The immigration Ponzi scheme is about to collapse

Pope Francis has once again shared his views on the way Italian young people are living their lives. In remarks some considered shocking, he told Millennials to stop being “selfish and egotistical” and to start families instead of substituting pets for children.

His sentiments echo those of Italian Prime Minister Giorgia Meloni, who recently stated that her government needed to do everything in its power to reverse falling birth rates.

It looks like the West is finally snapping out of its Malthusian trance and realising that it is in the process of falling off a demographic cliff. Conservative MP Miriam Cates has suggested that falling birth rates are the biggest threat to Western civilisation. She has called on the state to step in and encourage young people to start families by rewarding stay-at-home mums with tax breaks.

This sort of rhetoric is not popular on either the small government right or the culturally radical left. Small government conservatives simply do not want more state intervention in people’s lives, while the culturally radical hark back to 1960s era rhetoric against the stifling impact of the nuclear family.

Yet both would have a hard time arguing against the deleterious effects of an ageing population on society and the economy. If there are too many old people relative to young, then there will not be as many resources to go around.

The shrinking number of young people will have to work longer hours to maintain the same level of output and, as the number of older mouths to feed increases, they will be compensated less and less for their effort.

Already, the state pension is looking like it will soon be a thing of the past.

The solution floated by both the small government right and the culturally radical left is simple: immigration.

As the domestic population ages, they tell us, we can simply import workers from abroad. Any objection risks being branded xenophobic and sparking a row.

Yet the very terms of the debate are misaligned because most people making these arguments believe immigration can solve the problem of an aging population.

But the data is clear on this: it cannot. It may be able to address the decline in labour force growth, but that is a separate issue.

For evidence, look at the land of “fur babies” decried by the Pope: Italy. The country has seen such a severe decline in its birth rate and over such a long period that it provides a perfect object of study.

Italy is a nation that has tried to immigrate its way out of its demographic problems, meaning we can fruitfully compare it with Japan, a country with similarly dire demographic problems but which is more averse to immigration.

The period that is worth looking at is between 2000 and 2013. Within this timeframe, Italy experienced a significant wave of migration. Over 3.72 million more immigrants arrived in Italy than emigrants left.

Over the same period, Japan’s net migration levels were half that, at 1.88 million. Consider also that Japan has over double the population of Italy, meaning that between 2000 and 2013, on a per capita basis, Italy saw almost four times as much net migration as Japan.

At the same time, Italy and Japan had roughly identical fertility rates. Italy’s total fertility rate stood at around 1.37 on average, while Japan’s was around 1.35.

The difference between the two is basically a rounding error, making the comparison extremely precise.

Now, if immigrants can indeed offset falling birth rates, we should see the median age of Italians rise much slower than the median age of Japanese in this period. After all, Italy had four times the number of net migrants on a per capita basis.

Do we see this? No. The Italian and Japanese median age move in lockstep. Italy’s larger number of migrants made no difference.

Why is this? Two reasons.

First, migrants simply cannot compete with babies when it comes to creating a younger and more vibrant society. Migrants typically arrive in their 20s, meaning that they only have a limited effect on the median age. Babies, on the other hand, arrive at age zero and so have a greater impact.

Second, when they arrive migrants tend to assimilate to domestic birth rates. Even those who have larger families in their former countries will be exposed to the same challenges and distractions once they arrive on our shores. The pet shop will beckon.

The reality is that there is simply no easy way out.

The Pope is right. We need young people to start forming families at normal rates, rather than the abnormal ones that burden society with a greying population, push more work onto the backs of the shrinking pool of young people, and in doing so create both economic and social problems.

What is happening in Italy is broadly being mirrored across the West.

In the UK in 2020, there were four workers per retiree. By 2041, the Office for National Statistics projects there will be just three. The UK fertility rate is teetering around 1.7 births per woman, far short of the 2.1 replacement rate required to keep population level.

For all its benefits, capitalism appears to have thrived on urban childless consumers.

Contrasting Japan and Italy indicates that immigration cannot defuse the demographic time bomb. But a combination of public squeamishness and political short-termism is preventing us from having serious discussions over this existential threat.

Are there any solutions that don’t involve using the state? Is a combination of more homes and generous childcare support the answer? It’s time we let the policy debate begin.