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Japan - Too Old To Grow?
The Japanese Social Security system has a report out on the aging problem in Japan (Forbes link). That Japan has a rapidly aging population is an old story, but the new numbers are worth considering.
Japanese Work Force
2010 = 82m
2025 = 71m (-13%)
2040 - 58m (-30%)
Japanese Total Population
2010 = 127m
2050 = 80m (-37%)
Japanese Aged Population
2010 - 11% of population is 75 or older
2025 - 22%+ will be >75 (Double)
I defy any economist to show me a road map for Japan that does not lead to crisis based on these numbers. I don't care what Abe says, or what the new head of the Central Bank, Kuroda, does. It will not matter. As a country, Japan is a long-term short.
Japan's pay-as-you-go Social Security system will rob future worker's paychecks. The cost of medical care for the +75 group is 5Xs that of younger citizens. Budget deficits to pay for all this will have to explode, the national debt with it.
There have been dozens of rallies in the Nikkei the past 23 years. With each rally, the bulls came out and proclaimed that the bottom had been set. The current rally is no different. The thinking by many is that a new golden age for Japanese stocks is upon us. I find that hard to believe. I don't care how much money Japan prints. Those printing presses can't offset the powerful force of demographics, at least not for long.
There are always different views on Wall Street. There are plenty of folks who love Japanese stocks, believe that printing money solves all problems and that demographics don't really matter at all. Time will tell.
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Japan is ahead of the U.S. curve.
Smaller country, and more efficient.
Post WWII they adopted the U.S. model then burned through it faster than we ever could.
The future of the U.S. is a combination of Japan and Greece; offshoring of production and employment, endless money printing and currency debasement, rapidly aging population, but with a dependent underclass much larger and more dependent that any in Japan.
"Smaller country, and more efficient."
Two things:
1) Jevons Paradox;
2) Japan has little in the way of its own energy resources (the US has LOTS, though this is meaningless at very high consumption rates).
I'd said it a LONG time ago (here), that Japan was fucked because it was an island nation/country that was highly dependent upon exports and on energy imports (and I later added in the demographics issue as the "third strike").
I don't think that there's a lot of future growth in US off-shoring. I'd made the argument that the currents have US businesses actually returning back to the US (that's the reason why the "bring back our jobs" campaign is so visible- it's propaganda to prime the pumps for major concessions to businesses returning [when they'd likely end up otherwise getting kicked out from abroad through the coming trade wars]). BUT.. it still is an issue of not being able to push on a string- where are the markets? disposable income is rapidly declining for everyone (except a very few at the top of the pyramid): you can lead a horse to water...
"The future of the U.S. is a combination of Japan and Greece..."
A nation's population too rad sick to work, too sick to recreate, and economically in flames. Yes, that's about right.
Look at any newspaper/contemporary articles from the 50's to the 70's on Japan, and you will read the exact same crap that is written about China today, except perhaps people were much more casually and overtly racist back then. Most people simply presumed that the Japanese were inferior in every way and that presumption usually stayed with them for life. Fast forward 30+ yrs, and most people these days simply presume the exact opposite. Sony, Nintendo, Honda, Nissan, and a smattering of others are bywords for innovation, quality, and manufactured dependability. Those presumptions, on the opposite ends of the scale are the problem with any analysis on Japan.
It is incredibly difficult to ignore a lifetime of prejudices, assumptions, peer pressures, mass media bias, and generalizations common to the era. But articles like this are a refreshing breath of fresh air that dispel the cobwebs of myths. Debt/GDP ratios, demographics, and graduate employment rates all point towards a declining country, even without the natural/man-made disasters that frequent their shores. I think the combination of rabid QE and toxic derivatives that Abe wants his central bank to buy will finish off Japan well before demographics come into play, and it's possible that Japan's assets will be up for grabs to bidders when its debt mountain collapses within my lifetime.
The point is, Japan, USA, UK, and the EU, or anyone else for that matter are not exceptional. They are all vulnerable to the same forces that have collapsed other countries and empires in the past. It seems to me that the moment a group of people presume something to be invulnerable, unsinkable, unbeatable, exceptional, or plain old superior to anything else in existence, that is precisely the moment to get the hell off the ship.
