Wednesday Briefs – 5 May 2021

THIS WEEK: Drug Legalization; Cigarette Prohibition; Demographics and Destiny.

Drug Legalization

The question of drug legalization has been hotly debated for decades but legalization itself made little headway until recent years. The District of Columbia and an increasing number of states have legalized cannabis (marijuana) for medicinal and recreational use. A number of other states allow it only for medicinal purposes. See this map for current status of legalization.

From the perspective of health and public safety, we may rue or approve this trend a few years from now. With time, we will be able to look back and measure the impact of legalization. But from the perspective of the economy and geopolitics, legalization will result in some clear benefits.

Prohibition of marijuana and of other drugs has been detrimental to the US economy and destructive to a number of other countries. All across the globe, nations with weak institutions and small economies have had to contend with the rise of drug lords and terrorists financed by drug money. They are Colombia, Afghanistan, Mexico and many others.

Legalization has three immediate or quasi-immediate effects: 1) it moves tens or hundreds of billions of dollars from the black economy into the real economy, 2) it reduces the amount of money spent on drugs and diverts those dollars to other consumables or to savings, 3) it takes money out of the hands of domestic criminals and gangs, and 4) it cuts off the lifelines of nefarious actors overseas.

Cigarette Prohibition

This trend towards drug legalization is concurrent with another trend, which is to add new prohibitions on cigarette smoking. Some of the politicians who are cannabis-friendly are fierce crusaders against cigarettes. The public health consequences of cigarette smoking are well known but they should not in themselves constitute a pretext or reason for prohibition because prohibition is also destructive. The consumption of sugar and of fatty substances is arguably worse than smoking. But there is as of now no serious effort to curtail the consumption of sugar, notwithstanding the high incidence of obesity, diabetes and cardiovascular disease.

Awareness campaigns have been effective in reducing cigarette smoking in the United States and other developed countries. The rumored new government action is to reduce the level of nicotine to non-addictive levels. Leaving aside the intrusion of the state in a personal matter (is anything personal in a Medicare world?), we need to consider whether the proposed new measure could backfire. Nicotine is addictive but it is not as harmful as the other ingredients in a cigarette. If smokers have to light up a larger number of cigarettes in order to obtain their previous dose of nicotine, they will be ingesting a far greater amount of those harmful chemicals.

Prohibition would also create a black market and another source of profit for crime syndicates. Perhaps, the best way forward is to continue with what has been proven to work so far: health awareness campaigns that still allow people to make their own choices.

Demographics and Destiny

A common adage is that demographics are destiny. So let us look at the chart below which shows the size of the working age population in several major countries and regions. More details and numbers are provided in this post published yesterday.

A person who believes that demographics are destiny may deem from this chart that China, India and Europe must then be economically and geopolitically stronger than the United States. He/she would look at the BRIC countries and surmise that their combined power far exceeded that of the US for the past several decades. He would also project that the weight of sub-Saharan Africa will exceed that of China around 2035, fifteen short years away.

If none of this is true, it is obviously because demographics are not destiny. They are one of several important parts of destiny but are insufficient on their own to determine the course of a country. The other important parts are the pace of innovation, the state of productivity, the quality of governance and the depth of institutions. If the US economy still leads the world, it is because it has been able to combine all of the necessary vectors of growth while other major nations only have two or one or none.

The future is not preordained however. The order could change if some countries acquire more of these vectors and other countries lose them.

More reliably noteworthy in the chart are the expected growth of the working age population in sub-Saharan Africa and India, and simultaneously the decline of the equivalent population in Europe and China. More on this here.

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Update: Working Age Population Around the World 1960-2050

This is an update of a similar post from 2015. The UN projections have changed but only by small numbers. The main observations are the same as six years ago (click table to enlarge in a new tab).

The working age population (WAP, those aged 15 to 64) of sub-Saharan Africa continues to grow rapidly. It has more than doubled since 1990 from 252 million to 609 million, and is expected to more than double again by 2050 to 1.3 billion. If the reality turns out to be anywhere near these projections, it will be a significant challenge for African economies to absorb and to employ productively this enormous amount of new human energy.

India faces a similar challenge with its WAP growing from 928 million now to 1.1 billion in 2050. Though daunting, this represents a slowdown in the rate of growth from the previous thirty-year span 1990-2020.

The WAP of Europe, China and Japan have already peaked and will be declining for the rest of the century, per UN projections. Europe’s decline from near 500 million in 2005 to a projected 407 million by 2050 is mainly due to eastern and southern Europe. The WAP of France and the United Kingdom will flatline to 2050 while those of Germany and Russia decline.

In the United States, the steady growth in the WAP between 1960 and 2005 combined with a falling dependency ratio to fuel strong economic conditions. Growth in the WAP is expected to be more muted in the decades ahead.

Compared to the late 20th century and the first decades of this century, the future growth in the WAP will taper off or even turn negative in several regions and countries. Sub-Saharan Africa stands out as the exception that will maintain strong WAP momentum through at least 2050.

Wednesday Briefs – 14 April 2021

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THIS WEEK: Most People are Very Smart; Back to the Border; Podcast: Lebanon in Crisis.

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Wednesday Briefs – 7 October 2020

A weekly commentary on current events. Follow populyst to receive notification.

This week: Trump illness; Coronavirus third wave – USA and New York; The K recovery market; Polarized Media; Reading List.

