By Ron Knecht
May 25, 2021
“All over the world, countries are confronting population stagnation and a fertility bust, a dizzying reversal unmatched in recorded history that will make first-birthday parties a rarer sight than funerals, and empty homes a common eyesore.”
That was the lede in the top story in Sunday’s New York Times. It’s a recognition of a reality I first addressed a decade ago but which progressives, statists and Greens have denied.
They have lived on the dire alarmist prophesies of Paul Ehrlich from half-a-century ago. The prologue of his 1968 book, The Population Bomb, began:
“The battle to feed all of humanity is over. In the 1970’s the world will undergo famines – hundreds of millions of people are going to starve to death in spite of any crash programs embarked upon now. At this late date nothing can prevent a substantial increase in the world death rate, although many lives could be saved through dramatic programs to ‘stretch’ the carrying capacity of the earth by increasing food production. But these programs will only provide a stay of execution unless they are accompanied by determined and successful efforts at population control.”
Because such ideologues live on repeating simple narratives to support their collectivist political plans and not on actual science such as analyzing new data, they have insisted for 50 years that exponential population growth is inevitable and will lead to world-wide cataclysm.
Ten years ago, in my work on cost of capital (or typical returns on investments), I began to examine population growth rates and the demographic structures of economies. This was important to determining future expected returns because those returns depend on expected economic growth rates, which depend in part on population growth rates. I noted that birth rates, and thus population growth in the US, had been declining since the turn of the century.
Looking more widely at birth rates and population growth rates around the world, I learned that population implosion was already evident in Japan, Russia, Italy and Germany, among other countries. And birth rates were falling nearly everywhere. They have plummeted in China due to its evil one-child policy, which will cause that country significant economic and social problems in coming years.
Why the decline? Research indicates that birth rates are an inverse function of women’s education levels and family income levels. That is, as education and income levels rise, birth rates fall. In some parts of India and Africa, birth rates are even lower than would be indicated by education and income levels. However, Africa continues to have the highest birth rates. I discussed these matters in speaking presentations and mentioned them in my Controller’s Annual Reports.