The Death of Birth — Our Dismal Fertility Rates

The Brookings Institution describes its Opportunity 08 as a bi-partisan project aimed “to help 2008 presidential candidates and the public focus on critical issues facing the nation, presenting policy ideas on a wide array of domestic and foreign policy questions. The project is committed to providing both independent policy solutions and background material on issues of concern to voters.”

As part of this project, Opportunity 08 has published “America’s Economy: Headed for Crisis.” The report does not address developments that have led us to our current fiscal tribulations; instead, it focuses on what must be done to deal with the impending economic difficulties. The paper gives an overview of our growing challenges and proposes reforms that should be taken now to keep a trying situation from developing into a crisis. Every concerned voter should consider these recommendations; only then will politicians give them their due attention.

According to the paper, “One thing is clear: the status quo is not acceptable. The next President will inherit a fiscally lethal combination of changing demographics, rising health care costs, and falling national savings.”

Another way to look at the size of the problem is to total up the government’s explicit liabilities, such as the national debt, and its implicit obligations, such as future Social Security and Medicare payments. According to the Government Accountability Office, all such ‘fiscal exposures’ have a present value of $50 trillion — almost as much as today’s net worth of all household assets and far more than the commonly cited national debt, which is approaching $9 trillion.”

Fifty.

Trillion.

Dollars.

And politicians promise additional, enormous programs.

Perhaps the most telling statement of the report is the following: “No one can say when all this might end up in a crisis, nor what a crisis would look like. Indeed, there might be no crisis at all — just a long, slow erosion in our nation’s standard of living. In either case, it’s a dismal future, and doing nothing now to avoid it would be an act of fiscal and generational irresponsibility.”

You read that right. The best case scenario, to be achieved if we act responsibly and sacrifice now, is a dismal future. Failure to act now would prove far worse, possibly catastrophic.

Read the report. Become aware of the structural faults within the US economy as well as the authors’ proposed solutions. And remember, this was written by a bi-partisan group.

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Fertility rates began a dramatic collapse following the development of female hormonal birth control. The average number of births per woman in many countries reached a peak in the late 1950s, just before the release of “the pill,” which was approved by the US Food and Drug Administration in 1960 and first entered the market as “Enovid” in August of that year. Further developments have included patches, implants, and injections. With development of safer, less expensive, and increasingly accepted abortion, women’s control over fertility became paramount.

A new player, however, may soon enter the field.

Male birth control has been relatively difficult to develop, and many have questioned men’s willingness to help shoulder the burden. Recent surveys, however, indicate that numerous men are more than willing to share this responsibility. Many are also quite concerned over becoming fathers when they don’t want to. According to Dr. Bill Bremner, chair and director, respectively, of the University of Washington Department of Medicine and the Male Contraception Research Center, “up to 80 percent of men surveyed worldwide claimed they would use a new male contraceptive.”

On September 27 and 28, 2007, Seattle, Washington, hosted the “Future of Male Contraception” conference. Sponsors of the gathering included the National Institute of Child Health and Human Development; the National Institutes of Health, DHHS; the University of Washington, Seattle; CONRAD; and the World Health Organization. One message in particular underlay talks on this developing bio-technology — male birth control, beyond condoms and vasectomies, may soon be widely available.

Women have gained far greater control over their lives through the use of birth control; men may soon enjoy a similar increase in control over their own lives. The National Marriage Project, based at the State University of New Jersey, Rutgers, has for years released annual reports, “The State of Our Unions.” In their 2002 publication, “Why Men Won’t Commit,” the authors told of many men choosing never to marry. Among the most common reasons for avoiding marriage was that “They want to avoid divorce and its financial risks.” To this might well be added a decision to forego fatherhood in order to avoid losing contact with children after the breakdown of a relationship with a woman. Many a man has come to fear that if things go bad with his children’s mother, the mother may prevent contact between him and his children. While men must pay child support (really household support) under penalty of imprisonment, women who deny contact between fathers and their children often face no consequences.

When male birth control becomes available, and especially after it has had time for bugs to be worked out, it’s likely that many men will avail themselves of the opportunity to have sex while avoiding the possible, devastating loss of contact with children whom they otherwise would have sired.

In any case, the whole purpose of birth control is to reduce the number of children. It will be interesting to see if male birth control has an impact on total fertility rates comparable to that of female birth control. A negligible effect is unlikely.

