a 100% or greater population replacement rate, aka a growing population.
Think of it like accounting for stock at tax time. You can't just "sell stock". You have to sell a specific stock that you bought at a specific time for a specific basis. And if you had a loss on that sale, it is immutably and forever a loss. You can, however, offset a loss by selling a different stock for a gain.
> You keep attempting to avoid the fact that you must tie losses to a specific entity being lost. You lose productivity because a specific person is no longer being productive. It's as simple as that.
This is a delusion that exists only in your own mind. You don't have to account gains and losses separately; most of the time you want to net them out, because you only care about the difference. Net losses are still losses -- that's why they're called "losses".
Think of it like accounting for mutual fund shares on an average cost basis.
It's fine to talk about net gains and losses. But you keep talking about those, while at the same time attributing the losses to a lack of young people. But that's not where the losses are coming from. There may have been gains predicted there that didn't materialize, but that's still not where the actual losses are coming from.
You want to talk about average cost basis, but then you keep saying that you lost money because investment X only gained +$Y instead of +$(Y+Z). Which is wrong. You lost money because you had other investments that lost money. Investment X gained value; it just wasn't enough to offset those other losses.
That a natural thought, but there are several complexities that make it unusual (possibly even unlikely):
For instance, infrastructure is a fixed cost. All the investment into roads, power grid, rail, airports, waterways, etc is now spread over fewer people.
Since public projects are usually debt funded, that usually means that fewer people have to shoulder the same debt burden.
When more of a person's income goes to servicing debt, then by definition, there is less for savings and investment. Less investment usually leads to less growth.
And here is where Japan is unique - they have managed to adjust to the debt servicing, and get better at allocating their investments to provide for a growing GDP per capita. Even more interesting is that their growth per capita in the first part of this century outstripped both the US & Germany (http://www.economist.com/node/10852462) - and the US was in a Fed-induced bubble at the time!
"GDP per head" is just another name for "productivity". And while they can scour the corners looking for untapped sources of productivity, that can't last forever. Japan is staring down the wrong end of a simple equation:
GDP = Population * Productivity
and then take the derivative:
d(GDP)/dt ~ d(Population)/dt + d(Productivity)/dt
Meaning you can still have growth in periods of population decline, but it's really hard, especially in this era where we've plucked all the low-hanging fruit as far as increasing productivity. And the greater the rate of decline, the harder it gets. Japan's population decline is still very slow, all things considered, but will accelerate as it hits the middle of the logistic curve.
But ~ is wrong, unless you're assuming that productivity is necessarily equal to population. It's not really right even then, because the ratio between GDP' and 2(Population') is not constant but rather equal to (Population).
I am curious to know how the trend of GDP per capita in Japan compares to other developed countries. When comparing US and Soviet Union, it is often said that the economy of USSR was expanding, much faster than any time in its history, but not quite as fast as US; and that is the reason US far surpassed USSR in terms of economy. If Japan's GDP per capita is not increasing as fast as or faster than the other developed countries, they may lag behind, just like USSR did.
GDP is a terrible measure of anything, except for monetary policy... which is almost entirely irrelevant to any kind of sociological considerations.
And your history is inaccurate. The primary consideration is simply that they were starting from a much lower base. They were an agricultural peasant society, with a fertility rate of over 5 children per mother.
The USSR was growing at breakneck pace during the first half of their existence, but just in very particular sorts of ways, as a result of forced collectivization, forced urbanization, and forced industrialization.
However, they levelled off quickly during the postwar years, even though they had a strong focus on nuclear research, space exploration, etc.
They had no one-child policy, they simply underwent a sped up version of the normal Demographic Transition, and ended up with below-replacement fertility rates just like Japan and many others have.
This, in combination with poor central planning, and no more low-hanging fruit, led to their stagnation. With war, and a glorious leader, uniting the people to undergo a complete transformation of their entire lifestyle, the rate of growth can be astounding.
But in the postwar years with absolutely none of that, and an already-industrialized economy, you run into a sort of nihilism, and all your lies become less likely to believed, and production targets less likely to be strived for. (see: optimum tautness)
Also the complexity of modern life, aside from the basics that they achieved early, is just very hard to plan for. Think of all the millions of niche products that you can buy, and then imagine trying to dictate to an entire economy how to produce all of that.
Most Western countries would have gone the same route if not for immigration and high birth rates amoung immigrants. Last month US birthrate fell below replacement rate despite immigrants if you take out immigrants us population is also declining.
