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Comment by cstross | Hacker News Reader

Note that Japan is in a savage demographic crunch, with a TFR well below replacement and an ageing population, which means the ratio of workers to dependents (the elderly) is dropping. Which in turn reduces average productivity and GDP. Actual population decline is deflationary and Japan's been in that situation since the start of the 1990s.

This isn't a defense of Abenomics, but a reminder that Japan has structural problems that can't be easily fixed (unless there's a huge sea-change in public opinion and they start actively trying to attract younger immigrants -- which would be a first-time-ever thing).

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Immigration is not one-stop solution to fix GDP because integration is huge cost that is rarely taken into account. And of course it doesn't at all address the real problem, that men and women no longer creates families.

This is typical of todays debate in the West, not solve the real issue, instead offer some sort of band aid solution and completely ignore the real issue.

Japanese is a population of about 126 million living on size of Norway, a country of 5.4 million inhabitants.

Immigration is probably the only thing right now that mitigates the problem of consecutive declining birthrates. AI and robotics aren’t there yet. Historically, while immigration does have some downsides especially if your system has a lot of entitlements, the pros outweigh the cons. Imo it’s a big reason why the US eventually surpassed Europe, and a large reason for slowing down our decline.

>Historically, while immigration does have some downsides especially if your system has a lot of entitlements, the pros outweigh the cons.

You have to be far, far more specific. Both real estate and the job markets are already suffocating the average young adult in most developed countries. Your solution proposes to put more pressure on both of those markets, for the sake of another population. Young adults aren't going to see the benefits of this for a long time. Younger generations likely won't for a good while, either.

Additionally, by pumping in more people from outside, you're specifically pressuring skilled workers who put more thought to popping out babies than just doing the deed. There will be some semblance of resentment potential parents feel they can't reasonably have kids in a country already squeezing them things out at the current population size, despite wanting to. You know, the exact same thing happening in most countries today.

Even if Japan doesn't have similar problems with RE, the population isn't exactly waiting for immigrants willing to accept poor work conditions and pressure other candidates to do the same.

>Imo it’s a big reason why the US eventually surpassed Europe

You just going to conveniently skip multiple events leaving Europe in shambles and setting the US up to be in prime position to take over the global economy?

> You have to be far, far more specific.

I don’t have the energy or time.

https://www.bushcenter.org/catalyst/north-american-century/b...

https://www.cbpp.org/research/poverty-and-inequality/immigra...

> Both real estate and the job markets are already suffocating the average young adult in most developed countries.

> Additionally, by pumping in more people from outside, you're specifically pressuring skilled workers who put more thought to popping out babies than just doing the deed.

You’re blaming this solely or mainly on immigration? You’re also going to have to be more specific.

> You just going to conveniently skip multiple events leaving Europe in shambles and setting the US up to be in prime position to take over the global economy?

Even without the wars, the US already had a trajectory of supreme power. We had the natural resources & geographical advantages, as well as the size and quality of our population which was positively impacted by immigration.This is why the UK pondered going to war with us again.

This was the US plan to counter it

https://en.wikipedia.org/wiki/War_Plan_Red

The Soviet Union also had geography and natural resources. Didn't seem to help much. Japan had no natural resources. When they turned to free markets after WW2, the Japanese economy had a spectacular rise.

I disagree. Most of the Soviet Union’s land is uninhabitable let alone usable, but let’s ignore that. The Soviet Union also didn’t have the economic system, infrastructure, investment, and immigration to take advantage of it.

I’m also not sure how this weakens my argument that the US was destined to superpower status even without the world wars.

Operating under the US military umbrella, as a major US & EU trading partner, had its advantages.

Japan's resource scarcity combined with long-term political stability (like Britain, it's been spared invasion for well over 1,000 years) promoted highly-efficient industry. Post-war industrial policy emphasized efficient transportation (motorcycles and small cars), and electronics, which worked pretty well up through the 1990s.

Russia had been industrially-backward until well past the Communist overthrow (and had lost a war to Japan immediately prior to WWI). It has mineral resources but a small population, difficult trsnportation challenges, and a precarious food situation. The country itself is huge and multi-ethnic, with a legacy that tends to breed frictions.

