Sign up for our daily briefing

Make your busy days simpler with Axios AM/PM. Catch up on what's new and why it matters in just 5 minutes.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Catch up on the day's biggest business stories

Subscribe to Axios Closer for insights into the day’s business news and trends and why they matter

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Stay on top of the latest market trends

Subscribe to Axios Markets for the latest market trends and economic insights. Sign up for free.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Sports news worthy of your time

Binge on the stats and stories that drive the sports world with Axios Sports. Sign up for free.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Tech news worthy of your time

Get our smart take on technology from the Valley and D.C. with Axios Login. Sign up for free.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Get the inside stories

Get an insider's guide to the new White House with Axios Sneak Peek. Sign up for free.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Axios on your phone

Get breaking news and scoops on the go with the Axios app.

Download for free.

Catch up on coronavirus stories and special reports, curated by Mike Allen everyday

Catch up on coronavirus stories and special reports, curated by Mike Allen everyday

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Denver news?

Get a daily digest of the most important stories affecting your hometown with Axios Denver

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Des Moines news?

Get a daily digest of the most important stories affecting your hometown with Axios Des Moines

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Twin Cities news?

Get a daily digest of the most important stories affecting your hometown with Axios Twin Cities

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Tampa Bay news?

Get a daily digest of the most important stories affecting your hometown with Axios Tampa Bay

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Charlotte news?

Get a daily digest of the most important stories affecting your hometown with Axios Charlotte

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Sign up for Axios NW Arkansas

Stay up-to-date on the most important and interesting stories affecting NW Arkansas, authored by local reporters

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Illustration: Aïda Amer/Axios

While embroiled in the most vivid display of great power rivalry since the Cold War, the U.S. and China are both also battling a largely invisible force — relentlessly unfavorable demographics that are sapping their long-term economic vitality.

Driving the news: As we have reported, the global population as a whole is aging and shrinking, but the trend is striking China especially hard just as it challenges the U.S. for long-term global primacy, according to experts and a number of recent reports.

The big picture: For four decades, China has carried out one of the longest, fastest and biggest economic transformations in history. Integral to China's miracle has been its 1-child policy, which has constrained the size of its bulging population. But demographic experts say that, even though 2 children per family are now permitted, the policy has baked in a dire mid-century future for China.

So dramatic are the unfolding trends that they will swamp geopolitics and make China's rise much less certain, argues Nicholas Eberstadt, a demographic expert at the American Enterprise Institute.

  • China's working-age population has been shrinking since 2014, and will lose at least 100 million people by 2040, Eberstadt says.
  • At the same time, the elderly population is exploding in size: By 2050, more than a third of the population — 487 million people — will be over 60 years old, and in need of public support.

The U.S. faces similar demographic problems, including a fertility rate of just 1.7. But they are not as grave as China's since, historically speaking, the U.S. is much more open to immigration. The American working age population is forecast to grow about 10% by 2040.

  • Conversely, China is neither willing to absorb foreigners in large numbers, nor having enough children: Fertility has been below the 2.1-per-couple replacement rate since the 1990s.
  • Chinese fertility averaged just 1.18 between 2010 and 2018, according to a paper earlier this year by Yi Fuxian, a professor at the University of Wisconsin-Madison.
  • In another paper, Yi and a co-author argued that the Chinese population actually contracted last year, much earlier than the 2027-2029 inflection point forecast by most experts.

Put together, the trends — the shrinking, aging and low fertility of the population — will overwhelm the Chinese economy, Eberstadt said. "The age of heroic economic growth is over."

There are steps the Chinese can take: Already, the Chinese are installing industrial robots at a dizzying pace. And Brad Setser, an economist with the Council on Foreign Relations, said China can raise the retirement age and allowing more internal migration by workers from rural areas. "With per capita GDP still only a fraction of U.S. levels, China also still has scope for catch up growth."

But Wang Feng, a professor at the University of California at Irvine, said the demographics ultimately threaten the government's political hold because it will no longer be able to afford social payments to the public.

  • "By our estimates, public spending on basic social welfare provisions, education, health care, and pension, will eat up the entire government fiscal revenue, as its current share of GDP, in the coming decades," Feng tells Axios.

Go deeper: Why population will drive geopolitics

Go deeper

More than a dozen injured in downtown Austin shooting

Police tape in Austin, Texas in 2018. Photo: y Carolyn Van Houten/The Washington Post via Getty Images

A shooting in a busy part of downtown Austin, Texas, early Saturday injured at least 13 people, including two who are in critical condition.

The state of play: Gunfire erupted around 1:30 a.m. along 6th Street, a popular area with bars and restaurants. The suspected shooter remains at large, Austin police said. "It is unknown if there is one, or multiple suspects involved," they noted, adding the shooting appears to be an isolated incident.

Biden to urge G7 to take unified approach to countering China

Photo: Hollie Adams/Bloomberg via Getty Images

President Biden on Saturday is expected to urge fellow G7 leaders to adopt a unified approach to countering China's rising global influence, AP reports.

Driving the news: The G7 leaders are set to unveil a multi-billion-dollar global infrastructure plan aimed at rivaling Beijing's efforts in the developing world.

Why America's post-vaccine summer is off to a slow start

Illustration: Sarah Grillo/Axios

Americans are itching to put pandemic life behind them, but many of the necessary ingredients for a summer of carefree fun — everything from neighborhood pools to car rentals — still aren't fully available.

The big picture: Labor shortages, scrambled supply chains and simple logistics are all making it harder for a whole range of businesses to meet post-pandemic demand, and that’s making “hot vax summer” a little harder to pull off.

You’ve caught up. Now what?

Sign up for Mike Allen’s daily Axios AM and PM newsletters to get smarter, faster on the news that matters.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!