China’s Baby Bust: Very Bad News for Them; Very Good News for America

China is an international economic powerhouse. Their government very much wants that to grow, hopefully one day surpassing the United States in productivity and innovation. That is their national goal.

But China’s government leaders just received some very bad news on top of already declining news. Their anemically slow population growth has gotten even worse of late. The official Chinese national census shows their annual population growth rate has been an abysmal 0.53% over the past 10 years, down from a rate of 0.57% between 2000 and 2010. Declining population growth is not how superpowers are made.

This, even after the communist government struck down its official one-child policy in 2016 with the drastic hopes of boosting their lagging national fertility. Their encouragement for families to have two children has largely been ignored by couples.

When the national drumbeat has long been that not having children is one’s patriotic duty, as the Chinese government has been preaching for decades, the thinking that children are a detriment to global greatness rather than essential starts to sink in. The Chinese government is now realizing with great fear that they adopted exactly the wrong policy regarding children.

Ms Yue Su, principal economist from The Economist’s Intelligence Unit, said: “While [China’s] second-child policy had a positive impact on the birth rate, it proved short-term in nature” adding continued drops in the work force “will place a cap on China’s potential economic growth.” Not a slowdown. A cap! Yue Su concludes this is because “The demographic dividend that propelled the country’s economic rise over recent decades is set to dissipate quickly.”

A nation that fails to reproduce itself will fail to be an economic powerhouse because tomorrow’s inventors, business leaders, workers, health-care professionals, teachers, consumers and taxpayers always start out as babies today. Or they have to be imported from other countries with growing populations and China simply does not do immigration.

China is Following Japan’s Decline

The Chinese government well knows that flagging population growth essentially killed Japan’s once vital economic dominance. And they shudder at the fact.

Up until 2010, Japan was the world’s #2 economic powerhouse behind the United States. But they stopped having babies and Japan became the most aged society on earth. They also soon became the most indebted nation in the world, full of aging consumers and very few young producers. Each of these facts are closely related and China gets that.

As Canadian demographers Darrell Bricker and John Ibbitson explain in their powerful 2019 book Empty Planet: The Shock of Global Population Decline that when a nation’s population of 50-something women becomes much larger than its 20-something women, “that’s what makes population decline so implacable” and “once it sets in, it’s virtually impossible to stop because every year there are fewer and fewer women of child-bearing age than there were the year before.” Bricker and Ibbitson explain that such declining population “becomes the new normal, a normal that is almost impossible to change.” Population decline creates its own negative and damaging momentum.

In a major 2015 academic paper entitled “Causes and Remedies for Japan’s Long-Lasting Recession: Lessons for the People’s Republic of China”, two Asian economists observed, “The aging population and the diminishing working population is one of the biggest causes of the long-term recession of Japan.” And this is precisely what is happening with China as well. Bricker and Ibbitson hold bluntly that “China is becoming Japan” adding that the “only difference is that Japan became rich before it became old.” They lament that “China will not be so lucky” because their population decline is taking place earlier in their economic development.

This new census data from China makes that fear all the more real. And add to this that China has no flow of new citizens through immigration. Their approach has been to home-grow all of their workers, inventors, business founders, educators, consumers, military, and taxpayers. Except that they are clearly not and this new data makes that very clear. This is a very bad thing for the Chinese and their future economic and military prospects.

China will certainly not be overtaking the U.S. as a global powerhouse simply because our vibrant immigration and higher birth rate makes our future much brighter. Ours is slow, but it is more vibrant than China’s. Babies are the future, literally. And countries that are not having the former will certainly not have the latter. Just ask Japan.

Americans, and citizens of all other countries, must realize that one of the most patriotic duties is to at least have enough babies to replace themselves and grow the population just a smidge. Let us not be China who is now becoming Japan.

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