I don't agree completely, some parts are just fantasy projections. Looking at an example of Switzerland, who for quite some time desperately relies on constant immigration to not end up in exactly same demographic and economic place as Japan.

Swiss simply don't want to have kids, and if yes its 1 max 2... Mentality is really not much pro-kids, system gives only bare minimum support and taxes you massively for things that are free everywhere around. Kindergartens costing you 12% of the income - if you are incredibly lucky/connected to actually get in. 12 weeks of paid maternity leave when friends back home have 3 years/kid, and after that a lot of pressure to come back to work. Being taxed more when actually being married compared to single couple, laws from more misogynistic era when only men worked and women stayed home.

I've read that Switzerland is consistently rated as the worst developed place to have kids when judged by conditions created by state/society.

So its more often than not immigrants, some naturalized over time, that have kids. Property prices are ridiculous long term, many Swiss never lived in their own property (even apartment) and never will, even in retirement (or they will buy something in Spain or Thailand and migrate to have a decent lifestyle).

Despite all this (and much more), society is fine. Somehow they still manage to keep up 'Swiss spirit' of running things smoothly (mostly at least, based on my recent experience with residence permits which was and still is rather Kafkaesque). The points you raise are just part of whole package and nobody whines about it. You must realize that owning your own property is not some basic civil right, and for some its more burden than blessing. Getting rid of that notion is actually quite liberating from my own experience, more time on more important things in life.

Also property market is set to conditions in which currently it doesn't make any sense to buy properties. Due to how ownership is taxed, you never own more than 35% of the property, perpetually paying interests. But interests only right now are higher than rental prices. and something tells me its not going down anytime soon.

I have several friends with small kids in Switzerland. Seen from inside, they say the system is not bad at all. They also lived in a country with 2 years of maternity leave and they preferred Switzerland overall.

While my small sample statistics contradicts you, for me it is good enough because I trust these sources (I know some of these people for over a decade).

Switzerland and Japan doesn't have land to sell, so it's not a good example for the ideal of home ownership.

Things run 'fine' because the immigrants and majority of swiss people have no foothold in the country. There is very little opportunity to sway the dial in their own favour, so the people who make the compromises and let go of everything are happy with it.

The problem of young people having economic problems seem to be rather orthogonal to immigration. Immigration, if done right, should create more wealth than the immigrants themselves consume. So there should be more wealth going around for the aboriginal population. That this wealth doesn’t reach the younger population seems like an orthogonal policy problem. A salient example that comes to my mind is policies restricting housing supply.

> Europe in shambles

Europe turned to socialism much earlier than the US. While this started around 1900, Germany's situation can be instructive.

When WW2 ended, as we all know, Germany was flattened. Although Germany did start receiving Marshall Plan money, it was considerably less than Britain and France received. Germany's solution was to become a free market economy. The result was the "German Miracle". West Germany roared from flatline to the dominant economy in Europe.

Britain and France never really recovered economically. East Germany, under the communists, did very poorly.

West Germany's success continued until 1970, when Germany put socialists in power and the economy slowed down.

It's just another example of free markets working very, very well.

which markets are free? markets work well for things that are measured, not everything that matters is measured. Also worth noting, countries have the right to determine their own ways, irrespective of some dictionary defined word like 'markets'

Making up your own definitions of words does not a persuasive argument make.

The thing is if the idea is that women should equally participate in the labour market then child births will decline.

Thus if immigrants already has or adopts the Japanese way of living then child births will still be low.

Or if immigrants have high childbirths then women will not equally participate in the labour market, therefore that family only has one or fewer incomes in a high tax society that is designed for two persons per family taxable income, thus that family will probably be a net loss for tax payers.

> Imo it’s a big reason the US eventually surpassed Europe

When was that?

If I'm reading the stats correctly for Japan

1960 94 million, ~50% labour participation rate for women, ~4 million child births, ~1 million abortions

Today 126 million, ~80% labour participation rate for women, ~800 000 child births, ~150 000 abortions.

