Prosperity and birth rates
I write first to commend my fellow University of Minnesota economics classmate Perng Fai-nan (彭淮南) for his governance of the central bank these past years, and especially for the bank’s recent decision to go against the rising tide at the US Federal Reserve Bank (and others, including Hong Kong) of raising interest rates in the face of continuing economic stagnation.
Taiwan fared relatively well during the financial crisis of 2008 and thereafter — much better than the US or Europe — and much of the credit belongs to the management of the central bank. Lowering its interbank rates at this time is the right decision.
Second, I want to respond to the editorial about what the Taipei Times called a “disconcertingly low birth rate” (Editorial, Dec. 18, page 8).
Taiwan’s low-birth rate might harm certain businesses and real-estate interests by putting upward pressure on wages and less pressure on housing costs.
However, for society as a whole, these changes are among the many benefits that derive from a lower birth rate. Yes, it will also cost more to recruit soldiers for the nation’s defense needs, but this is also a matter of justice for Taiwanese, especially for those in the armed forces.
Supporters of increased birth rates argue from covert self-interest. National security is often raised in political arguments when other reasons fail: It should be regarded as suspect when raised regarding birth rates. The national security arguments fail for many reasons, but there is not space here for details.
Consider just two things: First, cases in recent history where coalitions with much larger populations have not been able to prevail against less populous places such as in Vietnam, Afghanistan or Israel; and second, there is no possibility of competing with China on population.
This leaves the foremost argument that is proposed for our concern: That low birth rates mean aging populations. Who, it is asked, is going to support us in old age if there are fewer workers? On the face of it, this argument seems sensible, but it does not fare well under scrutiny.
The world has limited resources. Seven or more billion people cannot all have the material lives we each aspire to. A lower birth rate leaves more resources per person, higher wages and more prosperity.
Technical progress will continue to make some work redundant, and most work less taxing and more productive. The market for labor will change and adapt as conditions change.
Growing populations re the real problem, not aging populations. To maintain prosperity, Taiwan, as with the rest of the world, must limit population growth.
As for national security, prosperity is strength.
Robert Dildine
Yilan County
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