Why is that bad? Should population on earth increase indefinitely? We are already too many. What about overpopulation? I also take a declining population over mass immigration, it has teared my country apart.
Deflation is the endless terrifying boogieman of economists and academics and drives the constant obsession with creating inflation by central banks. Prices coming down? Oh dear, we can't possibly have that!
I used to think that also until I studied economics in college. If you don't understand how deflation can be a bad thing, I suggest spending some time reading up on it. Deflation isn't just about prices drop while all else remains equal.
In a real deflation, prices fall. That's wonderful (unless you're selling). Then wages fall, which is less wonderful, but (I think) they don't usually fall more than prices do.
The problem is, your mortgage doesn't fall. Neither do the payments on any other debt you owe. They stayed at a constant number of dollars, but each dollar is now worth more. So your mortgage payment, for example, becomes a bigger fraction of your paycheck.
If you have debt when deflation happens, it can crush you.
Then you have the second-order effects. People go bankrupt, and their creditors sell off their assets. Or people sell assets, trying to avoid bankruptcy. In either case, the supply (of many things) increases, due to people trying to get what they can. This drives prices down. So we get more deflation, which puts even more people in a pinch, so even more people sell what they can...
> If you have debt when deflation happens, it can crush you.
In a slowly deflating world, (say central bank targeting -2% instead of +2%), debt will be priced at negative interest rates. There is no theoretical problems with this, and in fact negative yielding bonds have already happened.
Negative yielding bonds have already happened. But for most of us (as individuals), the debts we owe aren't in the form of bonds. How about negative yielding mortgages? Credit cards?
Theoretically, they could happen. In practice, they probably won't, at least for a while after the start of the deflation.
What difference does it make? In a competitive money market, negative rate loans will appear. Lenders still make a spread. The issue is not positive or negative rates, but whether the price expectation is stable or unstable. As long as the absolute value of price change is small the price is stable. As for why central banks prefer positive rather than negative, that's the better question.
Economists and psychotics are the only creatures who, when they and the universe do not agree, believe that it is not they who are wrong but the universe.
More to the point, you may not want uncontrollable deflation just like you don't want uncontrollable inflation, those are system instabilities due to feedback. But a controlled deflation that responds to long-run demographics and economic reality is no problem. In fact, forcing the opposite is stupid.
If you had to wager between central banks attempting to stoke inflation to make people work versus technology creating a never ending deflationary effect, who would you bet on?
Given the effectiveness of QE and ZIRP creating 10%-20% annual asset inflation for the past decade while most wages are flat? I'd have to bet on the central banks, not that I agree with the policy.
But are younger generations jumping onto the treadmill to acquire these assets at overinflated prices? That's the question.
Housing and equities might continue to go up in price, most everything else will decline (especially energy and transportation). Wouldn't that mean you could live well off of little if you opted out of high cost of living areas?
Prices include wages too. If all wages and prices adjusted instantaneously, then there is no real difference between inflation or deflation.
However, people are mentally resistant to being paid less (nominally) for a job, even though in inflation-adjusted terms they would be making the same thing (or more) as they did before. This "wage stickiness" leads to unemployment as companies choose to lay off people instead of paying them more (by holding their wages constant over time), and are also resistant to hiring new people at lower wages while keeping current employees stuck at higher wages, for fear that this would discourage current employees or cause internal conflict.
My solution be for let's say Japan would be to peg everything from wages to mortgages to the US dollar. Now with deflation you will be making losses in yen as the value of yen to the $ will keep increasing but in dollar terms and in actual buying strength you will still be improving. Though this will be something very hard to do and everyone would want to keep the yen instead of holding any asset.
But there are very real problems associated with deflation, namely that deflation discourages most forms of investment: why by a house, since it will be cheaper next year? Why build a factory, when the goods will be worth less next year? I suppose falling wages would offset some of it, but it is still problematic.
we are far far from too many people on this world. the amount of land not in use is at risk of exceeding ability to support more people any time soon. Figure a third of the land is usable for agriculture and only ten percent or such actually is and not all equally. Meaning we can certainly feed more people and the environment could support them except for politics.
One problem with this idea is that the land usable for agriculture also has to compete with other uses: residential housing, etc. You can't build housing in places where you can't grow food, because people don't really want to live in those places. So any place that's unusable for agriculture is also generally useless for most other human activities (it's either too hot or too cold, or is a wetland).
