WSJ: “Americas Baby Bust”:
The nation’s falling fertility rate is the root cause of many of our problems. And it’s only getting worse.
The replacement rate is 2.1. If the average woman has more children than that, population grows. Fewer, and it contracts. Today, America’s total fertility rate is 1.93, … it hasn’t been above the replacement rate in a sustained way since the early 1970s.
Low-fertility societies don’t innovate because their incentives for consumption tilt overwhelmingly toward health care. They don’t invest aggressively because, with the average age skewing higher, capital shifts to preserving and extending life and then begins drawing down. They cannot sustain social-security programs because they don’t have enough workers to pay for the retirees. They cannot project power because they lack the money to pay for defense and the military-age manpower to serve in their armed forces.
The article touches on, but does not examine fully, the variation in fertility by economic class (and its implications for taxation, education, health care, and other public services).
The author does note (as we discovered when examining demographics while I was on the State Board of Education), that population growth is being fueled by immigration (and on the state level for our state at the time, migration), not by replacement.
I wonder to what extent this demographic shift in developed countries (which is more pronounced in Europe than the U.S.) is an underlying cause of higher tax rates in European countries.
Via Dave Pell’s Next Draft