Added 22Sep: I’ve changed my mind; this post is wrong. Some hope that the world’s fertility fall might be reversed by governments subsidizing fertility. But on reflection, that seems unlikely to me. Let me explain why.
It's funny how over the last 40 years our society has transitioned so many women into the workforce, and to what end? All that extra income has led to skyrocketing costs for housing, college, and other big-ticket items because families have more willingness (and ability) to pay. We're all just out-bidding each other. Now that the dust has settled, everyone is still living in the same houses and attending the same colleges, only now it needs two incomes instead of one, and kids have become an extravagance. Faustian bargain if you ask me.
So everybody's more productive (two jobs per household; over the past 40 years real GDP per capita has more than doubled). But the average person's lifestyle is about the same. Who's all that real added value going to? It's not just going into inflation; real GDP already accounts for inflation. It's going into wealth inequality. Typical people struggle while the richest are getting richer than ever. That's the real culprit.
Also, the reason GDP per capita has doubled since 1983 is *not* because of more people entering the workforce. If you look at real GDP *per civilian worker* since 1983, that has also just about doubled. See https://fred.stlouisfed.org/series/GDPC1 (real GDP) https://fred.stlouisfed.org/series/A939RX0Q048SBEA (real GDP per capita) and https://fred.stlouisfed.org/series/CLF16OV (civilian workforce size). GDP per capita has doubled since 1983 because the productivity of each individual worker has doubled (largely from automation).
It's a poignant vision of the future is it not. Vast mansions filled with the latest conveniences but never again the sound of children. Reminds me of "There Will Come Soft Rains". https://www.youtube.com/watch?v=k8Fp-CquGIQ
Those are statistics for *average* floor space, not median, which means giant mansions have a disproportionate effect on the figure. It doesn't measure the floor space available to a median family. And it's new single-family homes only, ignoring housing complexes and renters.
Based on https://www.statista.com/statistics/183995/us-college-enrollment-and-projections-in-public-and-private-institutions/ total college enrollment in 1983 was 12.46 million, and enrollment in 2023 was 18.94 million. However, if you divide "number of college students" / "number of civilian sector workers" (from the st louis fed chart), you find that in 1983 there were 11.25 college students per 100 civilian sector workers, and in 2023 there were 11.33 college students per 100 civilian sector workers - practically no difference.
Well, I'm honored that my point last time got your attention.
I think you misunderstood. I was not arguing that people had children only because they were income- producing units. (yay David Friedman for influencing me to read some books on economics, though I still don't know anything.)
But, they did have reasons besides marital joy to want children. Children represented a line of succession, which economically meant the family would retain their assets in the long term.
It is unarguable that the vast majority children in the past entered the workforce earlier than they do today. Nobility aside, there were no six year old children who spent the day in day care. Everyone was expected to be useful.
Supporting a child for 10 years is very different than the current 25. And it may have been equally challenging.
Millenials say they want kids but are delaying having them because they cannot afford them. So we find out what it is that they think costs so much and then either convince them that they don't really need it, or subsidise it. The report says that childcare is too expensive, student debt is crushing, and housing costs too much. Government could address all of them.
We spent $3,000 per kid in 1950 on an inflation adjusted basis. So its up about 500%+.
So let's say we gave people a voucher for $8,000 or so (could vary a little by state COLA). That would save $8,000k per kid.
2) The defense budget is $842 billion. Let's say we can cut $518 billion. That's $7,000 per kid.
We have nukes. We shouldn't be worried about fighting another world war.
If we are going to have a Cold War with China the ultimate determinate of who wins will be that we have more kids and they don't. Replacement Fertility is a matter of national defense.
3) Obviously I would cut old age entitlements, especially for those that didn't create the children necessary to pay for them. Medicare and SS are $2.2T. If we cut them 17% that is another $5k.
So 1-3 just got you $20k for each kid under 18. Or $360,000 over their entire childhood. That seems like it would make a difference.
Maybe all that is politically impossible, but it's not mathematically impossible. I would just pass a bill giving parents the money with no way to pay for it and then once its that status quo it will be hard to take away. Either other stuff will get cut or we will go bankrupt and reset, but at least in the meantime parents would have gotten more money and we would have more kids to pick up the mess.
