Why America needs a population czar
Our policies on immigration, family planning, and much more affect long-term population growth and even Social Security in ways we don’t understand.
Last month, President Trump voiced his support for a bill that could cut legal immigration to the United States by half. The bill, the Reforming American Immigration for a Strong Economy (RAISE) Act, favors immigrants with higher skill levels and educational attainment over today’s policies, which are lottery-driven and favor family connections. Questions about RAISE largely center on how the policy fits American ideals such as openness, and on potential economic consequences, like its impact on wages for blue collar Americans or whether it will lower tax burdens compared with current policies.
But no one is asking one of the most critical questions: How does RAISE affect our population over the long term? The answer to that question carries fundamental implications for our economic growth and for the health of Social Security. It’s almost certain that RAISE, if passed as written, will slow population growth in the United States. It might even lead to population declines.
Fertility rates in this country are at historic lows — in 2016, there were 62 births per 1,000 women aged 15 to 44. That rate is less than the number we need to keep our population from declining. Historically, the majority of our population growth has come from immigration. A 2015 Pew Research Center report showed immigrants and their descendants increased our population by 72 million from 1965 to 2015, and 88 percent of expected population growth over the next 50 years will be directly due to immigration and the fertility of immigrants. RAISE reduces the number of legal immigrants, and the highly skilled individuals it favors have fertility rates similar to the low rates of the native US population.
Slower population growth can have pluses — it puts less stress on the environment, and it can create higher wages. But if RAISE slows population growth or even leads to population declines, that almost certainly means America will have fewer young people. Young people drive innovation, bring the latest skills to workforces, and refresh the labor pool. They also have their buying lives ahead of them, so long-term shifts in our population makeup could affect demand for goods and housing. The shifts will affect the Social Security system, as well. Since it’s a “pay as you go” program, younger workers support retirees’ pensions and health care. The United States already faces a decline in the ratio of workers to retirees, which has caused the Social Security Administration to project shortfalls in its ability to meet benefit obligations. RAISE will likely worsen the already considerable financial difficulties facing the program. Do voters realize their Social Security checks might depend on letting in more immigrants?
And RAISE is just the latest example of our collective failure to consider the population effects of proposed legislation. Think about the two major social programs charged with providing family planning services for low-income women: 1970’s Title X National Family Planning and 1972’s Medicaid Family Planning Services. These programs give low-income women the same access to family planning that more affluent women have. These programs are good policy, but they unquestionably reduce fertility rates for lower-income women, and thus the number of young people in our labor force. We’re not saying this is a bad thing. But the country needs to start talking about the consequences new policies have on economic development and on existing programs, like Social Security.
For this reason, we propose the creation of a Congressional Population Office (CPO), to score how proposed legislation — be it for immigration, tax, or social policy — affects our population. The CPO should be modeled after the nonpartisan Congressional Budget Office (CBO), only composed of demographers, economists, and policy analysts dedicated to understanding both the short- and long-term population change implications of policy proposals. The CBO scores hundreds of pieces of federal legislation annually to estimate their budgetary impact. Policy makers, the media, and citizens use this information to make educated judgments. While the CBO has recently been under attack for its scoring of Republican replacements for the Affordable Care Act, most of the criticism involved agency motives, not findings. CBO scoring should be above politics, and the same should be true for population scoring.
Yes, many people are calling for reducing the size of our government. We have no wish to needlessly expand our bureaucracy, but a CPO’s social benefits will easily outweigh its relatively small cost. Giving a CPO score to programs like RAISE, Medicaid, family planning, and others will help us understand their population effects and give policy makers better insight into potential problems. If a proposed policy probably reduces labor supply over time, then the CPO score will raise a series of questions for discussion: Should age eligibility requirements for Social Security be adjusted? Are there other remedies? Or is the population cost of the policy too great?
To be clear: We are not calling for policies that manipulate our population. We are pointing out that our policies already manipulate our population in ways we don’t understand, or even think about. Population scores from the CPO would make the societal consequences of policies clearer and, in turn, help prevent negative long-term economic hits while improving other policy goals.