"No Longer Reversible": China's Low Fertility Rate And Birth Restrictions Set Stage For Disaster

While China has embarked on ambitious plans for economic and military domination over the next several decades, they may end up defeating themselves without a single shot fired - thanks to their longstanding birth restrictions, shrinking fertility rate and exploding elderly population.  

Economically speaking, the problem is easy to understand; a shrinking labor pool due to restrictive reproductive laws tends to drive up wages, while a rapidly growing elderly population requires more spending on pensions and health care. "In a worse-case scenario, slowing growth and a labor shortage could leave China unable to care for hundreds of millions of retirees," notes the Wall Street Journal.

China’s clinging to birth restrictions defies a clear demographic trend: Its workforce is shrinking and the population is rapidly aging. By 2050, there will be 1.3 workers for each retiree, according to official estimates, compared with 2.8 now.

No matter what the government does now, it is too late to significantly change the overall trend because of social attitudes, say demographers such as Gu Baochang, a professor of demography at Renmin University in Beijing. -WSJ

While some experts have argued that slower population growth could mitigate pressure on China to create new jobs as technology increases productivity, others think China is in deep trouble...

They should have lifted all birth restrictions before 2010,” says Baochang. “Whatever steps they take now, China’s low-fertility trend is no longer reversible.” In three decades, 1/3 of China's population is predicted to be over the age of 60.

The chart below shows annual change in million persons (red line) and total child bearing population (blue columns).  From 2018 through 2033, China (with net emigration, to boot) will see an average annual decline of nearly 6 million Chinese capable of creating more Chinese (or the equivalent of losing the population of a Missouri, Wisconsin, or Maryland every year for at least the next decade and a half). -Chris Hamilton, Economica blog

Meanwhile, China's one-child policy, and now two-child policy, has conditioned the population to shun large families

In a generation that grew up without siblings, a one-child mind-set is deeply entrenched. Maternity-leave policies have been expanded but some women say taking leave twice is a career impediment. An All-China Women’s Federation survey found 53% of respondents with one child didn’t want a second.

Even without birth limits, China’s economic development would have reduced fertility rates, says Martin Whyte, a Harvard University Chinese-studies expert. That has been the pattern elsewhere in the world: When incomes rise, the sizes of families tend to go down. -WSJ

If the nation drops birth policies now, says Whyte, “China will learn what many other countries have learned—that it is much more difficult to get people to have more babies” than to force them to stop having them.

Rapid Aging

In May of 2017, Moody's cited China's rapidly aging population as a major factor in their decision to downgrade their sovereign rating, as an explosion in elder care is expected to erode household savings and strain government coffers - jeopordizing the government's already hefty debt load. The ratings agency predicted China's economic growth could potentially slow to around 5% over the next five years vs. a 2017 rate of 6.9%. 

“China is really interesting and unique,” said Marie Diron, a Moody’s analyst of sovereign risk, “because it is aging so much earlier than anyone else.

Compounding China's problem is the fact that it has one of the lowest retirement ages in the world, at 55 on average - while Beijing has been reluctant to implement a plan to gradually raise it. 

Officials had originally indicated they would present the plan last year. It was left out of measures unveiled at the congress in March, in which Beijing said the new ministry “will actively deal with the aging of the population,” with measures to develop the elderly-care sector and health-care reform.

Past policy changes haven’t fixed the trend—not even ending the one-child policy did. Newborns rose by 1.3 million in 2016, the first year without the policy—less than half the official projection—to 17.86 million, from 2015, according to the National Bureau of Statistics. 

In 2017, births slowed to 17.23 million, well below the official forecast of more than 20 million. -WSJ

Breakin' the law

China's reluctance to further soften their tone on birth restrictions is also leading to friction within local communities and at the workplace. 

When Ms. Li, the Qingdao professor, refused to abort her third child, she said, her university employer accused her of selfishly putting at risk her supervisors’ careers, the school’s future and co-workers’ bonuses. A university spokeswoman didn’t respond to faxed inquiries.

With the help of local church friends, her family moved to the Philippines, where she gave birth in November. -WSJ

Other countries with shrinking workforces have tried to stave off economic disaster by raising retirement ages or relying on immigration. Singapore, for example, has very liberal immigration policies and offers a "baby bonus" as high as 10,000 Singapore dollars ($7,500) along with grants available for parents which can be used for healthcare and education. 

Japan, meanwhile, has shuffled healthy retirees back into the workforce - along with various technological aides to make up for age-related deficiencies. 