Address housing by making it easier to build, forgive student debt once, and at the same time severely cut subsidies for future study - that just leaves childcare needing real money. Abandoning the pretence that daycare is education and reducing the qualifications required might save some money there.
You could institute a wealth tax. You could just raise income tax taxes, or corporate taxes, or charge VAT. You could close down all sorts of tax exemptions. You could do away with 'charitable deductions', for instance. You could decide to tax capital gains more heavily ... I am sure there are dozens of ideas which will come easier to people who live in the USA unlike me. The point just being, if you decided that lack of children was a serious problem you wanted to address you could find the money, in the same way money got found, recently, for Ukrania or for vaccines.
In Italy for example more than 20% of young people between 15 and 29 are NEET. In Europe 10% overall. Nobody explains why low fertility is such an issue when we have 10 to 20% of young people being a burden to the economy just like retirees, as they don't survive thanks to their own activities but with some kind of subsidies (from governments of from the family).
Is it gatecrashing this conversation to note that human fertility is currently doing fine (or alarmingly not at all fine for those old people who have seen the world's population triple in just the course of one boomer lifetime)? What seems to be the case globally is that more advanced societies will lose out fertility-wise to those of what used to be called ''the third world '. Without getting too deep into Charles Murray/Steve Sailer territory, it should not, surely, be outside of the Overton window to note that anywhere that might reasonably be called an advanced modern civilisation has been created by either S.E. Asian or Indo-European majority ethnicities?
Maybe so but it is also the case that both this and the previous one seem to be largely predicated on two implicit assumptions that I do not entirely share:
1) the discussion of 'nations' seems to be unduly limited to places like America and Canada
2) declining fertility is axiomatically a bad thing
If you take in account simulations and forecasts like the ones in Limits to Growth or what W.E. Rees writes https://www.mdpi.com/2673-4060/4/3/32 , low fertility sounds like "voluntary" depopulation, something much better than "involuntary" through famine, epidemics, heat strokes, etc.
If you were fertility czar, what would you recommend? Increase research funding for artificial wombs and advancing in vitro? Tax breaks for adoption and successful child developmental achievements? A return to religious communes/group family dynamics? Raising status through social/cultural/financial incentives of Mormon/Catholic Mommy Bloggers etc. Send Jordan Peterson/Elon Musk out on speaking tours? Subsidizing Pro-Natal/Large Family Movies, Books, Music & Games?
I like this question. In people I know, a major thing is just what a massive pain in the ass it is to do all the normative parenting things with negligible amounts of the community support that used to be basically automatic -- neighborhoods with communal child-rearing responsibilities, large-ish multi-generational families to take up some of the burden, the absence of obligation to produce übermensch elite, affordable housing, etc.
Solving these in a standard market way seems prone to the same issues that solving foundational problems in health does. So I dunno what I'd do as a fertility czar, who mostly lacks the power needed to affect these things. But making life less awful for parents living in our current atomized reality seems like the vector to pursue somehow or other.
Hard to say what norms would arise if artificial wombs were a thing, but I suspect that they would generally be viewed more harshly than surrogacy, and be significantly more regulated. Also I don't think infertility is the main cause of fertility decline, although it could have some effect.
I think that's the stated reason, because it makes for a better argument (at least to non libertarians and such), but the actual reason is just that it's icky, and of course growing babies in pods seems much more icky. Moreover I think that if you can get people to see a very vivid picture of what a future where reproduction is almost entirely decoupled from humans is like then they will very strongly oppose such a change.
Overlooked the most important consideration: What values do we instill in the next generation? At one time we knew that America is the best country in the world, at any time in history. No dispute.
Today, emotionally stunted progressives hate America. No ideologues or their deluded followers love this country. They won't stop tearing it down, much less invest in the future.
The future belongs to those who show up. As with the Akkadians. Newcomers came to Mesopotamia, inherited the Sumerian script and lands. In a few generations lost all trace of the people who came before.