One big fat Thank You! I'd welcome you as a neighbor!
" It seems to me that the moment a group of people presume something to be invulnerable, unsinkable, unbeatable, exceptional, or plain old superior to anything else in existence, that is precisely the moment to get the hell off the ship. "
I think that this could be summed as "nationalistic-induced hubris."
It's all quite a bit like sports teams. Amazing how TPTB have everyone trained to "compete" against one another for Their (TPTB's) benefit. But... TPTB make us feel good about ourselves by always getting us to think in therms of exceptionalism. States/nations/religions, ALL are pyramidal hierarchies, which can ONLY exist as long as people believe they require some sort of (earth-based?) "leader."
Although western Europe suffers far greater from the Cultural Marxist, ideal this is a pretty good example of why feminism and the welfare state are a very toxic combination for a nation's survival.
Hm, sounds like a Statist sandwhch kind of thing. One slice of the bread is the "State" and the other is the "Nation."
Obviously, one can spew just about any shit, and as long as they runt and say "Marxism, Bad" etc then it's instant up-arrow.
You're blaming the symptoms and NOT the PROBLEM.
"Welfare" is the result of the PROBLEM, so too is "feminism" (but what of "manism?" in both case it's about being conditioned to perform a "job" in the "machine").
When you deplete the things that produce real wealth -natural resources- then there's LESS to go around. This results in, whether by design or by "evolution," some sort of means of decreasing "resource allocations."
"Welfare" works to help manage "resource allocations" by pushing folks into categories that allow them to be managed, to control their consumption (of resources).
If we're struggling with "resource allocations" then having women at home producing more "resource consumers" is only going to intensify the "resource allocation" problem, isn't it?
Business was the sector/entity that promoted feminism because it needed MORE workers, and workers who would work for less. Perhaps more importantly, these additional workers would be additional consumers. Double WIN! And, of course, businesses (non State) goaded the State into helping set laws in place that would promote all of this.
I detest nationalism as much as I detest statism.
I'm kind of disheartened to see, by nothing but up-arrows for your comment, that most here fail to understand the real dynamics that have occurred/are occurring.
In this case by nation I mean society. The state of course in all its evil isn't society, yet is capable of strongly influencing direction.
Nationalism is a two-sided coin. Generally you only hear the bad of which there is much to learn from but there is another side that gets shunned/ Undoubtedly it's a very delicate balance but I would argue that western Europe has suffered from a lack of healthy nationalism, i.e. the defense of national sovereignty and opposition to globalism. They would not be in their current predicament if they had more national pride than hope in the collectivist ideal. I would say the same for the US where instead of harkening back to the ideal set forth by the founders whenvever there's a problem, we almost always end up doing the opposite. I'm not talking about 'Boot in your ass it's the American way my country is always right' garbage which is where I think you believed I was coming from.
The Rockefellers were purportedly pretty influential in pushing 'womans lib' and I'm sure other business interests saw plenty of upside as well. Let's not forget though that government was the greater beneficiary by getting to tax the other half of the population and getting more power to indoctrinate the youth.
Death cures cancer,
and large chunks of pension liability.
No one has a clue what Japan will look like 10 years from now, or what the States will look like either.
"No one has a clue what Japan will look like 10 years from now, or what the States will look like either."
I don't agree with this statement.
One can approximate things through first eliminating the least probable outcomes. There is a CLEAR trajectory happening, over the entire globe.
Now, if you would have stated "No one can be CERTAIN..." then I'd have had no grounds for disagreement. Words MATTER because they provide the inputs to LOGIC, and it's logic that allows us to address assessing things in a manner that has a greater chance at achieving a favorable outcome than using, say, emotions (in which case it turns into some shouting match).
In ten years, Japan will consist primarily of the barely-mobile terminally ill taking care of hospice patients and burial duty. The US will take just a tiny bit longer.
And that is optimistic.
If the US is not Greece, but is Japan, then when does our stock market fall 90%?
Are you being facetious?