We already have enough environmental problems because humans have taken over too many wild spaces. There is not a large supply of usable land left; we've already used it. Point to a place that's currently unused, and I'll show you why no one wants to live there.
The same demographic trend is projected to hit the USA if the USA doesn't negate it with immigration.
Really the entire industrialized modern world has shrinking or stagnant population growth. Educated people are having less children (if any) and later in life.
You can't really negate it with immigration, can you?
Immigrants are going to retire too, and when they do, you're stuck with even more old people and still not enough working-age people for modern economy to function. Immigration is like going into debt to sustain quality of life.
Worse yet, you can end up with "illegal" elderly with zero savings. That would make for a miserable sight.
Edit: Is the idea to sustain the ever growing population anyway? Until what?
And that is a good thing. This isn't the pre-industrialized world anymore, we live on a planet with finite resources where automation is destroying the need for large tracts of labor.
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[ 3.3 ms ] story [ 176 ms ] thread"In his 2014 book Bending Adversity, Pilling grapples with the cognitive dissonance at the heart of 21st-century Japan: is it a harbinger of global stagnation? Or is it a model of global sustainability? In the book’s most-quoted passage, a British MP, on arriving in Tokyo in the early 2000s and surveying its lively environs, is reported to have said: “If this is a recession, I want one.”
Sorry. Not buying it. Growth is an ok thing as it happens, but as populations increase demand for resources such as land and water produce pressures that only get worse with more people. There's a reason you can sell a parking spot in Hong Kong for half a million dollars but can buy a lot of land in Canada or something for next to nothing. China was wrong to stop the 1-child policy. I'd like to see it implemented globally. Along with that I'd like to far reduce immigration to the United States (I'm just using the US as an example since I currently live here) as I don't want to see the population continue to grow. In the long run, population growth is good for me as a property owner and somebody with wealth, as prices on things like water and homes won't affect me, but I'm not selfish and I want people to not have to struggle to obtain basic resources or housing.
I don't think that's what topspin said. Topspin said prosperity stops population growth. Topspin did not say that population growth causes prosperity. "Growth!", as topspin puts it, is not the same thing as population growth. it's my understanding that as peoples become richer, they have fewer children [1]. That's the cause and effect I believe Topspin was highlighting. Having fewer children does not cause a people to become rich.
[1] https://en.wikipedia.org/wiki/Income_and_fertility
And to add, it's a problem that wealthy people aren't having children, because they are in the best position to educate and provide for them.
First, we don't need more mining, we need much less, preferably zero. We've extracted enough resources from the earth's crust, and mining has a huge environmental toll. We should be doing a far better job recycling, and we should be getting the rest from asteroids or the Moon. (I'll make exceptions for some things which are literally as common as dirt, such as silicates/sand/etc., though even here there's some problems with overconsumption.)
More people don't necessarily need to consume more resources. We should be living more sustainably, with less consumption per person. Living the way a typical suburban American lives is totally unsustainable, and grossly wasteful. We need to have smaller habitats in large, shared buildings (i.e. we should be living in urban high-rises, but well-built ones, not like those crappy ones in the UK), and we shouldn't have personally-owned vehicles, and instead should be using SkyTran PRT to get around quickly and cheaply with very low energy usage. Note that I'm all for the option of ownership of those housing units, just that we need more condos and fewer standalone houses; renting property has its own set of problems.
As for home prices, the main problem there is that investors are allowed to buy residential property. Ban that, and especially ban ownership by foreigners, and that'll fix that problem quickly. Housing prices have been inflated because of too much "investment" by various moneyed interests, such as wealthy foreigners looking for stable places to park their money outside their own country. This isn't helpful to the people who actually live in a place, as they're now competing with a huge number of outsiders (both inside and outside their country) when bidding on a housing unit to buy. This phenomenon simply didn't exist in the US a few decades or more ago. Vancouver Canada I believe recently enacted a law penalizing house owners who didn't actually make use of the house, as so many houses were sitting empty, owned by Chinese investors.
As to wealthy people having children, that's a non-sequitur: wealthy people are such a small portion of the population that even if they all had 6 kids, it wouldn't make a detectable difference. It's the middle class that you want having kids.
I don't disagree. We will have some mining forever though, whether that's here on earth or elsewhere.
> We should be living more sustainably, with less consumption per person.
I hope I didn't give you the impression that I think the opposite of that. I am all for sustainability. Including population sustainability.
