Saturday, July 04, 2009

The sobering reality of immigration

The London Free Press
By Rory Leishman

As the baby-boom generation begins to retire, the ratio of Canadians over age 65 to those of working age (the old-age dependency ratio) is set to increase so rapidly that the costs of sustaining Canada’s retirees threaten to reduce the rate of growth in Canada’s national standard of living.
What can be done? Robin Banerjee and William Robson of the C. D. Howe Institute have addressed this issue in an illuminating report released on Thursday: “Faster, Younger, Richer? The Fond Hope and Sobering Reality of Immigration’s Impact on Canada’s Demographic and Economic Future.”
It might be supposed that immigration will offset the growing burden of Canada’s aging population. This year alone, Canada is expected to take in an additional 245,000 immigrants. With the exception of Australia, Canada maintains much the highest ratio of immigrants to population in the industrialized world.
Nonetheless, Banerjee and Robson estimate that even if the extraordinarily high current rate of net immigration into Canada is retained, the old-age dependency ratio will more than double to 46.3 per cent in 2057. That’s up from 21.5 per cent this year and less than 15 per cent in 1977.
Is even more immigration the answer? Definitely not. Banerjee and Robson project that if Parliament were to rely on an increase in the current pattern of immigration to stop population aging, Canada would have to take in such a colossal number of additional immigrants that the total national population would reach 210 million in 2058.
That’s out of the question. No conceivable amount of immigration can prevent a rapid and burdensome growth in the aging of Canada’s population.
An increase in the age of retirement would help. Most Canadians at age 70 are no less fit today than were most Canadian workers at age 65 a few decades ago.
Banerjee and Robson conclude that a gradual increase in the normal retirement to age 70 would significantly reduce the rise in the old-age dependency ratio; but only temporarily. It’s likely that within 15 years, the proportion of elderly dependants would resume a steadily upward trend.
There can be no lasting solution to the multiplying difficulties posed by Canada’s aging population short of dealing with the fundamental underlying problem – namely, the devastating collapse in the national fertility rate over the past 40 years. In 2005, the average number of children per woman in Canada was just 1.54 -- far below the ratio of 2.1 that is necessary to sustain the population.
Banerjee and Robson have considered the combined effects of a gradual increase in both the age of retirement to age 70 and the national fertility rate to 2.1. The results are encouraging: Other factors remaining the same, the old-age dependency ratio would remain well below 30 per cent.
Banerjee and Robson do not suggest how Parliament and the provincial legislatures might encourage a rise in the national fertility rate. However, at least one part of the solution is obvious: A major reduction in the catastrophic increase in abortions over the past 40 years.
According to Statistics Canada, there were 28.3 induced abortions for every 100 live births in Canada in 2005, down from a peak of 32.2 in 1998. While that slight downward trend is encouraging, it’s hardly sufficient.
Sooner or later, our politicians will have to take decisive action to curb abortion. Few reforms could do more to eliminate a huge amount of suffering and death.
Moreover, as Banerjee and Robson point out, boosting fertility rates could also play a key role in holding down the rate of increase in old-age dependency that threatens the economic prosperity of Canadians.

Correction: In “Ontario should continue to fight menace of marijuana” (Free Press, June 27), I attempted to summarize my findings from a review of the literature on the harm produced by the recreational use of cannabis with the assertion: “there is overwhelming scientific evidence that cannabis is no less dangerous to life and health than alcohol and tobacco.”
That statement is incorrect. I very much regret the error.

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