Is this like "when is Dancing With The Stars on?"
What does it really matter? If this happens, which it is destined to (and then pretty much go to zero), what decisions will you have made prior to then in anticipation?
Japan isn't just "is," it's "going." It's a trajectory, and the speed is now largely determined by factors outside a given country. Consider the obvious fate of the EU. When the EU collapses that takes a big bite out of Japan's export market. Japan then would NOT be what it currently "is." When, however, does the actual tipping point occur at which the momentum takes hold? Things can build over a long period of time and then in an instant, flip! Japan has been building toward the tipping point for a long time now. I'm not thinking that it is only half way to the tipping point, in which case it's less than 3 decades to impact: and given that outside forces are also now building I'd have to say that it's considerably more probable that the impact moment is closer to NOW than it is "3 decades from now."
So, what effect would a collapsed EU AND Japan have on the US? I don't think anyone could realistically, under this scenario, believe that the US could muddle along for 3 decades (as its stock market drops 90%).
"...then when does our stock market fall 90%?"
When they want it to.
When will then be now?
Soon...
http://m.youtube.com/#/watch?v=VeZ9HhHU86o&desktop_uri=/watch?v=VeZ9HhHU86o
It should be plain as day that the modern economy is out of synch with human biology. With women in the labor force on the same basis and career paths as men they must sacrifice their prime childbearing years or risk falling permanently out of the middle class. The only way around this is going to be either artificially impregnating post menopausal women as surrogate moms or some form of in vitro incubation of babies. You could even set up a eugenics program to harvest the eggs from the 'best' females and set up a factory farm for the raising of additional population. Some country is going to try it. My guess South Korea or Japan.
What "problem" is it that we're REALLY looking to resolve?
We've already done the "let's try to over-populate the planet" thing, and, clearly, it's not very smart.
If you promote some population "solution" then you can be assured that TPTB will pass along their genes and all others will go by the wayside. Yeah, imagine a future with only folks that sit around and call out "pool boy, over here!" (but, since only their genes were promoted there's no "pool boys")
It's about sustainability. And, gasp!, "subsistence" = "sustainability." What about "not too much, not too little" do people NOT understand? The "superior" peoples/cultures are clearly ill-equipped to survive in the future.
"Men argue, nature acts." - Voltaire
The "smart" men are arguing over who is smartest, who shall determine who shall live (and they pick themselves, of course). The "less-smart" men are working closer to nature, trying to dodge the bullets and bombs of the "smart" men.
The "smart" men are clever!
http://www.allspecies.org/ideas/clever.htm
That's just a recap of "Brave New World"
They better get started. Infant Mortality Rates are up 46% in some places:
http://www.examiner.com/article/radiation-cover-up-fox-pulls-mangano-rad...
http://www.counterpunch.org/2011/06/10/is-the-increase-in-baby-deaths-in...
Invite in the third world, see how well that turns out! Egalitarian brainstems won't stop until everything is a dysgenic dystopian cesspool.
not all cultures/peoples are equal. just because their country is poor in money does not mean it's poor in morals and culture.
only one set of people in this world burn down girls schools and stone people.
there is nothing harmful about importing a few phillipinos, chileans and burmese to a western society. for example.
"only one set of people in this world burn down girls schools and stone people. "
And I know of one that bombs them...
You do the superiority complex really well, don't you?
"there is nothing harmful about importing a few phillipinos"
LOL. And your great culture essentially trashed these folks to begin with!
Talk about treating people like cattle!
I'm pretty certain that my Filipino wife would pet the vat majority of folks here to shame (most certainly YOU). I treat her as a COMPLETE equal.
BTW - It's Filipinos, you ignorant fuck.
If I could down-arrow you 1,000,000 I'd do it.
seer, that's not what i meant at all man.
i respect a lot of cultures and i believe that western societies benefit and we as people benefit from mixing cultures. we learn new things, get a diffrent wievpoints and it keeps us from getting stale and inbred.
as long as these cultures do not have values that are incompatible to ours. you know which one im talking about.
if i ever met your wife i would treat her as an equal as well, just like i do my wife who is also asian.