> As to wealthy people having children, that's a non-sequitur: wealthy people are such a small portion of the population that even if they all had 6 kids, it wouldn't make a detectable difference. It's the middle class that you want having kids.
? I want fewer kids and fewer people. I want those with the means to (rich or upper middle class) to have kids, at least until we get the population of the planet much lower. So yes, a small amount of people having a few kids isn't a non-sequitur at all.
> No POVs
Dude/dude-ette... you should read my posts! I'm all for that :)
Thanks for your perspective.
Yes, of course; the need for raw materials is never-ending. I just want mining on Earth to mostly stop, or at least be done in the most environmentally-sustaining way possible. Moving a lot of mining offworld would accomplish this.
>I want those with the means to (rich or upper middle class) to have kids
I'm not so sure this is such a great idea. Rich people can already have all the kids they want; it's not like financial concerns are holding them back from it. And I don't see how they're going to do a better job of it than regular middle-class people; in fact, rich people generally seem to be much worse and more sociopathic human beings, and their kids frequently come out awful--look at Paris Hilton for instance. I don't see why we should be encouraging them to have more; we don't need more sociopaths in the world. And again, there's so few wealthy people it wouldn't make a significant difference.
Population stagnation could potentially lead to worldwide cultural stagnation, which would result in humans never getting off the planet and eventually getting wiped out somehow.
I understand the population piece, but I don't understand the cultural piece. Japan has stagnated, and it's clearly culturally vibrant. On the other hand, the United States brings in immigrants and is growing, yet I'm constantly scolded and reminded that I have no culture since I'm just a white person.
Oh, and back to the population piece. We're approaching 8 billion. How do you feel about, say, 3-4 billion? I mean, it seems like that's a pretty good number of people to get things done. We'd have less people doing menial work (or not working) and we'd have more essential and necessary work, wouldn't we?
I imagine it like this, say everyone but you died. you'd have all sorts of crap, you would virtually have anything you wanted. but with no people to make food, stuff, medicine, keep things running, eventually you have virtually nothing.
I have always believed the great depression was the result of a population decline from ww1 and Spanish flue that lead to the roaring 20s, followed by a bust that was only put to a close by the end of ww2
There'd be plenty of metals all around, but, without a technological society to maintain them, almost all machines will have decayed beyond usefulness by that point.
There's a strong benefit from division of labor and economies of scale that would bite you HARD if you're all by yourself.
Anti-globalism and population decline together would slice and dice up useful populations to the point where you'd get strong negative productivity curves as time went on.
Slight population decline combined with increasing globalism and automation isn't too bad. Until you get to the point where you have an incredibly aged population. That starts to bite hard as it still takes people to take care of the elderly. So either productive people have to spend their time primarily taking care of the elderly (instead of inventing things and building things and growing the economy) or the elderly go without care. Neither are very good.
If we get increasing and arbitrarily good automation and AI, it's not so much a problem. The robots take care of the elderly, and human beings gradually decline in population to be replaced by sentient AI. But I guess that's still a problem if you don't want humans to become extinct.
Provided we transition to clean energy (as we're doing) and electrify everything especially transport, there are plenty of resources.
And there definitely aren't 7 billion in the third world.
Funny that isn't it. It's almost like the Japanese have invested in robotic automation, high quality public infrastructure and using older people to best advantage.
Productive people earn more and earning more is correlated with longer life.
However, that's not the only way to get population losses. Epidemics would be probably be skewed on economic indicators -- Lower class -> higher density -> higher infection rate. War would be skewed towards younger ages -- recruited soldiers in that 18-25 bracket that are on the front lines.
Different causes will have differing effects on the population and different expected effects on GDP. You can't just generalize it to, "Wouldn't you expect GDP per capita to grow as population shrinks?" Which is what the original comment I replied to did.
I don't follow. Population decline among old people is due to death. Population decline due to low birth rate occurs at the opposite end of the age spectrum, among babies. Those losses start among unproductive children and mature over time into losses among productive young workers.
Population decline from low birth rates occurs in people that weren't born. If you segment the population by age, this will be obvious -- compare the population figures to the same figures for the hypothetical situation where birth rates are higher, and you'll see that the numbers that are lower in reality than in hypotheticality are those for the young segments. Old age groups won't decline from low birth rates until all younger age groups already have.
