What’s the Problem with Low Birth Rates?

Among the terms most frequently invoked in our society as the justification or basis for policies and arguments, “low birthrate” is one that cannot be left out. The core of such policies and claims is that Korea’s severely low birthrate is causing social and economic problems and therefore must be dealt with aggressively. Some even describe low birthrate as “collective suicide” or “national extinction.”

Even if low birthrate is not the cause of everything in our society, it has for quite some time been a standard item almost never omitted when justifying welfare policies and various regulatory measures affecting the economy and society. It has been more than 20 years since the government established the “Basic Plan for Low Fertility and Aging Society” in 2005 and began injecting budget funds under that banner. During that time, the budget allocated has increased sharply every year, and the number of programs promoted in the name of encouraging childbirth has also grown annually. Yet the total fertility rate has continued to decline, falling below 1.0 for the first time in 2018, reaching 0.78 in 2022 and 0.72 in 2023. The results have been dismal. A few days ago, the president even declared low birthrate a “national emergency” and announced that every possible effort would be mobilized in response. Of course, the substance of that full-scale response is, as one might expect, the creation of new government departments, an increase in the number of public officials, larger budgets, expanded and newly created welfare programs, and stronger regulation and intervention in the economy and the market. Local governments, too, have rushed into a “competition of handouts” in the name of encouraging childbirth. Some now even promise 100 million won for having a child.

If we briefly turn the hands of the clock backward, a picture emerges that is completely the opposite of today. Even just looking at the representative slogans of the time gives a sufficient sense of the situation. Starting with “If you keep having children thoughtlessly, you’ll end up in poverty,” then moving to “Whether daughters or sons, just have two and raise them well,” and even in the 1980s, when the birthrate had entered the 2 range, the slogan was “Even if each family has only one child, the land is still overcrowded.” In the late 1990s, the birthrate fell into the 1 range, and the birth control policy was officially scrapped.

Yet only about 10 years later, the country reversed course completely, saying the problem was now that too few children were being born, and returned to pronatalist policies. Accordingly, in the past, having fewer children made one a “patriot,” whereas now having more children makes one a “patriot.” When the birth control policy was being pushed aggressively, the statistic we constantly heard about was “population density.” We were told that Korea’s population density was among the highest in the world and that this was a grave problem. At the time this was being said, Korea’s population had just surpassed 40 million. Today, the population has exceeded the 50 million mark, yet neither the government nor the media even mentions population density. Instead, all we hear endlessly about is the “total fertility rate.” Presumably, this is because only the statistics that suit the tastes of the government, politicians, and the media are put forward.

Given these circumstances, it is hard not to tilt one’s head in skepticism whenever one hears that Korea’s low birthrate and the resulting population decline are grave problems.

First, one cannot avoid thinking about the problem of information. Put simply, this is to say that we should not indulge in the arrogance of believing we know the future with certainty and can respond to it accordingly. Was not the result of precisely that intellectual arrogance the all-out push for “birth control,” followed by an abrupt 180-degree turn and an all-out push for “encouraging childbirth”? This is not something for the state to drive in one direction by mobilizing all of its capacities. To push only in one direction, without leaving room even to look at anything else, merely magnifies the problem and the harm it causes. Rather, it is better to allow each sector of society, each social class, and each individual to choose and decide freely, and to respond in flexible and diverse ways. It is like the chickens in industrial poultry farms, bred artificially to have the same genes: when avian influenza spreads, they die en masse. Migratory birds with diverse genes, by contrast, may lose some, but the rest survive.

The next thing to consider is whether low birthrate and population decline will truly become problems so serious that they warrant the declaration of a “national emergency.” Humanity has already experienced a severe population decline, and that experience shows it was not unconditionally negative. When the Black Death swept through Europe in the mid-14th century, about 30 to 60 percent of Europe’s population died. As a result, labor became extremely scarce in agriculture and other sectors. The value of labor surged, and wages rose sharply accordingly. It was a natural consequence that workers’ bargaining position strengthened significantly and working conditions improved. The structure of industry also shifted toward sectors requiring less labor, and various innovations aimed at raising productivity appeared. Urbanization accelerated, and diverse forms of economic activity emerged. In this way, the foundations began to be laid for a leap into a new era.

Finally, even if one concedes that low birthrate and population decline really do create serious problems, one cannot help but question the effectiveness and direction of the policies designed to respond. As we saw earlier, hundreds of trillions of won have been spent, yet the total fertility rate has continued to fall. This is a clear policy failure and government failure. Since these policies seek to resist and block the current of change, failure is practically built in. In the case of the Black Death mentioned earlier, European governments also tried to block the current of change. In England, for example, authorities attempted through the Ordinance of Labourers to freeze wages at pre-plague levels and restrict workers’ movement. Of course, they failed. In short, the right direction is not to pursue policies that try to block or reverse the currents of social and historical change, but to recognize those changes and enhance and encourage the capacity of people and society to respond to them. Policy should shift away from simply trying to raise the birthrate and toward increasing productivity through technological and managerial innovation, education, and greater labor market flexibility, while guaranteeing and expanding freedom of choice so that people can respond creatively and flexibly to a variety of problems.

Hyukchul Kwon, Director of the Free Market Institute

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Original title: 저출생의 무엇이 문제인가?

Author: Hyeok-cheol Kwon

Date: 2024-07-11

Source: https://www.cfe.org/bbs/bbsDetail.php?cid=column&pn=2&idx=26756