Aging Populations and Replacement Birthrate

Posted by PITHOCRATES - April 28th, 2014

Economics 101

(Originally published July 8th, 2013)

Trying to follow a Baby Boom with a Baby Bust creates Problems in Advanced Economies with Large Welfare States

In the late 1960s began a movement for zero population growth.  It called for women to have only enough babies to replace the current population.  Not to have too many babies that would increase the population.  Nor have too few babies that the population declines.  Something that women could easily do because of birth control.  And, later, abortion.  The drive behind this was to save the planet.  By keeping large populations becoming like a plague of locusts that devour the earth’s resources and food until the planet can no longer sustain life.

China did these zero population growth people better.  By promoting a negative population growth rate.  Limiting parents to one child.  They did this because during the days of Mao’s China the country set some world records for famine.  Their communist state simply couldn’t provide for her people.  So to help their communist system avoid future famines they tried to limit the number of mouths they had to feed.  Of course, trying to follow a baby boom with a baby bust creates other problems.  Especially in advanced economies with large welfare states.

China’s one-child policy and the preference for boys have led to a shortage of women to marry.  Some Chinese men are even looking at ‘mail-order’ brides from surrounding countries.  But China is going to have an even greater problem caring for her elderly.  Just like Japan.  Japanese couples are having less than 1.5 babies per couple.  Meaning that each successive generation will be smaller than the preceding generation.  As couples aren’t even having enough children to replace themselves when they die.  Leaving the eldest generation the largest percentage of the overall population.  Being paid and cared for by the smallest percentage of the overall population.  The younger generation.

States with Aging Populations are Suffering Debt Crises because they Spend More than their Tax Revenue can Cover

As nations develop advanced economies people develop careers.  Moving from one well-paid job to another.  As they advance in their career.  Creating a lot of income to tax.  Allowing a large welfare state.  Which is similar to a Ponzi scheme.  Or pyramid scheme.  As long as more people are entering the workforce than leaving it their income taxes can pay for the small group at the top of the pyramid that leaves the workforce and begins consuming pension and health care benefits in their retirement.  And there is but one requirement of a successful pyramid scheme.  The base of the pyramid must expand greater than the tip of the pyramid.  The wider the base is relative to the top the more successive the pyramid scheme.  As we can see here.

Babies per Generation - Constant Replacement Birthrate

Generation 1 is at the top of the pyramid.  It is the oldest generation.  Which we approximate as a period of 20 years.  In our example Generation 1 are people aged 78-98.  They’re retired and collecting pension, health care and other benefits.  Some combination of Social Security, Medicare, Medicaid, food stamps, heating assistance, etc.  All paid for by Generation 2 (58-78), Generation 3 (38-58) and Generation 4 (18-38).  Each generation is assumed to bring 6 children into the world.  So these couples are not only replacing themselves but adding an additional 4 children to further increase the size of the population.  Which really makes running a pyramid scheme easy.  For if we assume each member in Generation 1 on average consumes $35,000 annually in benefits that Generations 2 through 4 pay for that comes to $555.56 per person annually.  Or $46.30 per person monthly.  Or $10.68 per person weekly.  Or $1.53 per person daily.  Amounts so small that Generations 2 through 4 can easily pay for Generation 1′s retirement.  Now let’s look at the impact of a declining birthrate with each successive generation.

Babies per Generation - Declining Replacement Birthrate

When all couples in each generation were having on average 6 children this added 1.9 billion new taxpayers.  Which greatly reduced each taxpayer’s share of Generation 1′s retirement costs.  But thanks to birth control, abortion and the growing cost of living each successive generation has fewer babies.  Generation 2 only has 3 children.  Enough to replace themselves.  And add one new taxpayer.  Generation 3 has only 2 children.  Only enough to replace the parents.  Providing that zero population growth that was all the rage during the late 1960s and the 1970s.  While Generation 4 only has 1 child.  Not even enough to replace the parents when they die.  Causing a negative population growth rate.  Which is a big problem in an advanced economy with a large welfare state.  For instead of adding 1.9 billion new taxpayers they only add 217.5 million new taxpayers.  Greatly increasing each taxpayer’s share of Generation 1′s retirement costs.  Instead of paying $555.56 per taxpayer they each have to pay $5,384.62 annually.  Or $448.72 per taxpayer monthly.  Or $103.55 per taxpayer weekly.  Or $14.79 per taxpayer daily.  Numbers that prove to be unsustainable.  The state simply cannot tax people this much for Generation 1′s retirement.  For if they did this and added it to the rest of government’s spending they’re taxing us to fund it would take away all of our income.  This is why advanced economies with aging populations are suffering debt crises.  Because their spending has grown so far beyond their ability to pay for it with tax revenue that they borrow massive amounts of money to finance it.

If you want a Generous Welfare State you need Parents to have More Children

If you carry this out two more generations so every generation only has one child the per taxpayer amount tops out at $14,736.84 annually.  Or $1,228.07 per taxpayer monthly.  Or $283.40 per taxpayer weekly.  Or $40.49 per taxpayer daily.  Amounts far too great for most taxpayers to pay.  This is what an aging population does in a country with a large welfare state.  It makes the population top-heavy in elderly people who no longer work (i.e., pay taxes) but consume the lion’s share of state benefits.  When couples were having 6 children each across the generations there was a ratio of 84 taxpayers per retiree.  When there was a declining replacement birthrate that ratio fell to 15 taxpayers per retiree.  If we look at this graphically we can see the pyramid shape of this generational population.