And from the perspective of losses to GDP, this is what's relevant. If birth rates decline starting in 1960, that has no effect on the population of people who were born in 1930. Their contribution to GDP will be just as it was always going to be. But the cohort born in 1980 will be much less productive, because it is smaller than it should have been, and that shows up in 2000 as a loss of young workers (compared to predictions), not old workers.
> You don't count people that weren't born in productivity, then call it a loss.
You do if you're arguing that losses to GDP are explained by lower birth rates.
"But the cohort born in 1980 will be much less productive, because it is smaller than it should have been, and that shows up in 2000 as a loss of young workers (compared to predictions), not old workers." (Emphasis mine.)
What defines what a group should have been? Predictions. But I've never heard of anyone calling a wrong prediction "losses" or "gains" before. If I'm predicted to sell a million units, and I only sell half that, did I "lose" half my sales? If a stock is predicted to go up a point, but goes down a point instead, did it "lose" two points?
Comparing what materialized as reality with predictions is a perfectly fine thing to do. But differences between the two are just wrong predictions, not gains and losses. You just simply can't lose something you never had.
We're talking about a decline in GDP related to a depression in the birth rate.
Imagine a society in perfect stability. Every year there are 50 people in their 20s, 48 people in their 30s, 45 people in their 40s, 41 people in their 50s, and 15 people over 60 but not yet retired. Every year, people die, causing the kind of "population losses" you're worrying about in your comments to me, but this causes no population losses or shrinkage of the kind you're talking about in your earlier comments, because those deaths are balanced out by an appropriate birth rate, keeping the population constant.
Now the birth rate drops. 30 years later, there are 30 people in their 20s, 48 people in their 30s, 45 people in their 40s, 41 people in their 50s, and 15 people over 60 but not yet retired. The economy has lost 40% of the age 20-30 worker demographic (it did this over a period of ten years, but still). It has lost 0% of the age 30+ worker demographic. We asked the question "are population losses randomly distributed over the population, meaning that GDP per capita should stay constant?" and we see that the answer is no. We also asked the question "are losses concentrated among older, unproductive retirees, meaning that GDP per capita should rise?" and we see that the answer to that question is also no. Losses are concentrated among the young, which means that GDP per capita should fall when those losses age into the productive segment of the workforce. (And then rise back to exactly where it once was when those losses have aged all the way through the population, including the population of retirees.)
I must say again, if we want to explain (1) a loss in GDP (the number has gotten lower) by reference to (2) a loss in the population generating the GDP (again, the number ["population"] has gotten lower), which is (3) attributed to lowered birth rates, THEN (4) the loss in population (in the sense of point 2, where we said that the population declined) has occurred among the young, not among the old. It's not even necessary to use comparisons to a hypothetical reality to perceive the losses; the bare fact that the population was once larger than it is now is a perfectly conventional interpretation of "population loss".
Think of it like accounting for stock at tax time. You can't just "sell stock". You have to sell a specific stock that you bought at a specific time for a specific basis. And if you had a loss on that sale, it is immutably and forever a loss. You can, however, offset a loss by selling a different stock for a gain.
This is a delusion that exists only in your own mind. You don't have to account gains and losses separately; most of the time you want to net them out, because you only care about the difference. Net losses are still losses -- that's why they're called "losses".
Think of it like accounting for mutual fund shares on an average cost basis.
You want to talk about average cost basis, but then you keep saying that you lost money because investment X only gained +$Y instead of +$(Y+Z). Which is wrong. You lost money because you had other investments that lost money. Investment X gained value; it just wasn't enough to offset those other losses.
For instance, infrastructure is a fixed cost. All the investment into roads, power grid, rail, airports, waterways, etc is now spread over fewer people.
Since public projects are usually debt funded, that usually means that fewer people have to shoulder the same debt burden.
When more of a person's income goes to servicing debt, then by definition, there is less for savings and investment. Less investment usually leads to less growth.
And here is where Japan is unique - they have managed to adjust to the debt servicing, and get better at allocating their investments to provide for a growing GDP per capita. Even more interesting is that their growth per capita in the first part of this century outstripped both the US & Germany (http://www.economist.com/node/10852462) - and the US was in a Fed-induced bubble at the time!
Japan has recently been using its bank to capture more of the interest payments on its debt:
"Japan has found a way to write off nearly half its national debt without creating inflation. We could do that too."
Sovereign Debt Jubilee, Japanese-Style - https://ellenbrown.com/2017/06/27/sovereign-debt-jubilee-jap...
d(GDP)/dt / GDP = d(Population)/dt / Population + d(Productivity)/dt / Productivity
So the relative change of GDP is still neatly separated into population growth component and productivity component.
