Here’s more evidence that the “recovery” never really happened, and good reason to think that the entire social safety net structure is doomed to fall apart.
The birthrate, long tied to economic growth, has been dropping to its lowest point in recorded history – both nationally and, in particular, in the state of California.
This demographic shift is bad news for the economy – in terms of housing, consumer markets, and especially for the long-term funding of social security, medicaid, medicare and other obligations that younger generations have typically been expected to pay into.
Whether or not you agree with the system in place, the fact that it is virtually certain to go bankrupt before the generation of baby boomers shift off this mortal coil should be troubling to everyone planning a future in the United States.
Official numbers show that the birthrate began to steadily decline in 2008 when the crisis hit and – unlike even during the Great Depression – hasn’t ever picked back up. 2016 saw the lowest point ever for California, even with higher births from immigrants factored in.
via the L.A. Times:
California’s birthrate dropped to its lowest level ever in 2016, according to data released by the state’s Department of Finance.
Between July 2015 and July of this year, there were 12.42 births per 1,000 Californians, the agency said this week. The last time the birthrate came close to being that low was during the Great Depression, when it hit 12.6 per 1,000 in 1933.
But, unlike after the Depression, birthrates haven’t bounced back quickly as the economy has picked up.
California has been experiencing a years-long downward trend that likely stems from the recession, a drop in teenage pregnancies and an increase in people attending college and taking longer to graduate, therefore putting off having children…
“Eventually you think about having a child and by this point in time you’re in your early 30s,” he said… when women’s fertility begins to decrease…
Similarly, the national birthrate began falling in 2008 and continued to do so through 2013, when it hit a record low of 12.4 per 1,000 people.
Already, states and cities are unable to meet their pension obligations. A very bad game of musical chairs is in the works, and unless something major changes, it could spell ruin for aging generations to come, who will be forced to contend with a shrinking pool of support – both officially and unofficially – from younger generations.
As the Wall Street Journal reported earlier this year:
Sales of single-family homes are being weighed down by what Robert Dietz, chief economist at the National Association of Home Builders, calls “the great delay,” the trend of millennials postponing milestones like marriage and having kids. Other ripple effects take years to show up, such as the drag of having fewer young workers paying into Social Security and Medicare…
“Everything is slower than we expected,” said Sam Sturgeon… he predicts that the total fertility rate won’t go above 1.9 babies per woman for the next five years or longer. An ideal birth rate is around 2.1 babies per woman, demographers say, since that’s the rate that’s needed to replace the current levels of population.
Right now, there is considerable optimism about a renewed age for the free market in America. Business is being wooed back by President-elect Trump.
But in the long term, the demographic pressures could impact the care and survival of the population. All the more reason to prepare for the worst, and reduce one’s dependency on the system as much as possible.
As Michael Snyder explained, the upcoming generation of “snowflake” millenials are, as whole, reluctant to move out of their parent’s basements, have difficulty finding real jobs, are stifled by student loans and a lifetime of debt, are putting off marriage and children – and consequently, will be inadequately prepared to financial support older generations as they age.
What if social security and pensions aren’t there when you need it? What if, even after being forced to pay for Obamacare, health care is adequate or even inaccessible?
At the individual level, this is a clear incentive to prepare, and attempt to build a self-sufficient life that is not reliant on social programs or future-promises of assistance and support.
Promote your own health, and that of your family, and create a back-up plan in case one’s position in the pecking order of society should slip and fall, income should fade or medicines and health care should become out-of-reach.
The same tips to prepare for an emergency can be applied to the long game to prepare for a future of bankrupt and inept social services.