Generational Population - Constant Replacement Birthrate

With 84 taxpayers per retiree we can see a nice and wide base to the pyramid.  While the tip of the pyramid is only a small sliver of the base (Generation 4).  Making for a successful Ponzi scheme.  Far more people pay into the scheme.  While only a tiny few take money out of the scheme.  This is why Social Security and Medicare didn’t have any solvency problems until after birth control and abortion.  For these gave us a declining replacement birthrate over time.  Greatly shrinking the base of the pyramid.  Which made the tip no longer a small sliver of the base.  But much closer in size to the base.  That if it was an actual pyramid sitting on the ground it wouldn’t take much to push it over.  Unlike the above pyramid.  That we could never push over.  Which is why the above Ponzi scheme would probably never fail.  While the one below will definitely fail.

Generational Population - Declining Replacement Birthrate

If you want a generous welfare state where the state provides pensions, health care, housing and food allowances, etc., you need parents to have more children.  For the more children they have the more future taxpayers there will be.  Or you at least need a constant replacement birthrate.  But if that rate is below the rate of a prior baby boom the welfare state will be unsustainable UNLESS they slash spending.  The United States has a replacement birthrate below the rate of a prior baby boom.  While the Obama administration has exploded the size of welfare state.  Especially with the addition of Obamacare.  Making our Ponzi scheme more like the second chart.  As we currently have approximately 1.75 taxpayers supporting each social security recipient.  Meaning that it won’t take much pushing to topple our pyramid. We’re at the point where a slight breeze may do the trick.  For it will topple.  It’s just a matter of time.

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Postponing Motherhood may be good for Busy Women but not for their Children

Posted by PITHOCRATES - April 17th, 2014

Week in Review

Once upon a time I was having a conversation with a consultant.  He was bald.  And not in the best of shape.  He looked older than he was.  He started a family later in life.  And one of the worst days of his life was when a waitress said how cute his grandson was.  Because he looked like a grandfather.  Even though he was only a father.

I had a coworker who died from a heart attack while on vacation.  Running around with his grade-school-aged children.  Another father who started his family later in life.  It was not a problem for him.  For men don’t have a biological clock ticking.  So they can start a family as late as they want to in their life.  But they may not live to see their children graduate from high school.  Which is a horrible thing for a child.

This was something women were spared.  Because they have a biological clock ticking.  And couldn’t put off becoming a mother until they were ‘grandmother age’.  Until now, that is (see Later, Baby: Will Freezing Your Eggs Free Your Career? by Emma Rosenblum posted 4/17/2014 on BloombergBusinessweek Technology).

LaJoie fits the typical profile of an egg freezer: They’re great at their jobs, they make a ton of money, and they’ve followed all of Sheryl Sandberg’s advice. But the husband and baby haven’t materialized, and they can recite the stats about their rapidly decreasing fertility as a depressing party trick. For LaJoie, now 45, it was demoralizing to see friend after friend get married and have kids, while she was stuck at the hospital without romantic prospects.

“You feel bad about yourself, like you’re the odd man out, and somehow you’ve messed up on your path,” says Sarah Elizabeth Richards, who spent $50,000 freezing several rounds of eggs in 2006 to 2008 and wrote a book about the experience, Motherhood, Rescheduled: The New Frontier of Egg Freezing and the Women Who Tried It. “By freezing, you’ve done something about it. You’re walking taller; your head is held higher. And that can pay off in both your work and romantic lives.” Richards, now 43, is dating someone promising and says she’d like to thaw her eggs in the next year or so. She’s also at work on a new book and plans on finishing it before she tries to get pregnant. “Egg freezing gives you the gift of time to start a family, but it’s also, like, here’s how many years I actually have left for my other goals—what can I do with them?”

LaJoie got married soon after she froze (she told her husband about it on their very first date: “I was upfront and said, ‘This is my plan.’ He was, like, ‘OK!’ ”) and had her first baby naturally at 39. A few years later, after briefly trying fertility drugs, she thawed her eggs. The implantation worked, and her second son is 2 years old.

This is great news for women who want to conveniently work in the burden of being a mother somewhere in their busy schedules.  But when you have a child at 43 you will be 51 at that child’s high school graduation.  Old enough to be a grandmother.  While the grandmother may be in a nursing home.  Who may only see her grandchildren on holidays when they reluctantly visit her.  For nursing homes are not places children want to be.

And you could be dead by your child’s graduation.  For a lot of health issues can plague you by the time you turn 51.  Especially when you’re having your children in your 40s.  The risk of breast cancer increases with age.  The risk of hypertension and pre-eclampsia/eclampsia increase with age.  The risk of gestational diabetes increases with age.  The risk of heart disease increases with age.  As does the risk of other cancers, lupus, diabetes, pancreatitis, etc.  Things not that common for women in their 20s and 30s.  But more common for women over 40.

And babies have risks, too, when their mothers give birth when over 40.  The risk of stillbirths and miscarriages increase with age.  As does the risk for birth defects.  So it’s all well and good for the mother to postpone motherhood but it’s not the best thing for her children.  Who deserve young and healthy parents.  Who can run with them while on vacation.  And they deserve healthy grandparents to spoil them.  Things you may not be able to do if you postpone motherhood until after you’re 40.