Accounting for social changes, birthrates would still be on the decline in developed countries due to declining year over year male fertility. ie if we outlawed abortion and women didn’t work, it would still be decreasing

You would still need immigration to make up for the losses

If Japan went from the current child birth rate to same same rate as Hungary then Japan would be almost be at equilibrium, Japan has the same child birth rate as Hungary ten years ago before Hungary added a tax credit program for new families.

Almost isn’t good enough. Our current economic system also demands growth and not stagnation. Immigration is still better which is one reason many European governments changed their stances on it.

Oh, so you want low skilled immigration to Japan like in Europe, not high skilled immigration. How would that help anything?

Sweden has about ~5 physicians per 1000 people, largest migration groups to Sweden, Syrians has a rate about ~1.3, Iraqis ~0.7, Indians 0.9, Pakistani 1.1, Somalis ~0.02.

And then you have other important public skilled professions like teachers & educators, law enforcement, health services etc.

Thus low skilled immigration increases shortages on high skilled professions.

Discussing such petty issues with strangers online must be very amusing. Torus wants to increase his local native population, Chaos regards all humans as capable to improve economical challenges. Until we unite as species I am afraid we are gonna just end up destroying each other and going back and forward discussing reasons why our fellow humans can't decide to move to another piece of land for x/y reasons in this small planet of ours...

Why can't we just give people the freedom to do whatever they want, society will sort itself out and everything may balance out in the natural order of things. One point is that unites both, right and left, is to make life a living hell to those who dont give importance to these petty issues and just wanna work together with others to make this globe a better living place for all...

Japan doesn’t like immigration at all. Even high skilled immigration is discouraged culturally. The second people realize that you’re not a tourist is when the Japanese stop smiling.

You still also need low skilled immigrants. Otherwise, you’re not going to have people do terrible jobs like mortician and meat packer positions to name just a few jobs that native Japanese are hesitant to do. Just to remind everyone, AI and robotics are still not there yet. Anti-immigration advocates, just like the brexiteers, fail to account for reality.

> Japan doesn’t like immigration at all.

Thus you agree with me that integration is huge cost, because immigration will create big friction within the Japanese society and that is a cost.

It is interesting that you admit that Japanese society is anti-immigration and yet you push this as solution to their problem. That is elitism.

> You still also need low skilled immigrants

Another alternative is to increase salaries, but immigration does the opposite, pushes wages down, especially for low income jobs.

Problem is that low income jobs is net loss in payed taxes in high tax welfare states, because the tax they put in is lower that the benefits they get, thus the more low skilled immigrants you bring the higher the taxation must be, but too high taxes will have a negative effect on general employment and business.

Believing that low skilled jobs is something beneficial for an advanced society is like believing that handing out shovels to dig holes is net beneficial in world with excavators.

What a society becomes rich on is processing either goods or services to something of higher value and preferably in multiple steps, not flipping burgers at minimum wage.

>Immigration is probably the only thing right now that mitigates the problem of consecutive declining birthrates.

No it isn't. It's fairly simple to increase declining birthrates in the west, there just isn't the political will do do what would be necessary to accomplish that (ie: Prohibit female education, abortion, birth control, kill the welfare state, etc...)

If you just make it easier to have kids, people will have them. It's hard to justify bringing a child into this world when both would-be parents have to work to make ends meet and they can't afford childcare.

Having kids is quite easy. Most of my colleagues that don't have any kids got into this situation because they pursued careers (long live the corporations selling dreams about careers) and then at 40 years old they figured out they cannot have kids anymore, even with fertility treatments they now afford. The younger ones that are still age 25 to 30 strongly believe it is too early for having kids and they postpone that for another 10-15 years.

Having kids is easy for a man. For a woman, it is anything but.

And women’s freedom to choose when and how many and who to have children with is what has caused birthrates to decline.

From what I can tell, women have been eating the true costs of birthing and raising children since forever. Now they can choose the terms under which they are willing to subject themselves to the risks and effects of childbirth, breastfeeding, and child rearing, so the “free” market should help see what the appropriate price will be.

