Monday, February 10, 2014

It's all about the demographics

People really dislike when you bring up demographics in the pro-life argument. They claim that pro-life advocates are trying to control women and make them bear children. And I can understand their dislike of that agenda, although I really don't think most pro-life people even think much about that.

However, demographics do factor into the economic state of our countries. And this article really shows how simple it is. Makes me wonder why our leaders don't talk about this more. But then, it is treading on the sacred ground of "reproductive rights" and, heaven forbid, that we should realise that the natural cycle of birth and regeneration is important even for human beings.

Good economies depend upon having consumers. And the peak consumption years of consumers is when they are raising their families. Before and after that, they are not big spenders. People without children simply don't fuel the economy enough to keep it vibrant. It depends upon people needing houses, cars, education, dental work, all the things that people are focused on when bringing up their kids.

Following the Baby Boom, which peaked in 1961, came the Baby Bust, a long slow decline in the birthrate. Those babies grew up and began spending in accordance with highly predictable patterns.
  Ultimately the size of the US economy is simply the total of what we’re all spending. Overall household spending hits a high when we’re about 46. So the peak of the Baby Boom (1961) plus 46 suggests that a high point in the US economy should be about 2007, with a long, slow decline to follow for years to come.
Dent, a business consultant, stock-market prognosticator and author who says now is the time to sell stocks, has plucked an old argument off the dusty shelves of 1980s political rhetoric (“We’re nothing like Japan! And that’s horrible!”) and given it a new coat of paint: We’re exactly like Japan! And that’s horrible!
 As the Japanese have hit their 60s and 70s, they became stingier. Artificial, forced spending like government stimulus is not going to spark real voluntary spending because that isn’t what old people do. They’ve already paid for their houses, cars and their children’s schooling. Merchants try to goose lackluster sales by cutting prices, which increases the incentive for people to save their money, expecting things will be cheaper in the future than they are today.
 Implicitly, Dent is saying: Don’t blame politicians, the decline of manufacturing, education or cheap foreign imports for the economic stagnation that has already begun and will continue for many years. Blame your parents and grandparents for losing interest in having children back in the Sixties.

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