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Women and Men in the Exact Same Jobs are earning the Exact Same Income

Posted by PITHOCRATES - April 13th, 2014

Week in Review

The Democrats are running out of ways to buy votes.  Which they desperately need as more people suffer the ravages of Obamacare.  Who will be entering the voting booth angry this fall.  Looking for someone to blame for taking away the health insurance and doctors they liked and wanted to keep.  And being that Obamacare was passed on purely partisan lines (no Republicans voted for it) the Democrats are sweating bullets as the midterm elections approach.  So they turn to an oldie but goldie.  The pay gap lie (see What pay gap? Young women out-earn men in cities, GOP pundit claims posted 4/8/2014 on PolitiFact).

We watched the debate play out between conservative pundit Sabrina Schaeffer and liberal pundit Elizabeth Plank on MSNBC’s The Reid Report, and again later between former White House adviser Anita Dunn and conservative pundit Genevieve Wood on CNN’s The Lead with Jake Tapper.

“If you compare women to men in the same job with similar background, similar experiences that they bring to the table, the wage gap all but disappears,” Wood said. “Women have made great strides. Instead of celebrating that, this is a political year, the White House wants to portray this war on women…”

PolitiFact has given you the nuts and bolts about the 77 cents statistic — you can read the two most important works in this area here and here. Basically, there is a wage gap, but it tends to disappear when you compare women and men in the exact same jobs who have the same levels of experience and education.

Well, there it is.  Equal pay for equal work.  When men and women have the same education, experience and skills doing the same job there is no pay gap.  Case closed.  In fact, single women without children are actually earning more than single men.  Which is the key to this argument.  For a woman’s earnings fall with interruptions in her career as she takes time off to have children.  Or works reduced hours to care for her children.  This is where the pay gap comes in.  When you compare apples and oranges.  Comparing women who take time off or cut back their working hours or take lower paying jobs that allow her to spend more time with her children to men who don’t.  Because they’re single.  Or are married and have a wife who takes time off to spend more time with their children.

In fact, women are making great strides.  At the expense of men (see Is the Gender Pay Gap Closing or Has Progress Stalled? by Josh Zumbrun posted 4/11/2014 on The Wall Street Journal).

“There’s no question that one of the things that ‘77 cents’ doesn’t emphasize is that there’s been enormous gains,” said Harvard University economist Claudia Goldin.

Looking at the data above shows three clear trends that have emerged since the 1970s:

1) The spread between the sexes narrowed between 1970 and 2000. It has made little progress since.

2) Men have made no income gains in over four decades. Adjusted for inflation, men earn less today than they did in 1972.

3) Women continued to make gains until the recession began. Whatever forces slowed the income growth of men from 1970 to 2000 did not halt the income growth of women.

Simple economics.  Supply and demand.  Men were making more and more every year.  Until the Sexual Revolution.  When women began to flood the labor market.  With more labor available the cost of labor fell.  So as women gained education and experience the supply of educated and experienced workers grew.  Allowing employers to pay less for these now more plentiful educated and experienced workers.  Which is why as women enjoyed income gains men saw their income decline when adjusted for inflation.  Simple economics.  Supply and demand.

A long time ago in high school chemistry I remember my lab partner did not complete a homework assignment that was part 1 of a 2-part grade.  There was a homework part.  And a lab part.  Being a nice person I asked the teacher if we could share the grade on the homework part (which I had received an ‘A’ on.  Or a 4.0).  The teacher was more than generous.  He said, “Sure.  A 4.0 divided by 2 equals a 2.0 for each.”  Or, a ‘C’ for each.  Suffice it to say my lab partner did not get a 2.0 on the homework that went undone.

This is why men are earning less.  Because women have entered the workforce.  The revenue businesses use to pay their employees didn’t increase like the number of educated and experienced workers did.  So the amount of available revenue for pay and benefits was shared by more people.  Each getting less than a man did before the Sexual Revolution (when adjusted for inflation).  So instead of a single paycheck supporting a family these days it now takes two paychecks.  Because men are making less today since women have lowered the price of labor.  By increasing the supply of labor.  Not because they are paid less.  But because there are so many workers for so few jobs that businesses don’t have to pay as much as they once did to hire people.  Which is more to blame for pressure on wages than any pay gap.

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FT215: “Of course the Republicans are the party of ‘no’ because that’s what grownups say to children.” —Old Pithy

Posted by PITHOCRATES - March 28th, 2014

Fundamental Truth

Children only care about the Here and Now and Instant Gratification

“Mom, can I eat this whole birthday cake?”  “No.”  “Dad, can I stay up past my bed time?”  “No.”  “Mom, can I go out and play instead of cleaning my room?”  “No.”  “Dad, can I skip my homework and play football with the guys?”  “No.”  “Mom, can I go to the concert with Billy and his big brother?”  “No.”  “Dad, can I use your table saw?”  “No.”  “Mom, will you buy me this micro dress for the dance?”  “No.”  “Dad, can I borrow the car this Friday to drive to a party?”  “No.”  “Mom, can I have boys in my bedroom?”  “Hell no.”  “Dad, can I have $50?”  “For what?”  “Stuff?”  “What kind of stuff?”  “You know, stuff.”  “Oh, in that case, no.”

“No.”  It is the most important word in a parent’s vocabulary.  For kids want to do a lot of things that aren’t good for them.  Things that will get them into trouble.  Things that might hurt them.  Things that may leave them with unpleasant and/or long-lasting consequences.  Parents have to say ‘no’ because kids just don’t know any better.  They only think about the here and now.  Not about the future.  They want instant gratification.  They want to have fun.  They don’t want to wait.  They don’t want to work.  And the last thing they want to do is to delay gratification.