It's politically incorrect, but here goes: I would add to your list the genetic qualities of the parents. Governments should be more willing to invest in parents who are educated and high-earning, given that this correlates strongly with the child's future economic output. The US and Canada do this today with immigration policy that biases in favor of highly-skilled young people (grad students, H1B visa holders, people with assets, etc.).
Also for the list: How much political capital needs to be spent. By that I mean, to what extent is it perceived within the population as a real problem. Frankly a lot of Americans I talk to think a little bit of population loss could be a good thing. They remember back to their youth, when houses were cheaper and traffic was better and college admissions weren't insane and it wasn't a logistical nightmare to claim a camping spot at their favorite national park. In a very crowded country like Japan or South Korea I wonder if there is a similar ambivalence, in which case the political capital costs could be high to get to the scale of investment needed.
Are you sure that we really need people with "genetic quality" (I suppose you mean intelligence), or with high education?
All developed countries we have lot of intellectual youth unemployment. On the other hand, everybody is complaining about labour shortages. The reality is that there is a shortage of cheap labour, not labour itself. And everybody need cheap masons, mechanics, nurses, waiters, etc.
The "genetic quality" or the good education of the future generations are not solving the problem but making it worser because you will have even more people with expectations that are too high for the economy.
What is the government's interest in investing to create more cheap labor? It receives little tax income from that labor, i.e. it is a low return on investment. The government is likelier to invest in people that will pay a lot of tax in the future.
The fact that you invest in skills that could bring more taxes in the future doesn't mean they will actually bring more taxes.
This people must find a well paid job, and this isn't granted at all. It depends on the demand for those skills.
Meanwhile, there are billions of unskilled cheap labourers ready to migrate from poor countries to rich ones and feed lot of businesses that don't really need particular skills.
Take for example the tomato plantations in southern Italy: the industry could invest in drones to harvest tomatoes and the government could educate skilled drone engineers and technicians to feed this industry.
However, as the African continent provides for hundreds of millions of unskilled desperate and extreme cheap labourers ready to risk their lives to cross the Mediterranean, the government and the employers will keep importing slaves for the plantations (the current right-populist government decided recently to import even more African workers than the previous governments) .
They can collect taxes on many underpaid slaves as well.
"Some think that in the old days folks had kids as a way to pay for their retirement. But it seems that parents have almost always given much more to their kids overall than they’ve gotten back."
I don't think these are at all contradictory, especially in a world where the economy was smaller, more local, less comprehensive, and less automated. A farmer centuries ago couldn't easily sell or rent out the family farm to a stranger and then reliably live on the proceeds, or invest the proceeds and live on returns on capital. A lot of the goods, services, or care they'd need just wouldn't have been easy to buy. But, they could *definitely* give it to their kids and live in their spare room and get fed, maybe in exchange for babysitting grandkids. Who cares what the lifetime totals add up to in that situation?
In the modern day, yes, an individual with no kids can save and invest their money and then buy e.g. long-term care insurance. But what's the equivalent for a country? If a whole country allows that to happen, then who are the *actual people* providing the long-term care? Yes, in time, we can automate more of that. Yes, at present richer countries can allow more immigration. But at minimum, the people need to exist and be nearby before you can pay them to do physical care things for you.
In a declining population world, returns on capital might be much lower as the scarce resource becomes labor rather than capital. So perhaps it will actually be the case that children are the most efficient way to save for retirement.
I guess I'm saying maybe the market just solves this problem for you, and government subsidies aren't needed.
All the points you make are valid points, but I think you overlook the forces that actually would want to increase fertility. In the United States I wouldn’t be surprised if the pentagon one day will advocate pro natalist policies. Because their won’t be always such an inflow of immigrants same holds true for China who might see India as a more populated rival. Same could be said for japan and Korea. Some countries really don’t want to rely on immigrants too. And the historical reasons for high fertility cited in history papers or Econ papers seems to me not that much convincing. Fertility reduction is handy now compared to the past with affordable an effective contraception. Another part of my argument is that I don’t imagine it to be too hard to raise fertility with government intervention. The US can certainly afford to pay 100 000 USD per child. That would only cost 400 billion USD to 600 billion USD annually. The US also would kind of have good reasons to do so. I however imagine that you could be less in favor of that because you lean more libertarian, hence you wouldn’t like that kind of amount of income transfer
I've seen lot of "cost to raise a child" posts, but $20k/year should do it easy. I won't claim that makes them cost neutral (parents do a lot of unpaid labor) but it would be close enough.
