China's unforseen problem is the near future

and this could be a costly one too.

The issue I am talking about of course is population. And no I am not talking about the over population problem, that is way old. since I couldnt find a suitable forum for this, I will post it here.

Of course I presume we all know the cause of China's over population was during the cultural revolution, the communist party encourages familes to make more babies to populate the country. And we all know how that turned out. And after Deng took over, they made the one child policy. And this is the problem.

In present day around 7.5% of the Chinese population is over 65, but in twenty or so years, that number will increase to nearly 30%. that will be a never before seen figure in human history.

but this will also spells trouble for the Chinese economy, because that means China will need to rely upon an ever diminishing work force to supports its large population. Accroding to bbc, when that time comes one ellderly can only be supported by 3 working Chinese. This will push tremendous pressure on the Chinese economy just to support its population.

and they can pretty much can forget about that aircraft carrier too (joking)

edit: forgot to put "in" in the title, embarrassing =(

That's a problem for democratic welfare states, where the elderly voting population can hold national policy hostage and crash any reform attempts.

It's not as big of a problem for communist dictatorships that doesn't offer much in terms of social welfare to begin with. Most forms of government have its advantages and distadvantages. If you're a poor country in need of economic reforms and major infrastructure construction that involves taking land by eminent domain, it's much, much easier to do under a dictatorship -- at the price of your freedom and property rights.

Here's an example of Chinese elderly welfare:


Notice the funding comes from a mix of public donations, loca/city government subsidies, and lottery ticket sales. The central government is not footing the bill here. The next-generation young workers are not subject to "forced charity" through taxes.

As for 30% elderly population being "never before seen figure in human history", I'd suggest checking Japan's projected demographics. If the PRC wanted more babies, they can simply lift the birth restrictions ("one child policy").

The current situation in PRC is likely to be the result of a mix of intentional and unintentional consequences. The urban areas are developign much faster and subject to both governemnt-imposed birth restriction, as well as naturally-occuring reduction in birth rate through rising income and education level in ubran environment.

This reduced brith rate results in decline of labor pool, which is remedied by importing labor from the rural areas with lower education and higher birth rate. The under-educated rural migrant workers are then tossed into the factories that made China a new manufacturing power.

The overall birth rate is kept at a slow overall decline. In time India will surpass China as the most populous nation, and the Chinese population will peak at ~1.5 billion and go into gradual decline, as the country industrializes and technology/automation reduce the need for human workers.

adeptitus said:

If the PRC wanted more babies, they can simply lift the birth restrictions.

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What will only happen at least after the gigantic elderly generation has pass away. (btw, those period, funeral related services will definitely get some big bucks out of people, a friend of mine is already talking about buying lands in china and turn them into cemetaries bfore that begins =p, sucko. but talk about needing to bury more than half a billion people )

If the Chinese lift the birth restriction before that group passes away, they will leave China with a gigantic underage population, and a gigantic elderly population, and a tiny work class thats on the verge of collapsing

green beret said:

What will only happen at least after the gigantic elderly generation has pass away. (btw, those period, funeral related services will definitely get some big bucks out of people, a friend of mine is already talking about buying lands in china and turn them into cemetaries bfore that begins =p, sucko. but talk about needing to bury more than half a billion people )

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That's actually a very good idea. If you look at the way that cemetaries and funeral servics are run in the US via Rose Hills, the business model is rarely found elsewhere and I think it'd be very attractive to many people.

The only concern I have with that business in China is the land ownership laws. If the local government decide that the land is better used for economic development than a cemetary, they might take the land and pay you a small sum for it.

I can say from personal experience that the funderal business in Taiwan is HUGE. We've recently purchased 2 burial lots for my grandparents (for future use) from a converted golf course. The investor bought out the golf course and turned it into a cemetary with ocean view. The cost of the 2 plots was more than 2 new cars, plus you have pay an annual maintenance fee. Fortunately my grandparents (on mom's side) had 2 sons and 5 daughters, plus numerous grandchildren who are alread working. So the cost was affordable with everyone chipping in.

yup, and there is a whole chain of businesses tied to the whole funeral business. You need people to make headstones, you need people to manage the cemetary, you need people to deal with all those ceremonies. I can see someone (or maybe me and my friend) making quite a lot of money in the near future.

As for the local leader, there is nothing a few thousand dollars, maybe a nice dinner, some good French wine, cant do with them.