Did you mean "put"? :-D
It was secret code! </sarc>
Yeah, should have read: "put the vast"...
And here I thought no one was really reading what I was posting! Note to self: straighten up on the editing!
Wait, we're importing Burmese? Are they good at landscape maintenance? Can they start next Monday?
Actually, culture and money are pretty well correlated.
Go, Qatar, go.
If they somehow had surplus youth as in Europe.
What would they do ?
A bit of American Graffiti ?
http://www.youtube.com/watch?v=tynE_6OqeBM
I don't think so mate.
The Spanish retire at 18..........................
At best the Japs don't have enough young people to game the declining energy capital.
What do dynamic young people really do in modern western societies when you can't run fossil fuel energy through their vibrant bodies ?
Do they dig drainage ditches on the old farm ?
Seems you have a pretty good grasp here.
"Do they dig drainage ditches on the old farm ?"
IF that work provides more return than the energy put into it. Heck, I and my wife do this, AND we're "old!" I look around and I see that most of the younger folks COULDN'T physically do what we do! Scary...
Ireland may have a few extra young people but not like the 19th century. The problem for Europe is not only do that not enough enough young people to sustain their aging populations they don't even employ the few they do have. All those middle aged workers in their state protected jobs are going to find out they screwed up big time when they try and retire. They should've quit and let junior have the job because the one thing no Keynesian economist can do is get back the years the young spent unemployed.
It wouldn't have mattered if all the young had managed to get employed. The equation is the SAME. Consume MORE than you PRODUCE and it all goes negative. Europe could never out-pace energy costs (imports) with exports: and, as energy jumps up for everyone else around the globe the export market for Europe WILL shrink.
Sometimes the dragon you're fighting really isn't the real dragon... if you fail to grasp the fundamentals properly then any "solution" IS going to fail (or the probabilities for "success" are going to rest more on random luck than on anything else).
TPTB will get their younger workforce. What they won't get is a younger workforce that will be able to properly continue promoting robots and automation; the reason has to do with economies of scale- there won't be sufficient population numbers to support volume breaks (think how the USPS relies on junk mail; or, the trucking industry relies on the POV to help subsidize road costs).
Even if the Japanese were to open their doors to immigration where is it going to come from? Not China, not Korea and Filipinos are spread pretty thin around the world already. Other than the Palestinians and a few places in Africa, birth rates are falling around the world. We might be able to spare them a few million Central American mestizos but 50 million?
dude. you are seriously underestimating the number of dirt poor people in asia.
to suggest that japan will not be able to find/attract enough immigrants is crazytalk.
So, the issue is just to see how many younger people can fit on an island?
I'm thinking that the REQUIREMENT is to have an educated younger workforce to replace the older one. Am I wrong in this assumption?
With stuff being highly automated there aren't as many jobs as people seem to think: that's why I bash the notion about "losing jobs overseas," as many human positions get replaced by automation when factories relocate.
HOWEVER... since we're heading toward a FAR lower standard of living for the "developed" world then the notion of having folks who can DO subsistence living might not be a bad way to re-mold things. But, again, then it comes down to the entire point, and just stuffing a bunch of people on an island really isn't any strategy (my wife is from the Philippines [yeah, I got one of those great Filipinas (a top notch overachiever)], I have a pretty good idea on what POOR is, as well as what an "island" that is overpopulated with younger people is like).
But can Japan get them on terms Japan will accept? Back in the 90s, they tried getting South Americans of Japanes ancestry to come to Japan and live permanently as second class citizens for marginally more money than they could get as first class citizens of the South American country they were born in. It didn't fly.
Until a gaijin gets the same money AND SOCIAL STANDING as a nihonjin in the same line of work, Japan needs to raise its own babies. OK, more money works too, but that isn't on offer either.
Come on Bruce! 2040?! 2050?!
DavidC
Forget 2040. They won't make it that far.
The report says the workforce will drop 13% in 13 years. That is a huge change in a very short period of time.
The report also says the #>75 will double in the same 13 years.
It will not take 13 years to feel the effects of these big changes.
Bruce, you do a great service on this topic.
