[dev_dull]

> Most people seem to agree with this statement, which is the very definition of a pyramid scheme (see my point about hysteresis above). We've defined the goalposts such that this statement is in some sense tautologically true, but it leaves me with a profound sense of "so what?"

For countries with any kind of social / welfare programs, there is no option available but to grow population. Even here in the USA programs like social security are only solvent to 2037[1]. Many state programs (such as public pensions) are in way worse positions...

1. https://www.ssa.gov/policy/docs/ssb/v70n3/v70n3p111.html

[mdorazio]

I don't think that actually holds. I hate to trot out the typical example, but Norway seems to be doing pretty well on the social welfare side with a fertility rate much lower than that of the US. They just have very different priorities than the US does in terms of taxation, wealth distribution, and of course deficit spending vs. creating a sovereign wealth fund.

I don't see any reason why the US couldn't maintain social welfare programs in a decreasing population scenario provided the decrease is gradual, productivity rises as fast as the population goes down, and we actually taxed people appropriately and got our expenditure priorities under control.

[dev_dull]

Norway’s top personal tax rate is similar to the US (39%, which is less than what some people pay in high cost of living states here).

The difference, as I’m sure you already know, is state oil revenue, and that can’t last forever even with sovereign wealth funds.

[Arn_Thor]

Sweden, Finland and Denmark are also very apt examples, none of whom have oil.

(Norway also uses very little of its oil revenue, saving most of it)

[pnako]

Why not? You could have a welfare system that redistributes any excess return from the fund above long-run inflation rate, and it would be sustainable.

[AnthonyMouse]

A significant fraction of the historical rate of return on capital is attributable to the combination of population growth and inflation. Without those the size of the fund you would need to cover a material fraction of government spending would be implausibly large.

Sovereign wealth funds also aren't all that different economically from taxation, in the sense that the profits from what the fund is invested in go to funding government programs rather than being reinvested in private enterprise. If the fund was large enough to be relevant, that would become an issue for the economy.

[krapht]

Norway is also very homogeneous. We are more willing to be generous to those related to us; and I'm not talking just about race, but also culture, values, and ideology. In all these respects, the United States is far more diverse.

So I guess I agree with you, but I don't think those conditions can be replicated here.

[jelliclesfarm]

I don’t know why you were downvoted. You are right. I have found this to be true in Japan too.

Homogenous populace = low conflict.

[triceratops]

Why? Productivity continues to increase, regardless of population increasing. It's like saying we can do more with less everywhere, except when it comes to taking care of people and the elderly.

[paulajohnson]

Taking care of the elderly is a labour intensive business. Automation doesn't clean an old person's glasses (real life example), make their bed or cook their meals.

[triceratops]

Automation doesn't need to do any of those things (even though it eventually could). It could simply make other industries so cheap and efficient that more labor flows into elder care.

[einpoklum]

The labor intensiveness is not binary.

Specifically, if there are socialized "assisted living" facilities, or even in-the-community caregiver visitation, then the amount of caregiving work-hours per day per elderly person is X. If the only possible arrangement is getting a live-in personal care-giver, then that figures is 2X or 3X (or some factor, I don't have the figures); and most people probably just don't get care.

[buboard]

increased demand will drive more automation in that sector

self driving cars may be limited but they will be a great solution for the elderly

[Paperweight]

Ultrasonic cleaners, man!

[tyscorp]

Not yet.

[pnako]

>with any kind

No. That's obviously the case for countries whose welfare system has been designed as a pyramid system.

But saying that any kind of welfare is necessarily unsustainable is as absurd as saying that spending on video games or Ethernet cables is necessarily unsustainable.