When people start having fewer children, there will in time be a shortage of adults. That’s a basic demographic fact that the celebrators of the nation’s increasingly racially diverse population tend to skate over without noticing.
The news here is not as bad as in Europe, but it’s bad nonetheless. The Pew Charitable Trust has an interesting report, based on estimates developed from Census data, on how many Northeastern and Midwestern states stand to lose working-age population (defined as people age 25 to 54) over the next 25 years.
I think the estimates, made by the University of Virginia’s Demographic Research Group, are dubious. The estimators seem to be making straight-line extrapolations from recent data, which may not be sustainable over time. For example, they envision a 47 percent increase in working-age population from 2010 to 2040 in North Dakota; that’s only going to happen if the shale oil boom keeps drawing large numbers of people to move in, which has already stopped happening as oil prices have dropped.
Nonetheless, the basic point is worth making. States that continue to have aging populations, low birth rates and domestic out-migration are liable to have shrinking working-age populations absent really heavy international immigration. If you aggregate the different regions, you find that the estimate is that the South (defined as the 11 Confederate states plus West Virginia, Kentucky and Oklahoma) in 2040 will have more working-age residents than the East and Midwest combined.
Shrinking-age work forces mean lagging economic production — and lagging state tax revenues. Which brings to mind the fact that state policy can make a big difference. If South Dakota Gov. Bill Janklow hadn’t abolished the state’s anti-usury law in the inflationary 1970s, which led to an influx of banking and credit card jobs to Sioux Falls, S.D., would not be a total and working-age population gainer as it is today. If Gov. Lowell Weicker had not imposed a state income tax in Connecticut and had his successors not raised it, Connecticut would not be bleeding working-age people as it is well on its way to doing. Policy can change demographics.
Another way in which declining population can hurt the United States and especially Europe is the subject of an American Interest blog post by Andrew Michta. Donald Trump is not the first presidential candidate to lament the low level of defense spending and military readiness among our NATO allies. But things could be worse, and probably will be. As Michta writes, “the accelerated aging of the population, especially in Europe, is an unaddressed issue that is going to shape the continent’s ability to field sufficient military forces in the coming years. In some countries it will call into question their ability to field a viable military force at all.”
For years, high-minded liberals have called for reducing population growth. But you can reduce it too much — too much, that is, if you care about things like economic growth and military capability. Governments can always tax and conscript people — unless the people simply aren’t there.
