solving aging with immigration?

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    Remember the media hype about how Australia needed to rapidly increase its population because of the dreaded age demon? The flaws of this argument quickly became apparent, silencing its proponents. As the following article shows, when you try to quantify the idea of maintaining a 'young' population you get some exponential results!


    Europe's population growth is on the verge of turning around, and the almost universal reaction has been panic at the prospect—as if the population it so recently attained is essential to its survival. The reaction illuminates the general infatuation with growth. We heard few questions raised as population grew, but the end of growth is seen as a disaster. I think this topic needs more serious thought and a less visceral reaction.

    The UN and "Replacement Migration." The popular press reflects the fear that there will not be enough labor to support aging populations in Europe and Japan. The UN Population Division has taken up the issue and has published projections showing how much "replacement migration" will be necessary to maintain (1) the present population, or (2) the numbers of working age people, or (3) the present ratio of working-age to retired-age populations, in several European countries, the European Union, Europe as a whole, Japan, Korea and the United States.47

    The Population Division calculates that all the countries studied, except the United States, will need to raise immigration rates to avoid population decline. The most dramatic projections are those under projection (3) above: the immigration necessary to maintain a constant ratio of working age residents to those over 64. At the extreme, Korea would require more than 5 billion immigrants by 2050, raising its population to 6.2 billion, almost none of them of Korean ancestry. Europe would need 1.4 billion immigrants, for a population of 2.3 billion. For Japan, the numbers are 524 million and 818 million. And, although the point is not made explicit, the migration and populations would presumably continue to grow after 2050. The Population Division, by the very act of publishing such projections, evidently meant to suggest their absurdity and thereby make the point that immigration is not a solution to what is happening in those countries. The report points out that those are projections, not recommendations. By focusing on ways to maintain population and working age levels, however, the Population Division seems to have concurred in the general public malaise at a population turnaround.

    This is a legitimate area for exploration by the Population Division, but I have three fundamental problems with the UN approach.

    1. It implicitly treated maintenance of present populations as a desirable goal. (The subtitle itself suggests that declining populations require "solutions.") Projections (1) and (2) become largely academic if that is not the goal. The report would have been more balanced if it had acknowledged the gains to be realized from smaller populations.

    2. The authors treat immigration as the only tool to address the aging of European populations, pointing out that "only international migration could be instrumental in addressing population decline and population aging in the short to medium term." In fact, as I shall describe later, the dependency ratios are favorable in the short term, population declines are a long term rather than a short-term phenomenon, and as the report itself makes clear, immigration is not a feasible long-term "solution." The report would have sounded considerably less apocalyptic if it had studied the demographic implications of a rise in fertility. (It touched only briefly on one consequence of a return to the fertility levels in the UN 1998 high projection.) That would have dramatized the importance of bringing fertility back toward replacement level, which ultimately is the only alternative to national submergence or disappearance.

    3. The report would have been more useful and realistic if the authors had studied employment and its possible expansion, instead of falling into the "working age" trap. By looking at employment rather than "working age" populations, it would have focused attention on a vital question (which it touched upon only in one phrase): how do those societies get more of their members back to work?

    The European Environment. Let me propose a very different view: a smaller European population will be good for Europe and for the world, and the transitional problems are manageable, if difficult. Recent world growth has put very heavy pressure on the environment. It has driven up the natural carbon, nitrogen and phosphate load in the biosphere, generating fundamental changes in the world ecology. It has led to water pollution and atmospheric acidification, and it drives the worldwide problem of atmospheric carbon loading and climate change. Europe and Japan are two of the most crowded regions on Earth. Western Europe has grown by 27 percent since 1950, Japan by 50 percent. With populations more like those of 1950, or even earlier, they could enjoy the benefits of prosperity without the environmental costs that have come to characterize it.

