The driving force behind everything I write about the future of capitalism is our undeniable trend towards global population decline. By some estimates that will be circa 2050, globally, but as we know many individual countries are already experiencing it.

When natural birth rates are below replacement levels, immigration is the answer. In racist countries like Hungary, who basically don’t have immigration, their future looks dire. In other lands with healthy immigration, they can postpone their degrowth for quite a while. Obviously not every country can gain immigrants if the global population is reducing…

Did I just say dire? Here’s the thing – our current form of capitalism does not work without growth, and population growth fuels that. It is a primary reason why the governments of countries like the US and Australia choose to have steady, balanced immigration.

Racism is bad for a country’s immediate capitalistic future if that means fewer people are living in their country each year, because of an intolerance for immigration of people with different cultural backgrounds and skin colors.

But racism can save capitalism, by asking one of the questions that rarely gets asked about capitalism.

Here’s the plan:

1. Start a political party that focuses on population and sustainability. Australia currently has the Sustainable Australia party. Some people think it is thinly disguised racism, but they say they want to limit immigration for more noble reasons.
2. Get immigration discussed in political debates. Get this question out there, and repeatedly, doggedly, ask it: Why Do We Need Immigration? What Purpose Does It Serve?
3. The only expected response, hopefully from a prominent government official, is that we need immigration to drive economic growth.
4. Then we can ask part 2, giving us 30 years to find a solution. What Will Happen To Capitalism When We Have Negative Population Growth?

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Just like we don’t question the idea of profiting from owning a house, we grumble about, but don’t question, the absurdity of paying almost as much for childcare as you earn from going to work. It is perhaps a remnant of patriarchy, punishing (typically) a woman for choosing not to be a full-time Mum. Yet the desire to work is so strong in many women that they do so, and are apart from their children, for low financial gain. Regardless of your opinion on how parenting should look, we know that many women want to be a mother and also work. That alone is a strong argument against the idea that the UBI will lead to laziness.

Free child care is UBI by stealth, given without question to parents who choose to work when they have pre-school children (it should also be extended to after school care for older kids). And it isn’t so radical, many advanced economies already give benefits and tax credits to those who have children – this is just the next natural step.

When the cost of child care is removed from the equation, parents can make genuine decisions around whether they should work, or not. Instead of the absurd situation of literally paying a fee for the privilege to work, like the cost of commuting on steroids. Nobody would take a job when 75% of your pay is spent on the commute, and yet working parents do exactly that with child care. Like the UBI, free child care enables us to have more freedom and choice.

When the concept is being debated, we can bring up the value provided by carers, and argue that the role they play in society is worthy of higher pay. Child care is predominantly a female profession, is seen by some men as being an easy and unskilled role, and is a key aspect of why women are paid less than men in aggregate. 

Free child care would be a boost to the economy. The recipients are not the parents, but the child care industry, providing jobs and growth. The parents get to work more, which is also a boost. And, if we want to delay population decline, it will certainly lead to more babies, perhaps more than any other incentives that have been tried.

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After saying that a fertility rate of 1.65 would lead to a stable population (zero growth or loss), because of the rates of immigration…

“In contrast to the outcomes if the population stabilised at around 24 million, if our fertility rate were to fall much below 1.6 there could be serious economic and public financing implications. This is a plausible possibility,” the department warned.

The news article doesn’t elaborate, and the actual papers are not available online yet. I would love to see the details around serious economic implications. It looks like the papers are called [Standing Committee on Ageing Inquiry into long term strategies to address the ageing of Australian population over the next 40 years]

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Because capitalism won’t cope with a population that gets smaller and smaller, in some countries politicians will do their best to promote having more children:

• baby bonus
• long maternity leave
• free childcare and pre-school education
• tax breaks

This already occurs in a few lands and typically isn’t enough to get the fertility rate above 2.1. It also means that the increase in children will come from poor people – those who relatively benefit the most from the bribes.

Imagine a politician who is disgusted by poor people breeding more than the elite. He/she/they might decide to turn the incentive idea upside down.

Instead of incentivising more births, they could tax those who refrain. Childless couples benefit enormously financially, relative to those who propagate the species. Anyone who has mature gay couple friends (I’m generalising) can attest to their disposable income.

If the tax is progressive, and doesn’t kick in for those below the median income, then it doesn’t encourage poor people to have children, but it strongly encourages the rich to do so.

It could also be seen as a way of punishing male same sex couples.

Just to repeat, I am not advocating this, I’m just turning things upside down as I am with everything else, and considering what may result.

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This study’s prediction for Africa, growing by an extra 2 billion people, seems highly speculative to me. It suggests they will primarily remain in poverty, even though they are the natural inheritor of the cheapest labor for factories, something that brought many Asian countries out of poverty.

I still believe that the global population peaking in 2050 is the most likely scenario.

By century’s end, 183 of 195 countries—barring an influx of immigrants—will have fallen below the replacement threshold needed to maintain population levels, an international team of researchers reported in The Lancet.

More than 20 countries—including Japan, Spain, Italy, Thailand, Portugal, South Korea and Poland—will see their numbers diminish by at least half.

China’s will fall nearly that much, from 1.4 billion people today to 730 million in 80 years.

Sub-Saharan Africa, meanwhile, will triple in size to some three billion people, with Nigeria alone expanding to almost 800 million in 2100, second only to India’s 1.1 billion.

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