Tuesday, October 23, 2012

The Birth Dearth Is Bad for Business, Baby

While looking at a new outbreak of Boomer-bashing in the US media -- provoked by continuing economic woes and the election --I came across a columnist in the Atlantic magazine who gets what the basic problem is. “Demographics are economics,” says Derek Thompson. How true.

"In normal times, millions of people get married in their mid-to-late 20s. They spend lots of money on a wedding. They buy a car, often with a loan. They buy a house, always with a loan. They buy new furniture and appliances. With their time and money coupled, expenses that were once extraneous now feel reasonable. Maybe he was individually satisfied with sports bars and she with Netflix, but as a couple, it makes more sense to watch live sports and TV shows on their new couch, and so they buy cable. They have a kid, or more than a few. You know how the story goes."

You mightn’t like the consumer approach to marriage but it’s true that when a couple starts a home and family they buy stuff…And if they don’t, they don’t…

Even as singles, young adults are cutting back on significant purchases, Thompson reckons. If you move back home with your parents you could do without your own car, for instance.

So that sounds like a double whammy for the economy which is not compensated for by spending on phones and eating out. A loan from the government to pursue studies that you may take decades to pay back may help the economy to tick over but at the expense of even further delays in marriage and procreation…

He hopes that “babies will return with the economy”. But perhaps the economy will only return with the babies -- meaning that, whatever the economy is doing, more young adults should start to think about their futures in terms of marriage and family life and gear their studies and career choices to that end. It may take some moral courage, and not a little family support, to buck the trend.

Meanwhile, if the Boomers are to blame for anything it is for swallowing the two-child line sold them by the previous generation, the so-called Greatest -- or at least its business and political elite -- and its accompanying message to consume, consume, consume. There comes a point, surely, where buying stuff for a very small family -- and eventually just oneself -- begins to erode both the economy and humanity.

("What’s really wrong with the economies: the baby dearth" by Carolyn Moynihan at Mercator.)

Thanks to Rob Quiring for drawing this article to my attention.