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On September 17, 2007, Hillary Clinton announced her proposal to provide health insurance for every American.

Clinton is not alone in forwarding such a proposition. Democrats John Edwards and Barack Obama had already fielded similar initiatives. In addition, universal health care is mandated by states such as Massachusetts, while California’s Republican governor, Arnold Schwarzenegger, supports a similar idea. Republican presidential candidates, on the other hand, tend to focus on changes in the tax code, to allow individuals greater latitude in purchasing health insurance. It would be hard for a presidential contender not to address the problem of the medically uninsured. There is, however, a problem with plans to create any new transfer program…

The cost.

Clinton claims that $110 billion per year will cover the 47 million currently uninsured. That averages about $2340 per year or roughly $200 per month per person. A quick glance at the cost of insurance, when one is paying with an employer, will show this to be an optimistic estimate of the costs. My wife and I and her employer currently pay significantly more than this to cover us through her work.

But let’s give Clinton the benefit of the doubt and suppose that she can figure out a way to cover the uninsured with such atypical government efficiency. That still adds up, in just 10 years, to an additional $1.1 trillion – for a nation that is already bankrupt.

Unfortunately for Clinton and the others who are proposing such additional expenditures by the federal government, Alan Greenspan, former chairman of the Federal Reserve, has a new book, “The Age of Turbulence: Adventures in a New World.” As can be seen in this (unfortunately poorly transcribed) interview of September 17, 2007, Greenspan makes it clear that the biggest problem facing the US economy is our extant commitment to transfer programs, especially Medicare. To get an idea of how large the Medicare crisis is, consider the fact that the program’s budgetary insufficiencies will exceed those of Social Security. And according to the Treasury Department, whose general assessment is shared by many economists, Social Security faces a $13.6 trillion shortfall.

According to Greenspan, “we either are going to have to raise taxes very sharply or cut benefits by half.” He goes on to say that prudent policy “would be to adjust the longer-term now, not when it becomes a serious problem for people who have already retired and are told after the fact that they will not be getting the real Medicare that they expected.” We can address this problem in the near term — before we reach a crisis point — by raising taxes (a solution that Republicans generally loathe) and by reducing benefits (a solution anathema to Democrats). And that is just to address our current shortages, without additional entitlements.

A sad irony is that those in greatest need are those who will be hurt the most by the unfulfillable promises. These are the people whose votes are being purchased through such false hopes. People need to be more self-reliant, to care for their own health and to rely on each other rather than the government, which is already drowning in liabilities. A bankrupt US won’t be bailed out, because every other developed nation on earth faces financial crises as a result of collapsed fertility rates — fewer taxpaying workers to support the coming tsunami of retiring baby boomers.

Another irony is the fact that higher taxes, which will be necessary to cover even reduced costs of current programs, will mean that young workers will be less able to afford children. A dramatic increase in taxes may well send the nation into a feedback loop, in which higher taxes lead to lower fertility rates which lead to higher taxes and even lower fertility rates. The loop may become a spiral — a death spiral — and large, new, expensive government programs will only exacerbate the problem.

The idea of universal health insurance is certainly attractive. It would be wonderful for our society to provide such protection. Unfortunately, we are already broke. The longer we wait to raise taxes and reduce benefits, the harder the adjustment will be.

In the words of Alan Greenspan, “I think it’s unethical and immoral for a government when confronted with these types of events not to take action. What do we elect people for?”

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Unless you’ve been living alone in a remote cave for the last few years, you’ve likely heard rumblings about the worldwide collapse of fertility rates. While many politicians fail (fear?) to speak of the growing fiscal crises that this phenomenon is causing, an increasing number of economists and demographers are addressing the issue. With dramatically reduced rates of childbearing, particularly in the developed world, societies are aging at a dangerous rate. In some nations, population has started to fall.

Though a drop in human population might well be a blessing for an ecologically overtaxed world, governments have done little to prepare for the aging of their countries. As a result, programs — such as Social Security, Medicare, and Medicaid — are approaching bankruptcy. Far higher taxes and reduced benefits will be unavoidable. In addition, increased immigration is necessary to provide taxpayers to support the elderly, and cultural clashes are a growing problem.

This blog will keep readers abreast of the building social and economic problems that are resulting from this recent development. It will also offer proposals for dealing with these issues.

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