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Fear of a Gray Planet
Megan McArdle has a perspicacious piece in the new Atlantic on the likely economic and cultural effects of the aging of America's population. You ought to read it in full, but for a potted summary: likely slowdown in macro economic growth statistics as more Americans' needs shift from goods (where productivity growth is strong) to services (where it isn't).
She gently debunks the somewhat common fear of a huge stock market crash as the aging Boomers start selling off the stocks they've socked their savings in for decades. But she does think that double digit yearly stock market index growth is very unlikely down the line.
The implicit advice to the young? Go into geriatric medicine. Implicit advice to America? We'll need more immigrant service workers. (Paging Kerry Howley.) Implicit rebuke to aging Americans? You maybe shoulda thought about having more kids. (Paging Bryan Caplan.) And expect to see more graying heads in service occupations, as many Boomers didn't save enough to sustain them through their increasing golden years, and they'll have to keep working past standard "retirement" age, and Social Security won't sustain them. Nor will it bankrupt the Republic, in her reading--though Medicare just might.
Read the whole thing. It ends with a pleasing "life will go on, and still be sweet" tone, despite the possibly scary-sounding economic and cultural shifts she discusses.
|1.16.08 @ 12:09PM|#
I read today where the US fertility rate has risen to 2.4, which is above replacement. If that is the case, doesn't that mean the US is going to age a lot less than predicted? Also, I think some of the birth dearth is due to a lag that resulted in this generation waiting longer to have children. The normal birthrates expected when people hit their 20s aren't happening now until people hit their 30s creating an apparent birth dearth when those people are in their 20s. Some of the growth in fertility is due to high fertility Hispanic immigrants, but not all. Even non-Hispanic whites now have a fertility rate slightly above two. The fertility rate in this country seems to be rising, which I think puts a lot of those "old America" predictions in jeopardy.
Episiarch|1.16.08 @ 12:11PM|#
Can we stop calling them "boomers" and start calling them "narcissistic parasitic assholes", which is much more accurate?
Bingo|1.16.08 @ 12:17PM|#
If America becomes like that small town she described, you are
going to see a lot of young people move out (just like that small
town she described).
Because fuck serving statist narcissistic geriatric assholes for a
living.
|1.16.08 @ 12:22PM|#
We're the most fertile country in the developed world and you're worried about aging?
|1.16.08 @ 12:24PM|#
It should be added (as John has noted above) even if you
included only non-hispanic whites, we'd still the most
fertile in the developed world.
I don't know whats slowing Europe's growth, but it doesn't seem to
effect us here.
|1.16.08 @ 12:25PM|#
If America becomes like that small town she described, you
are going to see a lot of young people move out (just like that
small town she described).
Given that this phenomena occurring throughout the western world,
where are they gonna move?
The places where fertility is increasing don't exactly have the
allure of the Big City. Sub-Sahara Africa, anyone?
|1.16.08 @ 12:27PM|#
Make that "is occurring" - damn! I can't seem to make a post anymore without dropping at least one word...
|1.16.08 @ 12:29PM|#
Can we stop calling them "boomers" and start calling them
"narcissistic parasitic assholes", which is much more
accurate?
I've been called worse.
|1.16.08 @ 12:34PM|#
I forsee the loosening of chicken restrictions setting us up for a world saving bout with the bird flu.
|1.16.08 @ 12:35PM|#
I don't know whats slowing Europe's growth, but it doesn't
seem to effect us here.
You're not going to like this much, but I suspect religious
participation and values plays a bit a role here. The groups in
this country that are growing tend to be the ones that are most
religiously active.
Europe, being largely secular, doesn't have those incentives.
From a purely materialistic viewpoint, reproduction doesn't make a
lot of sense...
|1.16.08 @ 12:40PM|#
You're not going to like this much, but I suspect religious participation and values plays a bit a role here. The groups in this country that are growing tend to be the ones that are most religiously active.
Maybe, but I think lower population density plays a role. You can't
have a lot of kids unless you have a big house, and if you live in
a place like Amsterdam were a shoebox can go for $200,000 you won't
have many kids.
This seems to hold up because Scandinavia, believe it or not, has
higher fertility--along with lower population density--than the
rest of Europe. This despite record low church attendance.
|1.16.08 @ 12:41PM|#
Pig, I'm an athiest but I had four kids in the hopes that I could maintain my materialistic ways into my old age.
|1.16.08 @ 12:43PM|#
Let me be clear that I'm not saying explosive fertility is a
good thing. But going below replacement rate isn't, either, unless
you're China or India.
Slightly above replacement rate--slow, steady growth--seems about
right.
|1.16.08 @ 1:13PM|#
MR. MCQUIRE
Ben - I just want to say two words to you - just two words
BEN
Yes, sir.
MR. MCQUIRE
Are you listening?
BEN
Yes I am.
MR. MCQUIRE
(gravely)
Old Hippies
They look at each other for a moment.
BEN
Exactly how do you mean?
MR. MCQUIRE
There is a great future in old hippies.
