The last month has greatly change what I see as the default future. Instead of seeing the last few centuries of exponential world growth continuing until a new much faster growth mode appears within a century or two, my default is now darker. The economy declines after population peaks in roughly thirty years, and innovation then grinds to a halt, with the economy not rising again until world population is dominated by Amish-
I like the tax waiver idea! If attached to the mother it would have a secondary benefit, namely encouraging men to stay married to the mother of their children (lest they lose the tax benefit). Two-parent households are shown to have many positive benefits for children.
The US has a get out of jail free card here in the form of immigration. There are no lack of young people who want to move here, and we let in about 1m annually vs. 3.6m natural births. I suspect that politicians' first instinct will be to turn up that spigot because it's cheap and has other benefits, but it begs the question of how long other countries will let their people freely emigrate when the population crunch comes in earnest.
I see news articles suggesting Hungary planned to try something along Bryan’s idea in 2019. — women with four kids pay no income taxes for life.
A nit: what about the time value of money? If we expect a kid to generate X of taxes in their lifetime, that’s not worth X to the government now, cause they have to pay interest on their debt.
It is still beyond me why you consider lower fertility and a slowdown or even reversal of population increase to be a problem. I'm not a Paul Ehrich fan, and am not against population increase. I do not think population increase will be a disaster. I don't see, either, why population decrease will be a disaster. Your idea that it will be is, to me, as nuts as his view that it will be some kind of elixer.
As far as explanations go, demographers for many decades have observed that as a population becomes more affluent, their birth rate goes down. When I started grad school at Princeton (in chemistry, in 1972) I stopped in at the office of Ansley Coale, a well known demographer then on the faculty, who mentioned this immediately. He said, that the standard explanation is that poor folks have more kids because most of them will die, but some will survive to take care of their parents in their old age. In more affluent groups, people accumulate wealth that will see them through old age, and many countries have the equivalent of social security that helps.
I don't know if that "standard explanation" is still in vogue, but all I can say is that it makes sense to me. That's a low bar :-), but I frankly don't know whether there is an alternative explanation or whether it is now or was then significantly contested, or what evidence, pro and con, has been amassed on this question over the past 50 years.
I might add that the same contrast can be made comparing affluent and poor subpopulations. I think it was Dick Gregory who said something like "The rich have trust funds; the middle-class have bank accounts and the po' have children."
I think I've asked this before, so:
1. Why do you think lower fertility is bad?
2. Do you have any problem with the "standard explanation" I just described, and if so, what is it?
Forgive me if I missed something, but doesn't that up-front payment just become more debt that has to be paid?
I like the idea. It just seems like there will be a huge challenge convincing the general public that we should have pro-fertility policies. After all, there is an easy way for people to be pro-fertility in their personal lives - just have more kids. And the core problem is that not enough people are doing this.
We need some sort of "pro-fertility" faction in order to get any policies along these lines. It's like the early days of the YIMBY movement, we need to get some attention and we need to be open minded about who the political allies would be and what sort of policies would be possible.
I don't see why it's clear we want to. Sure, greater population means faster technological advancement and growth but it also means more people live in a less advanced and comfortable time.
For instance, suppose increasing the number of people alive during the middle ages would have speed up technological advancement and brought about the industrial revolution earlier. Whether or not that would have been desierable depends on whether you've on net increased the number/fraction of all people who will ever live's standard of living and that seems like a very nonobvious question.
Seems to me we need to know just how paralizeable human advancement is and how resource bound it is to figure out if this is a good idea.
A cheaper way to boost potential tax revenue from future generations is to pay for IVF+PGS to select for brighter babies, and even offer a large incentive for using genetic testing to select embryos. The benefits to the national economy from smarter babies would be much greater than the increased tax revenue per baby. Why? Most of the benefits of brighter people are not private. Most of the increases in GDP flow to the rest of the population.
If we could rapidly raise IQ then it could preserve or even increase the number of very bright people even as the general population shrank in size.
(1) "He suggested N=1, but dividing $300K by the average annual federal tax bill of $13.4K gives N>22" Your logic of dividing $300K by $13.4K to get 22 years of parental tax relief is based on the dubious idea that the child will *actually* contribute $300k to reducing the national debt so that's how much we should incentivize reproduction. The child will eventually be paying $13.4K taxes too when they're an adult (and ignoring inflation etc.) Only about 11% of the federal budget goes into paying interest on the national debt. Most of it goes into services whose costs scale with the population. So it would be more accurate to say the child, once adult, is "worth" only around $13.4k * 0.11 = $1500 a year with respect to paying down the national debt. Over a working lifetime that's perhaps $60k, not $300k. Actually the child's contribution is less than that, perhaps negative, because the national debt is increasing. Another worker plausibly would add more to the debt (because of federal services to support that worker) than the worker helps pay off.
(2) We should not expect that a 10% increase in the population would equate to a 10% increase in GDP. Much of GDP depends on factors that do not much change based on the population, such as natural resources, treaties and established trade relations with other countries, military presence, transportation infrastructure, international intellectual property of companies like Microsoft, Apple, or Disney. Countries with very high populations often have low GDP per capita. So, if you want to increase the population to increase our national ability to pay down the national debt, there would be diminishing returns, perhaps even negative returns.
