Monday, May 9, 2011

Taxpayers Averted

A catchy title, I think, taken from the "Muck and Mystery" article below, describing the quandary that is China. The article quotes liberally from an article in the Guardian http://goo.gl/phaQH .



From the Guardian, "the day is in sight when China will run out of the cheap labour that has fuelled its growth in the past three decades; second, that the gender imbalance is worryingly large, the result of a preference for an only son over an only daughter; and third, that the burden of caring for a growing population of elderly citizens, in what is the world's most rapidly ageing population, will inevitably fall on a shrinking proportion of the economically active." Sounds similar to the situation in this country, but maybe a little more harsh. Perhaps the Chinese, not being as inured to general wealth, will be better able to deal with the consequences; or, having just gained general wealth, will be unwilling to give it up.



Particularly interesting is the conjecture that we will have to develop Africa as a major agricultural powerhouse, as Brazil is now, just to feed the world. As the author says, "damn all the planners."

Amplify’d from www.garyjones.org
The true problem, when seeing like a state, is a dearth of net taxpayers. Old folks consume more than they produce, and as has been argued for many years this threatens China's development.

China may get old before it gets rich. Ageing has been perceived almost exclusively as a problem for industrialised economies, following years
of urbanisation and industrialisation. Fewer people have associated ageing with a developing country where labour is often ample and the cost of child-raising inexpensive. China may be an exception. Although it is still considered a developing country by many standards, China has the fastest ageing trend among the 14 developing economies in the BRICs and the N-11.


Our analysis suggests that by the time China becomes an ëaged societyí in 2027, it will probably be considered a developed country, although it will still be considerably poorer than the US or Japan on a per-capita income basis. We believe the rapid build-up of human capital and the continued release of surplus labour from the agriculture sector will mitigate the negative influences on the labour supply from ageing.

What does "the continued release of surplus labour from the agriculture sector" actually mean?

most striking in the data released so far, China's migrant workers – the underprivileged and exploited floating population who left the land to build China's cities – has nearly doubled, up 81% to more than 261 million.


The future of these migrants is another headache for Chinese planners. Migration for work does not bring the right of residence in China since the household registration system, devised half a century ago to keep China's peasants tied to the land, remains in force. While China's cities rely on migrant labour, they are unwilling to shoulder the costs of providing migrants with health, housing or welfare. As they cannot register as urban residents, migrant labourers can be expelled by force to their home towns, they have no access to medical services and their children have no right to be educated in city schools. It's a system that has exacerbated China's deep social divisions and has been increasingly questioned as the country moves towards middle income status, a target it is likely to attain by the time of the next census in 2020.


By then, if things go according to plan, another 300 million people will have moved off the land and China's small farms will have been consolidated as the government attempts to feed the country's many mouths. By then, too, it has been predicted that 30 million Chinese males will not be able to find wives, with unpredictable social consequences. That may prove an even more intractable problem for China's planners.

One of the major issues in agriculture has been and continues to be the rapid growth of Brazil as an agricultural power house. In effect, they make more land while at the same time making all of their land more productive. This is a result of a concerted effort to improve their agronomic methods and rise above the developing world's typically paltry production levels and consequent poverty. The idea that there is a fixed amount of available land for food and fiber production is as silly as all "proven reserves" ideas about resource limitations. The abstract idea that everything is finite is abused to argue that the limits are known. They are not, and more importantly for these sorts of policy discussions the limits are far in excess of what the Malthusian anti-humanists claim.


The significance of Brazil's progress is hugely amplified by consideration of Africa. Many of Brazil's new methods apply to African soils just across the ocean from Brazil. Since they were once joined together before continental drift took them apart the parent materials of those soils are much the same. This doesn't just mean that another Brazil is possible since Africa is truly huge. The USA, Europe, China and India together aren't as large as Africa. Not all of that land has Brazil like soil and climate, but it perhaps helps one understand the silliness of the idea of immanent limits to food and fiber production due to land shortage.


A hue and cry will be raised - is being raised - by those who would prefer that such lands remain forever unused by humans, but they are not thinking clearly. There are no levers of power to control the trajectory of development. All that can be done by the planners is to create ever more baroque messes such as China has done. Sensible policies can only result from honest evaluation of current realities, and that includes the nature of humans and their societies. Rather than standing athwart history impotently screeching stop!, it is better to do what can be done to improve the results of developments.



Read more at www.garyjones.org
 

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