Of the women that have kids and I talked to, none complained that having kids is not easy. I know women that after having the kid they planned for, decided to have 2 or 3, even 4 and it was their decision, not their husband's. The only women I heard complaining about having kids are the ones that have none, which is a bit strange - they have only second hand experiences, if any, of having kids.

Yes, now the future of the human race is practically at the hand of the women only. So far it is not going well, as a society and as a race.

> The only women I heard complaining about having kids are the ones that have none, which is a bit strange - they have only second hand experiences, if any, of having kids.

This is an implicit confirmation bias; of course more of the women that don't want kids will have no kids.

No, they won't. Even in developed countries where having children is financially manageable, people do not want kids. Less than 2 on average. The wealthier, the less kids. It's a consistent international conclusion.

When people do not NEED kids to survive, they'll have few or even none.

This is an important point, but I do believe there's truth to both arguments. The common wisdom in developed countries is that you don't have kids until you're financially stable, and increasingly financially stable includes education and career building through your prime reproductive years for both potential parents. And your point, kids were an asset in an agrarian society without machinery, they're not assets in our modern industrialized societies. I think there are more factors, one is the perceived state of the world as a worse place than before, true or not, and another is the increasing control that external entities like the state exert on the internal workings of families. That's not exhaustive, but I do think overall the incentives to start families are just no longer there, so people are doing less of it.

I agree that modern society is not set up to encourage having children as well as that people start about a decade too late with it.

But still, even in societies with excellent maternity leave and child support, people do not have more children.

Why not? Because things like "free child support" in reality are a clever distraction. It's not there to help you have a large family, it's there so that the parent keeps working full-time.

It doesn't really solve anything. There's no point in having a (large) family if you can't be with your family.

It doesn’t matter. The birth rate will still drop. Accounting for ALL social issues including “making it easier to have kids”, the birth rate will still drop because male fertility keeps dropping in any country that’s reached a certain level of industrialization. This includes BOTH developed and developing nations. There’s no definitive culprit, but many researchers believe male infertility is being caused by the endocrine disrupters that leech from plastic products that we use for food applications.

Are you including Japan as part of the "west"?

That’s my point. Immigration is the best solution.

Hungary has increased their number of births per woman from 1.23 ten years ago to 1.55 today by giving tax credits for new families.

It’s still not enough for even replenishment, especially when our economic systems demand growth.

Then we should reform our economic system, endless growth is not viable, especially if you take into account climate and environmental issues. Again, band aid solutions does not work in the long run. We need to adress the real issue.

That’s really easy to say, but much harder to execute. Japan has been in stagflation for decades now. They still haven’t addressed the issue. The reason is because there’s current no known solution for it since centralized planning doesn’t work. If anyone has both the capabity & incentive for finding this answer, it would be them.

Immigration is still the logical choice until the solution is found.

  > centralized planning doesn’t work.

who said anything about centralized planning?

And yet as someone young and skilled and keen to spend time living/ working there there's really no readily available visa options (unless I formally marry my de facto spouse)

Immigration won't solve the long term declining birthrates because it's a globally systemic problem. Moving people from one country to another won't actually solve the population decline globally - which is needed to support the broader global financial trade markets that have propped up the golden financial age we've experienced over the last 70 years.

"The End of the World is Just the Beginning" has been a great read so far (about halfway through it as of this comment) and the author, Peter Zeihan, dedicates a significant portion of the book to discussing the problem of population decline in-depth.

Obviously our economies are going to need to find a way to adapt to declining populations within the next few decades, and there's something to be said for countries like Japan being ahead of the curve there, but at this stage it's hard to see how they can adapt quickly enough without avoiding significant economic disruption.

Mitigation isn't a solution. The immigrant children will struggle to have kids as well.

The point of a government is to support human life. If the system is prefering wealth and control over human life, why bother with it?

The gov is openly failing at it's job to create more families. Which is it's tax paying base.

>integration has huge costs

The point is whether is has more immediate benefits than costs. My sense is that it usually does (immigrant population contributes more economically that what they cost in taxes), at least in the countries I've checked. The exception might be countries that accept a huge amount of refugees (I dunno, just speculating)

If you have evidence to the contrary, please provide it.

