Americans are having fewer babies – could that have unintended negative consequences for the long-term survival of the United States as a world power? Jonathan Last says 100% yes. Writing in the Wall Street Journal, Last suggests that the inverse baby boom means that innovation goes into decline and the economy and national security suffer as the nation’s demographics shift.
Low-fertility societies don't innovate because their incentives for consumption tilt overwhelmingly toward health care. They don't invest aggressively because, with the average age skewing higher, capital shifts to preserving and extending life and then begins drawing down. They cannot sustain social-security programs because they don't have enough workers to pay for the retirees. They cannot project power because they lack the money to pay for defense and the military-age manpower to serve in their armed forces.
The simplest solution “have more babies” is not without its hiccups. Raising children is expensive and difficult, and as a result, there’s not much incentive to do it.
On 'Real News' Wednesday the panel discussed with Last what larger problems can stem from America's fertility problem, and why the simple solution isn't necessarily out there: