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Is a shrinking population actually bad in the long term? I'm taking on the order of centuries here. While it does introduce the dilemma of reducing spending on

Is a shrinking population actually bad in the long term? I'm taking on the order of centuries here. While it does introduce the dilemma of reducing spending on the elderly or increasibg taxes to care for the latter aging population, a shrinking population seems like it'd reduce environmental impact and global resource consumption in the long run.

hn_throwaway_99 8y ago
While this may be true, it's not that much of an exaggeration to say that capitalism is a Ponzi scheme. At the very least our current economic system is dependent on continuous growth, including population growth, and when that ends there will be a world of hurt.
- manfredo 8y ago
  > and when that ends there will be a world of hurt. First world countries' with shrinking populations aren't falling apart. Sure places like Japan, Italy, and Spain have economic troubles associated with a growing retirement population, and shrinking workforce. But they're still pretty good places to live in. While global growth would decline, I'm dubious of the claim that per-capita wealth would go down. With the same pool of resources spread across fewer people, the opposite seems likely. The labor force would reduce in size, too, so manufactured goods and services may not see their prices go down. But things that are zero-sum like natural resources, real-estate, etc. should drop in cost as fewer people are competing for them.
  - Gibbon1 8y ago
    I take the argument that from an economists view point negative population growth is a very bad thing indeed. But from an individuals point of view actually not. Because the economist only cares about total 'GDP' and is absolutely uninterested in quality of life. Because quality of life can't be monetized. From an individuals point of view lower population means fix resources are spread less thinly. There is less competition for jobs so you can command a large share of the pie.
    - bodas 8y ago
      There may be less competition for jobs but when you're elderly there's more competition for people to take care of you.
      - toasterlovin 8y ago
        Old people have resources, though, so NBD. Reasonable societal arrangements should favor new families at the expense of old folks.
        Gibbon1 8y ago
        Old people often don't use that many resources either at least while they are in good health. Most of the costs are associated with the last year or two of life. SO that expense is already committed to when they born.
adventured 8y ago
The sole problem from population contraction, is replacement tax dollars for existing entitlement-type programs that are built on a ponzi scheme approach to ever larger inflows of tax revenue to support them over time. Most of the developed world has the same problem on that front. The desperation by these countries when it comes to figuring out how to patch up the finances of those programs will increase by the year. Robot (productivity) taxes will be one small answer. Another will be ever higher income taxes, also eventually including heavy wealth taxes (that comes last). Most of the developed or semi-developed world is starting to get hit on demographics at the same time. The weaker economic nations are being forced to respond first, as in Russia having to raise their pension ages so high it starts to cut people off at the life expectancy line (plunging Putin's popularity numbers in a rather startling fashion, which tells you how important the pension promises were). France is being forced to confront similar problems, with Macron trying to dress that up as market reforms. The US is temporarily avoiding it thanks to its ability to run absurdly high budget deficits for now.
- manfredo 8y ago
  I agree with the economic implications. Countries that experience an ageing population need to face the fact that they either have to raise taxes considerably, or reduce the care and benefits they extend to the elderly. I also disagree heavily with the last paragraph. Creating disincentives for automation is the last thing a country needs when its workforce is shrinking. Automating jobs is a way of expanding the amount of labor available without actually needing more people in the work force. If anything, countries that are experiencing a population decline need to invest in more automation to maintain their economic output.
  - amanaplanacanal 8y ago
    The US doesn't work that way. Taxes and spending have only the loosest correlation. As long as the US Dollar is the worlds reserve currency, it appears there doesn't have to be anything connecting the two. Someday, though...
- Gibbon1 8y ago
  > entitlement-type programs that are built on a ponzi scheme approach to ever larger inflows of tax revenue to support them over time. Stop repeating propaganda please. Entitlement programs are just simple insurance programs. There is nothing ponzi about them.
dragontamer 8y ago
> While it does introduce the dilemma of reducing spending on the elderly We live in a Democracy, and the elderly have the most free time and seem to be the biggest population right now (Baby Boomers). As such, the elderly are always going to be the most powerful voting block (doubly so now that Boomers, the biggest generation by population, is hitting retirement age). Good luck "reducing spending on the elderly" in the coming years. Its politically infeasible on population dynamics alone. When the "lack of children" issue starts to hit 40 years from now, Millennial are going to be retiring. Millennials are the 2nd largest population after the Boomers. So the same issue will hit us again in the long term.
- manfredo 8y ago
  The elderly may be a powerful voting block, but the percentage of people over 65 is still relatively low (~15% in the US). Even in countries with ageing populations, it's nowhere near the majority (Japan is 27%). If taxes to pay for the elderly do become very onerous, 85-75% of the population is going to be against them politically. There are relatively fair measures to pay for their healthcare, like wealth taxes for people beyond retirement age and increasing estate taxes. Or a more politically feasible measure is to make social security means-tested. By far the best solution would be to mandate people to pay into their own retirement funds - Singapore does this. But of course, that would have had to be put in place decades ago.
  - imtringued 8y ago
    Financing isn't the real the problem here. If 30% of the population works and 50% are retired then there are simply not enough workers to produce all the things you have saved up money for which will increase prices and inflate away your money. You can't "save" food and lots of other products the same way you can save money. It will spoil. This is why a home is actually a pretty good investment for retirement. If you buy it in your 40s then you will still have it in your 80s. More output while at the same time reducing workers means more productivity is required and to increase the productivity per worker we need far more automation. Things like truck/taxi automation might cause a temporary mass unemployment problem for unskilled workers but at the same time also solve the worker shortage that will happen when the population starts aging massively.
api 8y ago
It's not necessarily a bad thing, but it completely breaks all of modern finance.
- pauljurczak 8y ago
  Great!
  - toomuchtodo 8y ago
    Don’t get too excited about tearing engines off an in flight aircraft unless you have an acceptable substitute ready.
dgudkov 8y ago
>Is a shrinking population actually bad in the long term? Technically speaking, for all known biological species, the size of population is the primary indicator of health and well-being. Shrinking population indicates either inability to adapt, or some kind of malaise.
- deleted 8y ago
  [deleted]
rz2k 8y ago
A new equilibrium with a smaller population, after the problem of an old population had passed, would still imply less room for specialization, and therefore less per capita productivity, and ultimately lower quality of life. Instead of more natural resources available per person, a less productive economy eventually provides for fewer resources in terms of goods, services and capital like installed infrastructure per person that are necessary to thrive.
- lkrubner 8y ago
  That's a moot point for as long as we still have 3.5 billion people engaged in subsistence level farming. All of them need to be brought into the modern economy, and taught a specialty. In other words, if 50% of the human race is still wasting its time with farming practices that have barely changed since the Neolithic, then there are still a lot of ways to grow the economy, even if the population is falling.

