This blog is intended to go along with Population: An Introduction to Concepts and Issues, by John R. Weeks, published by Cengage Learning. The latest edition is the 12th (it came out in 2015), but this blog is meant to complement any edition of the book by showing the way in which demographic issues are regularly in the news.

If you are a user of my textbook and would like to suggest a blog post idea, please email me at: john.weeks@sdsu.edu

Friday, December 15, 2017

The Rich Keep Getting Richer

The latest version of the World Inequality Report shows the unmistakable fact that the rich just keep getting richer. This is true not just in the U.S., but in most of the world. The Guardian has a summary of findings.
The richest 0.1% of the world’s population have increased their combined wealth by as much as the poorest 50% – or 3.8 billion people – since 1980, according to a report detailing the widening gap between the very rich and poor.
The World Inequality Report, published on Thursday by French economist Thomas Piketty, warned that inequality had ballooned to “extreme levels” in some countries and said the problem would only get worse unless governments took coordinated action to increase taxes and prevent tax avoidance.
As I noted yesterday, the general consensus is that the tax bill that Congress is now considering will contribute to ever more inequality in the U.S., pushing the global trend in income and wealth inequality, as the graph below illustrates.


The economists said wealth inequality had become “extreme” in Russia and the US. The US’s richest 1% accounted for 39% of the nation’s wealth in 2014 [the latest year available], up from 22% in 1980. The researchers noted that “most of that increase in inequality was due to the rise of the top 0.1% wealth owners”.
While inequality was high in north America and Europe, the researchers warned that the problem was even more acute in Africa, Brazil and the Middle East, where they said “inequality has remained relatively stable at extremely high levels in recent decades”.
“The top 10% receives about 55% of total income in Brazil and sub-Saharan Africa, and in the Middle East, the top 10% income share is typically over 60%,” the report said. “These three regions never went through the postwar egalitarian regime and have always been at the world’s high-inequality frontier.”
The current tax bill shows us that there is not yet a movement afoot to worry about much of anybody except the very wealthy. This is not a good thing.

Thursday, December 14, 2017

Paul Ryan Thinks That Raising the Birthrate is What the US Economy Needs

It is no secret that the tax plan about to be voted on by Congress will massively increase the federal debt, despite the Republican Party's historical aversion to higher national debt. It also seems well established that in a few years Congress will push to lower the debt by slashing government benefits such as Medicare and Social Security. If we are to listen to Speaker of the House Paul Ryan, this could be avoided if only Americans had more babies. Here is the report of his press conference today, courtesy of TheHill:
“This is going to be the new economic challenge for America: people. Baby boomers are retiring — I did my part, but we need to have higher birth rates in this country,” Ryan, a father of three, told reporters as he riffed on how Republicans will tackle entitlement and welfare reform in 2018. “Baby boomers are retiring and we have fewer people following them in the workforce.
The comment came at least partly in response to the news last summer that the birth rate had dropped a bit in the U.S., as I noted at the time. Of course, a big problem with the idea that babies will bail out the tax reform is that the tax plan will in fact make it harder to have kids, as elitedaily.com reported today:
As having and raising children becomes increasingly more expensive in the United States, year over year, many of Ryan's legislative proposals would compound that difficulty by slashing social programs and raising taxes on average Americans. So, even aside from the fact that women's bodies are not factories to be used to pump out productive workers and taxpayers, Ryan is actually de-incentivizing what he says is one of the key factors to keeping the American economy afloat. 
During his Dec. 14 press conference, Ryan was discussing entitlement programs like Social Security when he told reporters that the American economy will only function properly if the nation's birth rate increases.
The reality is that if Congress passes the current tax reform bill that is being considered, the economy is very unlikely to get better. The rich will get richer, but the economy will not get better. That scenario is not going to be affected by the birth rate. On the other hand, passage of the bill may push the birth rate even lower.