(3) "Population peaks in roughly thirty years" - again, where are you getting this 30 years figure? The last time you said 30 years I pointed out the UN projection is that world population will peak in 2086 - over 60 years away. Now you've repeated the 30 years figure without any cited source.
(4) The US is already projected to increase in population to 400 million by 2060 as a combination of immigration and natural increase (births - deaths). If, for tax purposes/national debt purposes, we wanted increase beyond that, funding *immigration* could be a better bet than funding births, because an adult immigrant starts paying taxes immediately instead of in 20 years
(5) Where is the political will to make current sacrifices to pay down the national debt? That just isn't happening because US politics is too short-termist. If it was happening, it would happen through an increase in taxes and reduction in spending.
1) Poland has tried that for a few years now - the version with direct payments, they pay around 13% of median salary (~$2500, median salary is ~$18k) per child. In the US, paying 13% would mean $6700 for 18 years = $120k for each kid. This is quite close to your proposal. Now: the consensus is that it (mostly) doesn't work. Which was non-obvious from the start, but is pretty obvious after 7 years of running the program. I am very sceptical of whether the implementation details (making it a tax allowance instead of a direct payment, etc) would change this. Price elasticity of having children is just very low. You have listed a lot of good reasons in one of your last posts for why this is true.
2) Right now, Amish and similar groups have high fertility, but then the children mostly leave the community. Why do you think this is a bad model of what would ultimately happen? Amish have about 7 children on average, which means that (assuming average of 1.5 child per non-Amish woman) they can constitute about 10% of the population, and the US would still have population growth.
 (Wikipedia article about this: https://pl-m-wikipedia-org.translate.goog/wiki/Rodzina_500_plus?_x_tr_sl=pl&_x_tr_tl=en&_x_tr_hl=en&_x_tr_pto=wapp)
What changed your worldview?
However there is one thing that I am still a bit more optimistic about. Let’s assume population declines in a 1,6 fertility scenario. My assumption would be that the net technological output would decrease given we operate without advanced AI, but the output wouldn’t really be negative in the sense that we forget about existing technology. Not that population decline isn’t bad, but at what point it would actually lead to economic decline is quite hard to predict. I would argue that anything below 4 billion people is very bad in general.
Interesting. Haven't we already hit max population in developed countries a long time ago? How much does it help that poor African countries keep our growth positive as a world?
Robin, your new vision of the future looks very much like mine except that what I call the Millennium you refer to as a dark future “dominated by Amish-like insular religious high fertility communities.”
We both see a religious revival as inevitable, probably after some form of calamitous decline of our current society. But why must a religious renewal / revolution necessarily be so dark? The Abrahamic religious movement brought a moral big God into a world of child sacrificing small gods. The Christian revolution built on that foundation to bring us human rights and egalitarian philosophy. Civilizations rise and fall but revelation is what drives progress. Why should we not look forward with hope to a Millennial future that is both fertile and bright?
Yes, on behalf of fertile religious people everywhere, I humbly accept your offerings.
I take it that your seventh point is that your program can be financed by issuing new debt. But that would increase the debt that will (nominally) have to be repaid by the same amount as the (present value of the) tax receipts expected from the extra people. The payments to parents would then have to be considerably less than the amounts you are suggesting.
Your program with the larger payments might be financed by increasing taxes or cutting back other government programs, but that would run into the public's opposition to such measures, which, after all, is the cause of the U.S.'s large debt.
"Divide these by the current U.S. population to get a debt per citizen ranging from $300K to $730K. We should thus ..."
"These" are expected future obligations vs. the current population?
1. Shouldn't we be consistent and measure expected future obligations vs. expected future population?
2. Shouldn't we talk about risk? If we enact a policy of "incur massive current obligation" (by giving people a rebate) we are certainly adding to our debt. We have a good idea of the cost. It's huge. The future return is much more uncertain. And entirely dependent on future behavior of people who can be expected (like current people) to game the system.
Maybe I'm just misunderstanding everything, but this policy seems very unlikely to work.
Really, if you want to raise fertility rates, we should do the opposite. Low fertility seems highly correlated with high-debt, big welfare state policies. For pretty obvious reasons, all of which suggest the path toward increasing fertility lies in reducing debt.
1. Reduce regulatory limits on housing supply and subsidization of demand. People want a good place to live and raise kids, and overregulation of the housing market has made this difficult (and has made personal debt explode).
2. Reduce regulatory limits on educational supply and subsidization of demand. People want good educations for their kids, and the overregulation of education markets has made this difficult (and has made personal and public debt explode).
3. Reduce regulatory limits on health care supply and subsidization of demand. People want good health for their kids, and the overregulation of health markets has made this difficult (and has made mostly public debt explode).
4. Eliminate the limits on labor market supply that act to prevent people from working around the high-cost college system. To put it bluntly, the college system in the US is a high-cost caste system.
5. Reduce social-security payments. Traditionally one of the largest incentives to have kids was that they'd take care of you when you got old. Modern governments have largely replaced that with mandated intergenerational wealth transfers.
This isn't rocket science. People can't afford to have kids, so they don't. The operation of these factors in East Asian countries is a little different, but not in the big picture. We don't have kids because people rightly understand that their children will be ripped off by today's generation of grifters.
The solution is to stop the grift, not to make explicit that the future generations will be our wage slaves.