We could afford it. There are about 3 working age for each child so that's only like $6k in taxes per worker.
We won't do it because kids can't vote nor can parents vote on their behalf.
I think you can basically give 100,000 USD per new child. It’s not too much considering he or she is going to pay 500,000 USD in taxes in the future not counting inflation adjusted
But ... they do. Fund fertility. I get 750€ a month, 250 for each kid. Plus 1500/mth parents-money for the first year - if I stop working. Plus nearly free Kindergarten and free okayish schools and famously free college (this being Germany). And free family health insurance (I pay, but as a single I paid the same as now, with wife and kids taken care of without extra-charge. When my youngest will have finished school,00000, the funding will have been 54k€ Kindergeld+100k in schools-fees+maybe 10k Kindergarten-subsidies, no idea how to calculate health-care, but easily another 10k. Not that this would raise our fertility rate to more than 1.58 (2022). In Berlin, 37% of the mothers had no German passport; nationwide 25% (obviously many ethnic Turkish or Russian have a German passport; in the class of my son - primary school - only one other boy has a 'German' surname.). Oh, I am fine with that - else we'd see TFRs as in Japan or South Korea. https://www.destatis.de/EN/Themes/Society-Environment/Population/Births/Tables/live-birth-citizenship.html Oh, the slave-comparison signals "fringe" - as do most of the first comments. I hope, not mine.
Obviously, that funding is not enough to get above 2.1 (it nearly does in France), but "national fertility funding" it is and not exactly tiny - possibly raising the rate from otherwise below 1.0. As I commented before, having a baby in German may easily cost a well qualified woman half a million in lost life-earnings. For others, the opportunity costs are much lower.
If the interests of the government are closely tied into the economy then politicians over time will have to care collectively about depopulation as the workforce/consumption shrink.
The effects of individual depopulation aren’t so dramatic now but as the economy shrinks from a lack of producers/consumers quality of life will drop over time. My point is that the government seemingly has the most to lose from depopulation. Maybe using government issued bonds to fund births and child rearing could be one extreme scenario.
I’m from one of those countries (Albania) and they’ll insist that living standards are improving because they’ll do or say pretty much anything to join the EU but on the ground quality of life is stagnating and so is the economy. If you ask older people like my dad they’ll insist that quality of life/healthcare was better during the communist era. There’s definitely selection bias and golden age thinking that shape their opinion but also just pessimism regarding the future of the country. When it comes to the future of an entire nation perception matters.
It seems that the big depopulation of eastern European countries happened in the nineties after the collapse of communism.
Population then rebounded a bit with the economic growth of the early 2000s , but now it is plummeting again because of the transition to a more modern society with higher expectations.
There are many dimensions to this but mainly corruption and low wages causes many people to either move out of rural areas or leave the country entirely. Often the best workers end up leaving which also hinders the economy leading to a decrease in overall quality of life. It's possible that this effect will be too slow to notice on a global scale or on the scale of a large country like the U.S. but I tend to be optimistic, I think there are market/government solutions to improve fertility.
It's funny how over the last 40 years our society has transitioned so many women into the workforce, and to what end? All that extra income has led to skyrocketing costs for housing, college, and other big-ticket items because families have more willingness (and ability) to pay. We're all just out-bidding each other. Now that the dust has settled, everyone is still living in the same houses and attending the same colleges, only now it needs two incomes instead of one, and kids have become an extravagance. Faustian bargain if you ask me.
So everybody's more productive (two jobs per household; over the past 40 years real GDP per capita has more than doubled). But the average person's lifestyle is about the same. Who's all that real added value going to? It's not just going into inflation; real GDP already accounts for inflation. It's going into wealth inequality. Typical people struggle while the richest are getting richer than ever. That's the real culprit.
