Sat, Oct 14, 2017 - Page 8 News List

More kids require higher incomes

By Yaung Chih-liang 楊志良

Taiwan’s low birth rate is a big problem. The fertility rate continues to drop and has reached a low in the past 10 years: Every woman is now giving birth to an average of one child during her lifetime. In one generation’s time, Taiwan’s population will have halved.

Of the two main political parties, the Democratic Progressive Party has said that it wants to build an independent nation, but how do you build a nation without a population?

The Chinese Nationalist Party (KMT), on the other hand, has said that it wants to get back in power, but again, what is the use of taking power without a population?

Over the past 20 years, the government has regularly made noise about the low fertility rate being a national security issue, but it is all for show. Officials will set up a committee or an office, but there will be no policy goal or measures, not to mention a budget.

The government often makes policy statements that never amount to anything — fight for the economy, build housing, raise the salaries for young people, reduce carbon dioxide emissions, the New Southbound Policy and so on — and the public does not even raise an eyebrow anymore, but the nation is growing increasingly uneasy.

The low fertility rate cannot be blamed only on the young generation’s laziness or lack of responsibility; it is part of the culture of the new generation.

The culture of the new generation has always been more advanced in the countries of northern Europe, but women there still have an average of two children and in Japan they have 1.4.

There is a perfectly simple reason behind the low fertility rate: People do not marry anymore.

There is a strong correlation between having children and marriage in Taiwan, but almost 40 percent of Taiwanese women are still unmarried by the time they turn 40 and the same is true for men. Of course this will have an impact on the fertility rate.

Why do people not marry? There are many answers to this question, but the most important is that they do not own a home, while the prospective mother-in-law wonders how someone is going to marry her daughter if they do not have a home. Where are they going to raise children?

Why do they not buy a home? Because past governments have allowed businesses to drive up housing prices.

When people born in the 1940s and 1950s entered the job market, they could still buy an apartment in Taipei with five or six years’ salary, but now that takes 16 or 17 yearly salaries.

If I buy a house at NT$100,000 per 3.31m2, I will sell that for NT$200,000 two years later. On paper, wealth has been created, but in reality nothing has been added. Instead, the value of work has depreciated, as you have to work more, or sell more beef noodles or plant more rice, to buy an apartment.

In addition, the result of economic growth goes into the pockets of a few corporations while salaries have dropped to the same level as 15 or 16 years ago, making it even more difficult to marry and have children.

The first step to raise the fertility rate is to create access to money. Where is this money to come from?

Earmarked money should be used for its purpose. A good example is the National Health Insurance expenditure, which is something that everyone enjoys and is easy to monitor.

For example, the asset tax — housing and land tax — could be raised from 0.1 percent to 0.5 percent, especially for second homes. In the US and Japan it is 1 percent.

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