hn_throwaway_99 8y ago

While this may be true, it's not that much of an exaggeration to say that capitalism is a Ponzi scheme. At the very least our current economic system is dependent on continuous growth, including population growth, and when that ends there will be a world of hurt.

manfredo 8y ago
> and when that ends there will be a world of hurt. First world countries' with shrinking populations aren't falling apart. Sure places like Japan, Italy, and Spain have economic troubles associated with a growing retirement population, and shrinking workforce. But they're still pretty good places to live in. While global growth would decline, I'm dubious of the claim that per-capita wealth would go down. With the same pool of resources spread across fewer people, the opposite seems likely. The labor force would reduce in size, too, so manufactured goods and services may not see their prices go down. But things that are zero-sum like natural resources, real-estate, etc. should drop in cost as fewer people are competing for them.
- Gibbon1 8y ago
  I take the argument that from an economists view point negative population growth is a very bad thing indeed. But from an individuals point of view actually not. Because the economist only cares about total 'GDP' and is absolutely uninterested in quality of life. Because quality of life can't be monetized. From an individuals point of view lower population means fix resources are spread less thinly. There is less competition for jobs so you can command a large share of the pie.
  - bodas 8y ago
    There may be less competition for jobs but when you're elderly there's more competition for people to take care of you.
    - toasterlovin 8y ago
      Old people have resources, though, so NBD. Reasonable societal arrangements should favor new families at the expense of old folks.
      - Gibbon1 8y ago
        Old people often don't use that many resources either at least while they are in good health. Most of the costs are associated with the last year or two of life. SO that expense is already committed to when they born.

