Mind the Baby Gap

How to Boost Birthrates and Avoid Demographic Decline
By Steven Philip Kramer, Published The Straits Times, 7 May 2012

FOR most of human history, high birth rates and high mortality rates have tended to balance each other out.

That began to change in the 19th century, when better sanitation and nutrition extended life spans. The world's population surged from about one billion in 1800 to seven billion today.

Although overpopulation plagues much of the developing world, many developed societies now suffer from the opposite problem: Birth rates have become so low that each generation is smaller than the previous one.

Much of southern and eastern Europe, as well as Austria, Germany, Russia and the developed nations of South-east Asia, have alarmingly low fertility rates, with women having, on average, fewer than 1.5 children each.

For example, the total fertility rate (TFR) is 1.6 in Russia, 1.4 in Poland and 1.2 in South Korea. In the United States, it is 2.05, which is about the replacement level.

At the same time as women are having fewer children in developed countries, life expectancies there have reached record highs. As a result, the dependency ratio - the ratio of the working population to the non-working population - has become increasingly unfavourable, and it is projected to get even worse.

In many countries, the age distribution will someday resemble that of an inverted pyramid, with a bulge of the elderly perched precariously on a narrow base of the young.

With fewer working-age people to tax, governments will have to choose from among several unpleasant options: cutting benefits, raising the retirement age, or hiking taxes. To make matters worse, economic growth will get harder to achieve as workers age and their ranks dwindle; ageing societies will have a tough time succeeding in an era of rapid technological change, which requires flexible employees.

Low birth rates threaten not only the viability of the developed world's welfare states but also developed countries' very survival. In many parts of Europe and Asia, depopulation is a real possibility.

Countries there are at risk of falling into what demographers call 'the low fertility trap', a vicious circle whereby fewer and fewer women have fewer and fewer children, leading to an accelerating spiral of depopulation.

In some countries, such as Austria and Germany, it may already be too late: Surveys show that women there desire an average of only 1.7 children, well below the level needed to keep these countries' populations from shrinking, and they actually have an average of about 1.3 children.

A subculture of childlessness has already developed in these countries; many people choose to have no children at all.

Low birth rates are also changing the world's population balance, with poorer countries dwarfing richer ones.

The population of Pakistan, to name just one developing country, rose from around 50 million in 1960 to about 190 million today, whereas the French population grew from about 45 million to 65 million in the same period.

It is not hard to imagine a future in which advanced countries resemble small islands in a Third World sea. At some point, the population gap between the rich and the poor could grow so large that some developed countries will have to accept massive inflows of immigrants to meet their economies' labour needs. But that much immigration would likely prove politically unpalatable.

Population decline poses a grave danger to the developed world. Yet there is nothing inevitable about it.

History shows that governments can raise birth rates close to replacement levels - if only they adopt the right pronatalist policies. This means making available high-quality and affordable child care, offering families financial support and supporting mothers who pursue careers.

Making motherhood work

IF DEVELOPED countries with low birth rates want to raise them, they should look at what has worked for others in the past. Countries that have not addressed gender inequality or provided adequate social services, such as Italy and Japan, have failed to nudge up their birth rates.

But other countries, such as France and Sweden, have crafted thoughtful, comprehensive and consistent policy responses that have largely reversed their declining birth rates over the long run.

France was the first country to experience a declining birth rate in the 19th century. Small landowners there chose to have fewer children so as to avoid dividing their farms among too many of them, and people in the middle class wanted to encourage social mobility by investing their resources in just a few children.

As the country's population growth slowed, the French became concerned about the national security implications.

France's defeat in the Franco-Prussian War of 1870-71 transformed the country's low birth rate into a political issue, since its arch-enemy, Germany, was experiencing rapid population expansion.

The French and German populations were about equal in 1871; by 1914, the German figure was about 50 per cent larger. Yet because it espoused limited government, then-France did not take meaningful steps towards a pronatalist policy until the very eve of World War II.

In 1939, Paris passed the Code de la Famille which provided financial support to parents.

After World War II, French leaders blamed the country's defeat in 1940 on its stagnating demographic, economic and social development. If France was to regain the status to which President Charles de Gaulle and other leaders aspired, it needed a new dynamism: more social justice, a stronger economy and faster population growth.

So France tried to plan itself out of industrial underdevelopment and demographic decay and it did so through, above all, a generous programme of financial support for families with children.

Birth rates there rose to well over the replacement level.

These postwar policies were aimed at strengthening the 'traditional' family. But by the late 1960s, that model was falling out of favour. The baby boom was ending. Women were joining the workforce in increasing numbers, and French economic development required their participation. Instead of viewing women's careers as a threat to birth rates, pronatalists began to advocate reconciling work and family.

That approach had worked in Sweden, another country that suffered from extremely low birth rates in the 1930s.

When the Swedish Social Democrats came to power at the height of the Great Depression, one of their economic strategists was Mr Gunnar Myrdal, who in 1934 wrote a best-selling book with his wife, Alva, on the population crisis.

The Myrdals argued that if Sweden was to boost its low birth rate, women had to be able to raise children and have careers, a revolutionary idea at the time.

Because children were a crucial investment for society but an economic burden for individual families, the argument ran, the government needed to redistribute wealth from households with few or no children to those with many.

It had to eliminate the obstacles - such as the sheer cost of raising children - that prevented ordinary people from following their wishes to marry and procreate. Unlike conservative pronatalists, the Myrdals supported the right to contraception. It was good that families should want children, but they should have only the children they wanted.

Today, France and Sweden both devote approximately 4 per cent of their gross domestic products to supporting families.

