September 12, 2005

Demographics and Iran's imperial design

Aging populations will cause severe discomfort in the United States and extreme pain in Japan and Europe by mid-century. But the same trends will devastate the frail economies of the Islamic world, and likely plunge many countries into social chaos.

By 2050, elderly dependents will comprise nearly a third of the population of some Muslim nations, notably Iran - converging on America's dependency ratio at mid-century. But it is one thing to face such a problem with America's per capita gross domestic product (GDP) of $40,000, and quite another to face it with Iran's per capita GDP of $7,000 - especially given that Iran will stop exporting oil before the population crisis hits.

The industrial nations face the prospective failure of their pension systems. But what will happen to countries that have no pension system, where traditional society assumes the care of the aged and infirm? In these cases it is traditional society that will break down, horribly and irretrievably so. Below, I will review the relevant numbers.
 

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