What's Really Behind Our Economic Slowdown?
Our economic slowdown won't pick up anytime soon. An important article in the Wall Street Journal explains why. It's a long rather somber overview of the implications of the fact that the birthrate in the U.S. has slipped below "replacement" level. What this means is that, unless the trend is reversed, at some point the population of our country will begin to dwindle.
This has already occurred in Japan. In 1980, the warning bells sounded in Japan, as the author of the article, Johnathan Last notes, but no one paid attention. At the time, Japan's economy was booming and everyone thought that Japan would - in an economic sense - take over the world. But the Japanese economy turned south at the end of the 80s and hasn't really turned around since. They've been in a prolonged deflationary period, a kind of mild depression, since then. Then, as predicted, in 2008, the Japanese population began to decline. Since 2008, Japan's population has fallen by one million people.
So will the U.S. follow Japan? One reason people believe the U.S. is different is that we, unlike the Japanese, welcome immigrants. But if you read the article, you'll see that the issue of of declining population has begun to effect the entire world. It's quite stunning.
Here's a little snippet from the article:
This has already occurred in Japan. In 1980, the warning bells sounded in Japan, as the author of the article, Johnathan Last notes, but no one paid attention. At the time, Japan's economy was booming and everyone thought that Japan would - in an economic sense - take over the world. But the Japanese economy turned south at the end of the 80s and hasn't really turned around since. They've been in a prolonged deflationary period, a kind of mild depression, since then. Then, as predicted, in 2008, the Japanese population began to decline. Since 2008, Japan's population has fallen by one million people.
So will the U.S. follow Japan? One reason people believe the U.S. is different is that we, unlike the Japanese, welcome immigrants. But if you read the article, you'll see that the issue of of declining population has begun to effect the entire world. It's quite stunning.
Here's a little snippet from the article:
Forget the debt ceiling. Forget the fiscal cliff, the sequestration cliff and the entitlement cliff. Those are all just symptoms. What America really faces is a demographic cliff: The root cause of most of our problems is our declining fertility rate.
You'll find the rest of the article by clicking HERE.
It's well worth reading and we'll have more to say about this in the future.
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