adventured 8y ago

The sole problem from population contraction, is replacement tax dollars for existing entitlement-type programs that are built on a ponzi scheme approach to ever larger inflows of tax revenue to support them over time. Most of the developed world has the same problem on that front. The desperation by these countries when it comes to figuring out how to patch up the finances of those programs will increase by the year. Robot (productivity) taxes will be one small answer. Another will be ever higher income taxes, also eventually including heavy wealth taxes (that comes last). Most of the developed or semi-developed world is starting to get hit on demographics at the same time. The weaker economic nations are being forced to respond first, as in Russia having to raise their pension ages so high it starts to cut people off at the life expectancy line (plunging Putin's popularity numbers in a rather startling fashion, which tells you how important the pension promises were). France is being forced to confront similar problems, with Macron trying to dress that up as market reforms. The US is temporarily avoiding it thanks to its ability to run absurdly high budget deficits for now.

manfredo 8y ago
I agree with the economic implications. Countries that experience an ageing population need to face the fact that they either have to raise taxes considerably, or reduce the care and benefits they extend to the elderly. I also disagree heavily with the last paragraph. Creating disincentives for automation is the last thing a country needs when its workforce is shrinking. Automating jobs is a way of expanding the amount of labor available without actually needing more people in the work force. If anything, countries that are experiencing a population decline need to invest in more automation to maintain their economic output.
- amanaplanacanal 8y ago
  The US doesn't work that way. Taxes and spending have only the loosest correlation. As long as the US Dollar is the worlds reserve currency, it appears there doesn't have to be anything connecting the two. Someday, though...
Gibbon1 8y ago
> entitlement-type programs that are built on a ponzi scheme approach to ever larger inflows of tax revenue to support them over time. Stop repeating propaganda please. Entitlement programs are just simple insurance programs. There is nothing ponzi about them.

dragontamer 8y ago

> While it does introduce the dilemma of reducing spending on the elderly We live in a Democracy, and the elderly have the most free time and seem to be the biggest population right now (Baby Boomers). As such, the elderly are always going to be the most powerful voting block (doubly so now that Boomers, the biggest generation by population, is hitting retirement age). Good luck "reducing spending on the elderly" in the coming years. Its politically infeasible on population dynamics alone. When the "lack of children" issue starts to hit 40 years from now, Millennial are going to be retiring. Millennials are the 2nd largest population after the Boomers. So the same issue will hit us again in the long term.

manfredo 8y ago
The elderly may be a powerful voting block, but the percentage of people over 65 is still relatively low (~15% in the US). Even in countries with ageing populations, it's nowhere near the majority (Japan is 27%). If taxes to pay for the elderly do become very onerous, 85-75% of the population is going to be against them politically. There are relatively fair measures to pay for their healthcare, like wealth taxes for people beyond retirement age and increasing estate taxes. Or a more politically feasible measure is to make social security means-tested. By far the best solution would be to mandate people to pay into their own retirement funds - Singapore does this. But of course, that would have had to be put in place decades ago.
- imtringued 8y ago
  Financing isn't the real the problem here. If 30% of the population works and 50% are retired then there are simply not enough workers to produce all the things you have saved up money for which will increase prices and inflate away your money. You can't "save" food and lots of other products the same way you can save money. It will spoil. This is why a home is actually a pretty good investment for retirement. If you buy it in your 40s then you will still have it in your 80s. More output while at the same time reducing workers means more productivity is required and to increase the productivity per worker we need far more automation. Things like truck/taxi automation might cause a temporary mass unemployment problem for unskilled workers but at the same time also solve the worker shortage that will happen when the population starts aging massively.

api 8y ago

It's not necessarily a bad thing, but it completely breaks all of modern finance.

pauljurczak 8y ago
Great!
- toomuchtodo 8y ago
  Don’t get too excited about tearing engines off an in flight aircraft unless you have an acceptable substitute ready.

dgudkov 8y ago

>Is a shrinking population actually bad in the long term? Technically speaking, for all known biological species, the size of population is the primary indicator of health and well-being. Shrinking population indicates either inability to adapt, or some kind of malaise.

deleted 8y ago
[deleted]

rz2k 8y ago

A new equilibrium with a smaller population, after the problem of an old population had passed, would still imply less room for specialization, and therefore less per capita productivity, and ultimately lower quality of life. Instead of more natural resources available per person, a less productive economy eventually provides for fewer resources in terms of goods, services and capital like installed infrastructure per person that are necessary to thrive.

lkrubner 8y ago
That's a moot point for as long as we still have 3.5 billion people engaged in subsistence level farming. All of them need to be brought into the modern economy, and taught a specialty. In other words, if 50% of the human race is still wasting its time with farming practices that have barely changed since the Neolithic, then there are still a lot of ways to grow the economy, even if the population is falling.