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De-Politicizing Climate Activism

Or how Greta Thunberg can create more converts.

“Nature is not a temple. It is a workshop, and a human being is the worker in it.”                               _                                                                                                         Ivan Turgenev

Item 1: The outbreak of coronavirus that threatens to create a global pandemic and the tragic sudden death of basketball star Kobe Bryant both remind us that the unexpected can happen quickly and that we humans live in an environment that can at times be ruthlessly hostile.

Nature, fate, providence, or whatever one chooses to call it, works in inscrutable ways. The virus will spread and endanger millions, if humans do not stop it. It has no will or conscience and would inexorably destroy those who are dearest to us, in a matter of days. And, before downing Bryant’s helicopter and killing him, his young daughter and seven others, fate or gravity did not pause for a millisecond to ponder the sadness that it would inflict on hundreds of millions all over the world through such a senseless death.

Modern society is generally free of deadly viruses and helicopters are generally safe to fly. But it took centuries of human progress to get there in both instances. And it will take more human progress and ingenuity to seal the cracks in our vigilance that allowed the coronavirus to emerge and spread, and the helicopter to crash .

Screen Shot 2020-01-27 at 2.29.15 PM
CDC photo by Dr. Fred Murphy.

Item 2: Last week in Davos, US Treasury Secretary Steven Mnuchin volunteered that climate activist Greta Thunberg ought to get an economics degree before preaching her message to grown-up policy makers. That is more confidence in university economics departments than most of Miss Thunberg’s critics would be willing to concede. It is true that Miss Thunberg’s message is incomplete, but that is not for lack of economic pedigree. The building blocks that are glaringly missing from her campaign are 1) a better understanding of Turgenev’s aphorism on nature and man, and 2) a trip or two to China, India or other fast developing countries.

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Purity or Universalism?

This article first appeared at Quillette.

A few days after his recent passing, the Manhattan Institute reposted a speech by V. S. Naipaul from October 1990. The title, “Our Universal Civilization,” captured the triumphal and optimistic spirit of that moment, nearly one year after the fall of the Berlin Wall. In order to render this universal civilization in greater relief, Naipaul related the following about his travels in Asia [emphasis added]:

Traveling among non-Arab Muslims, I found myself among a colonized people who had been stripped by their faith of all that expanding intellectual life, all the varied life of the mind and senses, the expanding cultural and historical knowledge of the world, that I had been growing into on the other side of the world. I was among people whose identity was more or less contained in the faith. I was among people who wished to be pure.

If we had read this paragraph without knowing its date or the subjects’ actual geography, religion, and history (in this case colonized non-Arab Muslims), we might have surmised that Naipaul was talking about parts of America and Europe that he had perhaps visited in the months preceding his death. “People whose identity was more or less contained in the faith” could easily apply to certain constituencies in the West today, the more so if one allows some latitude in the definition of the word ‘faith.’

Nearly 30 years after he delivered this speech, Naipaul’s assumption that this was primarily a religious or Muslim phenomenon seems quaint. Today, we can see that the wish to be pure has emerged in opposition to universalism in many parts of the world including our own. We can no longer claim that it is just Islam that has grown resistant to the universal civilization envisioned by the West in the late twentieth century. Some groups within the West itself have also rediscovered their own craving for purity. Continue reading at Quillette >>>

Soccer for Americans

Three rule changes to turn American soccer into a big money maker.

The experience of watching a soccer game rarely lives up to the anticipation. You go in hoping for a 4-3 cliff-hanger (as with Argentina vs. France recently) but too often you end up with 1-0 or worse, a draw, or much worse, a draw that is resolved through a penalty shootout. This chronic letdown explains why Americans prefer watching other sports.

Photo by Torsten Bolten.

Except for anxiety-ridden upper middle-class moms trying to steer their teenage sons away from (American) football practice, most Americans don’t really care about watching soccer. If this is changing, at about the pace of a glacier inching down an Alaskan ravine, it is mainly because the percentage of immigrants in the US population has been on the rise in recent decades. These immigrants or their parents often come from countries where soccer is the leading spectator sport. It follows then that with the current crackdown on immigration, the future of American soccer is looking as frail as ever. NFL bosses need not lose much sleep.
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Africa: 800 Million Jobs Needed

African economies are in a race to get ahead of the demographic boom.

“Let us share without fear the journey of migrants and refugees.” Pope Francis (@Pontifex) tweet on 27 September 2017.

While some people in the United States are sweating the presence, against the backdrop of a demographically stagnant white population, of the 11 million undocumented immigrants or of the 30+ million other foreign-born residents, there are far bigger numbers brewing in other parts of the world, numbers that are so large that they could affect, decades from now, the life of an American citizen far more than would the rare determined Mexican or Guatemalan who manages henceforth to scale President Trump’s purportedly impenetrable border wall.

In the next decades as was so often the case in history, the future shape of the world could once again be decided in Europe and by Europe’s and the West’s handling of Africa’s incipient demographic boom.

In fact, if you are a generous-minded European who shares the Pope’s noble sentiment and who views the ongoing wave of migrants coming into your country as a benign and positive development; or, if you believe that borders are outdated constructs and that all refugees and other immigrants should be welcomed into the rich world; indeed, if it is your view that anyone who stands in the way of this openness is misguided by racist and nefarious motives, then it behooves you to test the strength of your belief by examining the larger demographic data coming out of Africa and Asia. Read more