The premise of this article is that Total Population = Total National Power, or that raw numbers are somewhat of a proxy for strength and prosperity. It also implies that by necessity a growing old/young ratio will saddle a country by diverting funds from capital investment to taking care of the old.

Although most of these claims seem to be “obvious” and logically sound, there are I think a number of caveats to consider:

1. While overall population is shrinking, by and large china is replacing a huge population of low-skill farm and industrial laborers with medium to high-skilled educated workers who are likely to out-earn them by large margins.

2. If anything the problem for the Chinese economy for the past 20 years hasn’t been under-investment but Over-Investment. What that means is that all those ghost cities, empty roads and suboptimally run factories leave a lot of slack in the system for growth to continue at lower investment rates.

3. It may actually benefit China, as it shifts from an export driven to a consumption driven economy to have a large population of idle old people spending money on the economy, it means that the government can grow the economy by directing more funds to people rather than to hard assets whose ROI becomes increasingly dubious.

4. China is investing heavily in AI, automation and creating other types of competitive advantages in order to supersede their historical dependence on raw numbers of cheap labor. Although the judge still is out, I think this article is premised on backward looking assumptions (You need lots of workers to have a growing economy!) rather than forward looking... (what type of society may technology enable us to build?). Furthermore it misses out on how all the investments China has made in the near past will be leveraged in the future. I’d argue that what a small population can do with good infrastructure, education, etc. is orders of magnitude higher than what a huge population can do with poor infra/edu. By any measure even in a hundred years China will still have a working population roughly equal to the west/NATO as a whole... they will also have thousands of miles of bullet trains, subways, roads, waterways and if things go to plan an unrivaled manufacturing capacity and a digital infrastructure (in terms not only of internet connections, but also an ecosystem of big and small companies, VCs, etc) that although powerful in the US is almost nonexistent in europe.

5. China is building a domestic financial infrastructure that is likely to rival that of the west (already how many IPOs were there in Germany, or all of europe ex-UK last year vs NY or HK+Shanghai+Shenzhen?) which will enable it to create a self sustaining domestic ecosystem for allocating capital more effectively.

All this goes to say that -and I’m no China shill- that I find the whole article rests on some sort of western progressive complacency that diminishes the scale of geopolitical rivalry that China presents and thinks that we can overlook our problems because in due time the public will come around to some easy, invariably obvious, solution. For instance, if you think that national power derives from sheer numbers of people the logical conclusion is that all the west’s problems will be solved once massive numbers of immigrants -mostly uneducated- are let in. Nevertheless although there is undoubtedly a role that immigration can play in growth (just look at the number of companies started by first or second generation immigrants) I think this obfuscates the real factors that enable economic growth and which often times are opposed by the type of facile progressive arguments that often underlie pieces like this and are also often against business and growth friendly policies. In particular I don’t think that immigrants themselves are that important if you think of them without also considering the enabling factors, such that it wasn’t Elon Musk alone that made paypal/tesla/spacex, but Elon Musk + America. Why I say this is that I believe China is heavily investing to make this type of thing a reality there and so I think any analysis of the country that looks at it through “anyplace-glasses” errs, because in fact we should look at China through “exceptional-place-glasses” and more importantly, we should think more about what the consequences may be for the future of all of us outside China of an exceptional place fully becoming its own but with an almost all-powerful 21st century tech enabled authoritarian regime.