22 February 2010

Europe Doomed by Debt and Demographics

The threat to the euro bloc ultimately stems from an overcommitted welfare state. Greece's situation is so difficult because a low birth rate and rapidly graying population automatically increase old-age assistance even as the government tries to cut its spending. At issue is the viability of its present welfare state. _RCP
Greece's demographic collapse will not allow Greece to pay for its corrupt welfare statism. Greece is a preview of coming Euro-attractions.
Concerns that Greece and other struggling European nations may not be able to repay their debts are focusing investor attention on another big worry: Economies across the Continent have used complex financial transactions—sometimes in secret—to hide the true size of their debts and deficits. _WSJ
Skyrocketing debt combined with rapidly aging and imploding populations. Not the best combination one might have dreamed up. Europe should have provided for her retirement ahead of time.
Demographics crises may be the ultimate determinant of the fate of nations and the easiest to predict. In most cases, the population shift has already occured that dooms a country to slow or sudden decline. __BI
Nations with the highest average IQ are shrinking, due to low birthrates. Nations with the lowest average IQ are exploding, due to high birthrates. This trend is dysgenic, leading to a worldwide idiocracy.
The Russians realize that they're in a race against the clock before their demographics kill them as a country, and so they want to make sure that they've got as wide of a buffer as possible. As long as Europe is at each others throats, even if its just with bureaucratic paper, the Russians are going to take advantage of that to strengthen their western perimeter and push the frontier into Europe as far as they can. They know in 20 or 30 years they're not going to be able to do much, so they want to buy as much time and space as possible.... _StratforPredictions_BI
Russia will take advantage of European turmoil as long as it can. But eventually Russia's own demographic crisis of high deaths and low births will do Russia in.
"First, China’s current economic model is not sustainable. That model favors employment over all other concerns, and can only be maintained by running on thin margins."
"Second, the Chinese model is only possible so long as Western populations continue to consume Chinese goods in increasing volumes. European demographics alone will make that impossible in the next decade."
"Third, the Chinese model requires cheap labor as well as cheap capital to produce cheap goods. The bottom has fallen out of the Chinese birthrate; by 2020 the average Chinese will be nearly as old as the average American, but will have achieved nowhere near the level of education to add as much value. The result will be a labor shortage in both qualitative and quantitative terms."
"Finally, internal tensions will break the current system. More than 1 billion Chinese live in households whose income is below $2,000 a year (with 600 million below $1,000 a year). The government knows this and is trying to shift resources to the vast interior comprising the bulk of China. But this region is so populous and so poor — and so vulnerable to minor shifts in China’s economic fortunes — that China simply lacks the resources to cope." _Stratfor:China Doom_BI
China has not taken the time to firm up the foundations of its hyperkinetic growth. Outside observors see only the high numbers, not the underlying corruption and crumbling of the foundational sandworks.

The hypothetical decline of China is most important as it impacts the overall instability and unpredictability of world affairs over the next ten years. Such a decline could force the Chinese government to attempt some audacious international expansions, not altogether of a peaceful variety. The reverberations from such international adventuring would be felt far and wide, and make the US' interventions in Iraq and Afghanistan look like pastoral picnics.

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OpenID snakeoilbaron said...

It would be a productive time for some tribalists with high feritity, horse breeding/riding skills and some start-up ammo to start pillaging. Hopefully the guy who does it is more Genghis Khan than "prophet" Moe.

Monday, 22 February, 2010  
Blogger Hell_Is_Like_Newark said...

Throwing a hypothesis out there that the demographic issue might be self-correcting:

In the past, people had larger families because children provided an economic benefit: Labor for the farm, child labor in factories, source of income and support for parents as they grow old. The first two were eliminated with the rise of the modern technological / industrial economy.

Item #3 was negated by the rise of the social welfare state. The welfare state is going to collapse on a global scale. Soon there will be no meaningful Social Security / Medicare type plans. People who are childless and not very wealthy are going to have a very rough time in their 'golden years'.