Also, the reason GDP per capita has doubled since 1983 is *not* because of more people entering the workforce. If you look at real GDP *per civilian worker* since 1983, that has also just about doubled. See https://fred.stlouisfed.org/series/GDPC1 (real GDP) https://fred.stlouisfed.org/series/A939RX0Q048SBEA (real GDP per capita) and https://fred.stlouisfed.org/series/CLF16OV (civilian workforce size). GDP per capita has doubled since 1983 because the productivity of each individual worker has doubled (largely from automation).
It's a poignant vision of the future is it not. Vast mansions filled with the latest conveniences but never again the sound of children. Reminds me of "There Will Come Soft Rains". https://www.youtube.com/watch?v=k8Fp-CquGIQ
Those are statistics for *average* floor space, not median, which means giant mansions have a disproportionate effect on the figure. It doesn't measure the floor space available to a median family. And it's new single-family homes only, ignoring housing complexes and renters.
Based on https://www.statista.com/statistics/183995/us-college-enrollment-and-projections-in-public-and-private-institutions/ total college enrollment in 1983 was 12.46 million, and enrollment in 2023 was 18.94 million. However, if you divide "number of college students" / "number of civilian sector workers" (from the st louis fed chart), you find that in 1983 there were 11.25 college students per 100 civilian sector workers, and in 2023 there were 11.33 college students per 100 civilian sector workers - practically no difference.
> Will Nations Fund Fertility?
lol no
the goal is to replace the native populations, not grow them
Well, I'm honored that my point last time got your attention.
I think you misunderstood. I was not arguing that people had children only because they were income- producing units. (yay David Friedman for influencing me to read some books on economics, though I still don't know anything.)
But, they did have reasons besides marital joy to want children. Children represented a line of succession, which economically meant the family would retain their assets in the long term.
It is unarguable that the vast majority children in the past entered the workforce earlier than they do today. Nobility aside, there were no six year old children who spent the day in day care. Everyone was expected to be useful.
Supporting a child for 10 years is very different than the current 25. And it may have been equally challenging.
If you believe the report from the CDC referenced here: https://www.businessinsider.com/us-birthrate-decline-millennials-delay-having-kids-2019-5?op=1&r=US&IR=T
Millenials say they want kids but are delaying having them because they cannot afford them. So we find out what it is that they think costs so much and then either convince them that they don't really need it, or subsidise it. The report says that childcare is too expensive, student debt is crushing, and housing costs too much. Government could address all of them.
Where exactly do you think such money would come from?
1) We already spend 16k per kid per year on K-12 education. Redirecting that to school choice/homeschool could be done at no cost.
https://nces.ed.gov/programs/digest/d19/tables/dt19_236.55.asp?current=yes
We spent $3,000 per kid in 1950 on an inflation adjusted basis. So its up about 500%+.
So let's say we gave people a voucher for $8,000 or so (could vary a little by state COLA). That would save $8,000k per kid.
2) The defense budget is $842 billion. Let's say we can cut $518 billion. That's $7,000 per kid.
We have nukes. We shouldn't be worried about fighting another world war.
If we are going to have a Cold War with China the ultimate determinate of who wins will be that we have more kids and they don't. Replacement Fertility is a matter of national defense.
3) Obviously I would cut old age entitlements, especially for those that didn't create the children necessary to pay for them. Medicare and SS are $2.2T. If we cut them 17% that is another $5k.
So 1-3 just got you $20k for each kid under 18. Or $360,000 over their entire childhood. That seems like it would make a difference.
Maybe all that is politically impossible, but it's not mathematically impossible. I would just pass a bill giving parents the money with no way to pay for it and then once its that status quo it will be hard to take away. Either other stuff will get cut or we will go bankrupt and reset, but at least in the meantime parents would have gotten more money and we would have more kids to pick up the mess.
Address housing by making it easier to build, forgive student debt once, and at the same time severely cut subsidies for future study - that just leaves childcare needing real money. Abandoning the pretence that daycare is education and reducing the qualifications required might save some money there.
taxes.
Taxing who?