It depends entirely on what kind of immigration you are talking about, there are empirical evidence that certain type of immigration can be beneficial, but it also exist empirical evidence of the contrary, thus making a general claim is not possible without looking at the specifics, i.e. which immigrant group to what country and in what time.

Is there really no other way to go around demographic ratios except by importing young people? Why can't we make economy work with less working people per retiree?

There are other solutions of course, like automation. With technology we can do more work on less time, and that is something we have done since the industrial revolution. It is a bit bizarre that on technology forum this is not go-to answer.

Automation will put more money into the pockets of people who own the companies, IP and capital. Everyone else did not get much from it for a while and got more and more burden of education to work in that automated workplaces shifted on them.

> It is a bit bizarre that on technology forum this is not go-to answer.

Automation is more likely to add rent-seeking to the status quo than improve conditions for society.

Because the technology is not ready yet

That would require productivity growth, which requires investment and training, rather than profit extraction from cash cows.

The West has got very used to living off cash cows.

The other option is to invest abroad, and repatriate the profit. Which is something else Japan has done, the Chinese are doing, and the West seems to have forgotten how to do.

>The other option is to invest abroad, and repatriate the profit.

In other words, colonialism. I wouldn't say the West "has forgotten"; they are still extremely good at it with careful financial engineering, they can operate it without looking like slave drivers.

The problem is there is only so many places you can invest and the west has burned enough bridges where any sovereign nation is incredibly careful when taking money from the west.

  > Why can't we make economy work with less working people per retiree?

we can make any kind of economy we want (its a human invention after all) which then makes the answer a lot more political (there are many intertwining interests that don't want/cant change)

Economics is not a human invention. It is a discovery, a study of the feedback mechanisms that lead to certain distributions of resources. When you pretend otherwise you get mass famine.

  > It is a discovery, a study of the feedback mechanisms that lead to certain distributions of resources.

and who makes those feedback mechanisms? are you saying that property rights and other rules of trade are not human inventions?

They're naturally occurring.

We usually try to create rules of trade and property rights that prevent things like famine and violent conflict. This is because certain sets of rules would inevitably lead to these things. What rules produce the most stability and health are not known, figuring those out is a process of discovery, it is not up to people which rules work and which rules don't because what actually works with regard to distribution of resources depends on how the natural world works.

  > what actually works with regard to distribution of resources

isnt economics much more than just distribution of resources? and distribution to what end? "what works" largely depends on what your trying to achieve, no?

for example, we could say that china is doing economics much better than the west (growing faster, better infrastructure, better education, more dynamism etc), if you wanted to say "what works" but im not sure most people here would want to follow that path...

i feel there is an inherent political aspect that arises in economics that is being ignored... but maybe im just crazy?

Economics is not more than just the distribution of resources, no. The goal is to have efficient distribution of resources so that people can have the things they need within their means if possible, and to find new ways to process resources to produce things that make peoples lives better.

What works is largely about what you're trying to achieve, which is why when you see people trying to achieve things other than what I said, you wind up with mass famine, forced migration, shortages, and unnecessary expense. You see these things because they're not trying to avoid these things, they have other goals in mind.

There is a political aspect to economics, in that those who want to siphon resources away from efficient distribution and towards their goals will use political machinery to coerce a population. You see this in many instances, ranging from holodomor to artificially inflated drug prices in the US.

The economic problem Japan faces is temporary while the demographic change from immigration would be permanent. It makes sense that the Japanese are avoiding it.

Opening to immigration would lead to cultural genocide of Japan. Eventually those immigrants would (rightly) want equality and would introduce their own customs, traditions, and myths, etc. They’re better off preserving their way of life than destroying it so make believe numbers look better.

