Another Baby Boom Won't Cure U.S. Economy

The following is part of a series by our friends at CSRHub (a 3p sponsor) - offering free sustainability and corporate social responsibility ratings on over 5,000 of the world’s largest publicly traded companies. 3p readers get 40% off CSRHub's professional subscriptions with promo code “TP40“. Originally published on the CSRHub blog By Carol Pierson Holding In the early 1980s, Daniel Yankelovich, the master market researcher, gave a presentation to ad agency staff about coming demographic trends. His analysis came to the conclusion that the growing income gap would produce an increasingly angry underclass, a boiling cauldron that would one day explode. He showed us the future through demographics. I was hooked and subscribed to the magazine American Demographics So, 25 years later, when I saw the name of its founder, renowned demographer Peter Francese, in the e-newsletter Ad Age, I eagerly read his article. The piece “The Need for a New Baby Boom” proposes that two demographics, taken together, could help with the U.S. economic recovery: The top 5% of baby boomer earners could lift consumer spending by $3-400 billion if they could be induced to spend another 10% of their incomes. By reversing the decline in birth rates, Francese argues, we would create grandchildren that boomers would lavish that extra cash on. The chart he uses to illustrate his point shows birth rates declining in every age group except the 40-44 year-olds – a small segment: The comments that followed the article mostly excoriated poor Mr. Francese. Only one conceded that it might be a joke, but even giving Francese that license, what modern man in his right mind would suggest that women having babies is a solution to economic woes? Especially when his primary audience, ad industry employees, is 70% women. Even a kindly gent pining for grandchildren will get no quarter in this era of Mad Men-induced hypersensitivity to sexism in the ad industry, where women are still only 7-13% of top management. But an equal number of comments pointed out that Francese’s recommendations were far more dangerous: the environmental ramifications of promoting population growth are lethal. As we near the date in October when the UN projects global population will reach 7 billion (ahead of original projections), the conversation is already jumping ahead 72 years to when the UN projects population will hit ten billion globally and 483 million in the U.S. A population pressure that will likely result in mass species extinction and put “extreme pressure on food production, water and non-renewable resources.” I do not have to enumerate to this audience what human activity is doing to our environment or why promoting higher birth rates is such a bad idea. In fact, Francese’s chart seems to be a good sign, rather than a problem that needs to be fixed. These issues – birth rates, income and environmentalism – came together again on Saturday in Charles Blow’s NY Times column, albeit in a different way altogether. Blow highlights the fact that nearly one in four children in the U.S. go hungry and links child poverty to the 50% increase in unwanted pregnancies as Congress continues to enact laws that restrict abortion. Maybe Francese is tone-deaf on the issue of too many pregnancies and child poverty because his own state, New Hampshire, has so many retirees who moved there to take advantage of its lack of state sales tax. Accordingly, New Hampshire’s proportion of hungry children, 15.6%, is second to last in the U.S. (Only South Dakota has a lower rate; in Washington DC, the highest, 32.3% of children are hungry.) Francese hears the numbers talking — there is a relationship between income and birth rates — but he allows the appeal of grandchildren to get in the way of what could be a real solution. I’d love to see him examine the inverse: What is the relationship between increasing poverty and environmental degradation? How would increasing birth rates worsen those factors? Maybe he’d come up with a prescription that would still encourage baby boomers to spend 10% more, but on solutions to these closely linked problems: Sponsoring a hungry child? Adopting an unwanted baby? Buying an electric car? Retrofitting houses with insulation and Energy Star appliances? What about buying a tiny jewel of a house that’s totally self-sustaining? That would be almost as smart a move economically as moving to New Hampshire.  

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  Carol Pierson Holding is a writer and an environmentalist; her articles on CSR can be found on her website. CSRHub is a corporate social responsibility (CSR) ratings tool that allows managers, researchers, consultants, academics and activists to track the CSR and sustainability performance of major companies. We aggregate data from more than 100 sources to provide our users with a comprehensive source of CSR information on nearly 5,000 publicly traded companies in 65 countries. CSRHub is a B Corporation. Browse our ratings at www.csrhub.com.