You could institute a wealth tax. You could just raise income tax taxes, or corporate taxes, or charge VAT. You could close down all sorts of tax exemptions. You could do away with 'charitable deductions', for instance. You could decide to tax capital gains more heavily ... I am sure there are dozens of ideas which will come easier to people who live in the USA unlike me. The point just being, if you decided that lack of children was a serious problem you wanted to address you could find the money, in the same way money got found, recently, for Ukrania or for vaccines.
It is happening everywhere in the developed world, especially in east Asia:
https://www.businessinsider.com/japan-millennial-salaryman-job-wages-rent-home-ownership-birthrate-2023-5
https://www.businessinsider.com/south-korean-millennial-income-housing-ambitions-jobs-2023-3
https://www.insider.com/disenchanted-chinese-youth-join-a-mass-movement-to-lie-flat-2021-6
https://www.businessinsider.com/what-are-full-time-children-china-2023-7
In Italy for example more than 20% of young people between 15 and 29 are NEET. In Europe 10% overall. Nobody explains why low fertility is such an issue when we have 10 to 20% of young people being a burden to the economy just like retirees, as they don't survive thanks to their own activities but with some kind of subsidies (from governments of from the family).
Is it gatecrashing this conversation to note that human fertility is currently doing fine (or alarmingly not at all fine for those old people who have seen the world's population triple in just the course of one boomer lifetime)? What seems to be the case globally is that more advanced societies will lose out fertility-wise to those of what used to be called ''the third world '. Without getting too deep into Charles Murray/Steve Sailer territory, it should not, surely, be outside of the Overton window to note that anywhere that might reasonably be called an advanced modern civilisation has been created by either S.E. Asian or Indo-European majority ethnicities?
You said this exact same thing on my last post related to fertility. I think you've made your point.
Maybe so but it is also the case that both this and the previous one seem to be largely predicated on two implicit assumptions that I do not entirely share:
1) the discussion of 'nations' seems to be unduly limited to places like America and Canada
2) declining fertility is axiomatically a bad thing
I am likely to write many posts based on views you do not share. You need not mention it every time.
Let's not quarrel...but I do think that having chosen to respond to my original comment, you might usefully have also responded to my reply to it.
Don't forget, that both America and Canada are substantially increasing in population and will continue to do so through 2050 and beyond.
If you take in account simulations and forecasts like the ones in Limits to Growth or what W.E. Rees writes https://www.mdpi.com/2673-4060/4/3/32 , low fertility sounds like "voluntary" depopulation, something much better than "involuntary" through famine, epidemics, heat strokes, etc.
If you were fertility czar, what would you recommend? Increase research funding for artificial wombs and advancing in vitro? Tax breaks for adoption and successful child developmental achievements? A return to religious communes/group family dynamics? Raising status through social/cultural/financial incentives of Mormon/Catholic Mommy Bloggers etc. Send Jordan Peterson/Elon Musk out on speaking tours? Subsidizing Pro-Natal/Large Family Movies, Books, Music & Games?
He has already given his suggestion:
https://www.overcomingbias.com/p/win-win-babies-as-infrastructurehtml
I like this question. In people I know, a major thing is just what a massive pain in the ass it is to do all the normative parenting things with negligible amounts of the community support that used to be basically automatic -- neighborhoods with communal child-rearing responsibilities, large-ish multi-generational families to take up some of the burden, the absence of obligation to produce übermensch elite, affordable housing, etc.
Solving these in a standard market way seems prone to the same issues that solving foundational problems in health does. So I dunno what I'd do as a fertility czar, who mostly lacks the power needed to affect these things. But making life less awful for parents living in our current atomized reality seems like the vector to pursue somehow or other.
How about just letting the US population increase to 400 million by 2060 like it's projected to do anyway.
Hard to say what norms would arise if artificial wombs were a thing, but I suspect that they would generally be viewed more harshly than surrogacy, and be significantly more regulated. Also I don't think infertility is the main cause of fertility decline, although it could have some effect.
I think that's the stated reason, because it makes for a better argument (at least to non libertarians and such), but the actual reason is just that it's icky, and of course growing babies in pods seems much more icky. Moreover I think that if you can get people to see a very vivid picture of what a future where reproduction is almost entirely decoupled from humans is like then they will very strongly oppose such a change.
