THE RELIGIOUS CONSULTATION
on population, reproductive health & ethics

Newsweek International, September 27, 2004

Birth Dearth
Remember the population bomb? The new threat to the planet is not too many people but too few. How the new demography will shape the coming century.

By Michael Meyer
Newsweek International

Sept. 27 issue - Everyone knows there are too many people in the world. Whether we live in Lahore or Los Angeles, Shanghai or So Paulo, our lives are daily proof. We endure traffic gridlock, urban sprawl and environmental depredation. The evening news brings variations on Ramallah or Darfur—images of Third World famine, poverty, pestilence, war, global competition for jobs and increasingly scarce natural resources.

Just last week the United Nations warned that many of the world's cities are becoming hopelessly overcrowded. Lagos alone will grow from 6.5 million people in 1995 to 16 million by 2015, a miasma of slums and decay where a fifth of all children will die before they are 5. At a conference in London, the U.N. Population Fund weighed in with a similarly bleak report: unless something dramatically changes, the world's 50 poorest countries will triple in size by 2050, to 1.7 billion people.

Yet this is not the full story. To the contrary, in fact. Across the globe, people are having fewer and fewer children. Fertility rates have dropped by half since 1972, from six children per woman to 2.9. And demographers say they're still falling, faster than ever. The world's population will continue to grow—from today's 6.4 billion to around 9 billion in 2050. But after that, it will go sharply into decline. Indeed, a phenomenon that we're destined to learn much more about—depopulation—has already begun in a number of countries. Welcome to the New Demography. It will change everything about our world, from the absolute size and power of nations to global economic growth to the quality of our lives.

This revolutionary transformation will be led not so much by developed nations as by the developing ones. Most of us are familiar with demographic trends in Europe, where birthrates have been declining for years. To reproduce itself, a society's women must each bear 2.1 children. Europe's fertility rates fall far short of that, according to the 2002 U.N. population report. France and Ireland, at 1.8, top Europe's childbearing charts. Italy and Spain, at 1.2, bring up the rear. In between are countries such as Germany, whose fertility rate of 1.4 is exactly Europe's average. What does that mean? If the U.N. figures are right, Germany could shed nearly a fifth of its 82.5 million people over the next 40 years—roughly the equivalent of all of east Germany, a loss of population not seen in Europe since the Thirty Years' War.

And so it is across the Continent. Bulgaria will shrink by 38 percent, Romania by 27 percent, Estonia by 25 percent. "Parts of Eastern Europe, already sparsely populated, will just empty out," predicts Reiner Klingholz, director of the Berlin Institute for Population and Development. Russia is already losing close to 750,000 people yearly. (President Vladimir Putin calls it a "national crisis.") So is Western Europe, and that figure could grow to as much as 3 million a year by midcentury, if not more.

The surprise is how closely the less-developed world is following the same trajectory. In Asia it's well known that Japan will soon tip into population loss, if it hasn't already. With a fertility rate of 1.3 children per woman, the country stands to shed a quarter of its 127 million people over the next four decades, according to U.N. projections. But while the graying of Japan (average age: 42.3 years) has long been a staple of news headlines, what to make of China, whose fertility rate has declined from 5.8 in 1970 to 1.8 today, according to the U.N.? Chinese census data put the figure even lower, at 1.3. Coupled with increasing life spans, that means China's population will age as quickly in one generation as Europe's has over the past 100 years, reports the Center for Strategic and International Studies in Washington. With an expected median age of 44 in 2015, China will be older on average than the United States. By 2019 or soon after, its population will peak at 1.5 billion, then enter a steep decline. By midcentury, China could well lose 20 to 30 percent of its population every generation.

The picture is similar elsewhere in Asia, where birthrates are declining even in the absence of such stringent birth-control programs as China's. Indeed, it's happening despite often generous official incentives to procreate. The industrialized nations of Singapore, Hong Kong, Taiwan and South Korea all report subreplacement fertility, says Nicholas Eberstadt, a demographer at the American Enterprise Institute in Washington. To this list can be added Thailand, Burma, Australia and Sri Lanka, along with Cuba and many Caribbean nations, as well as Uruguay and Brazil. Mexico is aging so rapidly that within several decades it will not only stop growing but will have an older population than that of the United States. So much for the cliché of those Mexican youths swarming across the Rio Grande? "If these figures are accurate," says Eberstadt, "just about half of the world's population lives in subreplacement countries."

There are notable exceptions. In Europe, Albania and the outlier province of Kosovo are reproducing energetically. So are pockets of Asia: Mongolia, Pakistan and the Philippines. The United Nations projects that the Middle East will double in population over the next 20 years, growing from 326 million today to 649 million by 2050. Saudi Arabia has one of the highest fertility rates in the world, 5.7, after Palestinian territories at 5.9 and Yemen at 7.2. Yet there are surprises here, too. Tunisia has tipped below replacement. Lebanon and Iran are at the threshold. And though overall the region's population continues to grow, the increase is due mainly to lower infant mortality; fertility rates themselves are falling faster than in developed countries, indicating that over the coming decades the Middle East will age far more rapidly than other regions of the world. Birthrates in Africa remain high, and despite the AIDS epidemic its population is projected to keep growing. So is that of the United States.