Think about it. Will you think
about it?
BEN
Yes, I will.
MR. MCQUIRE
Okay. Enough said. That's a deal.
Brian|1.16.08 @ 1:25PM|#
I don't see why having more kids is good for your finances per se. Sure, they might support you in your old age, but that's far from guaranteed, and if you saved the money that you would have spent raising them, you could support yourself. There are plenty of reasons to have kids, but economically speaking they're a poor investment.
|1.16.08 @ 1:27PM|#
You're not going to like this much, but I suspect religious
participation and values plays a bit a role here. The groups in
this country that are growing tend to be the ones that are most
religiously active.
This is admittedly a pretty cracky, Anton Wilson-esque speculation,
but I wonder sometimes if this feat isn't something secular culture
could learn to emulate in time.
Part of the root of humanist fear of religion in the modern,
Western world is, I suspect, based on a misunderstanding of
religious attitudes toward sexuality. There are doubtless religious
theorists who actually are anti-sex, but for the most
part, religious sexual morality is simply rooted in a societal
structure that is alien to the urban secular humanist - the social
structure of the agrarian town, which was for most of history the
basic substructure of civilization itself.
Agrarian mores aren't actually anti-sex (as any medieval scholar
could explain at length), they just connect sex with reproduction
in a way that's weird to someone raised in contemporary
society - particularly in Anglophone countries, where the world of
children and family are widely understood to be irreconcilable at a
fundamental moral level with the existence of adult
sexuality.
A lot of adults today profess not to want kids because they're an
economic burden (which they are), or because they "don't like
kids"; I suspect that in many cases, the root of the very emotional
objection to the raising of offspring is the notion that childbirth
represents the boundary between youth and individuality and bland,
sexless seniority.
Whereas I don't think there is necessarily a fundamental conflict
between family and what urban, secular adults want out of life,
only between broad modes of living based on value-sets taken for
granted in American society. I would be happy to explain how I
believe this shortchanges children as well, but that issue falls
outside the scope of this particular speculation, so: another
time.
Fluffy|1.16.08 @ 1:33PM|#
The Medicare bomb is the scary one, because it coincides with
other ticking bombs:
1. Massive numbers of doctors and RN's are themselves baby boomers,
and will begin to retire.
2. We haven't been producing medical professionals domestically at
replacement rates, but have plugged the gap by importing medical
professionals from east Asia and the subcontinent. That flow will
slow to a trickle and then stop as those societies grow wealthy
enough to pay their doctors to stay put.
3. One way that the Medicare crisis will be dealt with is by
stiffing providers by slashing reimbursement rates.
The combination of 1-3 has the potential to turn our hospitals into
medical ghost towns that will look like the last chapters of a
medical Atlas Shrugged. The steps our government is likely
to take in response to such a crisis are not pleasant to think
about.
|1.16.08 @ 1:37PM|#
Brian, on an individual basis kids probably are a poor investment. But overall, the economy and thus individuals benefits from the stimulus of diaper, food, toy and electronic manufacturing. Our standard of living as compared to the lower fertility nations shows as much.
Brandybuck|1.16.08 @ 1:45PM|#
Making a distinction between manfacturing and service sectors is
a mistake. This is a relic of the bad economics of the 1930's.
Goods are not superior to services.
Do we want our economy devoted to producing cheap plastic doodads,
or engaged in software engineering, genetic research, and cutting
edge medicine? The former are goods, the latter are services. I
don't know about you, but the latter sounds like a more vibrant
economy.
|1.16.08 @ 1:54PM|#
Brandybuck, Until you have to fight a war. Anyway your economy would result in the boomers living forever, which can't help the situation.
|1.16.08 @ 1:58PM|#
I commented on Megan's blog that she shouldn't be looking at
Italy for the future but Japan.
In 15-20 years we will have personal care robots that can bathe,
feed and otherwise care for seniors. Combine that with cars that
drive themselves allowing for automatic deliveries from Wal-mart
and Food Lion and the productivity increases we will be seeing in
these sectors will be staggering.
Thomas Paine\'s Goiter|1.16.08 @ 2:02PM|#
What do the Ron Paul newsletters say about this topic?
----------
Matt Welch is a vile racist.
Thomas Paine\'s Goiter|1.16.08 @ 2:04PM|#
Can we stop calling them "boomers" and start calling them
"narcissistic parasitic assholes", which is much more
accurate?
You rule, es.
----------
Matt Welch is a vile racist.
|1.16.08 @ 2:21PM|#
Episiarch - I already do, sir - I already do.
Hale: that's very interesting and I think you're on to
something.
|1.16.08 @ 2:39PM|#
I think you are right James B. Also, I think information technology will be better adapted to the medical profession allowing doctors to be more productive. All of course assuming some well meaning do gooder doesn't come and enforce socialism on the medical sector and freeze technology at current levels in the name of fairness.
LarryA|1.16.08 @ 2:40PM|#
I don't see why having more kids is good for your finances
per se. Sure, they might support you in your old age, but that's
far from guaranteed, and if you saved the money that you would have
spent raising them, you could support yourself. There are plenty of
reasons to have kids, but economically speaking they're a poor
investment.