Overlooked the most important consideration: What values do we instill in the next generation? At one time we knew that America is the best country in the world, at any time in history. No dispute.
Today, emotionally stunted progressives hate America. No ideologues or their deluded followers love this country. They won't stop tearing it down, much less invest in the future.
The future belongs to those who show up. As with the Akkadians. Newcomers came to Mesopotamia, inherited the Sumerian script and lands. In a few generations lost all trace of the people who came before.
It's politically incorrect, but here goes: I would add to your list the genetic qualities of the parents. Governments should be more willing to invest in parents who are educated and high-earning, given that this correlates strongly with the child's future economic output. The US and Canada do this today with immigration policy that biases in favor of highly-skilled young people (grad students, H1B visa holders, people with assets, etc.).
Also for the list: How much political capital needs to be spent. By that I mean, to what extent is it perceived within the population as a real problem. Frankly a lot of Americans I talk to think a little bit of population loss could be a good thing. They remember back to their youth, when houses were cheaper and traffic was better and college admissions weren't insane and it wasn't a logistical nightmare to claim a camping spot at their favorite national park. In a very crowded country like Japan or South Korea I wonder if there is a similar ambivalence, in which case the political capital costs could be high to get to the scale of investment needed.
Are you sure that we really need people with "genetic quality" (I suppose you mean intelligence), or with high education?
All developed countries we have lot of intellectual youth unemployment. On the other hand, everybody is complaining about labour shortages. The reality is that there is a shortage of cheap labour, not labour itself. And everybody need cheap masons, mechanics, nurses, waiters, etc.
The "genetic quality" or the good education of the future generations are not solving the problem but making it worser because you will have even more people with expectations that are too high for the economy.
What is the government's interest in investing to create more cheap labor? It receives little tax income from that labor, i.e. it is a low return on investment. The government is likelier to invest in people that will pay a lot of tax in the future.
The fact that you invest in skills that could bring more taxes in the future doesn't mean they will actually bring more taxes.
This people must find a well paid job, and this isn't granted at all. It depends on the demand for those skills.
Meanwhile, there are billions of unskilled cheap labourers ready to migrate from poor countries to rich ones and feed lot of businesses that don't really need particular skills.
Take for example the tomato plantations in southern Italy: the industry could invest in drones to harvest tomatoes and the government could educate skilled drone engineers and technicians to feed this industry.
However, as the African continent provides for hundreds of millions of unskilled desperate and extreme cheap labourers ready to risk their lives to cross the Mediterranean, the government and the employers will keep importing slaves for the plantations (the current right-populist government decided recently to import even more African workers than the previous governments) .
They can collect taxes on many underpaid slaves as well.
"Some think that in the old days folks had kids as a way to pay for their retirement. But it seems that parents have almost always given much more to their kids overall than they’ve gotten back."
I don't think these are at all contradictory, especially in a world where the economy was smaller, more local, less comprehensive, and less automated. A farmer centuries ago couldn't easily sell or rent out the family farm to a stranger and then reliably live on the proceeds, or invest the proceeds and live on returns on capital. A lot of the goods, services, or care they'd need just wouldn't have been easy to buy. But, they could *definitely* give it to their kids and live in their spare room and get fed, maybe in exchange for babysitting grandkids. Who cares what the lifetime totals add up to in that situation?
In the modern day, yes, an individual with no kids can save and invest their money and then buy e.g. long-term care insurance. But what's the equivalent for a country? If a whole country allows that to happen, then who are the *actual people* providing the long-term care? Yes, in time, we can automate more of that. Yes, at present richer countries can allow more immigration. But at minimum, the people need to exist and be nearby before you can pay them to do physical care things for you.
In a declining population world, returns on capital might be much lower as the scarce resource becomes labor rather than capital. So perhaps it will actually be the case that children are the most efficient way to save for retirement.
I guess I'm saying maybe the market just solves this problem for you, and government subsidies aren't needed.
