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Trump Threatens 250-Year Trend |
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U.S. faces first real population decline in American history… Per capita GDP is the metric that matters… Have you heard of the "Presidential Bypass"? It's a legal loophole the rich use to keep their money. And though you might not know it, you can use the same exact loophole to slash your taxes. Legendary investor Robert Kiyosaki gives the details here.
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Dear reader, |
Here Bloomberg gnashes its teeth… and rends its garments. |
It fears the United States will suffer negative population growth this year — for the first occasion in its 250-year history: |
As the country prepares to celebrate its 250th birthday… the US risks recording a historic and economic milestone decades ahead of schedule: Based on at least one respected estimate, 2026 may see the first real population decline in American history. |
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The president's lamentable immigration and deportation policies are responsible: |
And there's little question that net migration is getting smaller thanks to Trump's policies. Census experts this week said they expect it to fall to only 316,000 in the year prior to July 2026, with the US "trending toward negative net migration"... |
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Recent work by researchers at the center-right American Enterprise Institute and center-left Brookings Institution suggests the US is already experiencing net negative migration… |
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They predict the US will have net immigration somewhere between a gain of 185,000 and a decline of 925,000 in 2026 — a prediction made before the US announced yet more new restrictions on legal migration at the start of the year. |
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Just so. Yet why should declining population figures rankle my tranquility? Why must population expand and expand? |
GDP Must Constantly Expand! |
The common economist will inform you that an expanding population expands the gross domestic product. |
Population growth expands the economic "pie." |
And if the native population fails to reproduce at the requisite rate, immigration must make the shortage good. |
Thus continues Bloomberg: |
Economists will tell you that the literature is clear: Immigrants create as many jobs as they take, and they contribute to overall prosperity… |
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The AEI/Brookings study released in January found that the effect of lower net migration would strip as much as 0.3 percentage points off growth in both 2025 and 2026. |
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Yet is the literature clear? Credible evidence indicates that even legal immigration burdens society. |
That is because of the public assistance immigrants receive in one form or other. |
Reports the Center for Immigration Studies: |
The National Research Council estimated in 1996 that immigrant households (legal and illegal) create a net fiscal burden (taxes paid minus services used) on all levels of government of between $11.4 billion and $20.2 billion annually. |
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Illegal immigrants with little education are a significant fiscal drain, but less-educated immigrants who are legal residents are a much larger fiscal problem because they are eligible for many more programs. |
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"You Can't Have Free Immigration and a Welfare State" |
In all, the Center for Immigration Studies estimates the American taxpayer will shovel out $451 billion per year on migrants. |
Where then is the net benefit? |
As argued the late economist Milton Friedman: "You can't have free immigration and a welfare state." |
The government of the United States has for decades clung to both. |
Behind the "population must expand to support economic growth" theory is economists' fixation upon the aggregate gross domestic product. |
Yet the per capita figure is far more central to economic health. |
Consider: Switzerland boasts the 21st-highest gross domestic product on Earth. |
The nation of India boasts the 5th-highest gross domestic product on Earth. |
Thus India is "wealthier" than Switzerland. Yet is India truly wealthier than Switzerland? |
India reports a per capita GDP of $2,818. The substantially "poorer" nation of Switzerland reports a per capita GDP of $111,047. |
Would you prefer to live in Switzerland — or India? |
The Economic Colossus of Bangladesh |
In the aggregate, the city-state of Singapore lags India even more than Switzerland — 28th place. |
Yet Singapore's per capita income comes in at $94,481. |
Is India wealthier than Singapore? |
Meantime, the nation of Bangladesh boasts a higher gross domestic product than such ramshackle destitutes as Denmark… Hong Kong… New Zealand… Luxembourg… Liechtenstein… Bermuda… and the Cayman Islands. |
Imagine that the destitute nations of Africa united as one. As Australia, it would represent a continent-nation. |
Its combined gross domestic product would be modest yet not impoverishing. |
Would the lives of individual Africans be enriched one penny? |
The answer is no. Their material conditions would remain identical. They would now be merely part of an expanded, identically impoverished polity. |
A Tale of Two Communities |
Or imagine a tiny enclave composed primarily of corporate grandees, hedge fund titans, physicians, attorneys and related professionals. |
Near this oasis of wealth squats a large, dynamic city consisting primarily of the lower and middling classes. Low-skilled immigrants pour in from every compass point to keep the economic machinery in fine hum. |
The city — in the aggregate — is "wealthier" than the enclave. It contributes more to the gross domestic product. |
Yet in which municipality are the people wealthier? |
Yet you seek a real-world example. Then a real-world example you will have: |
From 2010-2019, the advanced nations of Canada and Australia experienced substantial immigration. |
Yet Japan — denounced by economists for its population stagnation and hostility to immigration — exceeded both Canada and Australia in per capita GDP expansion. |
More Is Not More |
Once again, the Center for Immigration Studies: |
One might think that given all the voices calling for more population growth, there must be a large body of research showing that population growth increases per capita GDP. But that is not what the research shows. |
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In a well-known meta-analysis, Derek D. Headey and Andrew Hodge examined dozens of previous studies that had looked for a relationship between population growth and per capita economic growth. They found evidence that population growth actually adversely impacts economic growth. |
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More recently, Ronald Lee and Andrew Mason found that low fertility — around the current rate in the United States — actually increases per capita economic growth and raises standards of living. |
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They conclude that "low fertility is not a serious economic challenge." Instead, they find that "The effect of low fertility on the number of workers and taxpayers has been offset by greater human capital investment, enhancing the productivity of workers." |
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It's All About Funding the Welfare and Warfare State |
Yet aside from many within the sitting administration, the United States government is less concerned with per capita GDP than aggregate GDP. |
That is because it requires aggregate GDP expansion to fund its behemoth social "insurance" programs… and its globe-trotting military. |
Thus the economy must grow, grow, grow, else the mechanism fails. |
If the United States must import half the world's population to expand its aggregate GDP, then it will import half the world's population — or two-thirds of it — or whichever percentage will work the trick. |
Would the nation be wealthier? On paper perhaps. Yet in reality? |
Besides, we are told that artificial intelligence will displace millions and millions of American jobs in the coming times. |
Why then does the United States require such massive inflows? |
Who We Are |
Yet perhaps I am against the perpetually expanding population equals perpetually expanding wealth theory due to my own personal crotchets. |
I simply dislike crowds. I find them sources of irritation, annoyance and objectionability. Thus I avoid them when possible. |
And so I am for a less crowded United States. |
If a less crowded United States means a reduced aggregate gross domestic product… then it means a reduced aggregate gross domestic product. |
Yet it need not mean a reduced per capita GDP. And per capita GDP, as argued here, is the true metric, the golden metric, the metric that matters. |
And the huddled masses, yearning to breathe free? |
I understand Antarctica is severely underpopulated. And there exists no freer air on Earth. |
There is your El Dorado. There is your Elysium. |
There is your Eden! |
Brian Maher |
for Freedom Financial News |
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