So parents have to keep saying ‘no’ for their children’s own good.  At least, responsible parents do.  Because parents are older and wiser than their children.  Contrary to popular belief children have about their parents.  Children like to say that their parents “don’t know anything.”  But they do.  In fact, they know a lot.  Because they were once impulsive children having the same arguments with their parents.  And now that they are parents they see the world differently than they did as children.  They see it as their parents saw it.  And realize that their parents were right all along.  Thanks to a lot more education, a lot more work experience and a lot more life experience.  The things that makes one wiser as one gets older.

Children who never Grow Up as Adults tend to Remain Liberal and Vote Democrat

Children that grow up into responsible adults tend to be more conservative.  They get jobs.  Straight out of high school.  Or after college.  And party less.  They cut back on reckless behavior.  Such as drinking and driving.  Because they realized they could get a DUI.  They could hurt themselves.  Or, worse, hurt someone else.  If they used drugs they cut back.  Some stop using them completely.  They stop having  casual sex with random people.  In part to avoid an STD.  In part because they want something more than just a good time.  So they, instead, get married.  And settle down.  Raise a family.  And it’s about this time that these one-time wild liberals start voting Republican.  As they see there is a lot more to life than partying with booze and drugs.  And having sex.  Especially when they become parents.

Becoming a parent changes a person.  Single coworkers may still want to go out and get a drink after work.  They may look forward to the weekend so they can drink themselves into a stupor.  But not a married person.  At least, not a married responsible grownup.  They want to go straight home to their wife.  Or husband.  They want to spend time with their kids.  And they don’t want to do anything that could harm their kids.  Like risking their job by coming in late hung over after a night of excessive drinking.  They’d rather get to work early.  Do their job.  And build a successful career.  That is both personally satisfying.  And takes care of their family.  Something sobriety helps.  And our days tend to be easier when they don’t start with a hangover.

Children who never grow up as adults, on the other hand, tend to remain liberal.  Focused on the here and now.  Without a thought about the future.  For them gratification is all that matters.  These people tend to keep the wild ways of their youth.  And those who go on to college take it up a notch.  Away from their parents incessant ‘no’s they can finally say ‘yes’ to everything.  And a lot of them do. They’ll get drunk and video things with their smartphones.  And upload them to the Internet.   The kind of things you once had to go to a pornography store to buy.  But they and their friends will post these videos for all the world to see.  And these things will still be floating around the Internet years later when they’re saying ‘no’ to their own children.  Or interviewing for a job.  Jessie Watters on The O’Reilly Factor has interviewed some of these young college students on spring break.   Asking them questions about history.  International events.  Current events at home.  And if they could identify members of the Federal government.  Few could.  Very few.  Because they have more pressing things in their lives apparently than getting an education.  At least based on what they’re doing with their smartphones.

Democrats only care about the Here and Now and Instant Gratification

Liberal Democrats love these kids.  For they know all they want is to have fun.  So they become the party of fun.  Free birth control.  Access to abortion.  Decriminalizing marijuana.  Anti-religion.  No moral absolutes.  Anything goes.  Even encouraging reckless behavior (they’re going to have sex anyway so we might as well make it easier for them).  Veritable anti-parents.  Who tell these kids that they (these kids) know what’s best for them.  Not their parents.  And if they want instant gratification that’s okay.  You don’t have to worry about the future because if you vote Democrat that’s something else we’ll do for you besides the birth control, abortion, marijuana and the lack of moral constraints.  If you vote Democrat we’ll take care of you from cradle to grave.  Just like that The Life of Julia slideshow promised.  With so little education, work experience and life experience these kids don’t know any better and say, “Okay.  Where do I vote.”

So the Democrats use these kids to stay in office.  They know little so it is easy to lie to them.  About the ‘evil Republicans’ that are as big a killjoy as their parents.  And about how much better the Democrats are going to make their lives.  If only they keep voting Democrat.  So they do.  Because the Democrats offer everything an irresponsible adult could want.  Which is a shame as a lot of what the Democrats offer is bad for the rest of us.  And the country.  Their Keynesian economics fails over and over yet they keep using these failed policies of the past.  Putting the country further into debt.  And further depreciating the dollar.  They lie to these kids about global warming.  Allowing the Democrats to remain in power and pass crippling regulations.  Threatening the coal industry.  As well as increasing our energy costs.  They want to raise the minimum wage for unskilled, entry-level jobs.  Reducing the number of entry level jobs available for those looking to enter the workforce.  And they want to take over our health care.  The best health care system in the world.  Replacing it with something not as good and more costly.

But these grand domestic plans require a lot of money.  Which they often get from gutting the defense budget.  Weakening our military (something they never liked to begin with) to free up money for buying votes (i.e., spending) elsewhere.  They help justify this with a horrible foreign policy.  Instead of peace through (costly) strength they choose a ‘please like us’ foreign policy.  Marginalizing American Exceptionalism.  Being kind to our enemies.  And leaving our allies doubting our commitments.  But if our enemies like us we won’t need a large military anymore.  Allowing them to use those defense dollars elsewhere.  And how has that been working out?  Not good.  Since the ‘please like us’ foreign policy juggernaut Egypt is in chaos.  Syria is in a bitter civil war.  Iran is developing a nuclear bomb.  Israel is feeling abandoned.  Al Qaeda is taking over Libya and Iraq.  The Taliban will return to Afghanistan once the U.S. leaves.    North Korea is test-firing ballistic missiles.  And Vladimir Putin is restoring the Soviet Union.  Because he can.  Thanks to America’s new ‘please like us’ foreign policy.  Instead of the peace through strength of previous presidents.  Like Ronald Reagan.  And JFK.

