Why a shrinking human population is a good thing

30 06 2022

The other day I was asked to do an interview for a South Korean radio station about the declining-population “crisis”.

Therein lies the rub — there is no crisis.

While I think the interview went well (you can listen to it here), I didn’t have ample time to flesh out my arguments; I’ve decided to put them down in more detail here.

Probably the most important aspect that I didn’t even get a chance to cover is that globally, our economic system is essentially broken because we are forced to exist inside a paradigm that erroneously assumes Earth’s resources are infinite. They are not, as the global ecological footprint clearly shows.

To slow and perhaps even reverse climate change, as well as mitigate the extinction crisis underway, we are obliged to reduce consumption globally. Shrinking human populations will contribute to that goal (provided we simultaneously reduce per-capita consumption).

But that argument, no matter how defensible, is still not even remotely appreciated by most people. It is the aim of only a minority, most of whom have very little political power to engender change.

The oft-touted ‘crisis‘ of ageing populations is founded on the erroneous notion that it will lead to economic crises for the affected countries. Indeed, countries like South Korea and Japan have declining populations, others like Italy are stable and will be declining soon, and others like Australia are only growing because of net immigration.

The reason for the hyped-up panic generally comes down to the overly simplistic ‘dependency ratio‘, which has several different forms but generally compares the number of people in the labour force against those who have retired from it. The idea here is that once the number of people no longer in the labour force exceeds the number of those in the labour force, the latter can no longer support the entirety of the former.

This simplistic 1:1 relationship essentially assumes that you need one person working to support one retired person. Errrh. Right. Let’s look at this in more detail.

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Which countries are the ‘wealthiest’?

23 06 2022

Last week I wrote a post about various indices of country-level environmental performance, which I prefaced with a caveat that the data are a few years old.

This week I’m going to discuss national indices of economic performance and prosperity. There are indeed some surprises.

But standard metrics of economic performance at the national level almost universally fail to encapsulate the sustainable economic prosperity of its citizens. One could, for example, simply list the ‘wealthiest’ nations according to simple economic turnover by employing the standard, but wholly unsatisfactory metrics of gross domestic product (GDP) and gross national income (GNI). Even most economists admit that GDP and GNI are dreadful measures of ‘wealth’, and the differences between them are largely immaterial.

Top 5 ‘wealthiest’ nations according to per-capita gross national income: Qatar, Macao, Singapore, Kuwait, Luxembourg.

It is probably easier to view GDP as a speedometer, for it measures the speed with which an economy is contributing to the generation of goods and services (i.e., economic turnover), but it does not measure the loss of biodiversity, ecosystem services, and other environmental assets such as forests and mined resources, it does not measure the build-up of greenhouse gases or hormone-mimicking toxic chemicals, nor does it take depreciation of physical capital in our society’s infrastructure in account. As it turns out, GDP actually rises following environmental disasters such as a major oil spill because of the jobs created to clean up the mess, but it does not measure in any way the economic advantage of growing produce in your garden because the goods are not ‘traded’ in the standard market

Nor does GDP account for the disparity in wealth among a nation’s citizens, so even though most people might be poor, the existence of even a handful of billionaires can in fact raise a country’s GDP. The GDP metric is so unappealing that even the World Bank has tried to come up with better ways to measure wealth. Although it still falls short of measuring true wealth, ‘total wealth’ — measured as the present (discounted) value of future consumption that is ‘sustainable’ — tries to take into account a country’s present wealth minus damage to its non-renewable stock that is currently being exploited unsustainably (e.g., forests). As such, economic policies based on total wealth would be better able to ensure the long-term sustainability of a nation by including the ‘stock’ of existing capital that includes natural capital. 

Top 5 ‘wealthiest’ nations according to per-capita total wealth: Norway, Qatar, Switzerland, Luxembourg, Kuwait.

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Best and worst countries by different environmental indicators

15 06 2022

I’ll preface this post with a caveat — the data herein are a few years old (certainly pre-COVID), so things have likely changed a bit. Still, I think the main message holds.

Many years ago, I compiled seven different national-level measures of environmental degradation to show that countries with the largest human populations, and hence, the largest economies, had done the most environmental damage — not only to their own resources, but to the world’s in general.

That last observation is important because there are really two main ways to quantify a country’s environmental performance. First, there is its relative environmental damage, which essentially means what proportion of its own resources a country has pilfered or damaged. This type of measure standardises the metrics to account for the different areas of countries (e.g., Russia versus Singapore) and how much of, say, forests, they had to start with, and what proportion of them they have thus far destroyed.

Looking at it this way, small countries with few large-scale industries came out in the lead as the least-damaged environmentally — the least environmentally damaged country according this metric is Cape Verde (followed by Central African Republic, Swaziland, Niger, and Djibouti).

However, another way to look at it is how much of the overall contribution to the world’s environmental damage each country is responsible, which of course implies that the countries with the highest amounts of resources damaged in absolute terms (i.e., the biggest, most populous ones) disproportionately contribute more to global environmental damage.

Using this absolute metric, the countries with the greatest overall damage are Brazil (largely due to the destruction of the Amazon and its other forests), the USA (for its greenhouse-gas emissions and conversion of its prairies to farmland), and China (for its water pollution, deforestation, and carbon emissions). On the flip side, this means that the smallest countries with the fewest people are ranked ‘better’ because of their lower absolute contribution to the world’s total environmental damage.

Looking more closely at how countries do relative to each other using different and more specific measures of environmental performance, the best-known and most-reported metric is the ecological footprint. This measures the ecological ‘assets’ that any particular population of people requires to produce the natural resources it consumes and to absorb its wastes.

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