"It will not take 13 years to feel the effects of these big changes."
There's a physical tipping point and then there's a social/psychological tipping point. The later will trigger the former earlier than that dictated/defined by the former.
This is contraction, plain and simple. The System just doesn't do contraction LONG very well.
More and more physical labor will be required as the costs of operating machines increases (due to costs for new materials and energy). And with an aging population that has programmed itself with notions of "retirement"...
kyle says sooooon, although no specifics, he is chop lickin and ready...
the dumb mf'ers(i was thinking of dr. k).
tryin to be nice
I have a man-crush on Kyle, but I hope he doesn't get hit with a 120% windfall tax when he goes to collect.
They sure know how to clean up a mess: http://www.theatlantic.com/infocus/2013/03/japan-earthquake-2-years-later-before-and-after/100469/
Too bad radioactive polution is a little trickier.
That clean up has spread radioactive debris all across Honshu.
Add the radioactive soot from the burning of Fuku debris to the jetstream, and it's worldwide.
Apparently this afternoon, Al Jazeera suggested Fuku radiation is to blame for the sea lion dieoff on the NA West Coast. If they were a country, we'd be invading them in 3, 2, . . .
Must.stop.Fukushima.reporting.
Japanese have always had some reserves of unique courage, and they are starting to show it ... wouldn't write them off yet, as they pull some gutsy and bold moves ... even with demographics
Japanese are on the verge of finally overcoming their xenophobia to realise that a few million nice Filipinas and Filipinos there would create an economic boom while posing very few social problems
The Filipinas in Japan have established quite a good reputation for themselves, the Japanese already know how 'nice' immigration can be, if you are careful about who you allow in.
Similarly with their technological boldness, their new ability to extract gas from undersea ice methane ... radical solution to their energy needs, along with joining the vanguard of the newer, much safer thorium reactors that can even use up most of the old spent fuel rods in their old reactors
Their odd war-dance with China is part of this scenario ... they are getting themselves mentally in the frame of being a new, bolder, much different people than they were ... Ultimately after some bluster they will likely patch things up with both China and South Korea, to create the new East Asian economic powerhouse
Dead wrong on reusing those spent fuel rods. It didn't work and now they have the additional storage and final resting place issues which have taken a back seat to getting the regular reacters going by years end. It was a Nice try though.
Most of the observations are based on PAST performances in a PAST world. The future WON'T be like the PAST.
"Similarly with their technological boldness"
God, the "technology as savior" shit never dies, does it?
Dead old people. Robots (though not long). Younger, starving people. THERE is their future.
Logan's Run.
Thorium reactors... how many are in production in the world today? Japan's debts are mounting, and doubly so as energy costs continue to increase, and they're going to be able to sink a bunch of capital into their personal needs (when they clearly need to spend their energy on generating exports), into a technology that hasn't made it out of the lab? Yeah, no surer way than gunning down This road for achieving the ultimate population reduction measure (blow your limited income on fantasy shit while you lose the ability to pay debts and feed yourself).
Again, who is going to buy Japan's exports? The entire world is contracting. Growth has essentially peaked. The System doesn't work without growth.
What Japanese exports?? They priced themselves out of most markets in the early 1990's and moved most of their companies that produce components offshore to HK/China , Thailand , Indonesia and Taiwan ... They don't produce anything big (aircraft , ships) , their small stuff is now something they IMPORT... and they distributed auto's and electronics to countries closer to their final markets.
And this is exactly how the cycle goes... I don't get it with all the people lashing out as though it's some sort of orchestrated, conspiracy plan. It's an evolutionary thing. When people get older they tend to not do physical stuff all that well. In come the robots and the specialist human workers, out go the "factory workers." Infrastructures age, their costs to maintain go up, and then the businesses that require better functioning infrastructure relocate: it's how it works, convince the natives of your good intentions, move in and build up the infrastructure, which, for a short while anyway (before it turns into an aging heap), impresses the natives and inspires them to take on the costs of paying for it and for working harder. Exhaust... rinse and repeat...
The Japanese people are still unhappy with the idea of immigration.