Pensions are different however. Pensions are usually provided by a company. Since it is no longer the standard companies to have pensions those that do tend to have increased costs and thus probably aren’t able to compete in the price takers/commodity market. I mean this is the reason most manufacturing has left north america.

I think countries that achieve economic success in the long run are going to be about sustainability. I believe that countries that can ensure the majority of their country has health care and monetary support for the elderly will be the most competitive at attracting talent. This is going to prove to be the most difficult in countries that have had a decreased growth rate and have more elderly than young. Any health care system or pension plan would be strained by this. But I feel in the span of say 100 years, achieving sustainability of the population and environment will lead to success.

This is a significant social, political and economic issue in China, as is the issue of the funding of pensions as China’s population ages.

As I understand it, the “one child” policy was actually enforced pretty strenuously in rural areas, where a heavy tax was placed on families that had a second child. Bearing the cost of paying that same tax in urban areas was economically more feasible. The purpose of “one child” policy was to slow population growth to a level that might be sustainable given the national natural and industrial resource base.

The male bias is largely due to the lack of a pension/retirement system. Traditionally Chinese women became part of their husband’s family, and during old age it is that family that takes care of the “grandparents”. So, imagine the social strain when you can only have one child without a significant financial penalty, and if that child is a little girl, you have no prospects for an extended family who will care for you during old age, and no “retirement” plan or social safety net.

Some of this is being thrown into the wind with urbanization, and with migration of many young people to the coastal areas where there are a lot more opportunities. This extended family dislocation may be at least as big a social problem as is the comparative shortage of women as marriage partners during the next 10-20 years.

Here in the US we are going to face some issues that are related to the Chinese problem with retirement and pensions. Our society is somewhat unique in the way that both health insurance and retirement pensions have often been linked to employment. Now we see that health care during retirement is harder to secure, and that prior agreements on health care benefits and retirement plans are being jettisoned.

But here is the important point that I would like you all to think about — will economic success in the future go to those nations (USA, China, or others) that are most effective in sorting out the issues of health care, pensions, etc.?