There’s something else children who never grow up do.  Go into politics.  Into the Democrat Party.  Not the Republican Party.  The party the Democrats derisively call the party of ‘no’.  They join the Democrat Party.  And do all of the things that give us the worst economic recovery since that following the Great Depression.  And a more dangerous world.   Despite this they still want to do more.  Without caring what their actions may do to our future.  Just like children.  All they care about is the here and now.  And instant gratification.  So of course the Republicans are the party of ‘no’ because that’s what grownups say to children.  ‘No’.

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A Gun-Less Britain makes Women Easy Prey for Domestic Abuse

Posted by PITHOCRATES - March 2nd, 2014

Week in Review

Liberal Democrats want to take away our guns.  In fact they’d like to repeal the Second Amendment.  For people having guns in the household leads to gun crime.  They like to point to Tucson, Aurora, Virginia Tech and Sandy Hook.  Crimes they say would not have happened if there were no guns.  Take away the guns and you take away these crimes.  And you make our households safer.  For without guns in the home there is no chance for domestic violence.  There will be no women being shot by angry men.  And no children dying if a parent goes off in a fit of anger and shoots them.  For if there are no guns there can be no violence.  The left believes this.  At least they keep telling us this.

For guns make people kill.  And without guns there will be nothing to make people kill.  Luckily for the British they have no guns in their households.  And live a life of peace and serenity the Americans can only dream about (see Domestic violence puts 10,000 at high risk of death or serious injury by Sandra Laville posted 2/26/2014 on the guardian).

More than 10,000 women and children are at high risk of being murdered or seriously injured by current or former partners, according to police assessments obtained by the Guardian…

But the figures obtained are likely to be an underestimate as domestic violence is heavily under-reported and police forces appear to gather and collate the information in several different ways, despite demands for a national protocol on assessing the risk to victims. The snapshot obtained by the Guardian reveals the acute nature of the threat of domestic violence for thousands of women and children…

Last year a coroner in Derbyshire found that police failures had contributed to the deaths of Rachael Slack and her two-year-old son, who were stabbed to death by her estranged partner. Slack had also been assessed as at high risk of homicide, but officers failed to inform her.

Or maybe not.

The obvious response to stop this domestic violence is to take away knives from British households.  For apparently taking away their guns wasn’t enough.  Then they should probably take away rope from the home.  For they may make someone strangle someone.  Blunt instruments, too.  For they can make people kill, too.  And poisons.  Got to remove them from the home.  Of course a man can beat and choke someone with his bare hands.  So you better get those out of the household, too.

Of course, we have crossed over into the ridiculous.  For it’s not these things that are killing women and children.  It’s the people using them.  And when one is not available they will look for another.  So probably the best way to protect a woman and her children is to give that woman a gun.  For if she has a gun it doesn’t matter how big her attacker is or how big the knife is he is threatening her with.  Because all the strength she needs is that required to pull the trigger.  And the big man with the big knife will fall.  Even if he’s 200 pounds heavier.  And a foot and a half taller.  For there is nothing that empowers a woman more than a gun.

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Abortion and Tax Revenue

Posted by PITHOCRATES - January 27th, 2014

Economics 101

(Originally published January 21st, 2013)

The Population Growth Rate fell during the Sixties and Seventies from 19% to 11% due to Birth Control and Abortion

Taxpayers are born.  Yes, immigration helped populate America.  But it was really the children of immigrants that made the country grow.  For a large population having babies will increase the population far more than immigration can.  Why?  Where do immigrants come from?  Babies.  Having babies is like compounding interest.  For babies grow up and have babies of their own.  So babies are good.  Especially for a government that wants to spend money.  Because the more babies we have the more taxpayers we will have.  So high-spending governments need a growing population growth rate.  To provide ever more taxpayers.  Who provide ever more tax revenue.  But sometimes the population growth rate doesn’t always increase.  Sometimes it even falls.  (See Population, Housing Units, Area Measurements, and Density: 1790 to 1990.  The population numbers are from the decennial census numbers.  The population growth rate is the percentage of population growth from one decade to the next.)

Although the population has always grown the population growth rate has not always grown.  In fact, the rate of growth has been falling over time.  Taking steep declines during war.  During the American Civil War the growth rate fell from 36% down to 23% by the time of the next census.  The census before and after World War I saw a decline from 21% to 15%.  The rate plummeted from 16% to 7% before and after the Great Depression.  With so many people out of work and struggling to survive the last thing families needed was another baby to feed.  The rate actually increased during World War II.  But that had more to do with people not having babies during the Great Depression for economic reasons.  After World War II the rate rose to 14%.  Which was still a point less than after World War I.

The following table shows the decrease in population due to war.  (Raw numbers are pulled from United States military casualties of war.)

