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Strategies & Market Trends : 2026 TeoTwawKi ... 2032 Darkest Interregnum -- Ignore unavailable to you. Want to Upgrade?

To: elmatador who wrote (61216)	2/16/2010 4:56:11 PM
From: carranza2	Read Replies (1) \| Respond to of 217645

You have circled around the Chinese demographic difficulty, which is substantial, but did not get quite to the heart of it. The one-child policy was a disaster. It will result in a declining population just as the bulk of the population ages and becomes less productive. If you want to see what happens to an economy with a population that ages and declines in number, Japan is a good example. The Japanese shot themselves in the foot twice by not opening things up for women, as we did. In order to keep a population stable, each family in any nation has to produce, on average, slightly more than 2 children [the 'slightly more' relates to children who die young]. Each child replaces the mother and father and the fractional child replaces the ones that die in childhood. A one-child policy guarantees a declining population just as the bulk of it ages. Since there is no large social network for the aged, a married couple, as you say, will be supporting four parents. This will be very difficult because the young couple will be most economically stressed as it raises its own child or children. And thanks to medical progress, the elders will live longer, exacerbating the stress. Naturally, the Chinese populace knows all this, so it saves rather than consumes. It is a matter of simple practicality, not necessarily virtuous, but is instead a simple recognition of 'this is the way it is.' In order to keep economic growth going in a nation with a declining population base, productivity gains have to be enormous. This is more difficult to do with an aging population because they cannot work as hard, are sicker, retire, etc. China will have to spend some of its cash on social services, including retirement income and medical care, for the aged. Otherwise, the social pressures are going to build. All I can say to the Chinese is, welcome to the First World, where these things are in place and are very budget-busting expensive. They are definitely a reason why we are not as competitive as before. Social services cost lots of cash. But congrats again to Jay, who is doing what he can to combat the demographic conundrum China faces. The other demographic problem China faces is that its population is very much skewed to males because of a preference for boys I don't quite understand. Lots of abortions of girls in the past, though I don't know if that is still the case. Assuming most women marry, this means that there will be a lot of single men who cannot find a mate. This is also not good for social stability, as the Muslims have shown. The Chinese demographic planners decided to mess with Nature, not a good thing.