The Swedish model provides new parents with over one year of paid leave based on their salaries, which can be divided between the father and the mother.

Most Swedes send their children to the renowned public preschool system. Women have the right to return to their jobs after maternity leave on a full-time or part-time basis.

The French system, for its part, offers mothers more financial incentives and focuses less on early child care. But France does provide an outstanding free preschool (ecole maternelle), which most children attend after age three and which is run by the Ministry of Education.

Both the French and the Swedish systems eliminate much of the financial burden on parents and, above all, the stress of struggling to balance work and family. As a result, both countries enjoy healthy birth rates: near replacement level in France and slightly below replacement level in Sweden.

Gone babies gone

UNLIKE France and Sweden, other countries trying to promote childbirth have adopted ineffective policies, have instituted no policies at all, or have succumbed to cultural impediments.

In Italy, the problem was a sluggish state that did not even try to challenge norms about childbearing. The Italian birth rate fell below the replacement level in the 1970s, but only in the 1990s did Rome recognise the extent of the problem, when the underdeveloped welfare state was already stretched to capacity. So the country essentially did nothing.

Many other factors have kept Italy from adopting effective policies. The powerful Catholic Church, which supports the traditional model of stay-at-home motherhood, looks askance at increasing social services that enable women to reconcile work and family.

Young people, who have a hard time finding jobs and rental housing, tend to live with their parents into their 30s, and so they put off starting families.

The legacy of fascist Italy's heavy-handed pronatalist policies - Benito Mussolini even instituted a tax on celibate men in 1926 - has created a taboo against state involvement in family affairs (or at least an excuse for inaction). Italy's broken bureaucracies, stalemated political system and chronic financial problems have all got in the way too.

The results are ominous. By last year, Italy's TFR had dropped to 1.42. As the demographer Massimo Livi-Bacci predicted in 2001, 'the current fertility rate implies the halving of the Italian population every 40 years. Thirty years from now, women over 80 would be more numerous than girls under puberty, and those over 70 would exceed those below 30'.

Like Italy, Japan faces a population implosion, with its TFR at 1.21. The Japanese are ageing at an alarming rate.

Demographers predict that by 2014, 25 per cent of the population will be older than 65, and by 2050, that proportion will have jumped to nearly 38 per cent. Since 2005, when the country counted 128 million inhabitants, Japan's absolute population has been declining; by 2050, it could fall to about 100 million.

And unlike in Italy, there is almost no immigration to speak of.

The Japanese government has pursued policies aimed at increasing the birth rate, but these have been too half-hearted. Employers are part of the problem, forcing women to choose between family and career. Women who have children are often unable to return to professional-level jobs, and businesses resist reducing long working hours.

Although there are many laws on the books that purport to remedy this situation - for example, the 1994 Angel Plan, the 1995 Child Care and Family Care Leave Act and the 1999 New Angel Plan - they often go unenforced. And so more women marry later (or never) and the married ones are having fewer children.

Demographics and destiny

IN ITALY and Japan, politicians evince a kind of pervasive fatalism about their population declines. Part of the reason is that these are still wealthy societies and the effects of their falling birth rates have yet to be really felt.

By its very nature, population decline is incremental, so there never really is a population crisis.

And without a crisis, politicians relegate the issue to the back burner.

Policymakers in these countries also fail to act because they hold misguided views about population. Some still fear overpopulation or argue that lower population numbers will help preserve the environment. (That they would admittedly do, but environmental degradation is a lesser threat than depopulation.)

Others insist that the government cannot and should not intervene in a domain regarded as private. Still others incorrectly assume that the problem will take care of itself; many of the countries affected by falling birth rates, such as Spain, enjoyed high birth rates until recently (in some cases, they had instituted programmes to reduce fertility) and do not recognise that their birth rates will probably not rebound from their current low levels without help.

But demographics are not self-regulating, and successful population policies require governments to make long-term investments in encouraging childbirth.

This means a great deal of financial support, even in times of austerity; when it comes to population policies, there is no such thing as short-term success. In order to bear fruit, the policies must be consistent and predictable, so they have to be based on broad national consensus.

Gender equality is also an important ingredient, as are carefully managed immigration and the acceptance of non-traditional family structures, such as unmarried cohabitation. After all, the countries most committed to the traditional family, such as Germany, Italy and Japan, have the lowest birth rates.

Countries with high birth rates, in contrast, usually also have large numbers of children born out of wedlock.

These babies are born not primarily to teenagers but largely to women in their late 20s and 30s, many of whom are in committed relationships.

Governments trying to institute pro-natalist policies will face an uphill battle. In the past, such policies were closely related to the rise of the welfare state, which came into being at a time of sustained economic growth in the developed world.

But the welfare state in the West has been embattled for a long time, threatened by neoliberal economic thinking, the rise of cheap foreign labour, growing inequality and the recent global economic crisis. Meanwhile, young people are having a harder time finding steady, well-paying jobs. They are likely to postpone beginning families, or never have any children.

Public policy can narrow the gap between the number of children women say they want and the number they actually have. But the right kind of programmes, such as those in France and Sweden, are expensive, and they may clash with vested interests and anger supporters of the traditional family - which is why many developed societies have done nothing or have employed useless half-measures.

Countries that fail to take low birth rates seriously do so at their own peril.

Time matters. If they wait too long and get caught in the low fertility trap, they could find themselves in an uncharted era of depopulation that will be eerily different from anything before.

And escaping that scenario will be difficult, if not impossible.

The writer is professor of grand strategy at the United States' National Defence University's Industrial College of the Armed Forces.
This article first appeared in the May/June issue of Foreign Affairs magazine.