Note that the most devastating of American wars was the American Civil War.  Where approximately 2% of the population died.  In terms of percentage loss of population the next costliest war was the Revolutionary War.  Then World War II.  Then World War I.  These wars saw millions of men in uniform (except for the Revolutionary War).  Away from their wives for years.  Which put a crimp in baby making.  And the large number of wounded and dead compounded that problem.  Resulting in large dips in the population growth rate during these wars.  Despite the large loss of life in numbers of America’s other wars those losses were all less than 0.10% of the population.  Making the impact on the population growth rate negligible.  One thing these numbers don’t explain, though, is the decline in the population growth rate after 1960.  During the Sixties and the Seventies the growth rate fell from 19% down to 11%.    But it wasn’t the Vietnam War that caused that decline.  So what did?  Birth control.  And abortion.

Couples having only 2 Children can’t Support an Expanding Welfare State but Couples having 3 Children Can

The U.S. approved the sale of the birth control pill in 1960.  Which corresponded with the era of free love and the sexual revolution.  People were having more sex.  While having fewer babies.  Then Roe v. Wade made abortion legal in 1973.  Since then there have been on average about 1.4 million abortions a year.  Dwarfing the 156,250 killed a year in America’s most devastating war.  The American Civil War.  Which has brought the population growth rate to its smallest numbers that weren’t due to war or depression.  Because of that compounding nature of babies (growing up to have babies of their own).  And because babies become taxpayers this has a big impact on future tax revenue.  We can see this by looking at how 100 abortions ripple through the population.

Let’s assume those 100 abortions happen in Year 1 (Y1).  Had these abortions not happened these babies would have grown up and entered the workforce about 20 years later (Y1+20).  And split off into pairs to have babies of their own.  (If each couple has one baby they have a total of 50 babies.  If each couple has two babies they have a total of 100 babies.  Etc.)  Who would grow up and enter the workforce about 20 years later (Y1+40).  And so on.  The above graph adds up all the people for each 20-year period produced by the Y1 babies (children, grandchildren, great grand children, etc.) divided by 100 (those original babies not aborted).

If the Y1 people only have one baby they and their descendants disappear from the world in about 2 centuries.  If they have 2 children the population never grows larger than 4 times the original Y1 people.  Two children to replace two parents.  It’s not until you get to three children that you see an increase in population.  As well as an increase in tax revenue.

Assume each of the people, or taxpayers, at 20-year intervals earn a median income of $50,000.  They pay an effective federal income tax rate of 18%.  In addition to 12.4% for Social Security taxes (both employer and employee).  And 2.9% for Medicare.  Added together they total 33.3%.  This tax rate on total income at each 20-year interval produces the tax revenue in the above graph.  Note the revenue graphs are the same shape as the population graphs.  Showing a direct correlation between tax revenue and the population growth rate.  The tax revenue provided by couples having only one child disappears within two centuries.  Revenue provided by couples having only two children peaks out at $6,660,000.  As couples only have enough children to replace themselves.  Maintaining a constant of 4 taxpayers (2 parents and 2 children) after 80 years.  Showing that couples having 2, 1 or 0 children cannot support an expanding welfare state.  But a couple having 3 children can.  As long as it’s not too big of a welfare state.

You just can’t have an Expanding Welfare State with a Falling Population Growth Rate

The more children a couple has the greater the tax revenue.  For the more children they have the more people enter the workforce and become taxpayers.  If 50 couples have 3 kids each (as do their descendants) they will add $30.4 million in federal tax revenue in one century.  If they have 4 kids they will add $99.9 million in revenue.  If they have 5 kids they will add $264 million.  And if they have 6 kids they will add $599.4 million.

In two centuries these numbers are even more profound.  Couples having 4 kids will provide $3.2 billion in federal tax revenue.  While couples having 5 kids will provide $25.8 billion.  And couples having 6 kids will provide $145.6 billion.  If, that is, 100 pregnancies weren’t aborted 2 centuries earlier.

In the long-term revenue would soar if people simply started having babies again.  For birth control and abortion have greatly reduced the number of babies we’re having.  Causing tax revenue to fall.  We can bring revenue back up by having more babies.  But after some 30 years this baby dearth has pushed us into the flat part of these graphs.  Requiring up to a century or more to make large population gains.  And large gains in tax revenue.   And without these gains in revenue we simply cannot afford an expanding welfare state.

It is rather ironic that two tenets of liberalism clash here.  Liberals believe in both a welfare state.  And free birth control and abortion on demand.  They believe in one thing that requires women to have a lot of babies.  And another that helps women to have as few babies as possible.  Which is another reason liberalism will ultimately fail.  Paradoxes like this.  For you just can’t have an expanding welfare state with a falling population growth rate.  If you try you get trillion dollar deficits.  And $16.4 trillion in accumulated debt.

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Democrat Policies are forcing Young Couples back home with Mom and Dad

Posted by PITHOCRATES - December 28th, 2013

Week in Review

Since the Keynesians took over government we said goodbye to the classical economics that made America the number one economic power in the world.  Free market capitalism.  Based on a strong banking system.  And a sound currency.  People saved as much as they could.  Banks converted their savings into investment capital.  And investors and entrepreneurs built the world’s number one economy.  Because people worked hard and saved for their future.  While raising their families.  In their houses.  Without Mommy and Daddy helping them.  Unlike people do today (see Young Couples Moving Back Home To Save Money For Baby posted 12/22/2013 on CBS Miami).

“Young couples, when they have a child or when they’re planning to have a child, are moving back in with their parents,” said Carmen Wong Ulrich, BabyCenter Financial expert,. “Ten percent of young women are staying, living at home with their parents to save money to have children. This is a new trend.”

Alexis Kort, her husband Josh and their baby Charlotte moved in with Alexis’ parents when they relocated to their hometown.

