Japan and China Look Old Age in the Eye

Japan's relatively stable stagnation will continue for another 5-10 years before the combination of bad demographics and excessive debt causes the country to collapse into a crisis from which it may never recover. Its long history of domestic consensus and tranquility notwithstanding, Japan may well become a failed state. _Benzinga

The Land of the Setting SunJapan's fertility rate has been below replacement levels for over 30 years. Japan is aging very quickly. Once a population ages to the point that a relatively few fertile females remain, the point of no return for that population may have passed.

Fewer people means fewer customers to sell to. It means fewer innovators pushing at the boundaries of current technology. And in the modern welfare state, it means fewer people to pay for the pensions and health care needs of the elderly.

Regrettably, John Maynard Keynes was right. Without a continually growing population, the capitalist economic system starts to fall apart.

Of course, Japan's demographic woes are not just about shrinkage. It actually gets worse. Populations are not just a number; the composition of the population matters too. Japan's is changing, growing older at an alarming rate... _Benzinga

As you can see, sometime after 1975, Japan's total fertility rate dropped below replacement. Too many things would have to change in today's Japanese culture for that trend to reverse itself meaningfully. As Japan's population declines, Japanese industry will have to rely more and more upon export markets, which will put it in direct competition with a soon-to-be-aging China.

Japan’s population of 128 million now accounts for 2% of the world population, but with the global population on the rise the ratio is expected to reach 1% around the year 2050, according to another government survey. This has an array of implications, including forcing Japanese companies—from food makers to insurance companies—to go outside Japan to seek a bigger slice of the market share through mergers and acquisitions. _WSJ

With it's "one-child policy", China's fertility is similar to that of Japan. Although China's population is still growing as a result of sheer momentum, the nation's people are aging rapidly, with all the dire economic consequences that Japan is already beginning to experience.

China has reached a turning point. Demographic conditions are becoming unfavorable as the "baby bust" generation comes of age - entering and progressing through the working ages.

Currently, the "baby bust" is pushing down the number of people in their early 20s. In another 10 years, the number of people in the 20s and early 30s will be in decline. With each passing year, a larger share of the labor force, too, will be in decline.

The aging population is growing and will continue to grow very rapidly. The speed of aging will depend primarily on whether the fertility rate recovers from its currently low level or declines further as has been the case in South Korea and Japan. If China's total fertility rate begins to recover from its current level of about 1.5 to 1.6 births per woman, about 34 percent of its population will be 60 years or older in 2050. But if the total fertility rate declines to lower levels, about 39 percent of its population will be 60 years or older by then.

...The speed of aging will depend primarily on whether the fertility rate recovers from its currently low level or declines further as has been the case in South Korea and Japan. If China's total fertility rate begins to recover from its current level of about 1.5 to 1.6 births per woman, about 34 percent of its population will be 60 years or older in 2050. But if the total fertility rate declines to lower levels, about 39 percent of its population will be 60 years or older by then. _Xinhuanet

Japan was already rich when its people began growing old. Unfortunately, the bulk of China's vast population -- already beginning to age -- is still quite poor. Even worse, with China's one-child policy, individual Chinese tend to have no brothers, sisters, cousins, aunts, or uncles. The potential for alienation without family is quite severe. And with a growing imbalance of males to females in the population, family life in China is apt to grow somewhat more rare. What will all these excess males -- no relation to each other -- do with all their spare time?

Across both the province and China as a whole, the disaffected are lashing out. “There is a growing sense of a country in danger of pulling itself apart at the seams,” as Hong Kong journalist Will Clem put it yesterday. Poor migrants in Guangdong have yet to start a full-scale insurrection and it’s too early to speak of “blood laptops” and “conflict handbags,” but these days they are in the mood to fight. _Forbes_Gordon_Chang

China's government is likely to turn to nationalistic saber-rattling and border wars, if for no other reason than to secure natural resources and to give the population a reason to rally around the flag. Excess young men, of course, can be given uniforms, and something to do.

US Assistance to Devastated Japan Impressive, Timely

Japan's government has come under intense criticism for its slow and paltry response to the devastating earthquake and tsunami in the Northeast. The US Navy, on the other hand, has been "Johnny on the spot" with water, food, clothing, bedding, and other emergency first-response relief efforts.

When United States Navy helicopters swept down on the school in a ruined Japanese village, survivors first looked hesitantly from the windows. Then they rushed out, helping unload food, water and clothes. They clasped hands with the Americans. Some embraced them.

...Soon after the devastating earthquake and tsunami struck Japan, the United States military began what it calls Operation Tomodachi (Friend), one of its largest relief efforts in recent years. At present, about 20 American ships have massed off Japan’s northeastern coast, including the Ronald Reagan, a nuclear-powered carrier whose helicopters are busily ferrying supplies to survivors.

That relief is getting through to sometimes difficult-to-reach coastal areas devastated by the March 11 double disaster. They are also the latest showcase in the Pentagon’s efforts to use its forces to win good will for the United States abroad, a strategy that it used successfully in Indonesia after the 2004 tsunami there.

...Much of what the Americans have handed out are goods taken from their own ships: extra food and blankets, and even the sailors’ own clothes.

There were stuffed toys for children, too.

To alleviate food shortages in the shelters, the Ronald Reagan sent 77,000 frozen hot dogs to a Japanese warship, which boiled them and gave them out. _NYTimes

Across the US, civilian efforts to help the victims of Japan's natural disasters have also been significant. Donations of medicines, foods, cash, and other needed goods have been flowing out from a typically generous American populace.

China's relief efforts have been rather limited in comparison, and funneled through government channels. Given China's history of poisoned food exports, the Japanese should be cautious about testing all aid from China before consuming it.

The competence and capability of the US military to assist a distressed civilian populace is considerable. The US military spends a great deal of time and money training its personnel, and providing them with quality tools to do their jobs.

Most American servicemen would far prefer to go on humanitarian missions than on wartime missions -- particularly in situations such as Japan's recent disasters.

Of course, Japan received significant aid from the UK, Australia, New Zealand, Canada, and several European countries. The impulse to assist the suffering and make the world a better place is widespread among European peoples, and has been so for centuries -- since the industrial revolution and the coming of affluence. It is just that almost all of the outside aid sent to Japan had to be funneled through the Japanese government bureaucracy -- which can be unwieldy, like most civilian government bureaucracies.

The US military, on the other hand, was able to provide the necessities on a large scale at the point of need, in a timely manner. That should receive far more comment than it has gotten.

An Interesting Look at Japanese Culture via Blood Type

Source: Phlebotomist