It's not about making numbers look better, it's about ensuring that your people don't become destitute. It's an unfortunate fact that when one third of your population is able to work (naïve example of parents all having 1 child for a generation) then each worker has to feed 3 mouths, 3.5 if they also have one child (the other parent still has two parents but shares the burden of the child). That's will full labor force participation. It's not viable no matter what social or economic system you have.

demography is a problem in todays day and age, japan is a small island, and it is over populated, it just is a correction

the dude probably just was against the American military base that is being built

their government also said they'd ignore the result of a referendum vote, wich emphasis the idea that japan is no longer a sovereign country and instead is an American vassal that's getting used in preparation of the great pacific war

that dude was a military guy, he wasn't a trader

demography is a problem in todays day and age, japan is a small island, and it is over populated, it just is a correction the dude probably just was against the American military base that is being built

that dude was a military guy, he wasn't a trader

> and they start actively trying to attract younger immigrants

Well that certainly won't happen with higher taxes (unless the benefits outweigh the costs for the immigrants). They must get data to build their Laffer curve.

https://en.wikipedia.org/wiki/Laffer_curve

The Laffer Curve is completely useless for practical economics. Beyond the obvious (if we actually have 100% taxation that won't work) its role is solely to enable politicians, and particularly US politicians, to pretend that somehow cutting taxes (a benefit to their wealthy donors) will break even or increase income, even though in fact it does not.

Economics for skilled workers, which are pretty much the only people getting into Japan via work, isn't the issue. Quality of life is very similar for skilled workers in most of Europe and Japan.

The problem is still the immigration process itself, the (work) culture, and the language. Japan still hasn't made the process as easy as pre-COVID, and it wasn't that easy to begin with pre-COVID.

Before joining my current job, I was interviewing for a position at one of Toyota's R&D spin-offs. While they made a stellar job at selling the company (and ensuring all immigration support, from language classes and professional assistance for the process of moving and finding a home), in the end I opted for a lower-risk, lower-friction option because I have a pre-teen daughter and moving countries is a bit stressful, especially crossing such a cultural chasm.

It's still something I would contemplate at a later stage - I actually enjoy jumping cultures.

They could probably attract millions of Westerners tomorrow if they really wanted. Whether or not that's a good idea / they'd like the influx is another question. But, they could do it without changing anything except their insanely difficult immigration schemes.

Abe did that. It's very easy to immigrate to Japan. The reason this succeeded is that nobody in the country noticed, which is why you don't know about it.

It's not that attractive to Westerners if only because wages are low so you can't pay off those student loans.

(Immigrate as in get into the country on a work visa, not as in get permanent residency - that's doable on a "highly skilled professional" visa though.)

What are you comparing with? Wages are not that low relative to the remainder of the developed world and student loans aren't that high outside the US. The US is the main outlier here, not the other way around.

Wages of English teaching are lower than jobs you can get in the US. Or for that matter tech companies, though it's fine if you work for an international company.

English teaching is a pretty obvious low-barrier outlier. Otherwise, you're confirming the US as your main point of comparison, without realizing the US is the primary outlier here. Compare the US to any other developed country and it becomes fairly evident why.

It is? Last time I checked a few years ago it was still rather onerous and was only easy for very highly skilled individuals, not just normal professionals.

You’re probably looking at the requirements for early access to permanent residency.

Work visa’s for skilled work categories in Japan aren’t particularly hard to come by. You just need a qualification or a few years relevant work experience.

Didnt they close the country for foreigners for 2 years due to COVID?

I dont think tourists or people on business trips could come in.

You can still get in if you get a work visa, and it's not that difficult to get one if someone wants to employ you. (If you have a four year college degree.)

The Laffer Curve is a bit of a myth which relies upon fixed exchange rate, fixed amount of money thinking.

That doesn't apply in the real world.

In a floating exchange rate system with a financial system, such as the one Japan has, the currency is essentially a closed system. Yen can't go anywhere else, and you can't use it for anything real outside of Japan.

That means that government spending is matched by the sum of taxation + non-government saving, and it is the spending that causes the taxation and saving, not the other way around.

What the curve says then is that people net save less in the middle of the curve - which generally means they are borrowing too much because they are not earning enough to maintain their standard of living.

The Laffer curve is an overly simplistic model that supposes government revenue is a function of income and sales tax revenue. This simply isn't true: Japan has control over its own money supply and can issue bonds. Nor are workers attracted to/barred from an emigration destination solely by tax -- other issues such as relative standard of living come into play.

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