Suddenly, having children will again provide a long term benefit. Also, as the world becomes increasingly unstable and dangerous, feminism and other social constructs of the left also become unsustainable. This would also create a trend to not abort children or wait until you are 40 to try to have them.

Again.. just a hypothesis...

Tuesday, 23 February, 2010  
Blogger al fin said...

Baron: Riding horses limits your pillaging to short range and local. A better strategy would be for the tribe to operate a small helicopter factory and biomass to aviation fuel facility to allow for longer range, more productive pillage all around.

HILN: Right. Many demographic trends are cyclic in nature. The leftist lethal memes you allude to tend to re-appear time and again in history. But overall, human nature is to do what is necessary to survive.

Tuesday, 23 February, 2010  
OpenID snakeoilbaron said...

There is a small company (one of many similar ones I don't doubt) which is making tiny, single person helicopters with the intention of selling them to ranchers, park rangers and others who need to manage large areas of land. Maybe they could start a branch in Mongolia. Free AK-47s for all bulk orders.

Get a reputation going and you don't even have to fight most people - just offer to stay away in exchange for tribute.

There are a lot of factors which could influence the age at which people have kids and the numbers they have. It could be that a hyper rich class turn out to develop high fertility compared with the merely upper-upper-class.

Tuesday, 23 February, 2010  
Blogger Painlord2k said...

Al Fin could dedicate a post to the demographies of North Africa, the M.E., India, Pakistan, South America, Mexico, Africa Sub-Sahara.

North Africa have is fertility falling to replacement or lower (Tunisia is lower than replacement). Their population is increasing due to the past bulge of births, but this will end in few years. Urbanization of the population will make sure their birth rates will stay low, because you can not form a family if you have not a home (and people in urban settings will not be able to afford homes in their 20s or early 30s, not if they are not able to have very productive jobs) and out-of-the-wedlock children are unacceptable in Muslim countries. Crammed spaces in the house of the parents of the husband will lead to lower birthrates. I don't foresee working class in North Africa being able to afford 200 m2 apartments or houses to have many children or host their married children.

The same is true for Iran. Five years from now Iran Islamic Republic is over or neutered by lack of money and young (that have other ideas than die for Allah). They could have a few A-Bombs, but if they use them, they will be put out of business by the US, France, UK or Russia if Israel don't do it before. Russia know that a few A-Bomb don't substitute for a good economy.

The Gulf states are not far back from Iran: only a decade or two. But they lack the human capital of Iran. So as soon as your prediction of bio-fuels become true (or of good rechrgeable batteries) and a ceiling is in place for the price of oil, their fate is signed. Without oil they have near nothing to sell and without nothing to sell they have nothing to buy. Without oil they were a joke before, without oil they will become a joke after.
No money, no islamic revolution, no da'wa, no new mosques controlled from Riad and Mekka or Teheran. No money for costly toys like F-14, M1 tanks and no money to buy the submission of their populations and pay for their praetorians. People without money will not be able to sustain themselves in a desert. The Saudi Arabia population is too large to be fed by the local food and without oil they can not pay for imported food. So their fertility will continue to fall like a brick.
It went from 7 to 3 in 40 years and the fertility is computed over the means of the children every woman have from 16 to 50, so they are counting the fertility of women that stopped to have children 15-20 years ago.

The only places where fertility is not falling fast are Yemen (too poor, not enough urbanization of the population), Pakistan, Afghanistan and Sub-Sahara Africa (but appear that governments are trying to push for less fertility because the actual rate can only produce war, famine and instability - and governments want stability for themselves).
Nigeria is the biggest problem. But it is an oil export, so if oil stop to be a big revenue, money will stop to flow and people will be poorer and less fertile.

In great part, the demographic explosion of these countries is due to the oil bough from the West that pay for the food and other stuff produced by the West. Take oil out of the equation and they need to find productive jobs to feed themselves. And if they are forced to work long hours they will be less interested in having many babies.

Saturday, 27 February, 2010  

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