“You don’t necessarily think about it before you have a kid and then all of a sudden you’re like ‘Wait a second, how do we make this work financially?’,” said Kort…

This trend extends beyond housing. A survey found that nearly 30 percent of new parents get financial assistance from their parents. Ulrich points out that parents who support their children who have children have less time to save for their retirement.

“Supporting grown children is a strain and it can be a strain on your own financial future,” said Ulrich.

You can blame the Democrats for this.  They’re all Keynesians.  And believe in printing (and devaluing) money to keep interest rates artificially low.  So low that you actually lose money now if you put it into a savings account.  So people spend it before it loses its purchasing power.

And Keynesians believe in government spending.  To stimulate the economy.  Which they pay for with taxes.  Lots of taxes.  Between the devaluation of the dollar (which raises prices) and the rising tax bite there’s less money to save.  And with the Keynesians pushing for more consumption and less savings (to stimulate the economy) kids aren’t saving.  They’re spending.  Living in the now.  Without a care in the world about tomorrow.  Which is why kids today are moving back in with their parents.  Because they’d rather pay a cellular bill the size of a car payment than save for their future.

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Military Children (and Children of Single Mothers) suffer Mental Health Issues due to Absent Fathers

Posted by PITHOCRATES - November 30th, 2013

Week in Review

Boys love their fathers.  And it’s tough losing them.  Just listen to some Pink Floyd music.  During the Roger Waters’ period.  Whose concept albums were shaped by his experience growing up without a father who died in World War II.  As the children of Britain grew up in a dearth of fathers following World War II.  As so many of their fathers died in the war.  Waters went on to great success.  But he suffered for his art.  As all great artists do.  Who probably would have preferred to be happy instead of being a great artist.

The bond between child and parent is so strong that the parent doesn’t even have to die to affect the child.  Just periods of separation is enough to do damage (see Military deployments tied to teens’ depression by Kathleen Raven posted 11/29/2013 on Reuters).

Adolescents who experience the deployment of a family member in the U.S. military may face an increased risk of depression, suggests a new study.

Ninth- and eleventh-grade students in California public schools with two or more deployment experiences over the past decade were 56 percent more likely to feel sad or hopeless compared with their non-military-family peers, the researchers found.

The same kids were 34 percent more likely to have suicidal thoughts.

So it would follow the more deployments (i.e., the less time the parent spends with their child) the more likely the increased risk of depression, feelings of hopelessness and suicidal thoughts.  So the more time one parent stays away the less happy and the more frequent mental health issues a child suffers.   With the child no doubt suffering the most should that parent die in a combat zone.  Thus being removed from the child’s life forever.  Sad.  But intuitive.  For most probably didn’t need a study to tell them this.

The same can be said about single mothers.  And their children.  For it is the absence of one parent from their lives that reduces the quality of their lives.  Because that father isn’t there to toss the football around with him after school.  To attend a tea party with her favorite stuffed animals.  To be there to teach them what to do when they lose power during a thunderstorm.  And make them feel safe just by being there.

We take a lot of things Dad does—or did—for granted.  And the more time we spent with him the more we’re able to do the things he did when he’s no longer there to do them.  So the more time we have with Dad the stronger and more able we become.  The less time we have the less strong or able we become.  And if he’s not there at all it is like a child losing him in a military deployment.

The Democrats attack the Republicans and claim they have a war on women.  Because they don’t want to provide free birth control.  Abortion.  Or an expanding welfare state for single mothers.  The left really doesn’t want women to have children.  And if they do they want to help mothers raise their children without a father.  By having the state replace the father.  So women can remain free.  Pursue careers.  And not be condemned to stay-at-home motherhood.  The left does all of these things for women.  For it’s what is best for them.  Without ever considering what’s best for the child.  Two parents.  They will do studies to prove this if they can condemn the military for the effect it has on children.  But when it’s about women enjoying life to the fullest while treating pregnancy as a disease to avoid it’s a different story.  And for those women who become infected with pregnancy?  They don’t need a man in their life.  As long as there is the reassuring embrace of government to comfort her.

The Republicans don’t have a war on women.  But you could say that Democrats have a war on children.  As they always put a woman’s happiness over her child’s happiness.  For a child would rather grow up in a traditional family than be shuffled back and forth from daycare.  Just listen to some Pink Floyd music if you don’t believe that’s true.

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The High Cost of Living in Toronto forces Both Parents to work and forces their Children into Daycare

Posted by PITHOCRATES - November 24th, 2013

Week in Review

Once upon a time we worked so we could raise our families.  Now we find someone to raise our children so we can work (see Daycare in Toronto: ‘Parent summit’ participants tell of vastly different experiences by Marco Chown Oved posted 11/22/2013 on the star).

Diana Tarango is worried. Her 4-year-old daughter is in all-day kindergarten, but because she can’t find before- and after-school care, she can’t go back to work.

Perry Wong and Nalini Nankoo are frustrated. They have been looking for a daycare space for their 2-year-old son and have put down non-refundable deposits to get on the waiting list at a half-dozen daycares. They can’t afford to keep wasting money, and their son still doesn’t have a space.

Cynthia Zhu and Kenny Ji couldn’t be happier. They’ve been in Canada for less than a year and they’ve got both their kids in subsidized daycare spots near their home.

These stories show how ineffective our patchwork daycare system is, said Councillor Shelley Carroll.

“Child care is an issue that affects us all in different ways,” she said. “That’s why we need these meetings and why we need to get people talking across generations, too.”