    Europe is in a better position than most of us to plan for sustainability, because its population has stopped growing. However, it has some serious disadvantages resulting from past growth. Its environment is under intense pressure simply because it is so densely populated. For one typical example: sulfur oxide (SOx) emissions in the major European countries are much less than in the United States, judged by emissions per capita or emissions per dollar of GNP. But judged by the truly relevant measure of emissions per square kilometer, Germany, Italy, and Spain emit about twice as much sulphur oxides as does the United States.48

    Comparable figures can be run on other pollutants. European forests are under more intense stress than ours are from acid precipitation and ozone, simply because the pollution is concentrated in such a small area. Pesticide use per hectare is triple ours. Fertilizer use per hectare in the European Union is twice that in the United States because they pursue maximum yields and pay inflated prices for food, which in turn leads farmers to use more fertilizer. Consequently, the rivers run full of the residues. The nitrogen load of the Thames is four times that in the Delaware River and 200 times that in the Nile. The Dutch and Danes must scale back a major industry, hog farming, because the pollution has proven intolerable. In Austria, 35 percent of mammal species are endangered, 37 percent of birds and 66 percent of the fish; for the United States, the figures are 10 percent, 7 percent and 2 percent.

    A lower population will be a tremendous asset as Europe tries to come to terms with its environment. It will also be a major help in addressing the energy transition, because Europe is not well-endowed with fossil fuels or with wind-energy sites or sunlight for solar energy. Those who panic at Europe's population trends should consider those advantages.

    Dependency Ratios. Those who are obsessed with the decline of the "working age population" compared to "dependents" forget that they are fuzzy constructs. The real question is how many of the people are employed? The proportion of the "working age" that is actually working varies wildly from society to society and over time. Many of the so-called "working age" people are highly expensive dependents, such as college students or policemen, firemen and retired military personnel retired at or near full pay. In Japan and to some degree in Europe, the standard public and private retirement age is 60, not 65.

    Moreover, there is no very precise connection between dependency ratios and economic success. The present dependency ratios in Europe are supposedly highly "favorable", i.e. lots of working age people and relatively few children and older people—but unemployment is Europe's greatest economic problem. It drives the constant demand for more economic growth.

    The Case of Italy. Let me use Italy as an example, because it supposedly faces a particularly dire future due to a declining population.

    To keep the "working age/65+" ratio constant, says the UN report, Italy would need "a total of 120 million immigrants between 1995 and 2050 . . . an overall average of 2.2 million immigrants per year. The resultant population of Italy in 2050 under this scenario would be 194 million, more than three times the size of the 1995 Italian population. Of this population, 153 million, or 79 percent, would be post-1995 immigrants or their descendants."

    Does anybody seriously think that Italy can grow to be almost as populous as the United States—that it would be environmentally bearable? Or, for that matter, that such migration levels would be tolerable? What those projections show most clearly is the limits of migration as a solution to an aging population.

    Now let us take a more sober look at Italy's future. How desperate does it really look? Let me put it this way: only 52 percent of the "working age" population (15–64 years old) is presently employed, because of chronic unemployment coupled with liberal welfare and retirement benefits. By contrast, the ratio for the United States (adjusted to the same ages) is about 73 percent. If Italy by 2050 put the same proportion of its working age population to work as we now do in the United States, then 39 percent of the total population would be working—which is higher than the present 35 percent.49 Those people, not the hypothetical "working age population", are the ones who support the rest. Some of the unemployed would be happy to have jobs; others presumably would grumble if they had to work, but the potential labor will be there.

    Not a frightening prospect—if they can get those people to work.

    There is a simple truism: an older population is an inescapable byproduct of the end of population growth, unless the growth is stopped by rising mortality. Unless they want to attempt the mathematical absurdity of perpetual growth, all nations will have to face that reality, and Europe is there now.

    Europeans must decide to have more children again if their nations are not to disappear. Italy should be moving toward a smaller population but not so fast. A higher fertility rate would still lead to a smaller population, but it would slow down the aging process and ameliorate the problems. They need to ask themselves: what fertility level is desirable?

    Let us examine three different population scenarios for Italy.

    In the two graphs above (see published book for graphs), I plot Italy's population and dependency ratios through the coming century, using three different sets of assumptions:

    1. Current Fertility of 1.2 and zero net migration, with current mortality (on the assumption that decreased budgets for medical care—especially for the old—will counterbalance medical improvements leading to greater longevity).

