Aging Demographics and Possible Solutions

As I was rummaging through the many articles today, I stumbled upon a particularly interesting article in the Economist. The article deals with changing demographics and creating employment challenges. I think this is more and more relevant as time goes on, especially when it comes to changing labor demographics, especially in OECD countries such as the United States.

An interesting chart to compare the differences in demographics between the United State, China and Japan: here

What this chart does not illustrate is that Japan has already aged versus the United States! While China's economy is growing robustly now, the Chinese economy will not go much further with its current growth models without fundamental changes to the structure and to the health of its economy. When shifts in change of demographics happens, it will turn many of American entitlement programs that are taxpayer funded into even bigger behemoths of debt than before! Altering such programs seem impossible currently with the deadlock in Congress...

There are real solutions to this problem, which include policies that might upset populist or nativist groups such as lax border policies and immigration. What these people need to remember is that some of them came here "illegally" on Ellis Island! Here are some possible tips that can be used to fix the current debt problems and generating potential growth opportunities in the economy:

1. Promote MORE Immigration (Both Skilled and Unskilled) to fix the demographics program.
2. Promote Math and Science in schools as a fundamental way to promote new innovation and growth.
3. Robust ALMPs (Active labor market policies) in placing people into high-tech, new-growth industries.
4. Cutting Corporate Taxes.

While these certain policies will not generate the much needed revenue the federal government needs in order to sustain these life-saving programs for many, I think it is necessary for these policies to be effectively implemented to change the structure of the US economy in congruence with the aforementioned changing demographics. The specifics of these particular policies might differ in how they could be implemented, but I believe they could be very effective in targeting specific problems.