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Monday, April 28, 2008

Russia, Imploding (again)

Writing in the Wall Street Journal Nicholas Eberstadt, a researcher at the American Enterprise Institute in Washington D.C., and Hans Groth, a Pfizer global health fellow and managing director of Pfizer-Switzerland, together authors of the book Europe's Coming Demographic Challenge: Unlocking the Value of Health, expose the horror of Russia's demographic collapse:

Russia is a European country, and its population patterns are unmistakably European in a number of respects, e.g. low birth rates, rising illegitimacy ratios and immigration tensions, and an aging population. But its demographic profile and future prospects differs in two important respects that bode ill for Russia's long-term economic outlook – to say nothing of the Kremlin's ambitious goal of becoming the world's fifth-largest economy by the year 2020.

First, Russia's health and mortality situation is vastly worse than Western Europe's. Life expectancy for Russian men is astonishingly low, well below current levels in either Pakistan or Bangladesh. And trends have been moving in the wrong direction for decades. In 2005, male and female life expectancy at birth in Russia were both lower than they had been 40 years earlier.

Russia's brutally high levels of mortality, along with anemic fertility levels, fashion a second "exceptional" demographic trend for the country: depopulation. In the 16-plus years since the end of the U.S.S.R., Russia has recorded over 12 million more deaths than births. Net immigration has only partially compensated for this deficit. Consequently, Russia's population dropped from 148.7 million in 1992 to just over 142 million at the start of this year. Whereas Western Europe faces the prospect of population decline a generation hence, Russia is in the midst of it.

President-elect Dmitry Medvedev envisions a Russia in which births come to exceed deaths by 2014, with positive population growth over the following decade. He has endorsed a new "official demographic concept" with population policies like birth bonuses and other social measures, including in public health, to reverse the decline. Unfortunately, there is not a single example from modern history where pro-natal policies have been able to achieve a sustainable demographic reversal. Outside of Russia, few demographers anticipate depopulation will actually halt over the coming generation. Even the United Nation's "high" projection envisions a drop of over 10 million between 2005 and 2030.

Russia's working-age population is set for an even steeper decline. Between 2005 and 2030, Western Europe's working-age population – aged 15-64 – is projected to shrink by about 7%. In Russia, that figure is 19%. Although Russia's population is just over a third of Western Europe's, absolute declines in working-age population promise to be roughly similar in magnitude over the coming decades. On current mortality schedules, seven of eight Swiss men 20 years of age can expect to celebrate their 65th birthday; only three out of seven Russian men can have the same hope.

In and of itself, the sharp falloff in working-age population – together with the rising ratio of older citizens to Russians of working age – frames a serious demographic challenge for the effort to propel economic growth and raise living standards. But the problem is even more acute than these raw numbers might suggest. For Russia's mortality problem is concentrated in its working-age population.

For over 40 years, Russia has been witness to a truly terrifying upsurge of illness and death precisely among those who ordinarily form the backbone of a modern economy. In 2005, for men between the ages of 27-57, death rates were typically 100% higher than they had been in 1965. As for Russia's women, their situation might only be described as "good" in comparison to that terrible record for Russian men. Death rates for women aged 26-59 in 2005 were at least 40% higher than in 1965 – and for some ages, death rates were up by 50%, 60%, or even 70%.

The causes of death are clear enough: Skyrocketing mortality from cardiovascular disease and injuries (accidents, poisoning, suicides and homicides). The underlying causes here are harder to pinpoint, but we can mention a number of plausible factors: Poor diet, lack of exercise, heavy smoking, and social stress. Russia's deadly love affair with the vodka bottle remains legendary, and looks to be another significant factor, with per capita consumption extraordinarily high.

Russia's "excess mortality" threatens to straitjacket Russian productivity and development. It is true that Russia has enjoyed robust economic growth rates over the past several years, but this has primarily been generated by oil and gas exports. In the modern world economy, a country's health profile is an essential element of its sustainable economic potential – quite arguably, the key element. How can Russia hope to be a vibrant modern economy with a dwindling and debilitated workforce and a life expectancy which is a full 12 years shorter than in Western Europe? No modern society can expect to enjoy an Irish standard of living on an Indian survival schedule.

If Russia is to arrive in the front ranks of 21st-century economies, the yawning health gap that separates Russians from the rest of Europe and all other industrialized democracies has to be closed. Nothing less than a protracted national struggle may be necessary to achieve this goal.

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