Only on a micro level. You personally will be better off
financially if you hoard the resources you would have spent raising
children. But on a macro level, if too many people copy you you'll
end up in a society where there aren't enough workers to produce
what you hope your savings will purchase.
Besides, no kids>>no grandkids. You have to spend your golden
years playing with dogs and cats.
|1.16.08 @ 2:41PM|#
Sorry if this is a repeat, but I haven't had a chance to read
all of the comments yet.
Couldn't we just send all the old people to India to be taken care
of?
|1.16.08 @ 3:01PM|#
I think anyone who wants to outsource their old people to India should be allowed to. We are keeping our old people, and caring for them, because they help us take care of the kids and we can't afford nannies.
Sam Grove|1.16.08 @ 3:06PM|#
Aren't we going to turn all the drudge work over to
robots?
Aren't we going to fix the aging problem medically?
Hey! Where's the future?
|1.16.08 @ 3:16PM|#
Sam Grove,
I don't think the idea of a robot-driven economy is remotely a
ludicrous fantasy. I think it's both a plausible and desirable
outcome, and one that would improve society in a number of
immediate ways.
Having said that, I'd still argue that the earliest point
at which it should be permissible to count on a particular outcome
for policy purposes is when it is some working model has
been constructed. So far, neither the wholesale divestment of human
labor to technology nor a cure for aging have been demonstrated in
any tangible way.
Oh well. The future is apparently later.
|1.16.08 @ 4:06PM|#
"""I am all for it as well. Where the hell is my robot
prostitute?"""
Irobot is currently working on an attachment for its roomba vacumn
cleaners for just that purpose. They also have a version for their
military bots that can kill level an enemy compound and satisfy a
company of Marines on a single charge.
GILMORE|1.16.08 @ 4:12PM|#
i have some comments on the Boomer piece in the atlantic (having
done lots of forecasting on the economic impact of future
demographic changes)... but they're not all that big a deal. The
short of it is that we need immigrants. They make babies. We need
their babies.
..to make rejuvination medicine from... bwooo ha ha haha ha
ha!!
ahem. Kidding.
Anyhoos, the more interesting libertarian red meat in the Atlantic
this month was the article "First, Kill All the School Boards"...
about public education failures in America.
Sounds good from the title, but if you read it, it boils into an
argument for getting rid of all localized variance, and having one
big ol federal mass-education program like the Germans and the
Japs.
The boomer thing is kinda a mixed bag, and doesnt have a whole lot
of obvious take aways. Other than our healthcare system is going to
get even more expensive. Most of which will come out of young,
healthy people's paychecks.
"Welcome to the Monkey House" is a really good book. It almost
makes you think of Vonnegut as sorta libertarianish.
|1.16.08 @ 4:25PM|#
Jake,
I was thinking more along the lines of a young Melanie Griffith in
Blade Runner.
|1.16.08 @ 4:56PM|#
I was thinking more along the lines of a young Melanie
Griffith in Blade Runner.
Or Daryl Hannah in Cherry 2000 ;-}
|1.16.08 @ 5:28PM|#
What is the immigration debate but a bunch of old people yelling "Get the hell off my lawn!"?
|1.16.08 @ 5:41PM|#
"The implicit advice to the young? Go into geriatric
medicine."
Don't do it!
With government interference, a large and growing market does not
guarantee high wages.
As a doctor, you can only fix one arthritic knee at a time.
Who pays for this when you're retired? Some government health
plan.
What's their number one goal going to be? Offer services while
keeping down costs.
How much are they going to pay you?
As little as possible.
Go into plastic surgery instead.
|1.17.08 @ 8:58AM|#
"Making a distinction between manfacturing and service
sectors is a mistake. This is a relic of the bad economics of the
1930's. Goods are not superior to services."
Megan McArdle was not making a value judgment, Brandybuck, and the
distinction she made is valid -- it's easier to increase
productivity in manufacturing goods than in providing
services.
As for robot servants and cars that drive themselves -- people have
been predicting these things for over 50 years. Don't hold your
breath.
LarryA|1.17.08 @ 10:27AM|#
Do we want our economy devoted to producing cheap plastic
doodads, or engaged in software engineering, genetic research, and
cutting edge medicine? The former are goods, the latter are
services.
Really? Software is a product. It comes on CDs in boxes, or
computer downloads. Genetic research leads to GM products. Cutting
edge medicine produces procedures like in-vitro fertilization and
products like artificial skin.
"Services" includes everything from the clerk who sells you the
software to the physician who places the artificial skin.
|1.17.08 @ 2:15PM|#
"Can we stop calling them "boomers" and start calling them
"narcissistic parasitic assholes..."
Jeez, if I'd have known what was going to happen, I'd have asked my
parents to have me at a different time. Oh, wait.
Good thing no one had to take care of you when you were a helpless
child, 'cause that would have been "for the children".
Self-centered buttplug.
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