    2. Rising Fertility, to replacement level (total fertility rate or TFR of 2.05) in 2020, staying constant thereafter

    3. The "Immigration Scenario", with annual net immigration of 200,000 men and women (in equal numbers), added to the preceding scenario.

    (Note that I am using the UN definition of "working age"—15 to 64 years. The UN study ignored the young dependents, on the grounds that on average they cost much less than old dependents. Following a more traditional approach, I have included them; they impose educational costs and hidden costs of job opportunities foregone.)

    The Current Fertility scenario—or any scenario short of a fairly swift return to replacement level fertility—is indeed frightening once fertility has gone as low as 1.2 children. In Italy, current fertility would lead to a population descending past eight million in 2100—14 percent of the present population—unless immigration fills the decline. A rise to 1.6 children would lead to a population in 2100 of 15 million, and still declining. Given the intense migratory pressures generated by third world population growth and by the demands of employers in Italy for labor, extreme low-fertility scenarios would probably be overwhelmed by migration.

    With zero net migration, the Rising Fertility scenario would lead eventually to a population stabilized at about 40 percent of the present level, which is not much different from the population at the beginning of the 20th Century. It results in a brief peak in the dependency ratio, but after 2050, the dependency ratio would begin to improve. That strikes me as a rather attractive scenario. The vital issues are, how do they achieve that higher fertility, and how much immigration will they accept if they do not? They may need to reconsider their traditional aversion to immigration—but at levels far more reasonable than the UN "replacement immigration" scenarios.

    The Immigration Scenario holds the dependency ratio down. It preserves a larger population, if that is what they want, but it would transform Italy as post-2000 immigrants and their descendants become about half the total population. It is not unthinkable. Italy has gone through massive immigration before; Roman Emperor Trajan was of African descent. But that scenario would lead again to growth unless immigration or fertility declines.

    Those are just three of an infinite number of possible scenarios.

    Europe's Shared Issues. Italy and Europe will have real adjustment problems as the workers age. The problems will be more acute because of the speed with which fertility has fallen. But they are problems to be solved, not a fundamental threat. The medical care burden will increase, which may require that some benefits be capped. Early retirement and six weeks of annual vacation may disappear for a time. New arrangements may be needed, like matching older people with jobs suitable for them, or pairing up two semi-retirees to cover one job.

    A world of free trade may become simply intolerable for Europe. It will be at an immense competitive disadvantage. Its workers will be in a position to command high salaries, but European products will be competing against developing countries with a labor surplus and consequently low wages. If Europe can manage that threat, European labor will be in an enviable position.

    It will take a massive effort to bring fertility back to replacement level and to get more of their members back to work. It is by no means certain that demographic change can be engineered. Industrial nations have had notoriously little success in influencing personal decisions about childbearing, even where there is some consensus as to desirable family size. Moreover, under the Schengen agreement, Italy is part of a Europe with free movement of people, and the net flow of people within Europe is unpredictable. It has yet to be established whether the movement toward Europe can be controlled in the face of intense migratory pressures that are generated by the wage gap between industrial nations and most of the third world. In Japan, perhaps yes, in Europe, maybe not. Finally, there is no more evidence of a consensus about population policy in Europe than in the United States.

    The present European experience shows the gains to be achieved by reducing population numbers, even as it illustrates the difficulties encountered when the shift is sudden. It is noteworthy that the problems of transition are much less severe in those European countries such as France and the United Kingdom that have come more gradually to population reduction. As a rule of thumb, a temporary decline to about 1.5 children achieves a population turnaround with minimal dislocation. Below that level, the problems increase.

    We do not know what will happen to European fertility. Are the present extremely low fertility levels the product of women's sudden discovery of the freedom of "controlling their own bodies" (in the feminist phrase)? Will fertility rise as they get used to that freedom, and maternal instincts reassert themselves? Or are the current patterns more permanent? If so, how can women's choices be influenced?

    But with all those uncertainties, Italy and the rest of Europe can celebrate the discovery that they are on the way to an environmentally sustainable future, unlike the rest of us. Europe is doing better than the rest of us in controlling its impact on global warming, to take one major current issue. A smaller Europe will be able to do even better.
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