Oh man, we are horrible, horrible people!!! We are talking about sucking money out of people's dead family member.

Sorry to burst your bubble. In cities, cremation is the norm. Unless you're someone really special, chances are you won't get any land space, just some shelf space in a large building. We don't waste space for the dead that could be useful for the living.

On population laws: one-child policy is only for Han ethnicity. The ethnic minorities can have more than one child. Having more than one child if you're Han doesn't necessarily mean bad things will happen to you. It just means you will foot the bill for expenses that the government would otherwise pay for, and also pay a fine. Some people see the payment not really as a fine, but as a tax. New policy states that if the first child is female, a Han couple can have a second child if they are college educated and they were both without siblings.

Western "studies" can only think of the worst when it comes to China. Like how they predict the one-child policy in favor of boys will breed a generation of violent men that will wage war across the world. China has had bachelor societies before with no violent periods that erupted as a result. The US forced a bachelor life on Chinese coolies who built the railroads. Chinese women were outlawed because Americans didn't want to see them breed. San Francisco's Chinatown was virtually all men and the only violence there was from the people lynching the Chinese. For a country restricting with an oppressive hand on how many babies are born, how come the population in China still grows at ten million a year? A one-child policy for a generation now and the poplation is still growing? That shouldn't be happening. The population should be dropping. When I bring this point up, for some strange reason there's always someone that gets upset by it. Which says they want the worst case scenario. What does that say about the motives behind these "studies?"

RedMercury said:

Sorry to burst your bubble. In cities, cremation is the norm. Unless you're someone really special, chances are you won't get any land space, just some shelf space in a large building. We don't waste space for the dead that could be useful for the living.

On population laws: one-child policy is only for Han ethnicity. The ethnic minorities can have more than one child. Having more than one child if you're Han doesn't necessarily mean bad things will happen to you. It just means you will foot the bill for expenses that the government would otherwise pay for, and also pay a fine. Some people see the payment not really as a fine, but as a tax. New policy states that if the first child is female, a Han couple can have a second child if they are college educated and they were both without siblings.

Click to expand...

I think its a dumb policy to begin with. All of a sudden, non Han ethnicities are booming, and you wonder where all these ethnicities are suddenly coming from.

The original post was about the future demographic problem facing China with high % of elderly population.

In democratic welfare-states, the central government is often held hostage by the elderly voting population to dole out unsustainable amounts in social security & health care benefits, while the younger, working generation is pressured with higher income tax.

From what I've seen, in China the central government doesn't dole out much for welfare programs, except small amounts of seed money. This opinion is based on what I've read on People's Daily. For the majority of Chinese, I think they know that they have to take care of themselves in their old age, so they have a high savings rate. I'll point to this article as an example:



China saving too much money: Bush
From correspondents in Washington

November 02, 2006 06:45am
Article from: Agence France-Presse

US President George W. Bush said today that he hoped China would transform from a country where people "hoard the money they have" into one where people buy large amounts of US products.

In an interview with conservative radio talk show host Rush Limbaugh, Mr Bush said China should become "a society in which there's consumers. Because now they're a society of too many savers".

"And the reason why they're saving so much money is because there's not a pension plan or a legitimate health care system. And so, therefore, people hoard the money they have in anticipating a bad day," said the president.

"If we can encourage China to become a country of consumers, you can imagine what it would mean for US producers and manufacturers to have access to that market," he said.

Mr Bush also said that the United States must remain present in East Asia because "we serve as a way to make sure that there's stability. And stability in the Far East, obviously, is essential for the United States in the long term".

"And therefore, that's why we'll have a presence there and should have a presence there for the long term," he said.

The interview came with less than one week before key US legislative elections in which Mr Bush's Republicans worry that the unpopular war in Iraq may cost them control of the Senate, the House of Representatives, or both.

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IMO the PRC Central Government will not face the same liabilities that the Japanese and Taiwanese governments would face in the near future. As a non-democratic state, it's not like they'd have to cater to special interests like the AARP.

As for the birth rate issue, China's one child policy is applied differently between urban and rural areas. Usually urban areas are stricter and rural areas are more lax. The current sub-replacement fertility rate is estimated at 1.7 to 1.8 child per women, versus replacement level of 2.1.

If the PRC government wanted the birth rate to climb to 2.1, they can simply relax the one child policy and allow couples to have more children without penalty. But I believe their ultimate goal is to reduce the country's total population to under 1 billion for sustainable development.