Parents, grandparents and even childless adults are all affected by the high cost of daycare, said Carroll, and a better system won’t just be better for families with young children, it will be good for the economy as well.

There are 57,000 daycare spaces in Toronto, only enough for 21 per cent of the city’s children under 12. The city subsidizes 24,264 of those spaces, which only covers about 28 per cent of children in low-income families.

Making matters worse, the wait-list for a subsidized spot is more than 18,500 people long…

Tarango, newly arrived from Hungary, looked into putting her younger son into daycare, but can’t believe how much it would cost.

“I was amazed when I asked the price: $1,500 per kid (per month)!” she said. “In Hungary, after one and a half years, everything is free. The daycare even provides food free, too.”

If 21% of the total number of children under 12 equals 57,000 then the total number of children under 12 in Toronto equals 271,429 (57,000/0.21).  The total number of children who need daycare is 75,500 (57,000+18,500).   Subtracting this number from the total number of children under 12 equals 195,929 (271,429-75,500).  So the percentage of children under 12 who are raised in Toronto without daycare equals 72.2% (195,929/271,429).  In other words, the vast majority of children of daycare age DON’T use daycare.  Which is a good thing.  And one would hope that’s because they have a stay-at-home parent raising their child in a loving household.  Instead of dumping these inconvenient pains in the ass at daycare so they can do something more rewarding than parenting.

There may be many reasons why parents need daycare for their children.  Single mothers may need daycare so they can work.  There could be a married parent that prizes a career over raising children and prefers to work instead of being a stay-at-home parent.  But perhaps the greatest reason is that parents can’t raise a family on a single income because of high taxes.  Some of which are going to subsidize daycare at $1,500 per child per month.  Which creates a death spiral for daycare.

Daycare isn’t cheap.  So it takes a lot of tax dollars to subsidize.  The high unmet demand for daycare spaces requires more tax dollars to subsidize.  Which require higher tax rates.  Leaving people with less take-home pay.  Making it more difficult for parents to raise a family on a single income.  Requiring more two-income households.  And a greater demand for daycare.  Requiring more tax dollars.  And higher tax rates.  Leaving families with less take-home pay.  And so on.

The best way to provide for these children?  Tax cuts.  Allowing families to keep more of their take-home pay.  So much that they can raise a family on a single income.  Like they used to do.  Before the welfare state.  That provided cradle-to–grave benefits.  Which, ironically, leaves working people with less.  And forces their children to spend more time growing up with strangers.  And less time with their parents.

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Birth Control and Abortion a factor in Premature Births

Posted by PITHOCRATES - November 24th, 2013

Week in Review

Mitt Romney lost the 2012 election in part because of the Republican ‘war on women’.  Which started when George Stephanopoulos asked Mitt Romney out of the blue if he wanted to take away women’s birth control.  The next thing we knew there were women who said college girls couldn’t afford their birth control and needed the state to buy it for them.  Then this snowballed into Republicans wanted their women barefoot and pregnant.  And were going to turn the hands of the clock back to 1950 for women everywhere if Mitt Romney won the election.  The left warned women that this was the worst thing that could happen to them.  For they knew what women wanted.  Birth control.  And abortion.  So their lives could revolve around their vaginas.  Becoming sexual objects.  To please a lot of different men.  While avoiding the disease of pregnancy.

As it turns out, though, avoiding the disease of pregnancy could have some side effects (see Premature baby steroids ‘may raise risk of ADHD’ by James Gallagher posted 11/22/2013 on BBC News Health).

Steroids given to help premature babies develop may also be slightly increasing the risk of mental health disorders, say researchers…

Being born too soon can lead to long-term health problems and the earlier the birth the greater the problems.

One immediate issue is the baby’s lungs being unprepared to breathe air. Steroids can help accelerate lung development.

However, the study by researchers at Imperial College London and the University of Oulu in Finland showed the drugs may also be affecting the developing brain.

A premature baby has a lot more health risks than one carried to term.  We’re doing things after the birth to help these children.  Is there anything we can do to help before the birth.  Well, we can try to reduce the number of premature babies.  So what exactly causes babies to be born premature?  According to the Mayo Clinic (see Premature birth) there may be a lot of factors including but not limited to the following.  Smoking cigarettes, drinking alcohol or using illicit drugs.  Some infections, particularly of the amniotic fluid and lower genital tract.  Some chronic conditions, such as high blood pressure and diabetes.  Multiple miscarriages or abortions.

There are other risks.  But what’s interesting about these risks is that they grow greater with age.  A married woman having her children in her twenties will have smoked fewer cigarettes, drank less alcohol and used fewer illicit drugs than a woman in her thirties or forties.  She will have had a less active sex life which will reduce the number of infections in her lower genital tract.  She will be less likely to have high blood pressure or diabetes than a woman 10-20 years older than her.  And she may have fewer abortions than a woman who waits until she is in her forties to start her family.  For these reasons women having a baby when they are over 35 have a greater risk of having a premature birth.

Whenever there is another gun death the left says we need new gun control legislation.  To take guns away from law-abiding gun owners.  Even if it saves just one life.  Well, we can have more healthy babies if women choose to get married and start their families while in their twenties.  For it is what’s best for the children.  Instead of trying to have a career first and then start a family later in life.  And perhaps more would if the left wasn’t telling women that a woman should be strong, independent, enjoy her sexuality and use free birth control and abortion to avoid what they call the disease of pregnancy.

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