In some cases, the solution lies in technologies that help offset senior workers’ deficiencies, like the exoskeletons used by Obayashi at its construction site. The Fujisawa Aikoen nursing home about an hour outside Tokyo started leasing the “hybrid assistive limb,” or HAL, exoskeletons from maker Cyberdyne Inc. in June.

At an office-building construction site in the center of Japan’s capital, 67-year-old Kenichi Saito effortlessly stacks 44-pound boards with the ease of a man half his age.

His secret: a bendable exoskeleton hugging his waist and thighs, with sensors attached to his skin. The sensors detect when Mr. Saito’s muscles start to move and direct the machine to support his motion, cutting his load’s effective weight by 18 pounds. -WSJ (2015)

"In Hokkaido, 60-year-old potato-pickers use rubber “smart suits” making it easier to bend over. Baggage handlers at Tokyo’s Haneda airport employ similar assistance," reports the Journal.

Back to China, President Xi Jinping has acknowledged the need to breed - stating in 2015 that China needs more births, while omitting a traditional reference to "family planning" in his party-congress report.

“I think Xi’s views about demography are clear: He considers population more as a resource than a burden,” said Huang Wenzheng, a researcher at the Center for China and Globalization, a Beijing-based independent think tank, and a co-founder of a hedge-fund firm that invests globally. “But of course he cannot easily abandon the family-planning policy because that would be a sharp turn away from his predecessors’ policies.” -WSJ

Geriatric Chinese scooter gang in the movie "Go Grandriders" 

 

Comments

mkkby Taint Boil Tue, 05/01/2018 - 01:14 Permalink

The low birth rate has nothing to do with gov't action.  China is overcrowded and choking on their own exhaust fumes.  Let's not forget dead pigs floating down the river.  Or people shitting at roadsides.

City chinks go around wearing masks so they can breathe.  Who the fuck wants more kids in a shit hole like that?  Obviously the people there have chosen not to.

China needs about 3 decades to clean up the mess they made industrializing so fast.  With over a billion to feed it's not gonna be easy or fast.

In reply to by Taint Boil

techpriest bshirley1968 Mon, 04/30/2018 - 23:06 Permalink

The worse part IMO is the feminism that goes with communism. Instead of focusing on family, women are encouraged to work and be good tax donkeys, and even abort kids who are born too early because they are in the way of career.

That said, there are 1.5 billion Chinese, if demographics led to the population going back to 1.0 billion and settling there, it wouldn't be the end of the nation or the Han people. However, it would wreak havoc on national finances.

In reply to by bshirley1968

BarkingCat techpriest Mon, 04/30/2018 - 23:41 Permalink

China could drop to 200,000 million and it would not be under populated. 

These crashing demographics stories are idiotic doom and gloom fantasies. 

The worse that will happen is that there will not be sufficient numbers of younger people to take care of the old and the old will die sooner. They will feel that they are abandoned and alone, fall into depression, lose their will to live and die.

Sounds horrible to some but in a grand scheme of things they will still have it much better than people did historically. 

In reply to by techpriest

techpriest BarkingCat Mon, 04/30/2018 - 23:48 Permalink

When you put it that way, it will disproportionately affect the ones that didn't have any kids to begin with, and as such I see the cycle as self-correcting long term. Again, I am not worried about whether there will still be Han Chinese 500 years from now - plenty of people in the countryside are making babies. However, building a financial system assuming non-stop population and productivity growth was going to hit a wall sooner or later.

In reply to by BarkingCat

Faeriedust Etteguj Guj Tue, 05/01/2018 - 16:25 Permalink

The Chinese people alive today were born into a totalitarian state and have lived in it all their lives.  You don't generally miss what you never had. Their classic philosophies all stress the importance of social stability, conformity to community expectations, and good government -- not individual profit or liberty.  The social credit system is nothing more than automation of the local Party member keeping tabs on who doesn't take out the trash or plays their radio too loudly.  The people are used to it and nowhere near as rebellious as the Russians were under even the best of Soviet governments.

In reply to by Etteguj Guj

keep the basta… directaction Mon, 04/30/2018 - 23:49 Permalink

Japan has excellent  organisation re retirees, if they want, a quick interview and allocated to  work they can do, few hours a day for low wages. Everyone wins. Plus excellent scientific research eg re asthma actual causes, or cure of cataracts. No big pharma exploitation and blocking.