We'll return to American exceptionalism, and what that might portend. But first, let's explore the causes of the birth dearth, as outlined in a pair of new books on the subject. "Never in the last 650 years, since the time of the Black Plague, have birth and fertility rates fallen so far, so fast, so low, for so long, in so many places," writes the sociologist Ben Wattenberg in "Fewer: How the New Demography of Depopulation Will Shape Our Future." Why? Wattenberg suggests that a variety of once independent trends have conjoined to produce a demographic tsunami. As the United Nations reported last week, people everywhere are leaving the countryside and moving to cities, which will be home to more than half the world's people by 2007. Once there, having a child becomes a cost rather than an asset. From 1970 to 2000, Nigeria's urban population climbed from 14 to 44 percent. South Korea went from 28 to 84 percent. So-called megacities, from Lagos to Mexico City, have exploded seemingly overnight. Birth rates have fallen in inverse correlation.

Other factors are at work. Increasing female literacy and enrollment in schools have tended to decrease fertility, as have divorce, abortion and the worldwide trend toward later marriage. Contraceptive use has risen dramatically over the past decade; according to U.N. data, 62 percent of married or "in union" women of reproductive age are now using some form of nonnatural birth control. In countries such as India, now the capital of global HIV, disease has become a factor. In Russia, the culprits include alcoholism, poor public health and industrial pollution that has whacked male sperm counts. Wealth discourages childbearing, as seen long ago in Europe and now in Asia. As Wattenberg puts it, "Capitalism is the best contraception."

The potential consequences of the population implosion are enormous. Consider the global economy, as Phillip Longman describes it in another recent book, "The Empty Cradle: How Falling Birthrates Threaten World Prosperity and What to Do About It." A population expert at the New America Foundation in Washington, he sees danger for global prosperity. Whether it's real estate or consumer spending, economic growth and population have always been closely linked. "There are people who cling to the hope that you can have a vibrant economy without a growing population, but mainstream economists are pessimistic," says Longman. You have only to look at Japan or Europe for a whiff of what the future might bring, he adds. In Italy, demographers forecast a 40 percent decline in the working-age population over the next four decades—accompanied by a commensurate drop in growth across the Continent, according to the European Commission. What happens when Europe's cohort of baby boomers begins to retire around 2020? Recent strikes and demonstrations in Germany, Italy, France and Austria over the most modest pension reforms are only the beginning of what promises to become a major sociological battle between Europe's older and younger generations.

That will be only a skirmish compared with the conflict brewing in China. There market reforms have removed the cradle-to-grave benefits of the planned economy, while the Communist Party hasn't constructed an adequate social safety net to take their place. Less than one quarter of the population is covered by retirement pensions, according to CSIS. That puts the burden of elder care almost entirely on what is now a generation of only children. The one-child policy has led to the so-called 4-2-1 problem, in which each child will be potentially responsible for caring for two parents and four grandparents.

Incomes in China aren't rising fast enough to offset this burden. In some rural villages, so many young people have fled to the cities that there may be nobody left to look after the elders. And the aging population could soon start to dull China's competitive edge, which depends on a seemingly endless supply of cheap labor. After 2015, this labor pool will begin to dry up, says economist Hu Angang. China will have little choice but to adopt a very Western-sounding solution, he says: it will have to raise the education level of its work force and make it more productive. Whether it can is an open question. Either way, this much is certain: among Asia's emerging economic powers, China will be the first to grow old before it gets rich.

Equally deep dislocations are becoming apparent in Japan. Akihiko Matsutani, an economist and author of a recent best seller, "The Economy of a Shrinking Population," predicts that by 2009 Japan's economy will enter an era of "negative growth." By 2030, national income will have shrunk by 15 percent. Speculating about the future is always dicey, but economists pose troubling questions. Take the legendarily high savings that have long buoyed the Japanese economy and financed borrowing worldwide, especially by the United States. As an aging Japan draws down those assets in retirement, will U.S. and global interest rates rise? At home, will Japanese businesses find themselves competing for increasingly scarce investment capital? And just what will they be investing in, as the country's consumers grow older, and demand for the latest in hot new products cools off? What of the effect on national infrastructure? With less tax revenue in state coffers, Matsutani predicts, governments will increasingly be forced to skimp on or delay repairs to the nation's roads, bridges, rail lines and the like. "Life will become less convenient," he says. Spanking-clean Tokyo might come to look more like New York City in the 1970s, when many urban dwellers decamped for the suburbs (taking their taxes with them) and city fathers could no longer afford the municipal upkeep. Can Japanese cope? "They will have to," says Matsutani. "There's no alternative."