Where I agree is that it is however an serious issue over all
All the points you make are valid points, but I think you overlook the forces that actually would want to increase fertility. In the United States I wouldn’t be surprised if the pentagon one day will advocate pro natalist policies. Because their won’t be always such an inflow of immigrants same holds true for China who might see India as a more populated rival. Same could be said for japan and Korea. Some countries really don’t want to rely on immigrants too. And the historical reasons for high fertility cited in history papers or Econ papers seems to me not that much convincing. Fertility reduction is handy now compared to the past with affordable an effective contraception. Another part of my argument is that I don’t imagine it to be too hard to raise fertility with government intervention. The US can certainly afford to pay 100 000 USD per child. That would only cost 400 billion USD to 600 billion USD annually. The US also would kind of have good reasons to do so. I however imagine that you could be less in favor of that because you lean more libertarian, hence you wouldn’t like that kind of amount of income transfer
I've seen lot of "cost to raise a child" posts, but $20k/year should do it easy. I won't claim that makes them cost neutral (parents do a lot of unpaid labor) but it would be close enough.
We could afford it. There are about 3 working age for each child so that's only like $6k in taxes per worker.
We won't do it because kids can't vote nor can parents vote on their behalf.
I think you can basically give 100,000 USD per new child. It’s not too much considering he or she is going to pay 500,000 USD in taxes in the future not counting inflation adjusted
But ... they do. Fund fertility. I get 750€ a month, 250 for each kid. Plus 1500/mth parents-money for the first year - if I stop working. Plus nearly free Kindergarten and free okayish schools and famously free college (this being Germany). And free family health insurance (I pay, but as a single I paid the same as now, with wife and kids taken care of without extra-charge. When my youngest will have finished school,00000, the funding will have been 54k€ Kindergeld+100k in schools-fees+maybe 10k Kindergarten-subsidies, no idea how to calculate health-care, but easily another 10k. Not that this would raise our fertility rate to more than 1.58 (2022). In Berlin, 37% of the mothers had no German passport; nationwide 25% (obviously many ethnic Turkish or Russian have a German passport; in the class of my son - primary school - only one other boy has a 'German' surname.). Oh, I am fine with that - else we'd see TFRs as in Japan or South Korea. https://www.destatis.de/EN/Themes/Society-Environment/Population/Births/Tables/live-birth-citizenship.html Oh, the slave-comparison signals "fringe" - as do most of the first comments. I hope, not mine.
Those aren't enough to get fertility above replacement.
Obviously, that funding is not enough to get above 2.1 (it nearly does in France), but "national fertility funding" it is and not exactly tiny - possibly raising the rate from otherwise below 1.0. As I commented before, having a baby in German may easily cost a well qualified woman half a million in lost life-earnings. For others, the opportunity costs are much lower.
https://www.economist.com/europe/2019/06/29/why-germanys-birth-rate-is-rising-and-italys-isnt
If the interests of the government are closely tied into the economy then politicians over time will have to care collectively about depopulation as the workforce/consumption shrink.
If we don't care about our individual depopulation, why will we care about it collectively?
The effects of individual depopulation aren’t so dramatic now but as the economy shrinks from a lack of producers/consumers quality of life will drop over time. My point is that the government seemingly has the most to lose from depopulation. Maybe using government issued bonds to fund births and child rearing could be one extreme scenario.
I’m from one of those countries (Albania) and they’ll insist that living standards are improving because they’ll do or say pretty much anything to join the EU but on the ground quality of life is stagnating and so is the economy. If you ask older people like my dad they’ll insist that quality of life/healthcare was better during the communist era. There’s definitely selection bias and golden age thinking that shape their opinion but also just pessimism regarding the future of the country. When it comes to the future of an entire nation perception matters.
It seems that the big depopulation of eastern European countries happened in the nineties after the collapse of communism.
Population then rebounded a bit with the economic growth of the early 2000s , but now it is plummeting again because of the transition to a more modern society with higher expectations.
There are many dimensions to this but mainly corruption and low wages causes many people to either move out of rural areas or leave the country entirely. Often the best workers end up leaving which also hinders the economy leading to a decrease in overall quality of life. It's possible that this effect will be too slow to notice on a global scale or on the scale of a large country like the U.S. but I tend to be optimistic, I think there are market/government solutions to improve fertility.