German demography: Old dogs, new tricks

Debating population policy is no longer taboo

IF GERMANY'S body politic is good at one thing, it is getting into a tizzy. Last week, the excitement was over the damage the ruling coalition of Social Democrats and Greens might suffer from a new immigration law. This week, the question is whether Hans Eichel, the finance minister, will have to go if the government borrows more money to cover huge tax shortfalls. Yet if you think Germany, in a year with more than a dozen elections, is all about short-term politics, think again. At last, Germany's chattering classes are facing up to the country's biggest long-term challenge: an ageing population. “In Germany, 2004 is the year of demography,” says James Vaupel, executive director of the Max Planck Institute for Demographic Research in Rostock.

After half a century of obscurity, population issues are resurfacing in headlines, bestseller lists and talk shows. When in April the Berlin Institute for World Population and Global Development, a think-tank, issued a study saying which regions will suffer from a shrinking population, it was amazed by the media interest. And Germany's bestselling book is “Das Methusalem-Komplott” (The Methuselah conspiracy), an anti-ageism tirade by Frank Schirrmacher, a co-publisher of the Frankfurter Allgemeine Zeitung newspaper.

Both publications paint a bleak picture. Some regions are in a death spiral of sorts, says Reiner Klingholz, one of the authors of the study - and others may share that fate in years to come: their population is imploding, not just because of a lack of babies but because young, qualified people are moving away, making many regions even less attractive for job-creating investments. Mr Schirrmacher fears a clash of the generations and wants a cultural revolution to rethink what it means to be old.

If Germany has suppressed its demographic problems for so long, it is mainly because of its Nazi past. Population policy sounded like racial policy. Even today, the country has only four university chairs in demography. There are many reasons Germans are waking up now, says Elisabeth Niejahr, author of a forthcoming book entitled “Altenrepublik” (Republic of the Old): the financial woes of public pension funds and the health-care system; unification (most imploding regions are in the east); and the fact that Germany's baby-boomers (like the 44-year-old Mr Schirrmacher) are beginning to be elderly.

Ms Niejahr's book is another sign that the debate is moving beyond numbers. She says Germany's ageing will affect not just pension funds, but the whole of society - how people “live, work and love”, to quote her subtitle. What does it mean for entrepreneurship and economic risk-taking if more than one-third of the population is older than 60? How must firms reorganise to use old people's experience and ideas? How can immigrants be integrated?

In the same vein, a recent study by Deutsche Bank looks at what a shrinking and ageing population will mean for public infrastructure. Intuition suggests that the state will need to spend less. In fact, maintaining acceptable road, utility and school systems may well become more expensive. Although the number of students in Germany will go down by about a third by 2050, for instance, costs per student will most likely go up because schools need to be kept open in less populated areas.

It is unlikely that politicians will deal with such long-term issues in time, given their slowness to tackle problems that will arise even sooner. Instead of pushing on with structural reform, the Social Democrats are talking of ditching the budgetary rigour demanded by the European Union. They have revived the Iraq war as a campaign issue to avoid disaster at the European elections in June. Meanwhile the opposition conservatives, while vowing to promote necessary reforms, are dragging their feet over details. Perhaps the only hope is that an older Germany will start turning into a wiser one - soon enough to avoid disaster.

Germany is finally beginning to talk about demographic challenges.

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