Demographic change magnifies all of a country's problems, social as well as economic. An overburdened welfare state? Aging makes it collapse. Tensions over immigration? Differing birthrates intensify anxieties, just as the need for imported labor rises—perhaps the critical issue for the Europe of tomorrow. A poor education system, with too many kids left behind? Better fix it, because a shrinking work force requires higher productivity and greater flexibility, reflected in a new need for continuing job training, career switches and the heath care needed to keep workers working into old age.

In an ideal world, perhaps, the growing gulf between the world's wealthy but shrinking countries and its poor, growing ones would create an opportunity. Labor would flow from the overpopulated, resource-poor south to the depopulating north, where jobs would continue to be plentiful. Capital and remittance income from the rich nations would flow along the reverse path, benefiting all. Will it happen? Perhaps, but that presupposes considerable labor mobility. Considering the resistance Europeans display toward large-scale immigration from North Africa, or Japan's almost zero-immigration policy, it's hard to be optimistic. Yes, attitudes are changing. Only a decade ago, for instance, Europeans also spoke of zero immigration. Today they recognize the need and, in bits and pieces, are beginning to plan for it. But will it happen on the scale required?

A more probable scenario may be an intensification of existing tensions between peoples determined to preserve their beleaguered national identities on the one hand, and immigrant groups on the other seeking to escape overcrowding and lack of opportunity at home. For countries such as the Philippines—still growing, and whose educated work force looks likely to break out of low-status jobs as nannies and gardeners and move up the global professional ladder—this may be less of a problem. It will be vastly more serious for the tens of millions of Arab youths who make up a majority of the population in the Middle East and North Africa, at least half of whom are unemployed.

America is the wild card in this global equation. While Europe and much of Asia shrinks, the United States' indigenous population looks likely to stay relatively constant, with fertility rates hovering almost precisely at replacement levels. Add in heavy immigration, and you quickly see that America is the only modern nation that will continue to grow. Over the next 45 years the United States will gain 100 million people, Wattenberg estimates, while Europe loses roughly as many.

This does not mean that Americans will escape the coming demographic whammy. They, too, face the problems of an aging work force and its burdens. (The cost of Medicare and Social Security will rise from 4.3 percent of GDP in 2000 to 11.5 percent in 2030 and 21 percent in 2050, according to the Congressional Budget Office.) They, too, face the prospect of increasing ethnic tensions, as a flat white population and a dwindling black one become gradually smaller minorities in a growing multicultural sea. And in our interdependent era, the troubles of America's major trading partners—Europe and Japan—will quickly become its own. To cite one example, what becomes of the vaunted "China market," invested in so heavily by U.S. companies, if by 2050 China loses an estimated 35 percent of its workers and the aged consume an ever-greater share of income?

America's demographic "unipolarity" has profound security implications as well. Washington worries about terrorism and failing states. Yet the chaos of today's fragmented world is likely to prove small in comparison to what could come. For U.S. leaders, Longman in "The Empty Cradle" sketches an unsettling prospect. Though the United States may have few military competitors, the technologies by which it projects geopolitical power—from laser-guided missiles and stealth bombers to a huge military infrastructure—may gradually become too expensive for a country facing massively rising social entitlements in an era of slowing global economic growth. If the war on terrorism turns out to be the "generational struggle" that national-security adviser Condoleezza Rice says it is, Longman concludes, then the United States might have difficulty paying for it.

None of this is writ, of course. Enlightened governments could help hold the line. France and the Netherlands have instituted family-friendly policies that help women combine work and motherhood, ranging from tax credits for kids to subsidized day care. Scandinavian countries have kept birthrates up with generous provisions for parental leave, health care and part-time employment. Still, similar programs offered by the shrinking city-state of Singapore—including a state-run dating service—have done little to reverse the birth dearth. Remember, too, that such prognoses have been wrong in the past. At the cusp of the postwar baby boom, demographers predicted a sharp fall in fertility and a global birth dearth. Yet even if this generation of seers turns out to be right, as seems likely, not all is bad. Environmentally, a smaller world is almost certainly a better world, whether in terms of cleaner air or, say, the return of wolves and rare flora to abandoned stretches of the east German countryside. And while people are living longer, they are also living healthier—at least in the developed world. That means they can (and probably should) work more years before retirement.

Yes, a younger generation will have to shoulder the burden of paying for their elders. But there will be compensations. As populations shrink, says economist Matsutani, national incomes may drop—but not necessarily per capita incomes. And in this realm of uncertainty, one mundane thing is probably sure: real-estate prices will fall. That will hurt seniors whose nest eggs are tied up in their homes, but it will be a boon to youngsters of the future. Who knows? Maybe the added space and cheap living will inspire them to, well, do whatever it takes to make more babies. Thus the cycle of life will restore its balance.

With Stefan Theil in Berlin, Eric Pape and Tracy Mcnicoll in Paris, Kay Itoi in Tokyo, Sarah Schafer in Beijing, Owen Matthews in Istanbul and bureau reports

© 2004 Newsweek, Inc.
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