With climate change expect millions will die as they have several times in the last 2 millennia. Dont think the demographics a worry as its based erroneously on things proceeding as they have in the short term past.

In reply to by directaction

Faeriedust keep the basta… Tue, 05/01/2018 - 16:31 Permalink

That last is the most important.  Don't believe demographic projections -- or any other kind of projections done by your average modern statistician.  They're all full of bogus numbers and based on very short-term trends.  Nobody who has any kind of long-term perspective can get a job in service to the modern world.  "Modern" derives from a French term for "fashionable".  It points out the ridiculously short-term outlook of all the PTB during the last century as well as the ubiquitous tendency towards fads and groupthink.  Any social projection made by a member of the credentialed intellectual elites is subject to these flaws.

In reply to by keep the basta…

uhland62 directaction Tue, 05/01/2018 - 00:14 Permalink

With robotics and AI payments from ever fewer individuals being in paid employment this revenue source dries up. Production will still be there and become the revenue source; it requires a change in thinking, OMG!!

And then there are 489,000 foreign students in China; many want to stay if they find employment. That's quite a source of young people without oldies attached. 

In reply to by directaction

shortonoil yomutti2 Tue, 05/01/2018 - 08:16 Permalink

Human male sperm count has fallen by 50% in the last 40 years, and no one knows why? At its present rate of decline our species will be facing eradication in a few generations. Chinese like ghost cities of the world will soon become the norm rather than the exception. The level of the DOW will become very irrelevant. Your childrens' children will find nothing but death awaiting them!

In reply to by yomutti2

roddy6667 Zero-Hegemon Tue, 05/01/2018 - 06:28 Permalink

There is no immigration in China. You can get a resident visa if you are lucky and your presence is of benefit to China. Everybody else is strictly a very temporary visitor. They are protecting their culture.

The Chinese system of keeping the elderly in the home with the family will help them deal with the changing demographics. In America, you have three houses for three generations. When the old people can't take care of themselves any more, they are shipped off to a Soylent Green Waiting Facility, often at taxpayer expense. A

merican readers think the whole world uses their extravagantly expensive system of taking care of the elderly. Most countries are not that dumb. 

In reply to by Zero-Hegemon

Son of Captain Nemo Mon, 04/30/2018 - 22:21 Permalink

I stopped reading after I saw the WSJ contribution!...

No worries...

I understand Zionist Jews like Asian women and are looking for a new crib after they realized the Black Sea beach property wasn't going to happen for them after 2015!...

Bull Bear Nice Pair Mon, 04/30/2018 - 22:23 Permalink

China has only about 10% of the world's arable land, yet she has to support 20% of the world's population. Some idiots want China to have more people? The real demographic time bomb is in West Europe and Japan, not in China.

techpriest LetThemEatRand Mon, 04/30/2018 - 23:13 Permalink

IMO the only legitimate "expanding wealth" model is the "repair" mindset in Christopher Alexander's "Timeless Way of Building." Namely, a family or community of fairly stable size build lasting tools and structures, and over time he accumulated wealth makes the next generation's survival and ability to do new things that much easier. Note that debt is not needed in such a model.

In reply to by LetThemEatRand

Blankone Bull Bear Nice Pair Mon, 04/30/2018 - 23:00 Permalink

I do not know why people cannot see this. There will be change and a transition as the population curve changes, but what is the result of continuous over breeding? Over taxing the capacity of the land, pollution explosion, shortages of clean water, crowded like sardines?

Anyone who pays attention of nature should know how unchecked population explosions in nature get resolved.

How much better would the US be if the population went flat in 1960 and NO immigration was allowed?

In reply to by Bull Bear Nice Pair

Faeriedust FluffyDog6 Tue, 05/01/2018 - 16:53 Permalink

And there you have it.  Everything in Anglo-American society must revolve around keeping the Rich, rich, and making sure they can keep getting richer.  Because . . . they beheaded Charles I and made every king after that sign a contract ensuring that he/she/it would lick their feet.  The first Bill of Rights was the one signed by William of Orange in return for the proffer of the English crown.  The American Bill of Rights was an afterthought, created to convince the mostly southern states that didn't want to assume Massachusetts' revolutionary war debts to sign the Constitution.  Because of course the bankers who bankrolled the Revolution (so as to increase their own profits) needed to be paid.

Someday, perhaps, Americans will wake up and realize that there is no Divine Law that the Rich (and the Bankers) must dominate society and govern all things for their own profit.  Someday . . .

In reply to by FluffyDog6