GDP = Population * Active Population Ratio * Productivity
If the population ages too quickly, the active population rate can go down very fast...
And your history is inaccurate. The primary consideration is simply that they were starting from a much lower base. They were an agricultural peasant society, with a fertility rate of over 5 children per mother.
The USSR was growing at breakneck pace during the first half of their existence, but just in very particular sorts of ways, as a result of forced collectivization, forced urbanization, and forced industrialization.
However, they levelled off quickly during the postwar years, even though they had a strong focus on nuclear research, space exploration, etc.
They had no one-child policy, they simply underwent a sped up version of the normal Demographic Transition, and ended up with below-replacement fertility rates just like Japan and many others have.
This, in combination with poor central planning, and no more low-hanging fruit, led to their stagnation. With war, and a glorious leader, uniting the people to undergo a complete transformation of their entire lifestyle, the rate of growth can be astounding.
But in the postwar years with absolutely none of that, and an already-industrialized economy, you run into a sort of nihilism, and all your lies become less likely to believed, and production targets less likely to be strived for. (see: optimum tautness)
Also the complexity of modern life, aside from the basics that they achieved early, is just very hard to plan for. Think of all the millions of niche products that you can buy, and then imagine trying to dictate to an entire economy how to produce all of that.
In a real deflation, prices fall. That's wonderful (unless you're selling). Then wages fall, which is less wonderful, but (I think) they don't usually fall more than prices do.
The problem is, your mortgage doesn't fall. Neither do the payments on any other debt you owe. They stayed at a constant number of dollars, but each dollar is now worth more. So your mortgage payment, for example, becomes a bigger fraction of your paycheck.
If you have debt when deflation happens, it can crush you.
Then you have the second-order effects. People go bankrupt, and their creditors sell off their assets. Or people sell assets, trying to avoid bankruptcy. In either case, the supply (of many things) increases, due to people trying to get what they can. This drives prices down. So we get more deflation, which puts even more people in a pinch, so even more people sell what they can...
In a slowly deflating world, (say central bank targeting -2% instead of +2%), debt will be priced at negative interest rates. There is no theoretical problems with this, and in fact negative yielding bonds have already happened.
Theoretically, they could happen. In practice, they probably won't, at least for a while after the start of the deflation.
More to the point, you may not want uncontrollable deflation just like you don't want uncontrollable inflation, those are system instabilities due to feedback. But a controlled deflation that responds to long-run demographics and economic reality is no problem. In fact, forcing the opposite is stupid.
Except for people with mortgages or student loans to pay.
Right so you kind of proved my point, that deflation is the academic economist boogieman.
Housing and equities might continue to go up in price, most everything else will decline (especially energy and transportation). Wouldn't that mean you could live well off of little if you opted out of high cost of living areas?
However, people are mentally resistant to being paid less (nominally) for a job, even though in inflation-adjusted terms they would be making the same thing (or more) as they did before. This "wage stickiness" leads to unemployment as companies choose to lay off people instead of paying them more (by holding their wages constant over time), and are also resistant to hiring new people at lower wages while keeping current employees stuck at higher wages, for fear that this would discourage current employees or cause internal conflict.
http://www.investopedia.com/articles/economics/09/wage-stick...
We already have enough environmental problems because humans have taken over too many wild spaces. There is not a large supply of usable land left; we've already used it. Point to a place that's currently unused, and I'll show you why no one wants to live there.
https://youtu.be/QsBT5EQt348
Really the entire industrialized modern world has shrinking or stagnant population growth. Educated people are having less children (if any) and later in life.
Immigrants are going to retire too, and when they do, you're stuck with even more old people and still not enough working-age people for modern economy to function. Immigration is like going into debt to sustain quality of life.
Worse yet, you can end up with "illegal" elderly with zero savings. That would make for a miserable sight.
Edit: Is the idea to sustain the ever growing population anyway? Until what?
Well from a purely numerical standpoint, yes you can.
> Worse yet, you can end up with "illegal" elderly with zero savings. That would make for a miserable sight.
That describes a huge number of native elderly in the USA too. Most elderly rely on social security entirely.
> Well from a purely numerical standpoint, yes you can.
Not forever, though -- eventually everyone will immigrate.
https://simple.wikipedia.org/wiki/List_of_countries_by_popul...