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Paying People to Have Kids Can Only Do So Much When You’re in a Spiraling Baby Bust

Washington Examiner

September 1, 2023

“Frankly, whenever elections come up politicians tend to unveil grand measures aimed at resolving the birthrate issue,” Choi Seul-ki, a demographer in South Korea, told the Wall Street Journal. “But cash is a limited incentive in changing people’s outlook on life.”

Indeed, South Korea has spent more than $210 billion in the past decade in an effort to boost birthrates. It has failed, and birthrates have dropped to shocking lows, well below one baby per woman.

South Korea’s government gives a monthly child allowance of more than $500, and that is going up next year to about $750 a month. The Korean government also subsidizes parental leave for a year, which it will soon expand to 18 months.

Yet Korea’s birthrate keeps falling.

South Korea isn’t the only country to have this experience. Hungary has gone all out to boost marriage and baby making, and its birthrate has barely nudged up. It’s still very low, and nowhere near replacement level. Hungary’s population is still falling every year.

China, since abandoning its anti-natal policies, has tried going pro-natal. That hasn’t worked, and China’s population is now shrinking.

The general rule is this: A government can boost birthrates if it gives large piles of cash to people for having babies, but it can only boost them a little bit, and it costs a lot of money.

The reason: if the culture is anti-baby, people won’t have babies.

From Korea, the Wall Street Journal reports: “The cash incentives have proven ineffective because larger societal issues such as work-life balance and intense competition haven’t been resolved, said Lee Sang-lim, a demographer at the Korea Institute for Health and Social Affairs.”

The paper quotes Lee: “The younger generation fears perpetuating competition and not having a child essentially lowers the risk of passing down unhappiness.”

And that’s the key. South Korea’s could-be parents are sad, not merely in an individual way, but as a society. I call it Civilizational Sadness.

In East Asia, Civilizational Sadness is tied up with overwork, and it leads to suicide. Civilizational Sadness in Europe and the U.S. has a different flavor, inflected with climate fear.

The result is that falling birthrates are self-reinforcing. Fewer babies makes us sadder, and being sad makes us not want to reproduce.